KKR Kkr & Co. Inc. - 10-K

ITEM 1A. RISK FACTORS

You should carefully consider the risks described below and the other information contained in this report and other

filings that we make from time to time with the SEC, including our consolidated financial statements and accompanying notes.

Any of the following risks could materially and adversely affect our business, financial condition, results of operations, cash

flows, and prospects.  Many risks discussed in this report also impact our investment vehicles, portfolio companies and other

investments, including balance sheet investments, which may, in turn, materially and adversely impact KKR.  When discussing

our risks in this report, unless the context requires otherwise, references to (i) our investments include our portfolio

companies, which are typically companies in which we have a controlling equity interest or other investment with significant

influence, (ii) investors refers to the investors in our funds and other investment vehicles, and (iii) investments that we make

or own on our balance sheet include the portfolio companies reported in our Strategic Holdings segment and investments

held by our insurance subsidiaries.  We could also be materially and adversely affected by other risks that are not known to us

or that we currently believe to be immaterial.  The following risk factors have been organized by category within risks related

to our business, regulatory framework, investment activities, insurance activities, and our organizational structure; however,

many of the risks are interrelated, and as a result, should be read together to fully understand the risks involved with

investing in our securities.  See also “Business—Regulation” and “Management’s Discussion and Analysis of Financial

Condition and Results of Operations” for a discussion of certain business, competitive, regulatory, market, economic and

other conditions that may materially and adversely affect us.

Risks Related to Our Business

Difficult market and economic conditions can, and periodically do, materially and adversely affect KKR.

Our business is materially affected by market and economic conditions and events throughout the world, including

conditions relating to interest rates, fiscal and monetary stimulus (and stimulus withdrawal), availability of credit, inflation

rates, economic growth, changes in laws, trade barriers, commodity prices, foreign exchange rates and controls, and liquidity

conditions in equity and debt capital markets.  These market and economic conditions are not in our control and are often

difficult, if not impossible, to predict, manage, mitigate, hedge or foresee.  Examples of how market and economic conditions

may materially and adversely affect our business and financial results include negative impacts to us from any or all of the

following:

• the performance and value of the investments held by us and our investment vehicles,

• opportunities for us and our investment vehicles to make, exit and realize value from our and their investments,

• our ability to find suitable investments or secure financing for investments on attractive terms, or at all,

• the attractiveness of our investment vehicles and insurance products to investors and policyholders, respectively,

including our ability to raise capital for new or successor funds and other investment vehicles on attractive terms,

• the frequency and size of fees generated from our capital markets business in connection with the issuance and

placement of equity and debt securities, loans and credit facilities,

• the availability and cost of capital for our insurance subsidiaries and our investment vehicles’ portfolio companies,

• policyholder behavior, including policyholders electing to defer paying insurance premiums, stop paying insurance

premiums altogether, or surrender their policies, and

• the cost of providing guaranteed insurance benefits, insurance capital requirements and collateral requirements.

See also “—Risks Related to our Investment Activities—Various conditions and events outside of our control that are

difficult to quantify or predict may have a significant impact on the valuation of our investments” below.

Global, regional and local events outside of our control, including geopolitical events and natural

disasters, could materially and adversely impact KKR.

We are a global financial institution with operations, investors and investments located around the world.  Geopolitical

developments, including the imposition of protectionist measures by countries such as sanctions, restrictions on foreign direct

investment, trade barriers, tariffs, export controls and other governmental actions related to international trade agreements

and policies that materially constrain cross-border flows of capital, goods, or data, may impact our investment activities and

investments.  In addition, other geopolitical developments such as political instability, civil unrest, and national and

international security events (including the outbreak of war, military action, terrorist acts or other hostilities), can, and

occasionally do, materially and adversely impact our ability to conduct our investment management and insurance

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businesses, in addition to our investments.  These risks have increased in both scale and complexity due to intensifying

geopolitical competition and conflicts, including the ongoing Russian invasion of Ukraine, instability in the Middle East,

heightened geopolitical competition between China and other major world economies, heightened levels of political populism

leading to regulatory volatility, growing use of industrial policy globally (including the imposition of tariffs and other trade and

capital barriers), and increased attention to global threats.  We are subject to these risks as we own and seek to own

businesses throughout the world, have offices and employees in multiple countries and seek investors throughout the world

for our investment products and certain of our insurance products.

We are also affected by natural disasters or catastrophes, such as public health crises, pandemics, epidemics, security

events, and weather events, any of which could have an adverse impact on our ability to conduct our investment

management and insurance businesses.  Potential changes in climatic conditions, together with the response or failure to

respond to these changes, could precipitate the frequency, severity, and impact of natural disasters or catastrophes.

Such events outside of our control could limit or even materially prohibit our ability to conduct any operations or

investment activities in certain locations.  In addition, claims arising from the occurrence of such events could have an adverse

effect on our insurance activities, in particular with respect to increases in the number of claims, lapses and surrenders of

existing policies, as well as sales of new policies.  These events outside of our control, and actions taken in response to them,

may contribute to significant volatility in the financial markets, resulting in increased volatility in equity prices (including our

common stock), valuation, material interest rate changes, supply chain disruptions, such as simultaneous supply and demand

shock to global, regional and national economies, and an increase in inflationary pressures.  These events and the disruptions

that they cause, alone or in combination, also have the potential to strain or deplete our infrastructure and response

capabilities generally, and to increase costs, including costs of insurance, each of which could materially and adversely affect

us.  See also “—Risks Related to Our Investment Activities—Investments in real assets may expose us and our investment

vehicles to greater risks, liabilities and operational complexities than investments in operating companies.”

We may have direct investments in a region or a country that is experiencing one of the aforementioned events, and we

may also be materially and adversely affected by the occurrence of such events as a result of indirect exposure that our

portfolio companies or other investments may have through other interconnectivities such as supply chains, commodity

prices and general macroeconomic exposure.  These events, including barriers to investment between the U.S. and other

countries or regions, could chill or limit business opportunities, adversely impact the value of our investments, increase costs,

decrease margins, reduce the competitiveness of products and services offered by portfolio companies, and adversely affect

the revenues and profitability of portfolio companies.

The loss of key personnel or their services, or any misconduct by key personnel, could have a material

adverse effect on KKR.

Our Co-Founders, Co-Chief Executive Officers, employees, and other key personnel, including certain consultants and

advisors, possess substantial experience and expertise and have strong business relationships with investors in our

investment funds, other members of the business community and distributors of our investment vehicles and insurance

products.  As a result, the loss of key personnel could jeopardize our relationships with these individuals and entities, result in

the reduction of AUM or investment opportunities, or render us unable to maintain operations and support growth of our

businesses.  The loss of services of key personnel could also harm our ability to maintain or grow AUM in existing investment

vehicles or raise additional funds in the future. Competition is also intense for the attraction and retention of qualified

employees and consultants, including those with industry-specific expertise. Our ability to continue to compete effectively in

our businesses will depend upon our ability to attract new investment professionals, insurance professionals, other

employees, and consultants and retain them accordingly. In addition, changes in employee compensation as a result of the

modification of our compensation framework or poor investment or financial performance may impact our ability to hire,

retain, and motivate our employees whom we depend.

Furthermore, the agreements governing our committed capital funds generally provide that in the event certain “key

persons” cease to actively manage an investment vehicle or be substantially involved in KKR activities, investors in the

investment vehicle may reduce, in whole or in part, their capital commitments available for further investments on an

investor-by-investor basis, which could indirectly lead to a limitation on the fund’s ability to conduct its business or cause us

to agree to unfavorable terms to continue the affected fund.  Although we periodically engage in discussions with the limited

partners of our funds regarding a waiver of such provisions with respect to executives involved in geographically or product

focused funds whose departures have occurred or are anticipated, such waiver is not guaranteed, and our limited partners’

refusal to provide a waiver may have a material adverse effect on our business and financial results.

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If we cannot retain and motivate our employees and other key personnel or recruit, retain and motivate new employees

and other key personnel, our business may be materially and adversely affected.  Our ability to recruit, retain and motivate

our employees and other key personnel is dependent on our ability to offer highly attractive incentive opportunities, benefits,

and compensation, which frequently includes allocating a portion of the carried interest that we earn from our investment

vehicles, which we refer to as the carry pool.  There can be no assurance that the carry pool will have sufficient cash available

to continue to make cash payments in the future, and fluctuations from the distributions generated from the carry pool could

render the compensation that KKR separately pays to them to be less attractive.  In order to retain and motivate our

employees and other key personnel, we may be required to pay them a higher amount of non-carry cash compensation to

retain and motivate them.  The loss, or ineffectiveness of any incentive compensation plans, including as a result of any

adverse changes in regulation or tax law that impacts certain forms of incentives or other remuneration that we may typically

offer employees, such as carried interest, may cause us to incur additional expenses to pay competitively with other firms,

which could materially and adversely affect KKR.  In addition, legal and regulatory developments outside of our control may

impact our ability to successfully identify, hire, and promote employees and other key personnel and may necessitate changes

to employment compensation practices.

We seek to retain our employees by having them agree to a confidentiality and restrictive covenants agreement.

However, there is no guarantee that the confidentiality and restrictive covenant agreements to which they are subject,

together with our other arrangements with them, will prevent them from leaving us, joining our competitors or otherwise

competing with us.  Depending on which entity is a party to these agreements and the laws applicable to them, we may not

be able to, or may choose not to, enforce them or become subject to lawsuits or other claims, and certain of these

agreements might be waived, modified or amended at any time without our consent.  Many countries and states within the

U.S. in which we operate have proposed, considered, or have already adopted, laws and rules which significantly limit or ban

noncompete clauses between employers and their employees, which could both limit our ability to enter into such restrictive

covenants and our ability to enforce them.  Even where enforceable, these agreements expire after a certain period of time,

at which point our former employees will be free to compete against us.

From time to time, our firm, our investment vehicles, our portfolio companies and other investments, or our employees

may be a focus of public attention or media coverage, and these circumstances, as well as broader social and political

tensions, may increase the risk of harassment, threats, acts of violence or other personal safety and security incidents

directed at our personnel, including our senior executives, both inside and outside the workplace. We have implemented, and

expect to continue to, implement or expand security measures for our senior executives and other key employees, such as

physical security, secure transportation, travel restrictions and monitoring or protective services for them and, in some cases,

their families. Such measures can be costly and may not be effective in preventing all incidents. Any actual or threatened

harm to the personal safety of our employees, or perceived failure to protect them adequately, could materially adversely

affect us, including our ability to attract and retain talent.

Our business could also be damaged by the misconduct of, or allegations of misconduct of, our employees or other key

personnel.  Misconduct by our employees or other key personnel could impair our ability to retain and recruit employees, to

attract and retain clients and investors, and may subject us to significant legal liability, regulatory scrutiny, and reputational

harm.

