UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 21, 2005 (June 15, 2005)
DOW JONES & COMPANY, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-7564 13-5034940
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
200 Liberty Street, New York, New York 10281
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 416-2000
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
Director Fees
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At a meeting on June 14, 2005, the Corporate Governance Committee
recommended and on June 15, 2005, the Board approved an increase in the
fees paid to directors equal to $3,750 per quarter in deferred stock units.
Effective July 1, 2005, non-employee directors will receive an annual
retainer of $115,000 (comprised of a $30,000 cash component and an $85,000
deferred stock equivalent unit component). As a result, for the remaining
two quarters of 2005, non-employee directors will be credited with $21,250
instead of $17,500 of stock equivalents per quarter while cash compensation
will remain at $7,500 per quarter.
Executive Officer Annual and Long-Term Incentive Compensation
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At a meeting on June 15, 2005, the Compensation Committee approved and will
recommend to the Board certain changes to the criteria for determining
annual and long-term incentive compensation (including for the chief
executive officer and the other four executive officers whose compensation
must be detailed in the proxy statement ("named executive officers")).
Annual Incentive Compensation
For 2005, a substantial portion of the named executive officers' annual
incentive compensation is based on the achievement of pre-established
financial objectives and the balance is based on the achievement of
strategic goals and, for certain executive officers, individual
performance. The Compensation Committee has retained some measure of
discretion because it believed that it is difficult to forecast in detail
all future developments that will be relevant to an evaluation of executive
performance.
Starting in 2006, assuming approval of the Compensation Committee's
recommendation by the Board and approval by the Company's stockholders, the
annual incentive compensation of the named executive officers will be based
on certain yet to be determined objective performance criteria. As the
initial step, a bonus pool would be created for the executives who have a
reasonable chance of being one of the named executive officers. The funding
of the pool would be based on Company performance with respect to one or more
pre-established objective measures. The Compensation Committee would retain
downward discretion to set the final payout from the pool.
Long-Term Incentive Compensation
In 2005, initial awards of contingent stock rights were made under the
Company's long-term incentive plan to the named executive officers for the
performance period 2005-2007. When these grants were made, it was expected
that the final awards to all those receiving these grants would be based
solely on the Company's performance with respect to total shareholder
return relative to an established group of newspaper and information
services companies. However, the Compensation Committee retained the
discretion to adjust awards - up or down - as they deemed fit.
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The Committee has determined beginning with the 2006-2008 performance
period, to forgo the right to exercise any discretion in determining the
final awards. As a result, final awards for the 2006-2008 performance
period as well as those going forward will be based solely on relative
total shareholder return.
Tax Consequences
Federal tax legislation eliminates the deductibility of compensation in
excess of $1,000,000 paid to any one of the named executive officers. The
law exempts, under Section 162(m), compensation paid under qualifying plans
that relate compensation to performance. The changes recommended by the
Compensation Committee will permit the Company to deduct, for federal
income tax purposes, certain compensation over $1,000,000 paid to certain
named executive officers.
ITEM 5.02. DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF
DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS.
At a board meeting on June 15, 2005, John Engler was appointed to the Audit
Committee effective as of such date.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DOW JONES & COMPANY, INC.
Dated: June 21, 2005 By: /s/ Robert Perrine
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Robert Perrine
Chief Accounting
Officer and Controller