Note 8 – Debt

Foreign currency-denominated borrowings are translated at the applicable reporting period exchange rates, with translation adjustments recorded in accumulated other comprehensive income (loss) (“AOCI”).

As of August 31, 2026, there were $541.6 million of short-term borrowings and current maturities of long-term debt due in the next year.

Short-Term Borrowings

Revolving Credit Facility

On June 25, 2026, the Company entered into an asset-based revolving credit agreement (the “2031 Revolving Credit Facility”) which refinanced and replaced its previous revolving credit facility. The 2031 Revolving Credit Facility provides capacity of up to $550.0 million subject to borrowing base availability and other conditions, and matures on June 25, 2031. At August 31, 2026 there were no outstanding borrowings drawn against the 2031 Revolving Credit Facility. After accounting for the eligible borrowing base, at August 31, 2026 availability under the 2031 Revolving Credit Facility was $418.4 million. The facility also provides for swingline loans and letters of credit. The Company incurred approximately $4.4 million of issuance costs which will be amortized to interest expense over the expected five-year term of the facility.

Borrowings under the 2031 Revolving Credit Facility bear interest, at the Company’s option, at a per annum rate equal to (A) (i) the base rate equal to the greatest of: (a) the prime rate, (b) the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System plus 0.50% and (c) 1-month term Secured Overnight Financing Rate (“SOFR”) plus 1.0%, subject to a floor of 1%, plus (ii) an applicable rate of 0.250% or 0.375% which fluctuates based on the average excess availability under the 2031 Revolving Credit Facility; or (B) 1, 3 or 6-month term SOFR or Daily Simple SOFR, subject to a floor of 0%, plus an applicable rate of 1.250% or 1.375% which fluctuates based on the average excess availability under the 2031 Revolving Credit Facility.

The 2031 Revolving Credit Facility is secured by a lien on substantially all of the assets of the Company and the guarantors, subject to permitted liens and certain other exceptions. The Company currently has no material contractual or regulatory restrictions on the payment of dividends under the 2031 Revolving Credit Facility, subject to compliance with the applicable conditions and limitations thereunder. As of August 31, 2026, the Company was in compliance with applicable covenants of the 2031 Revolving Credit Facility.

Prior Credit Facility

The Company’s prior senior secured revolving credit facility (the “2028 Revolving Credit Facility”) provided capacity of up to $550.0 million and was scheduled to mature on November 30, 2028. The 2028 Revolving Credit Facility was terminated and fully repaid on June 25, 2026 in connection with the Company’s entry into the 2031 Revolving Credit Facility.

At May 31, 2026, there was $185.4 million of outstanding borrowings drawn against the 2028 Revolving Credit Facility. After accounting for the eligible borrowing base, at May 31, 2026, availability under the 2028 Revolving Credit Facility was $219.5 million. Individual amounts drawn under the 2028 Revolving Credit Facility accrued interest at rates equal to an applicable margin over the one-, three-, or six-month term SOFR Rate, plus a SOFR adjustment. The Company incurred approximately $2.7 million of issuance costs in connection with the 2028 Revolving Credit Facility, of which $1.3 million remained unamortized at the time of its termination and were recognized in interest expense upon termination. As of May 31, 2026, the weighted average interest rate on the outstanding interest-bearing debt under the 2028 Revolving Credit Facility was 5.22%.

Kloeckner Short-term Debt

The Company assumed the liabilities of Kloeckner as part of the acquisition and recorded Kloeckner’s liabilities within the Company’s consolidated balance sheet. Kloeckner’s short-term obligations included various loans discussed below. Kloeckner was in compliance with its financial covenants as of August 31, 2026.

ABS Germany Program

Kloeckner maintains an asset-backed securitization program in Europe (the “ABS Germany Program”) under which eligible trade receivables originated by certain subsidiaries are sold to a securitization vehicle and financed through arrangements with Commerzbank. The program has been amended and extended from time to time and currently provides capacity of up to €60.0 million (approximately USD $69.7 million as of August 31, 2026). The ABS Germany Program matures on July 25, 2028 and provides the company with funds for refinancing of trade receivables. At August 31, 2026 there was €41.0 million (approximately USD $47.7 million as of August 31, 2026) of outstanding borrowings drawn against the ABS Germany Program. After accounting for the eligible borrowing base, availability under the ABS Germany Program was €2.6 million ($3.2 million) as of August 31, 2026.

Borrowings under the ABS Germany Program bear interest at EURIBOR plus a margin of 1.30% per annum. As of August 31, 2026, the weighted average interest rate on the outstanding interest-bearing debt under the program was 3.65%. The ABS Germany Program contains customary termination provisions, including certain receivables performance thresholds related to dilution, delinquency and default ratios, and includes financial covenants that, to the extent applicable, are consistent with those under the German RCF.

