Stepan Company entered into a new Credit Agreement on September 25, 2026, to replace its existing credit facilities. The new agreement establishes a total committed credit facility of $500.0 million, consisting of a $350.0 million multicurrency revolving credit facility and a $150.0 million delayed draw term loan credit facility. Both facilities are set to mature on September 25, 2031.
The agreement was entered into among Stepan, its foreign subsidiary borrowers, the lenders, JPMorgan Chase Bank, N.A., and Bank of America, N.A. The lenders include JPMorgan Chase Bank, N.A. and BofA Securities, Inc., who serve as joint lead arrangers and joint bookrunners. The new facilities replace the $350.0 million multicurrency revolving credit facility and the $100.0 million delayed draw term loan credit facility that were established under the previous agreement dated June 24, 2022.
Under the terms of the new Credit Agreement, Stepan may draw funds as needed to finance working capital needs, fund permitted acquisitions and capital expenditures, and for general corporate purposes. The agreement also includes an expansion option that allows Stepan to request an increase to the revolving credit facility or to enter into one or more tranches of incremental term loans, with an aggregate amount of up to an additional $250.0 million, subject to certain requirements.
The interest rates for the loans under the Credit Agreement are determined based on Stepan’s net leverage ratio and include a base rate with a spread of 0.125% to 0.625%, a term benchmark rate (comprised of either Adjusted Term SOFR or the Adjusted EURIBOR Rate) with a spread of 1.125% to 1.625%, or the Adjusted Daily Simple RFR with a spread of 1.125% to 1.625%. The agreement also requires the payment of a commitment fee and a ticking fee, each ranging from 0.125% to 0.225% per annum, depending on Stepan’s net leverage ratio.
The Credit Agreement includes financial covenants requiring the maintenance of certain interest coverage and net leverage ratios. It also includes limitations on restricted payments, indebtedness, and liens. The agreement outlines customary events of default, which include the failure to pay principal or interest when due, non-compliance with the financial and operational covenants, non-compliance with other loan documents, the occurrence of a change of control event, and bankruptcy and other insolvency events.
