Constellation Brands Enters Into $300 Million Delayed Draw Term Loan Agreement

Executive Summary

On September 18, 2026, Constellation Brands, Inc. (NYSE: STZ) entered into a Term Loan Credit Agreement with Manufacturers and Traders Trust Company, acting as administrative agent, and participating lenders. The agreement establishes a delayed draw term loan facility for an aggregate principal amount of up to $300 million.

Key Terms of the Credit Agreement

• Facility Size & Structure: Up to $300 million aggregate principal amount available in up to two draws.
• Commitment Period: Commitments terminate on the earliest of (i) full drawing or termination, (ii) funding of the second draw, or (iii) June 18, 2027.
• Maturity: Two years from the initial borrowing date, if any.
• Pricing:
  • Term SOFR Loans: SOFR plus a margin ranging between 0.700% and 1.100% per annum, tiered based on S&P and Moody's credit ratings.
  • Base Rate Loans: Base Rate plus a margin between 0.000% and 0.100% per annum based on credit ratings.
  • Ticking Fee: 0.075% per annum on unused commitments, commencing 30 days after the Effective Date.
• Use of Proceeds: General corporate purposes, including refinancing or repayment of existing indebtedness.

Financial Covenants

The Credit Agreement aligns with Constellation Brands' existing Eleventh Amended and Restated Revolving Credit Agreement:

• Interest Coverage Ratio: Minimum Consolidated Interest Coverage Ratio of 2.50:1.00 as of the end of each fiscal quarter.
• Net Leverage Ratio: Maximum Consolidated Net Leverage Ratio of 4.00:1.00 (allowing netting of up to $750 million in unrestricted cash and cash equivalents), with a temporary step-up to 4.50:1.00 for four fiscal quarters following a Material Acquisition.

Market Impact & Significance

The $300 million delayed draw term loan facility provides flexible short-to-medium-term liquidity for general corporate requirements and debt management. Given the facility size relative to Constellation's overall balance sheet and enterprise value, this is considered a standard liquidity management action with Low trading significance.