Debt Issuance Costs

3 Months Ended

Mar. 31, 2013

Financing Costs [Abstract]

Financing Costs Disclosure [Text Block]

Note 3. Debt Issuance Costs

The Company’s loans have been made pursuant to loan arrangements or guarantees that include the provision of compensation to the lenders or guarantors in the form of Company common stock or warrants. The value of the compensation issued in the form of common stock or warrants is recorded as debt issuance cost and amortized over the term of the loans.

Pursuant to the debt guarantees of the Company’s bank loans and loans received from individual lenders, 829,500 warrants valued at $241,136 were issued or accrued for issuance during the three months ended March 31, 2013 (see Notes 4, 5 and 6). Of this, warrants valued at $73,652 were issued in lieu of amounts previously accrued for issuance in the form of common stock. Bank refinance fees of $2,500 paid in cash were recorded as debt issuance cost and immediately amortized as debt extinguishment expense.

Debt issuance costs are summarized as follows:

	March 31, 2013			December 31, 2012
Debt issuance costs, gross	$	1,957,803		$	1,787,819
Less amortization		(1,942,434	)		(1,782,573	)
Debt issuance costs, net	$	15,369		$	5,246

Debt issuance cost amortization is recorded as either debt extinguishment expense or interest expense, depending on the specific terms of loan amendments. The amortization of debt issuance costs for the three months ended March 31, 2013 and 2012, and the period from August 17, 1999 (Inception) to March 31, 2013 was recorded as follows:

	Three months ended March 31,				August 17, 1999 (Inception) to
	2013		2012		March 31, 2013
Interest expense	$	7,650	$	2,787	$	620,075
Debt extinguishment expense		152,211		79,476		3,375,804
Amortization expense	$	159,861	$	82,273	$	3,995,879