Microsoft’s proposed special dividend of $3 a share is subject to shareholder approval on Nov. 9, 2004. If it is approved, Dow Jones Indexes said that at the appropriate time, it will adjust the divisors of all its indexes in which Microsoft is a component¾including the Dow Jones Industrial Average.
Divisor adjustments nullify the effect on the index values of the stock price being lowered by the amount of the dividend, which happens on what traders call the “ex-date.” This is when the stock starts trading without the dividend payment. Microsoft said if it is approved by shareholders, the company will pay the dividend on Dec. 2, 2004, to holders of record Nov. 17, 2004. However, no ex-date was specified. When it is, Dow Jones Indexes said that it will apply the respective divisor changes then.
