UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-00248
---------------------------------------------
THE ADAMS EXPRESS COMPANY
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(Exact name of registrant as specified in charter)
7 Saint Paul Street, Suite 1140, Baltimore, Maryland 21202
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(Address of principal executive offices) (Zip code)
Lawrence L. Hooper, Jr.
The Adams Express Company
7 Saint Paul Street
Suite 1140
Baltimore, Maryland 21202
Registrant's telephone number, including area code: 410-752-5900
Date of fiscal year end: December 31, 2008
Date of reporting period: June 30, 2008
Item 1: Reports to Stockholders.
THE ADAMS EXPRESS COMPANY
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Board of Directors
Enrique R. Arzac /2,4/ Roger W. Gale /1,3,5/
Phyllis O. Bonanno /1,4,5/ Thomas H. Lenagh /2,3/
Kenneth J. Dale/ 3,4/ Kathleen T. McGahran /1,4,5/
Daniel E. Emerson/ 1,3,5 / Douglas G. Ober/ 1/
Frederic A. Escherich /2,3/ Craig R. Smith /2,4/
1.Member of Executive Committee
2.Member of Audit Committee
3.Member of Compensation Committee
4.Member of Retirement Benefits Committee
5.Member of Nominating and Governance Committee
Officers
Douglas G. Ober Chairman and
Chief Executive Officer
Joseph M. Truta President
David D. Weaver Executive Vice President
Lawrence L. Hooper, Jr. Vice President, General
Counsel and Secretary
Maureen A. Jones Vice President,
Chief Financial Officer
and Treasurer
David R. Schiminger Vice President--Research
D. Cotton Swindell Vice President--Research
Christine M. Sloan Assistant Treasurer
Geraldine H. Pare Assistant Secretary
--------
Stock Data
--------
Market Price (6/30/08) $11.85
Net Asset Value (6/30/08) $13.74
Discount: 13.8%
New York Stock Exchange ticker symbol: ADX
NASDAQ Mutual Fund Quotation Symbol: XADEX
Newspaper stock listings are generally under the abbreviation: AdaEx
----------------
Distributions in 2008
----------------
From Investment Income (paid or declared) $0.13
From Net Realized Gains 0.02
-----
Total $0.15
=====
----------------------
2008 Dividend Payment Dates
----------------------
March 1, 2008
June 1, 2008
September 1, 2008
December 27, 2008*
*Anticipated
Generation after generation -
[GRAPHIC]
we grow with you. tm
INVEST|PROTECT|GROW
The Adams Express Company
Semi-Annual Report - June 30, 2008
LETTER TO STOCKHOLDERS
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We submit herewith the financial statements of The Adams Express Company (the
Company) for the six months ended June 30, 2008. Also provided are the report
of the independent registered public accounting firm, a schedule of
investments, and other financial information.
Net assets of the Company at June 30, 2008 were $13.74 per share on 86,647,623
shares outstanding, compared with $15.72 per share at December 31, 2007 on
87,668,847 shares outstanding. On March 1, 2008, a distribution of $0.05 per
share was paid, consisting of $0.02 from 2007 investment income, $0.01 from
2007 short-term capital gain, $0.01 from 2007 long-term capital gain, and $0.01
from 2008 investment income, all taxable in 2008. A 2008 investment income
dividend of $0.05 per share was paid on June 1, 2008, and another $0.05 per
share investment income dividend has been declared to shareholders of record
August 12, 2008, payable September 1, 2008.
Net investment income for the six months ended June 30, 2008 amounted to
$11,509,546, compared with $16,387,719 for the same six month period in 2007.
These earnings are equal to $0.13 and $0.19 per share in each period.
Net capital gain realized on investments for the six months ended June 30, 2008
amounted to $18,996,616, or $0.22 per share.
For the six months ended June 30, 2008, the total return on the net asset value
(with dividends and capital gains reinvested) of the Company's shares was
(11.9)%. The total return on the market value of the Company's shares for the
period was (15.4)%. These compare to a (11.6)% total return for the Standard &
Poor's 500 Composite Stock Index and a (11.5)% total return for the Lipper
Large Cap Core Mutual Fund Average over the same time period.
For the twelve months ended June 30, 2008, the Company's total return on net
asset value was (13.4)% and on market value was (14.4)%. Comparable figures for
the S&P 500 and the Lipper Large Cap Core Mutual Fund Average were (13.1)% and
(12.3)%, respectively.
Current and potential stockholders can find information about the Company,
including the daily net asset value (NAV) per share, the market price, and the
discount/premium to the NAV, on our website at www.adamsexpress.com. Also
available on the website are a history of the Company, historical financial
information, and other useful content. Further information regarding
stockholder services is located on page 15 of this report.
-----------------
By order of the Board of Directors,
/s/
Douglas G. Ober,
Chairman and
Chief Executive Officer
/s/ Joseph M. Truta
Joseph M. Truta,
President
July 10, 2008
STATEMENT OF ASSETS AND LIABILITIES
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June 30, 2008
Assets
Investments* at value:
Common stocks and convertible securities
(cost $862,257,962) $1,014,805,608
Non-controlled affiliate, Petroleum & Resources Corporation
(cost $34,735,404) 95,321,479
Short-term investments (cost $75,619,755) 75,619,755
Securities lending collateral (cost $106,477,312) 106,477,312 $1,292,224,154
-------------------------------------------------------------------------------------------------
Cash 374,536
Receivables:
Investment securities sold 959,765
Dividends and interest 1,526,235
Prepaid pension cost 3,173,760
Prepaid expenses and other assets 2,229,074
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Total Assets 1,300,487,524
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Liabilities
Open written option contracts at value (proceeds $454,707) 220,400
Obligations to return securities lending collateral 106,477,312
Accrued expenses 3,368,931
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Total Liabilities 110,066,643
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Net Assets $1,190,420,881
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Net Assets
Common Stock at par value $0.001 per share, authorized 150,000,000 shares;
issued and outstanding 86,647,623 shares (includes 106,486 restricted
shares, 7,500 restricted stock units, and 6,333 deferred stock units) (Note 6) $ 86,648
Additional capital surplus 952,601,143
Accumulated other comprehensive income (Note 5) (1,549,593)
Undistributed net investment income 7,581,579
Undistributed net realized gain on investments 18,333,076
Unrealized appreciation on investments 213,368,028
----------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Stock $1,190,420,881
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Net Asset Value Per Share of Common Stock $13.74
----------------------------------------------------------------------------------------------------------------
* See Schedule of Investments on pages 9 and 10.
The accompanying notes are an integral part of the financial statements.
