Summary
Norfolk Southern Corporation (NSC) announced on January 23, 2008, the establishment of a commercial paper program allowing the company to issue unsecured commercial paper notes up to an aggregate amount of $1 billion. This program is designed for general corporate purposes, including funding working capital, capital expenditures, acquisitions, and share repurchases. The ability to reborrow under the program provides financial flexibility. J.P. Morgan Securities Inc. and Goldman, Sachs & Co. have been appointed as dealers for this program. The notes can have maturities of up to 397 days and will bear interest at agreed-upon rates, potentially tied to various benchmark rates such as LIBOR or the federal funds rate. This filing indicates a proactive step by NSC to ensure access to short-term funding, which can be important for managing ongoing operations and strategic initiatives.
Key Highlights
- 1Establishment of a $1 billion commercial paper program for short-term debt issuance.
- 2Proceeds from the program are earmarked for general corporate purposes, including working capital, capital expenditures, acquisitions, and share repurchases.
- 3The company can reborrow amounts available under the program, offering financial flexibility.
- 4J.P. Morgan Securities Inc. and Goldman, Sachs & Co. will serve as dealers for the commercial paper notes.
- 5Notes can mature up to 397 days from issuance.
- 6Interest rates on notes can be fixed or floating, with potential benchmarks including CD rate, commercial paper rate, federal funds rate, LIBOR, prime rate, and treasury rate.
- 7The program includes standard events of default with potential cure periods.