Proposal 5: Stockholder Proposal – Shareholder Right to Act by Written Consent
Mr. Kenneth Steiner, 14 Stoner Ave., 2M, Great Neck, NY 11021, owner of no less than 500 shares of Nasdaq common stock, has informed Nasdaq that he plans to introduce the following proposal at the Annual Meeting. We are not responsible for the accuracy or content of the proposal and supporting statement, which are presented below as received from the proponent. To make sure readers can easily distinguish between material provided by the proponent and material provided by the company, we have put lines around material provided by the proponent.
STOCKHOLDER PROPOSAL AND SUPPORTING STATEMENT
Proposal 5 – Shareholder Right to Act by Written Consent
Shareholders request that our board of directors undertake such steps as may be necessary to permit written consent by shareholders entitled to cast the minimum number of votes that would be necessary to authorize the action at a meeting at which all shareholders entitled to vote thereon were present and voting. This written consent is to be consistent with applicable law and consistent with giving shareholders the fullest power to act by written consent consistent with applicable law. This includes shareholder ability to initiate any topic for written consent consistent with applicable law.
This proposal topic also won majority shareholder support at 13 major companies in a single year. This included 67%-support at both Allstate and Sprint. Hundreds of major companies enable shareholder action by written consent.
This proposal topic also won impressive 45%-support at the Nasdaq 2016 annual meeting. Plus this 45%-vote would have been still higher (possibly 51%) if small shareholders had the same access to corporate governance information as large shareholders.
This proposal is more important at Nasdaq because NDAQ shareholders do not have the full right to call a special meeting that is available under state law. Written consent would give shareholders greater standing to have input in improving the makeup of our Board of Directors after the 2018 annual meeting. For instance our Chairman and Lead Director were inside-related directors and thus not independent. Independence is a highly valuable attribute in a Chairman and a Lead Director.
Please vote to improve management accountability to shareholders:
Shareholder Right to Act by Written Consent – Proposal 5
The Board of Directors unanimously recommends a vote AGAINST Proposal 5.
BOARD OF DIRECTORS’ STATEMENT IN OPPOSITION
The Board believes that stockholder action by written consent, where there is no open meeting, advance notice, discussion or debate, can result in secretive and unsound decision making by permitting a bare majority of stockholders to act alone, outside of the open and transparent forum of a stockholders’ meeting.
The Board unanimously recommends that stockholders vote AGAINST this proposal for the following reasons.
Action by Written Consent Can Result in Secretive and Unsound Voting Processes, in Opposition to Nasdaq’s Commitment to Transparent Decision Making
The Board believes that stockholder action by written consent, where there is no open meeting, advance notice, discussion or debate, can result in secretive and unsound decision making by permitting a bare majority of stockholders to act alone, outside of the open and transparent forum of a stockholders’ meeting. Action by written consent deprives stockholders of advance notice of the proposal and the ability to receive and consider the recommendation of the Board, and would allow an action to be proposed and taken by a small group of stockholders, with no fiduciary duties to Nasdaq or other stockholders and without the knowledge or participation of other stockholders, thereby disenfranchising minority stockholders. The Board believes that matters of sufficient importance to warrant action between annual stockholder meetings should not be decided in this manner.
Action by Written Consent Is Unnecessary Given the Ability of Stockholders to Call Special Meetings
Stockholders holding as little as 15% of Nasdaq’s voting power may call a special meeting of stockholders. This right permits Nasdaq’s stockholders to bring important matters before all stockholders for consideration in a transparent manner. Action at a meeting, whether annual or special, is superior to action by written consent because it ensures that stockholders receive advance notice of the matter to be voted upon, allows all stockholders to consider, discuss and vote on stockholder-initiated matters, and provides for a meaningful and structured opportunity to exchange views with the Board before acting.
Action by Written Consent Could Create Confusion and Disruption for Stockholders and the Company
The Board believes that permitting stockholder action by written consent is not appropriate for a widely held public company like Nasdaq. If permitted, multiple stockholder groups could solicit multiple written consents simultaneously, some of which may be duplicative or contradictory, and which has the potential to create substantial confusion and disruption for stockholders.
Nasdaq’s Existing Corporate Governance Structure Provides Numerous Opportunities for Stockholder Action
In addition to providing for stockholders’ right to call special meetings, Nasdaq’s existing corporate governance practices and policies give stockholders ample opportunity to take action at a properly called stockholders’ meeting. Nasdaq has shown time and again that when it believes a particular action requested by a stockholder is in the best interests of all stockholders, the Board will support that action. Significant examples include the following.
- Proxy Access By-Law. In 2016, in response to feedback from stockholders, Nasdaq adopted a proxy access provision that allows a stockholder (or group of stockholders) that complies with certain customary requirements to nominate candidates for service on the Board and have those candidates included in Nasdaq’s proxy materials.
