Exhibit 10.39

AMERICAN EXPRESS COMPANY

2007 INCENTIVE COMPENSATION PLAN

PORTFOLIO GRANT 20        -20        

TO

 

          

Name of Employee

 

                      Award Date     Expiration Date of the Award Period

 

    $    

Total Target Value

We are pleased to inform you that, pursuant to the Company’s 2007 Incentive
Compensation Plan, as amended (the “Plan”), the Compensation and Benefits
Committee (the “Committee”) of the Board of Directors (the “Board”) of American
Express Company (the “Company”), made an award of a portfolio grant to you as
hereinafter set forth (the “Award”) under the Plan as of the award date
specified above (the “Award Date”). The Award is subject to the Detrimental
Conduct Provisions established by the Committee, and as from time to time
amended.

1. General. You have been granted the Award subject to the provisions of the
Plan and the terms, conditions and restrictions set forth in this agreement
(this “Agreement”). The Total Target Value of the Award consists of the Target
Values of four components: the Target Value of the Average Annual EPS Incentive
Component (the “Average Annual EPS Target Value”), which shall equal         %
of the Total Target Value; the Target Value of the Average Annual Net Revenue
Incentive Component (the “Average Annual Net Revenue Target Value”), which shall
equal         % of the Total Target Value; the Target Value of the Average
Annual ROE Incentive Component (the “Average Annual ROE Target Value”), which
shall equal         % of the Total Target Value; and the Target Value of the
Relative Total Shareholder Return Incentive Component (the “Relative TSR Target
Value”), which shall equal         % of the Total Target Value. The period
beginning                     , 20         and ending on the expiration date
specified above (the “Expiration Date”) is the “Award Period.” The Total Target
Value, or any of its components, may be reduced by the Committee in its sole
discretion, which may include but need not be limited to, situations where on
the last day of the Award Period you are engaged in Related Employment, as that
term is defined in the Plan. The Schedule A Value (as that term is defined
below), if any, of each component will be determined as specified in Paragraph
3.

2. Requirement of Employment. Except as otherwise provided in Paragraphs 4
and 6, your rights to the Cash Value and the Number of Restricted Shares or
Restricted Stock Units (as those terms are defined below) under Paragraph 5
shall be provisional and shall be canceled in whole or in part, as determined by
the Committee in its sole discretion if your continuous employment with the
Company and its Affiliates (as that term is defined in the Plan)

--------------------------------------------------------------------------------

or your Related Employment (as that term is defined in the Plan) (hereinafter
collectively referred to as “employment with the American Express companies”),
terminates for any reason on or before the Payment Date set forth in Paragraph
5. Whether and as of what date your employment with the American Express
companies shall terminate if you are granted a leave of absence or commence any
other break in employment intended by your employer to be temporary, shall be
determined by the Committee in its sole discretion.

3. Determination of the Schedule A Values, Initial Value, Final Value, Cash
Value and the Number of Restricted Shares or Restricted Stock Units.

(a) Except as otherwise provided in this Paragraph 3 and in Paragraphs 2, 4 and
6, there shall be paid to you in accordance with Paragraph 5, the sum, as may be
adjusted by the Committee pursuant to Subparagraph 3(i), of:

(i) the Schedule A Value of the Average Annual EPS Incentive Component (the
“Average Annual EPS Schedule A Value”) as of the last day of the Award Period,
as provided in Subparagraph 3(b);

(ii) the Schedule A Value of the Average Annual Net Revenue Incentive Component
(the “Average Annual Net Revenue Schedule A Value”) as of the last day of the
Award Period, as provided in Subparagraph 3(c);

(iii) the Schedule A Value of the Average Annual ROE Incentive Component (the
“Average Annual ROE Schedule A Value”) as of the last day of the Award Period,
as provided in Subparagraph 3(d); and

(iv) the Schedule A Value of the Relative Total Shareholder Return Incentive
Component (the “Relative TSR Schedule A Value”) as of the last day of the Award
Period, as provided in Subparagraph 3(e).

(b) Average Annual EPS Schedule A Value. Except as otherwise provided in this
Paragraph 3, the Average Annual EPS Schedule A Value as of the last day of the
Award Period will be equal to (Xb) times (Yb), where (Xb) equals the Average
Annual EPS Incentive Payout Percentage, if any, determined by the Committee in
its sole discretion based on the Average Annual EPS (as that term is defined
below) of the Company or of a unit of the Company, as the case may be, pursuant
to the formula provided in Schedule A to this Agreement, and where (Yb) is the
Average Annual EPS Target Value. However, in no event will the Average Annual
EPS Schedule A Value be greater than the Maximum Average Annual EPS Value, which
equals the maximum Average Annual EPS Incentive Payout Percentage set forth in
Schedule A to this Agreement, times the Average Annual EPS Target Value.

