UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 7, 2009
AMERICAN EXPRESS COMPANY
(Exact name of registrant as specified in its charter)
New York 1-7657 13-4922250
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation Identification No.)
or organization)
200 Vesey Street, World Financial Center
New York, New York 10285
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 640-2000
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement.
Pursuant to a Letter Agreement, dated January 9, 2009, and the
Securities Purchase Agreement -- Standard Terms attached thereto (together,
the "Securities Purchase Agreement"), American Express Company (the "Company")
issued and sold to the United States Department of the Treasury (the "Treasury
Department"): (i) 3,388,890 shares of the Company's Fixed Rate Cumulative
Perpetual Preferred Stock, Series A, par value $1.66 2/3 per share (the
"Series A Preferred Stock"), having a liquidation preference per share equal
to $1,000 and (ii) a ten-year warrant (the "Warrant") to purchase up to
24,264,129 shares of the Company's common shares at an initial per share
exercise price of $20.95 per share, for an aggregate purchase price of
$3,388,890,000 (the "Purchase Price").
The Series A Preferred Stock pays cumulative dividends at a rate of
5% per year for the first five years and thereafter at a rate of 9% per year.
The Company may not redeem the Series A Preferred Stock during the first three
years except with the proceeds from one or more "Qualified Equity Offerings"
(as defined in the Certificate of Amendment of the Certificate of
Incorporation of the Company (the "Certificate of Amendment")). After three
years, the Company may, at its option, redeem the Series A Preferred Stock.
Any redemption will be at the liquidation preference plus accrued and unpaid
dividends. The Series A Preferred Stock is generally non-voting.
Prior to January 9, 2012, unless the Company has redeemed the Series
A Preferred Stock or the Treasury Department has transferred the Series A
Preferred Stock to a third party, the consent of the Treasury Department will
be required for the Company to (1) declare or pay any dividend or make any
distribution on its common shares (other than regular quarterly cash dividends
of not more than $0.18 per share of common shares) or (2) redeem, purchase or
acquire any shares of its common shares or other equity or capital securities,
other than in connection with benefit plans consistent with past practice and
certain other circumstances specified in the Securities Purchase Agreement. In
addition, under the Certificate of Amendment, the Company's ability to declare
or pay dividends or repurchase its common shares or other equity or capital
securities will be subject to restrictions in the event that it fails to
declare and pay (or set aside for payment) full dividends on the Series A
Preferred Stock.
The Warrant provides for the adjustment of the exercise price and the
number of shares of the Company's common shares issuable upon exercise
pursuant to customary anti-dilution provisions, such as upon stock splits or
distributions of securities or other assets to holders of the Company's common
shares, and upon certain issuances of the Company's common shares at or below
a specified price relative to the then current market price of the Company's
common shares. If, on or prior to December 31, 2009, the Company receives
aggregate gross cash proceeds of not less than the Purchase Price from one or
more Qualified Equity Offerings, the number of shares of common shares
issuable pursuant to the Treasury Department's exercise of the Warrant will be
reduced by one-half of the original number of shares, taking into account all
adjustments, underlying the Warrant. Pursuant to the Securities Purchase
Agreement, the Treasury Department has agreed not to exercise voting power
with respect to any shares of common shares issued upon exercise of the
Warrant (the "Warrant Shares").
Both the Series A Preferred Stock and the Warrant will be accounted
for as components of Tier 1 capital.
The Series A Preferred Stock and the Warrant were issued in a private
placement exempt from registration pursuant to Section 4(2) of the Securities
Act of 1933, as amended. The Company has granted certain registration and
offering facilitation rights to the Treasury Department for the Series A
Preferred Stock, the Warrant and the Warrant Shares. Neither the Series A
Preferred Stock, the Warrant nor the Warrant Shares will be subject to any
contractual restrictions on transfer and the Warrant is immediately
exercisable upon its issuance, except that the Treasury Department may not
transfer or exercise one-half of the Warrant prior to the earlier of the date
on which the Company receives aggregate gross cash proceeds of not less than
the Purchase Price from one or more Qualified Equity Offerings and December
31, 2009.
Pursuant to the Securities Purchase Agreement, the Company agreed to
certain restrictions on executive compensation that could limit the tax
deductibility of compensation the Company pays to certain executives until
such time as the Treasury Department ceases to own any securities acquired
pursuant to the Securities Purchase Agreement. The Company also agreed that,
for such time period, it will take all necessary action to ensure that its
benefit plans with respect to its senior executive officers comply with
Section 111(b) of the Emergency Economic Stabilization Act of 2008 ("EESA") as
implemented by any guidance or regulation thereunder that has been issued and
is in effect as of the date of issuance of the Series A Preferred Stock and
the Warrant and not adopt any benefit plans with respect to, or that cover,
the Company's senior executive officers that do not comply with EESA. The
applicable executives have delivered to the Treasury waivers of any claims they
may have against the United States and the Company for any changes to their
respective compensation and benefit terms resulting from the Company's
compliance with the foregoing.
The Certificate of Amendment, Warrant and Securities Purchase
Agreement are attached hereto as Exhibits 3.1, 4.1 and 10.1, respectively, and
are incorporated herein by reference. In addition, the descriptions of the
Certificate of Amendment, Warrant and Securities Purchase Agreement contained
herein are qualified in their entirety by reference to the applicable exhibit
to this Report on Form 8-K.
Item 3.02 Unregistered Sales of Equity Securities.
The information set forth under "Item 1.01 Entry into a Material
Definitive Agreement" is incorporated by reference into this Item 3.02.
Item 3.03 Material Modification to Rights of Security Holders.
The information concerning restrictions on the Company's ability to
declare or pay dividends and to redeem, purchase or acquire its common shares
or other equity or capital securities under "Item 1.01 Entry into a Material
Definitive Agreement" is incorporated by reference into this Item 3.03.
Item 5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
The information concerning executive compensation set forth under
"Item 1.01 Entry into a Material Definitive Agreement" is incorporated by
reference into this Item 5.02.
Item 5.03 Amendment to Articles of Incorporation or Bylaws; Change in
Fiscal Year.
On January 7, 2009, the Company filed with the Secretary of State of
the State of New York a Certificate of Amendment to its Restated Certificate
of Incorporation establishing the terms of the Series A Preferred Stock. This
Certificate of Amendment is attached as Exhibit 3.1 hereto and is incorporated
herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
The following exhibits are filed herewith:
EXHIBIT NO. DESCRIPTION OF EXHIBIT
3.1 Certificate of Amendment of the Certificate of Incorporation
for the Series A Preferred Stock
4.1 Warrant to Purchase Common Stock
10.1 Letter Agreement, dated January 9, 2009, between
American Express Company and the United States
Department of the Treasury, which includes the
Securities Purchase Agreement-Standard Terms
attached thereto, with respect to the issuance and
sale of the Series A Preferred Stock and the
Warrant
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
AMERICAN EXPRESS COMPANY
By: /S/ STEPHEN P. NORMAN
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Name: Stephen P. Norman
Title: Secretary
Date: January 9, 2009
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION OF EXHIBIT
3.1 Certificate of Amendment of the Certificate of Incorporation for
the Series A Preferred Stock
4.1 Warrant to Purchase Common Stock
10.1 Letter Agreement, dated January 9, 2009, between
American Express Company and the United States
Department of the Treasury, which includes the
Securities Purchase Agreement-Standard Terms
attached thereto, with respect to the issuance and
sale of the Series A Preferred Stock and the
Warrant