KULR Technology (KULR) 10-Q 14 Aug 20 2020 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2020	Aug. 14, 2020
Document and Entity Information
Document Type	10-Q
Document Period End Date	Jun. 30, 2020
Entity Registrant Name	KULR Technology Group, Inc.
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		82,565,401
Entity Central Index Key	0001662684
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q2
Amendment Flag	false

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Current Assets:
Cash	$ 767,906	$ 108,857
Accounts receivable	72,681	30,101
Subscription receivable	220,000	0
Inventory	40,676	27,091
Prepaid expenses and other current assets	44,320	43,201
Total Current Assets	1,145,583	209,250
Property and equipment, net	51,982	27,516
Total Assets	1,197,565	236,766
Current Liabilities:
Accounts payable	109,536	344,660
Accounts payable - related party	3,622	4,253
Accrued expenses and other current liabilities	466,606	659,399
Accrued expenses and other current liabilities - related party	0	10,419
Accrued issuable equity	290,500	0
Notes payable, net of debt discount of $123,089 and $0 at June 30, 2020 and December 31, 2019, respectively	1,151,911	0
Loans payable, current portion	51,742	0
Line of credit	3,555	0
Deferred revenue	0	15,000
Total Current Liabilities	2,077,472	1,033,731
Loans payable, non-current portion	103,484	0
Total Liabilities	2,180,956	1,033,731
Commitments and contingencies (Note 10)
Stockholders' Deficiency:
Common stock, $0.0001 par value, 500,000,000 shares authorized; 81,759,242 and 81,071,831 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively	8,176	8,107
Additional paid-in capital	8,383,982	7,591,239
Accumulated deficit	(9,375,550)	(8,396,312)
Total Stockholders' Deficiency	(983,391)	(796,965)
Total Liabilities and Stockholders' Deficiency	1,197,565	236,766
Series A Preferred Stock [Member]
Stockholders' Deficiency:
Preferred stock	0	0
Series B Convertible Preferred Stock
Stockholders' Deficiency:
Preferred stock	1	1
Total Stockholders' Deficiency	1	1
Series C Preferred Stock [Member]
Stockholders' Deficiency:
Preferred stock	$ 0	$ 0

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Debt discount, Current	$ 123,089	$ 0
Preferred Stock, Par Value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred Stock, Shares Authorized	20,000,000	20,000,000
Common Stock, Par Value (in dollars per share)	$ 0.0001	$ 0.0001
Common Stock, Shares Authorized	500,000,000	500,000,000
Common Stock, Shares Issued	81,759,242	81,071,831
Common Stock, Shares Outstanding	81,759,242	81,071,831
Series A Preferred Stock [Member]
Preferred Stock, Shares Authorized	1,000,000	1,000,000
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0
Series B Convertible Preferred Stock
Preferred Stock, Shares Authorized	31,000	31,000
Preferred Stock, Shares Issued	14,487	14,487
Preferred Stock, Shares Outstanding	14,487	14,487
Preferred Stock Shares Liquidated Preference	$ 14,487	$ 14,487
Series C Preferred Stock [Member]
Preferred Stock, Shares Authorized	400	400
Preferred Stock, Shares Issued	24.01	24.01
Preferred Stock, Shares Outstanding	24.01	24.01
Preferred Stock Shares Liquidated Preference	$ 240,100	$ 240,100

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Revenue	$ 201,128	$ 56,310	$ 278,628	$ 251,262
Cost of revenue	41,413	28,550	67,339	90,067
Gross Profit	159,715	27,760	211,289	161,195
Operating Expenses:
Research and development	57,991	114,547	169,704	227,739
Selling, general, and administrative	424,865	534,262	894,392	1,119,753
Total Operating Expenses	482,856	648,809	1,064,096	1,347,492
Loss From Operations	(323,141)	(621,049)	(852,807)	(1,186,297)
Other Expenses:
Interest expense, net	(2,353)	(367)	(3,720)	(812)
Amortization of debt discount	(77,691)	0	(96,911)	0
Change in fair value of accrued issuable equity	(25,800)	0	(25,800)	0
Total Other Expenses	(105,844)	(367)	(126,431)	(812)
Net Loss	$ (428,985)	$ (621,416)	$ (979,238)	$ (1,187,109)
Net Loss Per Share - Basic and Diluted (In dollars per share)	$ (0.01)	$ (0.01)	$ (0.01)	$ (0.01)
Weighted Average Number of Common Shares Outstanding - Basic and Diluted (In Shares)	81,234,608	79,918,048	81,166,393	79,365,031

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY - USD ($)	3 Months Ended				6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Mar. 31, 2019	Jun. 30, 2020	Jun. 30, 2019
Balance	$ (1,273,431)	$ (796,965)	$ (499,770)	$ (125,137)	$ (796,965)	$ (125,137)
Stock-based compensation			7,593	36,060
Common stock issued for the commitment fee pursuant to the SEDA agreement	679,437	63,259
Common stock issued for cash			743,300	155,000
Net loss	(428,985)	(550,253)	(621,416)	(565,693)	(979,238)	(1,187,109)
Balance	(983,391)	(1,273,431)	(370,293)	(499,770)	(983,391)	(370,293)
Common Stock
Stock-based compensation	30,000
Stock options
Stock-based compensation	9,588	10,528
Common Stock
Balance	$ 8,117	$ 8,107	$ 7,897	$ 7,871	$ 8,107	$ 7,871
Balance (shares)	81,167,678	81,071,831	78,966,105	78,706,256	81,071,831	78,706,256
Stock-based compensation			$ 0	$ 3
Stock-based compensation (in shares)				25,000
Common stock issued for the commitment fee pursuant to the SEDA agreement	$ 56	$ 10
Common stock issued for the commitment fee pursuant to the SEDA agreement (in shares)	561,564	95,847
Common stock issued for cash			$ 112	$ 23
Common stock issued for cash (in shares)			1,126,210	234,849
Net loss	$ 0	$ 0	$ 0	$ 0
Balance	$ 8,176	$ 8,117	$ 8,009	$ 7,897	$ 8,176	$ 8,009
Balance (shares)	81,759,242	81,167,678	80,092,315	78,966,105	81,759,242	80,092,315
Common Stock | Common Stock
Stock-based compensation	$ 3
Stock-based compensation (in shares)	30,000
Common Stock | Stock options
Stock-based compensation	$ 0	$ 0
Stock-based compensation (in shares)	0	0
Additional Paid-in Capital
Balance	$ 7,665,016	$ 7,591,239	$ 6,474,582	$ 6,283,548	$ 7,591,239	$ 6,283,548
Stock-based compensation			7,593	36,057
Common stock issued for the commitment fee pursuant to the SEDA agreement	679,381	63,249
Common stock issued for cash			743,188	154,977
Net loss	0	0	0	0
Balance	8,383,982	7,665,016	7,225,363	6,474,582	8,383,982	7,225,363
Additional Paid-in Capital | Common Stock
Stock-based compensation	29,997
Additional Paid-in Capital | Stock options
Stock-based compensation	9,588	10,528
Accumulated Deficit
Balance	(8,946,565)	(8,396,312)	(6,982,252)	(6,416,559)	(8,396,312)	(6,416,559)
Stock-based compensation			0	0
Common stock issued for the commitment fee pursuant to the SEDA agreement	0	0
Common stock issued for cash			0	0
Net loss	(428,985)	(550,253)	(621,416)	(565,693)
Balance	(9,375,550)	(8,946,565)	(7,603,668)	(6,982,252)	(9,375,550)	(7,603,668)
Accumulated Deficit | Common Stock
Stock-based compensation	0
Accumulated Deficit | Stock options
Stock-based compensation	0	0
Series B Convertible Preferred Stock
Balance	$ 1	$ 1	$ 3	$ 3	$ 1	$ 3
Balance (shares)	14,487	14,487	30,858	30,858	14,487	30,858
Stock-based compensation			$ 0	$ 0
Stock-based compensation (in shares)			0	0
Common stock issued for cash			$ 0	$ 0
Common stock issued for cash (in shares)			0	0
Net loss			$ 0	$ 0
Balance	$ 1	$ 1	$ 3	$ 3	$ 1	$ 3
Balance (shares)	14,487	14,487	30,858	30,858	14,487	30,858
Series C Convertible Preferred Stock
Balance (shares)	24.01	24.01			24.01
Balance (shares)	24.01	24.01			24.01

