Note 9 – Debt

Foreign currency-denominated borrowings are translated at the applicable reporting period exchange rates, with translation adjustments recorded in AOCI.

As of May 31, 2026, there are $185.4 million of short-term borrowings under the Credit Facility due in fiscal 2027.

Revolving Credit Facility

On November 30, 2023, the Company entered into the Credit Facility, which is scheduled to mature on November 30, 2028, with a group of lenders. The Credit Facility provides capacity of up to $550.0 million, to the extent secured by eligible accounts receivable and inventory balances at period end, which consist primarily of U.S. dollar denominated account balances. At May 31, 2026 and May 31, 2025, there were $185.4 million and $149.2 million, respectively, of outstanding borrowings drawn against the Credit Facility. After accounting for the eligible borrowing base, at May 31, 2026 and May 31, 2025, availability under the Credit Facility was $219.5 million and $260.9 million, respectively. Amounts drawn under the Credit Facility accrue interest at rates equal to an applicable margin over the one-, three-, or six-month term Secured Overnight Financing Rate (“SOFR Rate”), plus a SOFR adjustment. The Company incurred approximately $2.7 million of issuance costs, of which $2.5 million will be amortized to interest expense over the expected five-year Credit Facility term and are reflected in other assets.

The Credit Facility permits borrowings under two types of borrowing mechanisms: (1) Term SOFR Rate Loans and (2) a swing loan. The Term SOFR Rate Loans permit the Company to draw a specific principal amount for a defined maturity of up to six months with the interest rate determined at the time of the draw, which equals an applicable margin over the applicable term SOFR Rate plus a SOFR adjustment. Each Term SOFR Rate Loan has an individual, unique identifier and is distinguishable from the other Term SOFR Rate Loan drawn by the Company. At the end of each relevant interest period, the Company has the option to continue the same interest period for such Term SOFR Rate Loan or it may request a conversion to a new interest period for such Term SOFR Rate Loan. If no notice is given by the Company, the Term SOFR Rate Loan is deemed to continue with the same interest period.

The swing loan permits the Company to draw on the Credit Facility at any time up to a maximum of the greater of (1) $55 million and (2) 10% of the then-maximum amount of the Credit Facility. The swing loan interest rate is variable based upon the interest rate market. As of May 31, 2026 and May 31, 2025, the swing loan rate was 7.25% and 8.0%, respectively. Any amounts drawn on the swing loan mature on the same date as the maturity of the Credit Facility; however, it has been the practice of the Company to repay the outstanding draws on the swing loan within a short-term period.

The Credit Facility is secured by a first priority lien (subject to permitted liens and certain other exceptions) on certain working capital assets of the Company and the guarantors, including accounts and inventory, but excluding intellectual property, real property and equity interests, and subject to customary exceptions.

On January 15, 2026, the Company amended the Credit Facility when it entered into the Second Amendment to the Company’s Revolving Credit and Security Agreement (“Second Amendment to the Credit Facility”). The Second Amendment to the Credit Facility, among other things, permitted the Company to consummate the Offer. The Company incurred immaterial costs associated with the amendment. For additional information, see “Note 2 – Acquisitions”.

As of May 31, 2026, the Company had no material contractual or regulatory restrictions on the payment of dividends provided that no event of default exists under the Credit Facility and it meets the minimum availability threshold thereunder. As of May 31, 2026, the Company was in compliance with the financial covenants of the Credit Facility.

As of May 31, 2026, and May 31, 2025, the weighted average interest rate on the outstanding interest-bearing debt under the Credit Facility was 5.22% and 5.98%, respectively.

Subsequent to May 31, 2026, the Company replaced the Credit Facility. For additional information, see “Note 21 – Subsequent Events”.

Long-Term Debt

Canadian Government Regional Economic Growth Loan

On December 17, 2024, Tempel Canada entered into an agreement with the Federal Economic Development Agency for Southern Ontario, Canada, through the Canadian Government’s Regional Economic Growth Innovation program, which provided a 0% interest loan of up to CAD $3.5 million (approximately USD $2.5 million as of May 31, 2026) to be used for the purchase and installation of advanced manufacturing equipment at Tempel Canada’s Burlington, Ontario location. The first distribution to Tempel Canada was received in the third quarter of fiscal 2025 in the amount of CAD $3.2 million (approximately USD $2.2 million), or 90% of the total available through the program. The remaining 10% is expected to be received upon project completion. The FED DEV Loan is scheduled to be paid off in sixty equal installments beginning April 1, 2027, with the final payment due March 1, 2032. There were no debt issuance costs associated with the loan.

