Since you terminated the lease extension early, you should feel lucky all the landlord wants is your security deposit.

To fully terminate your lease, you should writeup some sort of early termination agreement with both of you signing the document. The document should say something like “In exchange for retention the security deposit, the landlord fully releases you from the lease extension dated 05/01/2009 etc etc.” Without a termination agreement you still owe all rents up to June 2010 less the security deposit.