<PAGE>
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
DOW JONES & COMPANY, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] 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:
-------------------------------------------------------------------------
[_] 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:
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Notes:
<PAGE>
[LOGO DOW JONES] Notice of 1999
Annual Meeting and
Proxy Statement
Dow Jones & Company
<PAGE>
Dow Jones & Company, Inc.
200 Liberty Street, New York, New York 10281
To Our Stockholders:
You are cordially invited to attend the 1999 Annual Meeting of Stockholders of
Dow Jones & Company, Inc., which will be held on Wednesday, April 21, 1999 at
11:00 a.m. at:
Windows on the World--106th Floor
One World Trade Center
New York, New York
Discussions of Company affairs at past Annual Meetings have generally been in-
teresting and useful. I hope you will be able to attend.
This year, you are being asked to act upon the election of five directors, the
approval of the appointment of PricewaterhouseCoopers LLP and two stockholder
proposals. These matters are discussed in greater detail in the accompanying
proxy statement.
The Board of Directors recommends a vote FOR the election of directors, FOR
the approval of the appointment of PricewaterhouseCoopers LLP and AGAINST each
of the two stockholder proposals.
Regardless of the number of shares you own and whether or not you plan to at-
tend, it is important that your shares are represented and voted at the meet-
ing. You are requested to sign, date and return the enclosed proxy promptly.
If you do attend the Annual Meeting, you may still vote in person if you so
desire.
Sincerely yours,
/s/ Peter R. Kann
Peter R. Kann
Chairman of the Board
March 22, 1999
<PAGE>
Dow Jones & Company, Inc.
200 Liberty Street, New York, New York 10281
Notice of 1999 Annual Meeting of Stockholders
to be held Wednesday, April 21, 1999
To the Stockholders of
DOW JONES & COMPANY, INC.
NOTICE IS HEREBY GIVEN that the 1999 Annual Meeting of Stockholders of Dow
Jones & Company, Inc. will be held at Windows on the World--106th Floor, One
World Trade Center, New York, New York on Wednesday, April 21, 1999 at 11:00
a.m. for the purposes of:
1. Electing five directors to hold office until 2002;
2. Approving the appointment of PricewaterhouseCoopers LLP, independent cer-
tified public accountants, as auditors for 1999;
3. Acting upon a stockholder proposal to establish cumulative voting in the
election of directors;
4. Acting upon a stockholder proposal to establish one-year terms for direc-
tors; and
5. Transacting such other business as may properly come before the meeting.
Your attention is directed to the accompanying proxy statement for further
information with respect to the matters to be acted upon at the meeting.
Stockholders of record at the close of business on February 26, 1999 are en-
titled to notice of and to vote at the meeting. A list of such stockholders
will be open to the examination of any stockholder for any purpose germane to
the meeting for a period of ten days prior to the meeting at the Company's of-
fices, 200 Liberty Street, New York, New York.
Stockholders are requested to complete, date, sign and return the enclosed
proxy in the enclosed postage prepaid envelope. Until your proxy is voted you
may revoke it by delivery to the Company of a subsequently executed proxy or a
written notice of revocation. Your prompt response will be appreciated.
By order of the Board of Directors,
/s/ Peter G. Skinner
Peter G. Skinner
Secretary
March 22, 1999
<PAGE>
Dow Jones & Company, Inc.
200 Liberty Street, New York, New York 10281
Proxy Statement
1999 Annual Meeting of Stockholders to be held Wednesday, April 21, 1999
Solicitation and Revocation of Proxies
This proxy statement is furnished in connection with the solicitation on be-
half of the Board of Directors of Dow Jones & Company, Inc. of proxies for use
at the Annual Meeting of Stockholders to be held at 11:00 a.m. on Wednesday,
April 21, 1999 at Windows on the World--106th floor, One World Trade Center,
New York, New York for the purposes set forth in the accompanying Notice of
Annual Meeting of Stockholders. If the enclosed proxy is executed and re-
turned, all shares represented thereby will be voted. Each proxy will be voted
in accordance with the stockholder's instructions with respect to (i) the
election of directors, (ii) approving the appointment of
PricewaterhouseCoopers LLP as auditors for 1999, (iii) acting upon a stock-
holder proposal to establish cumulative voting in the election of directors
and (iv) acting upon a stockholder proposal to establish one-year terms for
directors. If no such instructions are specified, the proxies will be voted
FOR the election of each person nominated for election as a director, FOR ap-
proving the appointment of PricewaterhouseCoopers LLP and AGAINST each of the
two stockholder proposals. Until a proxy is voted it may be revoked by a
stockholder by delivery to the Secretary of the Company at the above address
of a subsequently executed proxy or a written notice of revocation. The cost
of preparing and mailing this proxy statement and proxies will be borne by the
Company. Proxies may be solicited by officers, directors and regular employees
of the Company by mail, telephone and personal solicitation, and no additional
compensation will be paid to such individuals. The Company may also reimburse
brokers and other persons holding stock in their names or in the names of
their nominees for their charges and expenses in forwarding proxies and proxy
material to the beneficial owners of such stock. In addition, the Company has
retained D.F. King & Co., Inc., 77 Water Street, New York, New York 10005 to
aid in the solicitation of proxies by mail, telephone, telecopy and personal
solicitation and will request brokerage houses and other nominees, fiduciaries
and custodians to forward soliciting materials to beneficial owners of the
Company's Common Stock and Class B Common Stock. For these services, the Com-
pany will pay D.F. King & Co., Inc. a fee of $10,000, plus expenses.
---------------------------------------------------
Common Stock Outstanding
At the close of business on February 26, 1999 there were outstanding and enti-
tled to vote 70,563,447 shares of Common Stock and 20,862,873 shares of Class
B Common Stock of the Company. Each share of Common Stock is entitled to one
vote. Each share of Class B Common Stock is entitled to ten votes. The Common
Stock, voting separately as a class, is entitled to elect two directors to be
elected at the meeting to serve a three-year term expiring in 2002. The Common
Stock and the Class B Common Stock vote together with respect to the election
of three directors to be elected at the meeting to serve a three-year term ex-
piring in 2002 and all other matters submitted to the stockholders.
<PAGE>
Security Ownership of Certain Beneficial Owners
The following table sets forth information, as of December 31, 1998, with re-
spect to the number of shares of Common Stock and Class B Common Stock owned
by the only persons who were known by the Company to own beneficially more
than 5% of the outstanding Common Stock or Class B Common Stock.
<TABLE>
<CAPTION>
Shares
Beneficially
Name and Address of Beneficial Owner Owned(a) Percent of Class
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
Christopher Bancroft Common 4,327,405(b) 6.1%
c/o Holme Roberts & Owen LLP Class B 3,820,360(b) 18.3%
1700 Lincoln Street
Denver, Colorado 80203
- ----------------------------------------------------------------------------
Capital Research & Management Co. Common 7,057,600(c) 10.0%
333 South Hope Street
Los Angeles, California 90071
- ----------------------------------------------------------------------------
Judson W. Detrick Common 3,129,572(d) 4.4%
Holme Roberts & Owen LLP Class B 2,266,261(d) 10.9%
1700 Lincoln Street
Denver, Colorado 80203
- ----------------------------------------------------------------------------
Michael B. Elefante Common 2,956,246(d) 4.2%
Hemenway & Barnes Class B 1,687,468(d) 8.1%
60 State Street
Boston, Massachusetts 02109
- ----------------------------------------------------------------------------
Timothy F. Fidgeon Common 1,627,745(d) 2.3%
Hemenway & Barnes Class B 2,160,563(d) 10.4%
60 State Street
Boston, Massachusetts 02109
- ----------------------------------------------------------------------------
Franklin Mutual Advisers, Inc. Common 3,678,100(e) 5.2%
51 John F. Kennedy Parkway
Short Hills, New Jersey 07078
- ----------------------------------------------------------------------------
Roy A. Hammer Common 11,044,159(d) 15.7%
Hemenway & Barnes Class B 8,454,482(d) 40.5%
60 State Street
Boston, Massachusetts 02109
- ----------------------------------------------------------------------------
Paul D. Holleman Common 3,130,172(d) 4.4%
Holme Roberts & Owen LLP Class B 2,266,211(d) 10.9%
1700 Lincoln Street
Denver, Colorado 80203
- ----------------------------------------------------------------------------
Jane C. MacElree Common 6,364,471(f) 9.0%
c/o Hemenway & Barnes Class B 3,889,496(f) 18.6%
60 State Street
Boston, Massachusetts 02109
- ----------------------------------------------------------------------------
Rod B. MacLeod Common 2,685,533(d) 3.8%
MacLeod & McGinness Class B 1,380,196(d) 6.6%
1800 Second Street, Suite 971
Sarasota, Florida 34236
- ----------------------------------------------------------------------------
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
Shares
Beneficially
Name and Address of Beneficial Owner Owned(a) Percent of Class
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
James H. Ottaway, Sr. Common 2,636,621(g) 3.7%
Ruth B. Ottaway Class B 1,679,014(g) 8.0%
James H. Ottaway, Jr.
David B. Ottaway
Ruth Ottaway Sherer
c/o Ottaway Newspapers, Inc.
