Advertisement
b) Other long-term assets consist of the following:
---------------------------------------------------------------------------- December 31, 2012 December 31, 2011----------------------------------------------------------------------------Embedded derivative (Note 17) 14,138 -Investment in TerraAqua Resource Management LLC ("TARM") 6,043 6,362Deferred tax asset 2,874 3,732Note receivable 388 652---------------------------------------------------------------------------- 23,443 10,746----------------------------------------------------------------------------TerraAqua Resource Management LLC
During the third quarter of 2011, Newalta acquired a 50% interest in TARM in exchange for cash consideration of $5.8 million. This joint venture is included within other long-term assets. Newalta's interest in TARM is accounted for under the equity method and these consolidated financial statements include Newalta's share of net earnings from the date that joint control commenced, based on the present 50% ownership interest in TARM. Newalta's share of earnings for the year ended December 31, 2012, as well as the assets and liabilities as at December 31, 2012, are not significant.
NOTE 7. SENIOR SECURED DEBT
December 31, 2012 December 31, 2011----------------------------------------------------------------------------Senior secured debt 76,500 70,010Issue costs(1) - (1,517)----------------------------------------------------------------------------Senior secured debt 76,500 68,493----------------------------------------------------------------------------(1) Issue costs related to the facility have been included in prepaid expenses and other in 2012 and will be amortized over the extended credit facility term.
On July 12, 2012, Newalta amended and extended its revolving Credit Facility ("Credit Facility"). The maturity of this Credit Facility is July 12, 2015. The principal borrowing amount was increased from $200 million to $225 million, the maximum Total Debt to EBITDA has been increased from 3.5:1 to 4:1, and the lending syndicate increased from five to six institutions. The Credit Facility is available to fund growth capital expenditures and for general corporate business purposes as well as to provide letters of credit to third parties for financial security up to a maximum amount of $60 million. Newalta may, at its option, request an extension of the credit facility on an annual basis. If no request to extend the Credit Facility is made by Newalta, the entire amount of the outstanding indebtedness would be due in full on July 12, 2015. The facility also requires Newalta to be in compliance with certain covenants. At December 31, 2012, and December 31, 2011, Newalta was in compliance with all covenants.
During the year ended December 31, 2012, credit facility fees of $1.5 million (year ended December 31, 2011 - nil) were incurred in connection with the amending and extending of the revolving credit facility. These fees have been recorded in prepaid expenses and other and will be amortized over the extended credit facility term.
