KCG Kcg Holdings Class A

PROPOSAL 1—ELECTION OF DIRECTORS

You are being asked to elect the nine nominees named in this Proxy Statement to serve on the Board of Directors of KCG Holdings, Inc. (which we refer to as “we,” “us,” the “Company” or “KCG”) until the 2015 Annual Meeting of Stockholders and until their successors have been duly elected and qualified, or until their earlier death, resignation or removal. Each nominee currently serves on our Board of Directors (which we refer to as “Board of Directors” or “Board”).

We do not know of any reason why any nominee named in this Proxy Statement would be unable to serve as a director if elected. If any nominee is unable to serve, the shares represented by all valid proxies will be voted for the election of such other person as may be nominated in accordance with our Amended and Restated By-Laws (the “By-Laws”), as described below. Proxies cannot be voted for a greater number of persons than the number of nominees named in this Proxy Statement.

The Board unanimously recommends you vote “ FOR ” each of the nominees described below.

Nominees for Election as Directors

Article 5 of our By-Laws provides the procedures for the nomination and composition of our Board of Directors during the three-year period following the Mergers (which ends on July 1, 2016), which we refer to as the “specified period.” During the specified period, four of our directors will be directors who were nominated to be directors by either the Board of Directors of Knight prior to the Mergers or their successors nominated as described below, whom we refer to as “Knight Directors,” and five will be persons who were nominated to be directors either by the Board of Directors of GETCO prior to the Mergers or their successors nominated as described below, whom we refer to as “GETCO Directors.” In addition, during the specified period, subject to the independence rules described in “Director Qualifications and Independence—Director Independence” below, the Knight Directors will have the exclusive authority to nominate, on behalf of the Board, directors to fill each seat previously held by a Knight Director, and the GETCO Directors will have the exclusive authority to nominate, on behalf of the Board, directors to fill each seat previously held by a GETCO Director. Article 5 of our By-Laws provides that at all times, at least three of the Knight Directors and two of the GETCO Directors must be independent in accordance with New York Stock Exchange (“NYSE”) listing requirements.

As required by Article 5 of our By-Laws following the Mergers, we formed a Knight Directors Committee, which is comprised of all of the Knight Directors, and a GETCO Directors Committee, which is comprised of all of the GETCO Directors. Our Nominating and Corporate Governance Committee, which we refer to as the “N&CG Committee,” recommended to the Knight Directors Committee and the GETCO Directors Committee, as appropriate, the nomination of each nominee named below. After considering the recommendation of the N&CG Committee and the requirements set forth in Article 5 of our By-Laws, Mr. Haldeman, Mr. Milde, Mr. Schmitt and Ms. Shahon, each a Knight Director, were nominated by the Knight Directors Committee, and Mr. Coleman, Mr. Kern, Mr. Morris, Mr. Schuler and Mr. Tierney, each a GETCO Director, were nominated by the GETCO Directors Committee.

During the specified period, all vacancies on the Board created by the cessation of service of a Knight Director will be filled by a nominee chosen by the remaining Knight Directors, and all vacancies on the Board created by the cessation of service of a GETCO Director will be filled by a nominee chosen by the remaining GETCO Directors, in each case, after considering the recommendation of the N&CG Committee. Directors chosen to fill vacancies will hold office for a term expiring at the end of the next annual meeting of stockholders and until the director’s successor is duly elected or qualified, or until the director’s earlier death, resignation or removal.

Our Board believes that each of the following nominees meet the criteria described below with diversity and depth of experience that enable them to effectively oversee management of the Company. No nominee for director has a family relationship with any nominee for director or executive officer of the Company. Information relating

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to each nominee for election as director, including his or her period of service as a member of the Board of Directors, principal occupation, specific experience, other biographical material and qualifications is described below:

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Term

Each director elected will hold office until the 2015 Annual Meeting of Stockholders and until the director’s successor is duly elected or qualified, or until the director’s earlier death, resignation or removal. Any director may resign at any time upon written notice to the Company.