(c) Average Annual Net Revenue Schedule A Value. Except as otherwise provided in
this Paragraph 3, the Average Annual Net Revenue Schedule A Value as of the last
day of the Award Period will be equal to (Xc) times (Yc), where (Xc) equals the
Average Annual Net Revenue Incentive Payout Percentage, if any, determined by
the Committee in its sole discretion based on the Average Annual Net Revenue (as
that term is defined below) of the Company or of a unit of the Company, as the
case may be, pursuant to the formula provided in Schedule A to this Agreement,
and where (Yc) is the Average Annual Net Revenue Target

 

2

--------------------------------------------------------------------------------

Value. However, in no event will the Average Annual Net Revenue Schedule A Value
be greater than the Maximum Average Annual Net Revenue Value, which equals the
maximum Average Annual Net Revenue Incentive Payout Percentage set forth in
Schedule A to this Agreement, times the Average Annual Net Revenue Target Value.

(d) Average Annual ROE Schedule A Value. Except as otherwise provided in this
Paragraph 3, the Average Annual ROE Schedule A Value as of the last day of the
Award Period will be equal to (Xd) times (Yd), where (Xd) equals the Average
Annual ROE Incentive Payout Percentage, if any, determined by the Committee in
its sole discretion based on the Average Annual ROE (as that term is defined
below) of the Company or of a unit of the Company, as the case may be, pursuant
to the formula provided in Schedule A to this Agreement, and where (Yd) is the
Average Annual ROE Target Value. However, in no event will the Average Annual
ROE Schedule A Value be greater than the Maximum Average Annual ROE Value, which
equals the maximum Average Annual ROE Incentive Payout Percentage set forth in
Schedule A to this Agreement, times the Average Annual ROE Target Value.

(e) Relative TSR Schedule A Value. Except as otherwise provided in this
Paragraph 3, the Relative TSR Schedule A Value as of the last day of the Award
Period will be equal to (Xe) times (Ye), where (Xe) equals the Relative TSR
Incentive Payout Percentage, if any, determined by the Committee in its sole
discretion based on a comparison of the Amex TSR and the S&P 500 TSR, pursuant
to the formula provided in Schedule A to this Agreement, and where (Ye) is the
Relative TSR Target Value. However, in no event will the Relative TSR Schedule A
Value be greater than the Maximum TSR Value, which equals the maximum Relative
TSR Incentive Payout Percentage set forth in Schedule A to this Agreement, times
the Relative TSR Target Value.

(f) Calculation. In the application of Schedule A to this Agreement after the
end of the Award Period for purposes of determining the Schedule A Values
pursuant to Subparagraphs 3(b), (c), (d) and (e):

(i) if the Average Annual EPS is less than the level needed to have some Average
Annual EPS Schedule A Value, there shall be no Average Annual EPS Schedule A
Value; and if the Average Annual EPS is equal to or greater than the level to
have some Average Annual EPS Schedule A Value, but less than or equal to the
maximum level, and the Average Annual EPS actually attained is not represented
in the table set forth on Schedule A, then the Average Annual EPS Schedule A
Value shall be determined by straight-line interpolation from the amounts
specified in such table immediately less than and greater than the Average
Annual EPS actually attained;

(ii) if the Average Annual Net Revenue is less than the level needed to have
some Average Annual Net Revenue Schedule A Value, there shall be no Average
Annual Net Revenue Schedule A Value; and if the Average Annual Net Revenue is
equal to or greater than the level to have some Average Annual Net Revenue
Schedule A Value, but less than or equal to the maximum level, and the Average
Annual Net Revenue actually attained is not represented in the table set forth
on Schedule A, then the Average Annual Net Revenue Schedule A Value shall be
determined by straight-line interpolation from the amounts specified in such
table immediately less than and greater than the Average Annual Net Revenue
actually attained;

 

3

--------------------------------------------------------------------------------

(iii) if the Average Annual ROE is less than the level needed to have some
Average Annual ROE Schedule A Value, there shall be no Average Annual ROE
Schedule A Value; and if the Average Annual ROE is equal to or greater than the
level to have some Average Annual ROE Schedule A Value, but less than or equal
to the maximum level, and the Average Annual ROE actually attained is not
represented in the table set forth on Schedule A, then the Average Annual ROE
Schedule A Value shall be determined by straight-line interpolation from the
amounts specified in such table immediately less than and greater than the
Average Annual ROE actually attained; and

(iv) if the difference between the Amex TSR and the S&P 500 TSR is less than the
level needed to have some Relative TSR Schedule A Value, there shall be no
Relative TSR Schedule A Value; and if the difference between the Amex TSR and
the S&P 500 TSR is equal to or greater than the level to have some Relative TSR
Schedule A Value, but less than or equal to the maximum level, and the actual
difference between the Amex TSR and the S&P 500 TSR is not represented in the
table set forth on Schedule A, then the Relative TSR Schedule A Value shall be
determined by straight-line interpolation from the amounts specified in such
table immediately less than and greater than the actual difference between the
Amex TSR and the S&P 500 TSR.