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY (Parenthetical)	3 Months Ended
	Jun. 30, 2020USD ($)
Amortized of deferred offering cost	$ 78,258

CONDENSED CONSOLIDATED STATEM_4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Cash Flows From Operating Activities:
Net loss	$ (979,238)	$ (1,187,109)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of debt discount	96,911	0
Depreciation expense	5,534	6,033
Bad debt expense	933	0
Write-down of inventory	0	90
Change in fair value of accrued issuable equity	25,800	0
Stock-based compensation	94,816	93,111
Changes in operating assets and liabilities:
Accounts receivable	(43,513)	49,749
Inventory	(13,585)	1,200
Prepaid expenses and other current assets	(1,119)	(3,824)
Deferred expenses	0	(92,516)
Accounts payable	(235,123)	66,603
Accounts payable - related party	(631)	0
Accrued expenses and other current liabilities	(192,793)	122,781
Accrued expenses and other current liabilities - related party	(10,419)	(25,000)
Deferred revenue	(15,000)	0
Total Adjustments	(288,189)	218,227
Net Cash Used In Operating Activities	(1,267,427)	(968,882)
Cash Flows From Investing Activities:
Purchase of property and equipment	(30,000)	0
Net Cash Used In Investing Activities	(30,000)	0
Cash Flows from Financing Activities:
Proceeds from note payable	1,410,000	0
Repayments of note payable	(84,000)	0
Payment of debt issuance costs	(130,000)	0
Proceeds from Paycheck Protection Program loan	155,226	0
Proceeds (repayments) on line of credit, net	3,555	0
Proceeds from sale of common stock	616,695	898,300
Payment of offering costs	(15,000)	(15,000)
Net Cash Provided By Financing Activities	1,956,476	883,300
Net Increase (Decrease) In Cash	659,049	(85,582)
Cash - Beginning of Period	108,857	229,896
Cash - End of Period	767,906	144,314
Cash paid during the period for:
Cash paid during the period for interest	2,824	446
Non-cash investing and financing activities:
Value of common stock issued as a commitment fee for the SEDA agreement	63,259	0
Deferred offering costs charged to equity	13,042	0
Original issuance discount on note payable	90,000	0
Common stock issued for repayment of note payable	141,000	0
Subscriptions receivable for accrued issuable equity	$ 220,000	$ 0

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical)	6 Months Ended
	Jun. 30, 2020USD ($)
Payments of Stock Issuance Costs	$ 15,000
Common Stock
Gross cash proceeds from common stock	757,695
Proceeds from issuance withheld by investors	$ 141,000

BUSINESS ORGANIZATION AND NATUR

BUSINESS ORGANIZATION AND NATURE OF OPERATIONS	6 Months Ended
	Jun. 30, 2020
BUSINESS ORGANIZATION AND NATURE OF OPERATIONS
BUSINESS ORGANIZATION AND NATURE OF OPERATIONS	NOTE 1 BUSINESS ORGANIZATION AND NATURE OF OPERATIONS Organization and Operations KULR Technology Group, Inc., through its wholly-owned subsidiary, KULR Technology Corporation (collectively referred to as “KULR” or the “Company”), develops and commercializes high-performance thermal management technologies for electronics, batteries, and other components across a range of applications. Currently, the Company is focused on targeting the following applications: electric vehicles and autonomous driving systems (collectively referred to herein as “E-Mobility”); artificial intelligence and Cloud computing; energy storage; and 5G communication technologies. KULR provides heat management solutions to enhance the performance and safety of battery packs used in electric vehicles, communication devices, and aerospace and defense applications. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10‑Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for annual financial statements. In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the unaudited condensed consolidated financial statements of the Company as of June 30, 2020 and for the three and six months ended June 30, 2020 and 2019. The results of operations for the three and six months ended June 30, 2020 are not necessarily indicative of the operating results for the full year ending December 31, 2020 or any other period. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and related disclosures as of December 31, 2019 and for the year then ended, which were filed with the Securities and Exchange Commission (“SEC”) on Form 10-K on May 14, 2020.