Our reliance on third parties in the operation of our business exposes us to operational, reputational

and other risks.

We rely significantly on third parties whom we do not control for significant support and assistance with various aspects

of our business, including for investment activities, accounting, record keeping, data processing, and other operations.  These

third parties include technology service providers, financial intermediaries and advisers, law firms, accountants,

administrators, lenders, broker dealers, distribution agents, consultants, and other vendors.  We generally have less control

over the delivery of third-party services and, as a result, may face disruptions to our ability to operate our business as a result

of interruptions of such services.  We may also be held liable if those third-party service providers, their employees or their

own third-party service providers are found to have committed negligence, violated laws or engaged in misconduct.  For

example, in the past, Global Atlantic was the subject of policyholder and agent class action litigation matters and a number of

regulatory matters stemming from service disruptions caused by a third-party administrator for certain Global Atlantic life

insurance policies. While Global Atlantic outsources policyholder administration to third-party, it is responsible under

insurance regulations and insurance contracts for servicing.

We rely heavily on the systems of third parties who provide technology services to us, including as part of our

information technology infrastructure.  Our data processing systems, communication lines and networks are often supported

by third-party service providers, vendors, and intermediaries.  A disaster, disruption, error or inability to operate or provide

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any of these services by us or our vendors or third parties with whom we conduct business could have a material adverse

impact on our financial results and our ability to continue to operate our business without interruption. Our business

continuation or disaster recovery programs may not be sufficient to mitigate the harm that may result from such a disaster or

disruption. In addition, insurance and other safeguards might only partially reimburse us for our losses, if at all. While we have

endeavored to mitigate the risk of other disruptions in the future, there can be no guarantee these mitigation efforts will be

successful. We may experience material reputational impacts and heightened regulatory scrutiny as a result of these matters.

Any interruption or failure of our information technology infrastructure caused directly or indirectly by third-party service

providers could result in our inability to provide services to our clients, other disruptions of our business, corruption or

modifications to our data and fraudulent transfers or requests for transfers of money or the inability to demonstrate

compliance with regulatory requirements.  Our third-party service providers could experience, and have experienced, certain

cyber incidents, and as a result, unauthorized individuals have gained access to our clients’, and could improperly gain access

to our, confidential data through such third parties.  Any cybersecurity incidents involving these third parties could impair the

quality of our operations and could impact our reputation and materially and adversely affect us.  We may also have

insufficient recourse against such third parties and may have to expend significant resources to mitigate the impact of such an

event, and to develop and implement protections to prevent future events of this nature from occurring. Actions taken by our

third-party service providers may also damage our reputation.  We consider our reputation critical to attracting and retaining

investors, maintaining our relationships with regulators and being viewed as an attractive investment partner.  As a result, any

negative publicity or negative public perception regarding a third-party service provider’s actions on our behalf may damage

our relationships with existing and potential investors, employees, regulators and other stakeholders, impair our ability to

raise capital, adversely impact the ability of our investment vehicles to make and exit investments, and impair our ability to

carry out investment activities generally.

We also specifically depend on the services of various financial intermediaries (including banks, prime brokers,

custodians, paying agents and escrow agents), counterparties, administrators and other agents, including to carry out certain

credit, securities, derivatives and hedging transactions, subjecting us to the risk that one or more of these counterparties

defaults, either voluntarily or involuntarily, on its performance under the applicable contract.  We may enter into financial

arrangements with a limited number of counterparties, which has the effect of concentrating the transaction volume (and

related counterparty default risk) with these counterparties.  If such a counterparty defaults, particularly a default by a major

investment bank or a default by a counterparty that has a significant number of our contracts, we may be materially adversely

affected.  In the event of the insolvency of a financial intermediary that is holding our assets as collateral (to the extent not

adequately segregated) or that is required to make payments to us, we may not be able to recover equivalent assets or

payment in full as we will rank among the financial intermediary’s unsecured creditors.  In addition, the timing of the recovery

of such amounts and assets (including segregated collateral) may also be significantly delayed as part of the administration of

the bankruptcy estate of the financial intermediary.  In addition, our risk management processes may not accurately

anticipate the impact of market stress or counterparty financial condition, and as a result, we may not take sufficient action to

reduce effectively our risks to them.  The inability to recover assets or payments from financial intermediaries could have a

material adverse impact on us as well as the performance of our investment vehicles.  For more information about the risks of

using financial intermediaries to sell investment and insurance products, please see “—Risks Related to Regulatory Matters—

Distribution of financial products to individual investors subjects us to heightened regulatory, litigation, and reputational risks,

which may materially adversely affect our business”.

Disruptions in our technology infrastructure or the occurrence of other operational errors could

materially and adversely affect our business.

Our business depends on the effective execution of operational processes and the reliability of information technology

systems, both those we operate and those provided by third parties. We rely on technology systems, including computer

hardware, software systems, data processing systems, and other technology infrastructure that we own or that are provided

and maintained by third party service providers.  See also “—Risks Related to Our Business—Our reliance on third parties in

the operation of our business exposes us to operational, reputational and other risks.”  As our reliance on such technology

infrastructure has increased, so have the risks associated with system vulnerabilities, data loss, cybersecurity incidents,

processing failures and operational disruptions.  If we are unable to adapt our technology infrastructure to accommodate our

growth, business changes or regulatory compliance needs, or if the cost of maintaining such systems may increase materially

from its current level, it may have a material adverse effect on us.  We may need to continue to invest heavily in upgrades and

expansions to our information technology infrastructure to continue to support our business and to avoid disruption of our

operations, including our investment activities.  Moreover, the technology systems of third-party providers and technology

infrastructure that we own may contain vulnerabilities or experience disruptions, including those resulting in data loss, that

could materially and adversely impact our business. In addition, certain of our operational processes continue to involve our

employees engaging in manual processes, which are inherently subject to execution risk, including unintentional mistakes,

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processing errors or control failures, which could materially and adversely affect us. Manual processes may be particularly

susceptible to error during periods of high transaction volume, personnel changes, new technology system implementations

or other operational transitions. Although we maintain policies, procedures, and internal controls, and have implemented

technology infrastructure designed to mitigate these risks, such measures may not be effective in preventing or detecting

errors in a timely manner.  Failures in our operational processes could result in financial loss, regulatory scrutiny, reputational

harm, and other adverse consequences.

The failure to effectively manage our balance sheet could materially and adversely affect our financial

condition and results of operations.

We have made a strategic decision to have a larger balance sheet than most of our asset management competitors, and

consequently, the management of our balance sheet has a greater impact on our financial condition and results of operations.

We utilize our balance sheet to support our insurance subsidiaries’ business and capital needs, underwrite commitments in

our capital markets transactions, make capital commitments to our investment vehicles, and make acquisitions and other

strategic investments for our Strategic Holdings segment.

A significant portion of our balance sheet is dedicated to the ownership and operation of our insurance business, which is

a capital-intensive, long-duration business. Our insurance subsidiaries are subject to regulatory capital requirements and

rating agency capital expectations that require each entity to maintain significant levels of capital.  To support insurance

company capitalization, we may need to contribute additional capital to our insurance subsidiaries, or we may be restricted

from growing and expanding our insurance business. Our insurance obligations to policyholders are contractual, and, in

contrast to our investment products, we must pay these obligations regardless of the investment performance of the assets

backing these obligations. We make significant assumptions to calculate our expected future insurance payment obligations,

including with respect to factors such as policyholder behavior and market or economic conditions that are not in our control.

We hold significant assets on balance sheet to support these insurance obligations.  We are subject to the market impacts on

and investment performance of such assets as well as actual policyholder behavior differing from our assumptions. If we are

unsuccessful in our asset-liability management, we will suffer insurance operating losses as we will owe more on our

insurance obligations than we earn on such assets and may be required to hold additional capital. Our insurance balance

sheet requires active risk management and a failure to manage those risks may have a material and adverse effect on us.

We have used our balance sheet in our capital markets business to underwrite loans, securities or other financial

instruments, which we generally expect to syndicate to third parties.  We have also entered into arrangements with third

parties that reduce our risk associated with holding unsold securities when underwriting certain debt transactions, which

enables our capital markets business to underwrite a larger amount.  To the extent that we are unable to syndicate our

commitments to third parties or our risk reduction arrangements do not fully perform as anticipated, we may be required to

sell such investments at a significant loss or hold them indefinitely, which could impact the performance of such investments

and also impair our capital markets business’ ability to complete additional transactions, either of which could materially and

adversely affect us.

In addition to the investments held in our insurance subsidiaries, which are reported in our Insurance segment, our

balance sheet makes investments and holds strategic assets that are reported in our Asset Management and Strategic

Holdings segments.  We bear the full risk of these balance sheet investments.  However, our success in generating returns on

this capital, will depend, among other things, on the availability of suitable opportunities for our balance sheet, including for

Strategic Holdings, after giving priority in investment opportunities to our advisory clients, and on our ability to realize the

values that we expect to achieve from acquiring these.

Our balance sheet assets have also been a significant source of capital for new investment strategies and products for

investors.  For example, we may acquire investments using our balance sheet capital and warehouse these investments while

fundraising a particular investment vehicle.  We expect our balance sheet capital to be returned to us if such investment

vehicle has a successful fundraise.  However, if the fundraising is not successful, or if investment vehicle investors are not

willing to pay for these warehoused investments, then we may realize losses on those investments or become limited in our

ability to seed new businesses or support our existing businesses as effectively as contemplated.

We also have made and expect to continue to make significant capital investments in our current and future funds and

other investment vehicles.  Contributing capital to these investment vehicles is risky, and we may not realize any significant

profit from them, or we may even lose some or all of the principal amount of our investments.  In addition, we have

developed and completed several structured transactions in which our balance sheet provides subordinated or equity

financing and third-party investors provide senior or preferred equity financing to an investment vehicle that invests in our

investment vehicles and certain other investment assets.  We have also entered into similarly structured transactions where

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the cash flows of our balance sheet’s capital commitments to our investment vehicles have been effectively pledged as

collateral for such investment vehicles.  Because of the subordinated nature of KKR’s interests, we are at risk of losing all of

our interests in these transactions ahead of any third-party if the investments do not perform as expected.  For further

information about KKR’s unfunded commitments to its investment vehicles, including funding requirements to levered

investment vehicles and structured transactions, see also Note 24 “Commitments and Contingencies—Funding Commitments

and Others” in our financial statements.

See also “—Risks Related to our Insurance Activities” below.

The failure to manage, or the inability to access, adequate sources of liquidity could materially and

adversely affect KKR.

