In February 2019, the Company issued and sold 4,625,000 shares of common stock at a public offering price of $8.00 per share and pre-funded warrants to purchase up to 4,000,000 shares of common stock at a public offering price of $7.9999 per warrant in an underwritten public offering pursuant to a shelf registration statement on Form S-3. This includes the full exercise by the underwriters of their option to purchase up to 1,125,000 additional shares of common stock. The net proceeds to the Company from this offering were $64.5 million, after deducting underwriting discounts and commissions of $4.1 million and offering costs of $0.4 million.

The public offering price for the pre-funded warrants was equal to the public offering price of the common stock, less the $0.0001 per share exercise price of each warrant. These warrants were recorded as a component of stockholders’ equity within additional paid-in capital and have no expiration date. Per the terms of the warrant agreement, the outstanding warrants to purchase shares of common stock may not be exercised if the holder’s ownership of the Company’s common stock would exceed 4.99% (“Maximum Ownership Percentage”). By written notice to the Company, the holders may increase or decrease the Maximum Ownership Percentage. The revised Maximum Ownership Percentage would be effective 60 days after the notice is received by the Company. As of March 31, 2019, none of the pre-funded warrants have been exercised.

The 2016 Equity Incentive Plan (“2016 Plan”) provides for an automatic increase in the number of shares reserved for issuance thereunder on January 1 of each year for the remaining term of the plan (through 2028) equal to (a) 4.0% of the number of issued and outstanding shares of common stock on December 31 of the immediately preceding year, or (b) a lesser amount as approved by the Company’s board of directors each year. As a result of this provision, on January 1, 2019 and January 1, 2018, an additional 965,603 and 666,807 shares, respectively, became available for issuance under the 2016 Plan.

As of March 31, 2019, the 2016 Plan had 1,499,373 shares available for future issuance.

During the three months ended March 31, 2019 and 2018, the Company issued an aggregate of 1,042,300 and 829,500 options to purchase common stock, respectively, under the Company’s equity incentive plans for an aggregate fair value of $6.2 million and $3.9 million, respectively.

Under the Company’s 2016 Employee Stock Purchase Plan (“2016 ESPP”), the Company issued and sold 20,132 shares for aggregate cash proceeds of $0.1 million during the three months ended March 31, 2019 and 30,937 shares for aggregate cash proceeds of $0.1 million during the three months ended March 31, 2018.

Total stock-based compensation expense related to the Company’s equity incentive plans and 2016 ESPP was as follows (in thousands):

	Three Months Ended
	March 31,
	2019		2018
Research and development	$	402	$	323
General and administrative		679		512
Total stock-based compensation expense	$	1,081	$	835

The following table summarizes the weighted-average Black-Scholes option pricing model assumptions used to estimate the fair value of stock options granted under the Company’s equity incentive plans, and the shares purchasable under the 2016 ESPP during the periods presented:

	Three Months Ended
	March 31,
	2019			2018
Equity Incentive Plans
Expected term (in years)		6.03			6.01
Expected volatility		82	%		85	%
Risk-free interest		2.57	%		2.72	%
Dividend yield		0	%		0	%

2016 ESPP
Expected term (in years)		0.49			0.49
Expected volatility		66	%		69	%
Risk-free interest		2.55	%		2.00	%
Dividend yield		0	%		0	%