2
STATEMENT OF OPERATIONS
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Six Months Ended June 30, 2008
Investment Income
Income:
Dividends:
From unaffiliated issuers $ 13,033,402
From non-controlled affiliate 459,223
Interest and other income 974,768
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Total income 14,467,393
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Expenses:
Investment research 1,182,504
Administration and operations 666,167
Directors' fees 181,435
Transfer agent, registrar and custodian expenses 178,099
Reports and stockholder communications 153,296
Occupancy and other office expenses 115,943
Insurance 99,492
Investment data services 96,936
Auditing and accounting services 67,383
Travel, telephone and postage 47,410
Legal services 36,626
Other 132,556
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Total expenses 2,957,847
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Net Investment Income 11,509,546
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Other Comprehensive Income (Note 5) 430,570
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Realized Gain and Change in Unrealized Appreciation on Investments
Net realized gain on security transactions 18,887,277
Net realized gain distributed by regulated investment company (non-controlled affiliate) 109,339
Change in unrealized appreciation on investments (197,086,942)
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Net Loss on Investments (178,090,326)
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Change in Net Assets Resulting from Operations $(166,150,210)
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The accompanying notes are an integral part of the financial statements.
3
STATEMENTS OF CHANGES IN NET ASSETS
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Six Months Ended Year Ended
June 30, 2008 December 31, 2007
---------------- -----------------
From Operations:
Net investment income $ 11,509,546 $ 25,884,799
Net realized gain on investments 18,996,616 60,426,376
Change in unrealized appreciation on investments (197,086,942) (8,301,286)
Other comprehensive income (Note 5) 430,570 (156,058)
----------------------------------------------------------------------------------------------
Change in net assets resulting from operations (166,150,210) 77,853,831
----------------------------------------------------------------------------------------------
Distributions to Stockholders from:
Net investment income (6,961,677) (27,409,018)
Net realized gain from investment transactions (1,749,608) (60,607,292)
----------------------------------------------------------------------------------------------
Decrease in net assets from distributions (8,711,285) (88,016,310)
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From Capital Share Transactions:
Value of shares issued in payment of distributions 2,787 33,223,573
Cost of shares purchased (Note 4) (13,498,454) (22,516,525)
Deferred compensation (Notes 4,6) 298,516 516,648
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Change in net assets from capital share transactions (13,197,151) 11,223,696
----------------------------------------------------------------------------------------------
Total Change in Net Assets (188,058,646) 1,061,217
Net Assets:
Beginning of period 1,378,479,527 1,377,418,310
----------------------------------------------------------------------------------------------
End of period (including undistributed net investment
income of $7,581,579 and $3,033,710, respectively) $1,190,420,881 $1,378,479,527
----------------------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements.
4
NOTES TO FINANCIAL STATEMENTS
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1. Significant Accounting Policies
The Adams Express Company (the Company) is registered under the Investment
Company Act of 1940 as a diversified investment company. The Company is an
internally-managed fund whose investment objectives are preservation of
capital, the attainment of reasonable income from investments, and an
opportunity for capital appreciation.
The accompanying financial statements were prepared in accordance with
accounting principles generally accepted in the United States of America, which
require the use of estimates made by Company management. Management believes
that estimates and security valuations are appropriate; however, actual results
may differ from those estimates, and the security valuations reflected in the
financial statements may differ from the value the Company ultimately realizes
upon sale of the securities.
Affiliated Companies -- Investments in companies 5% or more of whose
outstanding voting securities are held by the Company are defined as
"Affiliated Companies" in Section 2(a)(3) of the Investment Company Act of 1940.
Security Transactions and Investment Income -- Investment transactions are
accounted for on the trade date. Gain or loss on sales of securities and
options is determined on the basis of identified cost. Dividend income and
distributions to stockholders are recognized on the ex-dividend date, and
interest income is recognized on the accrual basis.
Security Valuation -- Investments in securities traded on a national security
exchange are valued at the last reported sale price on the day of valuation.
Over-the-counter and listed securities for which a sale price is not available
are valued at the last quoted bid price. Short-term investments (excluding
purchased options) are valued at amortized cost which approximates fair value.
Purchased and written options are valued at the last quoted asked price.
The Company adopted Financial Accounting Standard Board Statement of Financial
Accounting Standards No. 157, Fair Value Measurements ("FAS 157"), effective
January 1, 2008. There was no impact on the fair value of assets individually
or in aggregate upon adoption. In accordance with FAS 157, fair value is
defined as the price that the Company would receive upon selling an investment
in an orderly transaction to an independent buyer. FAS 157 established a
three-tier hierarchy to establish classification of fair value measurements,
summarized as follows:
. Level 1 -- fair value is determined based on market data obtained from
independent sources; for example, quoted prices in active markets for
identical investments,
. Level 2 -- fair value is determined using other assumptions obtained from
independent sources; for example, quoted prices for similar investments,
. Level 3 -- fair value is determined using the Company's own assumptions,
developed based on the best information available in the circumstances.
The Company's investments at June 30, 2008 are classified as follows:
Investment in
securities Written options
-------------- ---------------
Level 1 $1,110,127,087 $220,400
Level 2 182,097,067* --
Level 3 -- --
----------------------------------------
Total $1,292,224,154 $ 220,400
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*Comprised of short-term investments and securities lending collateral.
2. Federal Income Taxes
The Company's policy is to distribute all of its taxable income to its
stockholders in compliance with the requirements of the Internal Revenue Code
applicable to regulated investment companies. Therefore, no federal income tax
provision is required. For federal income tax purposes, the identified cost of
securities at June 30, 2008 was $1,078,603,181 and net unrealized appreciation
aggregated $213,620,973, of which the related gross unrealized appreciation and
depreciation were $361,956,158 and $148,335,185, respectively.
Distributions are determined in accordance with income tax regulations which
may differ from generally accepted accounting principles. Accordingly, annual
reclassifications are made within the Company's capital accounts to reflect
income and gains available for distribution under income tax regulations. Any
income tax-related interest or penalties would be classified as income tax
expense.
3. Investment Transactions
The Company's investment decisions are made by a committee of management, and
recommendations to that committee are made by the research staff.
Purchases and sales of portfolio securities, other than options and short-term
investments, during the six months ended June 30, 2008 were $108,005,817 and
$103,510,389, respectively. Options may be written (sold) or purchased by the
Company. When the Company writes an option, an amount equal to the premium
received by the Company is recorded as a liability and is subsequently adjusted
to the current fair value of the option written. Premiums received from
unexercised put/call options are treated as realized gains from investments,
premiums received from exercised put options reduces the cost basis of the
securities purchased, and premiums received from exercised call options are
added to the proceeds from the sale of the underlying security in determining
whether there is a realized gain or loss. The Company as writer of an option
bears the risks of possible illiquidity of the option markets and the
unfavorable change in the price of the security underlying the written option.