We require significant liquidity in order to support and grow our asset management and insurance businesses, conduct

our investment activities, meet our capital markets underwriting commitments, satisfy our policyholder obligations and

comply with regulatory requirements.  We also have debt securities outstanding and indebtedness outstanding under various

credit facilities.

Depending on market and economic conditions, we may not be able to refinance or renew our debt obligations, or find

alternate sources of financing (including issuing debt or equity capital) on attractive or commercially reasonable terms or at

all.  Furthermore, the incurrence of additional debt could result in downgrades of our existing corporate credit ratings, which

could limit the availability of future financing and increase our costs of borrowing.  If our liquidity requirements were to

exceed our available liquid assets, we could be forced to sell assets or seek to raise debt or equity capital on unfavorable

terms.  Moreover, the failure to comply with covenants contained in any of our debt agreements could trigger prepayment

obligations that could materially and adversely affect us by causing liquidity constraints.  Any default under these agreements

(including through defaults on other debt that may result in cross-defaults on these agreements), and any resulting

acceleration of the borrower’s outstanding indebtedness, could have a material adverse effect on us and could also cause a

cross-default under our corporate revolving credit facility, which, if not cured or waived, could have a material adverse effect

on us.  See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity Needs” for

further information regarding our liquidity needs and our capital commitments as of December 31, 2025, and Note 16 “Debt

Obligations” in our financial statements for further information regarding our senior notes, credit facilities and other

outstanding debt obligations.

In addition, we have indebtedness at various subsidiaries, including subsidiaries that hold our asset management,

insurance, and strategic holdings businesses, the terms of which impose limitations on operations and restrict the ability to

make distributions to its direct and indirect parent companies, including KKR Group Partnership L.P.  In addition, our

insurance subsidiaries and certain capital markets subsidiaries are also subject to regulatory restrictions that place restrictions

on their ability to make distributions to their parent companies.  These restrictions on distributions impose limitations on our

ability to manage liquidity needs for the KKR business.

Certain investment vehicles we manage have liquidity needs that are not entirely in our control.  For example, individual

investors in our K-Series vehicles have the right to redeem their interests in the K-Series for cash.  There is a risk that our

investment vehicles will lack adequate liquidity to satisfy any unexpected redemption requests, which may occur for a variety

of reasons, including increases in their investors’ liquidity needs, which tend to be more pronounced during periods of market

volatility and which may escalate in any period and be particularly pronounced for investment vehicles.  If we are unable to

meet these redemption requests, or if any such redemption requests trigger any caps or limits that legally permit such

vehicles to gate or not honor redemption requests, then we could suffer material reputational harm.

In addition, our insurance companies have various liquidity needs that may be difficult to predict.  Many of the insurance

products allow policyholders to withdraw their funds, also referred to as a surrender, under contractually-defined

circumstances.  We may be forced to sell investments at a loss in connection with these redemption or withdrawal requests,

which are not always predictable and often driven by market and economic conditions that are not in our control.  In addition,

our reinsurance business is subject to potentially significant liquidity requirements.  Our reinsurance agreements generally

require Global Atlantic to provide collateral in trust for the benefit of the reinsurance client (the cedant), limiting our insurer’s

access to such assets for liquidity use, and some agreements may require additional collateral to be posted under certain

circumstances.  Moreover, reinsurance agreements generally provide the reinsurance client with recapture rights upon the

occurrence of certain contractual triggering events.  The exercise of such rights could, if alternate sources of liquidity are

unavailable, require our insurance subsidiaries to dispose of assets on unfavorable terms, including as a result of truncating

expected holdings periods unexpectedly. In addition, our U.S. insurance subsidiaries are members of  regional Federal Home

Loan Banks (“FHLB”), which allows those insurance subsidiaries to borrow from the FHLB using certain investments as

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collateral. Access to FHLB loans is an important source of liquidity for our insurance business.  If those sources of borrowing

were no longer available, the liquidity of our U.S. insurance subsidiaries could be materially and adversely affected. See “Risks

Related to our Insurance Activities.”

We have also used, and from time to time may continue to use, our balance sheet to provide credit support for our

general partners’ obligations to our investment vehicles, to facilitate certain investment transactions entered into by our

investment vehicles, and to make significant commitments to our investment vehicles.  See Note 24 “Commitments and

Contingencies” in our financial statements.

Our capital markets activities expose us to material risks.

We provide a broad range of capital markets services that include acting as an advisor or as an agent, principal,

underwriter, syndicator, arranger or other form of intermediary in connection with securities transactions, debt or equity

syndications, loan transactions, derivative transactions and other types of financings and financial arrangements.  However,

we may incur significant losses in connection with our capital markets activities, including to the extent that, for any reason

we are otherwise unable to dispose of any financial exposure that we incur at the prices that we anticipated or at all.  We also

may be subject to potential underwriter liability or regulatory consequences for material misstatements or omissions in

prospectuses or other offering documents relating to transactions in which we are involved.  We conduct capital markets

activities in connection with transactions in which our investment vehicles or insurance companies may participate as a

sponsor or as a purchaser or a seller of securities, which could constitute a conflict of interest or subject us to regulatory

scrutiny, liabilities or reputational harm. Please also see “—The failure to effectively manage our balance sheet could

materially and adversely affect our financial condition and results of operations.”

The failure to manage our financial and enterprise risks could materially and adversely affect our

financial condition and results of operation.

We seek to identify, monitor and manage certain financial and enterprise risks effectively.  If we are not able to

accurately or effectively price, identify and predict, manage or ameliorate these risks, or if our management of risk does not

accurately predict and appropriately respond to future risk exposures, such risks could have a material adverse effect on us.

We use derivative financial instruments and risk management strategies to hedge, manage or otherwise reduce investment

risks, they may not be properly implemented as designed, or otherwise not effectively offset the risks we have identified. We

may not have identified, or may not even be able to identify, all the material risks relevant for our asset management or

insurance businesses (including capital markets activities).  We also may choose not to hedge, in whole or in part, any of the

risks that have been identified.  In our insurance business, our hedging activities seek to mitigate economic impacts relating to

our insurance products and investments, which may result in additional volatility in financial results, adverse impacts on the

level of statutory capital and the risk-based capital ratios of our insurance subsidiaries, and may not effectively offset any

changes in insurance reserves.  In addition, the scope of risk management activities undertaken by us is selective and varies

based on the level and volatility of interest rates, prevailing foreign currency exchange rates, the types of investments that are

made and other changing market conditions.  We do not seek to hedge our exposure in all currencies or all investments or

insurance liabilities, which means that our exposure to certain market risks are not limited.  We also may use hedging

transactions and other derivative instruments to reduce the effects of a decline in the value of a position, but they do not

eliminate the possibility of fluctuations in the value of the position or prevent losses if the value of the position declines.

These kinds of transactions also generally limit the opportunity for gain if the value of a position increases. On the other hand,

our risk management actions with respect to insurance products with guaranteed benefits may be insufficient for Global

Atlantic to be protected against losses.  Unanticipated market changes may result in poorer overall investment performance

than if the hedging or other derivative transaction had not been executed. Moreover, it may not be possible to limit the

exposure to a market development that is so generally anticipated that a hedging or other derivative transaction cannot be

entered into at an acceptable price.

For a discussion of the market risks affecting our business and the strategies employed to mitigate them, including our

hedge program, please see “Item 7A.  Quantitative and Qualitative Disclosures About Market Risk.”

We may suffer material harm as a result of legal claims, litigations, investigations, and negative

publicity.

The activities of our businesses, including the investment decisions we make and the activities of our employees, may

subject us and our employees, officers and directors to the risk of litigation by third parties, as well as various governmental

and regulatory examinations, inquiries, investigations, and enforcement actions.  For a description of certain legal matters

involving KKR, see Note 24 “Commitments and Contingencies” in our financial statements.

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We, our investment vehicles, and our employees are each exposed to the risks of litigation relating to our asset

management and insurance businesses.  We are also exposed to risks of litigation, investigation or negative publicity in the

event any transactions we undertake are alleged not to have been properly considered and approved under applicable law.

An adverse judgment, order or decree could have a material adverse impact on our ability to conduct our business if it were

to constitute a disqualifying event under the laws and regulations applicable to our firm and could result in material

reputational damage that could adversely affect our ability to successfully fundraise or source or engage in investment

transactions. See also “—Risks Related to Regulation” below.

Although investors in our funds do not have legal remedies against us, the general partners of our funds, our funds, our

employees or our affiliates solely based on their dissatisfaction with the investment performance of those funds, such

investors may have remedies against us, the general partners of our funds, our funds, our employees or our affiliates to the

extent any losses result from fraud, gross negligence, willful misconduct or other similar misconduct.  While the general

partners and investment advisers to our investment funds, including their directors, officers, employees and affiliates, are

generally indemnified to the fullest extent permitted by law with respect to their conduct in connection with the management

of the business and affairs of our investment funds, such indemnity generally does not extend to actions determined to have

involved fraud, gross negligence, willful misconduct or other similar misconduct.  If any civil or criminal lawsuits brought

against us or the aforementioned entities or individuals results in a finding of substantial legal liability or culpability, the

lawsuit could materially and adversely affect us.  Similarly, allegations of improper conduct by private litigants or by

governmental or regulatory authorities, whether the ultimate outcome is favorable or unfavorable to us, as well as negative

publicity and press speculation about us, our investment activities or the private equity industry in general, whether or not

valid, may harm our reputation and cause volatility and speculation in the trading of our common stock. We consider our

reputation critical to attracting and retaining investors, maintaining our relationships with regulators and being viewed as an

attractive investment partner.  As a result, any negative publicity or negative public perception regarding our actions,

business, management or industry may damage our relationships with existing and potential investors, employees, regulators

and other stakeholders, impair our ability to raise capital, adversely impact the ability of our investment vehicles to make and

exit investments, and impair our ability to carry out investment activities generally.

See also “—The actions of our portfolio companies may subject us to potential liabilities and cause us reputational harm”

below.

We may pursue new business opportunities, strategic initiatives, or investment opportunities that

involve new or unique business, regulatory or other complexities and risks.

Our organizational documents do not limit our ability to enter into new lines of business, and we may expand into new

investment strategies, geographic markets, businesses, types of investors and investment products.  We seek to grow our

businesses by, among other things, increasing AUM in existing businesses, pursuing new investment strategies (including

investment opportunities in new asset classes), developing new types of investment structures and products (such as publicly

listed vehicles, separately managed accounts and structured products), expanding into new geographic markets and

businesses and seeking investments from investor bases we have traditionally not pursued, such as individual investors, which

subject us to additional risk.  Introducing new types of investment structures and products could increase the complexities

and conflicts of interest involved in managing such investments, including ensuring compliance with applicable regulatory

requirements and terms of the investment vehicles. There is no assurance that all areas of our business will achieve a

satisfactory level of scale and profitability.