(g) Definitions. For purposes of this Award, the following terms shall have the
following meanings (which will take into account, in each case, the expenses and
other financial effect for the applicable year(s) of portfolio grants under the
Plan except as adjusted by the application of Subparagraphs 3(h) and 3(i)).

(i) “Net Revenue” means, for any given year, the total managed revenue net of
interest expense of the Company or of a segment or other part of the Company, as
the case may be, for such year, as reported by the Company.

(ii) “Average Annual Net Revenue” means, for the Award Period, the sum of the
Net Revenue for every year during the Award Period, divided by 3.

(iii) “Net Income” means, for any given year, the after-tax net income (or loss)
of the Company or of a segment or other part of the Company, as the case may be,
for such year, as reported by the Company and as adjusted below. The calculation
of Net Income for any given year will be adjusted to exclude:

 

  •  

reported cumulative effect of accounting changes;

 

  •  

reported income and losses from discontinued operations; and

 

  •  

reported extraordinary gains and losses as determined under generally accepted
accounting principles.

(iv) “Earnings Per Share” means, for any given year, the diluted earnings (or
loss) per share of the Company for such year, as determined by the Company. The
calculation of Earnings Per Share, for any given year, will be adjusted in the
same fashion as Net Income for such year.

 

4

--------------------------------------------------------------------------------

(v) “Average Annual EPS” means, for the Award Period, the sum of the Earnings
Per Share for every year during the Award Period, divided by 3.

(vi) “Annual Return on Equity” means, for any given year, the Net Income for
such year divided by the Average Annual Shareholders’ Equity for such year.

(vii) “Average Annual ROE” means, for the Award Period, the sum of the Annual
Return on Equity for every year in the Award Period, divided by 3.

(viii) “Average Annual Shareholders’ Equity” means, for any given year, the sum
of the total shareholders’ equity of the Company or of a segment or other part
of the Company, as the case may be, as of the first day of such year and as of
the end of each month during such year (each as reported by the Company),
divided by 13.

(ix) “Annual ROE” means, for any given year, the Net Income for such year
divided by the Average Annual Shareholders’ Equity for such year.

(x) “Amex Total Shareholder Return” or “Amex TSR” means the compounded annual
growth rate, expressed as a percentage with one decimal point, in the value of a
share of common stock in the Company due to stock appreciation and dividends,
assuming dividends are reinvested, during the Award Period. For this purpose,
the “Beginning Stock Price” shall mean the average closing sales prices of the
Company’s common stock on the New York Stock Exchange Composite Transaction Tape
for the trading days in the month of                      immediately preceding
the beginning of the Award Period; and, the “Ending Stock Price” shall mean the
average closing sales prices of the Company’s common stock on the New York Stock
Exchange Composite Transaction Tape for the trading days in the month of
                     immediately preceding the Expiration Date. Where “Y” is the
number of fractional Shares resulting from the deemed reinvestment of dividends
paid during the Award Period, the Amex TSR is calculated as follows:

 

(  

Ending Stock Price x (1 + Y)

Beginning Stock Price

  )   1/3    -1

(xi) “S&P 500 Total Shareholder Return” or “S&P 500 TSR” means the compounded
annual growth rate, expressed as a percentage with one decimal point, in the
value of the S&P 500 Index during the Award Period, as determined from
information publicly reported by Standard & Poors Company (or the entity that
publishes such other index, as the case may be).

(h) To the extent permissible for purposes of Section 162(m) of the Internal
Revenue Code of 1986, as amended (the “Code”), in the event of any change in the
corporate capitalization of the Company, such as by reason of any stock split,
or a material corporate transaction, such as any merger of the Company into
another corporation, any consolidation of the Company and one or more
corporations into another corporation, any separation of the Company (including
a spin-off or other distribution of stock or property by the Company), any
reorganization of the Company (whether or not such reorganization comes within
the definition of such term in Section 368 of the Code), or any partial or
complete liquidation by the Company, other than a normal cash dividend, if the
Committee shall determine that such a change equitably

 

5

--------------------------------------------------------------------------------

requires an adjustment in the calculation or terms of the Average Annual ROE,
the Average Annual Net Revenue, the Average Annual EPS or the Relative Total
Shareholder Return Incentive Component under this Award, on the grounds that any
such change would produce an unreasonable value, such equitable adjustment will
be made by the Committee. Any such determination by the Committee under this
Subparagraph 3(h) shall be final, binding and conclusive.

