10. Long-Term Debt

Debt is summarized below (in thousands):

	September 30, 2015		December 31, 2014
Credit Facility
Credit Facility, variable interest, due March 2019 (1)	$	662,000	$	97,600

Senior Notes (2)
2020 Senior Notes, 6.75% interest, issued November 2010 and due November 2020	—		500,000
2021 Senior Notes, 6.5% interest, net of discount of $— and $413, respectively, issued February and March 2011 and due August 2021	—		324,587
2022 Senior Notes, 6.25% interest, issued October 2011 and due September 2022	—		455,000
2023A Senior Notes, 5.5% interest, net of discount of $5,280 and $5,783, respectively, issued August 2012 and due February 2023	744,720		744,217
2023B Senior Notes, 4.5% interest, issued January 2013 and due July 2023	1,000,000		1,000,000
2024 Senior Notes, 4.875% interest, including premium of $9,934, issued November 2014 and March 2015 and due December 2024	1,159,934		500,000
2025 Senior Notes, 4.875% interest, including discount of $11,302, issued June 2015 and due June 2025	1,188,698		—

Total long-term debt (3)	$	4,755,352	$	3,621,404

(1)

Applicable interest rate was 2.5% for $300.0 million and 4.5% for $362.0 million at September 30, 2015. The applicable interest rate was 4.5% at December 31, 2014. The carrying amount of the Credit Facility approximates fair value due to the short-term and variable nature of the borrowings. The fair value of the Partnership’s Credit Facility is considered a Level 2 measurement.

(2)

The estimated aggregate fair value of the senior notes (collectively, the “Senior Notes”) was approximately $3,820 million and $3,563 million as of September 30, 2015 and December 31, 2014, respectively, based on recent actual prices for OTC secondary market transactions. The fair value of the Partnership’s Senior Notes is considered a Level 2 measurement.

(3)

Accrued interest payable related to the long-term debt was approximately $57.9 million for the nine months ended September 30, 2015, and is included in Accrued liabilities on the accompanying Condensed Consolidated Balance Sheets.

Credit Facility

On March 20, 2014, the Partnership amended the Credit Facility to increase total borrowing capacity to $1.3 billion, extend the maturity by approximately 18 months to March 20, 2019, amend the pricing terms, expand the existing accordion option from $250 million to $500 million and provide the Partnership with the right to release the collateral securing the Credit Facility. The right to release collateral will occur once the Partnership’s long-term, senior unsecured debt (“Index Debt”) has received an investment grade rating from Standard & Poor’s equal to or more favorable than BBB- (stable) and from Moody’s equal to or more favorable than Baa3 (stable) and the Partnership’s Total Leverage Ratio (as defined in the Credit Facility) is not greater than 5.00 to 1.00 (“Collateral Release Date”). The Partnership incurred approximately $2.0 million of deferred financing costs associated with modifications of the Credit Facility during the nine months ended September 30, 2014.

The borrowings under the Credit Facility bear interest at a variable interest rate, plus a margin. The variable interest rate is based either on the London interbank market rate (“LIBO Rate Loans”) or the higher of (a) the prime rate set by the Credit Facility’s administrative agent, (b) the Federal Funds Rate plus 0.50% and (c) the rate for LIBO Rate Loans for a one month interest period plus 1% (“Alternate Base Rate Loans”). Prior to the Collateral Release Date, the margin is determined by the Partnership’s Total Leverage Ratio, ranging from 0.5% to 1.5% for Alternate Base Rate Loans and from 1.5% to 2.5% for LIBO Rate Loans. After the Collateral Release Date, the margin is determined by the credit rating for the Partnership’s Index Debt issued by Moody’s and Standard & Poor’s, ranging from 0.125% to 1% for Alternate Base Rate Loans and from 1.125% to 2% for LIBO Rate Loans. The Partnership may utilize up to $150.0 million of the Credit Facility for the issuance of letters of credit and $10.0 million for shorter-term swingline loans.