- Majority Voting in Director Elections. Also in response to feedback from stockholders, Nasdaq’s governance documents provide that, in an uncontested election of directors, director nominees are elected by a majority of the votes cast.
- Elimination of Supermajority Voting. Again, in response to feedback from stockholders, Nasdaq has eliminated all supermajority voting requirements from its governance documents.
- Director Nominations. Nasdaq’s By-Laws permit stockholders to nominate persons for election to the Board or propose other business to be considered at an annual or special meeting called by the Board.
- Stockholder Engagement. Nasdaq regularly solicits stockholder views outside the context of formal stockholders’ meetings, considers that input and takes appropriate actions where the long-term interests of all of its stockholders are best served.
Nasdaq believes that these and other corporate governance practices and policies enable stockholders to act in support of their interests while avoiding the risks associated with stockholder action by written consent.
Substantially Identical Proposals Were Rejected by the Company’s Stockholders in 2015 and 2017
The Board has carefully considered the stockholder proposal in light of the rejection by Nasdaq’s stockholders of substantially similar proposals submitted by the same proponent at the 2015 and 2017 Annual Meetings of Stockholders. The Board continues to believe that the actions requested by the proponent are not in the best interests of Nasdaq and its stockholders and urges stockholders to reject the proposal.
As in 2015 and 2017, the Board believes that the stockholder proposal to allow stockholder action by written consent is inappropriate, unnecessary and not in the best interests of Nasdaq and its stockholders.
Nasdaq’s Existing Corporate Governance Structure Provides Numerous Opportunities for Stockholder Action
- Proxy Access By-Law
- Majority Voting in Director Elections
- Elimination of Supermajority Voting
- Director Nominations
- Stockholder Engagement
The Nasdaq Board knows of no business other than the matters described in this proxy statement that will be presented at the Annual Meeting. To the extent that matters not known at this time may properly come before the Annual Meeting, absent instructions thereon to the contrary, the enclosed proxy will confer discretionary authority with respect to such other matters and it is the intention of the persons named in the proxy to vote in accordance with their judgment on such other matters.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act and regulations of the SEC thereunder require our directors, executive officers and persons who beneficially own more than 10% of a registered class of our equity securities to file reports of initial ownership and changes in ownership with the SEC. Based solely on our review of copies of such forms received by Nasdaq, or on written representations from reporting persons that no other reports were required for such persons, we believe that during 2017, our directors, executive officers and 10% stockholders complied with all of the Section 16(a) filing requirements.
Each stockholder is entitled to the number of votes equal to the number of shares of common stock held by such stockholder, subject to the 5% voting limitation contained in our Amended and Restated Certificate of Incorporation that generally prohibits a stockholder from voting in excess of 5% of the total voting power of Nasdaq.
Security Ownership of Certain Beneficial Owners and Management
The following table and accompanying footnotes show information regarding the beneficial ownership of our common stock as of the record date by:
- each person who is known by us to own beneficially more than 5% of our common stock;
- each current director and nominee for director;
- each NEO; and
- all directors and executive officers as a group.
Except as otherwise indicated, we believe that the beneficial owners listed below, based on information furnished by such owners, will have sole investment and voting power with respect to such shares, subject to community property laws where applicable. All vested options, vested shares of restricted stock and vested shares underlying PSUs referred to in the table below were granted under the Equity Plan. Shares of common stock underlying options that are currently exercisable or exercisable within 60 days are considered outstanding and beneficially owned by the person holding the options for the purposes of computing the percentage ownership of that person, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person. Holders of RSUs and PSUs granted under the Equity Plan have the right to direct the voting of the shares underlying those RSUs and PSUs only to the extent the shares are vested.
As of the record date, 166,559,654 shares of common stock were outstanding. Except as noted below, each stockholder is entitled to the number of votes equal to the number of shares of common stock held by such stockholder, subject to the 5% voting limitation contained in our Amended and Restated Certificate of Incorporation that generally prohibits a stockholder from voting in excess of 5% of the total voting power of Nasdaq.
* Represents less than 1%.
1 As of the record date, based solely on information included in an amendment to Schedule 13D, filed March 27, 2012, Borse Dubai had shared voting and dispositive power over 29,780,515 shares. Borse Dubai is a majority-owned subsidiary of Investment Corporation of Dubai and therefore, each of Borse Dubai and Investment Corporation of Dubai may be deemed to be the beneficial owner of the 29,780,515 shares held by Borse Dubai. Borse Dubai and Nasdaq have entered into an agreement that limits Borse Dubai’s voting power to 4.35% of Nasdaq’s total outstanding shares. All of the shares held by Borse Dubai are pledged as security for outstanding indebtedness.
2 As of the record date, based solely on information included in a Form 4, filed May 25, 2012, Innax AB, which was formerly named Patricia Holding AB, had sole voting and dispositive power over 19,394,142 shares. Innax AB is 100% owned and controlled by Investor AB and therefore, each of Innax AB and Investor AB may be deemed to be the beneficial owner of the 19,394,142 shares held by Innax AB.