ABL USA

On November 16, 2020, Kloeckner, through its subsidiary Kloeckner Metals Corporation, entered into an asset-based lending credit agreement (the “ABL USA Facility”) with Bank of America, N.A. as administrative agent and collateral agent. During 2022, the facility was amended to increase the facility capacity to $650.0 million, and to extend the maturity to July 14, 2027. The ABL USA Facility is secured by a continuing lien on all personal property of each obligor under the facility, including, among other things, a lien on stock issued by the borrowers and certain subsidiaries, inventories and accounts receivable. At August 31, 2026, there were $465.0 million of outstanding borrowings drawn against the ABL USA Facility. After accounting for the eligible borrowing base and outstanding letters of credit, availability under the ABL USA Facility was $138.5 million as of August 31, 2026.

The ABL USA Facility includes base rate loans and term SOFR loans. Base rate loans bear interest at a base rate in effect from time to time plus a margin of up to 0.50%. Term SOFR loans bear interest at a rate per annum equal to term SOFR for the relevant interest period plus a margin of up to 1.50%. As of August 31, 2026, the weighted average interest rate on the outstanding interest-bearing debt under the facility was 5.17%.

Austria Bank Loans

Kloeckner, through its subsidiary Kloeckner Metals Austria GmbH & Co KG, maintains bilateral term loans (the “Austria Bank Loans”) with Oberbank AG. At August 31, 2026, the Austria Bank Loans were fully drawn with an aggregate outstanding balance of €15.7 million (approximately USD $18.2 million as of August 31, 2026). The loans have varying maturities ranging from September 2026 through December 2026. Borrowings under the Austria Bank Loans bear interest at a rate between 2.45% and 3.67%. As of August 31, 2026, the weighted average interest rate on the outstanding interest-bearing debt under the facility was 2.93%.

Long-Term Debt

Business Development Bank of Canada Canadian Loan

On March 25, 2025, Tempel Canada entered into a letter of offer (“BDC Letter”) with Business Development Bank of Canada (“BDC”). Pursuant to the terms of the BDC Letter, BDC committed to lend Tempel Canada up to CAD $57.5 million (approximately USD $41.2 million as of August 31, 2026) (“BDC Loan”), 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 (“Burlington Property”).

The BDC Loan is structured as a construction draw loan. The loan was fully drawn as of August 31, 2026. Monthly interest only payments were due until July 1, 2026, at which point the BDC Loan was also subject to monthly amortization payments until maturity. The BDC Loan will accrue interest 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 during the first quarter of fiscal 2026, the guarantee is for the full outstanding 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 $28.9 million as of August 31, 2026), subject to the satisfaction of certain conditions. 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 August 31, 2026, the amount outstanding under the BDC Loan was $41.2 million, while the amount as of May 31, 2026 was $36.4 million.

Other Canadian Government Loans

Tempel Canada has entered into two interest-free loan arrangements with Canadian federal and provincial government agencies to support advanced manufacturing equipment purchases and facility expansion at its Burlington Property. These arrangements provide for aggregate funding commitments of up to CAD $8.5 million (approximately USD $6.1 million as of August 31, 2026), of which approximately USD $4.3 million and USD $4.1 million were outstanding as of August 31, 2026 and May 31, 2026, respectively. Additional funding is expected to be received as project milestones and eligible expenditures are completed.

The loans require repayment in various installments beginning in 2027 through 2032. One of the loan arrangements bears no interest until June 1, 2028, after which it accrues interest at a fixed rate of 5.97%. Certain amounts under this loan may be eligible for forgiveness upon achievement of specified performance targets; however, the Company will continue to recognize the full liability until the applicable forgiveness conditions are satisfied. No debt issuance costs were incurred in connection with these loan arrangements.

2033 Senior Notes

On June 1, 2026, the Company issued $700.0 million aggregate principal amount 7.75% senior secured notes due June 1, 2033 (the “2033 Senior Notes”). Interest on the 2033 Senior Notes is payable semi-annually on June 1 and December 1 of each year, beginning December 1, 2026. The 2033 Senior Notes and related guarantees are secured by liens on substantially all of the assets of the Company and the subsidiary guarantors, subject to certain exceptions, permitted liens and intercreditor arrangements. The indenture governing the 2033 Senior Notes contains customary restrictive covenants that, subject to specified exceptions, limit the Company's ability to incur additional indebtedness, create liens, make restricted payments and investments, dispose of assets and enter into certain other transactions. Certain permitted transactions are subject to incurrence-based financial tests. The Company was in compliance with the applicable covenants as of August 31, 2026. The net proceeds were used to fund a portion of the cash consideration for the Kloeckner Acquisition. The Company incurred approximately $13.0 million of debt issuance costs related to the offering, which are presented as a direct deduction from the carrying amount of the debt and are being amortized to interest expense over the term of the notes using the effective interest method.

