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SEC Filings

OREXIGEN THERAPEUTICS, INC. filed this Form S-1/A on 04/09/2007
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(a development stage company)


value of the options is amortized on a straight-line basis over the vesting period. The fair value of these awards was estimated at the date of grant using the Minimum Value option pricing model with the following weighted average assumptions for all periods: risk free interest rate of 4.40%; dividend yield of 0%; and a weighted average expected life of the options of six years. The effect of using the Minimum Value option pricing model on these grants did not result in pro forma results that were materially different from the reported net loss for each of the years ended December 31, 2004 and 2005.
Equity instruments issued to non-employees are recorded at their fair value as determined in accordance with SFAS No. 123 and Emerging Issues Task Force Issue No. 96-18, Accounting for Equity Instruments That are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling Goods and Services, and are periodically revalued as the equity instruments vest and are recognized as expense over the related service period. In connection with the issuance of options to purchase shares of common stock to non-employees, the Company recorded total stock-based compensation within stockholders’ equity totaling $2,400, $2,100 and $151,400 for the years ended December 31, 2004, 2005 and 2006, respectively.
Comprehensive Income (Loss)
The Company has applied Statement of Financial Accounting Standards No. 130, Reporting Comprehensive Income, which requires that all components of comprehensive income, including net income, be reported in the financial statements in the period in which they are recognized. Comprehensive loss consists of net loss and certain changes in stockholders’ equity that are excluded from net loss. Comprehensive loss for the years ended December 31, 2004, 2005 and 2006 has been reflected in the Statement of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit). Accumulated other comprehensive income (loss), which is included in Stockholders’ Equity (Deficit), represents unrealized gains and losses on investment securities, available-for-sale. Net loss was the same as comprehensive loss for the year ended December 31, 2004.
Net Loss Per Share
Basic net loss per share is calculated by dividing the net loss by the weighted average number of common shares outstanding for the period less the weighted average number of shares subject to repurchase. Diluted net loss per share is computed by dividing the net loss by the weighted average number of common stock equivalents outstanding during the period determined using the treasury stock method. Stock options and shares to be issued upon conversion of the redeemable convertible preferred stock are considered to be common stock equivalents and were not included in the net loss per share calculation for the years ended December 31, 2004, 2005 and 2006 because the inclusion of such shares would have had an anti-dilutive effect.
The unaudited pro forma basic and diluted net loss per share calculations assume the conversion of all outstanding shares of preferred stock into shares of common stock using the as-if-converted method as if such conversion had occurred as of the beginning of each period presented or as of the original issuance date, if later.