In the first quarter of 2024, we implemented strategic initiatives that included creating our Strategic Holdings business

segment. We continue to believe that we will receive more stable recurring revenues in the future from the growth over time

in dividend payments and earnings from companies included in our Strategic Holdings segment.  However, this is our current

expectation and not a guarantee that they will be realized or be as accretive to our earnings as we currently expect.  For

example, expectations about dividend amounts and investment returns from companies in our Strategic Holdings segment in

the future and the future growth of such companies, may be materially less than our current expectations or may not

materialize at all, and assumptions, including those relating to free cash flow, future capital structures of such companies,

future capital investments by us in such companies, future market and economic conditions, including interest rates, and

other assumptions, may differ materially from actual outcomes.

In 2025, we announced changes to the management of our insurance business to originate longer-duration liabilities and

assets, including investing more into non-yielding or lower-yield assets classes like private equity and real assets, expanding

outside the United States, and raising more third-party co-investment insurance capital.  We believe these changes will

expand Global Atlantic’s competitive advantage and enable the generation of higher and more durable returns over the long

term; however, our financial results could be adversely impacted in the near- and medium- term as we rotate into longer-

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duration liabilities and assets.  While it is our current expectation that this strategic initiative will be successful over the long

term, it is not guaranteed that these results will be realized or that these changes will be as accretive to our earnings as we

currently expect, and these changes may result in losses. Additionally, these strategic initiatives may add new business and

regulatory complexities.

In February 2026, we announced an agreement to acquire Arctos Partners, an investment management firm that invests

in professional sports teams and that provides strategic capital to other asset management firms.  The acquisition is subject to

the satisfaction or waiver of certain regulatory and specified sports league approvals and other closing conditions. As part of

our proposed acquisition of Arctos, we have applied for approvals by certain sports leagues as indirect owners of sports

teams. Following the closing of the Arctos acquisition, we and our investment vehicles and portfolio companies must comply

with the league rules applicable to owners. These league rules prohibit or restrict certain investments — for example control

investments in gambling businesses or relationships with professional athletes. Complying with these rules may restrict

investment opportunities that our investment vehicles, portfolio companies, or we may have otherwise pursued, raising

potential conflicts of interest. See “—If we fail to effectively manage conflicts of interest that arise from our investment

activities, our reputation, business or financial results could be materially and adversely impacted or we may become subject

to regulatory scrutiny or litigation.” Failure to manage our compliance with these league rules could result in a material

adverse impact to our business, financial condition and results of operations.

To the extent we have made, or make, strategic investments or acquisitions or undertake other strategic initiatives,

expand into new investment strategies or geographic markets, or enter into a new line of business, we will face numerous

risks and uncertainties, including risks associated with:

• the required investment of capital and other resources;

• delays or failure to complete an acquisition or other transaction in a timely manner or at all, which may subject us to

damages or require us to pay significant costs;

• lawsuits challenging an acquisition or unfavorable judgments in such lawsuits, which may prevent the closing of the

transaction, cause delays, or require us to incur substantial costs including in costs associated with the

indemnification of directors;

• the failure to realize the anticipated benefits from an acquired business or strategic partnership in a timely manner, if

at all;

• combining, integrating or developing operational and management systems and controls, including an acquired

business’ internal controls and procedures;

• acquiring an investment that is subject to significant liabilities, including contingent liabilities, which could be

unknown to us or inadequately insured at the time of acquisition;

• integration of the businesses, including the employees of an acquired business;

• disagreements with joint venture partners or other stakeholders in our hedge fund partnerships and our strategic

partnerships;

• the additional business risks of the acquired business and the broadening of our geographic footprint;

• properly managing conflicts of interests;

• complex tax structuring that could be challenged or disregarded, which may result in losing treaty benefits or would

otherwise adversely impact our investments;

• our ability to obtain requisite regulatory approvals and licenses without undue cost or delay and without being

required to comply with material restrictions or material conditions that would be detrimental to us or to the

combined organization;

• incurrence of indemnification obligations or other contingent liabilities;

• increased regulatory scrutiny and our ability to comply with new regulatory regimes; and

• becoming subject to new laws and regulations with which we are not familiar, or from which we are currently

exempt, that may lead to increased litigation and regulatory risk and costs.

We may not realize the expected benefits of such new investments, acquisitions or initiatives.

We operate in a highly competitive industry.

Our asset management business competes with other investment managers for both investors for our investment

vehicles and for investment opportunities, including for our Strategic Holdings segment. We believe that competition for

investors for our investment vehicles is based primarily on investment performance, investor liquidity and willingness to

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invest, investor perception of investment managers' drive, focus and alignment of interest, business reputation, duration of

relationships, quality of services, pricing, fund terms including fees, and the relative attractiveness of the types of investments

that have been or are to be made. We believe that competition for investment opportunities is based primarily on the pricing,

terms, and structure of a proposed investment and certainty of execution. The firm's competitors consist primarily of

alternative and traditional asset manager sponsors of public and private investment vehicles, investment and commercial

banks (including activities conducted by their broker-dealers and investment advisers), commercial finance companies,

sovereign wealth funds, real estate development companies, BDCs, and strategic buyers. In addition, we also face competition

from local and regional investment firms, financial institutions, and other competitors in the various countries in which we

invest, where local firms may have more established relationships with the companies in which we are attempting to invest.

There are numerous funds focused on private equity, real assets, credit, and hedge fund strategies that compete for

investor capital. Fund managers have also increasingly adopted investment strategies outside of their traditional focus. For

example, traditional asset management firms have acquired alternative asset management firms, and hedge funds focused on

credit and equity strategies have taken control positions in companies, while private equity funds have acquired minority

equity or debt positions in publicly listed companies. This convergence heightens competition for investments. Furthermore,

as institutional fund investors increasingly consolidate their relationships for multiple investment products with a few

investment firms, competition for capital from such institutional fund investors have become more acute. We also face

extensive competition from both traditional and alternative asset management firms in connection with our business

initiatives to increase the number and types of investment products and fundraise directly and indirectly from individual

investors, including accredited investors and mass affluent individuals.  We may be unable to achieve as quickly as expected,

or at all, our strategic business initiatives to increase the number and types of investment products and vehicles we offer

directly or indirectly to these types of investors as there is extensive competition for such investors and in private wealth

management by our competitors.

Some of our competitors may have greater financial, technical, marketing and other resources, and more personnel than

us.  In the case of some asset classes and certain investment products, including those offered to individual investors, our

competitors may, and sometimes do, have longer operating histories, more established relationships, or greater experience.

Several of our competitors have raised, or may raise, significant amounts of capital and have investment objectives that are

similar to the investment objectives of our investment vehicles, which may create additional competition for investment

opportunities. Some of these competitors may also have lower costs of capital and access to funding sources that are not

available to us, which may create competitive advantages for them. In addition, some of these competitors may have higher

risk tolerances, different risk assessments or lower return thresholds, which could allow them to consider a wider range of

investments and to bid more aggressively than us for investments. Strategic buyers may also be able to achieve synergistic

cost savings or revenue enhancements with respect to a targeted portfolio company, which typically provide them with a

competitive advantage in bidding for such investments. Some of our competitors may have agreed to terms on their

investment funds or products that are more favorable to investors than our funds or products and therefore we may be

forced to match or otherwise revise our terms to be less favorable to us than they have been in the past and, further, some of

our competitors may be willing to pay higher placement fees in order to gain distribution of their private wealth products. We

may lose investment opportunities in the future if we do not match investment prices, structures and terms offered by

competitors.  Alternatively, we may experience decreased investment returns and increased risks of loss if we match

investment prices, structures and terms offered by competitors.

Our capital markets business competes primarily with investment banks and broker-dealers in North America, Europe,

Asia-Pacific, and the Middle East. We principally focus our capital markets activities on our funds and our portfolio companies,

but we also seek to service other third parties. While we generally target customers with whom we have existing

relationships, those customers may have similar relationships with the firm's competitors, many of whom will have access to

competing securities transactions, greater financial, technical or marketing resources, or more established reputations than

Our insurance business also operates in highly competitive markets. Please see “—Risks Related to Our Insurance

Activities—We operate in a highly competitive industry”.

Additionally, some of our competitors may be subject to less regulation or less regulatory scrutiny and accordingly may

have more flexibility to undertake and execute certain businesses or investments than we do or bear less expense to comply

with such regulations than we do.

Parts of our earnings and cash flow are highly variable due to the nature of our business.

Parts of our earnings are highly variable from quarter to quarter due to volatility of investment valuations, the investment

returns by our funds and other investment vehicles, and the accrual and payment of carried interest and fees earned from our

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investment activities.  We recognize earnings on investments in our investment vehicles based on our allocable share of

realized and unrealized gains (or losses) reported by such investment vehicles and for certain of our recent investment

vehicles when a performance hurdle is achieved, which in each case is subject to significant uncertainty and risk.  During times

of market volatility, the fair value of the investments we own or manage are more variable, and volatility in the equity

markets may have a significant impact on our reported results.  A decline in realized or unrealized gains, a failure to achieve a

performance hurdle, or an increase in realized or unrealized losses, would adversely affect our financial results.

The timing and receipt of carried interest from our investment vehicles are unpredictable and will contribute to the

volatility of our cash flows.  With respect to our carry paying funds, subject to the terms of their respective governing

agreements, carried interest is generally eligible to be distributed to the general partner of the fund with a clawback provision

only after meeting certain conditions tied to performance.  See “Item 1.  Business—Business Segments—Asset Management

— Investment Vehicle Structures, Fee Arrangements and Carried Interest” for a summary of such conditions.  Even after all

conditions are met, the general partner of a carry paying fund may decide to defer the distribution of carried interest to it to a

later date.  Carried interest payments depend on our investment vehicles’ performance and opportunities for realizing gains,

which may be limited.  It typically takes a substantial period of time to: (i) identify attractive investment opportunities, (ii)

raise all the funds needed to make an investment, and (iii) then to realize the cash value of an investment through a sale,

public offering or other exit to generate carried interest proceeds.  To the extent an investment is not profitable, no carried

interest will be received from our investment vehicles with respect to that investment and, to the extent such investment

remains unprofitable, we will only be entitled to a management fee on that investment.  We cannot predict when, or if, any

realization of investments will occur.  See “Management’s Discussion and Analysis of Financial Condition and Results of

Operations—Liquidity—Sources of Liquidity” for further information regarding the conditions for carried interest to become

distributable.