GOING CONCERN AND MANAGEMENT'S

GOING CONCERN AND MANAGEMENT'S PLANS	6 Months Ended
	Jun. 30, 2020
GOING CONCERN AND MANAGEMENT'S PLANS
GOING CONCERN AND MANAGEMENT'S PLANS	NOTE 2 GOING CONCERN AND MANAGEMENT’S PLANS The Company has not yet achieved profitability and expects to continue to incur cash outflows from operations. As of June 30, 2020, the Company had cash of $767,906 and a working capital deficit of $931,889. For the six months ended June 30, 2020 and 2019, the Company incurred net losses of $979,238 and $1,187,109, respectively, and used cash in operations of $1,267,427 and $968,882, respectively. It is expected that its research and development and general and administrative expenses will continue to increase and, as a result, the Company will eventually need to generate significant revenues to achieve profitability. Further, as of June 30, 2020, the Company has debt principal (excluding Paycheck Protection Program loans) in the amount of $1,275,000 which matures on May 31, 2021. In January 2020, an outbreak of a new strain of coronavirus, COVID-19, was identified in Wuhan, China. Through the first quarter of 2020, the disease became widespread around the world, and on March 11, 2020, the World Health Organization declared a pandemic. Our business is dependent on developing new markets and new products to be used on a global basis, thus restrictions on travel could lead to reduced demand for our products and interruptions to supply chains. Also, the local regulations such as “Shelter in Place” will affect our ability to maintain regular R&D and manufacturing schedules as well as the capability to meet customer demands in a timely manner. Given the uncertainty around the extent and timing of the potential future spread or mitigation of the Coronavirus and around the imposition or relaxation of protective measures, we cannot reasonably estimate the impact to our future results of operations, cash flows, or financial condition. Effective February 27, 2020, the Company entered into a twenty-four month Standby Equity Distribution Agreement (“SEDA”) with an Investor, pursuant to which the Company may, at its discretion, sell up to an aggregate of $8,000,000 (subject to the Investor’s approval for amounts over $100,000) of shares of the Company’s common stock at a price equal to 80% of the lowest daily volume weighted average price for the five days immediately following the date the Company delivers notice requiring the Investor to purchase the shares under the SEDA. For each advance, the Company shall have delivered all shares relating to all prior advances, and, unless waived by the Investor, at least 5 trading days shall have elapsed from the immediately preceding advance date. See Note 11 – Stockholders’ Deficiency for additional details. Additionally, the Company applied for, and in April 2020, received, a loan of approximately $155,000 under the government Small Business Administration (“SBA”) sponsored Payroll Protection Program (“PPP”) to support continuing employment during the COVID-19 pandemic. As of June 30, 2020, the Company had approximately $7,242,300 available in connection with the SEDA, subject to certain conditions, in order to fund its ongoing operations; however, there can be no assurance that the Company will be able to continue to sell common shares pursuant to the SEDA at an acceptable price, or without causing undue dilution to existing investors. Further, there is also no assurance that the Company will be able to continue to obtain additional funds on commercially acceptable terms, if at all. If the Company is unable to obtain adequate funds on reasonable terms, it may be required to significantly curtail or discontinue operations or obtain funds by entering into financing agreements on unattractive terms. The Company’s operating needs include the planned costs to operate its business, including amounts required to fund working capital and capital expenditures. The aforementioned conditions indicate that there is substantial doubt about the Company’s ability to continue as a going concern within one year after the financial statement issuance date. The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which contemplate continuation of the Company as a going concern and the realization of assets and satisfaction of liabilities in the normal course of business. The unaudited condensed consolidated financial statements do not include any adjustment that might become necessary should the Company be unable to continue as a going concern.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	6 Months Ended
	Jun. 30, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Since the date of the Annual Report on Form 10-K for the year ended December 31, 2019, there have been no material changes to the Company’s significant accounting policies, except as disclosed in this note. Concentrations of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and accounts receivable. A significant portion of the Company’s cash is held at one major financial institution. The Company has not experienced any losses in such accounts. Cash held in US bank institutions is currently insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 at each institution. There was an uninsured balance of $517,906 as of June 30, 2020 and no uninsured cash balances as of December 31, 2019. The Company had certain customers whose revenue individually represented 10% or more of the Company's total revenue, or whose accounts receivable balances individually represented 10% or more of the Company's total accounts receivable, as follows: For the three months ended June 30, 2020 two customers accounted for 44% and 25% of revenues. For the six months ended June 30, 2020, the same two customers accounted for 48% and 18% of revenues. For the three months ended June 30, 2019, three customers accounted for 17%, 18%, and 64% of revenues. For the six months ended June 30, 2019 one of the same customers accounted for 14% and another customer accounted for 47% of revenues. As of June 30, 2020 three customers accounted for 58%, 14%, and 27% of accounts receivable. The customer which accounted for 58% of account receivable as of June 30, 2020 accounted for 25% and 18% of revenues during the three and six months ended June 30, 2020. As of December 31, 2019, four customers accounted for 33%, 17%, 20%, and 19% of accounts receivable. There is no assurance the Company will continue to receive significant revenues from any of these customers. Any reduction or delay in operating activity from any of the Company’s significant customers, or a delay or default in payment by any significant customer, or termination of agreements with significant customers, could materially harm the Company’s business and prospects. As a result of the Company’s significant customer concentrations, its gross profit and results from operations could fluctuate significantly due to changes in political, environmental, or economic conditions, or the loss of, reduction of business from, or less favorable terms with any of the Company’s significant customers. Vendor Concentrations Vendor concentrations are as follows: Accounts Payable As of As of June 30, 2020 December 31, 2019 Vendor A 18 % 15 % Vendor B * 16 % Vendor C * 17 % Vendor D 22 % 12 % Vendor E 24 % * 64 % 60 % * Revenue Recognition The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers” (“ASC 606”). The core principle of ASC 606 requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. ASC 606 defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. The following five steps are applied to achieve that core principle: · Step 1 : Identify the contract with the customer; · Step 2 : Identify the performance obligations in the contract; · Step 3 : Determine the transaction price; · Step 4 : Allocate the transaction price to the performance obligations in the contract; and · Step 5 : Recognize revenue when the company satisfies a performance obligation. The Company recognizes revenue primarily from the following different types of contracts: · Product sales – Revenue is recognized at the point in time the customer obtains control of the goods and the Company satisfies its performance obligation, which is generally at the time it ships the product to the customer. · Contract services – Revenue is recognized at the point in time that the Company satisfies its performance obligation under the contract, which is generally at the time it delivers a report to the customer. The following table summarizes the revenue recognized in the unaudited condensed consolidated statements of operations: For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 Product sales $ 67,130 $ 52,310 $ 99,130 $ 221,750 Contract services 133,998 4,000 179,498 29,512 Total revenue $ 201,128 $ 56,310 $ 278,628 $ 251,262 As of June 30, 2020 and December 31, 2019, the Company had $0 and $15,000, respectively, of deferred revenue, from contracts with customers. The contract liabilities represent payments received from customers for which the Company had not yet satisfied its performance obligation under the contract. During the three and six months ended June 30, 2020, there was $15,000 of revenue recognized from performance obligations satisfied (or partially satisfied) in previous periods. Sequencing Policy Under ASC 815-40-35 (“ASC 815”), the Company has adopted a sequencing policy, whereby, in the event that reclassification of contracts from equity to assets or liabilities is necessary pursuant to ASC 815 due to the Company’s inability to demonstrate it has sufficient authorized shares as a result of certain securities with a potentially indeterminable number of shares, shares will be allocated on the basis of the earliest issuance date of potentially dilutive instruments, with the earliest grants receiving the first allocation of shares. Pursuant to ASC 815, issuances of securities to the Company’s employees and directors, or to compensate grantees in a share-based payment arrangement, are not subject to the sequencing policy. Net Loss Per Common Share Basic net loss per common share is computed by dividing net loss by the weighted average number of vested common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding, plus the impact of common share, if dilutive, resulting from the exercise of outstanding stock options and warrants and the conversion of convertible instruments. The following shares were excluded from the calculation of weighted average dilutive common shares because their inclusion would have been anti-dilutive: For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 Series B Convertible Preferred Stock 724,350 1,542,900 724,350 1,542,900 Series C Convertible Preferred Stock 240,100 — 240,100 — Options 395,000 300,000 395,000 300,000 Warrants 210,025 — 210,025 — Total 1,569,475 1,842,900 1,569,475 1,842,900 Reclassifications Certain prior period balances have been reclassified in order to conform to the current period presentation. These reclassifications have no effect on previously reported results of operations or loss per share.

PREPAID EXPENSES

PREPAID EXPENSES	6 Months Ended
	Jun. 30, 2020
PREPAID EXPENSES
PREPAID EXPENSES	NOTE 4 PREPAID EXPENSES As of June 30, 2020 and December 31, 2019, prepaid expenses consisted of the following: June 30, December 31, 2020 2019 Filing fees $ 15,873 $ 13,358 Professional fees 9,750 — Security deposit 8,728 16,977 Other 6,321 4,840 Insurance 3,648 8,026 Total prepaid expenses $ 44,320 $ 43,201

ACCRUED EXPENSES AND OTHER CURR

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES	6 Months Ended
	Jun. 30, 2020
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES	NOTE 5 ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES As of June 30, 2020 and December 31, 2019, accrued expenses and other current liabilities consisted of the following: June 30, December 31, 2020 2019 Payroll and vacation $ 409,395 $ 525,917 Legal and professional fees 41,625 60,000 Other 15,586 73,482 Total accrued expenses and other current liabilities $ 466,606 $ 659,399 See Note 10 – Related Party Transactions for more information on accrued expenses – related party.

ACCRUED ISSUABLE EQUITY

ACCRUED ISSUABLE EQUITY	6 Months Ended
	Jun. 30, 2020
ACCRUED ISSUABLE EQUITY
ACCRUED ISSUABLE EQUITY	NOTE 6 ACCRUED ISSUABLE EQUITY As of June 30, 2020, accrued issuable equity consists of the following: June 30, 2020 Accrued issuable equity for services $ 70,500 Accrued issuable equity for subscriptions receivable 220,000 $ 290,500 Accrued Issuable Equity for Services During the three and six months ended June 30, 2020,the Company agreed to issue 55,000 and 58,333 shares of common stock to vendors in exchange for services valued at $42,500 and $44,700,respectively (see Note 11 – Stockholders’ Deficiency, Stock-Based Compensation). The shares have not been issued as of June 30, 2020. The fair value of the unissued shares as of June 30, 2020 was $70,500;accordingly, the Company recorded a change in the fair value of accrued issuable equity related to these shares of $25,800 for the six months ended June 30, 2020. Accrued Issuable Equity for Subscriptions Receivable Between June 29, 2020 and June 30, 2020, the Company delivered notices requiring the Investor to purchase $220,000 of shares under the SEDA, at a price per share equal to 80% of the lowest daily volume weighted average price at which the shares are traded for the five days immediately following the date the Company delivered such notice.

