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CANADIAN PACIFIC KANSAS CITY LTD/CN 8-K Report, Material Agreement (May 17, 2023)

Reports
Material Agreements·Exhibits & Filings
Filing Date
Filed May 17, 2023
Period End
May 11, 2023
Security
CP
In the record · 2016–202610-K2010-Q328-K361

CP filed 20 annual reports (10-K), 32 quarterly reports (10-Q) and 361 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Jun ’17Jun ’17
  2. Material agreement8-K · Oct ’19Oct ’19
  3. Leadership change8-K · Feb ’22Feb ’22
  4. Leadership change8-K · Jul ’26Jul ’26

01—Abstract

Summary

Summary of the 8-K filed May 17, 2023. Cited figures are marked; the original filing is the authoritative source.

Canadian Pacific Kansas City Limited (CP) announced a significant update to its credit facilities through a Second Amended and Restated Credit Agreement, effective May 11, 2023.

This amendment substantially increases the aggregate borrowing capacity and extends the maturity dates of its existing credit lines. Specifically, the total commitments have been raised from $1.3 billion to $2.2 billiona, providing the company with enhanced financial flexibility. Furthermore, the maturity dates for both the 5-year and 2-year facilities have been extended, pushing out near-term repayment obligations and aligning debt maturities with longer-term strategic horizons.

This move by CP is a proactive step to bolster its financial position, particularly in light of its recent merger and ongoing integration efforts. The increased credit line provides a larger cushion for operational needs, potential investments, and unforeseen circumstances.

The extended maturities offer greater certainty regarding debt servicing and reduce immediate refinancing risk. Investors should view this as a positive development that strengthens CP's financial resilience and supports its growth initiatives following the significant acquisition.

02—Key points

Key Highlights

  1. CP has entered into a Second Amended and Restated Credit Agreement, effective May 11, 2023.
  2. The aggregate commitments under the credit agreement have been increased from $1.3 billion to $2.2 billion.
  3. The maturity date for the 5-year facility has been extended from September 27, 2026, to May 11, 2028.
  4. The maturity date for the 2-year facility has been extended from September 27, 2023, to May 11, 2025.
  5. This amendment provides enhanced financial flexibility and liquidity for Canadian Pacific Railway Company, a subsidiary of CP.
  6. The agreement was entered into with Bank of Montreal as the administrative agent and various lenders.

03—Questions

Frequently Asked Questions

  1. What is the main purpose of the Second Amended and Restated Credit Agreement?

    The main purpose is to increase the company's borrowing capacity and extend the maturity dates of its existing credit facilities, thereby enhancing financial flexibility and reducing near-term refinancing risk.

  2. How much has CP's credit capacity increased?

    CP's aggregate commitments under the credit agreement have been increased from $1.3 billion to $2.2 billion, representing an increase of $900 million.

  3. When are the new maturity dates for the credit facilities?

    The 5-year facility's maturity date has been extended to May 11, 2028, and the 2-year facility's maturity date has been extended to May 11, 2025.

  4. Who are the key parties involved in this credit agreement?

    The agreement involves Canadian Pacific Railway Company as the borrower, Canadian Pacific Kansas City Limited as the covenantor, Bank of Montreal as the administrative agent, and various lenders.

04—Continue

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