Summary
This 8-K filing from American Express (AXP) on July 25, 2013, announces an amendment to the Senior Executive Severance Plan, effective for agreements signed on or after September 1, 2013. The key change introduces a pro-rated annual incentive award (AIA) for eligible executives in the year their severance begins. This pro-rated AIA will be paid out according to the normal bonus schedule, typically in the first quarter of the following year. The calculation of the pro-rated AIA will be based on the executive's most recently paid bonus. Notably, for senior executives (Band 95 and above) whose bonuses are tied to the Incentive Compensation Plan, this pro-rated amount may also be subject to reduction at the Compensation and Benefits Committee's discretion, depending on the Company's overall performance. This amendment clarifies and potentially enhances severance benefits for a specific group of executives.
Key Highlights
- 1American Express amended its Senior Executive Severance Plan, effective September 1, 2013.
- 2The amendment introduces a pro-rated annual incentive award (AIA) for executives commencing severance.
- 3The pro-rated AIA will cover the period of active employment during the severance year.
- 4Payment of the pro-rated AIA will occur at the standard bonus payout time, typically Q1 of the following year.
- 5The pro-rated AIA is calculated based on the executive's most recent bonus payment.
- 6For Band 95 and above executives, the pro-rated bonus may be reduced based on company performance, at the committee's discretion.