Note H Offering Costs and Formation Transaction Expenses

In connection with the Consolidation and IPO the Registrant has incurred or will incur incremental accounting fees, legal fees and other professional fees. Such costs will be deferred and recorded as a reduction of proceeds of the Consolidation and IPO, or expensed if the Consolidation and IPO is not consummated. Certain costs associated with the Consolidation and IPO not directly attributable to the solicitation of consents and the IPO, but rather related to structuring the formation transaction, are expensed as incurred.

Through March 31, 2013, Registrant has incurred capitalized external offering costs of $3,453,410, of which the Registrant has incurred $142,725 and $265,464 for the three months ended March 31, 2013 and 2012, respectively. A total of $93,376 and $451,082 of these costs are in Due to Supervisor at March 31, 2013 and December 31, 2012, respectively. Additional offering costs for work done by employees of the Supervisor of $83,271 and $49,099 for the three months ended March 31, 2013 and 2012, respectively, were incurred and advanced by the Supervisor and have been or will be reimbursed to the Supervisor by the Registrant.

Correction of an Immaterial Error in the Financial Statements

The Registrant’s prior period financial results have been adjusted to reflect an immaterial correction which has no impact to the net change in cash reported on the statement of cash flows. During fiscal year 2012, the Registrant determined that certain costs related to the structuring of the consolidation transaction that were previously included in deferred offering costs should have been expensed in the periods incurred. The correction impacted the 2012, 2011 and 2010 periods and had accumulated to an amount of $481,894 as of March 31, 2012. Adhering to applicable guidance for accounting changes and error corrections, the Registrant concluded that the error was not material to any of the prior period financial statements. The correction resulted in immaterial changes to deferred costs and formation transaction expenses for the years ended December 31, 2011 and 2010, and for interim periods within those years and within 2012.

The Registrant applied the guidance for accounting changes and error corrections and revised the prior period financial statements presented.

The following table presents the effect this correction had on our prior period reported financial statements. Additionally, financial information included elsewhere in this Form 10-Q that is impacted by the adjustment have been revised, as applicable.


	For the three months ended March 31, 2012
	As reported			Adjustment			As adjusted
Formation transaction expenses	$	—		$	26,593		$	26,593
Net loss		(104,215	)		(26,593	)		(130,808	)
Net cash provided by operating activities		422,064			(26,593	)		395,471
Net cash used in financing activities		(2,445,079	)		26,593			(2,418,486	)
Net change in cash and cash equivalents		(2,023,015	)		—			(2,023,015	)