LINE OF CREDIT

LINE OF CREDIT	6 Months Ended
	Jun. 30, 2020
LINE OF CREDIT
LINE OF CREDIT	NOTE 7 LINE OF CREDIT On February 18, 2020, the Company entered into a financing agreement (the “Line of Credit”) wherein it may borrow up to $10,000. The repayment terms (interest rate, repayment amount and number of consecutive weekly periodic installments) are determined at the time the Company borrows proceeds under the Line of Credit. On February 19, 2020, the Company borrowed and received gross proceeds of $10,000 under the Line of Credit for its working capital needs, which is being repaid weekly for the next 26 weeks at a weekly interest rate of 1.7%. As of June 30, 2020, the outstanding aggregate principal amount on the Line of Credit was $3,555. During the three and six months ended June 30, 2020, the Company recorded interest expense of $1,382 and $2,178, respectively, related to the Line of Credit. There was no accrued interest related to the Line of Credit as of June 30, 2020. The outstanding balance of the line of credit was paid off in July 2020.

NOTE PAYABLE

NOTE PAYABLE	6 Months Ended
	Jun. 30, 2020
NOTE PAYABLE
NOTE PAYABLE	NOTE 8 NOTE PAYABLE On February 27, 2020, the Company entered into a note purchase agreement with the YAII PN, Ltd., a Cayman Island exempt limited partnership (the “Investor”), pursuant to which the Investor purchased a full recourse promissory note (the “Note”) in the original principal amount of $1,500,000 (“Principal Amount”) for cash proceeds of $1,410,000. The Note included an original issue discount of $90,000, which represents the difference between the principal and proceeds received. The original issue discount, along with the $130,000 advisory fee were recorded as a debt discount which is being amortized over the term of the Note using the effective interest rate method. The Note bears no coupon interest (original issue discount only) and will become immediately due and payable on May 31, 2021 or upon acceleration, redemption or otherwise upon the occurrence of an event of default, as set forth in the Note and which includes the early termination of a standby equity distribution agreement with the Investor (see Note 11 – Stockholders’ Deficiency – Standby Equity Distribution Agreement for additional information). The Company is required to repay the Principal Amount in monthly installments as set forth in the agreement. The Company may, at its discretion, prepay any installment amount or the principal amount, subject to a payment premium equal to the 10% of the amount being prepaid. During the six months ended June 30, 2020, the Company repaid principal on the Note of $225,000. As of June 30, 2020, the outstanding aggregate principal balance of the Note was $1,275,000. During the three and six months ended June 30, 2020, the Company recognized amortization of debt discount of $77,691 and $96,911, respectively, related to the Note. Please see Note 13 - Subsequent Events for additional information regarding further repayments of the Note.

LOAN PAYABLE

LOAN PAYABLE	6 Months Ended
	Jun. 30, 2020
LOAN PAYABLE
LOAN PAYABLE	NOTE 9 LOAN PAYABLE On April 27, 2020, the Company received approximately $155,000 of cash proceeds pursuant to an unsecured loan provided in connection with the Paycheck Protection Program ("PPP") under the Coronavirus Aid, Relief, and Economic Security Act and applicable regulations ("CARES Act"). Under the terms of the CARES Act, as amended by the Paycheck Protection Program Flexibility Act of 2020, the Company is eligible to apply for and receive forgiveness for all or a portion of their respective PPP Loans. Such forgiveness will be determined, subject to limitations, based on the use of the loan proceeds for certain permissible purposes as set forth in the PPP, including, but not limited to, payroll costs (as defined under the PPP) and mortgage interest, rent or utility costs (collectively, "Qualifying Expenses") incurred during the 24 weeks subsequent to funding, and on the maintenance of employee and compensation levels, as defined, following the funding of the PPP Loan. The Company intends to use the proceeds of their PPP Loans for Qualifying Expenses. However, no assurance is provided that KULR will be able to obtain forgiveness of the PPP Loans in whole or in part. Any amounts not forgiven incur interest at 1.0% per annum and monthly repayments of principal and interest are deferred until the Small Business Administration decides on forgiveness. While the Company's PPP loans currently have a two-year maturity, the amended law will permit the Company to request a five-year maturity, subject to the approval of the counterparty. During the three and six months ended June 30, 2020, the Company recognized interest expense of $272. As of June 30, 2020 and December 31, 2019, the Company's accrued interest related to the loan was $272 and $0, respectively.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	6 Months Ended
	Jun. 30, 2020
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS	NOTE 10 RELATED PARTY TRANSACTIONS Accounts Payable – Related Party Accounts payable – related party consists of a liability of $3,622 and $4,253 as of June 30, 2020 and December 31, 2019, respectively, to Energy Science Laboratories, Inc. (“ESLI”), a company controlled by the Company’s Chief Technology Officer (“CTO”), in connection with consulting services provided to the Company associated with the development of the Company’s CFV thermal management solutions in prior periods. Accrued Expenses and Other Current Liabilities – Related Party Accrued expenses and other current liabilities – related party consist of a liability of $0 and $10,419 as of June 30, 2020 and December 31, 2019, respectively, to Energy Science Laboratories, Inc. (“ESLI”), a company controlled by the Company’s Chief Technology Officer (“CTO”), in connection with consulting services provided by ESLI to the Company associated with the development of the Company’s CFV thermal management solutions.