Majority Voting Standard for Election of Directors

Under our By-Laws, in an uncontested election of directors, each director will be elected if a majority of the votes cast at any meeting at which a quorum is present are for the election of the director. For these purposes, votes cast include directions to withhold authority and exclude abstentions with respect to the director’s election.

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In the event of a contested election, in which the number of candidates for election as directors exceeds the number of directors to be elected, each director will be elected by the vote of a plurality of the votes cast at any meeting at which a quorum is present.

If a nominee for director who is an incumbent director is not elected and no successor has been elected at the meeting, the director will promptly tender his or her resignation to the Board. The N&CG Committee will recommend to the Board whether to accept the tendered resignation or whether other action should be taken. The Board will then act on the tendered resignation, taking into account the N&CG Committee recommendation, and publicly disclose its decision within 90 days from the date of certification of election results. The Board and N&CG Committee, in making such a determination and recommendation, may consider any factors or information as they considered appropriate and relevant.

If the director’s resignation is not accepted by the Board, the director will serve until the next annual meeting and until his or her successor is duly elected, or until his or her subsequent voluntary early resignation or removal. If, during the specified period, the director’s resignation is accepted by the Board, or if a nominee is not elected and is not an incumbent director, then the resulting vacancy on the Board will be filled by a nominee chosen by the Knight Directors Committee or the GETCO Directors Committee, depending upon whether the departing director is a Knight Director or a GETCO Director.

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CORPORATE GOVERNANCE

BOARD LEADERSHIP

Our Board Leadership Structure

Our Board is currently led by an independent director serving as Non-Executive Chairman, Mr. Haldeman. The Board has determined that having an independent director serve as the Non-Executive Chairman of the Board is in the best interests of stockholders because it allows the Chairman to focus on the effectiveness and independence of the Board while the CEO focuses on executing the Company’s strategy and managing the Company’s operations and performance. As the independent, Non-Executive Chairman, Mr. Haldeman presides over meetings of the stockholders and the Board of Directors at which he is present. At this time, the Board believes this structure is an important mechanism for enhancing the governance practices of the Board, ensuring that independent and open discussions occur amongst independent directors and between directors and management and facilitating a leadership position within the Board. The Board maintains the authority at all times to modify this structure if necessary when doing so would be in KCG’s best interests.

Our Board believes that the current leadership structure is efficient and in the best interests of the Company for the following reasons:

DIRECTOR QUALIFICATIONS AND INDEPENDENCE

Director Qualifications

Our By-Laws provide that our Board of Directors initially consist of nine directors, of which four were nominated by Knight and five were nominated by GETCO, in each case prior to the closing of the Mergers. Our By-Laws further provide that during the specified period, which ends on July 1, 2016 (the third anniversary of the closing of the Mergers), four of our directors will be Knight Directors and five of our directors will be GETCO Directors. After considering the recommendation of the N&CG Committee, the Knight Directors Committee will have the exclusive authority to nominate, on behalf of the Board, directors to fill each seat previously held by a Knight Director, and the GETCO Directors Committee will have the exclusive authority to nominate, on behalf of the Board, directors to fill each seat previously held by a GETCO Director, subject in each case to the independence requirements discussed below.

Subject to Article 5 of our By-Laws, the N&CG Committee’s principal responsibilities are to assist the Board in reviewing and identifying individuals qualified to become Board members, consistent with criteria approved by the Board, and to recommend to the Board nominees for directors for the next annual meeting of stockholders and to fill vacancies on the Board.

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Our N&CG Committee has established in its charter criteria to be considered in considering an individual for nomination to the Board. Director nominees should:

We also seek to select a diverse group of directors for nomination to the Board, with diversity reflecting a range of talents, ages, professional skills, background and experience. There is no formal process for implementing this policy, but diversity is considered by the Board in determining overall Board composition.