As of May 31, 2026 and May 31, 2025, the amount outstanding under the FED DEV Loan was $2.3 million and $2.3 million, respectively.

Business Development Bank of Canada Canadian Loan

On March 25, 2025, Tempel Canada entered into the BDC Letter with BDC. Pursuant to the terms of the BDC Letter, BDC has committed to lend Tempel Canada up to CAD $57.5 million (approximately USD $41.7 million as of May 31, 2026), subject to the satisfaction of customary closing conditions and deliverables. The purpose of the BDC Loan is to fund the construction of a new manufacturing facility to be located in Burlington, Ontario, Canada.

The BDC Loan is structured as a construction draw loan. As extended in fiscal 2026, the draw period for the BDC Loan was set to lapse on June 30, 2026, unless further extended by BDC. Subsequent to May 31, 2026, the draw period was extended until August 31, 2026. Monthly interest only payments will be due until July 1, 2026, at which point the BDC Loan will also be subject to monthly amortization payments until maturity. The BDC Loan will accrue interest (1) during the construction period, at a per annum rate equal to BDC’s Floating Base Rate minus 1.75%, and (2) at all times thereafter, at a per annum rate equal to BDC’s Floating Base Rate minus 1.75% or BDC’s Base Rate minus 1.75%, at Tempel Canada’s election. The BDC Loan matures on June 1, 2051.

Worthington Steel guarantees the payment obligations of Tempel Canada in respect of the BDC Loan. As amended in fiscal 2026, the guarantee is for the full amount of the BDC Loan on the date of any demand. Provided that there has never been a breach of certain default conditions, the guarantee is reduced to 50% of the outstanding BDC Loan balance once the principal amount outstanding is less than CAD $40.0 million (approximately USD $29.0 million as of May 31, 2026), subject to the satisfaction of certain conditions. The Company will also provide customary cost overrun and completion guarantees in respect of the construction of the Burlington Property. The obligations of Tempel Canada under the BDC Letter are secured by a mortgage on the Burlington Property, an assignment of rents relating to the Burlington Property, and a lien on certain equipment and other personal property located on or used in connection with the Burlington Property.

The BDC Loan contains representations, covenants and events of default customary for transactions of this nature, including that Tempel Canada will maintain a total debt to tangible equity ratio of 1.0 to 1.0 and a fixed charge coverage ratio of 1.15 to 1.0, each tested annually beginning May 31, 2026.

As of May 31, 2026, the amount outstanding under the BDC Loan was $36.4 million, while there were no amounts outstanding under the BDC Loan as of May 31, 2025.

Canadian Advanced Manufacturing and Innovation Competitiveness Loan

On May 12, 2025, Tempel Canada entered into an agreement with the Province of Ontario’s Minister of Economic Development, Job Creation and Trade for the AMIC Loan to support building and equipment expansion at the Burlington Property. The AMIC Loan provided a loan for up to CAD $5.0 million (approximately USD $3.6 million as of May 31, 2026) During fiscal 2026, the Company received total distributions of CAD $2.5 million (approximately USD $1.8 million as of May 31, 2026). The remaining amount of the loan is expected to be received in steps as project spending progresses. The AMIC Loan is interest free until June 1, 2028, at which point it will bear interest at a fixed rate of 5.97% per annum with interest due annually. The AMIC Loan is scheduled to be paid off in four equal annual installments beginning June 30, 2029, with the final payment due June 30, 2032. The AMIC Loan is structured with an incentive component that states up to CAD $0.5 million (approximately USD $0.4 million as of May 31, 2026) of the principal may be forgiven if certain performance targets are met. The Company will continue to recognize the full liability until such time as the conditions for forgiveness are satisfied. There were no debt issuance costs associated with the AMIC Loan.