3 As of the record date, based solely on information included in a Schedule 13G/A, filed February 9, 2018, Massachusetts Financial Services Company indicated that it has beneficial ownership of and sole dispositive power with respect to 14,235,200 shares and sole voting power with respect to 13,383,339 shares.
4 As of the record date, based solely on information included in a Schedule 13G/A, filed February 9, 2018, The Vanguard Group, Inc. indicated that it has beneficial ownership of 11,825,546 shares, sole voting power with respect to 162,274 shares, shared voting power with respect to 24,396 shares, sole dispositive power with respect to 11,645,370 shares and shared dispositive power with respect to 180,176 shares. The Schedule 13G/A includes shares beneficially owned by the following wholly owned subsidiaries of The Vanguard Group, Inc.: Vanguard Fiduciary Trust Company, as a result of its serving as investment manager of collective trust accounts (126,962 shares); and Vanguard Investments Australia, Ltd., as a result of its serving as investment manager of Australian investment offerings (87,708 shares).
5 As of the record date, based solely on information included in a Schedule 13G/A, filed January 23, 2018, BlackRock, Inc. indicated that it has beneficial ownership of and sole dispositive power with respect to 9,043,188 shares and sole voting power with respect to 8,037,939 shares as a result of being a parent company or control person of the following subsidiaries: BlackRock Life Limited; BlackRock International Limited; BlackRock Advisors, LLC; BlackRock Capital Management, Inc.; BlackRock (Netherlands) B.V.; BlackRock Institutional Trust Company, National Association; BlackRock Asset Management Ireland Limited; BlackRock Financial Management, Inc.; BlackRock Japan Co., Ltd.; BlackRock Asset Management Schweiz AG; BlackRock Investment Management, LLC; BlackRock Investment Management (UK) Limited; BlackRock Asset Management Canada Limited; BlackRock (Luxembourg) S.A.; BlackRock Investment Management (Australia) Limited; BlackRock Advisors (UK) Limited; BlackRock Fund Advisors; BlackRock Asset Management North Asia Limited; BlackRock (Singapore) Limited; and BlackRock Fund Managers Ltd.
6 Represents 4,612 vested shares of restricted stock.
7 Represents 26,556 vested shares of restricted stock.
8 Represents (i) 89,605 vested options, (ii) 81,584 vested shares of restricted stock, (iii) 101,434 vested shares underlying PSUs and (iv) 34,451 shares granted under the Equity Plan or purchased pursuant to the ESPP when Ms. Friedman was previously an employee of Nasdaq.
9 Represents 28,226 vested shares of restricted stock. Excludes shares of Nasdaq common stock owned by Borse Dubai. H.E. Kazim, who is Chairman of Borse Dubai, disclaims beneficial ownership of such shares.
10 Represents (i) 5,512 vested shares of restricted stock and (ii) 2,000 shares acquired through open market purchases.
11 Represents 44,808 vested shares of restricted stock.
12 Excludes shares of Nasdaq common stock owned by Investor AB. Mr. Wallenberg, who is Chairman of Investor AB, disclaims beneficial ownership of such shares.
13 Represents (i) 15,000 shares held by a pension insurance fund in the name of FAM AB, which is Mr. Wedenborn’s employer and (ii) 10,000 shares held by a pension insurance fund in the name of Investor AB, which is Mr. Wedenborn’s former employer.
14 Represents (i) 73,813 vested options, (ii) 59,994 vested shares underlying PSUs and (iii) 375 shares of stock purchased pursuant to the ESPP.
15 Represents (i) 13,141 vested shares of restricted stock, (ii) 8,741 vested shares underlying PSUs and (iii) 1,163 shares of stock purchased pursuant to the ESPP.
16 Represents 3,780 vested shares of restricted stock.
17 Represents (i) 18,312 vested shares of restricted stock, (ii) 44,901 vested shares underlying PSUs and (iii) 1,579 shares of stock purchased pursuant to the ESPP.
Nasdaq’s current executive officers are listed below.
|Adena T. Friedman||48||President and CEO|
|P.C. Nelson Griggs||47||EVP, Listing Services|
|Edward S. Knight||67||EVP, General Counsel and Chief Regulatory Officer|
|Lars Ottersgård||53||EVP, Market Technology|
|Bradley J. Peterson||58||EVP and Chief Information Officer|
|Michael Ptasznik||50||EVP, Corporate Strategy and CFO|
|Bjørn Sibbern||44||EVP, Information Services|
|Stacie Swanstrom||48||EVP, Corporate Solutions|
|Thomas A. Wittman||53||EVP, Global Trading and Market Services|
|Ann M. Dennison||47||SVP, Controller and Principal Accounting Officer|
Adena T. Friedman was appointed President and CEO and elected to the Board effective January 1, 2017. Previously, Ms. Friedman served as President and Chief Operating Officer from December 2015 to December 2016. Ms. Friedman rejoined Nasdaq in 2014 as President, after serving as CFO and Managing Director at The Carlyle Group, a global alternative asset manager, from March 2011 to June 2014. Prior to joining Carlyle, Ms. Friedman was a key member of Nasdaq’s management team for over a decade including as head of data products, head of corporate strategy and CFO.
