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Note 11 - Sale/Leaseback
3 Months Ended
Mar. 31, 2013
Sale Leaseback Transaction Disclosure [Text Block]
11. Sale/Leaseback

On May 24, 2011 (the Closing Date), the Company sold its real property located at 110 Little Falls Road, Fairfield, New Jersey, with the buildings and improvements thereon, and any furniture, machinery, equipment and other personal property (other than property used in the conduct of its laboratory business) that the Company owned and used to operate, repair and maintain the property (the Property), to RCP Birch Road, L.L.C. (the Purchaser). This sale was affected pursuant to an Agreement for Sale of Real Estate, dated as of January 31, 2011, by and between the Company and the Purchaser. In connection with the transfer of title of the Property, on the Closing Date, the Company received an aggregate purchase price of $1,200,000 from the Purchaser. In connection with the transfer of title of the Property, pursuant to the Settlement Agreement, Victory Park and the Levy Parties, respectively, released their primary and secondary mortgages and related liens on the Property (see Notes 6 and 7).

In connection with the sale of the Property, the Company executed a Lease for Real Property, dated as of the Closing Date, pursuant to which the Company has leased the Property from the Purchaser for an initial term of seven years, which may be extended for one renewal term of five years, for an annual base rent during the initial term ranging from $135,000 to $145,000, and up to approximately $156,000 in the renewal term.

After expenses of $80,000, the Company received net proceeds of $1,120,000. The Company’s basis in the land, building and improvements was $303,000. Therefore, the Company will recognize a gain on this transaction in the amount of $817,000. This gain is being recognized ratably over seven years, the length of the lease term. For the three months ended March 31, 2013 and March 31, 2012, the Company recognized a gain in the amount of $29,000, which is reflected in the statements of operations as a reduction in rent expense.