The risk is limited to the premium originally paid for the option. A schedule
of outstanding option contracts as of June 30, 2008 can be found on page 12.
Transactions in written covered call and collateralized put options during the
six months ended June 30, 2008 were as follows:
Covered Calls Collateralized Puts
------------------- -------------------
Contracts Premiums Contracts Premiums
--------- --------- --------- ---------
Options outstanding,
December 31, 2007 1,757 $ 197,788 1,726 $ 194,530
Options written 4,700 574,828 3,400 431,681
Options terminated in
closing purchase
transactions (200) (26,300) -- --
Options expired (2,814) (339,129) (2,900) (362,288)
Options exercised (743) (92,390) (1,076) (124,013)
----------------------------------------------------------------
Options outstanding,
June 30, 2008 2,700 $ 314,797 1,150 $ 139,910
----------------------------------------------------------------
4. Capital Stock
The Company has 10,000,000 authorized and unissued preferred shares, $0.001 par
value.
On December 27, 2007, the Company issued 2,381,872 shares of its Common Stock
at a price of $13.945 per share (the average market price on December 10, 2007)
to stockholders of record on
5
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
November 21, 2007 who elected to take stock in payment of the year-end
distribution from 2007 capital gain and investment income. In addition, 597
shares were issued at a weighted average price of $14.00 per share as dividend
equivalents to holders of deferred stock units and restricted stock units under
the 2005 Equity Incentive Compensation Plan.
During 2008, the Company has issued 392 shares of its Common Stock at a
weighted average price of $12.97 per share as dividend equivalents to holders
of deferred stock units and restricted stock units under the 2005 Equity
Incentive Compensation Plan.
The Company may purchase shares of its Common Stock from time to time at such
prices and amounts as the Board of Directors may deem advisable.
Transactions in Common Stock for 2008 and 2007 were as follows:
Shares Amount
----------------------- --------------------------
Six months Six months
ended Year ended ended Year ended
June 30, December 31, June 30, December 31,
2008 2007 2008 2007
---------- ------------ ------------ ------------
Shares issued in
payment of
distributions 392 2,382,469 $ 2,787 $ 33,223,573
Shares purchased (at
a weighted
average discount
from net asset
value of 13.1%
and 13.2%,
respectively) (1,063,308) (1,585,773) (13,498,454) (22,516,525)
Net activity
under the Equity-
Based
Compensation
Plans 41,692 33,928 298,516 516,648
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Net change (1,021,224) 830,624 $(13,197,151) $ 11,223,696
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5. Retirement Plans
The Company's non-contributory qualified defined benefit pension plan
("qualified plan") covers all employees with at least one year of service. In
addition, the Company has a non-contributory nonqualified defined benefit plan
which provides eligible employees with retirement benefits to supplement the
qualified plan. Benefits are based on length of service and compensation during
the last five years of employment.
The funded status of the plans is recognized as an asset (overfunded plan) or a
liability (underfunded plan) in the Statement of Assets and Liabilities.
Changes in the prior service costs and accumulated actuarial gains and losses
are recognized as accumulated other comprehensive income, a component of net
assets, in the year in which the changes occur.
The Company's policy is to contribute annually to the plans those amounts that
can be deducted for federal income tax purposes, plus additional amounts as the
Company deems appropriate in order to provide assets sufficient to meet
benefits to be paid to plan participants. During the six months ended June 30,
2008, the Company did not contribute to the plans. The Company does not
anticipate making any contribution to the overfunded qualified plan in 2008.
The following table aggregates the components of the plans' net periodic
pension cost:
Six months
ended Year ended
June 30, December 31,
2008 2007
---------- ------------
Service cost $ 168,823 $ 487,315
Interest cost 224,561 568,495
Expected return on plan assets (345,871) (855,553)
Amortization of prior service cost 47,930 94,508
Amortization of net loss 59,449 162,625
-----------------------------------------------------------
Net periodic pension cost $ 154,892 $ 457,390
-----------------------------------------------------------
The Company also sponsors a defined contribution plan that covers substantially
all employees. For the six months ended June 30, 2008, the Company expensed
contributions of $84,817. The Company does not provide postretirement medical
benefits.
6. Equity-Based Compensation
Although the Stock Option Plan of 1985 ("1985 Plan") has been discontinued and
no further grants will be made under this plan, unexercised grants of stock
options and stock appreciation rights granted in 2004 and prior years remain
outstanding. The exercise price of the unexercised options and related stock
appreciation rights is the fair market value on date of grant, reduced by the
per share amount of capital gains paid by the Company during subsequent years.
All options and related stock appreciation rights terminate 10 years from date
of grant, if not exercised.
A summary of option activity under the 1985 Plan as of June 30, 2008, and
changes during the six month period then ended, is presented below:
Weighted- Weighted-
Average Average
Exercise Remaining
Options Price Life (Years)
------- --------- ------------
Outstanding at December 31, 2007 146,804 $11.63 3.47
Exercised (9,246) 8.63 --
-----------------------------------------------------------------
Outstanding at June 30, 2008 137,558 $11.82 3.16
-----------------------------------------------------------------
Exercisable at June 30, 2008 89,258 $11.59 2.93
-----------------------------------------------------------------
The options outstanding as of June 30, 2008 are set forth below:
Weighted Weighted
Average Average
Options Exercise Remaining
Exercise Price Outstanding Price Life (Years)
-------------- ----------- -------- ------------
$7.00-$9.24 18,222 $ 7.67 4.50
$9.25-$11.49 68,188 10.12 3.61
$11.50-$13.74 -- -- --
$13.75-$16.00 51,148 15.56 2.09
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Outstanding at June 30, 2008 137,558 $11.82 3.16
---------------------------------------------------------------
Compensation cost resulting from stock options and stock appreciation rights
granted under the 1985 Plan is based on the intrinsic value of the award,
recognized over the award's vesting period, and remeasured at each reporting
date through the date of settlement. The total compensation cost/(credit)
recognized for the six months ended June 30, 2008 was $(161,490).