P.C. Nelson Griggs has served as EVP, Listing Services since October 2014. Mr. Griggs is also President of The Nasdaq Stock Market. Previously, Mr. Griggs was SVP, New Listings from July 2012 through October 2014; SVP, Listings Asia Sales from April 2011 through June 2012 and VP, Listings from July 2007 through March 2011. Mr. Griggs joined Nasdaq in 2001 and has served in a variety of other roles within the Listing Services business. Prior to joining Nasdaq, Mr. Griggs worked at Fidelity Investments and a San Francisco based startup company.
Edward S. Knight has served as EVP and General Counsel since October 2000 and Chief Regulatory Officer since January 2006. Previously, Mr. Knight served as EVP and Chief Legal Officer of the Financial Industry Regulatory Authority from July 1999 to October 2000. Prior to joining the Financial Industry Regulatory Authority, Mr. Knight served as General Counsel of the U.S. Department of the Treasury from September 1994 to June 1999. Mr. Knight also serves as a director of Nasdaq Dubai.
Lars Ottersgård has served as EVP, Market Technology since October 2014. Previously, Mr. Ottersgård was SVP, Market Technology from 2008 to October 2014. Mr. Ottersgård joined OMX in 2006 as Global Head of Sales for the company’s commercial technology business. Prior to joining OMX, Mr. Ottersgård held various positions at IBM for twenty years, where he covered the Nordic and European markets and was most recently a senior executive for strategic outsourcing for the distribution and communication industries.
Bradley J. Peterson has served as EVP and Chief Information Officer since February 2013. Previously, Mr. Peterson served as EVP and Chief Information Officer at Charles Schwab, Inc. from May 2008 to February 2013. Mr. Peterson was Chief Information Officer at eBay from April 2003 through May 2008. From July 2001 through March 2003, Mr. Peterson was the Managing Director and Chief Operating Officer at Epoch Securities after its merger with Goldman Sachs Group, Inc. He also has held senior executive positions at Epoch Partners, Inc., Charles Schwab & Company and Pacific Bell Wireless (now part of AT&T).
Michael Ptasznik has served as EVP, Corporate Strategy and CFO since July 2016. Prior to that, Mr. Ptasznik served as CFO of TMX Group Limited from 2002 to 2016. From 1996 to 2002, Mr. Ptasznik held a number of roles at TMX, including VP, Finance and Administration. Prior to TMX, Mr. Ptasznik served in a number of financial roles at Procter & Gamble Canada Inc. from 1990 to 1996.
Bjørn Sibbern has served as EVP, Information Services since October 2016. Previously, Mr. Sibbern served as SVP, Nasdaq Global Commodities from February 2013 to October 2016 and as SVP, Nasdaq Nordic Equities & Equities Derivatives from 2009 to February 2013. Mr. Sibbern also served as President of Nasdaq Copenhagen from 2008 to 2016.
Stacie Swanstrom has served as EVP, Corporate Solutions since October 2016. Previously, Ms. Swanstrom served as SVP, Corporate Solutions from July 2015 to October 2016. Ms. Swanstrom also served as SVP, Global Access Services from December 2013 to July 2015 and as VP from July 2010 to December 2013. Ms. Swanstrom has held a number of other roles at Nasdaq since 1992.
Thomas A. Wittman has served as EVP, Global Trading and Market Services since August 2017. He is also CEO of The Nasdaq Stock Market. Previously, Mr. Wittman was EVP, Global Head of Equities from May 2014 through August 2017, SVP, Head of U.S. Equities and Derivatives from June 2013 through April 2014 and SVP of U.S. Options from March 2010 through June 2013. Mr. Wittman joined Nasdaq in 2008 after Nasdaq acquired The Philadelphia Stock Exchange, where Mr. Wittman began his exchange career in 1987 as a software developer.
Ann M. Dennison has served as SVP, Controller and Principal Accounting Officer since April 2016, after previously serving as SVP and Deputy Controller from October 2015 to March 2016. Prior to joining Nasdaq, Ms. Dennison was employed by Goldman Sachs for 19 years, where she was promoted to Managing Director in 2008. Ms. Dennison joined Goldman Sachs in 1996 from Price Waterhouse.
The Audit Committee of the Board has adopted a written policy requiring notification, review and approval of related person transactions.
Certain Relationships and Related Transactions
The Audit Committee of the Board has adopted a written policy requiring notification, review and approval of related person transactions. In 2017, the Audit Committee reviewed and approved an amendment and restatement of the policy.
