Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Mar. 29, 2019 | Jun. 30, 2018 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2018 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | KULR Technology Group, Inc. | ||
Entity Central Index Key | 0001662684 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Public Float | $ 0 | ||
Entity Common Stock, Shares Outstanding | 78,966,105 | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | true |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Current Assets: | ||
Cash | $ 229,896 | $ 895,761 |
Accounts receivable | 112,224 | 151,802 |
Inventory | 9,594 | 13,767 |
Prepaid expenses | 27,033 | 106,466 |
Other current assets | 27,569 | 8,727 |
Total Current Assets | 406,316 | 1,176,523 |
Property and equipment, net | 44,791 | 43,493 |
Total Assets | 451,107 | 1,220,016 |
Current Liabilities: | ||
Accounts payable | 117,995 | 37,024 |
Accrued expenses and other current liabilities | 374,330 | 188,942 |
Accrued expenses and other current liabilities - related party | 83,919 | 254,344 |
Total Current Liabilities | 576,244 | 480,310 |
Commitments and contingencies | ||
Stockholders' (Deficiency) Equity: | ||
Common stock, $0.0001 par value, 500,000,000 shares authorized; 78,706,256 and 77,440,000 shares issued and outstanding at December 31, 2018 and 2017, respectively | 7,871 | 7,744 |
Additional paid-in capital | 6,283,548 | 5,090,282 |
Accumulated deficit | (6,416,559) | (4,358,320) |
Total Stockholders' (Deficiency) Equity | (125,137) | 739,706 |
Total Liabilities and Stockholders' (Deficiency) Equity | 451,107 | 1,220,016 |
Series A Preferred Stock [Member] | ||
Stockholders' (Deficiency) Equity: | ||
Preferred stock | 0 | 0 |
Series B Convertible Preferred Stock [Member] | ||
Stockholders' (Deficiency) Equity: | ||
Preferred stock | 3 | 0 |
Total Stockholders' (Deficiency) Equity | $ 3 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Preferred Stock, Par Value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Authorized | 20,000,000 | 20,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
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 | 78,706,256 | 77,440,000 |
Common Stock, Shares, Outstanding | 78,706,256 | 77,440,000 |
Series A Preferred Stock [Member] | ||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 |
Series B Convertible Preferred Stock [Member] | ||
Preferred Stock, Shares Authorized | 31,000 | 31,000 |
Preferred Stock, Shares Issued | 30,858 | 0 |
Preferred Stock, Shares Outstanding | 30,858 | 0 |
Preferred Stock Shares Liquidated Preference | $ 30,858 | $ 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue | $ 1,274,028 | $ 235,584 |
Cost of revenue | 336,654 | 156,609 |
Gross Profit | 937,374 | 78,975 |
Operating Expenses: | ||
Research and development | 508,144 | 361,231 |
Research and development - related parties | 0 | 439,824 |
Selling, general and administrative | 2,510,818 | 1,691,466 |
Total Operating Expenses | 3,018,962 | 2,492,521 |
Loss From Operations | (2,081,588) | (2,413,546) |
Other (Expense) Income: | ||
Interest expense, net | (826) | (10,964) |
Change in fair value of accrued issuable equity | 24,175 | 0 |
Total Other Income (Expense) | 23,349 | (10,964) |
Net Loss | $ (2,058,239) | $ (2,424,510) |
Net Loss Per Share - Basic and Diluted | $ (0.03) | $ (0.04) |
Weighted Average Number of Common Shares Outstanding - Basic and Diluted | 77,642,101 | 63,981,416 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' (DEFICIENCY) EQUITY - USD ($) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Series B Convertible Preferred Stock [Member] | |
Balance at Dec. 31, 2016 | $ (267,161) | $ 5,000 | $ 1,661,649 | $ (1,933,810) | $ 0 | |
Balance (shares) at Dec. 31, 2016 | 50,000,000 | 0 | ||||
Stock-based compensation | 598,204 | $ 0 | 598,204 | 0 | $ 0 | |
Stock-based compensation (in shares) | 0 | 0 | ||||
Equity of KULR Technology Group, Inc., at the time of the reverse recapitalization | 2,698,173 | $ 2,744 | 2,695,429 | 0 | $ 0 | |
Equity of KULR Technology Group, Inc., at the time of the reverse recapitalization (in shares) | 27,440,000 | 0 | ||||
Waiver of previously accrued executive consulting fees | 135,000 | $ 0 | 135,000 | 0 | $ 0 | |
Net loss | (2,424,510) | 0 | 0 | (2,424,510) | 0 | |
Balance at Dec. 31, 2017 | 739,706 | $ 7,744 | 5,090,282 | (4,358,320) | $ 0 | |
Balance (shares) at Dec. 31, 2017 | 77,440,000 | 0 | ||||
Stock-based compensation | 440,138 | $ 19 | 440,119 | 0 | $ 0 | |
Stock-based compensation (in shares) | 184,437 | 0 | ||||
Common stock issued for cash, net of issuance costs | [1] | 672,400 | $ 108 | 672,292 | 0 | $ 0 |
Common stock issued for cash, net of issuance costs (in shares) | [1] | 1,081,819 | 0 | |||
Series B Convertible Preferred Stock issued to common stockholders (See Note 9) | 1,018,314 | $ 0 | 1,018,311 | 0 | $ 3 | |
Series B Convertible Preferred Stock issued to common stockholders (See Note 9) (in shares) | 0 | 30,858 | ||||
Series B Convertible Preferred Stock issued as deemed dividend to common stockholders (See Note 9 ) | (987,456) | $ 0 | (987,456) | 0 | $ 0 | |
Forgiveness of accrued expenses by related party | 50,000 | 0 | 50,000 | 0 | 0 | |
Net loss | (2,058,239) | 0 | 0 | (2,058,239) | ||
Balance at Dec. 31, 2018 | $ (125,137) | $ 7,871 | $ 6,283,548 | $ (6,416,559) | $ 3 | |
Balance (shares) at Dec. 31, 2018 | 78,706,256 | 30,858 | ||||
[1] | Includes gross proceeds of $714,000, less issuance costs of $41,600 ($35,000 of cash and $6,600 of non-cash). |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' (DEFICIENCY) EQUITY (Parenthetical) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Proceeds From Issuance Of Private Placement Gross | $ 714,000 |
Stock Issued | 6,600 |
Common Stock [Member] | |
Payments of Stock Issuance Costs | 41,600 |
Common Stock [Member] | Cash [Member] | |
Payments of Stock Issuance Costs | $ 35,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Cash Flows From Operating Activities: | |||
Net loss | $ (2,058,239) | $ (2,424,510) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation expense | 15,311 | 8,797 | |
Change in fair value of accrued issuable equity | (24,175) | 0 | |
Stock-based compensation | 457,713 | 598,204 | |
Lower of cost or net realizable value adjustment | 4,173 | 0 | |
Changes in operating assets and liabilities: | |||
Accounts receivable | 39,578 | (144,902) | |
Other current receivable | 0 | 30,000 | |
Other current receivable - related parties | 0 | 2,000 | |
Interest receivable - related party | 0 | 2,152 | |
Inventory | 0 | (835) | |
Prepaid expenses | 79,433 | (80,968) | |
Other current assets | (10,692) | 861,377 | |
Accounts payable | 80,971 | 0 | |
Accrued expenses and other current liabilities | 185,388 | 140,323 | |
Accrued expenses and other current liabilities - related party | (120,425) | 2,603 | |
Security deposit | (8,150) | 0 | |
Total Adjustments | 699,125 | 1,418,751 | |
Net Cash Used In Operating Activities | (1,359,114) | (1,005,759) | |
Cash Flows From Investing Activities: | |||
Proceeds from loan from related party | 0 | 85,000 | |
Cash acquired in reverse recapitalization | 0 | 1,859,261 | |
Purchases of property and equipment | (16,609) | (51,828) | |
Net Cash (Used In) Provided By Investing Activities | (16,609) | 1,892,433 | |
Cash Flows from Financing Activities: | |||
Proceeds from sale of common stock | [1] | 679,000 | 0 |
Proceeds from issuance of Series B Convertible Preferred Stock | 30,858 | 0 | |
Net Cash Provided By Financing Activities | 709,858 | 0 | |
Net (Decrease) Increase In Cash | (665,865) | 886,674 | |
Cash - Beginning of Period | 895,761 | 9,087 | |
Cash - End of Period | 229,896 | 895,761 | |
Supplemental Disclosures of Cash Flow Information: | |||
Interest | 888 | 2,962 | |
Income taxes | 2,400 | 2,400 | |
Non-cash investing and financing activities: | |||
Common stock equity offering issuance costs | 6,600 | 0 | |
Series B convertible preferred stock issued as deemed dividend to common stockholders | 987,456 | 0 | |
Forgiveness of accrued expenses by related party | $ 50,000 | $ 135,000 | |
[1] | Includes gross proceeds of $714,000, less issuance costs of $35,000. |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Proceeds From Issuance Of Private Placement Gross | $ 714,000 |
Common Stock [Member] | |
Payments of Stock Issuance Costs | 41,600 |
Common Stock [Member] | Cash [Member] | |
Payments of Stock Issuance Costs | $ 35,000 |
BUSINESS ORGANIZATION AND NATUR
BUSINESS ORGANIZATION AND NATURE OF OPERATIONS | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | NOTE 1 BUSINESS ORGANIZATION AND NATURE OF OPERATIONS Organization and Operations KULR Technology Group, Inc. was incorporated on December 11, 2015 under the laws of the State of Delaware as KT High-Tech Marketing, Inc. Effective August 30, 2018, KT High-Tech Marketing, Inc. changed its name to KULR Technology Group, Inc. KULR Technology Group, Inc. ("KUTG"), through its wholly-owned subsidiary, KULR Technology Corporation (“KTC”) (collectively referred to as “KULR” or the “Company”), develops and commercializes high-performance thermal management technologies for electronics, batteries, and other components across an array 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's proprietary, core technology is a carbon fiber material, with roots in aerospace and defense. Reverse Recapitalization On June 8, 2017, KUTG entered into a Share Exchange Agreement (the “Share Exchange Agreement”) with KTC and 100% of the shareholders of KTC (the “KTC Shareholders”). On June 19, 2017 (the “Closing Date”), the Company closed the transaction contemplated by the Share Exchange Agreement. Pursuant to the Share Exchange Agreement, the KTC Shareholders agreed to transfer an aggregate of 25,000,000 shares of KTC’s common stock to the Company in exchange for the Company’s issuance of an aggregate of 50,000,000 shares of the Company’s common stock to the KTC Shareholders (the “Share Exchange”). On the Closing Date, KTC became a wholly-owned subsidiary of KUTG, the KTC Stockholders beneficially owned approximately 64.57% of KUTG’s common stock on a fully-diluted basis, KUTG began operating KTC’s business of developing and commercializing its thermal management technologies and a representative of the KTC Stockholders was appointed to be the Company’s second Board Director. The closing of the Share Exchange Agreement was accounted for as a reverse recapitalization under the provisions of the Financial Accounting Standards Board ("FASB") Accounting Standards Codification (“ASC”) Topic 805-40. The consolidated statements of operations herein reflect the historical results of KTC prior to the completion of the reverse recapitalization since it was determined to be the accounting acquirer, and do not include the historical results of operations for KUTG prior to the completion of the reverse recapitalization. KUTG’s assets and liabilities were consolidated with the assets and liabilities of KTC as of the Closing Date. The number of shares issued and outstanding and additional paid-in capital of KUTG have been retroactively adjusted to reflect the equivalent number of shares issued by KUTG in the Share Exchange, while KTC’s accumulated deficit is being carried forward as the Company’s accumulated deficit. All costs attributable to the reverse recapitalization were expensed. |
GOING CONCERN AND MANAGEMENT'S
