SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
( ) Preliminary Proxy Statement ( ) Confidential, for Use of the
Commission Only (as permitted
by Rule 14a-6(e)(2))
(X) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
THE ADAMS EXPRESS COMPANY
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
( ) $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
( ) $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
(X) Fee paid previously with preliminary materials.
( ) Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule, or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
THE ADAMS EXPRESS COMPANY
Seven St. Paul Street
Baltimore, Maryland 21202
NOTICE OF ANNUAL MEETING
February 8, 1996
To the Stockholders of
THE ADAMS EXPRESS COMPANY:
Notice is hereby given that the Annual Meeting of Stockholders of THE ADAMS
EXPRESS COMPANY, a Maryland corporation (the "Company"), will be held at the
Hyatt Regency Westshore (Wilson's Plover Room, 14th floor), 6200 Courtney
Campbell Causeway, Tampa, Florida, on Tuesday, March 26, 1996, at 10:00 a.m.,
for the following purposes:
(a) to elect directors as identified in the Proxy Statement for the
ensuing year;
(b) to consider and vote upon the ratification of the selection of
Coopers & Lybrand L.L.P. as the firm of independent accountants to audit
the books and accounts of the Company for or during the year ending
December 31, 1996; and
(c) to consider and vote upon a proposed amendment to Article SIXTH of
the Articles of Incorporation to increase the number of authorized shares
of Common Stock of the Company from 50,000,000 shares to 75,000,000 shares;
and
(d) to transact such other business as may properly come before the
meeting.
Only stockholders of record, as shown by the transfer books of the Company
at the close of business on February 7, 1996, are entitled to notice of and to
vote at this meeting.
By order of the Board of Directors,
J. G. WHITNEY
Vice President and
Secretary
Baltimore, MD
NOTE: STOCKHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETING ARE REQUESTED TO
FILL IN, SIGN, DATE AND RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED ENVELOPE
WITHOUT DELAY.
<PAGE>
THE ADAMS EXPRESS COMPANY
Seven St. Paul Street
Baltimore, Maryland 21202
PROXY STATEMENT
February 8, 1996
The Annual Meeting of Stockholders of The Adams Express Company, a Maryland
corporation (the "Company"), will be held Tuesday, March 26, 1996, for the
purposes set forth in the accompanying Notice of Annual Meeting. This statement
is furnished in connection with the solicitation by the Board of Directors of
proxies to be used at such meeting and at any and all adjournments thereof and
is first being sent to stockholders on or about February 8, 1996. Any
stockholder executing and returning a proxy in the enclosed form has the power
to revoke such proxy at any time prior to the voting thereof by written notice
to the Company, by executing a later dated proxy or by appearing and voting at
the meeting.
At the Annual Meeting action is to be taken on (a) the election of a Board
of Directors; (b) the ratification of the selection of independent accountants;
(c) the approval of a proposed amendment to the Articles of Incorporation
increasing the authorized shares of Common Stock and (d) the transaction of such
other business as may properly come before the meeting.
All shares represented at the meeting by proxies in the accompanying form
will be voted provided that such proxies are properly signed. In cases where a
choice is indicated, the shares represented will be voted in accordance with the
specifications so made. In cases where no specifications are made, the shares
represented will be voted for the election of directors and for Proposals (b)
and (c) referred to above.
The Company will pay all costs of soliciting proxies in the accompanying
form. See "Other Matters" below. Solicitation will be made by mail, and officers
and regular employees of the Company may also solicit proxies by telephone or
personal interview. The Company expects to request brokers and nominees who hold
stock in their names to furnish this proxy material to their customers and to
solicit proxies from them, and will reimburse such brokers and nominees for
their out-of-pocket and reasonable clerical expenses in connection therewith.
SHARES OUTSTANDING AND ENTITLED TO BE VOTED AT MEETING
Only stockholders of record at the close of business February 7, 1996 may
vote at the Annual Meeting. The total number of shares of Common Stock of the
Company outstanding and entitled to be voted on the record date was 46,165,517.
Each share is entitled to one vote. The Company has no other class of security
outstanding. Directors shall be elected by a plurality of the votes cast at the
meeting. Proposal (b) referred to above requires the affirmative vote of a
majority of the votes cast at the meeting. Proposal (c) referred to above
requires the affirmative vote of a majority of all the votes entitled to be cast
at the meeting. Unless otherwise required by the Company's Articles of
Incorporation or By-laws, or by applicable Maryland law, any other matter
properly presented for a vote at the meeting will require the affirmative vote
of a majority of the votes cast at the meeting. Shares of Common Stock
represented by proxies which are marked "withhold authority" (with respect to
the election of any nominee for election as director) or marked abstain or which
constitute a broker non-vote will be counted as present at the meeting for
determining a quorum. (Broker non-votes occur when a nominee holding shares for
a beneficial owner has not received voting instructions from the beneficial
owner and such nominee does not possess or choose to exercise discretionary
authority with respect thereto.) With respect to any matter to be decided by a
plurality or
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<PAGE>
majority of the votes cast at the meeting, proxies marked "withhold authority"
(with respect to the election of any nominee for election as director) or marked
abstain or which constitute a broker non-vote will not be counted for the
purpose of determining the number of votes cast at the meeting, and therefore
will have no effect on any such vote. With respect to any matter to be decided
by a majority of all the votes entitled to be cast at the meeting, proxies
marked abstain or which constitute a broker non-vote will have the effect of a
negative vote.
As of December 31, 1995, no person or group of persons was known to own
beneficially more than 5 percent of the outstanding Common Stock of the Company.