Under the policy, all related person transactions are subject to ongoing review and approval or ratification by the Audit Committee. For purposes of the policy, a “related person” generally includes directors, director nominees, executive officers, greater than 5% stockholders, immediate family members of any of the foregoing and entities that are affiliated with any of the foregoing.
Under the policy, related person transactions that are conducted in the ordinary course of Nasdaq’s business and on substantially the same terms as those prevailing at the time for comparable services provided to unrelated third parties are considered pre-approved by the Audit Committee. The Transaction Review Committee (consisting of employees in Finance, Internal Audit, the Office of General Counsel and the Office of the Corporate Secretary) is responsible for determining if a transaction meets the pre-approval requirements. If the pre-approval requirements are not met, the transaction is referred to the Audit Committee for review and approval or ratification.
In determining whether to approve or ratify a related person transaction, the Audit Committee considers, among other things, the following factors:
- whether the terms of the related person transaction are fair to Nasdaq and whether such terms would be on the same basis if the transaction did not involve a related person;
- whether there are business reasons for Nasdaq to enter into the related person transaction;
- whether the related person transaction would impair the independence of an outside director;
- whether the related person transaction would present a conflict of interest for any director or executive officer of Nasdaq, taking into account:
- the size of the transaction;
- the overall financial position of the director or executive officer;
- the direct or indirect nature of the director’s or executive officer’s interest in the transaction; and
- the ongoing nature of any proposed relationship;
- whether the related person transaction is material, taking into account:
- the importance of the interest to the related person;
- the relationship of the related person to the transaction and of related persons to each other;
- the dollar amount involved; and
- the significance of the transaction to Nasdaq investors in light of all the circumstances; and
- whether the related person transaction aligns with Nasdaq’s culture of integrity and potential reputational risk implications.
The following section describes transactions since the beginning of the fiscal year ended December 31, 2017, in which Nasdaq or any of its subsidiaries was a party, in which the amount involved exceeded $120,000 and in which a related person had, or will have, a direct or indirect material interest. In accordance with our policy, all of the transactions discussed below, other than those that received pre-approval as discussed above, have been reviewed and approved or ratified by the Audit Committee of our Board.
As of the record date, Borse Dubai owned approximately 17.9% of Nasdaq’s common stock. Nasdaq is obligated by the terms of a stockholders’ agreement with Borse Dubai to nominate and generally use best efforts to cause the election to the Nasdaq Board of one director designated by Borse Dubai, subject to certain conditions. Essa Kazim, the Chairman of Borse Dubai, has been designated by Borse Dubai as its nominee with respect to the 2018 Annual Meeting.
Nasdaq is party to several commercial agreements with Borse Dubai and/or its affiliates that were negotiated on an arms-length basis and entered into in the ordinary course of business. Under these agreements, during the fiscal year ended December 31, 2017, Borse Dubai or its affiliates paid Nasdaq approximately $2.3 million for market technology products and services. In addition, in consideration for a release by Borse Dubai of certain potential contractual claims, Nasdaq began issuing a credit to Borse Dubai starting in the first quarter of 2017 for approximately $5 million to be applied toward certain technology services provided by Nasdaq.
As of the record date, Investor AB owned approximately 11.6% of Nasdaq’s common stock. Nasdaq is obligated by the terms of a stockholders’ agreement with Investor AB to nominate and generally use best efforts to cause the election to the Nasdaq Board of one director designated by Investor AB, subject to certain conditions. Jacob Wallenberg, the Chairman of Investor AB, has been designated by Investor AB as its nominee with respect to the 2018 Annual Meeting. During the fiscal year ended December 31, 2017, Investor AB or its subsidiaries (i.e., entities that are majority-owned) paid Nasdaq approximately $0.5 million, primarily for listing services and corporate solutions in the ordinary course of business.
OTHER GREATER THAN 5% STOCKHOLDERS
As of the record date, The Vanguard Group, Inc. owned approximately 7.1% of Nasdaq’s common stock. During the fiscal year ended December 31, 2017, Vanguard or its affiliates paid us approximately $1.6 million primarily for transaction services and data products in the ordinary course of business.
As of the record date, BlackRock, Inc. owned approximately 5.4% of Nasdaq’s common stock. During the fiscal year ended December 31, 2017, BlackRock or its affiliates paid us approximately $7.7 million primarily for index licensing services in the ordinary course of business.
OTHER TRANSACTIONS WITH ENTITIES AFFILIATED WITH OUR DIRECTORS
Börje E. Ekholm, one of our former directors, is President and CEO of Ericsson AB. From January 1, 2017 through our annual meeting on May 10, 2017 at which Mr. Ekholm did not stand for re-election, Ericsson or its affiliates paid us approximately $0.2 million primarily relating to market technology products and services in the ordinary course of business.
John D. Rainey, one of our directors, is CFO and EVP of Global Customer Operations of PayPal Holdings, Inc. PayPal or its affiliates paid us $0.3 million during the fiscal year ended December 31, 2017, primarily for listing services and corporate solutions in the ordinary course of business.
