In connection with a debt financing in December 2013, the Company issued warrants to purchase 128,231 shares of its common stock with an exercise price of $5.84 per share. These warrants are exercisable any time at the option of the holder until December 16, 2023. During the year ended December 31, 2019, the Company issued 36,457 shares of its common stock upon the net exercise of 2013 Placement Warrants to purchase 128,231 shares. All of the December 2013 Placement Warrants have been exercised and none of the warrants are outstanding at December 31, 2019.

In connection with the merger of ViewRay, Inc. and ViewRay Technologies, Inc. in July 2015, or the Merger, in July and August 2015, the Company conducted a private placement offering as part of which the Company issued warrants, or the 2015 Placement Warrants, that provide the warrant holder the right to purchase 198,760 shares of common stock at an exercise price of $5.00 per share. The 2015 Placement Warrants are exercisable at any time at the option of the holder until the five-year anniversary of their date of issuance. During the year ended December 31, 2018, the Company issued 92,487 shares of its common stock upon the net exercise of 2015 Placement Warrants to purchase 159,010 shares. The remaining 2015 Placement Warrants to purchase 39,750 shares have not been exercised and remained outstanding at December 31, 2019.

In connection with the March 2018 Direct Registered Offering, the Company issued warrants to purchase 1,418,116 shares of common stock at an exercise price of $8.31 per share. The 2018 Offering Warrants became exercisable upon issuance and expire in March 2025. None of the 2018 Offering Warrants have been exercised to date and they all remained outstanding at December 31, 2019.

As separate classes of securities were issued in a bundled transaction, the gross proceeds from the March 2018 Direct Registered Offering of $59.1 million were allocated to common stock, Series A convertible preferred stock and the 2018 Offering Warrants based on their respective relative fair value upon issuance. The aggregate fair value of the 2018 Offering Warrants of $7.4 million was estimated using the Black-Scholes option-pricing model with the following assumptions:

The allocated proceeds from the 2018 Offering Warrants of $6.6 million was recorded in additional paid-in-capital.

In connection with the 2017 and 2016 Private Placements, the Company issued the 2017 and 2016 Placement Warrants, that provide the warrant holder the right to purchase 1,720,512 and 1,380,745 shares of common stock. The 2017 and 2016 Placement Warrants contain protection whereby the warrant holders will have the right to receive cash in the amount equal to the Black-Scholes value of the warrants upon the occurrence of a change in control, as defined in the agreement. The 2017 and 2016 Placement Warrants were accounted for as a liability at the date of issuance and are adjusted to fair value at each balance sheet date, with the change in fair value recorded as a component of other income (expense), net in the consolidated statements of operations and comprehensive loss. The key terms and activity of the 2017 and 2016 Placement Warrants are summarized as follows:


	Issuance Date	Term	Exercise Price Per Share		Warrants Exercised during the Year Ended December 31, 2018		Warrants Outstanding at December 31, 2018		Warrants Exercised during the Year Ended December 31, 2019		Warrants Outstanding at December 31, 2019

2017 Placement Warrants	January 2017	7 years	$	3.17		1,591		1,709,532		90,642		1,618,890
2016 Placement Warrants	August and September 2016	7 years	$	2.95		225,026		1,130,615		593,352		537,263
Total						226,617		2,840,147		683,994		2,156,153

As separate classes of securities were issued in a bundled transaction, the gross proceeds of $26.1 million and $13.8 million from the 2017 and 2016 Private Placement were allocated first to the 2017 and 2016 Placement Warrants based on their fair value upon issuance, and the residuals were allocated to common stock. The fair value upon issuance of $3.4 million and $2.7 million were estimated using the Black-Scholes option-pricing model using the following assumptions:

	Upon Issuance
	2017 Placement Warrants		2016 Placement Warrants

Expected term (in years)		7.0		7.0
Expected volatility (%)	62.9%		61.6%
Risk-free interest rate (%)	2.2%		1.4%
Expected dividend yield (%)	0%		0%

During the year ended December 31, 2019, the Company recorded a gain of $2.6 million and loss of $0.1 million, respectively, related to the change in fair value of the 2017 and 2016 Placement Warrants. During the year ended December 31, 2018, the Company recorded a gain of $5.4 million and $4.0 million, respectively, related to the change in fair value of the 2017 and 2016 Placement Warrants. During the year ended December 31, 2017, the Company recorded a loss of $9.2 million and $7.4 million, respectively, related to the change in fair value of the 2017 and 2016 Placement Warrants. The fair value of the 2017 and 2016 Placement Warrants at December 31, 2019 and 2018 was estimated using the Black-Scholes option-pricing model and the following weighted-average assumptions:

	2017 Placement Warrants				2016 Placement Warrants
	December 31, 2019		December 31, 2018		December 31, 2019		December 31, 2018

Expected term (in years)		4.0		5.1		3.6		4.7
Expected volatility	68.0%		60.8%		67.5%		60.9%
Risk-free interest rate	1.7%		2.5%		1.6%		2.5%
Expected dividend yield	0%		0%		0%		0%