9. Net loss per share

In connection with the IPO, the Company’s capital structure was reorganized such that AQXP Canada became a wholly owned subsidiary of Aquinox USA, and the holders of the preferred shares of AQXP Canada and common shares of AQXP Canada exchanged their shares for shares of preferred stock or common stock, respectively, of Aquinox USA (see Note 7(d)). In addition, the holders of preferred shares of Aquinox USA converted their shares into shares of common stock of Aquinox USA. In connection with the IPO, the Company effected a 1-for-19.2 reverse stock split. The common stock, options and warrants outstanding as of the completion of the reorganization were 5,845,260 shares, 628,754 options and 11,363 warrants, respectively. Basic and diluted earnings per share has been retroactively restated for all periods prior to the reorganization.

Basic and diluted net loss per common share are presented using the two-class method required for participating securities. If a dividend is paid on common stock, the holders of preferred stock are entitled to a proportionate share of any such dividend as if they were holders of common stock (on an if-converted basis). The Company considered its preferred stock to be participating securities and, in accordance with the two-class method, earnings allocated to participating securities and the related number of outstanding shares of participating securities have been excluded from the computation of basic and diluted net loss per common share.

The Company considers the Aquinox USA common stock to be their participating stock that is subordinate to all other stock or shares of the Company. These shares are used by the Company when computing its loss per share. Under the two-class method, net loss attributable to common stockholders is determined by allocating undistributed loss between common stock and participating securities. Undistributed loss is calculated as net loss less distributed loss, accretion of liquidation preference on preferred stock, accretion of share issuance costs on preferred stock, and tax expense on preferred stock. As holders of preferred stock, holders of stock options and holders of common stock warrants do not have contractual obligations to share in the losses of the Company, the net loss attributable to common stockholders for each period is not allocated between common stock and participating securities. Accordingly, outstanding stock options, common stock warrants and preferred stock are excluded from the calculation of basic and diluted net loss per share as the effect would have been anti-dilutive.

The detail of the computation of basic and diluted earnings per share is as follows:


	DECEMBER 31, 2015			DECEMBER 31, 2014			DECEMBER 31, 2013
*Numerator*
Net loss	$	(21,860	)	$	(24,027	)	$	(8,729	)
Accretion for liquidation preference on preferred stock		—			(1,133	)		(5,351	)
Accretion for share issuance costs on preferred stock		—			(20	)		(123	)
Tax expense on preferred stock		—			(100	)		(738	)
Reversal of tax payable on preferred stock due to conversion of preferred stock		—			1,898			—
Extinguishment of remaining share issuance costs due to conversion of preferred stock		—			(439	)		—

Total loss attributable to common stockholders	$	(21,860	)	$	(23,821	)	$	(14,941	)

*Denominator*
Weighted average shares used to compute basic and diluted net loss per common share		12,637,839			8,667,387			301,745

Net loss per share attributable to common stockholders – basic and diluted	$	(1.73	)	$	(2.75	)	$	(49.52	)

The following have been excluded from the computation of basic and diluted net loss per share as their effect would have been antidilutive:


	DECEMBER 31, 2015		DECEMBER 31, 2014		DECEMBER 31, 2013
Convertible preferred stock		—		—		5,543,515
Outstanding stock options		865,457		824,608		628,754
Common stock warrants		11,363		11,363		11,363

Total		876,820		835,971		6,183,632