(i) As soon as practicable after the last day of the Award Period, the Committee
may determine, in its sole discretion, that the sum of the Schedule A Values (as
initially determined in Subparagraphs 3(b), (c), (d) and (e)) may be adjusted
downward (that is, to a value of zero), but in no event upward, as follows:

(i) Your Unit’s Results. Downward by a percentage (ranging from 0-100%) of such
initially determined sum, based on such criteria as the Committee shall deem
appropriate relating to your unit’s results, with such resultant sum being the
“Initial Value”; provided that any such determination by the Committee need not
be made in a uniform manner and may be made selectively among holders of awards
of portfolio grants in your unit, whether or not such award holders are
similarly situated.

(ii) Your Individual Results. The Initial Value may be adjusted further downward
by a percentage (ranging from 0-100%) of such Initial Value after the
application of Subparagraph 3(i)(i), based on such criteria as the Committee
shall deem appropriate relating to your individual results, with such resultant
sum being the “Final Value” (except as otherwise provided by Paragraph 8);
provided that any such determination by the Committee need not be made in a
uniform manner and may be made selectively among holders of awards of portfolio
grants, whether or not such award holders are similarly situated.

(j) In no event may the Committee amend any provision hereof so as to increase
or otherwise adjust upward the Schedule A Value of any component.

(k) Subject to the limitations set forth in Paragraph 8, the Committee shall
determine the Schedule A Values, the Initial Value and the Final Value pursuant
to this Agreement, and such determinations by the Committee shall be final,
binding and conclusive upon you and all persons claiming under or through you.

(l) The Committee shall determine in its own discretion what portion of the
Final Value, if any, shall be payable in cash (the “Cash Value”), and what
portion shall be denominated in Restricted Shares or Restricted Stock Units of
the Company (the “RSA” or the “RSU”), in accordance with Paragraph 5 below. The
RSA or the RSU shall have the terms substantially as set forth in the form of
Restricted Share or Restricted Stock Unit awards granted generally under the
Plan, or its successor, except that the RSA or the RSU shall (A) vest pursuant
to a period determined in the Committee’s discretion, except that such vesting
period shall not be less than one year from date of grant, and (B) be
forfeitable only if your employment with the American Express companies
terminates by reason of voluntary resignation or terminates for cause (that is,
violation of the Code of Conduct as in effect from time to time) prior to the
applicable vesting dates. The number of restricted shares or restricted stock
units of the Company comprising the RSA or the RSU (the “Number of Restricted
Shares” or the “Number

 

6

--------------------------------------------------------------------------------

of Restricted Stock Units”) shall be determined by dividing such portion of the
Final Value so designated by the Committee, if any, by the closing price of the
shares on the date that the Committee approves payout of the Award, and shall be
payable in the form of an RSA or an RSU in accordance with Paragraph 5 below.

4. Death, Disability or Retirement.

(a) Death or Disability. If, on or before the Payment Date set forth in
Subparagraph 5(b), but during a period when you have been in continuous
employment with the American Express companies since the Award Date, you
terminate your employment with the American Express companies by reason of
Disability at any time following the Award Date or you die at any time following
the Award Date, you will be entitled to a payment equal to the Final Value,
which for this purpose shall be calculated by applying the rate at which the
expense for the Award was being accrued for purposes of the Company’s annual
audited financial statement at the end of the last completed calendar quarter
prior to your Disability or death, as applicable. Such amount, if any, shall be
payable within 90 days from the date of your Disability or death (or such later
date permitted by Section 409A of the Code and the Treasury Regulations
promulgated and other official guidance issued thereunder), and unless otherwise
determined by the Committee, in cash, common shares of the Company, or other
property, or any combination thereof, and you and all others claiming under or
through you shall not be entitled to receive any other amounts under this Award.
For purposes of this Agreement, “Disability” means that you (x) are unable to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or can be expected to last for a continuous period of not less than 12
months, or (y) are, by reason of any medically determinable physical or mental
impairment which can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months, receiving income replacement
benefits for a period of not less than three months under an accident and health
plan covering employees of the Company. In making its determination, the
Committee shall be guided by the prevailing authorities applicable under Section
409A of the Code.

(b) Early Retirement. If, on or before the Payment Date set forth in
Subparagraph 5(b) but during a period when you have been in continuous
employment with the American Express companies since the Award Date, you
terminate your employment with the American Express companies by reason of Early
Retirement, and such event occurs more than one year after the Award Date, then
you generally will be entitled to a payment equal to the Final Value, which
shall be determined for this purpose after the last day of the Award Period in
the normal course in accordance with Paragraph 3. For purposes of this
Agreement, “Early Retirement” means that at the time of your termination of
employment with the American Express companies, you have ten or more years of
service with the American Express companies and you are age 55 or older, but
younger than age 62. Such amount, if any, shall be payable in cash or Restricted
Stock Units, as described in Subparagraph 3(l) above, or other property, or any
combination thereof, after the Award Period in accordance with Paragraphs 5 and
6, and you and all others claiming under or through you shall not be entitled to
receive any other amounts under this Award.