6
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
The 2005 Equity Incentive Compensation Plan ("2005 Plan"), adopted at the 2005
Annual Meeting, permits the grant of stock options, restricted stock awards and
other stock incentives to key employees and all non-employee directors. The
2005 Plan provides for the issuance of up to 3,413,131 shares of the Company's
Common Stock, including both performance and nonperformance-based restricted
stock. Performance-based restricted stock awards vest at the end of a specified
three year period, with the ultimate number of shares earned contingent on
achievement of certain performance targets. If performance targets are not
achieved, all or a portion of the performance-based awards are forfeited and
become available for future grants. Nonperformance-based restricted stock
awards vest ratably over a three year period and nonperformance-based
restricted stock units (granted to non-employee directors) vest over a one year
period. It is the current intention that employee grants will be
performance-based. The 2005 Plan provides for accelerated vesting in the event
of death or retirement. Non- employee directors also may elect to defer a
portion of their cash compensation, with such deferred amount to be paid by
delivery of deferred stock units. Outstanding awards are granted at fair market
value on grant date. The number of shares of Common Stock which remains
available for future grants under the 2005 Plan at June 30, 2008 is 3,258,668
shares.
A summary of the status of the Company's awards granted under the 2005 Plan as
of June 30, 2008, and changes during the six month period then ended, is
presented below:
Weighted
Average
Shares/ Grant-Date
Awards Units Fair Value
------ ------- ----------
Balance at December 31, 2007 87,471 $13.29
Granted:
Restricted stock 34,438 13.14
Restricted stock units 7,500 12.49
Deferred stock units 1,026 13.26
Vested (10,116) 13.46
Forfeited -- --
---------------------------------------------------------------
Balance at June 30, 2008 (includes 103,354
performance-based awards and 16,965
nonperformance-based awards) 120,319 $13.18
---------------------------------------------------------------
Compensation costs resulting from awards granted under the 2005 Plan are based
on the fair value of the award on grant date (determined by the average of the
high and low price on grant date) and recognized on a straight-line basis over
the requisite service period. For those awards with performance conditions,
compensation costs are based on the most probable outcome and, if such goals
are not met, compensation cost is not recognized and any previously recognized
compensation cost is reversed. The total compensation costs for restricted
stock granted to employees for the period ending June 30, 2008 were $247,205.
The total compensation costs for restricted stock units granted to non-
employee directors for the period ended June 30, 2008 were $53,968. As of June
30, 2008, there were total unrecognized compensation costs of $731,029, a
component of additional capital surplus, related to nonvested equity-based
compensation arrangements granted under the 2005 Plan. Those costs are expected
to be recognized over a weighted average period of 1.79 years. The total fair
value of shares vested during the six month period ended June 30, 2008 was
$106,363.
7. Officer and Director Compensation
The aggregate remuneration paid during the six months ended June 30, 2008 to
officers and directors amounted to $1,665,343, of which $167,281 was paid as
fees and compensation to directors who were not officers. These amounts
represent the taxable income to the Company's officers and directors and
therefore differ from the amounts reported in the accompanying Statement of
Operations that are recorded and expensed in accordance with generally accepted
accounting principles.
8. Portfolio Securities Loaned
The Company makes loans of securities to brokers, secured by cash deposits,
U.S. Government securities, or bank letters of credit. The Company accounts for
securities lending transactions as secured financing and receives compensation
in the form of fees or retains a portion of interest on the investment of any
cash received as collateral. The Company also continues to receive interest or
dividends on the securities loaned. The loans are secured at all times by
collateral of at least 102% of the fair value of the securities loaned plus
accrued interest. The market value of the loaned securities is calculated based
upon the most recent closing prices and any additional required collateral is
delivered to the Company on the next business day. Gain or loss in the fair
value of the securities loaned that may occur during the term of the loan will
be for the account of the Company. At June 30, 2008, the Company had securities
on loan of $102,136,348 and held collateral of $106,477,312, consisting of an
investment trust fund which may invest in money market instruments, commercial
paper, repurchase agreements, U.S. Treasury Bills, and U.S. agency obligations.
-----------------
This report, including the financial statements herein, is transmitted to the
stockholders of The Adams Express Company for their information. It is not a
prospectus, circular or representation intended for use in the purchase or
sale of shares of the Company or of any securities mentioned in the report.
The rates of return will vary and the principal value of an investment will
fluctuate. Shares, if sold, may be worth more or less than their original
cost. Past performance is not indicative of future
investment results.
7
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
------------------------
Six Months Ended Year Ended December 31
---------------------- ------------------------------------------------------
June 30, June 30,
2008 2007 2007 2006 2005 2004 2003
---------- ---------- ---------- ---------- ---------- ---------- ----------
Per Share Operating Performance
Net asset value, beginning of period $15.72 $15.86 $15.86 $14.71 $15.04 $14.36 $12.12
---------------------------------------------------------------------------------------------------------------------
Net investment income 0.13 0.19 0.30* 0.23 0.22 0.23** 0.19
Net realized gains and increase
(decrease) in unrealized
appreciation (2.03) 1.09 0.61 1.86 0.32 1.39 2.85
Change in accumulated other
comprehensive income (note 5) 0.00 0.00 0.00 (0.02) -- -- --
---------------------------------------------------------------------------------------------------------------------
Total from investment operations (1.90) 1.28 0.91 2.07 0.54 1.62 3.04
---------------------------------------------------------------------------------------------------------------------
Less distributions
Dividends from net investment
income (0.08) (0.09) (0.32) (0.23) (0.22) (0.24) (0.17)
Distributions from net realized
gains (0.02) (0.01) (0.71) (0.67) (0.64) (0.66) (0.61)
---------------------------------------------------------------------------------------------------------------------
Total distributions (0.10) (0.10) (1.03) (0.90) (0.86) (0.90) (0.78)
---------------------------------------------------------------------------------------------------------------------
Capital share repurchases 0.02 0.02 0.04 0.04 0.05 0.02 0.04
Reinvestment of distributions 0.00 0.00 (0.06) (0.06) (0.06) (0.06) (0.06)
---------------------------------------------------------------------------------------------------------------------
Total capital share transactions 0.02 0.02 0.02 (0.02) (0.01) (0.04) (0.02)
---------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $13.74 $17.06 $15.72 $15.86 $14.71 $15.04 $14.36
---------------------------------------------------------------------------------------------------------------------
Market price, end of period $11.85 $14.89 $14.12 $13.87 $12.55 $13.12 $12.41
Total Investment Return
Based on market price (15.4)% 8.1% 9.4% 17.9% 2.2% 13.2% 25.2%
Based on net asset value (11.9)% 8.3% 6.5% 15.0% 4.5% 12.1% 26.3%
Ratios/Supplemental Data
Net assets, end of period
(in 000's) $1,190,421 $1,465,250 $1,378,480 $1,377,418 $1,266,729 $1,295,549 $1,218,862
Ratio of expenses to average
net assets 0.46%+ 0.46%+ 0.44% 0.50% 0.45% 0.43% 0.47%
Ratio of net investment income
to average net assets 1.79%+ 2.31%+ 1.82% 1.50% 1.44% 1.54% 1.45%
Portfolio turnover 17.15%+ 13.11%+ 10.46% 10.87% 12.96% 13.43% 12.74%
Number of shares outstanding at
end of period (in 000's) 86,648 85,893 87,669 86,838 86,100 86,135 84,886
------------------------
--------
*In 2007 the Company received $5,100,000, or $0.06 per share, in a special
cash dividend from Dean Foods Co., of which $2,295,000, or $0.03 per share,
was considered a taxable dividend.
