On November 30, 2012, the Company acquired all of the issued and outstanding shares of Huron Energy Corporation ("Huron") in exchange for Tourmaline common shares. The acquisition resulted in an increase to Property, Plant and Equipment ("PP&E") of approximately $251.5 million and an increase to Exploration and Evaluation ("E&E") assets of $59.1 million. The acquisition of Huron provides for an increase in lands and production in Tourmaline's key highly profitable core and designated growth area of Sunrise in NEBC.
LIQUIDITY AND CAPITAL RESOURCES
On April 4, 2012, the Company issued 1.4 million flow-through common shares at a price of $28.80 per share for total gross proceeds of $40.4 million. On August 30, 2012, the Company issued 4.039 million common shares at a price of $29.00 per share for total gross proceeds of $117.1 million. Subsequently, on September 19, 2012, the underwriters exercised their over-allotment option and purchased a further 0.6 million shares at a price of $29.00 per share for total gross proceeds of $17.4 million. On November 1, 2012, the Company issued 1.05 million flow-through common shares at a price of $36.90 per share for total gross proceeds of $38.7 million. The proceeds of the above-noted financings were used to temporarily reduce bank debt and to fund the Company's capital exploration program.
In June 2012, the Company amended and restated its bank credit facility to be a covenant-based facility rather than a borrowing base facility. This facility is a 3-year extendible revolving facility in the amount of $550 million plus a $25 million operating revolver from a syndicate of six lenders with an initial maturity date of June, 2015. The maturity date may, at the request of the Company and with the consent of the lenders, be extended on an annual basis. The facility is secured by a first ranking floating charge over all assets of the Company and its material subsidiaries. The facility can be drawn in either Canadian or U.S. funds and bears interest at the bank's prime lending rate, bankers' acceptance rates or LIBOR (for U.S. borrowings), plus applicable margins. The facility will provide the Company with greater flexibility by providing access to an additional $200 million over the previous facility.
Under the terms of the bank credit facility, Tourmaline has provided its covenant that, on a rolling four quarter basis: (i) the ratio of EBITDA to interest expense shall equal or exceed 3.5:1, (ii) the ratio of senior debt to EBITDA shall not exceed 3:1, (iii) the ratio of total debt to EBITDA shall not exceed 4:1, and (iv) the ratio of senior debt to total capitalization shall not exceed 0.5:1. As at December 31, 2012, the Company is in compliance with all debt covenants.
At December 31, 2012, Tourmaline had negative working capital of $103.7 million, after adjusting for the fair value of financial instruments (the unadjusted working capital deficiency was $98.9 million) (December 31, 2011 - $146.6 million and $146.3 million, respectively). Management believes the Company has sufficient liquidity and capital resources to fund the 2013 exploration and development program through expected cash flow from operations, its unutilized bank credit facility and the financing described in the subsequent events section of this MD&A. As at December 31, 2012, the Company's bank debt balance was $360.6 million (December 31, 2011 - $81.7 million), and net debt was $464.3 million (December 31, 2011 - $228.3 million).
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