The timing and receipt of carried interest also vary with the life cycle of certain of our investment vehicles.  For our carry-

paying investment vehicles that have completed their investment periods and are able to realize mature investments,

sometimes referred to as being in a harvesting period, we are more likely to receive larger carried interest distributions than

our carry-paying investment vehicles that are in their fundraising or investment periods.

Fee income, which we recognize when contractually earned, can vary due to fluctuations in AUM, the number of

investment transactions made by our investment vehicles, when such investments are made, the number of portfolio

companies we manage, the fee provisions contained in our investment vehicles and other investment products and

transactions by our capital markets business.  In any particular quarter, fee income may vary significantly due to the variances

in size and frequency of transaction fees or fees received by our capital markets business.

Additionally, a decline in the pace, size, or value of investments by our investment vehicles would result in our receiving

less revenue from fees.  The transaction, management, and monitoring fees that we earn are driven in part by the pace at

which our investment vehicles make investments and the size of those investments.  Any decline in that pace or the size of

investments would reduce our revenue from transaction and management or monitoring fees.  Likewise, during an attractive

selling environment, our investment vehicles may capitalize on increased opportunities to exit investments.  While this would

generally be expected to increase the timing and receipt of carried interest, any increase in the pace at which our investment

vehicles exit investments, if not offset by new commitments and investments, could reduce future management fees.

Additionally, in certain of our investment vehicles that derive management fees only on the basis of invested capital, the pace

at which we make investments, the length of time we hold such investments, and the timing of disposition will impact our

revenues.

With respect to our insurance business, we have and may experience fluctuations in the new business volumes, and

resulting financial result impacts, of certain products, such as block reinsurance, pension risk transfer and funding

agreements.  In addition, aspects of how our insurance business is required to report certain investments and liabilities has

added, and is expected to add, volatility to our financial results from quarter to quarter.

The agreements governing our carry-paying funds have in the past and may in the future give rise to a

contingent obligation that requires us to return or contribute significant cash amounts to our funds

and fund investors.

We have in the past and may in the future be required to return carried interest that we have received from investment

funds.  The partnership documents governing our carry-paying funds across our asset classes include what are often called

“clawback” provisions.  Under such an obligation, upon the liquidation of a fund or other event as set forth in the terms

governing the fund, the general partner is required to return, typically on an after-tax basis, previously distributed carry to the

extent that, due to the diminished performance of later investments, the aggregate amount of carry distributions received by

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the general partner during the term of the fund exceed the amount to which the general partner was ultimately entitled, after

taking into account the effects of any performance thresholds and hurdles.  We would continue to be subject to such

obligation even if carry has been distributed to current or former employees through our carry pool.  If such current or former

employees do not satisfy their share of any clawback obligation, we will be responsible for funding the entire obligation and

may need to seek other sources of liquidity to fund such an obligation.  To the extent one or more obligations were to occur

for any one or more of our carry-paying funds, we might not have available cash to satisfy such obligation once it is realized,

putting us in breach of the fund’s governing agreements and potentially resulting in a material adverse impact on our ability

to raise additional or successor funds in the future.  Even when there is sufficient available cash to satisfy any such obligation,

the realization of any such obligation may materially adversely impact our business and financial results, including by reducing

our realized performance income and realized investment income. See “Management's Discussion and Analysis of Financial

Condition and Results of Operations—Liquidity—Sources of Liquidity” for a discussion of carried interest repayment

obligations, including information about realized carried interest repayment in the fourth quarter 2025 relating to our Asian

Fund II.

The inability to raise capital from third-party investors for our investment vehicles, insurance business

and transactions could materially and adversely affect us.

We raise third party capital for our investment vehicles and insurance business, and we also raise capital for specific

transactions that we may sponsor or that are sponsored by third parties. The failure to continually raise adequate capital

could materially and adversely affect our AUM, revenues, liquidity and overall financial results.

Investment performance is one of the most significant factors in our ability to raise capital. Poor investment performance

for any reason, whether due to market conditions, valuations, pace of realizations, or other factors, including relative to

portfolio benchmarks, fee levels, or our competitors’ performance, may also materially adversely affect our ability to

fundraise. Certain investment vehicles, particularly those that provide investors with redemption rights, may require us to

maintain higher levels of liquidity, which may affect portfolio construction and could impact investment performance.

Our ability to raise capital is also dependent on market and economic conditions and investor perception, including the

general appeal of alternative asset investments or our financial products. Our ability to raise capital depends on numerous

factors, many of which are beyond our control, including economic conditions, financial market volatility, regulatory

developments, investor liquidity and competitive dynamics. Investors in our investment or insurance products may decide to

redeem their capital, or decide to seek financial products other than ours for any number of reasons, such as competitors’

terms or offerings, changes in interest rates that make other financial products more attractive, changes in investor

perception regarding our focus or alignment of interest, reputational concerns, how we manage conflicts of interest, changes

in investors’ views of portfolio construction or asset allocation, concerns about valuations, ability to meet redemption

requests, liquidity, or departures or changes in key personnel.

In connection with raising new investment vehicles or securing additional investments in existing vehicles, we may

negotiate terms for such vehicles that are materially less favorable to us than prior terms or terms of investment vehicles

advised by our competitors.  Such terms may include reduced management fees, fee holidays, increased co-investment rights

or other economic or governance concessions, which could materially and adversely affect us in a number of ways, including

by reducing the fee revenues we earn.  Competitive pressures and evolving investor expectations may require us to agree to

such unfavorable terms in order to attract or retain capital.

The number of investment vehicles for which we raise capital varies from year to year.  Our flagship funds and other

funds have a finite life and a finite amount of commitments from fund investors.  Once a fund nears the end of its investment

period, our ability to continue making investments and generating fees and carry depends on our ability to raise additional or

successor funds. Although our funds may continue to earn management fees after the expiration of their investment periods,

such fees are generally at a reduced rate.  There is no assurance we would be able to raise successor funds of comparable

size, within similar timeframes, or on comparable terms.  If we are unable to do so, or if fundraising is delayed, our revenues

may decrease as predecessor funds mature and associated fees decrease.

The ability to raise capital from institutional investors is critical and may be adversely affected by

factors beyond our control.

Institutional investors are significant investors in our investment funds and the investments syndicated by our capital

markets business.  Institutional investors that experience decreasing returns, liquidity pressures, increased volatility, funding

shortfalls or difficulty maintaining target asset allocations may materially decrease or temporarily suspend making new

investments in our investment funds or with alternate asset managers generally.  Such concerns could be exhibited, in

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particular, by public pension funds, which have historically been among the largest investors in alternative assets.  Pension

funds have had and in the future may have funding problems that will likely be exacerbated by economic downturns.

Concerns with liquidity could cause such public pension funds or other institutional investors to reevaluate the

appropriateness of alternative assets. Reduced distributions from alternative asset investments or declines in other asset

classes may cause investors to exceed target allocations to alternative assets, limiting their ability to make new commitments.

In addition, certain institutional investors, including sovereign wealth funds and public pension funds, continue to

demonstrate an increased preference for alternatives to traditional fund structures, such as separately managed accounts or

specialized investment vehicles and, in some cases, consolidating their capital with fewer alternative asset managers.  In order

to try to satisfy the evolving preferences of investors, we have sponsored, and will continue, to sponsor a wide array of

separately managed accounts and investor allocations to these separately managed accounts or specialized investment

vehicles may detract from the allocations potentially available to our funds or other traditional investment vehicles, which

may result in less profitability for us.  There can be no assurance that historical or current levels of commitments to our funds

or other traditional investment vehicles from these investors will continue.

Moreover, certain institutional investors are demonstrating a preference to hire their own investment professionals and

to make direct investments in alternative assets without the assistance of large institutional investment advisers like us.  Such

institutional investors may become our competitors and could cease to be our clients.  Institutional investors may also decide

not to invest with large asset managers like us, for example, because of conflicts of interest arising from the size and

complexity of our business, including the allocation of investment opportunities among different funds and vehicles, including

those offered to individual investors. Given the breadth and complexity of our platform, including the management of

multiple funds, insurance assets and vehicles offered to individual investors, conflicts of interest may arise in the allocation of

investment opportunities, management attention or other resources.  Any perception that we do not appropriately manage

such conflicts could adversely affect our relationships with institutional investors and our ability to raise capital from them.

For additional information about conflicts of interest that may impact our ability to raise capital, please see “—Risks Related

to Our Investment Activities—If we fail to effectively manage conflicts of interest that arise from our investment activities, our

reputation, business or financial results could be materially and adversely impacted or we may become subject to regulatory

scrutiny or litigation”.  All of these factors could result in a smaller overall pool of available capital in our industry or a smaller

pool of institutional capital for our investment vehicles.

In addition, the asset allocation rules or investment policies to which institutional investors are subject could inhibit or

restrict their ability to make investments in our investment funds.  This risk may be heightened at times of poor performance

in other asset classes or even strong performance in the asset classes we manage, as investors may need to rebalance their

portfolios to remain in compliance with these rules and policies.  Coupled with any lack of distributions from their existing

investment portfolios, many of these investors may have disproportionately outsized remaining commitments to, and

invested capital in, a number of investment funds, which may significantly limit their ability to make new commitments to the

investment funds we manage, which could materially and adversely affect our financial performance.

The sale of financial products to individual investors exposes us to additional operational complexities,

regulatory requirements and other risks.

We have expanded and may continue to expand the number and types of financial products we offer to individual

investors.  Offering financial products, whether investment opportunities in alternative asset strategies or insurance policies

like annuities, to individual investors exposes us to heightened levels of risks.  Products offered to individual investors may be

subject to different and, in some cases, more extensive disclosure, marketing, distribution and investor protection

requirements than traditional institutional investment funds.  In addition, the distribution of investment products to

individual investors may involve additional intermediaries, platforms or distribution channels and may subject us to evolving

regulatory standards regarding marketing practices, suitability determinations, fee disclosures, valuation methodologies and

redemption features. As a result, these initiatives may increase our exposure to public and regulatory scrutiny, consumer

complaints, private litigation, compliance costs and reputational harm. For additional information about the regulatory risks

relating to individual investors, please see “—Risks Related to Regulatory Matters—Distribution of financial products to

individual investors subjects us to heightened regulatory, litigation, and reputational risks, which may materially adversely

affect our business” and “—Risks Related to our Insurance Activities—The disruption of our third-party distribution network

may have a material adverse effect on us.”