(a) NOMINEES FOR ELECTION AS DIRECTORS
Unless contrary instructions are given by the stockholder signing a proxy,
it is intended that each proxy in the accompanying form will be voted at the
Annual Meeting for the election to the Board of Directors for the ensuing year
of the following nominees, all of whom have consented to serve if elected:
<TABLE>
<S> <C> <C>
Enrique R. Arzac Thomas H. Lenagh Douglas G. Ober
Leigh Carter W. D. MacCallan Landon Peters
Allan Comrie Augustine R. Marusi John J. Roberts
Daniel E. Emerson W. Perry Neff Robert J. M. Wilson
</TABLE>
If for any reason one or more of the nominees above named shall become
unable or unwilling to serve (which is not now expected) when the election
occurs, proxies in the accompanying form will, in the absence of contrary
instructions, be voted for the election of the other nominees above named and
may be voted for substitute nominees in the discretion of the persons named as
proxies in the accompanying form. The directors elected will serve until the
next annual meeting or until their successors are elected, except as otherwise
provided in the By-laws of the Company.
INFORMATION AS TO NOMINEES FOR ELECTION
AS DIRECTORS (AS OF DECEMBER 31, 1995)
Set forth below with respect to each nominee for director are his name and
age, any positions held with the Company, other principal occupations during the
past five years, other directorships and business affiliations, the year in
which he first became a director and the number of shares of Common Stock of the
Company beneficially owned by the director. Also set forth below is the number
of shares of Common Stock beneficially owned by all the directors and officers
of the Company as a group.
<TABLE>
<CAPTION>
Shares of
Common
Has Stock
been a Beneficially
Name, Age, Positions with the Company, Other Director Owned
Principal Occupations and Other Affiliations since (a)(b)(c)(d)(e)
<S> <C> <C>
Enrique R. Arzac, 54, Professor of Finance and Economics and Director of the Financial 1983 4,357
Management Program, formerly Vice Dean of Academic Affairs, of the Graduate School
of Business, Columbia University. Director of Petroleum & Resources Corporation*,
BEA Income Fund, Inc. and BEA Strategic Income Fund, Inc. (investment companies).
Leigh Carter, 70, Retired President and Chief Operating Officer of The BFGoodrich Co. 1982 2,196
(chemicals, plastics, aerospace), and Chairman of the Board of Tremco Inc.
(construction materials), Director of Centerior Energy Corp., Petroleum & Resources
Corporation, Sherwin-Williams Co. (paint), Armada Funds (investment company) and
Lamson & Sessions Co. (plastics).
Allan Comrie, 76, Formerly President and Chief Executive Officer of U.S. & Foreign 1987 4,861
Securities Corp. (investment company). Director of Petroleum & Resources
Corporation. Formerly a director of Japan Fund, Inc. (investment company) and
formerly a Trustee of Atlantic Mutual Companies (insurance).
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
Shares of
Common
Has Stock
been a Beneficially
Name, Age, Positions with the Company, Other Director Owned
Principal Occupations and Other Affiliations since (a)(b)(c)(d)(e)
<S> <C> <C>
Daniel E. Emerson, 71, Retired Executive Vice President of NYNEX Corp., retired Chairman 1982 3,304
of the Board of both NYNEX Information Resources Co. and NYNEX Mobile
Communications Co. Previously, Executive Vice President and Director of New York
Telephone Company. Presently, Chairman, National Board of Directors, YMCA of the
U.S.A. and a member of the Advisory Board of First Federal Savings and Loan
Association of Rochester. Director of Petroleum & Resources Corporation and
Clifford of Vermont (cable and wire distribution).
Thomas H. Lenagh, 77, Financial Advisor, formerly Chairman of the Board and Chief 1968 1,174
Executive Officer of Greiner Engineering Inc. (formerly Systems Planning Corp.)
(consultants), formerly financial advisor, Aspen Institute (research) and financial
advisor and prior thereto Treasurer of the Ford Foundation (charitable foundation).
Director of CML Group, Inc., Gintel Funds, Clemente Global Growth Fund, and
Petroleum & Resources Corporation (investment companies). Director of USLIFE Corp.,
ICN Pharmaceuticals, Inc., Irvine Sensors Corp. (engineering), Franklin Quest Co.
(seminar planning) and V-Band Corp. (telecommunications manufacturing).
W. D. MacCallan, 68, Retired Chairman of the Board and Chief Executive Officer of the 1971 98,280
Company. Director, former Chairman of the Board and Chief Executive Officer of
Petroleum & Resources Corporation. Formerly, consultant to the Company and
Petroleum & Resources Corp. Previously, Trustee of CBC Cornerstone Funds
(investment company). Director of the Hanover Funds, Inc. and the Hanover
Investment Funds, Inc. (investment companies).
Augustine R. Marusi, 82, Retired Chairman of the Board of Borden, Inc. (food and 1971 92,819
chemicals). Presently a Director of Petroleum & Resources Corporation.
W. Perry Neff, 68, Private Financial Consultant, Retired Executive Vice President of 1987 2,731
Chemical Bank. Previously, President of CBC Cornerstone Funds. Director of
Petroleum & Resources Corporation and North American Life Assurance Company.
Chairman of the Board and Director of both the Hanover Funds, Inc. and the Hanover
Investment Funds, Inc. (investment companies). Previously a Director of Van
Deventer & Hoch (investment company).
**Douglas G. Ober, 49, Chairman of the Board, Chief Executive Officer, and formerly Vice 1989 116,926
Chairman of the Board and Executive Vice President (1/1/89-4/1/91) of the Company.