Under the provisions of the Credit Facility and indentures, the Partnership is subject to a number of restrictions and covenants. The Credit Facility and indentures place limits on the ability of the Partnership and its restricted subsidiaries to incur additional indebtedness; declare or pay dividends or distributions or redeem, repurchase or retire equity interests or subordinated indebtedness; make investments; incur liens; create any consensual limitation on the ability of the Partnership’s restricted subsidiaries to pay dividends or distributions, make loans or transfer property to the Partnership; engage in transactions with the Partnership’s affiliates; sell assets, including equity interests of the Partnership’s subsidiaries; make any payment on or with respect to or purchase, redeem, defease or otherwise acquire or retire for value any subordinated obligation or guarantor subordination obligation (except principal and interest at maturity); and consolidate, merge or transfer assets. The Credit Facility also limits the Partnership’s ability to enter into transactions with parties that require margin calls under certain derivative instruments. Under the Credit Facility, neither the Partnership nor the bank can require margin calls for outstanding derivative positions.

Significant financial covenants under the Credit Facility include the Interest Coverage Ratio (as defined in the Credit Facility), which must be greater than 2.5 to 1.0 and the Total Leverage Ratio (as defined in the Credit Facility). Prior to the February 2015 amendment, the Total Leverage Ratio was required to be less than 5.5 to 1.0 prior to January 1, 2015, and thereafter until the Collateral Release Date the maximum permissible Total Leverage Ratio was 5.25 to 1.0. In February 2015, the Partnership entered into an amendment which permanently increased the maximum permissible leverage ratio to 5.5 to 1.0 until the Collateral Release Date. The Total Leverage Ratio at any fiscal quarter-end on or after the Collateral Release Date shall not be greater than 5.00 to 1.00.

As of September 30, 2015, the Partnership was in compliance with these financial covenants. These covenants are used to calculate the available borrowing capacity on a quarterly basis. The Credit Facility is guaranteed by and collateralized by substantially all assets of the Partnership’s wholly owned subsidiaries, other than MarkWest Liberty Midstream and its subsidiaries and MarkWest Panola Pipeline, L.L.C. As of September 30, 2015, the Partnership had $662.0 million borrowings outstanding and approximately $8.3 million of letters of credit outstanding under the Credit Facility, leaving approximately $629.7 million of unused capacity all of which was available for borrowing based on financial covenant requirements. Additionally, the full amount of unused capacity is available for borrowing on a short-term basis to provide financial flexibility within a given fiscal quarter.

Senior Notes

In March 2015, the Partnership completed a public offering for $650 million in additional aggregate principal amount of 4.875% unsecured notes due December 2024 (“new notes”), which are additional notes under an indenture pursuant to which the Partnership issued $500 million aggregate principal amount of 4.875% Senior Notes due 2024 on November 21, 2014 (“existing notes”). The new notes and the existing notes are treated as a single class of securities under the indenture (“2024 Senior Notes”). The 2024 Senior Notes mature December 1, 2024. Interest on the new notes commenced accruing on November 21, 2014, and the Partnership pays interest on the notes twice a year on June 1 and December 1. The Partnership received aggregate net proceeds of approximately $653.6 million from the new notes offering, after deducting underwriting fees and third-party expenses and excluding approximately $9.0 million for accrued interest.

In June 2015, the Partnership completed a public offering for $1.2 billion in additional aggregate principal amount of 4.875% unsecured notes due June 2025 (“2025 Senior Notes”). The 2025 Senior Notes mature June 1, 2025. Interest on the 2025 Senior Notes commenced accruing on June 2, 2015, and the Partnership will pay interest on the notes twice a year, beginning on December 1, 2015. The Partnership received aggregate net proceeds of approximately $1,174.9 million from the 2025 Senior Notes offering, after deducting discounts, underwriting fees and third-party expenses and excluding approximately $23.0 million for accrued interest. The proceeds from the issuance of the 2025 Senior Notes, along with the Credit Facility, were used to repurchase $500.0 million of the Partnership’s 6.754% Senior Notes due 2020 (the “2020 Senior Notes”), $325.0 million of the Partnership’s 6.5% Senior Notes due 2021 (the “2021 Senior Notes”) and $455.0 million of the Partnership’s 6.25% Senior Notes due 2022 (the “2022 Senior Notes”).

The Partnership recorded a total pre-tax loss during the nine months ended September 30, 2015 of approximately $117.9 million related to the repurchases of the 2020 Senior Notes, 2021 Senior Notes and 2022 Senior Notes. The pre-tax loss recorded in the second quarter of 2015 consisted of approximately $14.7 million related to the non-cash write-off of the unamortized discount and deferred finance costs and approximately $103.2 million related to the payment of redemption premiums and third party expenses. The loss was recorded in Loss on redemption of debt in the accompanying Condensed Consolidated Statement of Operations.