GOING CONCERN AND MANAGEMENT'S PLANS | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Substantial Doubt about Going Concern [Text Block] | 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. 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 product revenues to achieve profitability. These 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 Company is currently funding its operations on a month-to-month basis by means of private placements. Although the Company’s management believes that it has access to capital resources, there are currently no commitments in place for new financing at this time and there is no assurance that the Company will be able to obtain 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 accompanying 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 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 | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | NOTE 3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The consolidated financial statements of the Company include the accounts of KUTG and its wholly-owned subsidiary, KTC. All significant intercompany transactions have been eliminated in the consolidation. Use of Estimates Preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, together with amounts disclosed in the related notes to the financial statements. The Company’s significant estimates used in these financial statements include, but are not limited to, fair value calculations for equity securities, stock-based compensation, the collectability of receivables, inventory valuations, the recoverability and useful lives of long-lived assets, and the valuation allowance related to the Company’s deferred tax assets. Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company’s estimates and could cause actual results to differ from those estimates. See Note 3 - Summary of Significant Accounting Policies — Stock-Based Compensation for additional discussion of the use of estimates in estimating the fair value of the Company’s common stock. Concentrations of Credit Risk The Company maintains cash with major financial institutions. Cash held in U.S. bank institutions is currently insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 at each institution. There were aggregate uninsured cash balances of $0 and $611,450 at December 31, 2018 and 2017, respectively. Customer concentrations are as follows: Revenues Accounts Receivable For the Years Ended December 31, As of December 31, 2018 2017 2018 2017 Customer A 66 % 49 % 63 % 43 % Customer B 13 % * * * Customer C * 14 % * 24 % Customer D * * 37 % * Customer E * * * 15 % Total 79 % 63 % 100 % 82 % * Less than 10% Accounts Receivable Accounts receivable are carried at their contractual amounts, less an estimate for uncollectible amounts. As of December 31, 2018 and 2017, there were no allowances for uncollectable amounts determined to be necessary. Management estimates the allowance for bad debts based on existing economic conditions, the financial conditions of the customers, and the amount and age of past due accounts. Receivables are considered past due if full payment is not received by the contractual due date. Past due accounts are generally written off against the allowance for bad debts only after all collection attempts have been exhausted. Inventory Inventory is comprised of carbon fiber thermal interface solutions, which are available for sale. Inventories are stated at the lower of cost and net realizable value. Cost is determined by the first-in, first-out method. Inventory that is sold to third parties is included within cost of sales and inventory that is given as samples is included within operating expenses. The Company periodically reviews for slow-moving, excess or obsolete inventories. Products that are determined to be obsolete, if any, are written down to net realizable value. As of December 31, 2018 and 2017, the Company’s inventory was comprised solely of finished goods. Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation which is recorded commencing at the in-service date using the straight-line method at rates sufficient to charge the cost of depreciable assets to operations over their estimated useful lives, which range from 3 to 7 years. Leasehold improvements are amortized over the lesser of (a) the useful life of the asset; or (b) the remaining lease term. Maintenance and repairs are charged to operations as incurred. The Company capitalizes cost attributable to the betterment of property and equipment when such betterment extends the useful life of the assets. The Company reviews for the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss would be recognized when the present value of estimated future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying value. Fair Value of Financial Instruments The Company measures the fair value of financial assets and liabilities based on the guidance of ASC 820 “Fair Value Measurements and Disclosures” (“ASC 820”) which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value: Level 1 — quoted prices in active markets for identical assets or liabilities Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable Level 3 — inputs that are unobservable (for example, cash flow modeling inputs based on assumptions) The carrying amounts of the Company’s financial instruments, such as cash, accounts receivable and accrued expenses and other current liabilities approximate fair values due to the short-term nature of these instruments. Preferred Stock The Company applies the accounting standards for distinguishing liabilities from equity when determining the classification and measurement of its preferred stock. Preferred shares subject to mandatory redemption are classified as liability instruments and are measured at fair value. Conditionally redeemable preferred shares (including preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, preferred shares are classified as stockholders’ equity. During the year ended December 31, 2018, the Company obtained a third-party 409A valuation of its Series B Convertible Preferred Stock, which was considered in management’s estimation of the value of the equity instruments issued during that period. Under the 409A valuation, it was determined the Company’s Series B Convertible Preferred Stock had a fair value of $33.00 per share. Convertible Instruments The Company evaluates its convertible instruments to determine if those contracts or embedded components of those contracts qualify as derivative financial instruments to be separately accounted for in accordance with Topic 815 of the FASB ASC. The accounting treatment of derivative financial instruments requires that the Company record embedded conversion options and any related freestanding instruments at their fair values as of the inception date of the agreement and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, non-cash income or expense for each reporting period at each balance sheet date. The Company reassesses the classification of its derivative instruments at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. Embedded conversion options and any related freestanding instruments are recorded as a discount to the host instrument. If the instrument is determined to be a derivative liability, the Company then evaluates for the existence of a beneficial conversion feature by comparing the market price of the Company’s common stock as of the commitment date to the effective conversion price of the instrument. Offering Costs Deferred offering costs, which primarily consist of direct, incremental professional fees incurred in connection with a debt or equity financing, are capitalized as non-current assets on the balance sheet. Once the financing closes, the Company reclassifies such costs as either discounts to notes payable or as a reduction of proceeds received from equity transactions so that such costs are recorded as a reduction of additional paid-in capital. If the completion of a contemplated financing was deemed to be no longer probable, the related deferred offering costs would be charged to general and administrative expense in the consolidated financial statements. Revenue Recognition On January 1, 2018, the Company adopted 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 than required under existing U.S. GAAP 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 adopted ASC 606 for all applicable contracts using the modified retrospective method, which would have required a cumulative-effect adjustment, if any, as of the date of adoption. The adoption of ASC 606 did not have a material impact on the Company's consolidated financial statements as of the date of adoption. As a result, a cumulative-effect adjustment was not required. The Company recognizes revenue primarily from the following different types of contracts: Product sales – Revenue is recognized at the point the customer obtains controls 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 contract services to the customer. The following table summarizes our revenue recognized in our consolidated statements of operations: For the Years Ended December 31, 2018 2017 Product sales $ 1,096,040 $ 215,271 Contract services 177,988 20,313 Total revenue $ 1,274,028 $ 235,584 As of December 31, 2018 and 2017, the Company did not have any contract assets and contract liabilities 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 years ended December 31, 2018, and 2017, $0 of revenue was recognized from performance obligations satisfied (or partially satisfied) in previous periods. Reclassifications Certain prior year financial statement amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations. Shipping and Handling Costs Shipping and handling costs incurred by the Company as well as fees received by customers for product shipped to customers are included in selling, general and administrative expenses on the consolidated statements of operations. For the years ended December 31, 2018 and 2017, shipping and handling costs amounted to $932 and $0, respectively. Research and Development Research and development expenses are charged to operations as incurred. During the years ended December 31, 2018 and 2017, the Company incurred $508,144 and $801,055, respectively, of research and development expenses. Advertising Costs Advertising costs are expensed in the period incurred. Advertising costs charged to operations for the years ended December 31, 2018 and 2017 were $12,500 and $65,085, respectively, and are included in selling, general and administrative on the consolidated statements of operations. Stock-Based Compensation The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award. The fair value of the award is measured on the grant date. The fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. Upon the exercise of an award, the Company issues new shares of common stock out of its authorized shares. During the year ended December 31, 2018, the Company obtained a third-party 409A valuation of its common stock, which was also considered in management’s estimation of the value of the equity instruments issued during that period. Under the 409A valuation, it was determined the Company’s common stock had a fair value of $0.66 per 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 and dilutive common-equivalent shares outstanding during each period. Dilutive common-equivalent shares consist of shares of non-vested restricted stock, if not anti-dilutive. The following shares were excluded from the calculation of weighted average dilutive common shares because their inclusion would have been anti-dilutive: Decemeber 31, 2018 2017 Non-vested restricted stock - 312,500 Series B Convertible Preferred Stock 1,542,850 - Total 1,542,850 312,500 Income Taxes The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of items that have been included or excluded in the financial statements or tax returns. Deferred tax assets and liabilities are determined on the basis of the difference between the tax basis of assets and liabilities and their respective financial reporting amounts (“temporary differences”) at enacted tax rates in effect for the years in which the temporary differences are expected to reverse. The Company utilizes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Management has evaluated and concluded that there were no material uncertain tax positions requiring recognition in the Company’s financial statements as of December 31, 2018 and 2017. The Company does not expect any significant changes in its unrecognized tax