**In 2004 the Company received $2,400,000, or $0.03 per share, in an
extraordinary dividend from Microsoft Corp.
+Ratios presented on an annualized basis.
8
SCHEDULE OF INVESTMENTS
--------------------------------------------------------------------------------
June 30, 2008
Shares Value (A)
- --------- -------------
Stocks and Convertible Securities -- 93.3%
Consumer -- 17.2%
Consumer Discretionary -- 4.6%
Comcast Corp. 525,000 $ 9,959,250
Harley-Davidson, Inc. 130,000 4,713,800
Lowe's Companies, Inc. (B) 600,000 12,450,000
Newell Rubbermaid Inc. 400,000 6,716,000
Ryland Group Inc. (B) 343,500 7,491,735
Target Corp. 290,000 13,482,100
-------------
54,812,885
-------------
Consumer Staples -- 12.6%
Avon Products, Inc. 402,400 14,494,448
Bunge Ltd. (B) 100,000 10,769,000
Coca-Cola Co. 200,000 10,396,000
CVS/Caremark Corp. 250,000 9,892,500
Dean Foods Co. 340,000 6,670,800
Del Monte Foods Co. 1,300,000 9,230,000
Hansen Natural Corp. (B) (C) 375,000 10,807,500
PepsiCo, Inc. 360,000 22,892,400
Procter & Gamble Co. 340,000 20,675,400
Safeway Inc. 390,000 11,134,500
Unilever plc ADR 800,000 22,728,000
-------------
149,690,548
-------------
Energy -- 18.2%
Chevron Corp. 150,000 14,869,500
ConocoPhillips 295,000 27,845,050
Exxon Mobil Corp. 215,000 18,947,950
Halliburton Co. 300,000 15,921,000
Petroleum & Resources
Corporation (D) 2,186,774 95,321,479
Schlumberger Ltd. 380,000 40,823,400
Transocean Inc. (C) 20,000 3,047,800
-------------
216,776,179
-------------
Financials -- 11.4%
Banking -- 9.3%
Bank of America Corp. 730,000 17,425,100
Bank of New York Mellon Corp. 403,775 15,274,808
Morgan Stanley (B) 200,000 7,214,000
PNC Financial Services Group,
Inc. (The) (B) 200,000 11,420,000
Prosperity Bancshares, Inc. 250,000 6,682,500
State Street Corp. 260,000 16,637,400
Visa Inc. (C) 20,000 1,626,200
Wachovia Corp. (B) 570,000 8,852,100
Wells Fargo & Co. 665,000 15,793,750
Wilmington Trust Corp. (B) 363,000 9,597,720
-------------
110,523,578
-------------
Shares Value (A)
- --------- -------------
Insurance -- 2.1%
American International Group,
Inc. (B) 500,000 $ 13,230,000
Prudential Financial, Inc. 190,000 11,350,600
-------------
24,580,600
-------------
Health Care -- 11.7%
Abbott Laboratories 320,000 16,950,400
Bristol-Myers Squibb Co. 345,000 7,082,850
Genentech, Inc. (C) 220,000 16,698,000
Johnson & Johnson 255,000 16,406,700
Medtronic, Inc. 310,000 16,042,500
Pfizer Inc. 1,120,000 19,566,400
Senomyx, Inc. (B) (C) 984,400 4,853,092
Teva Pharmaceutical Industries
Ltd. ADR 370,000 16,946,000
Wyeth Co. 325,000 15,587,000
Zimmer Holdings, Inc. (C) 140,000 9,527,000
-------------
139,659,942
-------------
Industrials -- 12.7%
Cintas Corp. 300,000 7,953,000
Curtiss-Wright Corp. (B) 360,000 16,106,400
Emerson Electric Co. 300,000 14,835,000
General Electric Co. 1,388,000 37,045,720
Illinois Tool Works Inc. 250,000 11,877,500
Masco Corp. 450,000 7,078,500
Oshkosh Corp. (B) 305,000 6,310,450
3M Co. 160,000 11,134,400
Spirit AeroSystems Holdings,
Inc. (C) 550,000 10,549,000
Tata Motors Ltd. ADR 1,000,000 10,050,000
United Technologies Corp. 300,000 18,510,000
-------------
151,449,970
-------------
Information Technology -- 11.5%
Communication Equipment -- 0.9%
Corning Inc. 500,000 11,525,000
-------------
Computer Related -- 8.5%
Automatic Data Processing Inc. 300,000 12,570,000
Cisco Systems, Inc. (C) 850,000 19,771,000
Dell Inc. (C) 585,000 12,799,800
Microsoft Corp. 1,180,000 32,461,800
Oracle Corp. (C) 1,100,000 23,100,000
-------------
100,702,600
-------------
Electronics -- 2.1%
Broadcom Corp. (C) 400,000 10,916,000
Intel Corp. 640,000 13,747,200
-------------
24,663,200
-------------
9
SCHEDULE OF INVESTMENTS (CONTINUED)
--------------------------------------------------------------------------------
June 30, 2008
Shares/
Prin. Amt Value (A)
- ------------ --------------
Materials -- 5.1%
Air Products and Chemicals,
Inc. 230,000 $ 22,737,800
du Pont (E.I.) de Nemours
and Co. 360,000 15,440,400
Lubrizol Corp 220,000 10,192,600
Rohm & Haas Co. (B) 260,700 12,106,908
--------------
60,477,708
--------------
Telecom Services -- 1.5%
AT&T Corp. 400,000 13,476,000
Windstream Corp. 310,178 3,827,597
--------------
17,303,597
--------------
Utilities -- 4.0%
Duke Energy Corp. 611,560 10,628,913
MDU Resources Group,
Inc. 562,500 19,608,750
Northeast Utilities 350,000 8,935,500
Spectra Energy Corp. 305,780 8,788,117
--------------
47,961,280
--------------
Total Stocks and Convertible Securities
(Cost $896,993,366) (E) 1,110,127,087
--------------
Short-Term Investments -- 6.4%
U.S. Government Obligations -- 1.7%
U.S. Treasury Bills,
1.71%, due 8/14/08 $ 20,000,000 19,958,200
--------------
Time Deposit -- 0.0%
Bank of America,
1.60%, due 7/1/08 205,269
--------------
Commercial Paper -- 4.7%
American Express Credit
Corp., 2.00 - 2.37%,
due 7/8/08 - 7/24/08 $11,400,000 11,388,713