Post Office Box 401
Campbell Hall, New York 10916
- ---------------------------------------------------------------------------
Lawrence T. Perera Common 4,060,550(d) 5.8%
Hemenway & Barnes Class B 3,477,000(d) 16.7%
60 State Street
Boston, Massachusetts 02109
- ---------------------------------------------------------------------------
Michael J. Puzo Common 906,474(d) 1.3%
Hemenway & Barnes Class B 1,899,488(d) 9.1%
60 State Street
Boston, Massachusetts 02109
- ---------------------------------------------------------------------------
Thomas A. Richardson Common 3,024,572(d) 4.3%
Holme Roberts & Owen LLP Class B 1,928,331(d) 9.2%
1700 Lincoln Street
Denver, Colorado 80203
- ---------------------------------------------------------------------------
George T. Shaw Common 892,328(d) 1.3%
Hemenway & Barnes Class B 1,084,398(d) 5.2%
60 State Street
Boston, Massachusetts 02109
- ---------------------------------------------------------------------------
State Street Bank & Trust Company Common 5,849,317(h) 8.3%
225 Franklin Street Class B 3,226,336(h) 15.5%
Boston, Massachusetts 02110
- ---------------------------------------------------------------------------
Elizabeth Steele Common 3,904,798(d) 5.5%
c/o Hemenway & Barnes Class B 2,144,949(d) 10.3%
60 State Street
Boston, Massachusetts 02109
- ---------------------------------------------------------------------------
Bayne Stevenson Common 3,302,549(d) 4.7%
c/o Hemenway & Barnes Class B 1,736,495(d) 8.3%
60 State Street
Boston, Massachusetts 02109
- ---------------------------------------------------------------------------
</TABLE>
(a) Except as otherwise indicated, the beneficial owner has sole voting and
investment power.
(b) Includes 4,060,000 shares of Common Stock and 3,477,000 shares of Class B
Common Stock held by Mr. Bancroft as trustee, as to which he shares voting and
investment power with other trustees, including Messrs. Hammer and Perera.
Also includes 267,405 shares of Common Stock and 343,360 shares of Class B
Common Stock held by Mr. Bancroft as trustee of a revocable trust, as to which
he shares voting and investment power with other trustees, including Messrs.
Holleman, Richardson and Detrick. Mr. Bancroft could acquire sole voting and
investment power over such shares if he were to revoke the trust.
(c) Capital Research & Management Co. held all of these shares as an invest-
ment adviser and had sole investment power over all of these shares and no
voting power over any of these shares.
(d) Includes shares held as trustee, as to which voting and investment power
is shared with other trustees (including other persons named above), by the
following persons, each of whom disclaims beneficial ownership of such shares;
Mr. Detrick--3,129,572 shares of common stock; and 2,266,211 shares of Class B
Common Stock; Mr. Elefante--2,956,246 shares of Common Stock and 1,687,468
shares of Class B Common Stock; Mr. Fidgeon--1,627,745
3
<PAGE>
shares of Common Stock and 2,160,563 shares of Class B Common Stock; Mr. Ham-
mer--11,044,009 shares of Common Stock and 8,454,482 shares of Class B Common
Stock; Mr. Holleman--3,129,572 shares of Common Stock and 2,266,211 shares of
Class B Common Stock; Mr. MacLeod--2,685,533 shares of Common Stock and
1,380,196 shares of Class B Common Stock; Mr. Perera--4,060,550 shares of Com-
mon Stock and 3,477,000 shares of Class B Common Stock; Mr. Puzo--906,474
shares of Common Stock and 1,899,488 shares of Class B Common Stock; Mr. Rich-
ardson--3,024,572 shares of Common Stock and 1,928,331 shares of Class B Com-
mon Stock; Mr. Shaw--892,328 shares of Common Stock and 1,084,398 shares of
Class B Common Stock; Ms. Steele--3,904,798 shares of Common Stock and
2,144,949 shares of Class B Common Stock; and Mr. Stevenson--3,283,118 shares
of Common Stock and 1,727,697 shares of Class B Common Stock. Also includes
150 shares of Common Stock held by a revocable trust for the benefit of Mr.
Hammer, as to which he could acquire sole voting and investment power if he
were to revoke the trust. Also includes 600 shares of Common Stock held by Mr.
Holleman as trustee, as to which Mr. Holleman has sole voting and investment
power.
(e) Franklin Mutual Advisers, Inc. held all of these shares as an investment
adviser and had sole voting and investment power over all of these shares.
(f) Includes 5,482,471 shares of Common Stock and 3,348,848 shares of Class B
Common Stock held by Mrs. MacElree as trustee, as to which she shares voting
and investment power with other trustees, including Mr. Elefante with respect
to 2,705,000 shares of Common Stock and 1,440,250 shares of Class B Common
Stock; Mr. Hammer with respect to 2,730,400 shares of Common Stock and
1,746,733 shares of Class B Common Stock; Mr. Puzo with respect to 46,900
shares of Common Stock and 161,800 shares of Class B Common Stock; and Mr.
Shaw with respect to 14,400 shares of Common Stock and 394,683 shares of Class
B Common Stock. Also includes 807,745 shares of Common Stock and 539,063
shares of Class B Common Stock held by Mrs. MacElree as trustee of a revocable
trust, as to which she shares voting and investment power with other trustees,
including Messrs. Fidgeon and Shaw. Mrs. MacElree could acquire sole voting
and investment power over such shares if she were to revoke the trust.
(g) All of these shares have been deposited in a voting trust by various Otta-
way family trusts, individual members of the Ottaway family and a private in-
vestment company owned by members of the Ottaway family. The voting trustees
under the voting trust are James H. Ottaway, Sr., his wife, Ruth B. Ottaway,
and their adult children, James H. Ottaway, Jr., David B. Ottaway and Ruth Ot-
taway Sherer. The voting trust will remain in effect until January 27, 2003,
but shares may be withdrawn from the voting trust prior thereto. As of January
21, 1999, each of James H. Ottaway, Sr., Ruth B. Ottaway and David B. Ottaway
beneficially owned 2,636,621 shares of Common Stock and 1,679,014 shares of
Class B Common Stock. As of January 21, 1999, Ruth Ottaway Sherer beneficially
owned 2,808,791 shares of Common Stock (4.0%) and 1,716,203 shares of Class B
Common Stock (8.2%). As of January 21, 1999, James H. Ottaway, Jr. benefi-
cially owned 2,715,279 shares of Common Stock (includes 73,582 shares subject
to options) and 1,679,014 shares of Class B Common Stock. Each of the forego-
ing persons is deemed the beneficial owner of the shares held in the voting
trust described above and, accordingly, each of the foregoing figures includes
such shares. In addition, various other shares are also included more than
once in the foregoing figures as a result of other shared ownership arrange-
ments. Each of James H. Ottaway, Sr., Ruth B. Ottaway, James H. Ottaway, Jr.,
David B. Ottaway and Ruth Ottaway Sherer shares voting power over 2,636,621
shares of Common Stock and 1,679,014 shares of Class B Common Stock and in-
vestment power over 35,000 shares of Common Stock and 1,540 shares of Class B
Common Stock. Ruth Ottaway Sherer has sole voting and investment power over
172,170 shares of Common Stock and 37,189 shares of Class B Common Stock.
(h) State Street Bank & Trust Company held all of these shares as trustee,
disclaimed beneficial ownership of them and shared voting and investment power
with persons named above as to 3,938,605 shares of Common Stock and 2,763,143
shares of Class B Common Stock.
4
<PAGE>
Security Ownership of Directors and Management
The following table sets forth information as of January 21, 1999, with re-
spect to the number of shares of Common Stock and Class B Common Stock owned
by each director and nominee
for director, the five most highly compensated executive officers, and all di-
rectors, nominees and executive officers as a group.
<TABLE>
<CAPTION>
Shares Beneficially Percent of Common Stock
Name Owned(1) Class(2) Equivalents(3)
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Rand V. Araskog Common 8,000 * 24,491
Class B 700 *
- -------------------------------------------------------------------------------
Jerome H. Bailey Common 20,000 * 1,272
Class B -- *
- -------------------------------------------------------------------------------
Christopher Bancroft (5) (6)
(7) Common 4,327,405 6.1% 909
Class B 3,820,360 18.3%
- -------------------------------------------------------------------------------
Kenneth L. Burenga (4) Common 143,010 * --
Class B 3,015 *
- -------------------------------------------------------------------------------
William C. Cox, Jr. (5) (6) (8) Common 192,071 * 1,748
Class B 639,061 3.1%
- -------------------------------------------------------------------------------
Harvey Golub Common 2,000 * 2,219
Class B -- *
- -------------------------------------------------------------------------------
Roy A. Hammer (6) (9) Common 11,044,159 15.7% 69
Class B 8,454,482 40.5%
- -------------------------------------------------------------------------------
Leslie Hill (5) (6) (10) Common 117,821 * 1,071
Class B 69,573 *
- -------------------------------------------------------------------------------
Irvine O. Hockaday, Jr. Common 3,000 * 5,180
Class B -- *
- -------------------------------------------------------------------------------
Vernon E. Jordan, Jr. Common 274 * 7,545
Class B 105 *
- -------------------------------------------------------------------------------
Peter R. Kann (4) Common 268,884 * 5,613
Class B 4,027 *
- -------------------------------------------------------------------------------
David K.P. Li Common 8,030 * 7,923
Class B -- *
- -------------------------------------------------------------------------------
Jane C. MacElree (5) (6) (11) Common 6,364,471 9.0% 730
Class B 3,889,496 18.6%
- -------------------------------------------------------------------------------
M. Peter McPherson Common -- * 853
Class B -- *
- -------------------------------------------------------------------------------
Frank N. Newman Common 500 * 730
Class B -- *
- -------------------------------------------------------------------------------
James H. Ottaway, Jr. (12) Common 2,715,279 3.8% --
Class B 1,679,014 8.0%
- -------------------------------------------------------------------------------
Peter G. Skinner (4) Common 80,857 * --
Class B -- *
- -------------------------------------------------------------------------------
William C. Steere, Jr. Common 1,000 * 2,285
Class B -- *
- -------------------------------------------------------------------------------
All directors and executive
officers Common 25,342,999 35.9% 65,700
as a group (21 persons) (13) Class B 18,559,833 89.0%
- -------------------------------------------------------------------------------
</TABLE>
5
<PAGE>
(1) Except as otherwise indicated, the beneficial owner has sole voting and
investment power. Includes shares of Common Stock subject to options exercis-
able within 60 days after January 21, 1999 held by: Mr. Burenga (117,282
shares), Mr. Cox (22,930 shares), Mr. Kann (182,016 shares), Mr. Ottaway
(73,582 shares) and Mr. Skinner (69,767 shares).
