COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2012

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

The Company leases certain office equipment and operating facilities under non-cancellable operating leases that expire at various dates through 2022. Certain leases contain renewal options. Rental payments on certain leases are subject to annual increases based on escalation clauses and increases in the lessor's operating expenses. For the leases that require fixed rental escalations during their lease terms, rent expense is recognized on a straight-line basis resulting in deferred rent. The deferred rent included in other liabilities both current and non-current totaled $8,300,000 of which $7,602,000 related to the lease incentive liability and $293,000 at December 31, 2012 and 2011, respectively. The Company has several office facilities for which it is committed on a month-to-month basis. Total net lease expense was $3,247,000, $2,029,000 and $1,884,000 for the years ended December 31, 2012, 2011 and 2010, respectively.

The schedule below shows the future minimum lease payments required under our operating leases as of December 31, 2012.

	(In Thousands)
Type	2013		2014		2015		2016		2017		Thereafter
Facilities/Office space	$	5,154	$	5,045	$	5,151	$	4,943	$	4,578	$	16,164
Office equipment	44		23		11		—		—		—
Operating Leases	$	5,198	$	5,068	$	5,162	$	4,943	$	4,578	$	16,164

The main operating lease for our headquarters facility is leased from one of our former affiliates. The stockholder ceased being an affiliate of the Company effective September 29, 2011. The current lease space “Milestone” was entered into in May 2012 and continues until May 2022. Total cash paid for the Milestone space including common area maintenance, utilities, and leasehold improvements was $1,540,000 for 2012. Annual lease payments under the Milestone lease approximate $3,231,000 through 2022. We had previously entered into a lease with the same former affiliate. We were released from the majority of that lease upon signing the new lease in May 2012 however, we continue to maintain a presence in part of that facility. Total cash paid for the former space including common area maintenance (“CAM”) charges, utilities, and leasehold improvements was $789,000, $888,000 and $903,000 during the years ended December 31, 2012, December 31, 2011 and December 31, 2010, respectively. Annual lease payments for this lease approximate $493,000 through 2015 with the 2016 term being only four months.

The Company has entered into employment agreements with several executives providing for certain salary levels, severance and change of control provisions through the term of the agreements expiring in February 2015. These agreements have an evergreen clause that extends the agreement by one year each December unless the Company notifies the employee of non-renewal.

In the normal course of business, the Company is involved in various legal matters. It is the opinion of management that these matters do not have a material adverse effect on the Company's financial statements.