CP executing on clear plan to achieve low 70s Operating Ratio as quickly and efficiently as possible

(Source: Canadian Pacific Railway press release, January 9, 2012)

CALGARY, Alberta — On January 9, Canadian Pacific sent a letter to its shareholders from John Cleghorn, Chairman of the Board of Directors. Highlights of the letter include:

• CP has a Multi-Year Plan verified and endorsed by the Board of Directors to drive volume growth, expand the network and control costs

• Board fully supports CEO and management team

• Pershing Square advocating change in management, but has not presented any detailed, credible plan

• Pershing Square does not fully take into account structural differences between CP and peers as well as rising annual pension costs associated with CP’s legacy pension plans

• Pershing Square suggests unrealistic operating ratio reduction at pace never before achieved by any railway management team

• Board open to views of shareholders and encourages Mr. Ackman to accept offer to join CP Board and participate with full knowledge of the facts in execution of CP’s Multi-Year Plan

The full text of the letter is on the CP Rail website.