(c) Full Retirement. If, on or before the Payment Date set forth in Subparagraph
5(b) but during a period when you have been in continuous employment with the

 

7

--------------------------------------------------------------------------------

American Express companies since the Award Date, you terminate your employment
with the American Express companies by reason of Full Retirement, then you
generally will be entitled to a payment equal to the Final Value, which shall be
determined for this purpose after the last day of the Award Period in the normal
course in accordance with Paragraph 3. For purposes of this Agreement, “Full
Retirement” means that at the time of your termination of employment with the
American Express companies, you have ten or more years of service with the
American Express companies and you are age 62 or older. Such amount, if any,
shall be payable in cash or Restricted Stock Units, as described in Subparagraph
3(l) above, or other property, or any combination thereof, after the Award
Period in accordance with Paragraphs 5 and 6, and you and all others claiming
under or through you shall not be entitled to receive any other amounts under
this Award.

(d) Grandfathered Executives. If you are both (i) age 60 or older, but younger
than age 62, and (ii) you have ten or more years of service with the American
Express companies, both as of December 31, 2013, then notwithstanding the other
Subparagraphs of this Paragraph 4, if, on or before the Payment Date set forth
in Subparagraph 5(b) but during a period when you have been in continuous
employment with the American Express companies since the Award Date, you
terminate your employment with the American Express companies, and such event
occurs more than one year after the Award Date, then you generally will be
entitled to a payment equal to the sum of (i) the Final Value multiplied by a
fraction, the numerator of which is the number of full months which have elapsed
between the first day of the Award Period and the end of the month in which your
termination of employment occurs (not to exceed 36), and the denominator of
which is 36, and (ii) 50% of an amount equal to the Final Value less the amount
payable pursuant to Subparagraph 4(d)(i). The Final Value for this purpose shall
be determined after the last day of the Award Period in the normal course in
accordance with Paragraph 3. Such amount, if any, shall be payable in cash or
Restricted Stock Units, as described in Subparagraph 3(l) above, or other
property, or any combination thereof, after the Award Period in accordance with
Paragraphs 5 and 6, and you and all others claiming under or through you shall
not be entitled to receive any other amounts under this Award.

5. Payment of Award.

(a) As soon as practicable after the last day of the Award Period, or the
earlier date your continuous employment with American Express companies
terminates by reason of Disability or death in accordance with Paragraph 4, the
Committee shall determine whether the conditions of Paragraph 2, and Paragraph 3
or 4, have been met and, if so, shall ascertain the Final Value, the Cash Value
and the Number of Restricted Shares or the Number of Restricted Stock Units, if
any, for the Award Period, in accordance with Paragraph 3 or 4, as the case may
be.

(b) If the Committee determines that there is no Average Annual EPS Schedule A
Value, no Average Annual Net Revenue Schedule A Value, no Average Annual ROE
Schedule A Value and no Relative TSR Schedule A Value, then this Award will be
cancelled. If the Committee determines that there is some Average Annual EPS
Schedule A Value, Average Annual Net Revenue Schedule A Value, Average Annual
ROE Schedule A Value or Relative TSR Schedule A Value, however, the Cash Value
as determined pursuant to Paragraph 3 shall become payable to you in cash, and
the Number of Restricted Shares or the

 

8

--------------------------------------------------------------------------------

Number of Restricted Stock Units shall be issued to you in the form of a
Restricted Share or Restricted Stock Unit award under the Plan, or its successor
(except that the RSA or the RSU shall vest pursuant to a period determined in
the Committee’s discretion, and such vesting period shall not be less than one
year from date of grant), or other property, or any combination thereof, as soon
as practicable following                     , 20        , but in no event later
than 90 days thereafter (the “Payment Date”).

6. Other Termination of Employment.

(a) If you terminate your employment with the American Express companies and you
receive separation payments under a severance plan or arrangement of the
Company, then the Award shall continue to vest and become payable until the
earlier of (i) the date that you receive your last separation payment or (ii)
the date that you begin a new full-time position outside the Company (the
earlier of such dates, the “Forfeiture Date”). Except as otherwise provided by
Paragraph 4, if the Payment Date occurs after the Forfeiture Date, then the
Award will be cancelled and forfeited. If the Payment Date occurs before the
Forfeiture Date, then you shall be entitled to receive payment of the Final
Value, as determined by the Committee, and you shall be entitled to the Cash
Value and the Number of Restricted Shares or the Number of Restricted Stock
Units, if any, as the case may be, which shall be paid to you on the Payment
Date pursuant to Paragraph 5.

(b) If, after the last day of the Award Period and on or before the Payment
Date, but during a period when you have been in continuous employment with the
American Express companies since the Award Date, your employment with the
American Express companies terminates for any reason other than death,
Disability, Early Retirement or Full Retirement as set forth in Paragraph 4,
then except as otherwise provided by Subparagraph 6(a), you and all others
claiming under or through you shall not be entitled to receive any amounts under
this Award, except as otherwise determined by the Committee in its sole
discretion.