During the specified period, our N&CG Committee will consider and make recommendations to the Knight Directors Committee and the GETCO Directors Committee, as appropriate, regarding nominees to the Board. The Knight Directors Committee and the GETCO Directors Committee, as appropriate, will consider the recommendations of the N&CG Committee and make all nominations to the Board in accordance with Article 5 of our By-Laws.

Additionally, our Corporate Governance Guidelines (a copy of which may be found on our website at www.kcg.com in the “Corporate Governance” section of “Investors”) set forth a list of factors that, absent a waiver by a majority of the Board or pursuant to Article 5 of our By-Laws, will disqualify an individual from service on our Board. These factors require that a director not :

Our N&CG Committee is responsible for determining annually whether each current director is subject to any of the above factors and reporting to the Board on its determinations. If a director is subject to any of the disqualifying factors or experiences a substantial change in occupation or business association, absent a waiver by a majority of the Board (excluding the affected director(s)), he or she will immediately offer his or her resignation, which the Board will accept.

Term Limits

Absent a waiver by a majority of our Board, our Corporate Governance Guidelines limit directors (other than the CEO) to 15 one-year terms on our Board and require that directors resign from the Board effective as of the Board meeting following the date the director reaches 72 years of age.

Director Independence

To be independent under NYSE rules, our Board must make an affirmative determination that a director does not have a “material relationship” with KCG (either directly or as a partner, stockholder or officer of an organization that has a material relationship with KCG). The NYSE has bright-line tests that disqualify a director

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from being determined to be independent, including if the director is employed by KCG. In addition, the Board must still consider all circumstances surrounding any existing relationship between KCG and a director to determine whether a material relationship exists outside of the bright-line tests.

Our Board has considered the independence of all nine of our directors and has made an affirmative determination that our independent directors are Charles E. Haldeman, Jr., Rene Kern, James T. Milde, John C. (Hans) Morris, Daniel F. Schmitt and Laurie M. Shahon. As our CEO, Daniel Coleman is not independent. In addition, we have determined that Stephen Schuler and Daniel Tierney, as the founders and former managers of GETCO, a wholly-owned subsidiary of KCG, are not currently independent.

The members of the Knight Board prior to the Mergers were William L. Bolster, Martin J. Brand, Thomas Joyce, James W. Lewis, James T. Milde, Matthew Nimetz, Christopher C. Quick, and Frederic J. Tomczyk, each of which was deemed to be an independent director by the Knight Board other than Mr. Joyce.

Our Standards of Independence; Related Party Transactions

Our Corporate Governance Guidelines require that at least a majority of the directors on our Board be “independent” as defined under the NYSE Listing Standards. Additionally, our By-Laws require that, through July 1, 2016, at least three of the four Knight Directors and two of the five GETCO Directors be independent in accordance with NYSE listing requirements.

Directors also are required under our Corporate Governance Guidelines to abide by our Code of Business Conduct and Ethics (a copy of which may be found at our website at www.kcg.com in the “Corporate Governance” section of “Investors”), and each director must recuse himself or herself from any discussion or decision affecting his or her personal, business or professional interests unrelated to his or her service on the Board. Unless an exception is granted by a majority vote of our Board and excluding service with non-profit institutions, no director may serve on more than two boards of public companies in addition to our Board, and no director may serve on the board of an entity that has one or more executive officers serving as a member of our Board.

In determining that each of the directors, other than Messrs. Coleman, Schuler and Tierney, is independent, our Board reviewed these standards, the corporate governance rules of the NYSE and the SEC, and the individual circumstances of each director.

Our Code of Business Conduct and Ethics requires all employees to disclose to KCG any conflicts of interest or personal interests they may have in potential transactions. After full disclosure by an employee, the Company may approve the conduct or transactions at issue in writing. Members of the Board must disclose to the Board any personal interest they may have in a transaction in which the Board is involved and recuse themselves from participation in any decision in which there is a conflict between their personal interests and the interests of the Company.