(2) For purposes of computing the percentages above, the number of shares of
Common Stock outstanding includes any shares which may be acquired by the
named person within 60 days after January 21, 1999. An asterisk under the col-
umn "Percent of Class" indicates that the named person beneficially owns less
than one percent of the shares of Common Stock or Class B Common Stock out-
standing.
(3) Under the directors' deferred stock equivalent compensation plan, each
non-employee director was credited with $20,000 worth of stock equivalents for
1998. Certain directors have elected to defer receipt of some or all of their
fees payable in cash and have invested such deferred amounts in stock equiva-
lents. Amounts previously accrued under the terminated retirement plan for
non-employee directors by directors who continued to serve on the Board after
the 1997 Annual Meeting were added to such directors' deferred compensation
accounts and certain directors have elected to invest such accrued amounts in
stock equivalents. (See page 11 for additional information regarding direc-
tors' stock equivalents.) Also, certain executive officers have elected to
have the amounts allocated to their accounts under the Supplementary Benefit
Plan (see footnote (3) of the Summary Compensation Table on page 12) deemed to
be invested in stock equivalents.
(4) Includes shares owned by, or jointly with, spouses, as follows: Mr. Bai-
ley--20,000 shares of Common Stock owned jointly with his spouse; Mr.
Burenga--7,522 shares of Common Stock and 1,292 shares of Class B Common Stock
owned by his spouse; Mr. Kann--8,910 shares of Common Stock and 124 shares of
Class B Common Stock owned by his spouse; Mr. Skinner--4,012 shares of Common
Stock owned jointly with his spouse. Includes, with respect to Mr. Kann,
39,469 shares of Common Stock, subject to options exercisable within 60 days
after January 21, 1999 held by his spouse. Mr. Burenga shares voting and in-
vestment power with his spouse as to those shares owned by her. Mr. Kann dis-
claims beneficial ownership of the shares owned by his spouse. Messrs. Skinner
and Bailey share voting and investment power with their spouses as to those
shares owned jointly.
(5) Mr. Cox is the brother of Mrs. MacElree. Mr. Cox and Mrs. MacElree are
first cousins of Mr. Bancroft. Ms. Hill is the daughter of Mrs. MacElree.
(6) As of January 1, 1999, Mr. Cox, Mr. Bancroft, Mrs. MacElree and Ms. Hill,
certain of their relatives, and certain trusts and charitable organizations
established by them, including trusts for which Mr. Hammer serves as trustee,
owned beneficially a total of 21,705,685 shares (31%) of the outstanding Com-
mon Stock and 16,788,565 shares (80%) of the outstanding Class B Common Stock.
Such shares account for approximately 68% of the votes represented by the out-
standing Common Stock and Class B Common Stock. Mr. Cox, Mr. Bancroft,
Mrs. MacElree and Ms. Hill, trusts as to which they or certain of their rela-
tives are trustees or have beneficial or reversionary interests, and the
trustees of such trusts (including Mr. Hammer), may be considered in control
of the Company and therefore its "parent."
(7) Includes 267,405 shares of Common Stock and 343,360 shares of Class B Com-
mon Stock held by Mr. Bancroft as trustee of a revocable trust, as to which he
shares voting and investment power with other trustees and as to which he
could acquire sole voting and investment power if he were to revoke the trust.
Also includes 4,060,000 shares of Common Stock and 3,477,000 shares of Class B
Common Stock held by Mr. Bancroft as trustee, as to which he shares voting and
investment power with other trustees.
(8) Includes 34,077 shares of Common Stock and 207,400 shares of Class B Com-
mon Stock held by a revocable trust for the benefit of Mr. Cox, as to which he
could acquire sole voting and investment power if he were to revoke the trust.
Also includes 135,064 shares of Common Stock and 431,621 shares of Class B
Common Stock, as to which Mr. Cox disclaims beneficial ownership, as follows:
80,314 shares of Common Stock and 379,791 shares of Class B Common Stock held
by Mr. Cox as trustee, as to which he shares voting and investment power;
41,500 shares of Common Stock and 27,130 shares of Class B Common Stock held
by
6
<PAGE>
trustees for Mr. Cox's spouse; and 13,250 shares of Common Stock and 24,700
shares of Class B Common Stock held by a foundation of which Mr. Cox is Presi-
dent.
(9) Includes 150 shares of Common Stock held by a revocable trust for the ben-
efit of Mr. Hammer, as to which he could acquire sole voting and investment
power if he were to revoke the trust. Also includes 11,044,009 shares of Com-
mon Stock and 8,454,482 shares of Class B Common Stock held by Mr. Hammer as
trustee, as to which he disclaims beneficial ownership and shares voting and
investment power with other trustees.
(10) Includes 6,299 shares of Common Stock and 2,038 shares of Class B Common
Stock owned by Ms. Hill's spouse and minor children.
(11) Includes 807,745 shares of Common Stock and 539,063 shares of Class B
Common Stock held by Mrs. MacElree as trustee of a revocable trust, as to
which she shares voting and investment power with other trustees and as to
which she could acquire sole voting and investment power if she were to revoke
the trust. Also includes 5,482,471 shares of Common Stock and 3,348,848 shares
of Class B Common Stock held by Mrs. MacElree as trustee, as to which she dis-
claims beneficial ownership and shares voting and investment power with other
trustees and 4,255 shares of Common Stock and 1,585 shares of Class B Common
Stock owned by her spouse.
(12) See footnote (g) on page 4 above for a description of Mr. Ottaway's own-
ership of Common Stock and Class B Common Stock.
(13) Includes 548,485 shares of Common Stock subject to options that may be
exercised by executive officers and directors within 60 days after January 21,
1999. Also includes shares owned by or jointly with their spouses and by their
children and relatives sharing their homes.
---------------------------------------------------
Annual Report
The Company has mailed to all stockholders its Annual Report for the year
ended December 31, 1998. The Annual Report includes an audited balance sheet
as of that date and audited statements of income, stockholders' equity and
cash flows for the year then ended.
---------------------------------------------------
Voting Procedures
If a quorum is present at the meeting (i) a plurality of the votes of the
shares of Common Stock present in person or represented by proxy and entitled
to vote is required in order to elect the nominees for election to the office
of director that the Common Stock, voting separately as a class, is entitled
to elect, (ii) a plurality of the votes of the shares of Common Stock and
Class B Common Stock present in person or represented by proxy and entitled to
vote is required in order to elect the nominees for election to the office of
director that the Common Stock and the Class B Common Stock elect together,
(iii) the affirmative vote of a plurality of the votes of the shares of Common
Stock and Class B Common Stock voting together that are present in person or
represented by proxy and entitled to vote is required in order to approve the
appointment of PricewaterhouseCoopers LLP as auditors, and (iv) the affirma-
tive vote of a plurality of the votes of the shares of Common Stock and Class
B Common Stock voting together that are present in person or represented by
proxy and entitled to vote is required in order for each of the two stock-
holder proposals to be approved. With regard to the election of directors,
votes may be cast in favor or withheld; votes that are withheld will have no
effect on the outcome of the vote. With regard to other proposals, votes may
be cast in favor or against, or a stockholder may abstain. Abstentions will be
counted as shares that are represented at the meeting and entitled to vote.
Under Delaware law, abstentions on PricewaterhouseCoopers LLP or the two
stockholder proposals will have the effect of a negative vote because
PricewaterhouseCoopers LLP and the stockholder proposals require the affirma-
tive vote of a plurality of the shares of Common Stock and Class B Common
Stock present in person or represented by proxy and entitled to
7
<PAGE>
vote. Shares represented by limited proxies that prohibit voting on a particu-
lar matter (so-called broker non-votes) will be disregarded and will have no
effect on the outcome of the vote on such matter, although the shares repre-
sented by such limited proxies will be counted for quorum purposes.
---------------------------------------------------
Election of Directors
One of the purposes of the meeting is the election of five directors to serve
for a three-year term expiring in 2002. The Board of Directors has nominated
the individuals listed below for election as directors. The holders of Common
Stock voting separately as a class are entitled to vote for the election of
Messrs. McPherson and Steere. The holders of Common Stock and Class B Common
Stock voting together are entitled to vote for the election of Messrs.
Bancroft and Kann and Ms. Hill. The proxies in the accompanying form will be
voted for the election of such individuals unless instructions are given to
withhold authority to vote for one or more of them. For each nominated indi-
vidual, the table below sets forth his or her age as of the date of the meet-
ing, membership on committees of the Board of Directors and certain other in-
formation. Each of the persons named below is currently a director. If for any
reason any one or more of the persons named below should become unavailable
for election, proxies will be voted for the election of such substitute nomi-
nees as the Board of Directors may propose.
---------------------------------------------------
8
<PAGE>
Nominees for Election at the Annual Meeting:
<TABLE>
<S> <C> <C> <C>
Class of 2002
<CAPTION>
Positions with the Company
and Business Experience Director
Name Age During the Past Five Years Since
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
Christopher Bancroft 47 Director of the Company 1996
Compensation Committee
- ----------------------------------------------------------------------------
Peter R. Kann(1) 56 Chairman and Chief 1987
Executive Committee Executive Officer of the
Company
- ----------------------------------------------------------------------------
Leslie Hill 45 Pilot for American 1997
Corporate Governance Committee Airlines
- ----------------------------------------------------------------------------
M. Peter McPherson 58 President, Michigan State 1998
Audit Committee University
- ----------------------------------------------------------------------------
William C. Steere, Jr. 62 Chairman and Chief 1997
Corporate Governance and Executive Executive Officer, Pfizer
Committees Inc. (pharmaceuticals)(2)
- ----------------------------------------------------------------------------
</TABLE>
Incumbent Directors (Class of 2000)
The table below sets forth similar information for each director whose term ex-
pires in 2000.
