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): May 18, 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 2.05 Costs Associated with Exit or Disposal Activities
In April 2009, American Express Company (the
"Company") announced its intention to undertake a new
companywide reengineering initiative in the second quarter
of 2009 to help further reduce its operating costs in light
of the uncertain economic outlook. On May 18, 2009, the
Company's management committed to undertake various
reengineering activities within its business units and staff
groups that are expected to result in a restructuring charge
in the second quarter of 2009 of approximately $180 million
to $250 million pre-tax ($117 million to $163 million after
tax). The reengineering activities are expected to result in
the elimination of approximately 4,000 jobs, which
constitutes approximately 6% of the Company's worldwide
workforce. The total expected charge includes approximately
$175 million to $210 million in employee severance
obligations and other employee-related costs and
approximately $5 million to $40 million in other costs
principally relating to the termination of certain real
property leases and other contracts. The reengineering
activities relate principally to downsizing and reorganizing
certain operations due to a contraction of some of the
Company's businesses. Substantially all of the reengineering
activities are expected to be completed by the end of 2009,
with the remainder expected to be completed by the first
half of 2010. The Company estimates that all of the
severance and employee-related costs and a significant
majority of the other costs will result in future cash
expenditures.
Item 7.01 Regulation FD Disclosure
In addition to the restructuring charge described
above, the Company announced that it anticipates that the
reengineering activities associated with the
staffing-related portion of the charge will result in a cost
benefit to the Company of approximately $175 million after
all the initiatives to be undertaken in 2009 have been
completed. Also, in addition to staff reductions, the
Company announced that it was undertaking further
reengineering initiatives, including a reduction of
investment spending in marketing and business development
and a reduction in other operating costs relating to
expenses for consulting and other professional services,
travel and general overhead, all of which are expected to
result in an additional cost benefit of approximately $625
million in the aggregate.
The aggregate benefits of $800 million described
above, which are expected to be realized during the
remainder of 2009, represent a reduction from previously
planned 2009 spending levels and are in addition to the
benefits tied to the reengineering plan announced in October
2008.
A copy of the Company's press release announcing the
reengineering activities describe above is furnished as
Exhibit 99.1 to this Current Report on Form 8-K and is
incorporated herein by reference.
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Exhibit
99.1 Press release, dated May 18, 2009, of American Express
Company announcing reengineering initiative.
Forward-Looking Statements
This report includes forward-looking statements,
which are subject to risks and uncertainties.
Forward-looking statements contain words such as "believe,"
"expect," "anticipate," "optimistic," "intend," "plan,"
"aim," "will," "may," "should," "could," "would," "likely"
and similar expressions. Readers are cautioned not to place
undue reliance on these forward-looking statements, which
speak only as of the date on which they are made. The
Company undertakes no obligation to update or revise any
forward-looking statements. Factors that could cause actual
results to differ materially from these forward-looking
statements include, but are not limited to, the following:
the Company's ability to generate earnings and continue to
stay profitable, which will depend in part on cardmember
spending and credit performance, the success of the
Company's reengineering initiatives and the severity of the
economic environment; the success, timeliness and financial
impact (including costs, cost savings, and other benefits,
including increased revenues), and beneficial effect on the
Company's operating expense to revenue ratio, both in the
short-term (including during the remainder of 2009) and over
time, of reengineering initiatives being implemented or
considered by the Company, including cost management,
structural and strategic measures such as vendor (including,
among others, consulting and other professional services),
process, facilities and operations consolidation,
outsourcing (including, among others, technologies
operations), relocating certain functions to lower-cost
overseas locations, moving internal and external functions
to the internet to save costs and travel and other general
operating costs, and planned staff reductions relating to
certain of such reengineering actions; the Company's ability
to reinvest the benefits arising from such reengineering
actions in its businesses; and the actual amount to be spent
by the Company on technology and marketing, promotion,
rewards and cardmember services based on management's
assessment of competitive opportunities and other factors
affecting its judgment. A further description of these and
other risks and uncertainties can be found in the Company's
Annual Report on Form 10-K for the year ended December 31,
2008, its Quarterly Report on Form 10-Q for the three months
ended March 31, 2009, and the Company's other reports filed
with the SEC.
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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
(REGISTRANT)
By: /S/ CAROL V. SCHWARTZ
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Name: Carol V. Schwartz
Title: Secretary
Date: May 19, 2009
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EXHIBIT INDEX
ITEM NO. DESCRIPTION
99.1 Press release, dated May 18, 2009, of American Express Company
announcing restructuring charge.
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