American General Finance
Corp., 2.47 - 2.68%,
due 7/3/08 - 7/22/08 $8,800,000 8,795,513
Prin. Amt. Value (A)
- ----------- --------------
Chevron Funding Corp.,
2.07%, due 7/1/08 $ 7,000,000 $ 7,000,000
General Electric Capital Corp.,
2.00 - 2.28%,
due 7/15/08 - 8/14/08 5,700,000 5,693,960
Prudential Funding, LLC,
1.98 - 2.15%,
due 7/8/08 - 7/29/08 15,000,000 14,985,285
Toyota Motor Credit Corp.,
2.09 - 2.12%,
due 7/10/08 - 7/22/08 7,600,000 7,592,815
--------------
55,456,286
--------------
Total Short-Term Investments
(Cost $75,619,755) 75,619,755
--------------
Total Securities Lending Collateral -- 8.9%
(Cost $106,477,312)
Brown Brothers Investment
Trust, 2.70%, due 7/1/08 106,477,312
--------------
Total Investments -- 108.6%
(Cost $1,079,090,433) 1,292,224,154
Cash, receivables, prepaid pension cost,
prepaid expenses and other assets, less
liabilities -- (8.6)% (101,803,273)
--------------
Net Assets -- 100% $1,190,420,881
==============
--------------------------------------------------------------------------------
Notes:
(A)See note 1 to financial statements. Securities are listed on the New York
Stock Exchange, the American Stock Exchange or the NASDAQ.
(B)Some of the shares of this company are on loan. See note 8 to financial
statements.
(C)Presently non-dividend paying.
(D)Non-controlled affiliate, a closed-end sector fund, registered as an
investment company under the Investment Company Act of 1940.
(E)The aggregate market value of stocks held in escrow at June 30, 2008
covering open call option contracts written was $14,050,250. In addition,
the aggregate market value of securities segregated by the Company's
custodian required to collateralize open put option contracts written was
$6,075,000.
10
PORTFOLIO SUMMARY
--------------------------------------------------------------------------------
June 30, 2008
(unaudited)
Ten Largest Portfolio Holdings
Market Value % of Net Assets
- ------------ ---------------
Petroleum & Resources Corporation* $ 95,321,479 8.0
Schlumberger Ltd. 40,823,400 3.4
General Electric Co. 37,045,720 3.1
Microsoft Corp. 32,461,800 2.7
ConocoPhillips 27,845,050 2.4
Oracle Corp. 23,100,000 2.0
PepsiCo, Inc. 22,892,400 1.9
Air Products and Chemicals, Inc. 22,737,800 1.9
Unilever plc ADR 22,728,000 1.9
Procter & Gamble Co. 20,675,400 1.7
------------ ----
Total $345,631,049 29.0%
----------------------------------------------------------------
*Non-controlled affiliate
Sector Weightings
[CHART]
Sector Weightings
Consumer 17.2
Energy 18.2
Financials 11.4
Health Care 11.7
Industrials 12.7
Information Technology 11.5
Materials 5.1
Telecom Services 1.5
Utilities 4.0
Short-Term Investments 6.4
11
SCHEDULE OF OUTSTANDING OPTION CONTRACTS
--------------------------------------------------------------------------------
June 30, 2008
Contracts Contract
(100 shares Strike Expiration Appreciation/
each) Security Price Date (Depreciation)
---------------------------------------------------------------------------------
COVERED CALLS
200 Air Products and Chemicals, Inc.... $ 115 Sep 08 $ 400
150 American International Group, Inc.. 39 Aug 08 13,050
200 American International Group, Inc.. 60 Aug 08 21,100
150 Avon Products, Inc................. 45 Jul 08 15,675
100 Bunge Ltd.......................... 160 Jul 08 10,255
200 du Pont (E.I.) de Nemours and Co... 55 Oct 08 27,400
100 Genentech, Inc..................... 100 Sep 08 10,200
250 PepsiCo, Inc....................... 75 Jul 08 31,124
150 Prudential Financial, Inc.......... 105 Sep 08 11,550
250 Ryland Group Inc................... 50 Jul 08 23,220
200 Ryland Group Inc................... 50 Oct 08 27,399
150 State Street Corp.................. 105 Aug 08 17,550
200 Target Corp........................ 65 Jul 08 26,999
200 Target Corp........................ 67.50 Jul 08 21,200
200 Visa Inc........................... 105 Sep 08 (2,974)
----- --------
2,700 254,148
----- --------
COLLATERALIZED PUTS
250 Hansen Natural Corp................ 22.50 Sep 08 (9,890)
150 Procter & Gamble Co................ 57.50 Jul 08 10,050
100 Prudential Financial, Inc.......... 65 Jul 08 (54,300)
250 Spirit AeroSystems Holdings, Inc... 20 Jul 08 499
200 State Street Corp.................. 50 Aug 08 10,400
200 Transocean Inc..................... 125 Jul 08 23,400
----- --------
1,150 (19,841)
----- --------
$234,307
========
-----------------
Common Stock
Listed on the New York Stock Exchange
The Adams Express Company
Seven St. Paul Street, Suite 1140, Baltimore, MD 21202
(410) 752-5900 or (800) 638-2479
Website: www.adamsexpress.com
E-mail: contact@adamsexpress.com
Counsel: Chadbourne & Parke L.L.P.
Independent Registered Public Accounting Firm: PricewaterhouseCoopers LLP
Transfer Agent & Registrar: American Stock Transfer & Trust Co.
Custodian of Securities: Brown Brothers Harriman & Co.