Certain investment vehicles that we manage are publicly traded, which involves heightened risk of litigation, and

additional disclosure and governance obligations. In addition, certain of these and other investment vehicles are registered

under the Investment Company Act as investment companies.  These funds and their investment advisers are subject to

extensive regulation, which, among other things, regulate the relationship between a registered investment company and its

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investment adviser and prohibit or severely restrict principal transactions and joint transactions.  In addition, we have one or

more affiliates that provide investment advisory services to BDCs, which are also subject to certain restrictions and

prohibitions under the Investment Company Act.  If the entity fails to meet applicable regulatory requirements, it may be

regulated as a closed-end investment company under the Investment Company Act and become subject to different

regulatory restrictions, which could limit its operating flexibility and in turn result in decreased profitability for us.

We have also launched U.S. holding company conglomerates, which together with similar non-U.S. investment vehicles

we refer to as K-Series, which are structured and operated in reliance on exclusions from the definition of an investment

company under the Investment Company Act.  If any such entity were required to register as an investment company, the

applicable restrictions on capital structure, leverage, transactions with affiliates, governance, and operations would make it

impractical for the entity to operate its business as currently conducted and could materially and adversely affect our financial

results and results of operations.  For additional information about certain regulatory risks relating to regulatory exemptions,

please see “—Risks Related to Regulatory Matters— If regulatory exemptions or exclusions on which we rely become

unavailable, we may become subject to additional restrictive and costly regulatory requirements, regulatory action or

liability”.

As we have offered more investment products to individual investors, the operational demands necessary to support

these types of investor products and the related business and operational complexity has also significantly increased.

Insurance products are subject to regulations regarding statements, required disclosures and claims handling and accordingly

require significant operational capabilities. Managing vehicles that offer periodic redemption features or are marketed to

individual investors may require more frequent valuations, additional investor communications, enhanced liquidity

management, more compliance and technology requirements, and more third-party service support. For example, our K-

Series vehicles and certain funds that provide for redemptions to individual investors require that we perform monthly or

daily valuations of net asset value and manage liquidity to satisfy potential redemption requests. For additional information

about valuation risks, please see “—The valuations of illiquid investments are subjective and uncertain, and any realizations of

our illiquid investments may occur at prices which differ from their carrying values” and for more information about liquidity

risks, please see “—The failure to manage, or the inability to access, adequate sources of liquidity could materially and

adversely affect KKR”.  If we fail to effectively manage these risks, we could be subject to regulatory action, litigation,

reputational harm, or constraints on our ability to grow these products, any of which could materially and adversely affect our

business.

Even if our investment performance or product terms remain attractive, adverse market conditions or shifts in public

opinion relating to products that we offer could adversely affect our ability to expand or maintain these product offerings.

For example, products offered to individual investors may be more sensitive to negative publicity, whether it is caused by the

level of fees, the existence or improper management conflicts of interests, inability to satisfy redemption requests, service

challenges or others changes in investor sentiment.  Negative publicity may also be caused by the activities of third-party

sponsors or insurers that are unaffiliated with us, which nevertheless could cause significant redemptions or surrenders,

result in reduced demand for our products, or cause us to reduce our economics to maintain investor interest in the products

we offer to individual investors.

The portion of our AUM we refer to as perpetual capital is not permanent and is subject to change.

We refer to a significant portion of our AUM as perpetual capital, because this AUM has an indefinite term with no

predetermined requirement to return invested capital to investors upon the realization of investments.  This AUM includes

the capital of our evergreen products, which include investment vehicles registered under the Investment Company Act,

certain unregistered investment vehicles like our K-Series offered to individual investors, and listed companies like KREF and

Crescent Energy, as well as the capital of our insurance companies.  However, in addition to fluctuations based on the

valuations of the underlying investments of the AUM, this capital is subject to material reduction, including through

withdrawals, redemptions, periodic payments such as dividends or required distributions, and termination of investment

advisory agreements, and these reductions may occur with minimal notice.

Our insurance companies have issued annuities and other life insurance policies that require certain contractual

payments to the policyholder. These policies may permit the policyholder to withdraw their funds or to surrender their policy

for distribution in advance of the policy term. In addition, our insurance companies have entered into reinsurance agreements

with counterparties, which provide for contractually provided payments, including to cover reinsured policyholder

obligations. Unless the inflows from writing new insurance policies and entering into new reinsurance transactions exceeds

outflows to pay contractual obligations, or the valuation of the assets backing our insurance liabilities increases in excess of

any expected appreciation, our permanent capital from our insurance subsidiaries and sponsored insurers would be reduced.

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See also “—The failure to manage, or the inability to access, adequate sources of liquidity could materially and adversely

affect KKR.”

Certain of our registered and unregistered investment vehicles, including our K-Series, permit their investors to redeem

their investments, which would have the effect of reducing our AUM.  Substantial redemption requests could be triggered by

a number of events outside of our control, including poor investment performance, changes in market conditions or changes

in their perception of us as a reputable investment manager.  A perception of significant redemptions, both with respect to

the investment vehicles we manage as well as investment vehicles that we do not manage but are in similar asset classes, may

also trigger other investors to seek redemptions of their investments as well.  See also “—The failure to manage, or the

inability to access, adequate sources of liquidity could materially and adversely affect KKR.”

We have investment management agreements with certain registered and unregistered investment vehicles and listed

companies that we manage as well as with our insurance companies.  Perpetual capital from these entities may be removed

completely from our AUM, because our investment management agreement with them may be terminated on little or no

notice for reasons specified in such agreement, including due to poor investment performance or regulatory compliance.  See

“—Risks Related to Regulatory Matters.”  In the case of any such terminations, the management and incentive fees we earn in

connection with managing such entities would immediately cease, which could result in a material adverse impact on our

revenues.

The actions of our portfolio companies may subject us to potential liabilities and cause us reputational

harm.

We often make controlling investments in companies or hold investments over which we have significant influence over

their management or operations. Although these portfolio companies operate their businesses independently from KKR’s own

businesses and independently from one another, our ownership interests, governance rights or involvement with these

portfolio companies may cause us to be deemed a control person or otherwise subject to theories of successor, aiding-and-

abetting or similar liability under applicable law.  Alternative asset managers have in the past been held liable for acts of their

portfolio companies where the manager is alleged to have exercised control or to have authorized, or knowingly failed to

prevent or remediate, impr oper conduct, including with respect to the U.S. Foreign Corrupt Practices Act (the “FCPA”),

European antitrust laws, and financial crime laws.  See “—Risks Related to Regulatory Matters—We are subject to substantial

regulatory risks due to our extensive and global investment activities.”

As a result, we may have liability for actions taken by, or failures to take action by, our portfolio companies, which may

subject us to civil or criminal liabilities.  Any such liabilities could require our investment vehicles to pay substantial financial

sums, which may not be fully reimbursed for by the relevant portfolio company or covered by insurance.  Any criminal

liabilities or other enforcement actions taken by regulators in response to actions or failures to act by our portfolio companies

could also involve our investment vehicles, our subsidiaries that operate such investment vehicles as its general partners or

manager, and our personnel involved with such portfolio company’s business.

In addition, activities by our portfolio companies and other companies in which we invest may be imputed to us. We

believe our reputation is critical to our business, including for attracting and retaining investors, maintaining relationships

with regulators and being viewed as an attractive investment partner. Any legal or regulatory action involving our portfolio

companies, including any settlement, or any negative publicity or adverse public perception regarding a portfolio company’s

actions, business, management or industry, may result in significant reputational harm to us, increased regulatory scrutiny

and additional regulatory exposure or litigation. In addition, we may elect to pay certain amounts or agree to other

consequences, including operational restrictions, to resolve matters involving any of our portfolio companies or investments

in order to mitigate potential reputational, regulatory, or other damage to our business. These developments could damage

our relationships with existing and prospective investors, employees, regulators and other stakeholders, and otherwise could

result in a material and adverse effect on KKR’s business or financial condition.

Changes in tax laws or an adverse interpretation by tax authorities may adversely impact our effective

tax rate and tax liability.

Our effective tax rate and tax liability is based on the application of current income tax laws, regulations and treaties,

which are complex and may be open to interpretation.  Significant management judgment is required in determining our

provision for income taxes, our deferred tax assets and liabilities and any valuation allowance recorded against our net

deferred tax assets.  Although we believe our application of current laws, regulations and treaties to be correct and

sustainable upon examination by tax authorities, tax authorities could challenge our interpretation resulting in additional tax

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liability or adjustment to financial results that could increase our effective tax rate or have other unforeseen adverse tax

consequences.

There could be significant changes in U.S. federal, state, local or non-U.S. tax law that may materially affect us, including

by increasing taxes owed in jurisdictions in which we or our portfolio companies operate.  The likelihood and nature of any

such legislation is uncertain. For example, on July 4, 2025, the legislation commonly referred to as the One Big Beautiful Bill

Act (“OBBBA”), was enacted, which included amendments and extensions to certain provisions of the 2017 Tax Cuts and Jobs

Act.  The impact of the OBBBA and other potential changes are uncertain and could materially increase the amount of taxes

we and our portfolio companies are required to pay and tax-related regulatory and compliance costs.  In addition, further

rules relating to compensation for certain covered employees under Section 162(m) could reduce the amount of related tax

deductions available to us.

There could be significant changes in U.S. and non-U.S. tax law, regulations or interpretations that adversely affect the

taxation of carried interest and our ability to recruit, retain and motivate employees and key personnel.  Investments must be

held for more than three years for carried interest to be treated for U.S. federal income tax purposes as long-term capital

gain.  The holding period requirement may result in some of our carried interest being taxed as ordinary income to our U.S.

employees and other key personnel, which could materially increase the amount of taxes that they would be required to pay,

and this could adversely impact our ability to recruit and retain top talent.  The incentive to hold investments for long-term

capital gain treatment may create a conflict of interest between investment vehicle investors (whose investments would

receive such capital gain treatment after a holding period of only one year) and KKR on the execution, closing or timing of

sales of investments in connection with the receipt of carried interest.

The Organization for Economic Co-operation and Development (an intergovernmental public policy organization, the

“OECD”) and government agencies in jurisdictions in which we and our affiliates invest or do business have maintained a focus

on multi-national companies. The OECD has sought to make changes to numerous long-standing tax principles through its

base erosion and profit shifting (“BEPS”) project, which is focused on a number of issues, including profit shifting among

affiliated entities in different jurisdictions, interest deductibility and eligibility for the benefits of double tax treaties.  The

OECD finalized guidelines that recommend certain multinational enterprises to be subject to a minimum 15% tax rate (“Pillar

Two”).

Various countries have implemented or intend to implement the OECD’s recommended model rules.  By way of example,

the Council of the European Union formally adopted Pillar Two and required all 27 EU member states to adopt local legislation

during 2023 to implement Pillar Two rules that apply in respect of the fiscal years beginning from December 31, 2023.