Chairman of the Board, Chief Executive Officer and Director, and formerly Vice
Chairman of the Board and Executive Vice President of Petroleum & Resources
Corporation.
Landon Peters, 65, Private Investor, previously Investment Manager, Y.M.C.A. Retirement 1974 3,981
Fund. Formerly Executive Vice President and Treasurer and prior thereto Senior Vice
President and Treasurer of The Bank of New York. Director of Petroleum & Resources
Corporation.
John J. Roberts, 73, Vice-Chairman, External Affairs, American International Group, Inc. 1976 3,746
Formerly Chairman and Chief Executive Officer of American International
Underwriters Corporation (insurance). Previously President of American
International Underwriters Corporation-U.S./Overseas Operations. Director of
American International Group, Inc. and Petroleum & Resources Corporation.
Robert J. M. Wilson, 75, Retired President of the Company. Director and retired 1975 29,497
President of Petroleum & Resources Corporation.
Directors and Officers as a group. 717,857
</TABLE>
* Non-controlled affiliate of the Company.
** Mr. Ober is an "interested person" as defined by the Investment Company
Act of 1940, because he is an officer of the Company.
(a) To the Company's knowledge, each director and officer had sole
investment and sole voting power with respect to the shares shown opposite his
name, except Mr. Lenagh, who has only investment power,
3
<PAGE>
and other than (i) shares referred to in footnotes (b), (c) and (d) below, (ii)
1,135 shares shown for Mr. Peters, which were beneficially owned by his wife,
and as to which he had shared investment power but no voting power. Mr. Peters
disclaims beneficial ownership of the shares held by his wife. In addition,
77,500 shares shown for Mr. Marusi are held in a charitable remainder trust with
Merrill Lynch Trust Co. as co-trustee, as to which he disclaims beneficial
ownership.
(b) Of the amount shown, 13,888 shares beneficially owned by Mr. Ober were
held by the Trustee under the Employee Thrift Plan of the Company. The Trust
Agreement under such Plan provides that Plan participants have sole voting power
but no investment power with respect to such shares.
(c) Of the amount shown as beneficially owned by the directors and officers
as a group, 99,811 shares were held by the Trustee under the Employee Thrift
Plan.
(d) The amounts shown include shares subject to option under the Company's
Stock Option Plan (see "Stock Option Plan" below), by Mr. Ober (103,000 shares)
and directors and officers as a group (370,250 shares). Mr. Ober and the
officers with shares subject to option all disclaim beneficial ownership of
those shares.
(e) Calculated on the basis of 46,165,517 shares outstanding on December
31, 1995, each director owned less than 1.0% of the Common Stock outstanding.
The directors and officers as a group owned 1.55% of the Common Stock
outstanding.
The nominees for election as directors of the Company listed below are also
the nominees for election to the Board of Directors of Petroleum & Resources
Corporation ("Petroleum"), the Company's non-controlled affiliate, of which the
Company owned 1,145,570 shares or approximately 9.0% of the outstanding Common
Stock on December 31, 1995. Set forth below next to each nominee's name is the
number of shares of Petroleum beneficially owned by such nominee at December 31,
1995. Of these Petroleum shares, 5,123 were held by the Trustee of the Petroleum
Employee Thrift Plan for Mr. Ober, as to which he had sole voting and no
investment power and 55,250 shares are subject to option by Mr. Ober. Mr. Ober
disclaims beneficial ownership of these latter shares.
<TABLE>
<CAPTION>
Nominee Petroleum Shares Nominee Petroleum Shares
<S> <C> <C> <C>
Enrique R. Arzac 1,554 Augustine R. Marusi 13,200
Leigh Carter 1,116 W. Perry Neff 431
Allan Comrie 1,366 Douglas G. Ober 60,388
Daniel E. Emerson 1,217 Landon Peters 771
Thomas H. Lenagh 1,100 John J. Roberts 783
W. D. MacCallan 26,069 Robert J. M. Wilson 6,812
</TABLE>
Each director and officer of the Company who is subject to Section 16 of
the Securities Exchange Act of 1934 is required to report to the Securities and
Exchange Commission by a specified date his or her beneficial ownership of or
transactions in the Company's securities. The Company has no reason to believe
that any such directors and officers have not filed all requisite reports with
the Securities and Exchange Commission on a timely basis during 1995.
INFORMATION AS TO OTHER EXECUTIVE OFFICERS
Set forth below are the names, ages and positions with the Company and
Petroleum of all executive officers of the Company other than those who also
serve as directors. Executive officers serve as such until the election of their
successors.
4
<PAGE>
Ms. Maureen A. Jones, 48, has served as Treasurer (since January 1, 1993),
and prior thereto Assistant Treasurer (since April 1, 1991), of the Company and
Petroleum. From May 1, 1988 to March 31, 1991, she served as Assistant to the
Treasurer of the Company and Petroleum. Prior thereto, she was a senior auditor
with Coopers & Lybrand.
Mr. Richard F. Koloski, 51, has served as Executive Vice President of the
Company since January 1, 1986 and President of Petroleum since April 1, 1986.
Mr. Joseph M. Truta, 51, has served as President of the Company since April
1, 1986 and Executive Vice President of Petroleum since January 1, 1986.
Mr. J. G. Whitney, 54, has served as Vice President and Secretary of the
Company and Petroleum since October 1, 1984 and as Secretary of both since 1976.