12
CHANGES IN PORTFOLIO SECURITIES
--------------------------------------------------------------------------------
During the Three Months Ended June 30, 2008
(unaudited)
Shares
----------------------------------
Held
Additions Reductions June 30, 2008
--------- ---------- -------------
Chevron Corp...................... 150,000 150,000
Halliburton Co.................... 300,000 300,000
Hansen Natural Corp............... 375,000 375,000
Oshkosh Corp...................... 10,000 305,000
Prudential Financial, Inc......... 20,000 190,000
Schlumberger Ltd.................. 140,000 140,000 380,000
Spirit AeroSystems Holdings, Inc.. 25,000 550,000
Tata Motors Ltd. ADR.............. 250,000 1,000,000
Unilever plc ADR.................. 250,000 800,000
Aqua America, Inc................. 499,000 --
BJ's Wholesale Club, Inc.......... 400,000 --
Emerson Electric Co............... 100,000 300,000
ENSCO International, Inc.......... 209,150 --
Fifth Third Bancorp............... 280,000 --
Gannett Co., Inc.................. 112,500 --
Marathon Oil Co................... 240,000 --
Rohm & Haas Co.................... 39,300 260,700
United Parcel Service, Inc........ 155,000 --
HISTORICAL FINANCIAL STATISTICS
--------------------------------------------------------------------------------
(unaudited)
Dividends Distributions Total
From From Net Dividends
Net Asset Market Investment Realized and Annual
Value Of Shares Value Per Value Income Gains Distributions Rate of
Dec. 31 Net Assets Outstanding* Share* Per Share* Per Share* Per Share* Per Share* Distribution**
------- ---------- ------------ --------- ---------- ---------- ------------- ------------- --------------
1998 $1,688,080,336 77,814,977 $21.69 $17.75 $.30 $1.10 $1.40 8.17%
1999 2,170,801,875 80,842,241 26.85 22.38 .26 1.37 1.63 8.53
2000 1,951,562,978 82,292,262 23.72 21.00 .22 1.63 1.85 7.76
2001 1,368,366,316 85,233,262 16.05 14.22 .26 1.39 1.65 9.44
2002 1,024,810,092 84,536,250 12.12 10.57 .19 .57 .76 6.14
2003 1,218,862,456 84,886,412 14.36 12.41 .17 .61 .78 6.80
2004 1,295,548,900 86,135,292 15.04 13.12 .24 .66 .90 7.05
2005 1,266,728,652 86,099,607 14.71 12.55 .22 .64 .86 6.65
2006 1,377,418,310 86,838,223 15.86 13.87 .23 .67 .90 6.80
2007 1,378,479,527 87,668,847 15.72 14.12 .32 .71 1.03 7.15
June 30, 2008 1,190,420,881 86,647,623 13.74 11.85 .13+ .02+ .15+ --
--------
*Adjusted to reflect the 3-for-2 stock split effected in October 2000.
**The annual rate of distribution is the total dividends and capital gain
distributions during the year divided by the average daily market price of
the Company's Common Stock.
+ Paid or declared.
13
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
--------------------------------------------------------------------------------
To the Board of Directors and Stockholders of
The Adams Express Company:
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of The Adams Express Company (the
"Company") at June 30, 2008, the results of its operations, the changes in its
net assets and the financial highlights for each of the periods presented, in
conformity with accounting principles generally accepted in the United States
of America. These financial statements and financial highlights (hereafter
referred to as "financial statements") are the responsibility of the Company's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits, which included confirmation of
securities at June 30, 2008 by correspondence with the custodian and brokers,
provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Baltimore, Maryland
July 14, 2008
OTHER INFORMATION
--------------------------------------------------------------------------------
Statement on Quarterly Filing of Complete Portfolio Schedule
In addition to publishing its complete schedule of portfolio holdings in the
First and Third Quarter Reports to stockholders, the Company files its complete
schedule of portfolio holdings with the Securities and Exchange Commission for
the first and third quarters of each fiscal year on Form N-Q. The Company's
Forms N-Q are available on the Commission's website at www.sec.gov. The
Company's Forms N-Q may be reviewed and copied at the Commission's Public
Reference Room, and information on the operation of the Public Reference Room
may be obtained by calling (800) SEC-0330. The Company also posts its Forms N-Q
on its website at www.adamsexpress.com under the heading "Financial Reports".
Proxy Voting Policies and Record
A description of the policies and procedures that the Company uses to determine
how to vote proxies relating to portfolio securities owned by the Company and
information as to how the Company voted proxies relating to portfolio
securities during the 12 month period ended June 30, 2008 are available (i)
without charge, upon request, by calling the Company's toll free number at
(800) 638-2479; (ii) on the Company's website by clicking on "Corporate
Information" heading on the website; and (iii) on the Securities and Exchange
Commission's website at http//www.sec.gov.
Privacy Policy
In order to conduct its business, The Adams Express Company, through its
transfer agent, currently American Stock Transfer & Trust Company, collects and
maintains certain nonpublic personal information about our stockholders of
record with respect to their transactions in shares of our securities. This
information includes the stockholder's address, tax identification or Social
Security number, share balances, and dividend elections. We do not collect or
maintain personal information about stockholders whose shares of our securities
are held in "street name" by a financial institution such as a bank or broker.
We do not disclose any nonpublic personal information about you, our other
stockholders or our former stockholders to third parties unless necessary to
process a transaction, service an account or as otherwise permitted by law.
To protect your personal information internally, we restrict access to
nonpublic personal information about our stockholders to those employees who
need to know that information to provide services to our stockholders. We also
maintain certain other safeguards to protect your nonpublic personal
information.
14
STOCKHOLDER INFORMATION AND SERVICES
--------------------------------------------------------------------------------
DIVIDEND PAYMENT SCHEDULE
The Company presently pays dividends four times a year, as follows: (a) three
interim distributions on or about March 1, June 1, and September 1, and (b) a
"year-end" distribution, payable in late December, consisting of the estimated
balance of the net investment income for the year and the net realized capital
gain earned through October 31. Stockholders may elect to receive the year-end
distribution in stock or cash. In connection with this distribution, all
stockholders of record are sent a dividend announcement notice and an election
card in mid-November.
Stockholders holding shares in "street" or brokerage accounts may make their
election by notifying their brokerage house representative.
INVESTORS CHOICE
INVESTORS CHOICE is a direct stock purchase and sale plan, as well as a
dividend reinvestment plan, sponsored and administered by our transfer agent,
American Stock Transfer & Trust Company (AST). The Plan provides registered
stockholders and interested first time investors an affordable alternative for
buying, selling, and reinvesting in Adams Express shares.
The costs to participants in administrative service fees and brokerage
commissions for each type of transaction are listed below.
Initial Enrollment and
Optional Cash Investments
Service Fee $2.50 per investment
Brokerage Commission $0.05 per share
Reinvestment of Dividends*
Service Fee 2% of amount invested
(maximum of $2.50 per investment)
Brokerage Commission $0.05 per share
Sale of Shares
Service Fee $10.00
Brokerage Commission $0.05 per share
Deposit of Certificates for safekeeping $7.50.
