INCOME TAXES

December 22, 2017,

quasi-territorial tax system, providing a -time transition toll charge on foreign earnings, creating a new limitation on the deductibility of interest expenses and modifying the limitation on officer compensation. The Tax Reform Act permanently reduces the U.S. corporate income tax rate from a maximum of to a flat rate, effective

’s accounting for the Tax Reform Act is incomplete. However, the Securities and Exchange Commission has issued guidance that allows for a measurement period of up to year after the enactment date of the Tax Reform Act to finalize the recording of the related tax impacts. The Company has made reasonable estimates of the effects on the consolidated statements of operations and consolidated balance sheets and has, therefore, recorded provisional amounts. Provisional amounts recorded as of are subject to refinement due to various factors, including, but limited to, changes in interpretations, analysis and assumptions made by the Company, additional guidance that be issued by the U.S. Department of the Treasury and the Internal Revenue Service, and any updates or changes to estimates that the Company has utilized to calculate the transition impact. The Company currently anticipates finalizing and recording any resulting adjustments by As a result of the Tax Reform Act, the Company was required to revalue deferred tax assets and liabilities at the newly enacted U.S. federal corporate income tax rate. This revaluation did result in any additional income tax provision as all deferred tax assets and net operating loss carryforwards have been fully reserved.

’s statutory tax rate to the effective rate for the years ended and is as follows: 

’s deferred tax asset as of and are as follows:

’s ability to generate future taxable income, such as intent and ability to sell assets and historical and projected operating performance. At this time, the Company has established a valuation reserve for all of its deferred tax assets. Such tax assets are available to be recognized and benefit future periods.

 

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and in prior years, the Company performed analyses to determine if there were changes in ownership, as defined by Section of the Internal Revenue Code that would limit its ability to utilize certain net operating loss and tax credit carry forwards. The Company determined that it experienced ownership changes, as defined by Section in connection with certain common stock offerings in and As a result, the utilization of the Company's federal tax net operating loss carry forwards generated prior to the ownership changes are limited. As of the Company has net operating loss carry forwards for U.S. federal and state tax purposes of approximately million, before excluding net operating losses that have been limited as a result of Section limitations. The annual limitation due to Section for net operating loss carry forward utilization is approximately million per year for approximately million in net operating loss carry forwards existing at the ownership change occurring in approximately million per year for approximately million of additional net operating losses occurring from to the ownership change that occurred in approximately million per year for approximately million of additional net operating losses occurring from to the ownership change that occurred in approximately million per year for approximately million of additional net operating losses occurring from to the ownership change that occurred in approximately million per year for approximately million of additional net operating losses occurring from to the ownership change that occurred in approximately million per year for approximately million of additional net operating losses occurring from to the ownership change that occurred in and approximately million per year for approximately million of additional net operating losses occurring from to the ownership change that occurred in The utilization of these net operating loss carry forwards be further limited if the Company experiences future ownership changes as defined in Section of the Internal Revenue Code.