Questions and Answers About Our Annual Meeting
|By Internet Using Your Tablet or Smart Phone||By Phone||By Internet Using Your Computer||By Mail||Attend the Annual Meeting|
|Scan this QR code 24/7 to vote with your mobile device||Call +1 800 690 6903 in the U.S. or Canada to vote your shares||Visit 24/7 www.proxyvote.com||Cast your ballot, sign your proxy card and return by free post||Vote in person|
As a beneficial owner, in order to ensure your shares are voted in the way you would like, you must provide voting instructions to your bank, broker or other nominee by the deadline provided in the materials you receive from your bank, broker or other nominee.
1. What is included in the proxy materials? What is a proxy statement and what is a proxy?
The proxy materials for our 2018 Annual Meeting of Stockholders include the Notice of Annual Meeting, this proxy statement and the annual report on Form 10-K. We also will provide an interactive version of the proxy statement at http://ir.nasdaq.com/.
If you received a paper copy of these materials, the proxy materials also include a proxy card or voting instruction form. A proxy statement is a document that SEC regulations require us to give you when we ask you to sign a proxy designating individuals to vote on your behalf. A proxy is your legal designation of another person to vote the stock you own. That other person is called a proxy. If you designate someone as your proxy in a written document, that document also is called a proxy or a proxy card. We have designated two of our officers as proxies for the 2018 Annual Meeting of Stockholders. These two officers are Edward S. Knight and Joan C. Conley. The form of proxy and this proxy statement have been approved by the Board and are being provided to stockholders by its authority.
2. What different methods can I use to vote?
You can vote by any of the following methods.
By Internet. The notice of internet availability of proxy materials contains the website address www.proxyvote.com) for internet proxy submission. Internet proxy submission is available 24 hours a day until 11:59 p.m. (EDT) on April 23, 2018. You must enter your control number, which is printed in the lower right hand corner of the notice of internet availability and you will be given the opportunity to confirm that your instructions have been properly recorded.
By Telephone. In the U.S. and Canada, you can vote your shares by calling +1 800 690 6903. Telephone proxy submission is available 24 hours a day until 11:59 p.m. (EDT) on April 23, 2018. When you submit a proxy by telephone, you will be required to enter your control number. You will then receive easy-to-follow voice prompts allowing you to instruct the proxy holders how to vote your shares and to confirm that your instructions have been properly recorded. If you are located outside the U.S. or Canada, you should instruct the proxy holders how to vote your shares by internet or by mail.
By Mail. If you choose to submit a proxy by mail after requesting and receiving printed proxy materials, simply complete, sign and date your proxy card and return it in the postage-paid envelope provided.
In Person at the Annual Meeting. All stockholders may vote in person at the Annual Meeting. If you wish to attend the Annual Meeting, you will need to follow the instructions set forth in the answer to the next question.
3. What do I need to do to attend the Annual Meeting?
If you wish to attend the Annual Meeting, you must be a stockholder on the record date and request an admission ticket in advance by visiting www.proxyvote.com and following the instructions provided (you will need the 12 digit number included on your proxy card, voter instruction form or notice). Tickets will be issued only to stockholders. Requests for admission tickets will be processed in the order in which they are received and must be requested no later than 11:59 p.m. (EDT) on April 23, 2018. Please note that seating is limited and requests for tickets will be accepted on a first-come, first-served basis.
At the meeting, each stockholder will be required to present valid picture identification, such as a driver’s license or passport, with their admission ticket.
If you are a beneficial owner of Nasdaq shares held by a bank, broker or other nominee, you also will need proof of ownership to be admitted to the meeting. A recent brokerage statement or letter from the bank, broker or other nominee is an example of proof of ownership. If you want to vote in person and your Nasdaq shares are held by a bank, broker or other nominee, you will have to obtain a proxy, executed in your favor, from the holder of record.
Directions to the Annual Meeting are available on our Annual Meeting Information webpage. Cameras (including cell phones with photographic capabilities), recording devices and other electronic devices will not be permitted. You may be required to enter through a security check point before being granted access to the meeting.
Stockholders may submit written questions in advance of the meeting by visiting our stockholder forum at www.proxyvote.com.
4. What is the difference between holding shares as a stockholder of record and as a beneficial owner?
If your shares are registered directly in your name with our registrar and transfer agent, Computershare, you are considered a “stockholder of record” with respect to those shares. If your shares are held in a bank or brokerage account, you are considered the “beneficial owner” of those shares.
5. What if I am a beneficial owner and do not give voting instructions to my broker? What is a broker non-vote?
As a beneficial owner, in order to ensure your shares are voted in the way you would like, you must provide voting instructions to your bank, broker or other nominee by the deadline provided in the materials you receive from your bank, broker or other nominee. If you do not provide voting instructions to your bank, broker or other nominee, whether your shares can be voted by such person depends on the type of item being considered for vote.