As of May 31, 2026, the amount outstanding under the AMIC Loan was $1.8 million, while there were no amounts outstanding under the AMIC Loan as of May 31, 2025.

Sitem Group

The Company assumed the liabilities of Sitem Group as part of the acquisition and recorded the Sitem Group liabilities within the Company’s consolidated balance sheets. The Sitem Group’s obligations include various Euro-denominated term loans, which have varying maturities, interest rates, interest rate mechanisms, and have periodic payments due until maturity. The obligations, along with the relevant loan terms, are included in the summary table within this footnote. Sitem Group was in compliance with its financial covenants as of May 31, 2026.

During fiscal 2026, Sitem Group fully repaid four of its loan agreements totaling €12.4 million (approximately USD $14.3 million at the time of payment) prior to maturity with cash on hand. Upon repayment of one of the loan agreements, the associated interest rate swap was terminated. For additional information, see “Note 16 – Derivative Financial Instruments and Hedging Activities”. Additionally, during fiscal 2026, a fifth loan was fully repaid at the scheduled maturity date.

Standstill Agreement – Sitem Group

Sitem Group, through its subsidiary Stanzwerk AG, entered into the Standstill Agreement with UBS Switzerland AG, as agent and a syndicate of lenders in April 2025. The agreement relates to bilateral credit facilities originally provided to Stanzwerk AG in the aggregate principal amount of CHF 17.1 million (approximately USD $21.7 million as of May 31, 2026). Under the terms of the Standstill Agreement, the lenders agreed to maintain availability under the credit lines through June 30, 2026, and to forbear from exercising termination, enforcement, or acceleration rights with respect to scheduled repayments or collateral during the standstill period, subject to customary extraordinary termination rights upon events of default.

The Standstill Agreement provides for continued use of the facilities solely for loan advances and requires pro rata utilization of the credit lines across participating lenders. Borrowings bear interest at the applicable reference rate (which is based on the Swiss Average Rate Overnight and has a floor of zero) plus a 500-basis point margin, with an additional 0.25% quarterly commission on overdraft balances.

The Standstill Agreement contains financial covenants requiring Stanzwerk AG to maintain (1) a minimum equity ratio of 15%, tested quarterly beginning June 30, 2025, and (2) minimum liquidity of CHF 4.0 million (approximately USD $5.1 million as of May 31, 2026), tested monthly beginning April 30, 2025. Stanzwerk AG was in compliance with these covenants as of May 31, 2026.

Subsequent to May 31, 2026, Stanzwerk AG entered into an Amended and Restated Standstill Agreement with UBS Switzerland AG maintaining the credit facility through August 31, 2028. See “Note 21 – Subsequent Events” for additional information regarding the amended terms.

Term Loan Facility with the Former Parent

On June 8, 2021, TWB entered into a $50.0 million term loan agreement (the “TWB Term Loan”) with a subsidiary of the Former Parent that matured in annual installments through May 31, 2024. The proceeds were used by TWB to finance the Shiloh U.S. BlankLight purchase price in June 2021. This note accrued interest at a rate of 5.0% per annum. The borrowings were the legal obligation of TWB. As such, the debt and related interest have been attributed to the Company in the consolidated and combined financial statements prior to the Separation.

The Former Parent’s note receivable associated with the TWB Term Loan was contributed to the Company in connection with the Separation on December 1, 2023. As a result, the TWB Term Loan balance was eliminated in consolidation following the Separation.

Other Debt

Other – Debt Financing Commitment

In connection with and concurrently with the entry into the Offer for the Kloeckner Acquisition, the Company obtained debt financing commitments (“Bridge Nonrevolving Loan Commitment”) in an aggregate amount not to exceed $1.9 billion from a group of lenders, with Wells Fargo Bank, National Association, as administrative agent, to support the expected permanent financing.

In connection with the Bridge Nonrevolving Loan Commitment, the Company incurred approximately $17.8 million of fees and costs, which were initially capitalized in prepaid expenses and other current assets, and were left unamortized until funding (in whole or in part) or until the commitment expires or is no longer applicable. As of May 31, 2026, approximately $14.8 million of the fees remained accrued and were yet to be paid. Excluding any ongoing commitment fees, the Company will pay the substantial balance of those fees once the Bridge Nonrevolving Loan Commitment has been terminated, the Kloeckner Acquisition has closed, or the amounts available under the Bridge Nonrevolving Loan Commitment remain undrawn upon expiration.