<TABLE>
<CAPTION>
Shares of
Common Stock
Beneficially
Security Ownership of Management (a) Owned
Name (b) (c) (d) (e)
<S> <C>
Maureen A. Jones........................................................... 33,162
Richard F. Koloski......................................................... 111,560
Joseph M. Truta............................................................ 153,397
J. G. Whitney.............................................................. 55,866
</TABLE>
(a) Share ownership of directors and officers as a group is shown in the table
beginning on page 2 and footnotes thereto.
(b) To the Company's knowledge, each officer had sole investment and voting
power with respect to the shares shown opposite his or her name above other
than shares referred to in footnote (c) below.
(c) Of the amounts shown, the following shares beneficially owned by the
respective officer were held by the Trustee under the Employee Thrift Plan
of the Company: Ms. Jones (2,162 shares), Mr. Koloski (17,060 shares), Mr.
Truta (53,335 shares) and Mr. Whitney (13,366 shares). The Trust Agreement
under such plan provides that plan participants have sole voting power but
no investment power with respect to such shares.
(d) The amounts shown include shares subject to option under the Company's Stock
Option Plan (see "Stock Option Plan" below), by Ms. Jones (31,000 shares),
Mr. Koloski (94,500 shares), Mr. Truta (99,250 shares) and Mr. Whitney
(42,500 shares).
(e) Calculated on the basis of 46,165,517 shares of Common Stock outstanding on
December 31, 1995, each of the officers listed above owned less than 1.0% of
the Common Stock outstanding.
BOARD MEETINGS AND COMMITTEES OF THE BOARD
Overall attendance at the twelve meetings of the Board held in 1995 was
approximately 91%. All the Directors attended at least 75% of the total of all
meetings of the Board in 1995.
AUDIT COMMITTEE
Messrs. Arzac, Comrie, MacCallan and Marusi, none of whom is an "interested
person," constitute the membership of the Board's Audit Committee, which met
twice during 1995. The Audit Committee (1) recommends to the Board of Directors
the firm of independent accountants which is to be engaged to audit the books of
account and other corporate records of the Company, (2) reviews with the
independent
5
<PAGE>
accountants the scope of their audit with particular emphasis on the areas to
which either the Committee or the independent accountants believe special
attention should be directed, (3) reviews the recommendations of the independent
accountants regarding internal controls and other matters, and (4) makes
reports, whenever deemed advisable, to the Board of Directors with respect to
the internal control and accounting practices of the Company. The Audit
Committee also reviews the audit and non-audit fees of the independent
accountants.
EXECUTIVE COMMITTEE
Messrs. Carter, Emerson, Lenagh, Ober*, Neff, Peters and Wilson constitute
the membership of the Board's Executive Committee, which met three times during
1995. The Committee has the authority of the Board of Directors between meetings
of the Board except as limited by law, the Company's By-laws, or Board
resolution. The Executive Committee also performs the duties of a nominating
committee. It recommends to the full Board candidates for directorship. It is
the policy of the Executive Committee not to consider unsolicited nominations
for director.
COMPENSATION COMMITTEE
Messrs. Carter, Emerson, Lenagh, Neff and Peters constitute the membership
of the Board's Compensation Committee, which met once during 1995. The
Compensation Committee reviews and recommends changes in the salaries of
directors, executive officers, officers and employees, and advises upon the
compensation and stock option plans in which the executive officers, officers
and employees of the Company are eligible to participate.
BOARD OF DIRECTORS COMPENSATION
During 1995, each director who is not an interested person received an
annual retainer fee of $6,000 and a fee of $350 for each Board meeting attended.
All members of each Committee, except executive officers and/or interested
persons, receive an additional annual retainer fee of $1,500 for each committee
membership and a fee of $350 for each meeting attended, except the Compensation
Committee, the members of which only receive $350 for each meeting attended.
Messrs. Arzac, MacCallan, Neff and Wilson are the director members of the
Retirement Benefits Committee of the Company and Petroleum, which administers
the Employees' Retirement Plans, Supplemental Retirement Plans and the Employee
Thrift Plans of the Company and Petroleum. For this committee assignment these
directors receive an annual retainer fee of $1,500 and a fee of $350 for each
meeting attended. The total amount of fees paid to "disinterested person"
directors in 1995 was $147,450.
REMUNERATION OF DIRECTORS AND OTHERS
The following table sets forth for each of the persons named below the
aggregate current remuneration received from the Company and Petroleum during
the fiscal year ended December 31, 1995 for services in all capacities:
*Mr. Ober is an "interested person."
6
<PAGE>
<TABLE>
<CAPTION>
Pension or
Retirement Estimated
Benefits Accrued Annual
Aggregate During the Last Benefits upon
Name of Person, Position Remuneration (1) (2) (3) Fiscal Year (4) Retirement
<S> <C> <C> <C> <C>
Douglas G. Ober Chairman of the
Board and Chief
Executive Officer $ 304,708 -- $ 128,800
Joseph M. Truta President 209,840 -- 105,800
Richard F. Koloski Executive Vice
President 210,840 -- 106,150
Enrique R. Arzac Director (A)(D) 27,750 N/A N/A
Leigh Carter Director (B)(C) 25,550 N/A N/A
Allan Comrie Director (A) 24,100 N/A N/A
Morris D. Crawford, Jr.* Director (D) 13,100 N/A N/A
Daniel E. Emerson Director (B)(C) 25,500 N/A N/A
Thomas H. Lenagh Director (B)(C) 24,800 N/A N/A
W. D. MacCallan Director (A)(D) 28,450 N/A N/A
Augustine R. Marusi Director (A) 24,150 N/A N/A
W. Perry Neff Director (B)(C)(D) 29,150 N/A N/A
Landon Peters Director (B)(C) 24,850 N/A N/A
John J. Roberts Director 17,600 N/A N/A
Robert J. M. Wilson Director (B)(D) 29,900 N/A N/A
</TABLE>
* Mr Crawford resigned on June 8, 1995.