7. Deferral or Acceleration of Payment of Award. Any payments to be made under
this Award may be deferred or accelerated in such manner as the Committee shall
determine; provided, however, that any such deferral or acceleration must comply
with the applicable requirements of Section 409A of the Code. As to such a
deferral of payment, any amount paid in excess of the amount that was originally
payable to you under this Agreement will be based on a reasonable interest rate
as determined by the Committee, and as to such an acceleration of payment to you
under this Agreement, any amount so paid will be discounted to reasonably
reflect the time value of money as determined by the Committee.

8. Change in Control.

(a) Notwithstanding anything in this Agreement to the contrary (except for the
provision dealing with a limitation under Section 280G of the Code, and except
as otherwise provided by Paragraph 8(b) below), if there is a Change in Control
(as defined below) prior to the payment of the Award, your Final Value of the
Award determined under Section 3(i)(ii) of the Agreement may not be less than
the Total Target Value of the Award multiplied by the Average Payout Percentage
(as defined below).

 

9

--------------------------------------------------------------------------------

(b) Notwithstanding anything in this Agreement to the contrary (except for the
provision dealing with a limitation under Section 280G of the Code), if you have
not received payment under the Agreement and, within two years after the date of
a Change in Control (as defined below), you experience a separation from service
(as that term is defined for purposes of Section 409A of the Code) that would
otherwise entitle you to receive the payment of severance benefits under the
provisions of the severance plan that is in effect and in which you participate
as of the date of such Change in Control, then:

(i) you shall immediately be 100% vested in the Award;

(ii) the Final Value of the Award will equal the Total Target Value of the Award
multiplied by the Average Payout Percentage (as defined below), but prorated
based on (a) the total number of full and partial months of the Award Period
which have elapsed between                     , 20        , and the date of
such separation from service (not to exceed 36), divided by (b) the total number
of months in the Award Period; and

(iii) such value of the Award shall be paid to you in cash within five days
after the date of such separation from service.

(c) “Average Payout Percentage” means the average of the payout percentages for
you under the two portfolio grant awards that were paid by the Company
immediately preceding the date of such Change in Control; provided, however, if
you only received one portfolio grant award payment immediately preceding the
date of the Change of Control, then such payout percentage and the payout
percentage for your unit for the portfolio grant award that immediately preceded
the portfolio grant for which you received payment shall be used to determine
your Average Payout Percentage; and provided further, if you have not received
any portfolio grant award payment prior to the date of the Change in Control,
then your Average Payout Percentage shall be the average of the payout
percentages for your unit under the two portfolio grant awards that were paid by
the Company immediately preceding the date of such Change in Control. For
purposes of this Subparagraph 8(c), the payout percentage of the Portfolio Grant
2011-2013, if applicable, will be based solely on the payout percentage for the
final payment under such award and the interim payment after the first year of
the its Performance Period shall not be treated as a separate payment for
purposes of such determination.

(d) A “Change in Control” has that meaning as defined in American Express Senior
Executive Severance Plan, as amended from time to time.

(e) The Committee may not amend or delete this Paragraph 8 of this Agreement in
a manner that is detrimental to you, without your written consent.

9. Tax Withholding and Furnishing of Information. There shall be withheld from
any payment of cash or vesting of restricted shares or restricted stock units
under this Award, such amount, if any, as the Company and/or your employer
determines is required by law, including, but not limited to, U.S. federal,
state, local or foreign income, employment or other taxes incurred by reason of
making of the Award or of such payment. It shall be a condition to the
obligation of the Company to make payments under this Award that you (or those
claiming

 

10

--------------------------------------------------------------------------------

under or through you) promptly provide the Company and/or your employer with all
forms, documents or other information reasonably required by the Company and/or
your employer in connection with the Award.

10. Rights Not Assignable. Except as otherwise determined by the Committee in
its sole discretion, your rights and interests under the Award and the Plan may
not be sold, assigned, transferred, or otherwise disposed of, or made subject to
any encumbrance, pledge, hypothecation or charge of any nature, except that you
may designate a beneficiary pursuant to Paragraph 11. If you (or those claiming
under or through you) attempt to violate this Paragraph 10, such attempted
violation shall be null and void and without effect, and the Company’s
obligation to make any further payments to you (or those claiming under or
through you) hereunder shall terminate.

