2018 Guide to Effective Proxies

6 TH EDITION | GUIDE TO EFFECTIVE PROXIES 374 Named Executive Officer Compensation 61 What We Pay and Why: Elements of Executive Compensation Elements What We Did Objectives Where Described in More Detail FIXED Base Salary » Fixed amount of compensation for service during the year » Reward scope of responsibility, experience and individual performance Page 62 AT-RISK Annual Incentive Compensation » At-risk compensation, dependent on goal achievement » Formula-driven annual incentive linked to corporate financial, business unit financial and strategic objectives and other organizational priorities » Promote strong business results by rewarding value drivers, without creating an incentive to take excessive risk » Serve as key compensation vehicle for rewarding results and differentiating individual performance each year Page 63 Long-Term Incentive Compensation » Award values are granted based on market competitive norms and individual performance » 100% of PSUs are paid in shares of common stock upon vesting based on three-year relative TSR ranking compared to peers and to the broad market, over each cycle » Motivate and reward executives for outperforming peers over several years » Ensure that executives have a significant stake in the long-term financial success of the company, aligned with the stockholder experience » Promote longer-term retention Page 68 BENEFITS Retirement, Health and Welfare » 401(k) plan with company match » Competitive welfare benefits » Frozen pension plan and frozen supplemental executive retirement plan » Provide market-competitive benefits to attract and retain top talent » Frozen plans reflect legacy arrangements Page 72 SEVERANCE Severance Arrangements — Termination Due to Change in Control ("Double Trigger") » Severance and related benefits paid upon termination without cause or resignation for good reason following a change in control » Accelerated equity vesting upon termination post-change in control » Retention of executives through a change in control » Preserve executive objectivity when considering transactions in the best interest of stockholders » Assist in attracting top talent » Equity provisions keep executives whole in situations where shares may no longer exist or awards cannot otherwise be replaced Page 72 Severance Arrangements — Other » Specified amounts under employment arrangements with some executive officers » Discretionary guidelines, for involuntary terminations without cause » Provide transition assistance if employment ends involuntarily » Promote smooth succession planning upon retirement » Assist in attracting top talent » Allow the company to obtain release of employment-related claims Page 72 OTHER COMPENSATION Limited Perquisites » Limited additional benefits provided to certain executives » Provide nominal additional assistance that allows executives to focus on their duties Page 73 NASDAQ, INC.