Term Loan Facility

On June 1, 2026, the Company entered into a $700.0 million aggregate principal amount seven-year term loan facility due June 1, 2033 (the “Term Loan Facility”). The Term Loan Facility bears interest, at the Company’s option, at a rate per annum equal to Term SOFR plus 4.00%, Daily Simple SOFR plus 4.00%, or the base rate plus 3.00%. The Term Loan Facility is secured by liens on substantially all of the assets of the Company and its wholly owned material subsidiaries that are guarantors, subject to certain exceptions, permitted liens and intercreditor arrangements. The Term Loan Facility contains customary affirmative and negative covenants, including restrictions on indebtedness, liens, investments, restricted payments, asset dispositions and certain other transactions. The Term Loan Facility does not contain a financial maintenance covenant, although certain permitted transactions are subject to incurrence-based financial tests. The Company was in compliance with the applicable covenants as of August 31, 2026. The net proceeds were used to fund a portion of the cash consideration for the Kloeckner Acquisition. The Company incurred approximately $21.6 million of debt issuance costs related to the offering, which are presented as a direct deduction from the carrying amount of the debt and are being amortized to interest expense over the term of the Term Loan Facility using the effective interest method.

Under the terms of the Term Loan Facility, the Company may voluntarily prepay outstanding borrowings, in whole or in part, at any time without premium or penalty, subject to customary notice requirements. On August 19, 2026, the Company made a $200.0 million voluntary principal repayment, reducing the outstanding principal balance. Following the repayment, $500.0 million was outstanding under the Term Loan Facility as of August 31, 2026.

Kloeckner Long-term Debt

The Company assumed the liabilities of Kloeckner as part of the acquisition and recorded Kloeckner’s liabilities within the Company’s consolidated balance sheet. Kloeckner’s obligations included various long-term loans discussed below. Kloeckner was in compliance with its financial covenants as of August 31, 2026.

German Syndicated Revolving Credit Facility

On May 23, 2013, Kloeckner entered into a syndicated revolving credit facility agreement (the “German RCF”) with Commerzbank Aktiengesellschaft as agent. On May 8, 2026, Kloeckner entered into a fifth amendment and restatement agreement which reduced commitments under the facility to €150.0 million (approximately USD $174.3 million as of August 31, 2026). The German RCF also permits ancillary facilities (including overdraft, guarantee, bonding, documentary or stand-by letter of credit, derivatives and foreign exchange facilities) in an aggregate amount of up to €50.0 million. The German RCF matures on June 3, 2028 and provides the company with funds for general corporate purposes. At August 31, 2026 there was €110.1 million (approximately USD $127.9 million as of August 31, 2026) of outstanding borrowings drawn against the German RCF. After accounting for the eligible borrowing base, availability under the German RCF was €39.9 million ($46.4 million) as of August 31, 2026.

Borrowings under the German RCF bear interest at a rate per annum equal to EURIBOR for the relevant interest period (subject to a 0.00% floor) plus a margin of 3.50%. Kloeckner is required to pay a commitment fee of 1.225% per annum on each lender’s undrawn commitments, payable quarterly in arrears.

The German RCF contains financial covenants requiring Kloeckner to maintain (i) a gearing ratio, defined as consolidated net debt to consolidated equity, of no more than 1.50x, (ii) consolidated equity of at least €500.0 million and (iii) compliance with a borrowing

base, which would require that outstanding loans and other applicable amounts may not exceed a borrowing base determined principally by reference to eligible receivables and inventory, net of certain priority obligations. A breach of the gearing ratio or minimum consolidated equity covenant, or a borrowing base shortfall, may result in a mandatory prepayment obligation.

Swiss Syndicated Revolving Credit Facility

On January 7, 2025, Kloeckner, through its subsidiary Debrunner Koenig AG, entered into an unsecured syndicated loan agreement (the “Swiss RCF”) with Zürcher Kantonalbank as agent. The Swiss RCF provides capacity of up to CHF 200.0 million (approximately USD $247.4 million as of August 31, 2026) and matures on January 7, 2029. The facility is available in CHF and EUR (up to €50.0 million) and provides Kloeckner with funds for general corporate purposes. At August 31, 2026 there was CHF 155.0 million (approximately USD $191.8 million as of August 31, 2026) of outstanding borrowings drawn against the Swiss RCF. After accounting for the eligible borrowing base, availability under the Swiss RCF was CHF 45.0 million ($55.7 million) as of August 31, 2026.