benefits within twelve months of the reporting date. The Company’s policy is to classify assessments, if any, for tax related interest as interest expense and penalties as selling, general and administrative expenses in the consolidated statements of operations. Subsequent Events The Company has evaluated subsequent events through the date which the consolidated financial statements were issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the consolidated financial statements, except as disclosed. Recent Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02, "Leases (Topic 842)." ASU 2016-02 requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. This amendment will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The FASB issued ASU No. 2018-10 “Codification Improvements to Topic 842, Leases” and ASU No. 2018-11 “Leases (Topic 842) Targeted Improvements" in July 2018, and ASU No. 2018-20 "Leases (Topic 842) - Narrow Scope Improvements for Lessors" in December 2018. ASU 2018-10 and ASU 2018-20 provide certain amendments that affect narrow aspects of the guidance issued in ASU 2016-02. ASU 2018-11 allows all entities adopting ASU 2016-02 to choose an additional (and optional) transition method of adoption, under which an entity initially applies the new leases standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company adopted ASU 2016-02 effective January 1, 2019 In May 2017, the FASB issued ASU No. 2017-09, “Compensation — Stock Compensation (Topic 718): Scope of Modification Accounting,” (“ASU 2017-09”). ASU 2017-09 provides clarity on the accounting for modifications of stock-based awards. ASU 2017-09 requires adoption on a prospective basis in the annual and interim periods for fiscal years beginning after December 15, 2017 for share-based payment awards modified on or after the adoption date. The Company adopted ASU 2017-09 effective January 1, 2018 and its adoption did not have a material impact on the Company’s consolidated financial statements. In July 2017, the FASB issued ASU No. 2017-11, “Earnings Per Share (Topic 260) and Derivatives and Hedging (Topic 815) — Accounting for Certain Financial Instruments with Down Round Features,” (“ASU 2017-11”). Equity-linked instruments, such as warrants and convertible instruments may contain down round features that result in the strike price being reduced on the basis of the pricing of future equity offerings. Under ASU 2017-11, a down round feature will no longer require a freestanding equity-linked instrument (or embedded conversion option) to be classified as a liability that is remeasured at fair value through the income statement (i.e. marked-to-market). However, other features of the equity-linked instrument (or embedded conversion option) must still be evaluated to determine whether liability or equity classification is appropriate. Equity classified instruments are not marked-to-market. For earnings per share (“EPS”) reporting, the ASU requires companies to recognize the effect of the down round feature only when it is triggered by treating it as a dividend and as a reduction of income available to common shareholders in basic EPS. The amendments in this ASU are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted, including adoption in any interim period. The In June 2018, the FASB issued ASU No. 2018-07, “Compensation — Stock Compensation (Topic 718),” (“ASU 2018-07”). ASU 2018-07 is intended to reduce cost and complexity and to improve financial reporting for nonemployee share-based payments. Currently, the accounting requirements for nonemployee and employee share-based payment transactions are significantly different. ASU 2018-07 expands the scope of Topic 718, Compensation — Stock Compensation (which currently only includes share-based payments to employees) to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. This ASU supersedes Subtopic 505-50, Equity — Equity-Based Payments to Nonemployees. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018, and interim periods within that fiscal year. Early adoption is permitted, but no earlier than a company’s adoption date of Topic 606, Revenue from Contracts with Customers. The Company early adopted ASU 2018-07 effective April 1, 2018. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements. In July 2018, the FASB issued ASU No. 2018-09, “Codification Improvements” (“ASU 2018-09”). These amendments provide clarifications and corrections to certain ASC subtopics including the following: Income Statement - Reporting Comprehensive Income – Overall (Topic 220-10), Debt - Modifications and Extinguishments (Topic 470-50), Distinguishing Liabilities from Equity – Overall (Topic 480-10), Compensation - Stock Compensation - Income Taxes (Topic 718-740), Business Combinations - Income Taxes (Topic 805-740), Derivatives and Hedging – Overall (Topic 815-10), and Fair Value Measurement – Overall (Topic 820-10). The majority of the amendments in ASU 2018-09 will be effective in annual periods beginning after December 15, 2018. The Company expects to adopt ASU 2018-09 effective January 1, 2019 and its adoption is not expected to have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). The amendments in ASU 2018-13 modify the disclosure requirements on fair value measurements based on the concepts in the Concepts Statement, including the consideration of costs and benefits. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. The amendments are effective for all entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements. In November 2018, the FASB issued ASU No. 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606 (“ASU 2018-18”), which clarifies that certain transactions between participants in a collaborative arrangement should be accounted for under ASC 606 when the counterparty is a customer. In addition, ASU 2018-18 precludes an entity from presenting consideration from a transaction in a collaborative arrangement as revenue from contracts with customers if the counterparty is not a customer for that transaction. For public business entities, the amendments in this update are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021. Early adoption is permitted, including adoption in any interim period, (1) for public business entities for periods for which financial statements have not yet been issued and (2) for all other entities for periods for which financial statements have not yet been made available for issuance. An entity may not adopt the amendments earlier than its adoption date of Topic 606. The amendments in this Update should be applied retrospectively to the date of initial application of Topic 606. An entity should recognize the cumulative effect of initially applying the amendments as an adjustment to the opening balance of retained earnings of the later of the earliest annual period presented and the annual period that includes the date of the entity’s initial application of Topic 606. An entity may elect to apply the amendments in this Update retrospectively either to all contracts or only to contracts that are not completed at the date of initial application of Topic 606. An entity should disclose its election. An entity may elect to apply the practical expedient for contract modifications that is permitted for entities using the modified retrospective transition method in Topic 606. The Company is currently evaluating the effect that adopting this new accounting guidance will have on its consolidated financial statements and related disclosures. |
PREPAID EXPENSES
PREPAID EXPENSES | 12 Months Ended |
Dec. 31, 2018 | |
Prepaid Expense, Current [Abstract] | |
Prepaid Expenses Disclosure [Text Block] | NOTE 4 PREPAID EXPENSES As of December 31, 2018 and 2017, prepaid expenses consisted of the following: Decemeber 31, 2018 2017 Business development services $ - $ 40,000 Research and development services 7,500 25,000 Professional fees 94 10,000 Filing fees 8,750 - Insurance 8,177 - Other 2,512 31,466 Total prepaid expenses $ 27,033 $ 106,466 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Disclosure [Text Block] | NOTE 5 PROPERTY AND EQUIPMENT As of December 31, 2018 and 2017, property and equipment consisted of the following: December 31, 2018 2017 Computer equipment $ 13,356 $ 8,402 Leasehold improvement 8,834 8,834 Software 5,656 5,656 Machinery and equipment 26,304 17,954 Research and development equipment 12,810 12,811 Furniture and fixtures 3,306 - 70,266 53,657 Less: accumulated deprecation (25,475 ) (10,164 ) Property and equipment, net $ 44,791 $ 43,493 Depreciation expense amounted to $15,311 and $8,797 for the years ended December 31, 2018 and 2017, respectively, which is included in selling, general and administrative expenses in the consolidated statements of operations. |
ACCRUED EXPENSES AND OTHER CURR
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 12 Months Ended |
Dec. 31, 2018 | |
Accounts Payable and Accrued Liabilities, Current [Abstract] | |
Accounts Payable, Accrued Liabilities, and Other Liabilities Disclosure, Current [Text Block] | NOTE 6 ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES As of December 31, 2018 and 2017, accrued expenses and other current liabilities consisted of the following: December 31, 2018 2017 Accrued payroll and vacation $ 252,043 $ 69,847 Accrued legal and professional fees 47,502 67,933 Accrued travel expenses 48,248 28,254 Payroll and income tax payable 12,678 14,223 Accrued research and development expenses 2,850 - Credit card payable 4,586 110 Accrued issuable equity 3,960 1,104 Accrued rent 176 - Other 2,287 7,471 Total accrued expenses and other current liabilities $ 374,330 $ 188,942 Accrued issuable equity as of December 31, 2018 consists of 6,000 shares of common stock that had not been issued that had a fair value of $3,960. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | NOTE 7 RELATED PARTY TRANSACTIONS See Note 9 – Stockholders’ Equity – Common Stock Accrued Expenses and Other Current Liabilities On December 20, 2018, Energy Science Laboratories, Inc. (“ESLI”), a company controlled by the Company’s Chief Technology Office (“CTO”), forgave $50,000 of previously accrued consulting fees that were due to them by the Company. As a result, the Company accounted for the forgiveness as a capital contribution by reducing accrued expenses and other current liabilities by $50,000 with a corresponding credit to stockholders’ equity. Accrued expenses and other current liabilities – related party consists of a liability of $83,919 and $254,344 as of December 31, 2018 and 2017, respectively, to ESLI in connection with consulting services provided by ESLI to the Company associated with the development of the Company’s CFV thermal management solutions. Note Receivable On June 13, 2017, the Company collected a $85,000 note receivable from its Chief Executive Officer (“CEO”) in full as well as outstanding accrued interest in the amount of $3,488. The note receivable was related to a loan made prior to the Share Exchange. For the years ended December 31, 2018 and 2017, respectively, the Company recorded $0 and $1,336, respectively, of interest income in connection with the note receivable. Consulting Agreements On June 2, 2014, KULR entered into consulting agreements with its CEO and CTO. The agreements provide for a monthly retainer of $6,250 for June 2014 through November 2014 and $6,500 thereafter. The term of each agreement is twelve months and provide for automatic extensions, in the absence of termination. The consulting agreements were terminated in connection with the closing of the Share Exchange. During the years ended December 31, 2018 and 2017, the Company recorded aggregate expense of $0 and $57,000, respectively, related to the consulting agreements. On November 11, 2017, the Company’s CEO and CTO waived $25,000 and $110,000, respectively, related to compensation previously owed to them by the Company in connection with their respective consulting agreements with KTC discussed above. As a result, the Company accounted for the waiver by reducing accrued expenses and other current liabilities by $135,000 with a corresponding credit to stockholders’ equity. During the years ended December 31, 2018 and 2017, the Company recorded research and development expense of $0 and $407,324, respectively, related to consulting services provided to the Company by ESLI associated with the development of the Company’s CFV thermal management solutions. ESLI is controlled by the Company’s CTO. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | NOTE 8 INCOME TAXES The income tax provision for the years ended December 31, 2018 and 2017 consists of the following: For The Years Ended December 31, 2018 2017 Federal: Current $ - $ - Deferred (347,767 ) (393,945 ) State and local: Current - - Deferred (121,933 ) (175,455 ) (469,700 ) (569,400 ) Change in valuation allowance 469,700 569,400 Income tax provision $ - $ - A reconciliation of the statutory federal income tax rate to the Company’s effective tax rate is as follows: For The Years Ended December 31, 2018 2017 Tax benefit at federal statutory rate (21.0 )% (34.0 )% State income taxes, net of federal benefit (6.0 )% (6.0 )% Permanent differences 0.2 % 0.4 % Incremental research and development tax credits 0.0 % (2.9 )% Prior year true-ups 4.0 % 0.0 % Change in valuation allowance 22.8 % 20.8 % Change in federal tax rate 0.0 % 21.7 % Effective income tax rate (0.0 )% 0.0 % The Company has determined that a valuation allowance for the entire net deferred tax asset is required. A valuation allowance is required if, based on the weight of evidence, it is more likely than not that some or the entire portion of the deferred tax asset will not be realized. After consideration of all the evidence, management has determined that a full valuation allowance is necessary to reduce the deferred tax asset to zero. The tax effects of temporary differences that give rise to deferred tax assets and liabilities are presented below: For The Years Ended December 31, 2018 2017 Deferred Tax Assets: Net operating loss carryforwards $ 1,544,300 $ 1,062,400 Research and development credit carryforwards - 79,000 Stock-based compensation 187,200 184,400 Accruals 64,000 - Gross deferred tax assets 1,795,500 1,325,800 Valuation allowance (1,795,500 ) (1,325,800 ) Deferred tax asset, net of valuation allowance $ - $ - Changes in valuation allowance $ 469,700 $ 569,400 At December 31, 2018 and 2017, the Company had net operating loss carry forwards for federal and state income tax purposes of approximately $5.7 million and $3.9 The net operating loss carryovers may be subject to annual limitations under Internal Revenue Code Section 382, and similar state provisions, should there be a greater than 50% ownership change as determined under the applicable income tax regulations. The amount of the limitation would be determined based on the value of the company immediately prior to the ownership change and subsequent ownership changes could further impact the amount of the annual limitation. An ownership change pursuant to Section 382 may have occurred in the past or could happen in the future, such that the NOLs available for utilization could be significantly limited. The Tax Cuts and Jobs Act (the "Act") was enacted in December 2017. Among other things, the primary provision of Tax Reform impacting the Company is the reduction to the U.S. corporate income tax rate from 35% to 21%, eliminating certain deductions and imposing a mandatory one-time transition tax on accumulated earnings of foreign subsidiaries. The change in tax law required the Company to remeasure existing net deferred tax assets using the lower rate in the period of enactment resulting in an income tax expense of approximately $0.6 million which is fully offset by a corresponding tax benefit of $0.6 million which related to the corresponding reduction in the valuation allowance for the year ended December 31, 2017. There were no specific impacts of Tax Reform that could not be reasonably estimated which the Company accounted for under prior tax law. |
STOCKHOLDERS' (DEFICIENCY) EQUI
STOCKHOLDERS' (DEFICIENCY) EQUITY | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | NOTE 9 STOCKHOLDERS' (DEFICIENCY) EQUITY Reverse Recapitalization See Note 1 - Business Organization and Nature of Operations - Reverse Recapitalization for details of the Share Exchange. Authorized Capital The Company is authorized to issue 500,000,000 shares of common stock, par value of $0.0001 per share, and 20,000,000 shares of preferred stock, par value of $0.0001 per share. The holders of the Company’s common stock are entitled to one vote per share. The preferred stock is designated as follows: 1,000,000 shares designated as Series A Preferred Stock and 31,000 shares designated as Series B Convertible Preferred Stock. On December 31, 2018, the Company filed a certificate of amendment (the “Certificate of Amendment”) to its Certificate of Incorporation, with the Secretary of State of the State of Delaware, to effectuate an increase to the number of authorized shares of common stock of the Company. Pursuant to the Certificate of Amendment, the Company increased the number of authorized shares of its common stock, par value $0.0001, to 500,000,000 from 100,000,000 (the “Authorized Increase”). On November 21, 2018, the Company’s board of directors authorized the Company to effectuate the Authorized Increase, which Authorized Increase was approved by the written consent of the majority shareholders of the Company as of November 5, 2018. Equity Incentive Plan On August 15 and November 5, 2018, the Board of Directors and a majority of the Company’s shareholders, respectively, approved the 2018 Equity Incentive Plan (the “2018 Plan”). Under the 2018 Plan, 15,000,000 shares of common stock of the Company are authorized for issuance. The 2018 Plan provides for the issuance of incentive stock options, non-statutory stock options, rights to purchase common stock, stock appreciation rights, restricted stock and restricted stock units to employees, directors and consultants of the Company and its affiliates. The 2018 Plan requires the exercise price of stock options to be not less than the fair value of the Company’s common stock on the date of grant. Series A Preferred Stock The Series A Preferred Stock are not convertible into any series or class of stock of the Company. In addition, holders of the Series A Preferred Stock shall not be entitled to receive dividends, nor shall them have right to distribution from the assets of the Company in the event of any liquidation, dissolution, or winding up of the Company. Each record holder of Series A Preferred Stock shall have the right to vote on any matter with holders of the Company’s common stock and other securities entitled to vote, if any, voting together as one (1) class. Each record holder of Series A Preferred Stock has that number of votes equal to one-hundred (100) votes per share of Series A Preferred Stock held by such holder. On November 5, 2018, the Company received a written consent of the majority of the stockholders to issue 1,000,000 shares of the Company’s Series A Preferred Stock to Mr. Mo, as a measure to protect the Company from an uninvited takeover. As of the date of filing, the shares of Series A Preferred Stock have not been issued. Series B Convertible Preferred Stock On November 30, 2018, the Company filed with the Secretary of State of the State of Delaware the Certificate of Designation of Series B Convertible Preferred Stock (the “Certificate of Designation”), which became effective upon filing. The Company designated 31,000 shares as Series B Convertible Preferred Stock out of the authorized and unissued preferred stock of the Company, par value $0.0001 per share. Series B Convertible Preferred Stock is senior in liquidation preference to common stock. Holders of shares of Series B Convertible Preferred Stock are not entitled to voting rights and dividend rights. Each share of Series B Convertible Preferred Stock, after 181 days after issuance and without the payment of additional consideration, shall be convertible at the option of the holder into fifty (50) fully paid and non-assessable shares of common stock. Each share of Series B Convertible Preferred Stock shall have a stated value of $1.00 per share. On November 30, 2018, the Company issued an aggregate of 30,858 shares of Series B Convertible Preferred Stock to certain existing common shareholders for aggregate proceeds of $30,858, which was determined to be nominal consideration. The Company $1,018,314, which was reduced by the consideration paid of $30,858, to arrive at the deemed dividend of $987,456. The Company recognized the deemed dividend by debiting and crediting additional paid-in capital. Common Stock During the year ended December 31, 2017, the Company received aggregate consideration of $32,000 related to certain restricted common stock awards that were issued in 2013 and 2014, $2,000 of which was related to related parties. During the year ended December 31, 2018, the Company sold an aggregate of 1,081,819 shares of common stock at $0.66 per share to accredited investors for aggregate gross and net proceeds of $714,000 and $672,400, respectively. Of the $41,600 of issuance costs, $35,000 were cash costs and $6,600 were non-cash costs in the form of 10,000 shares of common stock that was issued during 2018. A summary of restricted stock award activity during the year ended December 31, 2018 is presented below: Weighted Average Grant Date Total Number of Fair Value Grant Date Shares Per Share Fair Value Non-vested, December 31, 2017 312,500 $ 0.99 $ 309,375 Granted - - - Vested (312,500 ) (0.99 ) (309,375 ) Forfeited - - - Non-vested, December 31, 2018 - $ - $ - Stock Options On December 28, 2018, the Company granted five-year options to purchase a total of 300,000 shares of common stock at an exercise price of $0.66 per share to employees pursuant to the 2018 Plan. The options vested one-fifth on the date of grant and the remaining options vest monthly over three years. The options had an aggregate grant date value of $113,312 which is recognized over the vesting period. In applying the Black-Scholes option pricing model, the Company used the following assumptions: For the Years Ended Decemeber 31, 2018 2017 Risk free interest rate 2.50 % N/A Expected term (years) 3.09 N/A Expected volatility 87.00 % N/A Expected dividends 0.00 % N/A Estimated fair value of common stock $ 0.66 N/A The Company has computed the fair value of stock options granted using the Black-Scholes option pricing model. Option forfeitures are accounted for at the time of occurrence. The expected term used is the estimated period of time that options granted are expected to be outstanding. The Company utilizes the “simplified” method to develop an estimate of the expected term of “plain vanilla” employee option grants. The Company does not yet have a trading history to support its historical volatility calculations. Accordingly, the Company is utilizing an expected volatility figure based on a review of the historical volatility of comparable entities over a period of time equivalent to the expected life of the instrument being valued. The risk-free interest rate was determined from the implied yields from U.S. Treasury zero-coupon bonds with a remaining term consistent with the expected term of the instrument being valued. The weighted average grant date fair value of options granted during the years ended December 31, 2018 was $0.18 per share. There were no options granted during 2017. A summary of options activity during the year ended December 31, 2018 is presented below: Weighted Weighted Average Average Number of Exercise Remaining Intrinsic Options Price Term (Yrs) Value Outstanding, December 31, 2017 - $ - Granted 300,000 0.66 Exercised - - Expired - - Forfeited - - Outstanding, December 31, 2018 300,000 $ 0.66 5.0 $ - Exercisable, December 31, 2018 60,000 $ 0.66 5.0 $ - The following table presents information related to stock options as of December 31, 2018: Options Outstanding Options Exercisable Outstanding Weighted Average Exercisable Exercise Number of Remaining Life Number of Price Options In Years Options $ 0.66 300,000 5.0 60,000 300,000 5.0 60,000 Stock-Based Compensation During the years ended December 31, 2018 and 2017, the Company recognized stock-based compensation expense of $457,713 (which includes the issuance of 174,437 shares of immediately vested common stock for legal and consulting fees) and $598,204, respectively, related to restricted common stock and stock options which is included within selling, general and administrative expenses on the consolidated statements of operations. As of December 31, 2018, there was $90,649 of unrecognized stock-based compensation expense that will be recognized over the weighted average remaining vesting period of 3.0 years. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | NOTE 10 COMMITMENTS AND CONTINGENCIES Operating Lease On January 1, 2017, KUTG entered into a one-year lease agreement to lease 5,296 square feet of space located in San Diego, California with respect to its research and development activities. The base rent was $4,364 per month plus association fees of $531 per month. In connection with the lease, the Company paid the landlord a security deposit of $8,729. The aggregate base rent payable over the lease term was recognized on a straight-line basis. On December 30, 2017, the rent was increased to $4,452 per month plus association fees of $531 per month. On December 30, 2018, the lease was extended until December 31, 2019, the base rent was $4,452 per month plus association fees of $555 per month. On March 8, 2018, KTC took over ESLI’s lease agreement and entered into a one-year lease agreement to lease 6,754 square feet of space located in San Diego, California with respect to its research and development activities starting May 1, 2018. The base rent was $8,150 per month. In connection with the lease, the Company recorded a liability to ESLI in connection with the security deposit of $8,150. The aggregate base rent payable over the lease term was recognized on a straight-line basis. Patent License Agreement On March 21, 2018, the Company entered into an agreement with the National Renewable Energy Laboratory (“NREL”) granting the Company an exclusive license to commercialize its patented Internal Short Circuit technology. The agreement shall be effective for as long as the licensed patents are enforceable, subject to certain early termination provisions specified in the agreement. In consideration, the Company agreed to pay to NREL the following: (i) a cash payment of $12,000 payable over one year, (ii) royalties ranging from 1.5% to 3.75% on the net sales price of the licensed products, as defined in the agreement, with minimum annual royalty payments ranging from $0 to $7,500. In addition, the Company shall use commercially reasonable efforts to bring the licensed products to market through a commercialization program that requires that certain milestones be met, as specified in the agreement. As of the date of filing, there had been no sales of the licensed products, such that no royalties had been earned. Sales Taxes States impose sales tax on certain sales to nonexempt customers. The Company believes it is currently exempt from collecting and remitting sales tax as a result of the following: (i) the products are shipped to states with sales tax exemptions, (ii) the Company’s customers are a reseller of the products that the Company sells or (iii) the Company’s customers are government agencies. The Company did not collect sales taxes during the years ended December 31, 2018 and 2017. If, during an inspection by a tax authority, the Company was unable to support its customers’ tax exemption status, the Company may be subject to a liability for sales taxes not collected. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | NOTE 11 SUBSEQUENT EVENTS Common Stock Subsequent to December 31, 2018, the Company issued 25,000 shares of common stock for legal services. Subsequent to December 31, 2018, the Company issued 234,849 shares of restricted common stock to investors for cash proceeds of $155,000. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The consolidated financial statements of the Company include the accounts of KUTG and its wholly-owned subsidiary, KTC. All significant intercompany transactions have been eliminated in the consolidation. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates Preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, together with amounts disclosed in the related notes to the financial statements. The Company’s significant estimates used in these financial statements include, but are not limited to, fair value calculations for equity securities, stock-based compensation, the collectability of receivables, inventory valuations, the recoverability and useful lives of long-lived assets, and the valuation allowance related to the Company’s deferred tax assets. Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company’s estimates and could cause actual results to differ from those estimates. See Note 3 - Summary of Significant Accounting Policies — Stock-Based Compensation for additional discussion of the use of estimates in estimating the fair value of the Company’s common stock. |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Concentrations of Credit Risk The Company maintains cash with major financial institutions. Cash held in U.S. bank institutions is currently insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 at each institution. There were aggregate uninsured cash balances of $0 and $611,450 at December 31, 2018 and 2017, respectively. Customer concentrations are as follows: Revenues Accounts Receivable For the Years Ended December 31, As of December 31, 2018 2017 2018 2017 Customer A 66 % 49 % 63 % 43 % Customer B 13 % * * * Customer C * 14 % * 24 % Customer D * * 37 % * Customer E * * * 15 % Total 79 % 63 % 100 % 82 % * Less than 10% |
Trade and Other Accounts Receivable, Policy [Policy Text Block] | Accounts Receivable Accounts receivable are carried at their contractual amounts, less an estimate for uncollectible amounts. As of December 31, 2018 and 2017, there were no allowances for uncollectable amounts determined to be necessary. Management estimates the allowance for bad debts based on existing economic conditions, the financial conditions of the customers, and the amount and age of past due accounts. Receivables are considered past due if full payment is not received by the contractual due date. Past due accounts are generally written off against the allowance for bad debts only after all collection attempts have been exhausted. |
Inventory, Policy [Policy Text Block] | Inventory Inventory is comprised of carbon fiber thermal interface solutions, which are available for sale. Inventories are stated at the lower of cost and net realizable value. Cost is determined by the first-in, first-out method. Inventory that is sold to third parties is included within cost of sales and inventory that is given as samples is included within operating expenses. The Company periodically reviews for slow-moving, excess or obsolete inventories. Products that are determined to be obsolete, if any, are written down to net realizable value. As of December 31, 2018 and 2017, the Company’s inventory was comprised solely of finished goods. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation which is recorded commencing at the in-service date using the straight-line method at rates sufficient to charge the cost of depreciable assets to operations over their estimated useful lives, which range from 3 to 7 years. Leasehold improvements are amortized over the lesser of (a) the useful life of the asset; or (b) the remaining lease term. Maintenance and repairs are charged to operations as incurred. The Company capitalizes cost attributable to the betterment of property and equipment when such betterment extends the useful life of the assets. The Company reviews for the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss would be recognized when the present value of estimated future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying value. |
Fair Value Measurement, Policy [Policy Text Block] | Fair Value of Financial Instruments The Company measures the fair value of financial assets and liabilities based on the guidance of ASC 820 “Fair Value Measurements and Disclosures” (“ASC 820”) which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value: Level 1 — quoted prices in active markets for identical assets or liabilities Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable Level 3 — inputs that are unobservable (for example, cash flow modeling inputs based on assumptions) The carrying amounts of the Company’s financial instruments, such as cash, accounts receivable and accrued expenses and other current liabilities approximate fair values due to the short-term nature of these instruments. |
Preferred Stock [Policy Text Block] | Preferred Stock The Company applies the accounting standards for distinguishing liabilities from equity when determining the classification and measurement of its preferred stock. Preferred shares subject to mandatory redemption are classified as liability instruments and are measured at fair value. Conditionally redeemable preferred shares (including preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, preferred shares are classified as stockholders’ equity. During the year ended December 31, 2018, the Company obtained a third-party 409A valuation of its Series B Convertible Preferred Stock, which was considered in management’s estimation of the value of the equity instruments issued during that period. Under the 409A valuation, it was determined the Company’s Series B Convertible Preferred Stock had a fair value of $33.00 per share. |
Convertible Instruments Policy [Policy Text Block] | Convertible Instruments The Company evaluates its convertible instruments to determine if those contracts or embedded components of those contracts qualify as derivative financial instruments to be separately accounted for in accordance with Topic 815 of the FASB ASC. The accounting treatment of derivative financial instruments requires that the Company record embedded conversion options and any related freestanding instruments at their fair values as of the inception date of the agreement and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, non-cash income or expense for each reporting period at each balance sheet date. The Company reassesses the classification of its derivative instruments at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. Embedded conversion options and any related freestanding instruments are recorded as a discount to the host instrument. If the instrument is determined to be a derivative liability, the Company then evaluates for the existence of a beneficial conversion feature by comparing the market price of the Company’s common stock as of the commitment date to the effective conversion price of the instrument. |