STOCKHOLDERS' DEFICIENCY

STOCKHOLDERS' DEFICIENCY	6 Months Ended
	Jun. 30, 2020
STOCKHOLDERS' DEFICIENCY
STOCKHOLDERS' DEFICIENCY	NOTE 11 STOCKHOLDERS’ DEFICIENCY Standby Equity Distribution Agreement On February 27, 2020, KULR Technology Group, Inc. entered into a SEDA with the Investor, pursuant to which the Company may, at its discretion, sell to the Investor up to $8,000,000 of shares of the Company’s common stock (the “Offering”), par value $0.0001 per share (the “Common Stock”). For each share of Common Stock purchased under the SEDA (the “Shares”), the Investor will pay the Company 80% of the lowest daily volume weighted average price of the Common Stock on the OTC Markets OTCQB or other principal market on which the Common Stock is traded for the five days immediately following the date the Company delivers notice requiring the Investor to purchase the Shares under the SEDA. The Investor’s obligation to purchase the Shares under the SEDA is subject to certain conditions, including the Company maintaining the effectiveness of a registration statement for the securities sold under the SEDA, and subject to the Investor’s approval for amounts over $100,000. In addition, the Company may not request advances if the Shares to be issued would result in the Investor owning more than 4.99% of the Company’s outstanding Common Stock, with any such request being automatically modified to reduce the advance amount. The Company shall not be able to request advances under the SEDA if the Registration Statement is not effective or if any issuances of Common Stock pursuant to any Advances would violate any rules. The commitment period under the SEDA commenced on February 27, 2020 (the “Effective Date”) and expires on the earliest to occur of (i) first day of the month following the twenty-four months after the Effective Date, (ii) the date on which the Investor has purchased an aggregate amount of $8,000,000 of Shares under the SEDA, or (iii) the date the SEDA is earlier terminated. The SEDA contains customary representations, warranties and agreements of the Company and the Investor, indemnification rights and other obligations of the parties. The Company has the right to terminate the SEDA at any time upon prior written notice, at no cost to the Company, provided that (i) there are no outstanding advances which have yet to be issued and (ii) the Company has paid all amounts owed to the Investor, including amounts borrowed under the Note (see Note 8 – Note Payable for additional information). The Investor has covenanted not to cause or engage in any manner whatsoever, any direct or indirect short selling or hedging of the Company’s shares of Common Stock. The Company paid cash of $15,000 and issued to the Investor 95,847 shares of Common Stock to the Investor and as consideration for entering into the SEDA. The shares of common stock issued to the Investor had an issuance date fair value of $63,259. The aggregate consideration of $78,259 was recorded as deferred offering costs and additional paid in capital on the condensed consolidated balance sheet. During the three and six months ended June 30, 2020 , the Company recorded $78,259 of amortization expense related to deferred offering costs. During the three and six months ended June 30, 2020 the Company issued an aggregate of 561,564 shares of common stock at prices between $0.72 - $1.62 per share for aggregate proceeds of $757,695 received against advance notices submitted to the Investor under the SEDA, of which $141,000 of the proceeds were applied directly against the note payable. Please see Note 8 – Note Payable for more information. Between June 29, 2020 and June 30, 2020, the Company delivered notices requiring the Investor to purchase under the SEDA $220,000. The shares had not been issued as of June 30, 2020. The value of the shares to be delivered pursuant to these notices is recorded as subscriptions receivable and accrued issuable equity on the accompanying condensed consolidated balance sheet. See Note 6 – Accrued Issuable Equity. Please see Note 13 - Subsequent Events for additional information regarding the sale of Shares subsequent to June 30, 2020. Stock-Based Compensation Common Stock During the six months ended June 30, 2020, the Company issued 30,000 shares of common stock that vested immediately with a grant date value of approximately $30,000 related to consulting services provided. During the six months ended June 30, 2019, the Company issued 25,000 shares, with a grant date value of $36,060 for legal fees. Stock Options On January 1, 2020, the Company granted five-year options to purchase a total of 10,000 shares of common stock at an exercise price of $0.66 per share to an employee pursuant to the 2018 Plan. One-fourth of the options will vest on the first-year anniversary of the grant date and the remaining options vest monthly over three years. The options had an aggregate grant date value of $3,609 which is recognized over the vesting period. The Company estimated the fair value of the options using the Black-Scholes Option Pricing Model with the following assumptions: (a) stock price of $0.66 per share; (b) volatility of 93%; (c) expected term of 2.5 years; (d) risk-free interest rate of 1.58%; and (e) a dividend rate of 0.0%. Stock-Based Compensation Expense During the three and six months ended June 30, 2020, the Company recognized stock-based compensation expense of $82,088 and $94,816, respectively, related to restricted common stock and stock options, of which $2,163 and $10,275, respectively was charged to research and development expense and $79,925 and $84,541, respectively was charged to general and administrative expense. As of June 30, 2020, there was $76,329 of unrecognized stock-based compensation expense that will be recognized over the weighted average remaining vesting period of 2.0 years. During the three and six months ended June 30, 2019, the Company recognized stock-based compensation expense of $45,171 and $93,111, respectively, related to restricted common stock, stock options and warrants, which are included within general and administrative expenses on the condensed consolidated statements of operations. The following table presents information related to stock-based compensation for the three and six months ended June 30, 2020 and 2019: For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 Common stock (issued) $ 30,000 $ — $ 30,000 $ 36,060 Stock options 9,588 7,593 20,116 7,593 Accrued issuable equity (common stock) 42,500 37,578 44,700 28,971 Accrued issuable equity (warrants) — — — 20,487 Total $ 82,088 $ 45,171 $ 94,816 $ 93,111

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Jun. 30, 2020
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES	NOTE 12 COMMITMENTS AND CONTINGENCIES Operating Lease On June 15, 2020, the Company entered into an agreement to extend the term of its original lease from June 30, 2020 to December 31, 2020. Monthly rental payments under the renewed lease total $5,107, which are comprised of $4,552 of base rent plus $555 of association fees. For the three and six months ended June 30, 2020, operating lease expense was $17,200 and $27,216, respectively. For the three and six months ended June 30, 2019, operating lease expense was $40,103 and $80,488, respectively. The Company evaluated their operating lease and determined that the short-term exemption available under ASC 842 applies since the lease term is less than 12 months and the lease does not include a purchase option whose exercise is reasonably certain. Since the short-term exemption applies, lease payments are recognized as expense and no right of use asset or lease liability is recorded.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2020
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	NOTE 13 SUBSEQUENT EVENTS Common Stock On July 1, 2020, the Company issued 35,000 shares of immediately vested common stock with a grant date value of approximately $25,000 for legal fees. Standby Equity Distribution Agreement and Repayments of the Note Payable Subsequent to June 30, 2020, the Company received cash of $220,000 in satisfaction of subscriptions receivable as of June 30, 2020. See Note 6 – Accrued Issuable Equity, Accrued Issuable Equity for Subscriptions Receivable. Subsequent to June 30, 2020, the Company issued an aggregate of 771,159 shares of common stock at prices between $0.96 - $1.65 per share for aggregate net proceeds of $745,000 received against advance notices submitted to the Investor under the SEDA , which consists of gross proceeds of $915,000 less $170,000 withheld by the Investor to pay down a portion of the Note. See Note 11 Stockholders' Deficiency – Standby Equity Distribution Agreement and Note 8 – Note Payable. New Note Purchase Agreement and Promissory Note The Company also entered into a Note Purchase Agreement, dated July 20, 2020, with the Investor, pursuant to which the Investor purchased a full recourse promissory note (the "July 2020 Note") in the original principal amount of $2,500,000 ("July 2020 Principal Amount"). In consideration for the issuance of the July 2020 Note by the Company, the purchase price of the Note paid by the Investor was equal to the July 2020 Principal Amount minus an 8% commitment fee and a $10,000 structuring fee. The July 2020 Note bears no interest and will become immediately due and payable on July 20, 2021 or upon acceleration, redemption or otherwise upon the occurrence of an event of default, as set forth in the July 2020 Note. The Company will repay the July 2020 Principal Amount in monthly installments as set forth in the July 2020 Note. The Company may, at its discretion, prepay any installment amount or the principal amount, subject to a payment premium equal to the 10% of the amount being prepaid. The Company paid a financial advisor a $200,000 advisory fee in connection with the July 2020 Note Purchase Agreement and Note.

