Long-term Debt and Other Financing

9 Months Ended

Sep. 30, 2011

In April 2011, AK Steel entered into a five-year, $1.0 billion asset-backed revolving credit facility (“Credit Facility”) with a group of lenders. The Credit Facility, which is secured by most of the Company’s product inventory and accounts receivable, replaced AK Steel’s prior $850.0 asset-backed credit facility (“Replaced Credit Facility”), which was set to expire in February 2012 and was secured by the same classes of assets as the Credit Facility. In October 2011, AK Steel exercised a portion of the “accordion” feature of its Credit Facility, obtaining an additional $100.0 in credit commitments from lenders and increasing its total credit limit under the Credit Facility to $1.1 billion. The increase was made pursuant to the terms of the Credit Facility and all terms and conditions of the Credit Facility remain the same as those in effect prior to the increase. As a result of the higher credit limit, certain availability thresholds with respect to the covenants under the Credit Facility increased proportionally with the increase in the credit limit.

The Credit Facility contains restrictions similar to the Replaced Credit Facility, including limitations on, among other things, distributions and dividends, acquisitions and investments, indebtedness, liens and affiliate transactions. The restrictions in the Credit Facility only apply in the event that the Company’s availability under the Credit Facility falls below certain specific thresholds, none of which exceed $247.5. Availability is calculated as the lesser of the Credit Facility commitment or the Company’s eligible collateral after advance rates, less outstanding revolver borrowings and letters of credit. Availability under the Credit Facility can fluctuate monthly based on the varying levels of eligible collateral. In addition, the Credit Facility requires maintenance of a minimum fixed charge coverage ratio of one to one if availability under the Credit Facility is less than $137.5. As of September 30, 2011, there were outstanding borrowings of $295.0 under the $1.0 billion Credit Facility and availability was further reduced by $155.0 attributable to outstanding letters of credit, resulting in remaining availability of $550.0. AK Holding is the sole guarantor of the Credit Facility.

During the period, the Company was in compliance with all the terms and conditions of its debt agreements.