(A) Member of Audit Committee
(B) Member of Executive Committee
(C) Member of Compensation Committee
(D) Member of Retirement Benefits Committee
(1) Of the amounts shown, direct salaries paid by the Company to Messrs.
Ober, Truta and Koloski were $144,200, $92,400 and $92,400, respectively. Of the
amounts shown, Petroleum paid non-deferred salaries to Mr. Ober, $58,092, Mr.
Truta, $37,224 and Mr. Koloski, $37,224. Of the amounts shown, $3,708 for Mr.
Ober, $2,376 for Mr. Truta and $2,376 for Mr. Koloski, was deferred compensation
under the Employee Thrift Plan paid by Petroleum for the respective employee's
account. Of the Company's direct salaries, $5,532 for Mr. Ober, $5,544 for Mr.
Truta and $5,544 for Mr. Koloski, was deferred compensation under the Company's
Employee Thrift Plan. The non-employee Directors do not participate in either
Thrift Plan.
(2) The Company and Petroleum each offer an Employee Thrift Plan (see
"Employee Thrift Plan" page 9) to their respective employees under which
contributions are made to match the contributions made by eligible employees and
each paid bonuses to certain officers. Of the amounts shown, $69,092, $54,488
and $55,188 were bonuses and/or plan contributions for Messrs. Ober, Truta and
Koloski, respectively. Petroleum made contributions and/or paid bonuses of
$29,616 for Mr. Ober, $23,352 for Mr. Truta and $23,652 for Mr. Koloski,
respectively. The non-employee Directors do not receive bonuses from either
company.
(3) Of the amounts shown for non-employee Directors, exactly one-half was
paid by Petroleum.
(4) The Company and Petroleum each have a noncontributory Employees'
Retirement Plan. No contributions were made by the Company or Petroleum to its
respective plan in 1995.
7
<PAGE>
STOCK OPTION PLAN
On December 12, 1985, the Company's Board of Directors adopted a Stock
Option Plan (the "Plan"), which was approved by the stockholders at the March
26, 1986 Annual Meeting of Stockholders and amended at the March 29, 1994 Annual
Meeting of Stockholders. The Plan provides for the grant to "key employees" (as
defined in the Plan) of options to purchase an aggregate maximum of 2,050,000
shares of Common Stock of the Company, together with related stock appreciation
rights, of which (i) 850,000 shares may be made subject to options granted
between December 12, 1985 and December 11, 1995, and (ii) 1,200,000 shares may
be made subject to options granted between December 9, 1993 and December 8,
2003. All options granted or to be granted under the Plan currently will be
treated as non-qualified stock options under the Internal Revenue Code. The Plan
is administered by the Compensation Committee of the Board of Directors which
consists of five members of the Board, none of whom is eligible to receive
grants under the Plan. The grant of options is at the discretion of the
Compensation Committee.
The Plan provides that, among other things, (a) the option price per share
shall not be less than the fair market value of the Common Stock at the date of
grant, except that the option price per share will be reduced after grant of the
option to reflect capital gain distributions to the Company's stockholders,
provided that no such reduction shall be made which will reduce the option price
below 25% of the original option price, (b) an option will not become
exercisable until the optionee shall have remained in the employ of the Company
for at least one year after the date of grant and may be exercised for 10 years
unless an earlier expiration date is stated in the option and (c) no option or
stock appreciation right shall be granted after December 8, 2003.
The Plan permits the grant of stock appreciation rights in conjunction with
the grant of an option, either at the time of the option grant or thereafter
during its term and in respect of all or part of such option. Stock appreciation
rights permit an optionee to request to receive (a) shares of Common Stock of
the Company with a fair market value, at the time of exercise, equal to the
amount by which the fair market value of all shares subject to the option in
respect of which such stock appreciation right was granted exceeds the exercise
price of such option, (b) in lieu of such shares, the fair market value thereof
in cash, or (c) a combination of shares and cash. Stock appreciation rights are
exercisable beginning no earlier than two years after the date of grant and
extend over the period during which the related option is exercisable. To the
extent a stock appreciation right is exercised in whole or in part, the option
in respect of which such stock appreciation right was granted shall terminate
and cease to be exercisable.
No disposition of shares of Common Stock acquired as the result of the
exercise of an option or stock appreciation right may be made within the later
of two years of the date of grant of the option and one year of the acquisition
of such shares.
8
<PAGE>
The following tabulation shows as to the executive officers of the Company
named in the table set forth on page 7 and as to executive officers of the
Company as a group (i) the number of shares subject to options granted during
the period January 1, 1995 through December 31, 1995 and the per share option
exercise price thereof; and (ii) the net value of shares (market value less
exercise price) or cash realized during such period upon the exercise of options
or stock appreciation rights.
<TABLE>
<CAPTION>
All executive
Douglas Joseph Richard officers as
Common Stock G. Ober M. Truta F. Koloski a group
<S> <C> <C> <C> <C>
Nonqualified stock options with stock appreciation rights:
Granted -- January 1, 1995 through December 31, 1995....... 24,000 19,000 18,000 80,000
Share exercise price....................................... $18.4375 $18.4375 $18.4375 $ 18.4375
Exercised -- Net value realized in shares (market
value less exercise price) or cash:
January 1, 1995 through December 31, 1995............... $76,850 $ -0- $87,838 $ 208,137
</TABLE>
EMPLOYEE THRIFT PLAN
Employees of the Company who have completed six months of service may elect
to have 2% to 6% of their base salary deferred as a contribution to a thrift
plan instead of being paid to them currently (see table set forth on page 7
regarding 1995 contributions for the officers and directors identified therein).
