Under the terms of the DAF Credit Agreement, warrants to subscribe for and purchase shares of common stock at an exercise price of per share are available to be issued to DAF. The warrants are being issued in amounts of and per month during the funding period. In the event that funding advances deviate from the planned schedule then warrants will be issued pro-rata at warrants for every of funding. As of warrants have been granted under the terms of the DAF Credit Agreement. The estimated value of the warrants granted monthly, with each advance, is calculated using the Black-Scholes option pricing model. The expected dividend yield is based on the average annual dividend yield as of the grant date. Expected volatility is based on the historical volatility of our stock. The risk-free interest rate is based on the U.S. Treasury Constant Maturity rates as of the grant date. The resulting estimated value of the warrant is used to proportionally allocate the fair value of the debt advance and the fair value of the warrant.

 

The following table summarizes the Company's warrant activity during the months ended

 

Weighted

Weighted

Average

Average

Remaining

Aggregate

Number of

Exercise

Life

Intrinsic

Warrants

Price

In Years

Value

Outstanding, December 31, 2019

570,000

$

0.052

Granted

1,200,000

0.052

Outstanding, September 30, 2020

1,770,000

$

0.052

4.44

$

-

 

 

 

Stock options for employees, directors or consultants that vest immediately, are valued at the date of award, which does precede the approval date, and compensation cost is recognized in the period the options are vested. For options subject to future service conditions, compensation cost is recognized over the vesting period on a straight-line basis.  Stock options generally become exercisable on the date of grant and expire based on the terms of each grant.

 

The estimated fair value of options for common stock granted is determined using the Black-Scholes option pricing model. The expected dividend yield is based on the average annual dividend yield as of the grant date. Expected volatility is based on the historical volatility of our stock. The risk-free interest rate is based on the U.S. Treasury Constant Maturity rates as of the grant date. The expected life of the option is based on historical exercise behavior and expected future experience.

 

The following table summarizes the Company's option activity during the months ended

 

						Weighted Average				Remaining				Aggregate
		Number of				Exercise				Life				Intrinsic
		Options				Price				In Years				Value
Outstanding, December 31, 2019			21,716,557			$	0.076
Expired			(4,383	)			52.50
Exchanged for common stock			(3,000,000	)			0.041
Granted			1,500,000				0.057
Outstanding, September 30, 2020			20,212,174			$	0.068				3.95			$	-
Exercisable, September 30, 2020			19,212,174			$	0.068				3.90			$	-

 

On the Board of Directors consented to a share exchange agreement with holders of options awarded on The agreement allows for holders to exchange their options for rule common stock at an exchange rate of shares per option.  The modification of these options did result in any additional compensation because there was change in the fair value. As of options have been exchanged for shares that were issued under the executed exchange agreement.

 

The following table summarizes the Company's options as of

 

								Weighted
								Average
				Outstanding				Remaining				Exercisable
Exercise				Number of				Life				Number of
Price				Options				In Years				Options
$	0.041				19,000,000				3.88				19,000,000
$	0.065				1,000,000				4.75				-
$	0.240				208,160				6.47				208,160
$	70.260				3,449				1.75				3,449
$	420.000				565				0.62				565
Total					20,212,174				3.95				19,212,174

 

 

The Company be involved in legal proceedings, claims and assessments arising in the ordinary course of business. In the opinion of management, such matters are currently expected to have a material impact on the Company's condensed consolidated financial statements. The Company records legal costs associated with loss contingencies as incurred and accrues for all probable and estimable settlements. 

 

 

The Company had an amended office lease in Tulsa, Oklahoma that expired on The Company was on a month to month basis at per month under the terms of the Tulsa lease. The Company gave notice of termination of the Tulsa office lease and vacated the property on and the security deposit has been refunded.

 

Additionally, on the Company signed a -year office lease in Ann Arbor, Michigan commencing The remaining rent obligation on the Ann Arbor office is ( per month) as of

 

Rent expense for the operating leases was and for the months ended and respectively.

 

 

During the Company entered into a supply agreement with Evonik Operations GmbH to purchase cyclohexasilane, (CHS) for per grams. The supply agreement is valid until The Company paid Evonik Operations GmbH on to initiate production of CHS, in accordance with the agreement.