Stock Issuance Costs Policy [Policy Text Block] | Offering Costs Deferred offering costs, which primarily consist of direct, incremental professional fees incurred in connection with a debt or equity financing, are capitalized as non-current assets on the balance sheet. Once the financing closes, the Company reclassifies such costs as either discounts to notes payable or as a reduction of proceeds received from equity transactions so that such costs are recorded as a reduction of additional paid-in capital. If the completion of a contemplated financing was deemed to be no longer probable, the related deferred offering costs would be charged to general and administrative expense in the consolidated financial statements. |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition On January 1, 2018, the Company adopted 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 than required under existing U.S. GAAP 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 adopted ASC 606 for all applicable contracts using the modified retrospective method, which would have required a cumulative-effect adjustment, if any, as of the date of adoption. The adoption of ASC 606 did not have a material impact on the Company's consolidated financial statements as of the date of adoption. As a result, a cumulative-effect adjustment was not required. The Company recognizes revenue primarily from the following different types of contracts: Product sales – Revenue is recognized at the point the customer obtains controls 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 contract services to the customer. The following table summarizes our revenue recognized in our consolidated statements of operations: For the Years Ended December 31, 2018 2017 Product sales $ 1,096,040 $ 215,271 Contract services 177,988 20,313 Total revenue $ 1,274,028 $ 235,584 As of December 31, 2018 and 2017, the Company did not have any contract assets and contract liabilities 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 years ended December 31, 2018, and 2017, $0 of revenue was recognized from performance obligations satisfied (or partially satisfied) in previous periods. |
Reclassification, Policy [Policy Text Block] | Reclassifications Certain prior year financial statement amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations. |
Shipping and Handling Cost, Policy [Policy Text Block] | Shipping and Handling Costs Shipping and handling costs incurred by the Company as well as fees received by customers for product shipped to customers are included in selling, general and administrative expenses on the consolidated statements of operations. For the years ended December 31, 2018 and 2017, shipping and handling costs amounted to $932 and $0, respectively. |
Research and Development Expense, Policy [Policy Text Block] | Research and Development Research and development expenses are charged to operations as incurred. During the years ended December 31, 2018 and 2017, the Company incurred $508,144 and $801,055, respectively, of research and development expenses. |
Advertising Costs, Policy [Policy Text Block] | Advertising Costs Advertising costs are expensed in the period incurred. Advertising costs charged to operations for the years ended December 31, 2018 and 2017 were $12,500 and $65,085, respectively, and are included in selling, general and administrative on the consolidated statements of operations. |
Compensation Related Costs, Policy [Policy Text Block] | Stock-Based Compensation The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award. The fair value of the award is measured on the grant date. The fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. Upon the exercise of an award, the Company issues new shares of common stock out of its authorized shares. During the year ended December 31, 2018, the Company obtained a third-party 409A valuation of its common stock, which was also considered in management’s estimation of the value of the equity instruments issued during that period. Under the 409A valuation, it was determined the Company’s common stock had a fair value of $0.66 per share. |
Earnings Per Share, Policy [Policy Text Block] | 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 and dilutive common-equivalent shares outstanding during each period. Dilutive common-equivalent shares consist of shares of non-vested restricted stock, if not anti-dilutive. The following shares were excluded from the calculation of weighted average dilutive common shares because their inclusion would have been anti-dilutive: Decemeber 31, 2018 2017 Non-vested restricted stock - 312,500 Series B Convertible Preferred Stock 1,542,850 - Total 1,542,850 312,500 |
Income Tax, Policy [Policy Text Block] | Income Taxes The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of items that have been included or excluded in the financial statements or tax returns. Deferred tax assets and liabilities are determined on the basis of the difference between the tax basis of assets and liabilities and their respective financial reporting amounts (“temporary differences”) at enacted tax rates in effect for the years in which the temporary differences are expected to reverse. The Company utilizes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Management has evaluated and concluded that there were no material uncertain tax positions requiring recognition in the Company’s financial statements as of December 31, 2018 and 2017. The Company does not expect any significant changes in its unrecognized tax benefits within twelve months of the reporting date. The Company’s policy is to classify assessments, if any, for tax related interest as interest expense and penalties as selling, general and administrative expenses in the consolidated statements of operations. |
Subsequent Events, Policy [Policy Text Block] | Subsequent Events The Company has evaluated subsequent events through the date which the consolidated financial statements were issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the consolidated financial statements, except as disclosed. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02, "Leases (Topic 842)." ASU 2016-02 requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. This amendment will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The FASB issued ASU No. 2018-10 “Codification Improvements to Topic 842, Leases” and ASU No. 2018-11 “Leases (Topic 842) Targeted Improvements" in July 2018, and ASU No. 2018-20 "Leases (Topic 842) - Narrow Scope Improvements for Lessors" in December 2018. ASU 2018-10 and ASU 2018-20 provide certain amendments that affect narrow aspects of the guidance issued in ASU 2016-02. ASU 2018-11 allows all entities adopting ASU 2016-02 to choose an additional (and optional) transition method of adoption, under which an entity initially applies the new leases standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company adopted ASU 2016-02 effective January 1, 2019 In May 2017, the FASB issued ASU No. 2017-09, “Compensation — Stock Compensation (Topic 718): Scope of Modification Accounting,” (“ASU 2017-09”). ASU 2017-09 provides clarity on the accounting for modifications of stock-based awards. ASU 2017-09 requires adoption on a prospective basis in the annual and interim periods for fiscal years beginning after December 15, 2017 for share-based payment awards modified on or after the adoption date. The Company adopted ASU 2017-09 effective January 1, 2018 and its adoption did not have a material impact on the Company’s consolidated financial statements. In July 2017, the FASB issued ASU No. 2017-11, “Earnings Per Share (Topic 260) and Derivatives and Hedging (Topic 815) — Accounting for Certain Financial Instruments with Down Round Features,” (“ASU 2017-11”). Equity-linked instruments, such as warrants and convertible instruments may contain down round features that result in the strike price being reduced on the basis of the pricing of future equity offerings. Under ASU 2017-11, a down round feature will no longer require a freestanding equity-linked instrument (or embedded conversion option) to be classified as a liability that is remeasured at fair value through the income statement (i.e. marked-to-market). However, other features of the equity-linked instrument (or embedded conversion option) must still be evaluated to determine whether liability or equity classification is appropriate. Equity classified instruments are not marked-to-market. For earnings per share (“EPS”) reporting, the ASU requires companies to recognize the effect of the down round feature only when it is triggered by treating it as a dividend and as a reduction of income available to common shareholders in basic EPS. The amendments in this ASU are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted, including adoption in any interim period. The In June 2018, the FASB issued ASU No. 2018-07, “Compensation — Stock Compensation (Topic 718),” (“ASU 2018-07”). ASU 2018-07 is intended to reduce cost and complexity and to improve financial reporting for nonemployee share-based payments. Currently, the accounting requirements for nonemployee and employee share-based payment transactions are significantly different. ASU 2018-07 expands the scope of Topic 718, Compensation — Stock Compensation (which currently only includes share-based payments to employees) to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. This ASU supersedes Subtopic 505-50, Equity — Equity-Based Payments to Nonemployees. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018, and interim periods within that fiscal year. Early adoption is permitted, but no earlier than a company’s adoption date of Topic 606, Revenue from Contracts with Customers. The Company early adopted ASU 2018-07 effective April 1, 2018. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements. In July 2018, the FASB issued ASU No. 2018-09, “Codification Improvements” (“ASU 2018-09”). These amendments provide clarifications and corrections to certain ASC subtopics including the following: Income Statement - Reporting Comprehensive Income – Overall (Topic 220-10), Debt - Modifications and Extinguishments (Topic 470-50), Distinguishing Liabilities from Equity – Overall (Topic 480-10), Compensation - Stock Compensation - Income Taxes (Topic 718-740), Business Combinations - Income Taxes (Topic 805-740), Derivatives and Hedging – Overall (Topic 815-10), and Fair Value Measurement – Overall (Topic 820-10). The majority of the amendments in ASU 2018-09 will be effective in annual periods beginning after December 15, 2018. The Company expects to adopt ASU 2018-09 effective January 1, 2019 and its adoption is not expected to have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). The amendments in ASU 2018-13 modify the disclosure requirements on fair value measurements based on the concepts in the Concepts Statement, including the consideration of costs and benefits. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. The amendments are effective for all entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements. In November 2018, the FASB issued ASU No. 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606 (“ASU 2018-18”), which clarifies that certain transactions between participants in a collaborative arrangement should be accounted for under ASC 606 when the counterparty is a customer. In addition, ASU 2018-18 precludes an entity from presenting consideration from a transaction in a collaborative arrangement as revenue from contracts with customers if the counterparty is not a customer for that transaction. For public business entities, the amendments in this update are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021. Early adoption is permitted, including adoption in any interim period, (1) for public business entities for periods for which financial statements have not yet been issued and (2) for all other entities for periods for which financial statements have not yet been made available for issuance. An entity may not adopt the amendments earlier than its adoption date of Topic 606. The amendments in this Update should be applied retrospectively to the date of initial application of Topic 606. An entity should recognize the cumulative effect of initially applying the amendments as an adjustment to the opening balance of retained earnings of the later of the earliest annual period presented and the annual period that includes the date of the entity’s initial application of Topic 606. An entity may elect to apply the amendments in this Update retrospectively either to all contracts or only to contracts that are not completed at the date of initial application of Topic 606. An entity should disclose its election. An entity may elect to apply the practical expedient for contract modifications that is permitted for entities using the modified retrospective transition method in Topic 606. The Company is currently evaluating the effect that adopting this new accounting guidance will have on its consolidated financial statements and related disclosures. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedules of Concentration of Risk, by Risk Factor [Table Text Block] | Customer concentrations are as follows: Revenues Accounts Receivable For the Years Ended December 31, As of December 31, 2018 2017 2018 2017 Customer A 66 % 49 % 63 % 43 % Customer B 13 % * * * Customer C * 14 % * 24 % Customer D * * 37 % * Customer E * * * 15 % Total 79 % 63 % 100 % 82 % * Less than 10% |