<TABLE>
<CAPTION>
Positions with the Company
and
Business Experience Director
Name Age During the Past Five Years Since
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Harvey Golub 60 Chairman and Chief 1997
Audit and Corporate Governance Executive Officer,
Committees American Express Company
(travel and financial
services company)(3)
- -------------------------------------------------------------------------------
Roy A. Hammer(4)(6) 64 Senior Partner, Hemenway & 1998
Barnes, attorneys
- -------------------------------------------------------------------------------
David K.P. Li 60 Chairman and Chief Execu- 1993
Audit and Corporate Governance tive Officer, The Bank of
Committees East Asia, Limited (bank-
ing) (5)
- -------------------------------------------------------------------------------
Jane C. MacElree 69 Director of the Company 1996
Compensation and Corporate Governance
Committees
- -------------------------------------------------------------------------------
Frank N. Newman 56 Chairman, President and 1997
Audit and Compensation Committees Chief Executive Officer,
Bankers Trust New York
Corporation and Bankers
Trust Company (banking).
Prior to September 1995,
Deputy Secretary of the
United States Treasury
- -------------------------------------------------------------------------------
James H. Ottaway, Jr. 61 Senior Vice President of 1987
the Company
- -------------------------------------------------------------------------------
</TABLE>
9
<PAGE>
Incumbent Directors (Class of 2001)
The table below sets forth similar information for each director whose term
expires in 2001.
<TABLE>
<CAPTION>
Positions with the Company and
Business Experience Director
Name Age During the Past Five Years Since
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Rand V. Araskog 67 Director of various 1981
Corporate Governance and Executive corporations.
Committees Prior to March 1998, Chairman
and Chief Executive Officer,
ITT
Corporation (hotel and gaming
company)(7)
- --------------------------------------------------------------------------------
William C. Cox, Jr. 68 Director of the Company and 1976
Corporate Governance and Executive prior to July 1997, Executive
Committees Director/Client Relations of
the Company
- --------------------------------------------------------------------------------
Irvine O. Hockaday, Jr. 62 President and Chief Executive 1990
Compensation and Executive Officer, Hallmark Cards, Inc.
Committees (greeting card
manufacturer)(8)
- --------------------------------------------------------------------------------
Vernon E. Jordan, Jr.(6) 63 Senior Partner, Akin, Gump,
Corporate Governance and Executive Strauss, Hauer & Feld,
Committees attorneys(9) 1982
- --------------------------------------------------------------------------------
</TABLE>
(1) Karen Elliott House, President/International Group of the Company and the
spouse of Mr. Kann, received a salary and bonus for 1998 of $352,784. An ag-
gregate of $58,688 was contributed to Ms. House's account under the Dow Jones
Profit Sharing Retirement Plan and the related Supplementary Benefit Plan in
respect of 1998. Ms. House received a payout for 1998 of 1,600 shares of Com-
mon Stock with a fair market value as of February 17, 1999 of $72,600 under
the Dow Jones 1992 Long Term Incentive Plan in respect of the four-year per-
formance period 1995-1998. Ms. House also received contingent stock rights and
stock options under the Dow Jones 1997 Long Term Incentive Plan. Ms. House's
compensation is set by the Compensation Committee of the Board of Directors.
(2) Mr. Steere is a director of Minerals Technologies Inc. and Texaco Inc.
(3) Mr. Golub is a director of Campbell Soup Company.
(4) Mr. Hammer was elected by the Board of Directors at its October 1998 meet-
ing as a member of the Board class of 2000.
(5) Mr. Li is a director of Campbell Soup Company, Hong Kong Telecommunica-
tions Limited, The Bank of East Asia, Limited, The Hong Kong & China Gas Com-
pany Limited, Sime Darby Hong Kong Limited and South China Morning Post (Hold-
ings) Limited.
(6) During 1998, Hemenway & Barnes, the law firm of which Mr. Hammer is a se-
nior partner, and Akin, Gump, Strauss, Hauer & Feld, the law firm of which Mr.
Jordan is a senior partner, rendered certain legal services to the Company.
The Company expects that these law firms will continue to render legal serv-
ices to the Company in 1999.
(7) Mr. Araskog is a director of Alcatel Alsthom CGE, SA, The Hartford Finan-
cial Services Group, Inc., ITT Industries, Inc., ITT Educational Services,
Inc., Rayonier Inc. and Shell Oil Company.
(8) Mr. Hockaday is a director of Ford Motor Company, Sprint Corporation and
UtiliCorp United, Inc.
(9) Mr. Jordan is a director of American Express Company, Bankers Trust Compa-
ny, Bankers Trust New York Corporation, Callaway Golf Company, Chancellor Me-
dia Corporation, J.C. Penney Company, Inc., Revlon, Inc., Ryder System, Inc.,
Sara Lee Corporation, Union Carbide Corporation and Xerox Corporation.
---------------------------------------------------
10
<PAGE>
During 1998 the Board of Directors met ten times, the Audit Committee met four
times, the Compensation Committee met five times and the Corporate Governance
Committee met three times. The Executive Committee did not meet during the
year. In 1998 the annual director's fee was $40,000, with a cash component of
$20,000 and $20,000 deemed to be invested in shares of Common Stock ("stock
equivalents"); the fee for each Board meeting attended was $1,200; the fee for
each committee meeting attended was $1,000; and the annual fee for each com-
mittee chairman was $3,000.
In 1999, the cash component of the annual director's fee and the fees for
attending Board and committee meetings will remain the same as in 1998; the
annual fee for each committee chairman will be increased to $5,000 and the de-
ferred stock equivalents component of the annual director's fee will be in-
creased to $25,000. Such stock equivalents are credited quarterly and the num-
ber thereof are determined at the market price of the Company's Common Stock
on the last business day of the quarter in question.
From time to time Board members are invited to attend meetings of Board com-
mittees of which they are not members; in such cases, such Board members re-
ceive a committee meeting fee. Employees of the Company or its subsidiaries
who are directors do not receive director's, committee or committee chairman's
fees.
Directors may elect to defer receipt, in whole or in part, of any of their
fees payable in cash. Deferred amounts will, at the electing director's op-
tion, either be credited to an interest bearing account or be deemed to be in-
vested in shares of Common Stock (i.e., stock equivalents) at the market price
on the last business day of the month in which the deferred amount in question
would have otherwise been received. Deferred cash amounts will be paid in
cash, in a lump sum or in the form of annuity, as the director may elect. De-
ferred stock equivalent amounts will be paid in cash (in a lump sum or in the
form of an annuity) or shares of Common Stock (in up to fifteen annual in-
stallments), or a combination of cash and Common Stock, as the director may
elect.
During 1998 all directors of the Company attended at least 75% of the aggre-
gate meetings of the Board and standing committees on which they served.
The Audit Committee makes recommendations to the Board regarding the engage-
ment of the Company's independent auditors and considers the range of audit
and non-audit fees. It also reviews the work of the Company's internal audi-
tors, meets with the independent auditors to review and approve the scope and
results of their professional services, and reviews the procedures for evalu-
ating the adequacy of the Company's internal controls.
The Compensation Committee reviews remuneration arrangements for the
Company's senior management (including employee benefit plans in which execu-
tive officers are eligible to participate), makes recommendations to the Board
and grants options and other benefits under some of such plans.
The Corporate Governance Committee (formerly the Nominating Committee) rec-
ommends to the Board of Directors the persons to be nominated by the Board for
election as directors of the Company. Stockholders desiring to recommend nomi-
nees should submit their recommen- dations in writing to Peter G. Skinner,
Secretary, Dow Jones & Company, Inc., 200 Liberty Street, New York, New York
10281. Recommendations should include pertinent information concerning the
proposed nominee's background and experience. The Corporate Governance Commit-
tee also considers and makes recommendations to the Board of Directors con-
cerning the size and composition of the Board and considers from time to time
the current Board committee structure and membership.
---------------------------------------------------
11
<PAGE>
Executive Compensation
The following tables and report provide information as to the cash and non-
cash compensation
paid to, earned by or granted to each of the five most highly compensated se-
nior policy making executives of the Company.
Summary Compensation Table
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
- --------------------------------------------------------------------------------------------------------
Awards Payouts
- --------------------------------------------------------------------------------------------------------
Restricted Long-term
Stock Incentive All Other
Award ($) Options (#) Payouts ($) Compen-
Name and Principal Position Year Salary ($) Bonus ($) (1) (2) (3) sation ($) (4)
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Peter R. Kann, Chairman 1998 $750,000 $402,885 39,400 $376,613 $150,002
of the Board, Chief
Executive 1997 $735,000 $190,000 31,800 $282,562 $180,017
Officer and Director 1996 $715,000 $380,000 40,000 $234,525 $210,850
- --------------------------------------------------------------------------------------------------------
Kenneth L. Burenga, 1998 $600,000 $271,110 -- $263,175 $148,920
President, Chief
Operating 1997 $590,000 $140,000 16,900 $190,088 $113,472
Officer and Director(5) 1996 $550,000 $270,000 22,500 $198,750 $156,999
- --------------------------------------------------------------------------------------------------------
Peter G. Skinner,
Executive 1998 $492,500 $212,796 15,300 $154,275 $ 97,602
Vice President,
General 1997 $435,000 $153,000 10,700 $148,988 $113,074
Counsel and Secretary 1996 $410,000 $165,000 14,200 $147,075 $109,023
- --------------------------------------------------------------------------------------------------------
James H. Ottaway, Jr., 1998 $406,000 $155,138 13,000 $140,663 $ 79,413
Senior Vice President 1997 $391,000 $178,000 10,300 $128,438 $109,300
and Director 1996 $376,000 $160,000 12,900 $135,150 $101,386
- --------------------------------------------------------------------------------------------------------
Jerome H. Bailey 1998 $320,455 $214,150 $249,400 40,600 -- $ 61,859
Executive Vice
President and
Chief Financial
Officer(6)
- --------------------------------------------------------------------------------------------------------
</TABLE>
(1) The dollar value of this stock award is based on the market price of the
Company's Common Stock at time of grant. At December 31, 1998 Mr. Bailey held
a total of 4,700 shares of restricted stock with a fair market value of
$226,188. One-third of the shares of restricted stock will vest on April 15,
1999, another one-third will vest on April 15, 2000, and the remainder will
vest on April 15, 2001. Regular quarterly dividends are paid on the restricted
stock.