During May 2026, the Company announced that it had priced an offering (the “Offering”) of the 2033 Notes. Accordingly, as of May 31, 2026, the Company determined it was not probable that the Bridge Nonrevolving Loan Commitment would be drawn upon given the permanent financing had been priced, which resulted in the immediate expensing of the previously capitalized cost. The Company recorded the costs to interest expense, net for the fiscal year ended May 31, 2026. After May 31, 2026, on June 1, 2026, the Company issued the 2033 Notes, which eliminated its ability to draw on the Bridge Nonrevolving Loan Commitment. For additional information, see “Note 2 – Acquisitions”.

Other – Tempel China

Tempel owns a subsidiary in China, Tempel China, which utilizes multiple short-term loan facilities, which are used to finance raw material purchases, and are collateralized by Tempel China property and equipment. There were no borrowings outstanding under the facilities at May 31, 2026, and May 31, 2025.

As of May 31, 2026, Tempel China has two active facilities, for an aggregate facility size of CNY 90.0 million (approximately USD $13.3 million and $12.5 million as of May 31, 2026, and May 31, 2025, respectively). The first facility is for CNY 40.0 million (approximately USD $5.9 million as of May 31, 2026) and matures on September 10, 2026. The second facility is for CNY 50.0 million (approximately USD $7.4 million as of May 31, 2026) and matures on July 29, 2026. The maturity of the second facility was extended after fiscal 2026, with the facility now scheduled to mature on July 27, 2027.

Other – Tempel India

Tempel owns a subsidiary in India (“Tempel India”) which has two individual credit facilities with separate financial institutions, each of which contains a line of credit and standby letters of credit/letters of guarantee secured by applicable Tempel India current assets and fixed assets. The facilities are subject to annual renewals, which are effective as of the date of the annual renewal letter.

The aggregate size of the Tempel India credit facilities is INR 1,150.0 million (approximately USD $12.1 million and USD $14.0 million as of May 31, 2026 and May 31, 2025, respectively), subject to adjustment pursuant to the security noted above. One credit facility is for INR 500.0 million (approximately USD $5.3 million as of May 31, 2026) and matures on January 7, 2027. The other credit facility is for INR 650.0 million (approximately USD $6.8 million as of May 31, 2026) and matures on December 15, 2026.

Both the credit facilities allow for borrowing on the lines of credit up to a sublimit of the total facility size, which was equal to an aggregate of INR 550.0 million (approximately USD $5.8 million and USD $7.0 million, as of May 31, 2026, and May 31, 2025, respectively). Interest is payable monthly and will accrue on the outstanding balance according to the lender’s base lending rate plus an applicable margin as determined by the lender. As of May 31, 2026, and May 31, 2025, there were no borrowings outstanding under Tempel India line of credit facilities.

Letters of credit may be drawn against the aggregate limit of these credit facilities, excluding any amounts drawn by the lines of credit. As of May 31, 2026, and May 31, 2025, no amounts under the Tempel India credit facilities were due to the financial institutions. The purchases, made in the normal course of business that are supported by the letters of credit, are recorded in accounts payable in the consolidated balance sheets as of May 31, 2026, and May 31, 2025.

Other – Sitem Slovakia

Tempel owns a majority interest in a subsidiary in Slovakia (“Sitem Slovakia”), and Sitem Slovakia has an overdraft line of credit in the amount of €0.3 million (approximately USD $0.4 million as of May 31, 2026), which is secured by Sitem Slovakia’s trade receivables. The overdraft line of credit matures in February 2027, and is reviewed annually for renewal. Outstanding borrowings carry an interest rate of one-month Euribor plus 1.75%. There were no borrowings outstanding under the facility as of May 31, 2026.

Accounts Receivable Securitization

On June 29, 2023, the Company terminated the revolving trade accounts receivable securitization facility (the “AR Facility”) because it was no longer needed. No early termination or other similar fees or penalties were paid in connection with the termination of the AR Facility.