Summary
This 8-K filing from American Express Company (AXP) on March 2, 2015, details the issuance of 850,000 Depositary Shares, each representing a 1/1,000th interest in a Series C Preferred Share. This transaction represents a modification to the company's capital structure and introduces a new class of preferred stock, the 4.900% Fixed Rate / Floating Rate Non-Cumulative Perpetual Preferred Shares, Series C. Investors should note that the terms of these Series C Preferred Shares impose certain restrictions on the company's ability to pay dividends or make distributions on its common stock and other parity preferred shares if dividends on the Series C Preferred Shares are not paid in full. The sale of these Depositary Shares closed on March 2, 2015, pursuant to an underwriting agreement. This issuance and the associated terms are designed to enhance American Express's capital flexibility. The filing also includes the Certificate of Amendment to the company's Restated Certificate of Incorporation, the Deposit Agreement, and an opinion from legal counsel regarding the legality of the new securities.
Key Highlights
- 1American Express issued 850,000 Depositary Shares representing interests in Series C Preferred Shares.
- 2The Series C Preferred Shares are perpetual, non-cumulative, and have a fixed/floating rate dividend structure of 4.900%.
- 3The issuance represents a material modification to the rights of security holders due to new dividend restrictions.
- 4If dividends on Series C Preferred Shares are not paid, American Express faces restrictions on paying dividends or making distributions on common stock and parity preferred shares.
- 5The sale of Depositary Shares closed on March 2, 2015, under an underwriting agreement.
- 6The Series C Preferred Shares have a liquidation preference of $1,000,000 per share.
- 7This filing details amendments to the company's Certificate of Incorporation to establish the Series C Preferred Shares.