Borrowings under the Swiss RCF bear interest at a rate per annum equal to compounded SARON for CHF and EURIBOR for EUR for the relevant interest period plus a margin of up to 3.30% depending on the net leverage ratio of the Swiss subgroup.

ABL Mexico

On September 4, 2024, Kloeckner, through its subsidiary Kloeckner Metals Service Centers De Mexico, S. De R.L. De C.V., entered into an asset-based lending credit agreement (the “ABL Mexico Facility”) with Banco Santander México, S.A. as
administrative agent and collateral agent. The ABL Mexico Facility provides capacity of up to $115.0 million and matures on September 4, 2027. The ABL Mexico Facility is secured by inventories and accounts receivable. At August 31, 2026 there was $112.0 million of outstanding borrowings drawn against the ABL Mexico Facility. After accounting for the eligible borrowing base, availability under the ABL Mexico Facility was $3.0 million as of August 31, 2026.

Borrowings under the ABL Mexico Facility bear interest at a rate per annum equal to Term SOFR for the relevant interest period plus a margin of up to 2.45% depending on the leverage ratio of the Mexican subgroup.

Subsequent to August 31, 2026, the Company amended its ABL Mexico Facility. For additional information, see “Note 19 – Subsequent Events”.

Term Loans – Sitem Group

Sitem Group’s obligations include various secured and unsecured Euro-denominated term loans with maturities ranging from September 2026 through September 2030. At August 31, 2026, there was an aggregate amount of €6.9 million (approximately USD $8.0 million as of August 31, 2026) of borrowing outstanding under the term loans. Borrowings under the term loans bear interest at varying rates, including fixed interest rates ranging from 0.36% to 1.94%, and variable interest rates ranging from Euribor 3m/360 + 1.20% to Euribor 3m/360 + 1.65%. The term loans have periodic payments due until maturity. During the first quarter of fiscal 2027, one loan was fully repaid at the expected maturity date. Sitem Group was in compliance with its financial covenants as of August 31, 2026.

Standstill Agreement – Sitem Group

In April 2025, Sitem Group, through its subsidiary Stanzwerk AG, entered into a standstill agreement (the "Standstill Agreement") with UBS Switzerland AG, as agent, and a syndicate of lenders, relating to bilateral credit facilities originally provided to Stanzwerk AG in the aggregate principal amount of CHF 17.1 million (approximately USD $21.1 million as of August 31, 2026).

On June 29, 2026, the parties entered into an Amended and Restated Standstill Agreement, which extended the availability of the bilateral credit facilities through August 31, 2028, subject to customary events of default and other termination provisions. The amended agreement also requires principal repayments of CHF 6.0 million (approximately USD $7.4 million as of August 31, 2026) on June 30, 2026 and CHF 4.0 million (approximately USD $4.9 million as of August 31, 2026) on December 31, 2026, followed by quarterly principal repayments equal to the greater of CHF 0.2 million (approximately USD $0.2 million as of August 31, 2026) or 25% of operating cash flow. After making the required principal repayment on June 30, 2026, the remaining principal outstanding as of August 31, 2026 amounted to CHF 11.1 million (approximately USD $13.7 million as of August 31, 2026).

The Standstill Agreement provides for the continued use of the facilities solely for loan advances and requires pro rata utilization of the credit lines across participating lenders. Borrowings continue to bear interest at the applicable reference rate, based on the Swiss Average Rate Overnight ("SARON"), subject to a zero floor, plus a 500-basis point margin through December 31, 2026, decreasing to a 400-basis point margin beginning January 1, 2027. The agreement also provides for a 0.25% quarterly commission on overdraft balances.

The Amended and Restated Standstill Agreement contains financial covenants requiring Stanzwerk AG to maintain (i) a minimum equity ratio of 15%, tested quarterly, and (ii) minimum liquidity of CHF 4.0 million (approximately USD $4.9 million as of August 31, 2026) through December 31, 2026, decreasing to CHF 2.0 million (approximately USD $2.5 million as of August 31, 2026) thereafter. Stanzwerk AG was in compliance with these covenants as of August 31, 2026.

Other Debt

The Company, through certain foreign subsidiaries, maintained short-term credit facilities and overdraft agreements with an aggregate borrowing capacity of $25.9 million and $25.8 million at August 31, 2026 and May 31, 2026, respectively. None of the Company’s foreign subsidiaries had outstanding borrowings under these agreements as of August 31, 2026 or May 31, 2026.