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Exhibit
10.4
DOW JONES 1998 STOCK OPTION
PLAN
1. Purpose. The purpose of this Plan is
to provide a means whereby Dow Jones & Company, Inc. (the
“Company”) may, through the grant of options to
purchase Common Stock of the Company to employees of the Company
and of any Subsidiary, attract and retain persons of ability as key
employees (including officers and directors who are also employees)
and motivate such employees to exert their best efforts on behalf
of the Company and any Subsidiary. When used in the Plan with
reference to employment, the term “Company” shall
include Subsidiaries of the Company. As used herein the term
“Subsidiary” shall mean any legal entity 50% or more of
the voting equity of which is owned or controlled directly or
indirectly by the Company.
2. Shares Subject to the Plan. Options
may be granted by the Company from time to time to key employees of
the Company to purchase shares of Common Stock ($1.00 par value) of
the Company (“Common Stock”), and may be either
authorized and unissued or held by the Company in its treasury. The
maximum number of shares of Common Stock with respect to which
options may be granted under the Plan shall be 3,000,000 shares,
subject to adjustment as provided in Section 4(h). If any
option granted under the Plan shall terminate, expire or, with the
consent of the optionee, be canceled, new options may thereafter be
granted covering such shares. Anything contained herein to the
contrary notwithstanding, the aggregate number of shares of Common
Stock with respect to which options may be granted during any
calendar year to any individual shall be limited to
200,000.
3. Administration of the Plan. The Plan
shall be administered by the Compensation Committee (the
“Committee”) consisting of not less than two members
appointed by the Board of Directors of the Company. Each member of
the Committee shall be a member of the Board who qualifies both as
an “outside director” within the meaning of
Section 162(m) of the Internal Revenue Code of 1986, as
amended from time to time (the “Code”), and as a
“non-employee director” within the meaning of Rule
16b-3 under the Securities Exchange Act of 1934. Any vacancy
occurring in the membership of the Committee shall be filled by
appointment of the Board.
Subject to the provisions of the Plan,
the Committee shall have the power to:
(a) determine and designate from time to
time those employees of the Company to whom options are to be
granted and the number of shares to be optioned to each such
employee;
(b) authorize the granting of options
which qualify as incentive stock options within the meaning of
Section 422 of the Code (“Incentive Stock
Options”), and options which do not qualify as Incentive
Stock Options, both of which are referred to herein as
options;
(c) determine the number of shares
subject to each option;
(d) determine the time or times and the
manner when each option shall be exercisable and the duration of
the exercise period, which period shall in no event exceed ten
years (or five years as specified in Section 4(m) hereof) from
the date the option is granted;
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(e) extend the term of an option
(including extension by reason of an optionee’s death,
permanent disability or retirement) but not beyond ten years (or
five years as specified in Section 4(m) hereof) from the date
of the grant; and
(f) cancel all or any portion of any
option as provided in Section 4(k).
No director of the Company who is not
also an employee of the Company shall be entitled to receive any
option under the Plan.
The Committee may interpret the Plan,
prescribe, amend and rescind any rules and regulations necessary or
appropriate for the administration of the Plan, and make such other
determinations and take such other action as it deems necessary or
advisable, except as otherwise expressly reserved to the Board of
Directors of the Company in the Plan. Without limiting the
generality of the foregoing sentence, the Committee may, in its
discretion, treat all or any portion of any period during which an
optionee is on military or on an approved leave of absence from the
Company as a period of employment of such optionee by the Company
for purposes of accrual of his or her rights under his or her
option; provided, however, that no option may be granted to an
employee while he or she is on a leave of absence. Any
interpretation, determination or other action made or taken by the
Committee shall be final, binding and conclusive.
4. Terms and Conditions of Options. Each
option granted under the Plan shall be evidenced by an agreement,
in form approved by the Committee, which shall be subject to the
following express terms and conditions and to such other terms and
conditions as the Committee may deem appropriate:
(a) Option Period. Each option agreement
shall specify the period for which the option thereunder is granted
(which in no event shall exceed ten years (or five years as
specified in Section 4(m) hereof) from the date of grant) and
shall provide that the option shall expire at the end of such
period.
(b) Option Price. The option price per
share shall be determined by the Committee at the time any option
is granted, and shall be not less than the fair market value (but
in no event less than the par value) of the Common Stock of the
Company on the date the option is granted, as determined by the
Committee.
(c) Exercise of Option. No part of any
option may be exercised until the optionee shall have remained in
the employ of the Company for such period after the date on which
the option is granted as the Committee may specify in the option
agreement.
(d) Payment of Purchase Price upon
Exercise. The purchase price of the shares as to which an option
shall be exercised shall be paid to the Company at the time of
exercise either (i) in cash (including the proceeds of a
“cashless exercise” with the assistance of a broker),
or (ii) by delivering Common Stock of the Company already
owned by the optionee and having a total fair market value on the
date of such delivery equal to the purchase price, or (iii) by
delivering a combination of cash and Common Stock of the Company
having a total fair market value on the date of such delivery equal
to the purchase price.
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(e) Exercise in the Event of Death or
Termination of Employment. (1) If an optionee’s
employment by the Company shall terminate because of his or her
death, retirement or permanent disability, his or her option may be
exercised, to the extent provided in the option agreement, by him
or her or by the person or persons to whom the optionee’s
rights under the option pass by designation pursuant to
Section 5, or, absent a designation, by will or applicable
law, or if no such person has such right, by the executor or
administrator of his or her estate, at any time, or from time to
time, but not later than the earlier of (i) the expiration
date specified pursuant to paragraph (a) of this
Section 4 or (ii) the expiration of the period, if any,
prescribed in the agreement for such an exercise. (2) If an
optionee’s employment shall terminate for any reason other
than death, permanent disability or retirement, all right to
exercise his or her option shall terminate at the date of such
termination of employment.
(f) Transferability of Options. No
option granted under the Plan shall be transferable other than by
will or by the laws of descent and distribution. During the
lifetime of the optionee an option shall be exercisable only by him
or her.
(g) Investment Representation. Upon
demand by the Committee, the optionee (or any person acting under
Section 4(e)) shall deliver to the Committee at the time of
any exercise of an option a written representation that the shares
to be acquired upon such exercise are to be acquired for investment
and not for resale or with a view to the distribution thereof. Upon
such demand, delivery of such representation prior to the delivery
of any shares issued upon exercise of an option and prior to the
expiration of the option period shall be a condition precedent to
the right of the optionee or such other person to purchase any
shares (and each option agreement shall contain an undertaking to
deliver such a representation).
(h) Adjustment Upon Certain
Changes
(1) Increase or Decrease
in Issued Shares Without Consideration
Subject to any required
action by the shareholders of the Company, in the event of any
increase or decrease in the number of issued shares of Common Stock
resulting from a subdivision or consolidation of shares of Common
Stock or the payment of a stock dividend (but only on the shares of
Common Stock), or any other increase or decrease in the number of
such shares effected without receipt or payment of consideration by
the Company, the Committee shall adjust the number and kind of
shares subject to outstanding options and the exercise price per
share under such options, in order to preserve the economic value
thereof.
(2) Certain
Mergers
Subject to any required
action by the shareholders of the Company, in the event that the
Company shall
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