(2) In addition to stock option grants, the indicated executives were granted
contingent stock rights under the Dow Jones 1997 Long Term Incentive Plan. The
contingent stock rights granted during the most recently completed fiscal year
are reported in the long-term incentive plan table on page 14.
(3) The payouts shown in the table for 1998 reflect the fair market value as
of February 17, 1999 of the Final Awards made to the indicated executives un-
der the Dow Jones 1992 Long Term Incentive Plan in respect of the four-year
performance period 1995-1998. The payouts shown in the table for 1997 reflect
the fair market value as of January 21, 1998 of the Final Awards made to the
indicated executives under the Dow Jones 1992 Long Term Incentive Plan in re-
spect of the four-year performance period 1994-1997. The payouts shown in the
table for 1996 reflect the fair market value as of January 15, 1997 of the Fi-
nal Awards made to the indicated executives under the Dow Jones 1992 Long Term
Incentive Plan in respect of the four-year performance period 1993-1996. The
1992 Long Term Incentive Plan was replaced in 1997 by the Dow Jones 1997 Long
Term Incentive Plan.
(4) The amounts referred to in the table above under "All Other Compensation"
consist of the aggregate amounts contributed to the accounts of the indicated
executives under the Dow Jones Profit Sharing Retirement Plan and the related
Supplementary Benefit Plan in respect of the years indicated. With respect to
amounts con-
12
<PAGE>
tributed in 1998, the Internal Revenue Code limits the allocation of the an-
nual Company contribution for the benefit of any individual account under a
qualified profit sharing plan to the amount which would be contributed to such
individual account based on maximum annual compensation of $160,000, but per-
mits under a supplemental plan an additional allocation by the Company to such
individual equal to the additional amount which would otherwise have been al-
located to him or her under the qualified plan had there been no limits. Exec-
utive officers may elect to have the amounts allocated to their accounts under
the Supplementary Benefit Plan deemed to be invested in shares of Common
Stock. With respect to 1998, such amounts were deemed to be invested at the
closing price of the Common Stock on the first business day of 1999. With re-
spect to 1998, the Company has allocated the following amounts to the accounts
of the indicated executives under the Profit Sharing Retirement Plan: Mr.
Kann--$29,126; Mr. Burenga--$29,126; Mr. Skinner--$29,126; Mr. Ottaway--
$29,126; Mr. Bailey--$0. The Company has also allocated the following amounts
to the accounts of the indicated executives under the Supplementary Benefit
Plan with respect to 1998: Mr. Kann--$120,876; Mr. Burenga--$119,794; Mr.
Skinner--$68,476; Mr. Ottaway--$50,287; Mr. Bailey--$61,859. With respect to
Mr. Bailey, the amount allocated to his account under the Supplementary Bene-
fit Plan also includes the amount that would have been contributed to his ac-
count under the Profit Sharing Retirement Plan if he had been eligible to par-
ticipate in the Profit Sharing Retirement Plan with respect to 1998.
(5) Effective December 31, 1998, Mr. Burenga retired as president and chief
operating officer, and as a member of the Company's Board of Directors.
(6) Mr. Bailey joined the Company on April 15, 1998.
Option Grants In 1998
<TABLE>
<CAPTION>
Individual Grants
-------------------------------------------
% of Total Potential Realizable Value
Number of Options Exercise at Assumed Annual Rates
Securities Granted to or of Stock Price
Underlying Employees Base Price Appreciation over Stock
Options in Fiscal ($/Share) Expiration Option Term(3)
Name Granted(1) Year (2) Date 5% 10%
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Peter R. Kann........... 39,400 3.1% $49.125 11/18/08 $ 1,217,066 $ 3,085,020
Kenneth L. Burenga...... -- -- -- -- -- --
Peter G. Skinner........ 15,300 1.2% $49.125 11/18/08 $ 472,617 $ 1,197,990
James H. Ottaway, Jr.... 13,000 1.0% $49.125 11/18/08 $ 401,570 $ 1,017,900
Jerome H. Bailey........ 15,300 1.2% $49.125 11/18/08 $ 472,617 $ 1,197,990
25,300 2.0% $53.0625 4/15/08 $ 844,261 $ 2,139,621
- ------------------------------------------------------------------------------------------------
</TABLE>
(1) One-third of the stock options will become exercisable on the first anni-
versary of the date of grant, another one-third will become exercisable on the
second anniversary of the date of grant, and the remainder will become exer-
cisable on the third anniversary of the date of grant.
(2) The exercise price of the stock options which were granted on November 18,
1998 is $49.125 per share, the fair market value of the Common Stock on the
date of grant. The exercise price of the options which were granted to Mr.
Bailey on April 15, 1998 is $53.0625 per share, the fair market value of the
Common Stock on the date of grant.
(3) These amounts represent gains based on assumed rates of appreciation over
the entire ten-year period. Actual gains, if any, on stock option exercises
are dependent on the future performance of the Company's Common Stock and the
continued employment of the optionee through the vesting period.
13
<PAGE>
Aggregated Option Exercises In 1998
And Year-End Option Values
<TABLE>
<CAPTION>
Total Number of Value of Unexercised In-the-
Unexercised Options at Money Options at
December 31, 1998 (#) December 31, 1998($)(1)
------------------------- -----------------------------
Shares
Acquired on Value
Name Exercise (#) Realized ($) Exercisable Unexercisable Exercisable Unexercisable
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Peter R. Kann........... 1,969 $37,534 182,016 60,600 $2,268,323 $ 0
Kenneth L. Burenga...... 2,969 $56,597 117,282 11,267 $1,461,024 $ 0
Peter G. Skinner........ 3,130 $72,267 69,767 22,433 $ 866,635 $ 0
James H. Ottaway, Jr.... -- -- 73,582 19,867 $ 953,834 $ 0
Jerome H. Bailey........ -- -- -- 40,600 $ -- $ 0
- --------------------------------------------------------------------------------------------------------------
</TABLE>
(1) This represents the difference between the closing price of the Company's
Common Stock on December 31, 1998 ($48.125) and the exercise price of the op-
tions.
Long-Term Incentive Plan--Awards In 1998
<TABLE>
<CAPTION>
Performance or Other
Period Until
Number of Shares, Units Maturation
Name or Other Rights(1) or Payout
- --------------------------------------------------------------------------------
<S> <C> <C>
Peter R. Kann...................... 14,000 1999--2002
Kenneth L. Burenga................. -- 1999--2002
Peter G. Skinner................... 5,500 1999--2002
James H. Ottaway, Jr............... 4,625 1999--2002
Jerome H. Bailey................... 5,500 1999--2002
4,075 1998--2001
- --------------------------------------------------------------------------------
</TABLE>
(1) The long-term incentive plan awards are contingent stock rights granted
under the Dow Jones 1997 Long Term Incentive Plan. Each contingent stock right
gives the holder the contingent right to receive up to the number of shares of
Common Stock specified in the right (the "Initial Award") following completion
of a 4-year performance period. The number of shares ultimately received (the
"Final Award") will depend on the extent to which the performance criteria are
achieved during the 4-year performance period, the participant's individual
performance and other factors. Participants may elect, subject to the approval
of the Compensation Committee, to receive all or a portion of their Final
Awards in cash, or Common Stock, or a combination of both. If a participant
elects to receive all or a portion of the Final Award in cash, the amount of
cash will equal the closing price of the Common Stock on the date of the Final
Award multiplied by the number of shares of Common Stock as to which the elec-
tion is being made.
During the performance period relating to each right, the Compensation Com-
mittee may adjust the performance criteria and otherwise modify the terms and
provisions of the right. Also during the performance period, the holder is en-
titled to receive as "dividend equivalents" an amount equal to the cash divi-
dends that the holder would have received if the holder had owned the number
of shares of Common Stock covered by the Initial Award during the entire per-
formance period.
At December 31, 1998, Mr. Kann held contingent stock rights covering a total
of 60,000 shares; Mr. Bailey-- 9,575 shares; Mr. Burenga--27,725 shares; Mr.
Skinner--24,325 shares; and Mr. Ottaway--20,475 shares. At December 31, 1998,
the fair market value of the Common Stock subject to such rights was as fol-
lows: Mr. Kann--$2,887,500; Mr. Bailey--$460,797; Mr. Burenga--$1,334,266; Mr.
Skinner--$1,170,641; and Mr. Ottaway--$985,359.
The Final Award ultimately received may be less than or equal to the numbers
set forth above. It is expected that fully satisfactory competitive perfor-
mance (as judged by the Compensation Committee in its discretion at the time
of the payouts) would be competitively rewarded if the Final Award approxi-
mated 80% of the amounts set forth above. Exceptional performance would sup-
port a Final Award in excess of 80% of the amounts set forth above but in no
event more than 100% of such amounts.
---------------------------------------------------
14
<PAGE>
Separation Plan for Senior Management
At its January 1999 meeting the Board of Directors unanimously approved the
Dow Jones Separation Plan for Senior Management. The Plan covers separations
from service by senior executives including the executive officers named on
page 12. In order to receive benefits under the Separation Plan, an eligible
executive's employment must have been terminated involuntarily, without
"cause", and he or she must enter into an agreement with the Company contain-
ing a covenant not to compete, confidentiality provisions and customary mutual
releases and waivers. The Board has also approved the Plan's related form of
Separation Agreement and Release.
The Plan provides for severance benefits equal to 18 or 24 months (depending
on salary level) of base salary and target bonus. The plan also provides for
the continuation of certain benefits during such 18 or 24 month period includ-
ing those received under: the profit sharing retirement plan and the related
supplementary benefit plan; the health and dental care plans; and the execu-
tive death and group life, disability and accident insurance plans. In addi-
tion, terminated executives will receive a pro-rated final award with respect
to each of his or her outstanding grants of contingent stock rights under the
Company's Long Term Incentive Plan. The Separation Plan and the form of Sepa-
ration Agreement and Release will be included as an Exhibit to the Company's
Annual Report on Form 10-K for the year ended December 31, 1998 which will be
filed with the Securities and Exchange Commission by March 31, 1999.