The Company (subject to certain limitations) contributes for each employee out
of net investment income an amount equal to 200% of each employee's contribution
or to the maximum permitted by law. Employees may also contribute an additional
10% of base salary to the thrift plan, but these post-tax contributions are not
matched by the Company. All employee contributions are credited to the
employee's individual account. Employees may elect that their salary deferral
and other contributions be invested in a fixed income fund, intermediate bond
fund, Common Stock of the Company or of Petroleum or a combination of the four.
The Company's contributions are invested entirely in its Common Stock. An
employee's interest in amounts derived from the Company's contributions becomes
non-forfeitable upon completion of 60 months of service or upon death or
retirement. Payments of amounts not withdrawn or forfeited under the thrift plan
may be made upon retirement or other termination of employment in a single
distribution, in ten equal installments, or in an annuity
EMPLOYEES' RETIREMENT PLAN
The respective employees of the Company and Petroleum with one or more
years of service participate in similar retirement plans pursuant to which
contributions are made solely by the respective employers on behalf of, and
benefits are provided for, employees meeting certain age and service
requirements. The plans provide for the payment of benefits in the event of an
employee's retirement at age 62 or older. Upon such retirement, the amount of
the retirement benefit is 2% of an employee's final thirty-six months average
annual salary including bonuses, multiplied by years of service. Retirement
benefits cannot exceed 55% of the final thirty-six months average annual salary
including bonuses. The criteria for calculation of retirement benefits under
Petroleum's plan are the same. Benefits are payable in several alternative
methods, each of which must be the actuarial equivalent of a pension payable for
the life of the employee only. Retirement benefits (subject to any applicable
reduction) are also payable in the event of an employee's early or deferred
retirement, disability or death.
On March 10, 1988, the Board of Directors of each of the Company and
Petroleum unanimously approved a supplemental retirement benefits plan
(together, the "Supplemental Plans") for employees of the Company or Petroleum,
as the case may be. The purpose of each of the Supplemental Plans is to
9
<PAGE>
provide deferred compensation in excess of benefit limitations imposed by the
Internal Revenue Code on tax-qualified defined benefit plans, including the
retirement plans of the Company and Petroleum described above. In accordance
with such limitations, the annual benefit payable under each retirement plan may
not exceed the lesser of $120,000 for 1996 and the employee's average total
compensation paid during the three highest-paid consecutive calendar years of
employment. The $120,000 limit will be adjusted annually by the Secretary of the
Treasury to reflect cost-of-living increases. In addition, the Internal Revenue
Code limits the amount of benefits payable to beneficiaries of the tax-qualified
retirement plan of each of the Company and Petroleum who are also participants
in the respective employee thrift plan of the Company or Petroleum, as the case
may be, if the combination of projected annual retirement benefits under such
retirement plan and annual contributions under such employee thrift plan exceeds
certain limits.
The Supplemental Plans authorize the Company or Petroleum, as the case may
be, to pay annual retirement benefits under its respective retirement plan in an
amount equal to the difference between the maximum benefits payable under such
retirement plan and the benefits that would otherwise be payable but for the
Internal Revenue Code's limitations on annual retirement benefits. All amounts
payable under the Supplemental Plans will be paid from the general funds of the
responsible company as benefits become due and neither the Company nor Petroleum
will establish a trust or other funding vehicle for its Supplemental Plan.
Payment of benefits under the Supplemental Plans will be made concurrently with
and in the same form as payment of benefits under the related retirement plan.
During 1995, the Company and Petroleum made payments of $18,844.08 and
$15,467.40 under their respective Supplemental Plans.
BROKERAGE COMMISSIONS
During the past fiscal year the Company paid brokerage commissions on the
purchase and sale of portfolio securities in the amount of $761,154,
substantially all of which were paid to brokers providing research and other
investment services to the Company. The average per share commission rate paid
by the Company was $0.0610. No commissions were paid to an affiliated broker.
PORTFOLIO TURNOVER
Portfolio turnover rate (purchases or sales, whichever is lower, as a
percentage of weighted average portfolio value) for the past three years has
been as follows:
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C>
23.98% 19.23% 21.40%
</TABLE>
(b) RATIFICATION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Investment Company Act of 1940 (the "Act") requires, in effect, that
the Company's independent accountants be selected by a majority of the members
of the Board of Directors who are not "interested persons" (as defined by the
Act) of the Company; that such selection be submitted for ratification or
rejection at the annual meeting of stockholders; and that the employment of such
independent accountants be conditioned on the right of the Company by vote of
the holders of a majority of its outstanding voting securities to terminate such
employment at any time without penalty. In accordance with such provisions,
Coopers & Lybrand L.L.P., 217 E. Redwood Street, Baltimore, Maryland,
independent accountants, which firm was the Company's principal auditor during
the year 1995, has been selected as independent accountants of the Company to
audit the books and accounts of the Company for or during the year ending
December 31, 1996 by a majority of those members of the Board of Directors who
were not "interested persons" of the Company voting in person, and their
selection is submitted to the stockholders for ratification by the affirmative
vote of a majority of all the votes cast at the meeting. Representatives of
Coopers & Lybrand L.L.P. are expected to be present at such meeting to make a
statement if they desire
10
<PAGE>
to do so and they are expected to be available to respond to appropriate
questions. Coopers & Lybrand L.L.P. does not have any direct financial or any
material indirect financial interest in the Company.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS RATIFICATION OF THE SELECTION
OF COOPERS & LYBRAND L.L.P.