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Concentrations of Credit Risk	Concentrations of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and accounts receivable. A significant portion of the Company’s cash is held at one major financial institution. The Company has not experienced any losses in such accounts. Cash held in US bank institutions is currently insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 at each institution. There was an uninsured balance of $517,906 as of June 30, 2020 and no uninsured cash balances as of December 31, 2019. The Company had certain customers whose revenue individually represented 10% or more of the Company's total revenue, or whose accounts receivable balances individually represented 10% or more of the Company's total accounts receivable, as follows: For the three months ended June 30, 2020 two customers accounted for 44% and 25% of revenues. For the six months ended June 30, 2020, the same two customers accounted for 48% and 18% of revenues. For the three months ended June 30, 2019, three customers accounted for 17%, 18%, and 64% of revenues. For the six months ended June 30, 2019 one of the same customers accounted for 14% and another customer accounted for 47% of revenues. As of June 30, 2020 three customers accounted for 58%, 14%, and 27% of accounts receivable. The customer which accounted for 58% of account receivable as of June 30, 2020 accounted for 25% and 18% of revenues during the three and six months ended June 30, 2020. As of December 31, 2019, four customers accounted for 33%, 17%, 20%, and 19% of accounts receivable. There is no assurance the Company will continue to receive significant revenues from any of these customers. Any reduction or delay in operating activity from any of the Company’s significant customers, or a delay or default in payment by any significant customer, or termination of agreements with significant customers, could materially harm the Company’s business and prospects. As a result of the Company’s significant customer concentrations, its gross profit and results from operations could fluctuate significantly due to changes in political, environmental, or economic conditions, or the loss of, reduction of business from, or less favorable terms with any of the Company’s significant customers. Vendor Concentrations Vendor concentrations are as follows: Accounts Payable As of As of June 30, 2020 December 31, 2019 Vendor A 18 % 15 % Vendor B * 16 % Vendor C * 17 % Vendor D 22 % 12 % Vendor E 24 % * 64 % 60 % *
Revenue Recognition	Revenue Recognition The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers” (“ASC 606”). The core principle of ASC 606 requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. ASC 606 defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. The following five steps are applied to achieve that core principle: · Step 1 : Identify the contract with the customer; · Step 2 : Identify the performance obligations in the contract; · Step 3 : Determine the transaction price; · Step 4 : Allocate the transaction price to the performance obligations in the contract; and · Step 5 : Recognize revenue when the company satisfies a performance obligation. The Company recognizes revenue primarily from the following different types of contracts: · Product sales – Revenue is recognized at the point in time the customer obtains control of the goods and the Company satisfies its performance obligation, which is generally at the time it ships the product to the customer. · Contract services – Revenue is recognized at the point in time that the Company satisfies its performance obligation under the contract, which is generally at the time it delivers a report to the customer. The following table summarizes the revenue recognized in the unaudited condensed consolidated statements of operations: For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 Product sales $ 67,130 $ 52,310 $ 99,130 $ 221,750 Contract services 133,998 4,000 179,498 29,512 Total revenue $ 201,128 $ 56,310 $ 278,628 $ 251,262 As of June 30, 2020 and December 31, 2019, the Company had $0 and $15,000, respectively, of deferred revenue, from contracts with customers. The contract liabilities represent payments received from customers for which the Company had not yet satisfied its performance obligation under the contract. During the three and six months ended June 30, 2020, there was $15,000 of revenue recognized from performance obligations satisfied (or partially satisfied) in previous periods.
Sequencing Policy	Sequencing Policy Under ASC 815-40-35 (“ASC 815”), the Company has adopted a sequencing policy, whereby, in the event that reclassification of contracts from equity to assets or liabilities is necessary pursuant to ASC 815 due to the Company’s inability to demonstrate it has sufficient authorized shares as a result of certain securities with a potentially indeterminable number of shares, shares will be allocated on the basis of the earliest issuance date of potentially dilutive instruments, with the earliest grants receiving the first allocation of shares. Pursuant to ASC 815, issuances of securities to the Company’s employees and directors, or to compensate grantees in a share-based payment arrangement, are not subject to the sequencing policy.
Net Loss Per Common Share	Net Loss Per Common Share Basic net loss per common share is computed by dividing net loss by the weighted average number of vested common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding, plus the impact of common share, if dilutive, resulting from the exercise of outstanding stock options and warrants and the conversion of convertible instruments. The following shares were excluded from the calculation of weighted average dilutive common shares because their inclusion would have been anti-dilutive: For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 Series B Convertible Preferred Stock 724,350 1,542,900 724,350 1,542,900 Series C Convertible Preferred Stock 240,100 — 240,100 — Options 395,000 300,000 395,000 300,000 Warrants 210,025 — 210,025 — Total 1,569,475 1,842,900 1,569,475 1,842,900
Reclassifications	Reclassifications Certain prior period balances have been reclassified in order to conform to the current period presentation. These reclassifications have no effect on previously reported results of operations or loss per share.

SUMMARY OF SIGNIFICANT ACCOUN_3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	6 Months Ended
	Jun. 30, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Schedule of concentrations of credit risk	Accounts Payable As of As of June 30, 2020 December 31, 2019 Vendor A 18 % 15 % Vendor B * 16 % Vendor C * 17 % Vendor D 22 % 12 % Vendor E 24 % * 64 % 60 % *
Schedule of revenue recognized	For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 Product sales $ 67,130 $ 52,310 $ 99,130 $ 221,750 Contract services 133,998 4,000 179,498 29,512 Total revenue $ 201,128 $ 56,310 $ 278,628 $ 251,262
Schedule of weighted average dilutive common shares because their inclusion would have been anti-dilutive	For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 Series B Convertible Preferred Stock 724,350 1,542,900 724,350 1,542,900 Series C Convertible Preferred Stock 240,100 — 240,100 — Options 395,000 300,000 395,000 300,000 Warrants 210,025 — 210,025 — Total 1,569,475 1,842,900 1,569,475 1,842,900

PREPAID EXPENSES (Tables)

PREPAID EXPENSES (Tables)	6 Months Ended
	Jun. 30, 2020
PREPAID EXPENSES
Schedule of prepaid expenses	June 30, December 31, 2020 2019 Filing fees $ 15,873 $ 13,358 Professional fees 9,750 — Security deposit 8,728 16,977 Other 6,321 4,840 Insurance 3,648 8,026 Total prepaid expenses $ 44,320 $ 43,201

ACCRUED EXPENSES AND OTHER CU_2

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)	6 Months Ended
	Jun. 30, 2020
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Schedule of accrued expenses and other current liabilities	June 30, December 31, 2020 2019 Payroll and vacation $ 409,395 $ 525,917 Legal and professional fees 41,625 60,000 Other 15,586 73,482 Total accrued expenses and other current liabilities $ 466,606 $ 659,399

ACCRUED ISSUABLE EQUITY (Tables

ACCRUED ISSUABLE EQUITY (Tables)	6 Months Ended
	Jun. 30, 2020
ACCRUED ISSUABLE EQUITY
Schedule of accrued issuable equity	June 30, 2020 Accrued issuable equity for services $ 70,500 Accrued issuable equity for subscriptions receivable 220,000 $ 290,500

STOCKHOLDERS' DEFICIENCY (Table

STOCKHOLDERS' DEFICIENCY (Tables)	6 Months Ended
	Jun. 30, 2020
STOCKHOLDERS' DEFICIENCY
Schedule of Information relating to stock based compensation	For the Three Months Ended For the Six Months Ended June 30, June 30, 2020 2019 2020 2019 Common stock (issued) $ 30,000 $ — $ 30,000 $ 36,060 Stock options 9,588 7,593 20,116 7,593 Accrued issuable equity (common stock) 42,500 37,578 44,700 28,971 Accrued issuable equity (warrants) — — — 20,487 Total $ 82,088 $ 45,171 $ 94,816 $ 93,111

GOING CONCERN AND MANAGEMENT'_2

GOING CONCERN AND MANAGEMENT'S PLANS (Details) - USD ($)	Feb. 27, 2020	Apr. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Mar. 31, 2019	Jun. 30, 2020	Jun. 30, 2019	Feb. 18, 2020	Dec. 31, 2019	Dec. 31, 2018
Cash			$ 767,906		$ 144,314		$ 767,906	$ 144,314		$ 108,857	$ 229,896
Working capital deficit			931,889				931,889
Net loss			(428,985)	$ (550,253)	$ (621,416)	$ (565,693)	(979,238)	(1,187,109)
Cash used in operations							(1,267,427)	$ (968,882)
Maximum borrowing capacity under Line of credit									$ 10,000
Paycheck Protection Program Loan
Loan proceeds received		$ 155,000
Standby Equity Distribution Agreement
Commitment period	24 months
Value of shares authorized to be issued under the SEDA agreement	$ 8,000,000
Investor's obligation to purchase, per advance amount	$ 100,000
Lowest daily volume weighted average price of the Common Stock to be paid (as a percent)	80.00%
Maximum borrowing capacity under Line of credit			7,242,300				7,242,300
Total Loans Excluding Paycheck Protection Program Loans [Member]
Debt principal amount			$ 1,275,000				$ 1,275,000
Maturity Date							May 31, 2021