Revenue from External Customers by Products and Services [Table Text Block] | The following table summarizes our revenue recognized in our consolidated statements of operations: For the Years Ended December 31, 2018 2017 Product sales $ 1,096,040 $ 215,271 Contract services 177,988 20,313 Total revenue $ 1,274,028 $ 235,584 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | The following shares were excluded from the calculation of weighted average dilutive common shares because their inclusion would have been anti-dilutive: Decemeber 31, 2018 2017 Non-vested restricted stock - 312,500 Series B Convertible Preferred Stock 1,542,850 - Total 1,542,850 312,500 |
PREPAID EXPENSES (Tables)
PREPAID EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Prepaid Expense, Current [Abstract] | |
Schedule of Prepaid Expenses [Table Text Block] | As of December 31, 2018 and 2017, prepaid expenses consisted of the following: Decemeber 31, 2018 2017 Business development services $ - $ 40,000 Research and development services 7,500 25,000 Professional fees 94 10,000 Filing fees 8,750 - Insurance 8,177 - Other 2,512 31,466 Total prepaid expenses $ 27,033 $ 106,466 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment [Table Text Block] | As of December 31, 2018 and 2017, property and equipment consisted of the following: December 31, 2018 2017 Computer equipment $ 13,356 $ 8,402 Leasehold improvement 8,834 8,834 Software 5,656 5,656 Machinery and equipment 26,304 17,954 Research and development equipment 12,810 12,811 Furniture and fixtures 3,306 - 70,266 53,657 Less: accumulated deprecation (25,475 ) (10,164 ) Property and equipment, net $ 44,791 $ 43,493 |
ACCRUED EXPENSES AND OTHER CU_2
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounts Payable and Accrued Liabilities, Current [Abstract] | |
Schedule of Accounts Payable and Accrued Liabilities [Table Text Block] | As of December 31, 2018 and 2017, accrued expenses and other current liabilities consisted of the following: December 31, 2018 2017 Accrued payroll and vacation $ 252,043 $ 69,847 Accrued legal and professional fees 47,502 67,933 Accrued travel expenses 48,248 28,254 Payroll and income tax payable 12,678 14,223 Accrued research and development expenses 2,850 - Credit card payable 4,586 110 Accrued issuable equity 3,960 1,104 Accrued rent 176 - Other 2,287 7,471 Total accrued expenses and other current liabilities $ 374,330 $ 188,942 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | The income tax provision for the years ended December 31, 2018 and 2017 consists of the following: For The Years Ended December 31, 2018 2017 Federal: Current $ - $ - Deferred (347,767 ) (393,945 ) State and local: Current - - Deferred (121,933 ) (175,455 ) (469,700 ) (569,400 ) Change in valuation allowance 469,700 569,400 Income tax provision $ - $ - |
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | A reconciliation of the statutory federal income tax rate to the Company’s effective tax rate is as follows: For The Years Ended December 31, 2018 2017 Tax benefit at federal statutory rate (21.0 )% (34.0 )% State income taxes, net of federal benefit (6.0 )% (6.0 )% Permanent differences 0.2 % 0.4 % Incremental research and development tax credits 0.0 % (2.9 )% Prior year true-ups 4.0 % 0.0 % Change in valuation allowance 22.8 % 20.8 % Change in federal tax rate 0.0 % 21.7 % Effective income tax rate (0.0 )% 0.0 % |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | The tax effects of temporary differences that give rise to deferred tax assets and liabilities are presented below: For The Years Ended December 31, 2018 2017 Deferred Tax Assets: Net operating loss carryforwards $ 1,544,300 $ 1,062,400 Research and development credit carryforwards - 79,000 Stock-based compensation 187,200 184,400 Accruals 64,000 - Gross deferred tax assets 1,795,500 1,325,800 Valuation allowance (1,795,500 ) (1,325,800 ) Deferred tax asset, net of valuation allowance $ - $ - Changes in valuation allowance $ 469,700 $ 569,400 |
STOCKHOLDERS' (DEFICIENCY) EQ_2
STOCKHOLDERS' (DEFICIENCY) EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Share-based Compensation, Activity [Table Text Block] | A summary of restricted stock award activity during the year ended December 31, 2018 is presented below: Weighted Average Grant Date Total Number of Fair Value Grant Date Shares Per Share Fair Value Non-vested, December 31, 2017 312,500 $ 0.99 $ 309,375 Granted - - - Vested (312,500 ) (0.99 ) (309,375 ) Forfeited - - - Non-vested, December 31, 2018 - $ - $ - |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | In applying the Black-Scholes option pricing model, the Company used the following assumptions: For the Years Ended Decemeber 31, 2018 2017 Risk free interest rate 2.50 % N/A Expected term (years) 3.09 N/A Expected volatility 87.00 % N/A Expected dividends 0.00 % N/A Estimated fair value of common stock $ 0.66 N/A |
Share-based Compensation, Stock Options, Activity [Table Text Block] | A summary of options activity during the year ended December 31, 2018 is presented below: Weighted Weighted Average Average Number of Exercise Remaining Intrinsic Options Price Term (Yrs) Value Outstanding, December 31, 2017 - $ - Granted 300,000 0.66 Exercised - - Expired - - Forfeited - - Outstanding, December 31, 2018 300,000 $ 0.66 5.0 $ - Exercisable, December 31, 2018 60,000 $ 0.66 5.0 $ - The following table presents information related to stock options as of December 31, 2018: Options Outstanding Options Exercisable Outstanding Weighted Average Exercisable Exercise Number of Remaining Life Number of Price Options In Years Options $ 0.66 300,000 5.0 60,000 300,000 5.0 60,000 |
BUSINESS ORGANIZATION AND NAT_2
BUSINESS ORGANIZATION AND NATURE OF OPERATIONS (Details Textual) - shares | 1 Months Ended | |
Jun. 19, 2017 | Jun. 08, 2017 | |
Equity Method Investment, Ownership Percentage | 64.57% | |
KULR Technology Corporation [Member] | ||
Reverse Recapitalization, Number of Shares to be Acquired | 25,000,000 | |
Stock Issued During Period, Shares, New Issues | 50,000,000 | |
Percentage of Shareholders | 100.00% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | ||||
Revenues [Member] | |||||
Concentration Risk, Percentage | 79.00% | 63.00% | |||
Accounts Receivable [Member] | |||||
Concentration Risk | 100.00% | 82.00% | |||
Customer A [Member] | Revenues [Member] | |||||
Concentration Risk, Percentage | 66.00% | 49.00% | |||
Customer A [Member] | Accounts Receivable [Member] | |||||
Concentration Risk | 63.00% | 43.00% | |||
Customer B [Member] | Revenues [Member] | |||||
Concentration Risk, Percentage | 13.00% | [1] | |||
Customer B [Member] | Accounts Receivable [Member] | |||||
Concentration Risk | [1] | ||||
Customer C [Member] | Revenues [Member] | |||||
Concentration Risk, Percentage | [1] | 14.00% | |||
Customer C [Member] | Accounts Receivable [Member] | |||||
Concentration Risk | [1] | 24.00% | |||
Customer D [Member] | Revenues [Member] | |||||
Concentration Risk, Percentage | [1] | ||||
Customer D [Member] | Accounts Receivable [Member] | |||||
Concentration Risk | 37.00% | [1] | |||
Customer E [Member] | Revenues [Member] | |||||
Concentration Risk, Percentage | [1] | ||||
Customer E [Member] | Accounts Receivable [Member] | |||||
Concentration Risk | [1] | 15.00% | |||
[1] | Less than 10% |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Total revenue | $ 1,274,028 | $ 235,584 |
Product sales [Member] | ||
Total revenue | 1,096,040 | 215,271 |
Contract services [Member] | ||
Total revenue | $ 177,988 | $ 20,313 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) - Earnings per share diluted [Member] - shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,542,850 | 312,500 |
Restricted Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 312,500 |
Series B Convertible Preferred Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,542,850 | 0 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Research and Development Expense Including Related Party | $ 508,144 | $ 801,055 |
Cash, FDIC Insured Amount | 250,000 | 250,000 |
Cash, Uninsured Amount | 0 | 611,450 |
Revenue Recognized | 0 | 0 |
Advertising Expense | $ 12,500 | 65,085 |
Share Price | $ 0.66 | |
Shipping and Handling [Member] | Selling, General and Administrative Expenses [Member] | ||
Cost of Goods and Services Sold | $ 932 | $ 0 |
Minimum [Member] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Maximum [Member] | ||
Property, Plant and Equipment, Useful Life | 7 years |
PREPAID EXPENSES (Details)
PREPAID EXPENSES (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Total prepaid expenses | $ 27,033 | $ 106,466 |
Business development services [Member] | ||
Business development services | 0 | 40,000 |
Research and development services | 7,500 | 25,000 |
Professional fees | 94 | 10,000 |
Filing fees | 8,750 | 0 |
Insurance | 8,177 | 0 |
Other | 2,512 | 31,466 |
Total prepaid expenses | $ 27,033 | $ 106,466 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 70,266 | $ 53,657 |
Less: accumulated deprecation | (25,475) | (10,164) |
Property and equipment, net | 44,791 | 43,493 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 13,356 | 8,402 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 8,834 | 8,834 |
Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 5,656 | 5,656 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 26,304 | 17,954 |
Research And Development Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 12,810 | 12,811 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 3,306 | $ 0 |
PROPERTY AND EQUIPMENT (Detai_2
PROPERTY AND EQUIPMENT (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation | $ 15,311 | $ 8,797 |
ACCRUED EXPENSES AND OTHER CU_3
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Accrued payroll and vacation | $ 252,043 | $ 69,847 |
Accrued legal and professional fees | 47,502 | 67,933 |
AccruedTravel Expenses | 48,248 | 28,254 |
Payroll and income tax payable | 12,678 | 14,223 |
Accrued research and development expenses | 2,850 | 0 |
Credit card payable | 4,586 | 110 |
Accrued issuable equity | 3,960 | 1,104 |
Accrued rent | 176 | 0 |
Other | 2,287 | 7,471 |
Total accrued expenses and other current liabilities | $ 374,330 | $ 188,942 |
ACCRUED EXPENSES AND OTHER CU_4
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details Textual) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Accrued issuable Equity | $ 3,960 | $ 1,104 |
Issuable Equity, Accrued | 6,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Textual) - USD ($) | Nov. 11, 2017 | Jun. 13, 2017 | Jun. 02, 2014 | Dec. 20, 2018 | Dec. 31, 2018 | Dec. 31, 2017 |
Related Party Transaction [Line Items] | ||||||
Due to Other Related Parties, Current | $ 83,919 | $ 254,344 | ||||
Repayment of Notes Receivable from Related Parties | $ 85,000 | |||||
Retainer Fee Description | KULR entered into consulting agreements with its CEO and CTO. The agreements provide for a monthly retainer of $6,250 for June 2014 through November 2014 and $6,500 thereafter. | |||||
Adjustments to Additional Paid in Capital, Other | 135,000 | |||||
Other Research and Development Expense | 0 | 439,824 | ||||