However, the current U.S. administration is not expected to adopt Pillar Two and has been working with the OECD to exempt

U.S. parented groups from certain aspects of Pillar Two, such as the Income Inclusion Rule (the “IRR”) and Undertaxed Profits

Rule (the “UTPR”), creating additional uncertainty as to the application of these rules to multinational enterprises with a U.S.

parent entity.  Our business and our sponsored vehicles’ and portfolio companies’ businesses could be significantly impacted

if the model rules, or any future variation, have been or will be implemented in any of the countries in which our business, our

portfolio companies’ businesses, or our investment structures are located.  Bermuda’s commitment to the OECD principles

has led it to adopt a corporate income tax that may increase tax expense and compliance costs for us.  More generally, our

effective tax rates could increase, including by way of a possible denial of deductions or profits being allocated differently.

The OECD’s proposals may also lead to an increase in the complexity, burden and cost of tax compliance for us and our

portfolio companies.  Given ongoing design, implementation, administration, and interpretation of such proposals, the timing,

scope, and impact of any relevant domestic legislation or multilateral conventions remain subject to significant uncertainty.

See Note 18 “Income Taxes” in our financial statements for further information regarding various tax matters.

Artificial intelligence may increase competitive, operational, legal and regulatory risks to our

businesses in ways that we cannot predict.

The use of artificial intelligence by us and others, and the overall adoption of artificial intelligence throughout the world,

may exacerbate or create new and unpredictable competitive, operational, legal and regulatory risks to our businesses.  Any

changes from the use of artificial intelligence could potentially disrupt, among other things, our business models, investment

strategies, investment performance, operational processes, and our ability to identify and hire employees.  Some of our

competitors may be more successful than us in the development and implementation of new technologies to address investor

demands, making investments or improve operations, including services and platforms based on artificial intelligence.

We use artificial intelligence and other quantitative analysis tools and models, developed by us and third-party service

providers. Such technology, analysis and modeling are highly complex and subject to limitations and risks that have the

potential to adversely impact us to the extent that we rely on artificial intelligence. If the data we, or third parties whose

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services we rely on, use in connection with the development or deployment of artificial intelligence is incomplete, inadequate

or biased in some way, the performance of our products, services, and businesses could suffer. Data in technology that uses

artificial intelligence may contain a degree of inaccuracy and error, which could result in flawed algorithms in various models

used in our businesses. Our personnel or the personnel of our service providers could, without our knowledge, improperly

utilize or misappropriate artificial intelligence and machine-learning technology while carrying out their responsibilities,

including relating to the entry of confidential information into a technology platform that is or becomes accessible by third

parties. The misuse or misappropriation of our data, unavoidable deficiencies in the practices associated with data collection,

training artificial intelligence technology on large data sets, and big data analytics and difficulties validating data, could have

an adverse impact on us.

Regulators are also increasing scrutiny and considering, and in some cases enacting, regulation of the use of artificial

intelligence technologies, including regarding the use of big data, diligence of data sets and oversight of data vendors.  The

use of artificial intelligence by us or others may require compliance with legal or regulatory frameworks that are not fully

developed or tested, and we may face increased costs, litigation and regulatory actions related to our use of artificial

intelligence. See also “—Risks Related to Regulatory Matters—Privacy, data protection, cybersecurity and artificial intelligence

laws may increase compliance costs and subject us to enforcement risks and reputational risks”.

In addition, artificial intelligence may materially disrupt the industries in which we invest, the businesses of our portfolio

companies and the valuations of our investments.  See also “—Risks Related to Our Investment Activities—Various conditions

and events outside of our control that are difficult to quantify or predict may have a significant impact on the valuation of our

investments”.

Cybersecurity failures and data security breaches could have a material adverse impact on our

businesses.

We are subject to various risks and costs associated with the collection, processing, storage and transmission of

proprietary, sensitive and otherwise confidential information, including personal information of our investors, insurance

policyholders, employees, contractors and other counterparties and third parties, to which we have access to and process

through a variety of media, including information technology systems.  Breaches in security could potentially jeopardize our,

our employees’, our investment vehicle investors’, our insurance policyholders’ or our counterparties’ confidential and other

information processed and stored in, and transmitted through, our computer systems and networks.  Any inability, or

perceived inability, by us to adequately address privacy concerns, or comply with applicable privacy laws, regulations, policies,

industry standards and guidance, related contractual obligations, or other privacy legal obligations, even if unfounded, could

result in significant regulatory and third-party liability, increased costs, disruption of our business and operations, and a loss of

investor confidence and other reputational damage.

We continuously face various security threats on a regular basis, including ongoing cybersecurity threats to, and attacks

on, our information technology infrastructure that are intended to gain access to our confidential information, destroy data or

disable, degrade or sabotage our systems.  The risk of a security breach or disruption has increased as the number, intensity,

and sophistication of attempted attacks and intrusions from around the world have increased.  Although we take protective

measures and endeavor to modify them as circumstances warrant, our computer systems, software and networks may be

vulnerable to unauthorized access, theft, misuse, computer viruses or other malicious code, and other events that could have

a security impact (including the deployment of harmful malware, ransomware, denial-of-service attacks, social engineering,

and other means to affect service reliability and threaten the confidentiality, integrity, and availability of information).  Our

employees have been and expect to continue to be the target of fraudulent calls and emails, and the subject of

impersonations and fraudulent requests for money, which we or the services providers we retain, like administrators, paying

agents and escrow agents, may not be able to detect or protect against.  These same cybersecurity breaches, cyberattack and

cyber intrusions could also be employed against our various stakeholders or other third parties, including attempts to

impersonate KKR or its employees, which could cause similar security impacts to our stakeholders, including our portfolio

companies, and other third parties and materially and adversely impact us.  The costs related to cyber or other security

threats or disruptions may not be fully insured or indemnified by others, including by our service providers.

Our cybersecurity risk management efforts and our investment in information technology may not be successful in

preventing cyber incidents, which could have a material adverse effect upon our reputation, business, operations, or financial

condition.  The techniques used by cyber criminals change frequently, may not be recognized until launched, and can

originate from a wide variety of sources.    Furthermore, if we experience a cybersecurity incident and fail to comply with the

relevant notification laws and regulations, it could result in regulatory investigations and penalties, which could lead to

negative publicity and may cause our investors and clients to lose confidence in the effectiveness of our security measures.

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See also “—Our reliance on third parties in the operation of our business exposes us to operational, reputational and

other risks”.

We are subject to focus by certain stakeholders on sustainability matters.

Some investors in our investment vehicles, stockholders, regulators and other stakeholders are focused on sustainability

matters, such as climate change and environmental stewardship, human rights, support for local communities, corporate

governance and transparency, or other environmental- or social-related areas.  Certain investors and other stakeholder

groups have also increased their activism and scrutiny of asset managers’ approaches to considering sustainability matters as

part of their investment management decision-making, including by urging alternative asset managers to take (or refrain from

taking) certain actions that could adversely impact the value of an investment and at times have conditioned future capital

commitments on such actions.  Further, a number of U.S. states and non-U.S. countries have enacted or proposed policies,

legislation, issued related legal opinions and engaged in related litigation regarding sustainability matters.  Increased focus

and activism related to sustainability matters may constrain our capital deployment opportunities.  There can be no assurance

that we will be able to accomplish any sustainability-related goals or commitments that we have announced or may announce

in the future, as such statements are, or reflect, estimates, aspirations or expectations only at the time of announcement.

More broadly, there can be no assurance that our responsible investment policies and procedures will not change, potentially

materially, or may not be applicable for a particular investment, because we continuously review our approach to these

issues. Growing interest on the part of investors and regulators in sustainability matters and increased demand for, and

scrutiny of, asset managers’ sustainability-related disclosure, have also increased the risk that asset managers could be

perceived as, or accused of, making inaccurate or misleading statements regarding these matters.  The occurrence of any of

the foregoing could have a material and adverse impact on us, including on our reputation.

Although we view our sustainable investing approach as a tool for value creation and value protection, different

stakeholder groups and regulators across the jurisdictions and localities where we operate have divergent views on the merits

of integrating sustainability considerations into the investment process and have, as applicable, increasingly expressed

divergent views and investment expectations with respect to sustainability initiatives and, as applicable, pursued divergent

regulatory initiatives.  The increased regulatory and legal complexity and heightened risk of public scrutiny could result in

conflicting sustainability-related regulations and legal frameworks that increase our compliance costs and our risk of non-

compliance or impact our reputation and lead to increased inquiries, investigations, challenges by federal or state authorities,

and reactive stakeholder engagements.  Moreover, if our practices do not meet evolving stakeholders’ expectations and

standards, or if we are unable to satisfy all stakeholders, our reputation, ability to attract or retain employees and our

business could be negatively impacted.

Risks Related to Regulatory Matters

We are required to comply with numerous laws and regulations applicable to our business in various countries around

the world.  Our compliance with these laws and regulations is critical to our ability to operate our business, and the potential

failure to comply subjects us to many material risks and uncertainties as discussed below.  For information about the laws and

regulations applicable to our business, please also see “Business—Regulation”.  For additional regulatory risks related to

Global Atlantic, please also see “—Risks Related to Our Insurance Activities—Our insurance business is heavily regulated, and

such regulations may have a material and adverse effect on our business, financial condition and results of operations.”

Our business is subject to complex, extensive and evolving laws, and the failure to comply with

applicable laws may materially and adversely affect us.

We are a global financial institution, and our business is subject to complex, extensive and evolving laws and regulations

in the jurisdictions in which we operate around the world.  Our asset management and capital markets businesses are

generally governed by securities laws and regulations applicable to investment advisers, broker-dealers, and other financial

services firms, including extensive regulatory requirements relating to registration, fiduciary obligations, disclosure, reporting,

recordkeeping, supervision and compliance.  In addition, our insurance business is subject to complex laws and extensive

regulations applicable to insurance companies as well as regulations applicable to investment advisers, broker-dealers, and

other financial services firms, including requirements relating to licensing, capital adequacy, investments, governance, policy

terms, reporting and compliance. Our compliance with these securities and insurance laws and regulations and the other laws

and regulations applicable to our business (which may evolve and change, from time to time) is critical to our ability to

operate our business and is costly, operationally intensive, and requires significant management attention.  Any failure to

comply with these laws or regulations, or any changes in the scope, interpretation, application, or enforcement of such laws

and regulations, could materially and adversely affect our business, results of operations, and financial condition.

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Adverse regulatory actions may result in significant sanctions, liabilities, operational restrictions,

litigation, reputational harm and other material and adverse impacts to our business.