SUMMARY OF SIGNIFICANT ACCOUN_4

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Customer concentrations (Details) - customer	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Revenues [Member]
Number of customers	2	3	2
Accounts Receivable [Member]
Number of customers			3		4
Accounts Payable [Member]
Concentration Risk, Percentage			64.00%		60.00%
Customer A [Member] | Revenues [Member]
Concentration Risk, Percentage				47.00%
Customer C [Member] | Accounts Receivable [Member]
Concentration Risk, Percentage					33.00%
Customer D [Member] | Accounts Receivable [Member]
Concentration Risk, Percentage					17.00%
Customer E [Member] | Accounts Receivable [Member]
Concentration Risk, Percentage					20.00%
Customer F [Member] | Accounts Receivable [Member]
Concentration Risk, Percentage					19.00%
Customer G [Member] | Revenues [Member]
Concentration Risk, Percentage	25.00%		18.00%
Customer G [Member] | Revenues [Member] | Customer One
Concentration Risk, Percentage	44.00%		48.00%
Customer G [Member] | Accounts Receivable [Member]
Concentration Risk, Percentage			58.00%
Customer J [Member] | Revenues [Member] | Customer Two
Concentration Risk, Percentage	25.00%		18.00%
Customer K [Member] | Revenues [Member]
Concentration Risk, Percentage		17.00%
Customer L [Member] | Revenues [Member]
Concentration Risk, Percentage		18.00%
Customer M [Member] | Revenues [Member]
Concentration Risk, Percentage		64.00%		14.00%
Customer N [Member] | Accounts Receivable [Member]
Concentration Risk, Percentage			14.00%
Customer O [Member] | Accounts Receivable [Member]
Concentration Risk, Percentage			27.00%
Vendor A [Member] | Accounts Payable [Member]
Concentration Risk, Percentage			18.00%		15.00%
Vendor B [Member] | Accounts Payable [Member]
Concentration Risk, Percentage					16.00%
Vendor C [Member] | Accounts Payable [Member]
Concentration Risk, Percentage					17.00%
Vendor D [Member] | Accounts Payable [Member]
Concentration Risk, Percentage			22.00%		12.00%
Vendor E [Member] | Accounts Payable [Member]
Concentration Risk, Percentage			24.00%

SUMMARY OF SIGNIFICANT ACCOUN_5

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES- consolidated statements of operations: (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Disaggregation of Revenue [Line Items]
Revenue from Contract with Customer, Excluding Assessed Tax	$ 201,128	$ 56,310	$ 278,628	$ 251,262
Product sales [Member]
Disaggregation of Revenue [Line Items]
Revenue from Contract with Customer, Excluding Assessed Tax	67,130	52,310	99,130	221,750
Contract services [Member]
Disaggregation of Revenue [Line Items]
Revenue from Contract with Customer, Excluding Assessed Tax	$ 133,998	$ 4,000	$ 179,498	$ 29,512

SUMMARY OF SIGNIFICANT ACCOUN_6

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - weighted average dilutive common shares (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	1,569,475	1,842,900	1,569,475	1,842,900
Series B Convertible Preferred Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	724,350	1,542,900	724,350	1,542,900
Series C Convertible Preferred Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	240,100		240,100
options
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	395,000	300,000	395,000	300,000
Warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	210,025		210,025

SUMMARY OF SIGNIFICANT ACCOUN_7

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) - USD ($)	3 Months Ended	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2020	Dec. 31, 2019
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Cash, FDIC Insured Amount	$ 250,000	$ 250,000
Uninsured cash	517,906	517,906	$ 0
Deferred revenue	0	0	$ 15,000
Revenue Recognized	$ 15,000	$ 15,000

PREPAID EXPENSES (Details)

PREPAID EXPENSES (Details) - Business development services [Member] - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Filing fees	$ 15,873	$ 13,358
Professional fees	9,750
Security deposit	8,728	16,977
Other	6,321	4,840
Insurance	3,648	8,026
Total prepaid expenses	$ 44,320	$ 43,201

ACCRUED EXPENSES AND OTHER CU_3

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Payroll and vacation	$ 409,395	$ 525,917
Legal and professional fees	41,625	60,000
Other	15,586	73,482
Total accrued expenses and other current liabilities	$ 466,606	$ 659,399

ACCRUED ISSUABLE EQUITY (Detail

ACCRUED ISSUABLE EQUITY (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
ACCRUED ISSUABLE EQUITY
Accrued issuable equity for services	$ 70,500
Accrued issuable equity for subscriptions receivable	220,000
Accrued issuable equity, Total	$ 290,500	$ 0

ACCRUED ISSUABLE EQUITY - Addit

ACCRUED ISSUABLE EQUITY - Additional information (Details) - USD ($)	Jun. 30, 2020	Jun. 30, 2020	Jun. 30, 2020	Jun. 29, 2020
Shares to be issued for services (in shares)		55,000	58,333
Value of services		$ 42,500	$ 44,700
Fair value of unissued equity	$ 70,500	70,500	70,500
Change in Fair value			25,800
Accrued issuable equity for subscriptions receivable	220,000	220,000	220,000
Standby Equity Distribution Agreement
Accrued issuable equity for subscriptions receivable	$ 220,000	$ 220,000	$ 220,000	$ 220,000
Price per share (as a percent)	80.00%
Threshold trading days	5 days

LINE OF CREDIT (Details)

LINE OF CREDIT (Details) - USD ($)	Feb. 19, 2020	Jun. 30, 2020	Jun. 30, 2020	Feb. 18, 2020	Dec. 31, 2019
LINE OF CREDIT
Maximum borrowing capacity				$ 10,000
Gross proceeds under line of credit	$ 10,000
Loan maturity term	182 days
Interest rate	1.70%
Outstanding line of credit		$ 3,555	$ 3,555		$ 0
Interest expense		$ 1,382	2,178
Accrued interest			$ 0

NOTE PAYABLE (Details)

NOTE PAYABLE (Details) - USD ($)	Feb. 27, 2020	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Debt Instrument [Line Items]
Proceeds from notes payable				$ 1,410,000	$ 0
Original issuance discount on note payable				90,000	0
Amortization of debt discount		$ 77,691	$ 0	$ 96,911	$ 0
Note payable
Debt Instrument [Line Items]
Aggregate principal amount	$ 1,500,000
Proceeds from notes payable	1,410,000
Advisory fees paid to financial advisor	130,000
Original issuance discount on note payable	$ 90,000
Prepayment premium (as a percentage)		10.00%		10.00%
Repayments of note payable				$ 225,000
Outstanding aggregate principal balance		$ 1,275,000		1,275,000
Amortization of debt discount		$ 77,691		$ 96,911

LOAN PAYABLE (Details)

LOAN PAYABLE (Details) - USD ($)	Apr. 27, 2020	Feb. 19, 2020	Jun. 30, 2020	Jun. 30, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Loan maturity term		182 days
Payment Protection Loans
Debt Instrument [Line Items]
Cash proceeds from unsecured loan	$ 155,000
Interest rate (as a percentage)	1.00%
Loan maturity term	2 years
Extended maturity term	5 years
Interest expense of loan			$ 272	$ 272
Accrued interest related to the loan			$ 272	$ 272	$ 0