---------------------------------------------------
Kenneth L. Burenga Separation Agreement
Mr. Burenga retired from the Company, effective December 31, 1998. He has
agreed to refrain from engaging in any business activity that is competitive
with the business of the Company and its subsidiaries for a two year period
commencing on the date of his retirement. In addition, Mr. Burenga agreed to
abide by certain confidentiality provisions. In consideration for performance
of his non-competition and confidentiality obligations, the Company will pay
Mr. Burenga an aggregate of $1,800,000 in 24 equal monthly installments of
$75,000 commencing on January 1, 1999 and ending on December 31, 2000. During
such 24 month period Mr. Burenga will continue to participate in certain bene-
fit plans and programs including: the profit sharing retirement plan and the
related supplementary benefit plan, with the Company's contributions being
based on Mr. Burenga's 1998 salary and target bonus; the health and dental
care plans; and the executive death and group life, disability and accident
insurance plans. In addition, Mr. Burenga will receive a pro-rated final award
with respect to each of his outstanding grants of contingent stock rights un-
der the Company's Long Term Incentive Plan. Mr. Burenga's Separation Agreement
and Release of Claims is consistent with the Company's recently adopted Sepa-
ration Plan for Senior Management described above and will be included as an
Exhibit to the Company's Annual Report on Form 10-K for the year ended Decem-
ber 31, 1998 which will be filed with the Securities and Exchange Commission
by March 31, 1999.
---------------------------------------------------
Compensation Committee Report on Executive Compensation
The Compensation Committee and the Compensation Program
The Committee consists of four non-employee directors. It generally meets five
times a year. The Compensation Committee's objective is to establish and ad-
minister a "total compensation program" that fairly and competitively rewards
Dow Jones executives for current and long-term performance that enhances
stockholder value. The purpose of this report is to explain the Company's
15
<PAGE>
executive compensation program and the operation of the Compensation Commit-
tee.
Elements of Compensation Program Considered by the Committee
The Committee gives special attention to the total compensation of the chief
executive officer (Mr. Kann), and certain other members of senior management.
We consider four elements of compensation: (1) annual salary; (2) annual in-
centive award (or bonus); (3) long-term incentive compensation; and (4) re-
tirement and other compensation.
Establishing and Administering a Competitive Program
The Committee retains outside compensation consultants and reviews competitive
compensation and performance studies in developing and administering the total
compensation program. We give continuing attention to changes in compensation
practices, business trends and changes in applicable law and regulations in
order to establish and administer a sound compet- itive compensation program.
As was the case for 1997, the competitive universe that we primarily consider
includes the five largest newspaper publishers in the Dow Jones
Media/Publishing Index (the "Company's peer group") (see page 19), but we also
review data on general industry trends and, from time to time, certain other
public companies which compete with one or more of the Company's business seg-
ments.
We believe that it is difficult to forecast in detail all future develop-
ments that will be relevant to evaluating long-term executive performance. For
that reason our long-term compensation program has vested substantial discre-
tion in the Committee to decide on awards to be made after evaluating actual
Company and individual performance.
With regard to annual incentive awards, however, the Committee, in working
with management and its outside compensation consultants, has determined that
a substantial portion of executives' awards will be based on the achievement
of certain pre-determined financial objectives. For the named executive offi-
cers, a substantial portion of their annual incentive awards will be based on
the achievement of these pre-determined financial objectives and the balance
will be based on the achievement of strategic goals and individual perfor-
mance. The Committee has retained some measure of discretion under the annual
incentive award program because it believes that it is somewhat difficult to
forecast in detail all future developments that will be relevant to an evalua-
tion of short-term executive performance.
Federal tax legislation in effect since 1994 eliminates the deductibility of
compensation in excess of $1,000,000 paid to the chief executive officer and
certain other executives (i.e., those whose compensation must be detailed in
the proxy statement). The law exempts compensation paid under plans that re-
late compensation to performance. Although our plans are designed to relate
compensation to performance, certain elements of them do not meet the tax
law's requirements because they allow the Committee to exercise discretion in
setting compensation. It may be appropriate in the future to recommend changes
in the Company's compensation program to take account of the tax law. However,
the Committee is of the opinion that it is better to retain discretion than to
give it up in exchange for the tax deduction. For 1998 the deductibility of
certain compensation paid to Mr. Kann was affected by this limitation.
Committee Reporting
The Committee makes full reports to the Board of Directors, which approves the
structure and general administration of the compensation program. The Board
reviews the specific compensation awards for the chief executive officer and
each of the other four executives whose compensation is described in the proxy
statement.
In 1998 the chief executive officer's salary was $750,000, an increase of
$15,000 (or 2%) from his 1997 salary of $735,000. The 1998 salaries for all
the five officers listed in the table on page 12 were set after evaluating
their individual contribution and performance and the value of their jobs in
the marketplace based on a review of the competitive compensation guidelines
that were developed with advice from our outside compensation consultants.
16
<PAGE>
For 1998 Mr. Kann was granted a bonus of $402,885. That represented a 112%
increase from his 1997 bonus of $190,000. In determining the bonuses for Mr.
Kann and the other officers listed in the table, we compared the Company's re-
sults to the financial, strategic and individual performance measures estab-
lished in early 1998. The bonus awards for 1998 reflect the Company's perfor-
mance measured against the pre-determined financial criteria and the Commit-
tee's view that the executives performed reasonably well against the non-fi-
nancial measures established under the bonus program. The varying levels of
salary and bonus for each of the executives also reflect differences in their
relative responsibilities.
We awarded long-term compensation to the chief executive officer and other
members of senior management in February 1999 under the Company's 1992 Long
Term Incentive Plan. The Final Awards covered performance for the period 1995-
1998 and were made after reviewing the Company's financial performance (in-
cluding total stockholder return, return on equity, earnings growth, profit
margins, and other financial criteria, such as the Company's performance rela-
tive to other newspaper and information services companies). We also consid-
ered progress toward achieving other Company objectives (quality of Dow Jones'
publications and services, development of products and services for a global
marketplace, quality of customer service and level of customer satisfaction,
development of human resources, including the recruitment and advancement of
women and minorities, promotion of teamwork throughout the Company, and com-
mitment to innovative products and services). And, finally, we considered each
individual executive's responsibility and performance. Overall, the Committee
determined that performance for the 1995-1998 period was less than fully sat-
isfactory. In the case of the 1995-1998 performance period, it was expected
that fully satisfactory competitive performance would be competitively re-
warded if the Final Award approximated 80% of the number of shares in the Ini-
tial Award. Exceptional performance would support a Final Award in excess of
80% (up to 100%) of the Initial Award. The Committee concluded that the
Company's financial performance during the 1995-1998 period did not warrant
Final Awards near the target 80% level.
Final Awards were made in February 1999 to Mr. Kann and Messrs. Burenga,
Skinner and Ottaway in amounts approximating 40% to 44% of their 1995 Initial
Awards. Mr. Kann's Final Award was 8,300 shares of Common Stock, and consti-
tuted approximately 40% of his Initial Award. That represented an increase of
2,800 shares from the 1997 Final Award. The net number of shares of Common
Stock received in February 1999 by Mr. Kann, after tax withholding, amounted
to 5,228. Messrs. Burenga and Ottaway received their Final Awards in cash. Mr.
Skinner received his Final Award in the form of Common Stock. The fair market
value of Mr. Kann's 1995-1998 Final Award was $376,613, which is approximately
33% higher in value than the 1997 award of $282,562.
In late 1998 we granted members of senior management contingent stock rights
and stock options under the 1997 Long Term Incentive Plan for the 1999-2002
performance period. These grants were estimated by our outside compensation
consultants to be at the median of general industry practice. The grants tie a
significant portion of each senior executive's potential compensation to the
Company's long-term objectives and to the market value of the Company's stock.
The Committee will determine the actual number of shares of stock payable to
an executive under the contingent stock rights at the end of the performance
period.
The Committee believes that the number of contingent stock rights and stock
options granted to individual executives should be set annually by the Commit-
tee after consultation with its consultants concerning competitive compensa-
tion levels. Accordingly, the Committee does not base the amount of stock op-
tion or contingent stock rights to be granted in any given year on the amounts
previously granted.
The Committee reaffirms its view that salaries and bonus and other incentive
compensation opportunities for the senior executives of the Company generally
should not deviate substantially from the median of the competitive guidelines
developed with the advice of our consul- tants and that, particularly with re-
spect to long-
17
<PAGE>
term incentive compensation, it is important that the Committee continue to re-
tain a degree of discretion as to the actual amounts paid. The Committee be-
lieves that the compensation
levels for the chief executive officer and other senior executives reflect
these criteria and are appropriate given performance during the periods cov-
ered.
Irvine O. Hockaday, Jr., Chairman
Christopher Bancroft
Jane C. MacElree
Frank N. Newman
---------------------------------------------------
18
<PAGE>
Comparison of Stockholder Return
The following line graph compares the performance of the Company's Common Stock
during the five-year period ended December 31, 1998 with the Standard & Poor's
500 Stock Index ("S&P 500") and the Dow Jones Media/Publishing Index.
The S&P 500 includes 500 U.S. companies in the industrial, transportation,
utilities and financial sectors and is weighted by market capitalization. The
Dow Jones Media/Publishing Index, which is also weighted by market
capitalization, includes, in addition to the Company, the following eleven
publishing companies: A.H. Belo Corporation, American Greetings Corporation,
The E.W. Scripps Company, Gannett Co., Inc., Knight-Ridder, Inc., The McGraw-
Hill Companies, Inc., The Reader's Digest Association, Inc., The New York Times
Company, The Times Mirror Company, Tribune Company, and The Washington Post
Company.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
Dow Jones & Co. vs. S&P 500 vs. Dow Jones Media/Publishing Index
Dow Jones Media/
Dow Jones & Co. S&P 500 Publishing Index
--------------- ------- ----------------
12/31/93 100 100 100
12/31/94 89 101 96
12/31/95 117 139 124
12/31/96 102 171 128
12/31/97 166 229 201
12/31/98 152 294 269
For purposes of the graph, it was assumed that $100 was invested in the
Company's Common Stock, the S&P 500 and the Dow Jones Media/Publishing Index at
closing prices on December 31, 1993. Dividends are assumed to be reinvested on
the ex-dividend date.
