September 07, 2008

WCI Steel amends its credit agreement with Harbinger Capital

WCI Steel Inc announced that the company had entered into an agreement to modify its existing USD 150 million credit facility with Harbinger Capital Partners Master Fund I Ltd, replacing the current bank group.

With this amendment, certain advance limitations under the agreement will be waived until July 31st 2008, and the company will be able to fully utilize its current USD 150 million facility in the near term. The initial borrowing under the facility will carry an interest rate of LIBOR plus 5%. The interest rate on each borrowing in excess of collateral valuations equals 15% and subsequent to March 31st 2008, the interest rate on each advance in excess of collateral valuations increases at the rate of 0.2% each week.

Mr Leonard M Anthony president & CEO of WCI Steel said that "We appreciate the support of our largest shareholder to improve the financial position of WCI Steel. This amendment provides the company with substantial additional liquidity and the necessary flexibility as we return to full operations after the November fire at the blast furnace hydraulic control rooms and rebuild our working capital."

Mr Anthony added that "We are also pleased to report that the new walking beam furnace in the hot strip mill is operational. Although we still have challenges ahead of us, I am confident that with the increased liquidity, the support of Harbinger and working together with our customers, suppliers and employees, we can successfully implement solutions to the challenges facing WCI Steel. With the assistance provided by the amended financing, we will be able to ensure a brighter future for WCI Steel."