Additionally, the charter for the Finance and Audit Committee, which we refer to as the “F&A Committee,” includes a requirement for the F&A Committee to review and approve proposed related party transactions or courses of dealings with respect to which significant stockholders or executive officers or directors or members of their immediate families have an interest, including all transactions required to be disclosed pursuant to Item 404 of Regulation S-K. A related party transaction is a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which KCG was, is or will be a participant and the amount involved exceeds $120,000 in any fiscal year, and in which any “related party” (defined below) had, has or will have a direct or indirect material interest. The category of related parties consists generally of KCG’s directors, director nominees, executive officers, any person or entity who is known to be the beneficial owner of more than 5% of any class of KCG voting securities, and immediate family members of any of the foregoing persons. The following discussion of related party transactions includes transactions entered into by Knight and its subsidiaries with related parties during the period in 2013 prior to the Mergers, and transactions entered into by KCG and its subsidiaries during the period in 2013 following the Mergers.

Prior to the Mergers, Knight participated in transactions and had relationships with certain beneficial owners of over five percent of its Class A common stock or securities convertible into its Class A common stock

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(collectively, the “Knight common stock”). In each case, the ordinary course trading relationships described below began prior to the time that each entity became a beneficial owner of more than five percent of the Knight common stock.

Prior to the closing of the Mergers in 2013, each of GETCO, Jefferies LLC (formerly Jefferies & Company and, together with certain of its affiliates, “Jefferies”), and TD Ameritrade Holding Corporation (“TD Ameritrade”) was a beneficial owner of more than five percent of the Knight common stock. Frederic C. Tomczyk, the President and CEO of TD Ameritrade, was also a director of Knight in 2013 prior to the closing of the Mergers. During that time period, Knight (i) earned revenues of $349,600 from transactions with GETCO, and made payments of $2,550,419 to GETCO, (ii) earned revenues of $1,056,019 from Jefferies and made payments of $136,716 to Jefferies and (iii) earned revenues of $13,513,388 from transactions with TD Ameritrade, and made payments of $12,153,457 to TD Ameritrade, in each case related to the ordinary course trading relationships that Knight maintained with GETCO, Jefferies and TD Ameritrade, respectively. In addition, after the closing of the Mergers in 2013, KCG earned revenues of $14,738,076 from Jefferies and made payments of $152,935 to Jefferies, in each case related to KCG’s ordinary course trading relationships with Jefferies.

Upon the closing of the Mergers, Jefferies was (and remains as of April 1, 2014) the beneficial owner of more than five percent of KCG’s Class A common stock, par value $0.01 per share (the “Common Stock”). Jefferies acted as financial advisor to GETCO in connection with the Mergers, for which GETCO paid Jefferies fees of $13,900,000 prior to or upon the closing of the Mergers. GETCO also agreed to reimburse Jefferies for certain of its fees and expenses as financial advisor, including fees and expenses of its counsel. KCG also paid Jefferies total fees of $34,400,163 in 2013 in connection with its service as documentation agent, administrative agent, collateral agent, syndication agent, and arranger and book manager for KCG’s first lien senior secured credit agreement (the “Credit Agreement”), as a committed bank and arranger of an acquisition bridge financing facility, and as an initial purchaser of KCG’s 8.250% senior secured second lien notes (the “Senior Secured Notes”). Although these fees were incurred by GETCO prior to the closing of the Mergers pursuant to a commitment letter between GETCO and Jefferies, they were paid by KCG on or after the closing. GETCO also agreed to reimburse Jefferies for certain of its fees and expenses in connection with the financings described above, including fees and expenses of its counsel, as well as agreed to reimburse Jefferies for certain of its ongoing fees and expenses in connection with the administration of the Credit Agreement. These reimbursements to Jefferies were paid after the closing of the Mergers and totaled $270,616.

In October 2013, KCG paid Jefferies, as solicitation agent, a solicitation fee in the amount of $1,264,945 in connection with the solicitation of consents from the registered holders of the Senior Secured Notes to amend the terms of the Senior Secured Notes.