-------------------------------------------------
19
<PAGE>
Approval of Appointment of Independent Certified Public Accountants
At its February meeting the Board of Directors unanimously recommended that
the stockholders vote to approve the appointment of PricewaterhouseCoopers
LLP, independent certified public accountants, as auditors of the Company for
1999. PricewaterhouseCoopers LLP's predecessor, Coopers & Lybrand L.L.P., have
been the auditors for many years. Stockholder approval of the appointment of
such firm as auditors will be requested at the 1999 Annual Meeting. Represent-
atives of PricewaterhouseCoopers LLP will be present at the meeting, will have
the opportunity to make a statement if they so desire, and will be available
to respond to appropriate questions.
---------------------------------------------------
Stockholder Proposal 1
Mrs. Evelyn Y. Davis, Watergate Office Building, 2600 Virginia Avenue, N.W.,
Suite 215, Washington, D.C. 20037, who holds of record 90 shares of Common
Stock and 30 shares of Class B Common Stock, has informed the Company that she
intends to present to the meeting the following resolution:
RESOLVED: "That the stockholders of Dow Jones, assembled in Annual Meeting
in person and by proxy, hereby request the Board of Directors to take the nec-
essary steps to provide for cumulative voting in the election of directors,
which means each stockholder shall be entitled to as many votes as shall equal
the number of shares he or she owns multiplied by the number of directors to
be elected, and he or she may cast all of such votes for a single candidate,
or any two or more of them as he or she may see fit."
Mrs. Davis has submitted the following statement in support of her proposal:
"Many states have mandatory cumulative voting, so do National Banks.
In addition, many corporations have adopted cumulative voting.
Last year the owners of 24,806,066 shares, representing 9.5% of shares vot-
ing, voted FOR this proposal.
If you AGREE, please mark your proxy FOR this resolution."
Board of Directors' Position
The Board opposes Mrs. Davis' proposal because it believes that the existing
class voting structure provides greater Board representation for holders of
Common Stock than if all directors were elected as a single class with cumula-
tive voting. This is because the holders of Common Stock currently account for
approximately a quarter of the total votes outstanding but are entitled to
elect at least one-third of the directors to be elected at every annual meet-
ing.
The Company's certificate of incorporation and bylaws provide that at every
meeting of stockholders called for the election of directors, holders of Com-
mon Stock, voting separately as a class, are entitled to elect at least one-
third of the number of directors to be elected. Thus for example, as a result
of these provisions, holders of Common Stock will be entitled to elect two of
the five Board members to be elected at this year's annual meeting.
Adopting cumulative voting in place of the existing class voting structure
would, in fact, cause holders of Common Stock to be entitled to elect fewer
Board members. Based on the number of shares currently outstanding, if holders
of Common Stock and Class B Common Stock voted together for five directors us-
ing cumulative voting, holders of Common Stock would be ensured only one seat
on the Board of Directors, instead of the two seats that they are entitled to
under the existing class voting structure.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST ADOPTION OF THIS PROPOSED
RESOLUTION.
---------------------------------------------------
20
<PAGE>
Stockholder Proposal 2
The Independent Association of Publishers' Employees ("IAPE"), which holds of
record 55 shares of Common Stock and 10 shares of Class B Common Stock, has
informed the Company that it intends to present to the meeting the following
resolution:
RESOLVED, that shareholders request the Board of Directors to take steps
that may be necessary in accordance with state law, and without affecting the
unexpired terms of previously elected directors, to declassify the Board of
Directors so that all directors may be elected annually.
IAPE has submitted the following statement in support of its proposal:
The election of directors is the primary means by which stockholders may in-
fluence corporate policy and hold management accountable for the implementa-
tion of those policies. However, this avenue of influence is limited at Dow
Jones & Co. where the Board is divided into three classes of directors, with
staggered three-year terms.
This means directors face election only once every three years. As a result,
stockholders are deprived of the opportunity to hold two-thirds of the direc-
tors accountable for their conduct during the past year.
In 1997, the Board recognized the vital role that it performs when it
adopted the Dow Jones & Co. Principles of Corporate Governance. These princi-
ples declare that "the Board plays the central role in the company's gover-
nance; it is the company's decision making authority on all matters except
those reserved to the shareholders."
Despite some changes initiated by the Board since we submitted this proposal
last year, our Union believes that there continue to be pressing reasons for
adoption of the proposal. The $802 million loss posted for 1997 represented a
setback for Dow Jones; the damage has already led to significant changes in
order to address the long-term challenges facing the company. For example, the
President has resigned, and a new group of executives has been handed operat-
ing authority. In addition, the Company has embarked on a three-year strategic
business plan.
The Company is now at a critical juncture. The newly installed management
faces great challenges. And with so much at stake, it is more important than
ever that we have a Board that will be fully accountable for its oversight
functions.
Annual elections of directors would help to make the Board more accountable
to the stockholders and assure that the directors are zealous in monitoring
the performance of management. And that could be a significant step toward im-
proving corporate performance.
Board of Directors' Position
Consistent with the Board's response to this proposal in the Proxy Statement
for the 1998 Annual Meeting, the Board's Corporate Governance Committee re-
viewed the Company's classified Board structure in 1998 and concluded that no
change appeared necessary or advisable at this time. Having a classified Board
would make it more time consuming for a substantial stockholder to gain con-
trol of the Board and therefore would prevent a sudden change of control of
the Company. This assures that the Board would have time to review any pro-
posed business transaction and consider all relevant factors, in an open and
orderly process, and that the Board would have maximum negotiating leverage
and flexibility to make decisions that are in the best interests of the Com-
pany and its stockholders.
The Company's stockholders adopted the classified board structure in 1986 by
approving an amendment to the Company's Certificate of Incorporation which
provides that the Board of Directors be divided into three classes of direc-
tors as nearly equal in number as possible, with each class serving a three-
year term. That amendment also provides that an affirmative vote of more than
80% of the votes represented by the outstanding Common Stock and Class B Com-
mon Stock, voting together, would be required to return to the annual election
of directors.
21
<PAGE>
Substantially similar stockholder proposals seeking to declassify the Board
have been presented at the 1987, 1988, 1993, 1994, 1995 and 1998 Annual Meet-
ings and have been defeated by the vote of the Company's stockholders in each
instance.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST ADOPTION OF THIS PRO-POSED
RESOLUTION.
-------------------------------------------------
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, and persons who own more than ten percent of
the outstanding Common Stock or Class B Common Stock, to file reports of own-
ership and changes in ownership with the Securities and Exchange Commission
and the New York Stock Exchange. Such persons are also required by SEC regula-
tion to furnish the Company with copies of all Section 16(a) reports they
file.
In 1991 the SEC completed an extensive revision of its rules in this area.
In addition to increasing the number and kind of reports to be filed, the SEC
has obliged companies to report in their proxy statements failures to file re-
ports on a timely basis.
Based solely on its review of the copies of such forms received by the Com-
pany, or written representations from certain reporting persons that no Form 5
annual reports were required for those persons, the Company believes that dur-
ing 1998, all filing requirements under Section 16(a) of the Exchange Act ap-
plicable to its executive officers, directors, and greater than ten-percent
beneficial owners were complied with.
-------------------------------------------------
Corporate Governance
In 1997 the Board of Directors adopted the "Dow Jones & Company Principles of
Corporate Governance." The Principles are listed below. These Principles are
being published in this proxy statement to inform stockholders of the Board's
current thinking with respect to selected corporate governance issues consid-
ered to be of significance to stockholders. The Board will continue to assess
the appropriateness and efficacy of the Principles and it is likely that
changes to the Principles will be considered from time to time.
Dow Jones & Company Principles of Corporate Governance
1. The principal duty of the Board of Directors and management of Dow Jones &
Company is to assure that the company is well-managed in the interests of
its shareholders. Dow Jones seeks to protect and preserve the independence
and integrity of its products and services, including The Wall Street Jour-
nal, on which the company's long-term prosperity depends.
2. Dow Jones is owned by its shareholders; the shareholders, in turn, elect
the com-pany's Board of Directors. The Board plays the central role in the
company's governance; it is the company's decision-making authority on all
matters except those reserved to the shareholders. The Board, in turn, se-
lects the company's chief executive officer and approves the appointment of
other members of senior management; senior management is charged with the
conduct of the company's business.
22
<PAGE>
3. The primary functions of the Board are:
. review and, where appropriate, approval of the financial objectives, ma-
jor strategies and plans, and major corporate actions of Dow Jones;
. selection and evaluation of Dow Jones' chairman and chief executive of-
ficer;
. determining senior management compensation;
. periodic review of management succession plans;
. selection and recommendation to shareholders for election of appropriate
candidates for service on the Board;
. review of the adequacy of the company's systems for compliance with all
applicable laws and regulations, for safeguarding the company's assets
and for managing the major risks it faces; and
. provision of advice and counsel to senior management.
4. It is the policy of Dow Jones that the Board should consist of a majority
of "outside" directors. Consistent with this policy, and the underlying
philosophy of promoting vigorous representation for shareholders, Dow Jones
does not consider that anyone should be deemed an "inside" director by vir-
tue of the size of his or her shareholdings, no matter how great. On the
other hand, the company does consider any present or former member of se-
nior management to be an "inside" director, no matter the extent of his or
her shareholdings.