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Related Party Transaction [Line Items]
Accounts payable - related party	$ 3,622	$ 4,253
Accrued expenses and other current liabilities - related party	0	10,419
Chief Technology Officer CTO [Member]
Related Party Transaction [Line Items]
Accounts payable - related party	$ 3,622	$ 4,253

STOCKHOLDERS' DEFICIENCY - Stan

STOCKHOLDERS' DEFICIENCY - Standby Equity Distribution Agreement (Details) - USD ($)	Feb. 27, 2020	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Mar. 31, 2019	Jun. 30, 2020	Jun. 30, 2019	Jun. 29, 2020	Dec. 31, 2019
Common Stock, Par Value (in dollars per share)		$ 0.0001				$ 0.0001			$ 0.0001
Stock Issued						$ 141,000	$ 0
Par value per share (in dollars per share)		$ 0.0001				$ 0.0001			$ 0.0001
Common stock issued for cash				$ 743,300	$ 155,000
Accrued issuable equity for subscriptions receivable		$ 220,000				$ 220,000
Standby Equity Distribution Agreement
Value of shares authorized to be issued under the SEDA agreement	$ 8,000,000
Common Stock, Par Value (in dollars per share)	$ 0.0001
Lowest daily volume weighted average price of the Common Stock to be paid (as a percent)	80.00%
Threshold number of trading days for investor payments	5 days
Investor's obligation to purchase, per advance amount	$ 100,000
Threshold maximum investor's ownership percentage	4.99%
Commitment period	24 months
Cash paid	$ 15,000
Number of shares issued as a commitment fee for the SEDA agreement			95,847
Fair value of shares	63,259
Deferred offering costs	$ 78,259
Amortization expense		78,259				78,259
Proceeds from notes payable		$ 141,000				$ 141,000
Common stock issued for cash, net of issuance costs (in shares)		561,564				561,564
Par value per share (in dollars per share)	$ 0.0001
Common stock issued for cash		$ 757,695				$ 757,695
Accrued issuable equity for subscriptions receivable		$ 220,000				$ 220,000		$ 220,000
Series B Convertible Preferred Stock
Common stock issued for cash, net of issuance costs (in shares)				0	0
Common stock issued for cash				$ 0	$ 0
Maximum | Standby Equity Distribution Agreement
Common Stock, Par Value (in dollars per share)		$ 1.62				$ 1.62
Par value per share (in dollars per share)		1.62				1.62
Minimum | Standby Equity Distribution Agreement
Common Stock, Par Value (in dollars per share)		0.72				0.72
Par value per share (in dollars per share)		$ 0.72				$ 0.72

STOCKHOLDERS' DEFICIENCY - Stoc

STOCKHOLDERS' DEFICIENCY - Stock-Based Compensation (Details) - USD ($)	Jun. 12, 2020	Jan. 01, 2020	Jun. 30, 2020	Jun. 30, 2020	Jun. 30, 2019
STOCKHOLDERS' DEFICIENCY
Shares of common stock issued related to consulting services provided	30,000			30,000	25,000
Grant date value of common stock issued related to consulting services provided			$ 30,000	$ 30,000	$ 36,060
Options Outstanding, Number of Options		10,000
Options Outstanding, Exercise Price		$ 0.66
Share based Compensation Arrangement By Share based Payment Award Options Non vested Weighted Average Aggregate Grant Date Fair Value		$ 3,609
Expected volatility (as a percent)		93.00%
Expected term		2 years 6 months
Risk free interest rate (as a percent)		1.58%
Expected dividends (as a percent)		0.00%

STOCKHOLDERS' DEFICIENCY - St_2

STOCKHOLDERS' DEFICIENCY - Stock-Based Compensation Expense (Details) - USD ($)	Jun. 12, 2020	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense		$ 82,088	$ 45,171	$ 94,816	$ 93,111
Stock Issued During Period, Shares, Issued for Services	30,000			30,000	25,000
Unrecognized stock-based compensation expense		76,329		$ 76,329
Weighted average remaining vesting period				2 years
Grant date value debited to additional paid in capital				$ 141,000	$ 0
Selling, general and administrative expenses
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense		79,925		84,541
Research and development expenses
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense		2,163		10,275
Common Stock
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense		30,000		30,000	36,060
Stock options
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense		9,588	7,593	20,116	7,593
Accrued issuable equity (common stock)
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense		$ 42,500	$ 37,578	$ 44,700	28,971
Accrued issuable equity (warrants)
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense					$ 20,487

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Jun. 15, 2020
COMMITMENTS AND CONTINGENCIES
Monthly rental payments					$ 5,107
Base rent					4,552
Association fees					$ 555
Operating Lease, Expense	$ 17,200	$ 40,103	$ 27,216	$ 80,488
Right of use assets	0		0
Lease liabilities	$ 0		$ 0

SUBSEQUENT EVENTS (Details)

SUBSEQUENT EVENTS (Details) - USD ($)	Jul. 20, 2020	Jul. 01, 2020	Jun. 12, 2020	Jul. 31, 2020	Jun. 30, 2020	Jun. 30, 2019	Mar. 31, 2019	Jun. 30, 2020	Jun. 30, 2019	Jun. 29, 2020	Feb. 27, 2020	Dec. 31, 2019
Subsequent Event [Line Items]
Accrued issuable equity for subscriptions receivable					$ 220,000			$ 220,000
Shares of common stock issued related to consulting services provided			30,000					30,000	25,000
Grant date value of common stock issued related to consulting services provided					$ 30,000			$ 30,000	$ 36,060
Common stock issued for cash						$ 743,300	$ 155,000
Par value per share (in dollars per share)					$ 0.0001			$ 0.0001				$ 0.0001
Standby Equity Distribution Agreement
Subsequent Event [Line Items]
Accrued issuable equity for subscriptions receivable					$ 220,000			$ 220,000		$ 220,000
Common stock issued for cash, net of issuance costs (in shares)					561,564			561,564
Common stock issued for cash					$ 757,695			$ 757,695
Par value per share (in dollars per share)											$ 0.0001
Standby Equity Distribution Agreement | Minimum
Subsequent Event [Line Items]
Par value per share (in dollars per share)					$ 0.72			$ 0.72
Standby Equity Distribution Agreement | Maximum
Subsequent Event [Line Items]
Par value per share (in dollars per share)					$ 1.62			$ 1.62
Subsequent Event
Subsequent Event [Line Items]
Shares of common stock issued related to consulting services provided		35,000
Grant date value of common stock issued related to consulting services provided		$ 25,000
Subsequent Event | Standby Equity Distribution Agreement
Subsequent Event [Line Items]
Common stock issued for cash, net of issuance costs (in shares)				771,159
Common stock issued for cash				$ 745,000
Gross Proceeds From Issuance Of Common Stock				915,000
Payment of Note Payable				$ 170,000
Subsequent Event | Standby Equity Distribution Agreement | Minimum
Subsequent Event [Line Items]
Par value per share (in dollars per share)				$ 0.96
Subsequent Event | Standby Equity Distribution Agreement | Maximum
Subsequent Event [Line Items]
Par value per share (in dollars per share)				$ 1.65
Subsequent Event | Note Purchase Agreement | Promissory Note | Investor
Subsequent Event [Line Items]
Aggregate principal amount	$ 2,500,000
Commitment fee percentage	8.00%
Structuring fee	$ 10,000
Premium percentage	10.00%
Accrued issuable equity issued for subscriptions receivable				$ 200,000