BOARD OVERSIGHT OF RISK

Successful management of the Company requires identifying, monitoring and managing risk. Risk oversight begins with the Board of Directors and two key Board committees: the Risk Committee and the F&A Committee.

Our Board’s Risk Committee meets at least on a quarterly basis to review and assess our risks, control processes with respect to such risks, and our risk management and fiduciary policies and activities. The Risk Committee meets at least annually with our F&A Committee to review and discuss the Company’s risk management policies, procedures and insurance coverage. As set forth in our Risk Committee’s Charter, our Risk Committee’s responsibilities include, among others:

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Our Board’s F&A Committee also plays a role in risk oversight. Our F&A Committee has oversight responsibility of the integrity of the Company’s financial statements and its risk and control environment, the relationship with the Company’s independent auditor and the Company’s internal audit function. At the management level, the internal audit function is responsible for providing reliable and timely information to our Board and management regarding the Company’s effectiveness in identifying and appropriately controlling risks. The F&A Committee meets with our Director of Internal Audit, the Chief Financial Officer and the independent auditor in separate private sessions at least quarterly to discuss any matters that may warrant committee attention.

The F&A Committee consists of independent directors who meet the independence, experience and financial literacy requirements of The Sarbanes-Oxley Act of 2002 (the “SOX Act”), the NYSE and applicable rules of the SEC. In addition, at least one member of the F&A Committee must be an audit committee financial expert under SEC rules (or the F&A Committee will advise the Company that none of its members so qualifies). The Board has determined that Mr. Schmitt is an audit committee financial expert.

The Company’s independent auditor reports directly to the F&A Committee, which has the sole authority to appoint or replace the independent auditor and to approve all audit engagement fees and terms and all permitted non-audit engagements. The F&A Committee also has the sole authority to hire and replace the Director of Internal Audit.

The following responsibilities, among other things, are within the authority of the F&A Committee:

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Our primary risk exposures as well as our risk management framework and methodologies are discussed in further detail on pages 54 to 57 in our Annual Report on Form 10-K for the year ended December 31, 2013. See “Compensation and Risk” on page 20 below for a discussion of risk assessment as it relates to our compensation program.

BOARD MEETINGS AND BOARD COMMITTEE INFORMATION

Board Meetings

Our current Board of Directors was appointed in connection with the Mergers on July 1, 2013, except for Mr. Haldeman, who was elected to the Board effective November 2013. Since the Mergers, our Board held 10 meetings in 2013. The Knight Board also met 10 times in 2013 prior to the closing of the Mergers. Our Corporate Governance Guidelines provide that our directors are expected to attend all regular and special meetings of our Board and committees on which they sit. During the period in 2013 prior to the closing of the Mergers, each director of Knight attended at least 75% of the aggregate number of meetings of the Knight Board and of the committees on which he or she was a member (during the period he or she was a member). Since the Mergers, for 2013, each KCG director attended at least 75% of the aggregate number of meetings of our Board and of the committees on which he or she was a member (during the period he or she was a member), except for Stephen Schuler, who attended over two-thirds of the meetings but missed certain meetings due to medical reasons.

Committees and Committee Charters

Following the Mergers, our Board established several standing committees, including the F&A Committee, the N&CG Committee, the Compensation Committee and the Risk Committee. Each of the committees makes recommendations to our Board as appropriate and reports periodically to the entire Board. The charters of each committee are available on our website at www.kcg.com in the “Corporate Governance” section of “Investors.”

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The following table identifies the individual members of our Board serving on each of the standing committees as of the date of this Proxy Statement. Assuming re-election to the Board, the committee memberships for the 2014 term following our Annual Meeting will be unchanged.