5. The number of directors shall not exceed a number that can function effi-
ciently as a body. The Corporate Governance Committee (formerly the Nomi-
nating Committee), in consultation with the chairman and CEO, considers and
makes recommendations concerning the appropriate size and membership needs
of the Board. The size of the Board will be not less than 10 nor more than
20 members; normally the number of directors will be approximately 15. The
Corporate Governance Committee also considers candidates to fill new Board
positions created by expansion and vacancies that occur by resignation, re-
tirement or for any other reason.
6. Prospective members of the Board are selected for their character and wis-
dom, judgment and integrity, business experience and acumen. The Corporate
Governance Committee also seeks to have a variety of occupational and a di-
versity of personal backgrounds represented on the Board. Directors are re-
quired to retire from the Board at the annual meeting of shareholders fol-
lowing their 70th birthday. Upon the adoption of these principles, no di-
rector who is an employee of the company shall be eligible for re-election
as a director after the termination of his or her employment.
7. Upon election, directors receive a package of orientation materials and an
extensive review of the company and its businesses from senior managers. In
addition, Board members are encouraged to visit company facilities through-
out their tenure on the Board.
8. All directors are expected to own stock in Dow Jones. The Compensation Com-
mittee annually reviews the compensation of directors. The company believes
that a substantial part of directors' compensation should be stock-based.
9. Because of the nature of the company's publishing business, no "inside" di-
rectors are permitted to serve as directors of other public companies, ex-
cept as representatives of Dow Jones in cases in which the company owns
shares in another company.
10. It is the general policy of the company that all major decisions be con-
sidered by the Board as a whole. This allows the company to gain the ad-
vantage of the collective wisdom of the Board. As a consequence, the com-
mittee structure of the Board is limited to those committees considered to
be basic to or required for the operation of Dow Jones as a publicly-owned
company. Currently these committees are the Executive Committee, the Audit
Committee, the Compensation Committee and the Corporate
23
<PAGE>
Governance Committee. The members and chairs of these committees are recom-
mended to the Board by the Corporate Governance Committee in consultation
with the chairman and CEO. The responsibilities of each of the committees
are determined by the Board from time to time.
11. Membership on the Audit, Compensation and Corporate Governance committees
is limited to outside directors. The chairman and CEO and other senior man-
agers attending meetings of these committees do so by invitation. The
chairs of these committees act as the chair at executive sessions or meet-
ings of outside directors at which the principal items to be considered are
within the scope of one of these committees' authority. This provides for
board leadership without the need to designate a lead director.
12. The frequency, length and agenda of meetings of each of the committees are
determined by the chair of the committee. Whenever possible, materials re-
lated to agenda items are provided to committee members sufficiently in ad-
vance of committee meetings to allow the directors to prepare for discus-
sion. Sufficient time to consider the agenda items is provided.
13. The Compensation Committee ensures that a proper system of current and
long-term compensation is in place to provide performance-oriented incen-
tives to management; reviews remuneration arrangements for senior manage-
ment; reviews and approves the structure of employee benefit plans; makes
recommendations to the Board; and grants options or other benefits under
certain employee benefit plans. The committee also is responsible for set-
ting annual and long-term performance goals (based on criteria established
in advance) for the chairman and CEO, and for evaluating performance
against these goals. The committee makes full reports to the entire Board,
which approves the structure and general administration of the compensation
program for the chairman and CEO and other senior managers.
14. The Audit Committee recommends to the shareholders the appointment of in-
dependent auditors; makes recommendations to the Board regarding their en-
gagement; and considers the range of audit and nonaudit fees. The committee
also reviews the work of the company's internal auditors, meets with the
independent auditors to review and approve the scope and results of their
professional services, and reviews the procedures for evaluating the ade-
quacy of the company's internal controls. The Audit Committee provides a
direct channel of communication to the Board for the independent auditors,
internal auditors, the chief financial officer and the general counsel.
15. It is the policy of Dow Jones that the positions of Chairman of the Board
and Chief Executive Officer be held by the same person, except in unusual
circumstances. This combination has served the company well over a great
many years.
16. The chairman and CEO is responsible for establishing effective communica-
tions with the company's stakeholder groups, i.e. shareholders, customers,
employees and others. It is the policy of Dow Jones that management speaks
for the company.
17. The chairman and CEO sets the agenda for meetings of the Board with the
understanding that certain items pertinent to the advisory and monitoring
functions of the Board be brought to it periodically by the chairman and
CEO for review or decision. For example, the annual corporate budget is re-
viewed by the Board, and capital expenditures above a certain threshold
amount (currently $15 million) are approved by the Board. Agenda items that
fall within the scope of responsibilities of a Board committee are reviewed
with the chair of that committee, who presents these matters to the Board.
Any Board member may request that an item be included on the agenda.
18. Whenever possible, materials related to agenda items are provided to Board
members sufficiently in advance of Board meetings to allow the directors to
prepare for discussion. Sufficient time to consider the agenda items is
provided.
24
<PAGE>
19. Generally, presentations of matters to be considered by the Board are made
by the manager responsible for that area of the company's operations. In
addition, Board members have free access to all other members of management
and employees of the company.
20. Executive sessions or meetings of outside directors without management
present are held at least once per year to review:
. the report of the independent auditors;
. the criteria upon which the performance of the chairman and CEO and
other senior managers is based;
. the performance of the chairman and CEO against such criteria;
. the compensation of the chairman and CEO and other senior managers; and
. the performance of the Board.
Additional executive sessions or meetings of outside directors may be held
from time to time as required, or as requested by directors.
21. These principles are reviewed by the Board from time to time.
---------------------------------------------------
Submission of Stockholder Proposals
Under Rule 14a-8(e) of the Securities Exchange Act of 1934, a stockholder pro-
posal intended for inclusion in next year's proxy statement must be received
by the Company at its principal executive offices not later than November 23,
1999.
With respect to proposals submitted under SEC Rule 14a-4(c)(1), any stock-
holder proposal for next year's Annual Meeting submitted after February 7,
2000 will not be considered filed on a timely basis with the Company. With re-
spect to proposals that are not timely filed, the Company retains discretion
to vote proxies it receives as the Board of Directors sees fit. With respect
to proposals that are timely filed, the Company retains discretion to vote
proxies it receives as the Board of Directors sees fit, provided 1) the Com-
pany includes in its proxy statement advice on the nature of the proposal and
how it intends to exercise its voting discretion and 2) the proponent does not
issue a proxy statement.
Other Matters
The Company knows of no other matter to be brought before the 1999 Annual
Meeting. If any other matter requiring a vote of the stockholders should come
before the meeting, it is the inten- tion of the persons named in the proxy to
vote the same with respect to any such matter in accordance with their best
judgment.
Stockholders who do not expect to attend the 1999 Annual Meeting in person
are requested to complete, date, sign and return the enclosed proxy promptly
in the enclosed postage prepaid envelope.
A copy of the Company's Annual Report on Form 10-K which will be filed with
the Securities and Exchange Commission by March 31, 1999 is available to in-
terested stockholders upon written request to Ms. Valerie Gerard, Director of
Investor Relations, Dow Jones & Company, Inc., 200 Liberty Street, New York,
New York 10281.
By order of the Board of Directors,
Peter G. Skinner
Secretary
New York, New York
March 22, 1999
25
<PAGE>
DOW JONES & COMPANY, INC.
Proxy Solicited on behalf of the Board of Directors for
Annual Meeting of Stockholders--April 21, 1999
The undersigned stockholder of Dow Jones & Company, Inc. hereby appoints
WILLIAM C. COX, Jr., PETER R. KANN and PETER G. SKINNER and each of them jointly
and severally, proxies, with full power of substitution, to vote all shares of
Common Stock and Class B Common Stock of the Company which the undersigned is
entitled to vote at the 1999 Annual Meeting of Stockholders to be held on
Wednesday, April 21, 1999, at 11:00 a.m. and at any adjournment thereof, upon
such business as may properly come before the meeting, including the following
proposals, which are described in the Proxy Statement dated March 22, 1999, a
copy of which has been received by the undersigned:
Election of Directors.
Nominees:
For Election by the Holders of Common Stock Voting Separately as a Class:
M. Peter McPherson and William C. Steere, Jr.
For Election by the Holders of Common Stock and Class B Common Stock Voting
Together:
Christopher Bancroft, Peter R. Kann and Leslie Hill.
PLEASE SIGN AND DATE ON REVERSE SIDE.
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
This proxy when properly executed will be voted in the manner directed herein by Please mark
the undersigned stockholder. If no direction is made, this proxy will be voted your votes as [X]
or Proposals 1(a), 1(b) and 2, and AGAINST Proposals 3 and 4. indicated in
this example
</TABLE>
- --------------------------------------------------------------------------------
The Board of Directors recommends a vote FOR Proposals 1(a), 1(b) and 2, and
AGAINST Proposals 3 and 4.
- --------------------------------------------------------------------------------
FOR WITHHELD
1(a). Election of Directors by Common Stock. [ ] [ ]
(see reverse)
For, except vote withheld from the following nominee(s):
____________________________________________________
<TABLE>
<CAPTION>
<S> <C> <C>
FOR WITHHELD
1(b). Election of Directors by Common Stock and Class B Common Stock. [_] [_]
and Class B Common Stock. (see reverse)
</TABLE>
For, except vote withheld from the following nominees(s):
____________________________________________________
FOR AGAINST ABSTAIN
2. Approval of Auditors [ ] [ ] [ ]
for 1999.
3. Stockholder Proposal [ ] [ ] [ ]
to establish cumulative
voting in the election
of directors.
4. Stockholder Proposal [ ] [ ] [ ]
to establish one-year
terms for directors
Signature(s)__________________________________________ Date:______________,1999
NOTE: Please sign exactly as name appears hereon. When signing as attorney,
executor, administrator or trustee or for a corporation, please give your full
title. For joint accounts, each owner must sign.
FOLD AND DETACH HERE