Discretionary Items. The ratification of the appointment of Ernst & Young LLP as independent registered public accounting firm is a discretionary item. Banks, brokers and other nominees that do not receive voting instructions from beneficial owners may vote on this proposal in their discretion.
Non-Discretionary Items. All of the other proposals in this proxy statement are nondiscretionary items. Banks, brokers and other nominees that do not receive voting instructions from beneficial owners may not vote on these proposals, resulting in a “broker non-vote.”
If you hold your shares through a bank, broker or other nominee, it is important that you cast your vote if you want it to count on all of the matters to be considered at the Annual Meeting.
6. What proposals are to be voted on at the 2018 Annual Meeting of Stockholders, and what are the voting standards?
|Proposal||Nasdaq Board’s Recommendation||Voting Standard||Effect of Abstentions and Broker Non-Votes|
|1.||Election of ten directors (Non-Discretionary Item)||FOR EACH|
|Majority of votes cast||Not counted as votes cast and therefore have no effect|
|2.||Advisory vote to approve the company’s executive compensation (Non-Discretionary Item)||FOR||Majority of the votes present in person or represented by proxy||Abstentions have the effect of a vote against the proposal; broker non-votes have no effect|
|3.||Approval of the Equity Plan, as amended and restated (Non-Discretionary Item)||FOR||Majority of the votes present in person or represented by proxy||Abstentions have the effect of a vote against the proposal; broker non-votes have no effect|
|4.||Ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2018 (Discretionary Item)||FOR||Majority of the votes present in person or represented by proxy||Abstentions have the effect of a vote against the proposal; there will not be broker non-votes|
|5.||Stockholder proposal – shareholder right to act by written consent (Non-Discretionary Item)||AGAINST||Majority of the votes present in person or represented by proxy||Abstentions have the effect of a vote against the proposal; broker non-votes have no effect|
The proxy provides that each stockholder may vote his or her Nasdaq shares “For,” “Against” or “Abstain” on individual nominees and each of the other proposals. Whichever method you select to transmit your instructions, the proxy holders will vote your shares as provided by those instructions. If you provide a proxy without specific voting instructions, the proxy holders will vote your Nasdaq shares in accordance with the Board recommendations noted above.
The vote to approve executive compensation is advisory only and, therefore, the result of this vote will not be binding on our Board or Management Compensation Committee. Our Board and Management Compensation Committee will, however, consider the outcome of this vote when evaluating our executive compensation program in the future.
The stockholder proposal is precatory, meaning that it requests that the Board take a specific action, and therefore, the results of the vote on that proposal will not be binding on the Board. The Board will consider the outcome of the stockholder vote in considering governance plans for the upcoming year. If the stockholder proposal is not properly presented by the proponent at the Annual Meeting, it will not be voted upon.
7. What can I do if I change my mind after I vote my shares?
You can change your vote by revoking your proxy at any time before it is exercised in one of three ways: submit a later dated proxy (including a proxy submitted through the internet at www.proxyvote.com, by telephone or by proxy card); notify Nasdaq’s Corporate Secretary by email at firstname.lastname@example.org that you are revoking your proxy; or vote in person at the Annual Meeting.
If you are a beneficial owner of Nasdaq shares held by a bank, broker or other nominee, you will need to contact the bank, broker or other nominee to revoke your proxy.
Preliminary results will be announced at the meeting and, thereafter, final results will be reported in a current report on Form 8-K, which is expected to be filed with the SEC within four business days after the meeting.
8. How many votes do I have?
Each share of common stock has one vote, subject to the voting limitation in our Amended and Restated Certificate of Incorporation that generally prohibits a stockholder from voting in excess of 5% of the total voting power of Nasdaq.
9. Are votes confidential?
Proxies, ballots and voting instruction forms are handled on a confidential basis to protect your voting privacy. This information will not be disclosed other than to those recording the vote, except if there is a proxy contest, if the stockholder authorizes disclosure, to defend legal claims or as otherwise required by law. If you write comments on your proxy, ballot or voting instruction form, management may learn how you voted in reviewing your comments.
10. What constitutes a quorum for the Annual Meeting?
The presence of the holders of a majority (greater than 50%) of the votes entitled to be cast at the meeting constitutes a quorum. Presence may be in person or by proxy. Abstentions and broker non-votes are counted as present and entitled to vote at the meeting for purposes of determining a quorum.
11. Who counts the votes?
Broadridge Financial Solutions, Inc. tabulates the votes and acts as the inspector of elections.
12. When will the company announce the voting results?
Preliminary results will be announced at the meeting and, thereafter, final results will be reported in a current report on Form 8-K, which is expected to be filed with the SEC within four business days after the meeting.
13. How are proxies solicited, and what is the cost?
We will pay the cost of soliciting proxies. Proxies may be solicited on our behalf by directors, officers or employees (who will not receive any additional compensation for these solicitations), in person or by telephone, electronic transmission and facsimile transmission. Nasdaq will, upon request, reimburse banks, brokers and other nominees for their reasonable expenses in sending proxy materials to their customers and obtaining their proxies. We have hired D.F. King & Co., Inc. to assist in soliciting proxies at a fee of $8,500 plus costs and expenses for these services.