Book to Book Transfers Included
To transfer shares to another participant or to a new participant
Fees are subject to change at any time.
Minimum and Maximum Cash Investments
Initial minimum investment (non-holders) $500.00
Minimum optional investment
(existing holders) $50.00
Electronic Funds Transfer
(monthly minimum) $50.00
Maximum per transaction $25,000.00
Maximum per year NONE
A brochure which further details the benefits and features of INVESTORS CHOICE
as well as an enrollment form may be obtained by contacting AST.
For Non-Registered Stockholders
For stockholders whose stock is held by a broker in "street" name, the AST
INVESTORS CHOICE Direct Stock Purchase and Sale Plan remains available through
many registered investment security dealers. If your shares are currently held
in a "street" name or brokerage account, please contact your broker for details
about how you can participate in AST's Plan or contact AST.
----------
The Company
The Adams Express Company
Lawrence L. Hooper, Jr.
Vice President, General Counsel and Secretary
Seven St. Paul Street, Suite 1140, Baltimore, MD 21202
(800) 638-2479
Website: www.adamsexpress.com
E-mail: contact@adamsexpress.com
The Transfer Agent
American Stock Transfer & Trust Company
Address Stockholder Inquiries to:
Stockholder Relations Department
59 Maiden Lane
New York, NY 10038
(877) 260-8188
Website: www.amstock.com
E-mail: info@amstock.com
Investors Choice Mailing Address:
Attention: Dividend Reinvestment
P.O. Box 922
Wall Street Station
New York, NY 10269-0560
Website: www.amstock.com
E-mail: info@amstock.com
*The year-end dividend and capital gain distribution will usually be made in
newly issued shares of common stock. There are no fees or commissions in
connection with this dividend and capital gain distribution when made in newly
issued shares.
15
Item 2: Code(s) of Ethics for senior financial officers -
Item not applicable to semi-annual report.
Item 3: Audit Committee Financial Expert - Item not
applicable to semi-annual report.
Item 4: Principal Accountant Fees and Services - Item not
applicable to semi-annual report.
Item 5: Audit Committee of Listed Registrants - Item not
applicable to semi-annual report.
Item 6: Schedule of Investments - This schedule is included
as part of the report to shareholders filed under Item 1 of
this form.
Item 7: Disclosure of Proxy Voting Policies and Procedures
for Closed-End Management Investment Companies - Item not
applicable to semi-annual report.
Item 8: Portfolio Managers of Closed-End Management
Investment Companies - Item not applicable to semi-annual
report.
Item 9: Purchases of Equity Securities by Closed-End
Management Investment Company and Affiliated Purchasers.
Maximum
Total Number (or
Number of Approximate
Shares (or Dollar Value)
Total Units) of Shares (or
Number Purchased Units) that
of Average as Part of May Yet Be
Shares Price Publicly Purchased
(or Paid per Announced Under the
Units) Share (or Plans or Plans or
Period(2) Purchased Unit) Programs Programs
-------- --------- --------- --------- ---------
Jan. 2008 159,576 $ 12.64 159,576 4,108,860
Feb. 2008 174,918 $ 12.75 174,918 3,933,942
Mar. 2008 240,814 $ 12.44 240,814 3,693,128
Apr. 2008 239,900 $ 12.89 239,900 3,453,228
May 2008 108,100 $ 13.12 108,100 3,345,128
June 2008 140,000 $ 12.47 140,000 3,205,128
-------- --------- --------- --------- ---------
Total 1,063,308(1) $ 12.69 1,063,308(2) 3,205,128(2)
(1) There were no shares purchased other than through a
publicly announced plan or program.
(2.a) The Plan was reapproved on December 13, 2007.
(2.b) The share amount approved in 2007 was 5% of
outstanding shares, or approximately 4,268,436 shares.
(2.c) Unless reapproved, the Plan will expire on or about
December 11, 2008.
(2.d) None.
(2.e) None.
Item 10. Submission of Matters to a Vote of Security Holders.
There were no material changes to the procedures by which
shareholders may recommend nominees to the registrant's
board of directors made or implemented after the registrant
last provided disclosure in response to the requirements of
Item 407(c)(2)(iv) of Regulation S-K (17 CFR 229.407) (as
required by Item 22(b)(15) of Schedule 14A (17 CFR 240.14a-
101)), or this Item.
Item 11. Controls and Procedures.
Conclusions of principal officers concerning controls and
procedures.
(a) As of July 22, 2008, an evaluation was performed
under the supervision and with the participation of the
officers of registrant, including the principal executive
officer (PEO) and principal financial officer (PFO), of the
effectiveness of registrant's disclosure controls and
procedures. Based on that evaluation, the registrant's
officers, including the PEO and PFO, concluded that, as of
July 22, 2008, the registrant's disclosure controls and
procedures were reasonably designed so as to ensure that
material information relating to the registrant is made
known to the PEO and PFO.
(b) There have been no significant changes in the
registrant's internal control over financial reporting (as
defined in Rule 30a-3(d) under the Investment Company Act of
1940 (17 CFR 270.30a-3(d)) that occurred during the
registrant's last fiscal half-year that has materially
affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
Item 12. Exhibits attached hereto. (Attach certifications as
exhibits)
(1) Not applicable. See registrant's response to Item 2,
above.
(2) Separate certifications by the registrant's principal
executive officer and principal financial officer, pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002 and
required by Rule 30a-2 under the Investment Company Act of
1940, are attached.
A certification by the registrant's principal executive
officer and principal financial officer, pursuant to Section
906 of the Sarbanes-Oxley Act of 2002, is attached.
Pursuant to the requirements of the Securities Exchange Act
of 1934 and the Investment Company Act of 1940, the
registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
THE ADAMS EXPRESS COMPANY
BY: /s/ Douglas G. Ober
-----------------------
Douglas G. Ober
Chief Executive Officer
(Principal Executive Officer)
Date: July 22, 2008
Pursuant to the requirements of the Securities Exchange Act
of 1934 and the Investment Company Act of 1940, this report
has been signed below by the following persons on behalf of
the registrant and in the capacities and on the dates
indicated.
BY: /s/ Douglas G. Ober
-----------------------
Douglas G. Ober
Chief Executive Officer
(Principal Executive Officer)
Date: July 22, 2008
BY: /s/ Maureen A. Jones
-----------------------
Maureen A. Jones
Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
Date: July 22, 2008