Finance and Audit Committee

Since the Mergers, our F&A Committee, which consists entirely of independent directors, held five meetings in 2013. The Knight Finance and Audit Committee (consisting of William L. Bolster, James W. Lewis and Daniel F. Schmitt) met six times in 2013 prior to the closing of the Mergers. The F&A Committee of the Board of Directors assists the Company’s Board of Directors in fulfilling its oversight of (1) the integrity of the financial statements and its risk and control environment, (2) the qualification of, and relationship with, the independent registered public accounting firm, (3) the Company’s internal audit function, (4) compliance with applicable legal and regulatory requirements and (5) compliance with the Company’s Code of Business Conduct and Ethics. The F&A Committee also reviews and makes recommendations to the Board regarding (1) any proposed material capital formation plans, including planned issuances of equity securities and debt instruments, and stock repurchase programs and (2) certain acquisitions, investments, new business ventures, and divestitures by the Company. The F&A Committee annually reviews and approves the Company’s (1) treasury investment policy outlining the general investment objectives of the Company and the specific instruments for which investments are permitted, (2) liquidity risk management policy and (3) contingency funding plan.

Our F&A Committee has direct responsibility for the appointment, compensation, evaluation, retention and oversight of the work of the independent registered public accounting firm, which has been engaged to prepare an audit report or to perform other audit, review or attest services for or on behalf of the Company. The F&A Committee is responsible for the pre-approval of all audit and permitted non-audit services performed by our independent registered public accounting firm. The independent registered public accounting firm reports directly to the F&A Committee. The F&A Committee’s function is one of oversight, recognizing that our management is responsible for preparing our financial statements, and our independent registered public accounting firm is responsible for auditing those statements. Annually, the F&A Committee evaluates the independent registered public accounting firm and, as appropriate, recommends that our Board request stockholder ratification of the appointment of the independent registered public accounting firm.

The F&A Committee also acts on behalf of our Board in monitoring and overseeing the performance of our internal audit function. At least annually, the F&A Committee reviews the organizational structure, qualifications, independence and performance of this function and the scope of its planned activities. The F&A Committee also oversees the operation of a comprehensive system of internal controls covering the integrity of

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our financial statements and reports, compliance with laws, regulations and corporate policies. See “Board Oversight of Risk” beginning on page 10 above for additional discussion of the F&A Committee’s duties and responsibilities.

Our Board of Directors has determined that the F&A Committee consists entirely of directors who meet the independence requirements of the listing standards of the NYSE and Rule 10A-3 under the Securities Exchange Act of 1934, as amended, which we refer to as the “Exchange Act.” Our Board has also determined that all members of its F&A Committee are financially literate and have accounting or related financial management expertise within the meaning of the NYSE listing standards as interpreted by our Board. Our Board has determined in its business judgment that Mr. Schmitt satisfies the definition of “audit committee financial expert” as set out in the rules and regulations under the Exchange Act, based upon his experience actively supervising a principal accounting or financial officer or public accountant. The SEC provides that an “audit committee financial expert” does not have additional duties, obligations or liabilities and is not considered an expert under the Securities Act.

Nominating and Corporate Governance Committee

Since the Mergers, our N&CG Committee, which consists entirely of independent directors, held three meetings in 2013. The Knight Nominating and Corporate Governance Committee (consisting of William L. Bolster, James W. Lewis, James T. Milde, Christopher C. Quick, Daniel F. Schmitt and Laurie M. Shahon) did not meet in 2013 prior to the closing of the Mergers. Subject to our By-Laws, the N&CG Committee is responsible for identifying individuals qualified to become Board members consistent with the criteria included in the N&CG charter and our Corporate Governance Guidelines, including candidates recommended by stockholders in compliance with procedures set forth in the By-Laws, and to recommend that the Board select these individuals as nominees for election to the Board. Stockholders who wish to nominate directors directly at an annual meeting in accordance with the procedures in our By-Laws should follow the instructions in the section entitled “Stockholder Proposals for 2015 Annual Meeting” on page 65. Other functions of the N&CG Committee include (1) recommending the size of, and directors to serve on, committees of the Board, (2) advising the Board with respect to matters of Board composition and procedures, (3) developing and recommending to the Board a set of corporate governance principles applicable to the Company and overseeing corporate governance matters generally and (4) overseeing the annual evaluation of our management and the Board.