Interest Income, Notes Receivable | 0 | 1,336 | ||||
Research and Development Expense [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Adjustments to Additional Paid in Capital, Other | $ 135,000 | |||||
Consulting Agreements [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Related Party Transaction, Expenses from Transactions with Related Party | 0 | 57,000 | ||||
Chief Technology Officer CTO [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Due To Related Parties WriteOff | $ 50,000 | |||||
Chief Technology Officer CTO [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Due to Other Related Parties, Current | 83,919 | 254,344 | ||||
Adjustments to Additional Paid in Capital, Other | 110,000 | |||||
Energy Science Laboratories, Inc ESLI [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Other Research and Development Expense | $ 0 | $ 407,324 | ||||
Chief Executive Officer [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Interest Receivable, Current | $ 3,488 | |||||
Adjustments to Additional Paid in Capital, Other | $ 25,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Federal: | ||
Current | $ 0 | $ 0 |
Deferred | (347,767) | (393,945) |
State and local: | ||
Current | 0 | 0 |
Deferred | (121,933) | (175,455) |
Income Tax Expense Benefit, Federal, State And local, Net | (469,700) | (569,400) |
Change in valuation allowance | 469,700 | 569,400 |
Income tax provision | $ 0 | $ 0 |
INCOME TAXES (Details1)
INCOME TAXES (Details1) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Tax benefit at federal statutory rate | (21.00%) | (34.00%) |
State income taxes, net of federal benefit | (6.00%) | (6.00%) |
Permanent differences | 0.20% | 0.40% |
Incremental research and development tax credits | 0.00% | (2.90%) |
Prior year true-ups | 4.00% | 0.00% |
Change in valuation allowance | 22.80% | 20.80% |
Change in federal tax rate | 0.00% | 21.70% |
Effective income tax rate | (0.00%) | 0.00% |
INCOME TAXES (Details 2)
INCOME TAXES (Details 2) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Components of Deferred Tax Assets [Abstract] | ||
Net operating loss carryforwards | $ 1,544,300 | $ 1,062,400 |
Research and development credit carryforwards | 0 | 79,000 |
Stock-based compensation | 187,200 | 184,400 |
Accruals | 64,000 | 0 |
Gross deferred tax assets | 1,795,500 | 1,325,800 |
Valuation allowance | (1,795,500) | (1,325,800) |
Deferred tax asset, net of valuation allowance | 0 | 0 |
Changes in valuation allowance | $ 469,700 | $ 569,400 |
INCOME TAXES (Details Textual)
INCOME TAXES (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Operating Loss Carryforwards | $ 5,700,000 | $ 3,900,000 |
Operating Loss Carryforwards, Limitations on Use | The net operating loss carryovers may be subject to annual limitations under Internal Revenue Code Section 382, and similar state provisions, should there be a greater than 50% ownership change as determined under the applicable income tax regulations. | |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 34.00% |
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount | $ 600,000 | |
Operating Loss Carry forwards Expiration Year | net operating losses will expire from 2033 to 2037 | |
Deferred Tax Assets, Operating Loss Carryforwards, Subject to Expiration | $ 3,900,000 | |
Deferred Tax Assets, Operating Loss Carryforwards, Not Subject to Expiration | 1,800,000 | |
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | $ 469,700 | $ 569,400 |
STOCKHOLDERS' (DEFICIENCY) EQ_3
STOCKHOLDERS' (DEFICIENCY) EQUITY (Details) - Restricted Stock [Member] | 12 Months Ended |
Dec. 31, 2018USD ($)$ / sharesshares | |
Number ofshares, Non-vested, December 31, 2016 | shares | 312,500 |
Number ofshares, Granted | shares | 0 |
Number ofshares, Vested | shares | (312,500) |
Number ofshares, Forfeited | shares | 0 |
Number ofshares, Non-vested, December 31, 2017 | shares | 0 |
Weighted Average Grant Date Fair Value Per Share, Non-vested, December 31, 2016 | $ / shares | $ 0.99 |
Weighted Average Grant Date Fair Value Per Share, Granted | $ / shares | 0 |
Weighted Average Grant Date Fair Value Per Share, Vested | $ / shares | (0.99) |
Weighted Average Grant Date Fair Value Per Share, Forfeited | $ / shares | 0 |
Weighted Average Grant Date Fair Value Per Share, Non-vested, December 31, 2017 | $ / shares | $ 0 |
Total Grant Date Fair Value, Non-vested, December 31, 2016 | $ | $ 309,375 |
Total Grant Date Fair Value, Granted | $ | 0 |
Total Grant Date Fair Value, Vested | $ | (309,375) |
Total Grant Date Fair Value, Forfeited | $ | 0 |
Total Grant Date Fair Value, Non-vested, December 31, 2017 | $ | $ 0 |
STOCKHOLDERS' (DEFICIENCY) EQ_4
STOCKHOLDERS' (DEFICIENCY) EQUITY (Details 1) | 12 Months Ended |
Dec. 31, 2018 | |
Risk free interest rate | 2.50% |
Expected term | 3 years 1 month 2 days |
Expected volatility | 87.00% |
Expected dividends | 0.00% |
Estimated fair value of common stock | 0.66 |
STOCKHOLDERS' (DEFICIENCY) EQ_5
STOCKHOLDERS' (DEFICIENCY) EQUITY (Details 2) - USD ($) | 1 Months Ended | 12 Months Ended |
Dec. 28, 2018 | Dec. 31, 2018 | |
Number of Options,Outstanding, December 31, 2017 | 0 | |
Number of Options,Granted | 300,000 | 300,000 |
Number of Options,Exercised | 0 | |
Number of Options,Expired | 0 | |
Number of Options,Forfeited | 0 | |
Number of Options,Outstanding, December 31, 2018 | 300,000 | |
Number of Options,Exercisable, December 31, 2018 | 60,000 | |
Weighted Average Exercise Price,Outstanding, December 31, 2017 | $ 0 | |
Weighted Average Exercise Price,Granted | $ 0.66 | 0.66 |
Weighted Average Exercise Price,Exercised | 0 | |
Weighted Average Exercise Price,Expired | 0 | |
Weighted Average Exercise Price,Forfeited | 0 | |
Weighted Average Exercise Price Outstanding, December 31, 2017 | 0.66 | |
Weighted Average Exercise Price Exercisable, December 31, 2018 | $ 0.66 | |
Weighted Average Remaining Term,Outstanding, December 31, 2018 | 5 years | |
Weighted Average Remaining Term,Exercisable, December 31, 2018 | 5 years | |
Number of Options Intrinsic Value,Outstanding, December 31, 2018 | $ 0 | |
Number of Options Intrinsic Value,Exercisable, December 31, 2018 | $ 0 |
STOCKHOLDERS' (DEFICIENCY) EQ_6
STOCKHOLDERS' (DEFICIENCY) EQUITY (Details 3) - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Options Outstanding,Exercise Price | $ 0.66 | |
Options Outstanding,Number of Options | 300,000 | 0 |
Options Exercisable,Weighted Average Remaining Life | 5 years | |
Options Exercisable Number of Options | 60,000 | |
0.66 Exercise Price [Member] | ||
Options Outstanding,Exercise Price | $ 0.66 | |
Options Outstanding,Number of Options | 300,000 | |
Options Exercisable,Weighted Average Remaining Life | 5 years | |
Options Exercisable Number of Options | 60,000 |
STOCKHOLDERS' (DEFICIENCY) EQ_7
STOCKHOLDERS' (DEFICIENCY) EQUITY (Details Textual) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Dec. 28, 2018 | Nov. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Nov. 05, 2018 | ||
Common Stock, Shares Authorized | 500,000,000 | 500,000,000 | ||||
Preferred Stock, Shares Authorized | 20,000,000 | 20,000,000 | ||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | ||||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | ||||
Stock Issued During Period, Value, Restricted Stock Award, Gross | $ 32,000 | |||||
Preferred Stock, Shares Issued | 0 | 0 | ||||
Proceeds from Convertible Debt | $ 30,858 | $ 0 | ||||
Proceeds from Issuance of Common Stock | [1] | 679,000 | $ 0 | |||
Stock Issued | $ 6,600 | |||||
Sale of Stock, Number of Shares Issued in Transaction | 10,000 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Option, Nonvested, Weighted Average Exercise Price | $ 0.18 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 300,000 | 300,000 | ||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 0.66 | $ 0.66 | ||||
Share based Compensation Arrangement By Share based Payment Award Options Non vested Weighted Average Aggregate Grant Date Fair Value | $ 113,312 | |||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ 90,649 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years | |||||
Gross Proceeds From Issuance Of Common Stock | $ 714,000 | |||||
Adjustments to Additonal Paid in Capital Series B Convertible Preferred Stock Issued As Deemed Dividend 1 | $ (987,456) | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 174,437 | |||||
Convertible Preferred Stock [Member] | ||||||
Preferred Stock, Par or Stated Value Per Share | $ 33 | |||||
Preferred Stock, Shares Issued | 30,858 | |||||
Preferred Class A [Member] | ||||||
Preferred Stock, Shares Issued | 1,000,000 | |||||
Series B Convertible Preferred Stock [Member] | ||||||
Stock Issued During Period, Shares, New Issues | [2] | 0 | ||||
Preferred Stock, Shares Authorized | 31,000 | 31,000 | 31,000 | |||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | |||||
Preferred Stock, Shares Issued | 30,858 | 0 | ||||
Convertible Preferred Stock, Shares Issued upon Conversion | (50) | |||||
Convertible Preferred Stock, Terms of Conversion | 181 days | |||||
Proceeds from Convertible Debt | $ 30,858 | |||||
Convertible Preferred Stock Fair Value Disclosure | 1,018,314 | |||||
Adjustments to Additonal Paid in Capital Series B Convertible Preferred Stock Issued As Deemed Dividend 1 | $ 987,456 | $ 0 | ||||
Series A Preferred Stock [Member] | ||||||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | ||||
2018 Group Equity Incentive Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 15,000,000 | |||||
General and Administrative Expense [Member] | ||||||
Stock Issued During Period, Value, Issued for Services | $ 598,204 | |||||
Allocated Share-based Compensation Expense | $ 457,713 | |||||
Related Parties [Member] | ||||||
Stock Issued During Period, Value, Restricted Stock Award, Gross | $ 2,000 | |||||
Common Stock [Member] | ||||||
Stock Issued During Period, Shares, New Issues | [2] | 1,081,819 | ||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | |||||
Sale of Stock, Price Per Share | $ 0.66 | |||||
Proceeds from Issuance of Common Stock | $ 672,400 | |||||
Payments of Stock Issuance Costs | $ 41,600 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized | 100,000,000 | |||||
Adjustments to Additonal Paid in Capital Series B Convertible Preferred Stock Issued As Deemed Dividend 1 | $ 0 | |||||
Common Stock [Member] | Cash [Member] | ||||||
Payments of Stock Issuance Costs | $ 35,000 | |||||
[1] | Includes gross proceeds of $714,000, less issuance costs of $35,000. | |||||
[2] | Includes gross proceeds of $714,000, less issuance costs of $41,600 ($35,000 of cash and $6,600 of non-cash). |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Textual) | Mar. 08, 2018USD ($)ft² | Jan. 02, 2017USD ($) | Dec. 30, 2018USD ($) | Mar. 21, 2018USD ($) | Dec. 30, 2017USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jan. 01, 2017ft² |
Area of Land | ft² | 6,754 | 5,296 | ||||||
Operating Lease, Base Rent | $ 8,150 | $ 4,364 | $ 4,452 | $ 4,452 | ||||
Operating Lease, Association Fees | 531 | $ 555 | $ 531 | |||||
Payments Made for Security Deposit | $ 8,150 | $ 8,729 | ||||||
Research and Development Expense | $ 508,144 | $ 361,231 | ||||||
License [Member] | ||||||||
Research and Development Expense | $ 12,000 | |||||||
Minimum [Member] | ||||||||
Royalty Rate | 1.50% | |||||||
Royalty Expense | $ 0 | |||||||
Maximum [Member] | ||||||||
Royalty Rate | 3.75% | |||||||
Royalty Expense | $ 7,500 |
SUBSEQUENT EVENTS (Details Text
SUBSEQUENT EVENTS (Details Textual) - Subsequent Event [Member] | 1 Months Ended |
Jan. 31, 2019USD ($)shares | |
Subsequent Event [Line Items] | |
Stock Issued During Period, Shares, Restricted Stock Award, Gross | shares | 234,849 |
Stock Issued During Period, Value, Issued for Services | $ 25,000 |
Restricted Stock Units (RSUs) [Member] | |
Subsequent Event [Line Items] | |
Proceeds from Issuance of Shares under Incentive and Share-based Compensation Plans, Excluding Stock Options | $ 155,000 |