(c) APPROVAL OF A PROPOSED AMENDMENT TO ARTICLE SIXTH OF THE ARTICLES OF
INCORPORATION TO INCREASE AUTHORIZED COMMON STOCK
It is proposed that the Articles of Incorporation be amended to increase
the number of authorized shares of Common Stock from 50,000,000 shares to
75,000,000 shares. This increase would be effected by amending the first
paragraph of Article SIXTH so that it will read "The total number of shares of
stock which the Corporation shall have authority to issue is 85,000,000 shares
with an aggregate par value of $75,000,000, divided into two classes consisting
of (a) 75,000,000 shares of Common Stock, par value $1.00 per share, and (b)
10,000,000 shares of Preferred Stock, without par value." Of the 50,000,000
shares of Common Stock currently authorized, as of January 1, 1996, 46,165,517
shares were outstanding, and 1,460,626 shares were reserved for issuance under
the Company's stock option plan. The additional shares of Common Stock that
would be authorized by the proposed amendment would have the same rights and
privileges and otherwise be identical to the shares of Common Stock currently
authorized and outstanding. The proposal to be adopted will require the
affirmative vote of a majority of all the votes entitled to be cast thereon,
being a majority of the issued and outstanding shares of Common Stock. If the
proposal is adopted, the Company shall cause Articles of Amendment to the
Articles of Incorporation, substantially in the form of Exhibit A attached
hereto, to be filed with the State Department of Assessments and Taxation of the
State of Maryland. If the proposal is not adopted, it may be resubmitted to the
stockholders at future meetings.
The Board of Directors recommends the adoption of this proposal. If it is
adopted, additional shares of authorized and unissued Common Stock will be
provided which can be issued, without further stockholder approval, by the Board
of Directors, for the payment of dividends and capital gain distributions to the
holders of the Common Stock or, subject to the requirements of the Investment
Company Act of 1940, for such other proper corporate purposes as may be deemed
desirable by the Board of Directors (including for use in connection with the
issuance of any future class of convertible equity security of the Company or in
connection with the Company's stock option plan). The Board of Directors does
not have any present plans to issue additional shares of Common Stock other than
for payment of dividends and capital gain distributions, and if required
pursuant to the stock option plan. However, the Board of Directors, as it has in
the past, may propose the issuance of a Convertible Preferred Stock as a means
to fulfill a merger agreement, which would require setting aside a specific
number of common shares to meet the convertible provisions. Holders of the
Company's shares have no preemptive rights and, as a result, existing
stockholders would not have any preferential right to purchase any of the
additional shares of Common Stock if and when issued.
Although the Board of Directors presently has no plans to do so, the
additional shares of Common Stock could, subject to the applicable laws and
rules, be sold in a public offering. If such an offering occurred, there could,
depending upon a variety of factors, including the rate of return achieved on
the investment of the proceeds of any such offering, be a dilution of the net
income per share of the outstanding Common Stock. Such an offering would also
involve a dilution in the voting rights of the outstanding Common Stock.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE ADOPTION OF
THE PROPOSED AMENDMENT.
11
<PAGE>
(d) OTHER MATTERS AND ANNUAL REPORT
As of the date of this proxy statement management knows of no other
business that will come before the meeting. Should other business be properly
brought up, it is intended that proxies in the accompanying form will be voted
thereon in accordance with the judgment of the person or persons voting such
proxies.
The Annual Report of the Company for the year ended December 31, 1995,
including financial statements, has been mailed to all stockholders entitled to
notice of and to vote at the annual meeting to be held on March 26, 1996. If you
did not receive a copy, you may request one by telephoning J. G. Whitney, Vice
President and Secretary, at (800) 638-2479.
The Company has retained Corporate Investor Communications, Inc. ("CIC") to
assist in the solicitation of proxies. The Company will pay CIC a fee for its
services not to exceed $5,500 and will reimburse CIC for its expenses, which the
Company estimates will not exceed $2,500.
(e) STOCKHOLDER PROPOSALS
Stockholder proposals for inclusion in the proxy statement and form of
proxy relating to the 1997 Annual Meeting must be received at the office of the
Company, Seven St. Paul Street, Baltimore, MD 21202, no later than October 11,
1996.
12
<PAGE>
EXHIBIT A
ARTICLES OF AMENDMENT
TO
ARTICLES OF INCORPORATION
OF
THE ADAMS EXPRESS COMPANY
THE ADAMS EXPRESS COMPANY, a Maryland corporation having its principal
office in Baltimore City, Maryland (hereinafter called the "Corporation"),
hereby certifies to the State Department of Assessments and Taxation of Maryland
that:
FIRST: The Articles of Incorporation of the Corporation are hereby amended
by striking out the first paragraph of Article SIXTH thereof, as heretofore
amended, and inserting in lieu thereof the following:
"SIXTH: The total number of shares of stock which the Corporation
shall have authority to issue is 85,000,000 shares with an aggregate par
value of $75,000,000, divided into two classes consisting of (a) 75,000,000
shares of Common Stock of the par value of $1 each and of the aggregate par
value of $75,000,000 and (b) 10,000,000 shares of Preferred Stock without
par value."