Compensation Committee

Since the Mergers, our Compensation Committee, which consists entirely of independent directors, held six meetings in 2013. The Knight Compensation Committee (consisting of William L. Bolster, James T. Milde, Christopher C. Quick and Laurie M. Shahon) met seven times in 2013 prior to the closing of the Mergers. The Compensation Committee has responsibility for approving and evaluating executive officer compensation, incentive compensation and equity-based plans, policies and programs of the Company and its subsidiaries. The Compensation Committee also evaluates the performance of our CEO, and, based on such evaluation, reviews and approves his annual salary, cash incentive bonus and long-term equity incentive bonus. The Compensation Committee is responsible for producing an annual report on executive compensation and assisting management in the preparation of a compensation discussion and analysis. Additionally, the Compensation Committee may retain and/or terminate outside compensation consultants to assist in the evaluation of executive officer compensation and has the authority to obtain advice and assistance from internal or external legal, accounting, and other advisors.

The Compensation Committee also provides assistance to the Board of Directors by setting performance-based compensation criteria for our CEO and other key executives, certifying the results of such performance at the end of the annual performance period and awarding the resulting performance-based compensation and making equity grants to such key executives.

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Risk Committee

Since the Mergers, our Risk Committee held two meetings in 2013. The Knight Risk Committee (consisting of James T. Milde, Matthew Nimetz and Fredric J. Tomczyk) met three times in 2013 prior to the closing of the Mergers. The primary purpose of the Risk Committee is to assist the Board in its oversight responsibilities relating to the identification, monitoring and assessment of the key risks of the Company, including the significant policies, procedures and practices employed in risk management. See “Board Oversight of Risk” beginning on page 10 above for a discussion of the Risk Committee’s duties and responsibilities.

EXECUTIVE COMPENSATION CONSULTANT TO THE COMPENSATION COMMITTEE

Following the Mergers, the Compensation Committee engaged a compensation consulting firm, Pay Governance LLC (“Pay Governance”), to serve as its external compensation consultant since the Mergers. Pay Governance previously provided guidance and advice to both GETCO and the Knight Compensation Committee prior to the Mergers. As discussed in more detail below and under “Executive Compensation,” Pay Governance provided information that informed post-merger 2013 decision making. Pay Governance received fees of $337,169 in 2013 for its services to KCG and GETCO related to executive compensation design following the closing of the Mergers and 2013 executive compensation matters, and $12,825 in 2013 for its services to Knight related to 2012 compensation matters.

The information provided by Pay Governance included: competitive salary, bonus and equity data for certain positions within KCG and general benchmarking data against our peers. In addition, Pay Governance assisted with the design, and provided analysis, of our bonus and equity award programs and provided advice related to the selection of our peer group. Our named executive officers did not participate in the selection of Pay Governance or any other compensation consultant in connection with advice regarding executive and director compensation matters. A representative from Pay Governance attends most Compensation Committee meetings and is available between meetings as a resource for the Compensation Committee and management. The Compensation Committee determines in its sole discretion which compensation consultant to retain for various services, and the consultant reports directly to the Compensation Committee. Use of a particular consulting firm by the Compensation Committee does not preclude management from hiring the same consulting firm. In 2013, Pay Governance did not provide services to KCG management. In compliance with SEC and NYSE requirements regarding the independence of compensation consultants, Pay Governance provided the Compensation Committee a letter addressing each of the six independence factors listed in those requirements. Their responses affirm the independence of Pay Governance and the partners, consultants, and employees who service the Compensation Committee on executive compensation matters and governance issues.

For 2013, Pay Governance prepared an annual, comprehensive benchmarking report based on KCG’s peer group that was used by the Compensation Committee in making decisions regarding base salary, annual bonuses and equity compensation. Pay Governance’s analysis focused on a review of competitive compensation practices for a sample of the officer positions at KCG, based on proxy statement data for the companies in our peer group, as well as published survey data. Relevant findings from this analysis are discussed in more detail in our “Compensation Discussion and Analysis” herein.