11. Beneficiary Designation. Subject to the provisions of the Plan, you may, by
completing a form acceptable to the Company and returning it to the Corporate
Secretary’s Office, at 200 Vesey Street, New York, New York 10285, name a
beneficiary or beneficiaries to receive any payment to which you may become
entitled under this Agreement in the event of your death. You may change your
beneficiary or beneficiaries from time to time by submitting a new form to the
Corporate Secretary’s Office at the same address. If you do not designate a
beneficiary, or if no designated beneficiary is living on the date any amount
becomes payable under this Agreement, such payment will be made to the legal
representatives of your estate, which will be deemed to be your designated
beneficiary under this Agreement.

12. Administration. Any action taken or decision made by the Company, the Board
or the Committee or its delegates arising out of or in connection with the
construction, administration, interpretation or effect of the Plan or this
Agreement shall lie within its sole and absolute discretion, as the case may be,
and shall be final, conclusive and binding upon you and all persons claiming
under or through you. By accepting this Award or other benefit under the Plan,
you and each person claiming under or through you shall be conclusively deemed
to have indicated acceptance and ratification of, and consent to, any action
taken or decision made under the Plan by the Company, the Board or the Committee
or its delegates.

13. Amendment. This Agreement may be amended or terminated by the Company, the
Board or the Committee at any time prior to a Change in Control of the Company.
For the avoidance of doubt, you have no legally binding right to payment under
this Award until such payment is made to you.

14. Change in Control Payments. This Paragraph shall apply in the event of
Change in Control.

(a) In the event that any payment or benefit received or to be received by you
hereunder in connection with a Change in Control or termination of your
employment (hereinafter referred to collectively as the “Payments”) will be
subject to the excise tax referred to in Section 4999 of the Code (the “Excise
Tax”), then the Payments shall be reduced to the extent necessary so that no
portion of the Payments is subject to the Excise Tax but only if (a) the net
amount of all Total Payments (as hereinafter defined), as so reduced (and after
subtracting the net amount of federal, state and local income and employment
taxes on such

 

11

--------------------------------------------------------------------------------

reduced Total Payments) is greater than or equal to (b) the net amount of such
Total Payments without any such reduction (but after subtracting the net amount
of federal, state and local income and employment taxes on such Total Payments
and the amount of Excise Tax to which you would be subject in respect of such
unreduced Total Payments; provided, however, that you may elect in writing to
have other components of your Total Payments reduced, to the extent permitted by
Section 409A of the Code, prior to any reduction in the Payments hereunder.

(b) For purposes of determining whether the Payments will be subject to the
Excise Tax, the amount of such Excise Tax and whether any Payments are to be
reduced hereunder: (A) all payments and benefits received or to be received by
you in connection with such Change in Control or the termination of your
employment, whether pursuant to the terms of this Plan or any other plan,
arrangement or agreement with the Company, any Person whose actions result in
such Change in Control, or any Person affiliated with the Company or such Person
(collectively, “Total Payments”) shall be treated as “parachute payments”
(within the meaning of Section 280G(b)(2) of the Code) unless, in the opinion of
the accounting firm which was, immediately prior to the Change in Control, the
Company’s independent auditor, or if that firm refuses to serve, by another
qualified firm, whether or not serving as independent auditors, designated by
the Committee (the “Firm”), such payments or benefits (in whole or in part) do
not constitute parachute payments, including by reason of Section 280G(2)(A) or
Section 280G(b)(4)(A) of the Code; (B) no portion of the Total Payments the
receipt or enjoyment of which you shall have waived at such time and in such
manner as not to constitute a “payment” within the meaning of Section 280G(b) of
the Code shall be taken into account; (C) all “excess parachute payments” within
the meaning of Section 280G(b)(2) of the Code shall be treated as subject to the
Excise Tax unless, in the opinion of the Firm, such excess parachute payments
(in whole or in part) represent reasonable compensation for services actually
rendered (within the meaning of Section 280G(g)(4)(B) of the Code) in excess of
the “base amount” (within the meaning of Section 280G(b)(3) of the Code)
allocable to such reasonable compensation, or are otherwise not subject to the
Excise Tax; and (D) the value of any non-cash benefits or any deferred payment
or benefit shall be determined by the Firm in accordance with the principles of
Sections 280G(d)(3) and (4) of the Code and regulations or other guidance
thereunder. For purposes of determining whether any of your Payments shall be
reduced, you shall be deemed to pay federal income tax at the highest marginal
rate of federal income taxation (and state and local income taxes at the highest
marginal rate of taxation in the state and locality of your residence, net of
the maximum reduction in federal income taxes which could be obtained from
deduction of such state and local taxes) in the calendar year in which the
Payments are made. The Firm will be paid reasonable compensation by the Company
for its services.

(c) As soon as practicable following a Change in Control, but in no event later
than 30 days thereafter, if your Payments are proposed to be reduced, then the
Company shall provide to you a written statement setting forth the manner in
which your Total Payments were calculated and the basis for such calculations,
including, without limitation, any opinions or other advice the Company has
received from the Firm or other advisors or consultants (and any such opinions
or advice which are in writing shall be attached to the statement).

