GNPX 2017 Annual Report

F-13 Note 8 – Income Taxes The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before provision for income taxes. The sources and tax effects of the differences are as follows: Income tax provision at the federal statutory rate 34% Effect of operating losses -34% 0% At December 31, 2017, the Company has a net operating loss carryforward of approximately $8.0 million for Federal and state purposes. This loss will be available to offset future taxable income. If not used, this carryforward will begin to expire in 2029. The deferred tax asset relating to the operating loss carryforward has been fully reserved at December 31, 2017 and December 31, 2016. The principal differences between the operating loss for income tax purposes and reporting purposes are shares issued for services and share-based compensation and a temporary difference in depreciation expense. Note 9 – Subsequent Events Agreements On March 9, 2018, we entered into a master service agreement with World Wide Holdings LLC dba Invictus Resources. The Company agreed to pay Invictus Resources $85,000 per month for press and investor relations services. On April 16, 2018, we entered into an executive employment agreement with Chief Executive Officer, Rodney Varner. The Company agrees to pay Mr. Varner an annual base salary of $350,000. Mr. Varner is also eligible for a target bonus to be determined, reviewed, and approved by the board of directors. On April 16, 2018, we entered into an executive employment agreement with Chief Financial Officer, Ryan Confer. The Company agrees to pay Mr. Confer an annual base salary of $240,000. Mr. Confer is also eligible for a target bonus to be determined, reviewed, and approved by the board of directors. Promissory Notes On March 9, 2018, we entered into a promissory note with Viet Ly for a total amount of $25,000 that carries a 10% interest rate and is due and payable on or before June 9, 2018.This note was repaid in full on April 6, 2018. On March 28, 2018, we entered into a promissory note with Rodney Varner, Trustee, for a total amount of $45,000 that carries a 10% interest rate and is due and payable on or the earlier of (i) five days after funding of the Company’s initial public offering, or (ii) April 30, 2018. This note was repaid in full on April 5, 2018. Initial Public Offering On April 3, 2018, the Company completed its IPO, whereby the Company sold an aggregate of 1,280,000 shares of its common stock, at $5.00 per share, resulting in estimated net proceeds of $5,025,000 after underwriting discounts, commissions and estimated offering expenses of $895,000. 2018 Equity Incentive Plan The Company’s board of directors and stockholders has approved and adopted the Company’s 2018 Equity Incentive Plan (the 2018 Plan), which became effective on the completion of the IPO on April 3, 2018. The 2018 Plan provides for the grant of incentive stock options (ISOs), nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance-based stock awards, other forms of equity compensation and performance cash awards. ISOs may be granted only to employees. All other awards may be granted to employees, including officers, and to the Company’s non-employee directors and consultants, and affiliates. A total of 4,160,000 shares of Common Stock are available under the 2018 Plan, which includes 554,963 shares of Common Stock reserved for issuance under the 2009 Plan that were added to 2018 Plan. No further grants will be made under the 2009 Plan and any shares subject to outstanding stock options under the 2009 Plan that would otherwise be returned to the 2009 Plan will instead be added to the shares initially reserved under the 2018 Plan.