Markwest extends credit facility, adds $50 million revolver

New York, Feb. 23 - Markwest Hydrocarbon, Inc. said it amended its credit agreement to extend the maturity by a year and to add a $50 million revolver.

The facility, which is via Royal Bank of Canada as administrative agent, is now due on Aug. 20, 2010.

The new revolver is not subject to a borrowing base and will be used to meet margin requirements on the company's derivative agreements.

Interest on the credit facility is at Libor plus 150 to 275 basis points, depending on usage, with a commitment fee of 27.5 to 50 basis points. The new revolver is at Libor plus 325 bps.

Covenants require Markwest to maintain a leverage ratio greater than 4.0 to 1.0, or up to 5.5 to 1.0 in certain circumstances; a minimum net worth of $30.0 million plus 50% of consolidated net income earned from July 1, 2006 onwards 100% of net proceeds of all equity issued by the company after Feb. 16, 2007; and a minimum collateral coverage ratio of 2.0 to 1.0. If the new non-borrowing base revolver is drawn the minimum collateral coverage ratio increases to 3.5 to 1.0.

The change was effective Feb. 16, according to an 8-K filing with the Securities and Exchange Commission.

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