Quarterly report pursuant to Section 13 or 15(d)

Other Liabilities

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Other Liabilities
 9 Months Ended
Sep. 30, 2011
Other Liabilities  
Other Liabilities
10.
Other Liabilities

Deferred Lease Incentive

On June 29, 2009, the Company entered into a five year office lease agreement as disclosed in Note 18.  The lessor agreed to grant a leasehold improvement allowance of $100,000 to the Company to be used for the construction cost of improvements to the leased property, which included architectural and engineering fees, government agency plan check, permit and other fees, sales and use taxes, testing and inspection costs, and telephone and data cabling and wiring in the premises.  The Company accounts for the benefit of the leasehold improvement allowance as a reduction of rental expense over the five-year term of the office lease.

The following table sets forth the deferred lease incentive:
 
   
September 30,
2011
    
December 31,
2010
  
             
Deferred lease incentive
   $ 100,000     $ 100,000  
Less accumulated amortization
     (45,000 )     (30,000 )
                 
Balance
   $ 55,000     $ 70,000  
 
Deferred Office Lease Expense
 
The office lease agreement, disclosed above, requires an initial annual base rent with annual increases over the next five years.  The Company recognizes rental expense on a straight-line basis over the term of the lease, which resulted in a deferred rent liability of $58,640 and $63,117 as of September 30, 2011 and December 31, 2010, respectively.