15. Miscellaneous. Neither you nor any person claiming under or through you
shall have any right or interest, whether vested or otherwise, in the Plan or
the Award, unless and until all of the terms, conditions and provisions of the
Plan and this Agreement shall have been

 

12

--------------------------------------------------------------------------------

complied with. In addition, neither the adoption of the Plan nor the execution
of this Agreement shall in any way affect the rights and powers of any person to
dismiss or discharge you at any time from employment with the American Express
companies. Notwithstanding anything herein to the contrary, neither the Company
nor any of its Affiliates (as that term is defined in the Plan) nor their
respective officers, directors, employees or agents shall have any liability to
you (or those claiming under or through you) under the Plan, this Agreement or
otherwise on account of any action taken, or decision not to take any action
made, by any of the foregoing persons with respect to the business or operations
of the Company or any of its Affiliates (as that term is defined in the Plan),
despite the fact that any such action or decision may adversely affect in any
way whatsoever Average Annual EPS, Average Annual Net Revenue, Average Annual
ROE or other financial measures or amounts which are accrued or payable or any
of your other rights or interests under this Agreement.

16. Governing Law. The validity, construction, interpretation, administration
and effect of this Agreement shall be governed by the substantive laws, but not
the choice of law rules, of the State of New York.

17. Section 409A Compliance. This Agreement and the payment of the Award
hereunder are intended to comply with Section 409A of the Code and the Treasury
Regulations promulgated and other official guidance issued thereunder, and this
Agreement shall be administered and interpreted consistent with such intent and
the American Express Section 409A Compliance Policy, as amended from time to
time, and any successor policy thereto. Notwithstanding any other provision of
this Agreement, to the extent that you are a Specified Employee at the time of
your separation from service and any payment is required to be delayed by six
months pursuant to Section 409A of the Code, then such payment shall be made,
without interest, on the first day of the seventh month following your
separation from service.

18. FDIA Limitations. Notwithstanding any other provision of this Agreement to
the contrary, any payments or benefits to you pursuant to this Agreement, or
otherwise, are subject to and conditioned upon their compliance with 12 USC
Section 1828(k) and any regulations promulgated, or other guidance issued, with
respect thereto.

19. Dodd-Frank Clawback. Notwithstanding any other provision of this Agreement
to the contrary, in order to comply with Section 10D of the Securities Exchange
Act of 1934, as amended, and any regulations promulgated, or national securities
exchange listing conditions adopted, with respect thereto (collectively, the
“Clawback Requirements”), if the Company is required to prepare an accounting
restatement due to the material noncompliance of the Company with any financial
reporting requirements under the securities laws, then you shall return to the
Company, or forfeit if not yet paid, the amount of any Award received during the
three-year period preceding the date on which the Company is required to prepare
the accounting restatement, based on the erroneous data, in excess of what would
have been paid to you under the accounting restatement as determined by the
Committee in accordance with the Clawback Requirements and any policy adopted by
the Committee pursuant to the Clawback Requirements.

*        *        *        *        *

 

13

--------------------------------------------------------------------------------

AMERICAN EXPRESS COMPANY

By the Compensation and Benefits

Committee of the Board of Directors:

J. LESCHLY

P. CHERNIN

R. MCGINN

E. MILLER

R. WALTER

By LOGO [g486442g90f83.jpg] Carol V. Schwartz

Notwithstanding any contrary provision in the American Express Company 2007
Incentive Compensation Plan, as amended, the Company reserves the right to
correct nonmaterial clerical errors in, and make subsequent nonmaterial
clarifications to, any Award Agreement in the future, without prior notification
to participants.

 

14

--------------------------------------------------------------------------------

AMERICAN EXPRESS COMPANY

2007 INCENTIVE COMPENSATION PLAN

PORTFOLIO GRANT 20        -20        

SCHEDULE A

 

Measure    Weighting    Maximum Payout Level       Threshold (0)    Target
(        )    Maximum (        )

Average Annual

EPS

                   

Average Annual

Net Revenue

                   

Average Annual

ROE

                   

Amex TSR

Relative to S&P

500

                   

For purposes of determining the Schedule A Value, if the Average Performance
Period Earnings Per Share, the Average Annual Net Revenue, the Average Annual
ROE or the Amex TSR Relative to S&P 500 are equal to or greater than those
levels needed to have some Schedule A Value and less than or equal to the
maximum specified levels, and are not represented on the table, the Schedule A
Value shall be determined by straight-line interpolation from the amounts
specified in such table immediately less than and greater than the amounts
actually attained.

Note: the Award is designed to provide the Committee maximum flexibility in
determining an appropriate award amount, while maintaining the ability to deduct
the amount of the Award. The tables produce the maximum deductible amount of the
Award, and not the amount actually to be paid. The Committee uses negative
discretion to reduce such amount as it deems appropriate.

 

15