To participate in the live webcast of the meeting, you can visit our Investor Relations website at http://ir.nasdaq.com/annualmeeting-info.cfm.
14. What is “householding,” and how does it affect me?
Nasdaq has adopted a practice approved by the SEC known as “householding” to reduce printing and postage fees for the meeting notice. “Householding” means that stockholders who share the same last name and address will receive only one copy of proxy materials, unless we receive instructions to the contrary from any stockholder at that address. We will promptly deliver a separate copy of the proxy materials to you if you contact us at the following address, telephone number or email address: Nasdaq Investor Relations Department, Attention: Edward Ditmire, One Liberty Plaza, 49th Floor, New York, New York 10006; +1 212 401 8742; email@example.com. If you wish to receive separate copies of the proxy statement in the future, or if you are receiving multiple copies and would like to receive only one copy per household, you should contact your bank, broker, or other nominee record holder, or you may contact us at the above address, telephone number or email address.
15. Will you make a list of stockholders entitled to vote at the 2018 Annual Meeting of Stockholders available?
We will make a list of holders entitled to vote at the Annual Meeting available at the Annual Meeting and for at least 10 days prior to the Annual Meeting, between the hours of 9:00 a.m. and 5:00 p.m. (EDT), at our principal executive offices (One Liberty Plaza, 50th Floor, New York, New York 10006) and at the meeting location (Nasdaq MarketSite, Four Times Square, New York, NY 10036).
16. If I cannot attend in person, how can I participate in the live webcast of the meeting?
To participate in the live webcast of the meeting, you can visit our Investor Relations website at http://ir.nasdaq.com/annual-meeting-info.cfm. An archived copy of the webcast will also be available on this website.
17. How can I view or request copies of the company’s corporate documents and SEC filings?
Our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports are available free of charge on the “Financials— SEC Filings page” of our Investor Relations website, which can be found at http://ir.nasdaq.com/annual-meeting-info.cfm. We will furnish, without charge, a copy of the annual report on Form 10-K, including the financial statements, to any stockholder upon request to the Nasdaq Investor Relations Department, Attention: Edward Ditmire, One Liberty Plaza, 49th Floor, New York, New York 10006, in writing, or by email at firstname.lastname@example.org.
18. How do I submit a proposal or director nomination for inclusion in the 2019 proxy statement?
Nasdaq stockholders who wish to submit proposals pursuant to Rule 14a-8 of the Exchange Act for inclusion in the proxy statement for Nasdaq’s 2019 Annual Meeting must submit them on or before November 14, 2018 to the Corporate Secretary and must otherwise comply with the requirements of Rule 14a-8.
Our By-Laws include a proxy access provision that permits a stockholder, or a group of stockholders, owning at least three percent of our outstanding shares of common stock continuously for at least three years to nominate and include in the proxy materials for an Annual Meeting director nominees constituting up to the greater of two individuals and 25% of the total number of directors then in office, provided that the stockholder(s) and nominee(s) satisfy the requirements specified in the By-Laws. Notice of director nominations submitted under these requirements must be received no earlier than October 15, 2018 and no later than November 14, 2018.
In addition, Nasdaq stockholders may recommend individuals for consideration by the Nominating & Governance Committee for nomination to the Nasdaq Board. Holders should submit such recommendations in writing, together with any supporting documentation the holder deems appropriate, to Nasdaq’s Corporate Secretary prior to December 31, 2018.
19. How do I submit other proposals or director nominations for presentation at the 2019 Annual Meeting?
Our By-Laws also establish an advance notice procedure for other proposals or director nominations that are not submitted for inclusion in the proxy statement, but that a stockholder instead wishes to present directly at an Annual Meeting. Under these procedures, a stockholder must deliver a notice containing certain information, as set forth in the By-Laws, to Nasdaq’s Corporate Secretary not later than the close of business on the 90th day nor earlier than the close of business on the 120th day prior to the first anniversary of the prior year’s meeting. Assuming the 2019 Annual Meeting is held according to this year’s schedule, the notice must be delivered on or prior to the close of business on January 24, 2019, but no earlier than the close of business on December 25, 2018. However, if Nasdaq holds its Annual Meeting on a date that is more than 30 days before or 70 days after such anniversary date, the notice must be delivered no earlier than the close of business on the 120th day prior to the date of the Annual Meeting nor later than the close of business on the later of (i) the ninetieth day prior to the date of the Annual Meeting or (ii) the tenth day following the day on which public announcement of the date of such meeting is first made by Nasdaq.
Stockholders and other interested parties are invited
to contact the Board by writing us at:
or Nasdaq Board of Directors
c/o Joan C. Conley, SVP and
805 King Farm Boulevard,
Rockville, Maryland 20850