SECOND: The Board of Directors of the Corporation at a meeting duly
convened and held on January 16, 1996 adopted a resolution in which was set
forth the foregoing amendment of the Articles of Incorporation, declaring that
said amendment was advisable and directing that it be submitted for action
thereon at the annual meeting of the stockholders of the Corporation to be held
on March 26, 1996.
THIRD: Notice setting forth the said amendment of the Articles of
Incorporation and stating that a purpose of the annual meeting of stockholders
would be to take action thereon was given, as required by law, to all
stockholders entitled to vote thereon.
FOURTH: The amendment of the Articles of Incorporation of the Corporation
as hereinabove set forth was approved by the stockholders of the Corporation at
said meeting by the affirmative vote of a majority of all the votes entitled to
be cast thereon.
FIFTH: The amendment of the Articles of Incorporation as hereinabove set
forth has been duly advised by the Board of Directors and approved by the
stockholders of the Corporation.
SIXTH: (a) The total number of shares of all classes of stock of the
Corporation heretofore authorized by Article SIXTH of the Articles of
Incorporation of the Corporation is 55,000,000 shares, consisting of 50,000,000
shares of Common Stock of the par value of $1 per share, amounting in the
aggregate to $50,000,000 par value and 10,000,000 shares of Preferred Stock
without par value.
(b) The total number of shares of all classes of stock of the Corporation,
as increased by the foregoing amendment to said Article SIXTH, is 85,000,000
shares amounting in the aggregate to $75,000,000 par value, divided into
75,000,000 shares of Common Stock of the par value of $1 per share, having an
aggregate par value of $75,000,000 and 10,000,000 shares of Preferred Stock
without par value.
(c) The amendment of the Articles of Incorporation of the Corporation as
hereinabove set forth did not change the description, contained in the Articles
of Incorporation, of any class of shares of the Corporation, including the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications, and terms and conditions of
redemption thereof, if any.
IN WITNESS WHEREOF, The Adams Express Company has caused these presents to
be signed in its name and on its behalf by its President or one of its Vice
Presidents and its corporate seal to be hereunto
A-1
<PAGE>
affixed and attested by its Secretary, and the said officers of the Corporation
further acknowledged said instrument to be the corporate act of the Corporation
and stated under the penalties of perjury that to the best of their knowledge,
information and belief, the matters and facts therein set forth with respect to
the approval thereof are true in all material respects on March , 1996.
ATTEST: THE ADAMS EXPRESS COMPANY
By
A-2
<PAGE>
THE ADAMS EXPRESS COMPANY-PROXY FOR 1996 ANNUAL MEETING
Solicited by the Board of Directors
The undersigned hereby appoints THOMAS H. LENAGH, W. D. MacCALLAN and
AUGUSTINE R. MARUSI, or any of them, with power of substitution, proxies
of the undersigned to vote at the Annual Meeting (including
adjournments) of Stockholders of The Adams Express Company on March 26,
1996, at 10:00 a.m., at the Hyatt Regency Westshore, Wilson's Plover
Room, 14th Floor, 6200 Courtney Campbell Causeway, Tampa, Florida.
If a choice is not specified, this proxy is to be voted FOR the election
of directors and FOR proposals (b) and (c).
To vote in accordance with the Board of Directors' recommendations, just
sign the reverse side, no boxes need to be checked.
The undersigned hereby acknowledges receipt of the Notice of Annual
Meeting dated February 8, 1996 and the Proxy Statement furnished
therewith.
(Continued and to be signed and dated on other side)
THE ADAMS EXPRESS COMPANY
P.O. BOX 11147
NEW YORK, N.Y. 10203-0147
<PAGE>
<TABLE>
<S> <C> <C> <C>
(a) ELECTION OF DIRECTORS FOR all nominees [X] WITHHOLD AUTHORITY to vote [X] *EXCEPTIONS [X]
listed below for all nominees listed below
</TABLE>
Nominees: E. R. Arzac, L. Carter, A. Comrie, D. E. Emerson, T. H. Lenagh,
W. D. MacCallan, A. R. Marusi, W. P. Neff, D. G. Ober, L. Peters,
J. J. Roberts, R. J. M. Wilson
(INSTRUCTIONS: To withhold authority to vote for any individual nominee,
mark the "Exceptions" box and write that nominee's name in the space
provided below.)
*Exceptions__________________________________________________________________
<TABLE>
<S> <C>
(b) THE SELECTION OF COOPERS & LYBRAND L.L.P. as independent public (c) THE APPROVAL OF AN AMENDMENT TO ARTICLE SIXTH of the
accountants. Articles of Incorporation to increase the number of
authorized shares of Common Stock from 50,000,000
shares to 75,000,000 shares.
FOR [X] AGAINST [X] ABSTAIN [X] FOR [X] AGAINST [X] ABSTAIN [X]
</TABLE>
(d) In their discretion, the Proxies are authorized to vote upon all
other business that may properly come before the Meeting with all the
powers the undersigned would possess if personally present.
<TABLE>
<S> <C>
THE BOARD OF DIRECTORS RECOMMENDS VOTES FOR: PROPOSALS (A), (B) AND (C). Change of Address or
</TABLE>
<TABLE>
<S> <C>
Comments Mark Here [X]
NOTE: The signature(s) should correspond with the
name of the stockholder(s) as it appears hereon.
Dated: ____________________________________ ,1996
Signature _______________________________________
Joint Tenant ____________________________________
Sign, Date and Return the Proxy Card Promptly Using the Enclosed Envelope. Votes must be indicated
(x) in Black or Blue ink. [X]
</TABLE>