Our compliance with securities and insurance laws and regulations, as well as other laws and regulations applicable to

our business, is subject to frequent examinations, inquiries and investigations by U.S. federal and state, as well as non-U.S.,

governmental agencies and regulatory authorities (including self-regulatory organizations) in the jurisdictions in which we

operate. Governmental agencies and regulatory authorities (including self-regulatory organizations) often have broad

discretion to interpret and apply the laws and regulations applicable to our industry and our business and to determine areas

of focus for their examinations, inquiries, and investigations.  Moreover, many of these laws and regulations authorize such

entities to conduct enforcement actions and other proceedings that may result in civil or criminal liability, penalties, and fines;

or other sanctions, including censures, cease-and-desist orders, settlements or revocations, suspensions or expulsions of

applicable memberships, licenses, registrations, authorizations or other regulatory approvals that, in any of these cases, may

apply with respect to us or any one or more of our businesses, employees, investments or portfolio companies. In addition,

convictions, injunctions, sanctions or settlements imposed by a governmental authority could form the basis for automatic or

discretionary limitations on our memberships, licenses, registrations, authorizations or other regulatory approvals, or our

ability or the ability of our affiliates to rely on exemptions, that are administered by a different governmental authority.  Any

of these actions or consequences could materially and adversely affect us.

Any resolution of claims brought by a governmental agency or regulatory authority (including self-regulatory

organizations) may, in addition to the imposition of significant monetary penalties or other sanctions, require an admission of

wrongdoing or result in adverse limitations or prohibitions on our ability to conduct our business activities, including potential

statutory disqualifications, third-party oversight of various business processes, or the divestiture of investments.  Actions by a

governmental agency or regulatory authority in one area of our business could affect other areas of our business, including

our joint venture partners and portfolio companies, which could, in turn, materially and adversely affect our business, results

of operations and financial condition. Even if an investigation or proceeding does not result in a sanction or the sanction

imposed is not material in monetary terms, the investigation, proceeding, action, imposition of sanctions or general

perception of impropriety could still significantly harm our reputation, adversely impact our relationship with our regulators,

result in increased future regulatory scrutiny, result in the loss of investors and investment opportunities, and place us at a

material disadvantage to our competitors.

The suspension, revocation, or limitation of our regulatory registrations or licenses may materially

adversely affect our business.

As a regulated financial institution, we rely on our regulatory registrations and licenses around the world in order to

conduct our business.  The suspension, revocation, or limitation of our regulatory registrations or licenses may materially

adversely affect our business and potentially prohibit our ability to conduct our business at all.  For example, we operate

registered investment advisers and broker-dealers in the United States and around the world, and the suspension, revocation

or limitation of our registrations as an investment adviser or as a broker-dealer would limit or could even prohibit us from

conducting our asset management and capital markets businesses in the jurisdictions in which we currently operate.

A U.S. investment adviser’s registration under the Investment Advisers Act may be suspended, revoked, or otherwise

limited as a result of, among other things, failure to meet eligibility requirements for registration with the Securities and

Exchange Commission (“SEC”), violations of applicable federal securities laws or fiduciary duties, violations of criminal laws,

materially inaccurate or incomplete regulatory filings, or as the result of disciplinary or enforcement actions by the SEC or

other federal, state or non-U.S. regulators, including actions based on criminal convictions, guilty pleas, or injunctions

involving the adviser or its associated persons.  In particular, investment advisers are subject to heightened regulatory

scrutiny with respect to the identification, disclosure and management of conflicts of interest, including conflicts arising from

principal transactions, cross trades or other transactions in which the adviser or its affiliates have a financial or other interest.

See “—Risks Related to Our Business—We may pursue new business opportunities, strategic initiatives, or investment

opportunities that involve new or unique business, regulatory or other complexities and risks” and “—Risks Related to Our

Investment Activities—If we fail to effectively manage conflicts of interest that arise from our investment activities, our

reputation, business or financial results could be materially and adversely impacted or we may become subject to regulatory

scrutiny or litigation”.

A U.S. broker-dealer’s registration under the Securities Exchange Act of 1934 may be suspended, revoked, or otherwise

limited as a result of, among other things, violations of federal securities laws or regulations, failure to comply with the rules

and regulations of the SEC and the Financial Industry Regulatory Authority (“FINRA”), materially inaccurate or incomplete

regulatory filings, failure to maintain required net capital or supervisory systems, insolvency, criminal convictions or

injunctions involving the broker-dealer or its associated persons, or as the result of disciplinary or enforcement actions by the

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SEC, FINRA or other federal, state or non-U.S. regulators, including actions based on the conduct of affiliates or associated

persons.  Similarly, the Investment Company Act may disqualify certain persons and their affiliates from acting in various

capacities for U.S. registered funds, including as investment adviser, as a result of certain convictions and injunctions.

We also rely on similar registrations in order to conduct our asset management business outside of the United States .

For example, in Europe, we are an AIFM registered with the Central Bank of Ireland under the AIFMD, and in the United

Kingdom, we are regulated by the FCA under the FSMA.  In addition, in Asia, we are a financial instruments business operator

under the Financial Instruments and Exchange Act of Japan and a licensed asset manager and broker-dealer with the

Securities and Futures Commission in Hong Kong, and we conduct fund management activities under license from the

Monetary Authority of Singapore. For more information, see “Business—Regulation”.

In addition, an insurance company’s license or authorization may be suspended, revoked, or otherwise limited as a result

of, among other things, failure to meet applicable solvency, capital, or reserve requirements; deficiencies in risk management,

internal controls, or governance; violations of applicable insurance laws or regulations; inaccurate or incomplete regulatory

filings or disclosures; unsafe or unsound business practices; failures in market conduct or consumer protection compliance; or

as a result of regulatory examinations, supervisory actions, or enforcement proceedings.  Insurance regulators have broad

authority to impose corrective actions, restrictions, enhanced oversight, or other regulatory measures, including in

connection with capital adequacy, investment practices, governance, reporting, or market conduct matters, and adverse

regulatory actions affecting our insurance subsidiaries could limit their ability to write new business, require changes to

investment or operating practices, restrict dividend capacity or intercompany arrangements, or otherwise materially

adversely affect our insurance business and the results of our operations.  See, generally, “—Risks Related to Our Insurance

Activities”.

Any suspension, revocation, limitation, conditioning, or failure to obtain or renew licenses, registrations, authorizations,

exemptions, or approvals applicable to any of our businesses, in the United States or in any other country in which we

operate around the world, could restrict or prohibit our ability to conduct our business, require restructuring of business lines,

limit products we offer, impede fundraising, restrict transaction activity, or otherwise materially adversely affect our business.

See also “—Adverse regulatory actions may result in significant sanctions, liabilities, operational restrictions, litigation,

reputational harm and other material and adverse impacts to our business”.

Changes in the regulatory framework applicable to our business, including the loss of exemptions or

the application of enhanced group-level regulation, may materially adversely affect us.

Our business operates within regulatory frameworks globally that distinguish among different types of financial activities,

products, organizational structure, and other factors. These regulatory frameworks, including the scope, availability, and

interpretation of exemptions, exclusions, and tailored regulatory requirements, are subject to change. If the regulatory

framework applicable to our business were to change, we could become subject to additional or more comprehensive

regulation in any one or more jurisdictions in which we operate, which may cause material and adverse impacts to our

business. The regulatory framework applicable to our business may change for a number of reasons, including through

amendments to existing laws or regulations; changes in regulatory interpretation or supervisory expectations; changes in

enforcement priorities or activity; evolving regulatory views regarding, among other things, market structure, investor

protection, or financial stability; changes in how our business activities or organizational structure are viewed by regulators;

disqualifying events involving us, our affiliates, or associated persons; or changes in our business activities or organizational

structure or the growth or expansion of our business, including our expansion into new geographies, offering new investment

or insurance products, or changing the way we raise capital from investors.

In particular, regulatory frameworks applicable to our business may evolve over time.  For example, our private credit

strategies and insurance-adjacent lending activities operate largely outside the traditional banking system and are subject to a

complex and developing set of regulatory regimes, including securities, insurance, derivatives, banking, and financial stability

laws. Although these activities are conducted through entities that are not regulated as banks, they have increasingly

attracted regulatory attention due to their scale, growth, use of leverage, liquidity characteristics, interconnectedness with

regulated financial institutions and potential relevance to broader financial markets. Regulatory authorities may adopt new or

revised laws, regulations, guidance, or supervisory approaches applicable to these activities. Such developments could include

heightened reporting or disclosure requirements, limitations on leverage, increased liquidity requirements, restrictions on

investment strategies or asset concentrations, or enhanced governance or risk-management expectations. In addition,

regulatory initiatives relating to non-bank financial intermediation or so-called “shadow banking,” as well as financial-stability-

oriented regulation, could result in the recharacterization of certain of our private credit or insurance-adjacent activities or

the imposition of activity-based or group-level regulatory requirements that have historically applied to banks or other

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systemically important financial institutions, which could materially adversely affect our business, financial condition, and

results of operations.

Moreover, given the scale and scope of our business and financial activities, regulators may evaluate our business and

risk profile on a consolidated or group-wide basis rather than solely by reference to individual regulated entities. In the United

States, the Financial Stability Oversight Council has authority to designate certain non-bank financial companies as

systemically important financial institutions, which could subject a designated entity to enhanced supervision and regulation.

Similarly, in the European Union and the United Kingdom, groups that engage in both insurance and investment activities may

be subject to supplementary group-wide supervision under the Financial Conglomerates Directive and its UK equivalent. If we

were to become subject to such enhanced or group-level regulatory regimes, we could face materially increased regulatory

burdens, governance, reporting, capital, liquidity, or risk-management requirements, restrictions on business activities or

intercompany arrangements, or other limitations that could materially adversely affect our business, financial condition, and

results of operations.

For matters that may specifically affect our insurance business, please see “—Risks Related to Our Insurance Activities—

Our insurance business is heavily regulated, and such regulations may have a material and adverse effect on our business,

financial condition and results of operations.”

If regulatory exemptions or exclusions on which we rely become unavailable, we may become subject

to additional restrictive and costly regulatory requirements, regulatory action or liability.

We regularly rely on exemptions, exclusions and other regulatory accommodations under U.S. and non-U.S. laws and

regulations in conducting our asset management, capital markets and insurance businesses.  The unavailability of these

exemptions or exclusions for any reason, including changes in law, changes in regulatory interpretation, disqualifying events

involving us, our affiliates, or associated persons, or changes in our business activities or organizational structure, may subject

us or our investment vehicles to additional restrictive and costly regulatory compliance requirements, regulatory action or

third-party claims, or other otherwise materially and adversely affect our business.

In particular, we rely on exemptions from requirements pursuant to the Securities Act of 1933, the Securities Exchange

Act of 1934, the Investment Company Act, the Commodity Exchange Act of 1936, and the Employee Retirement Income

Security Act of 1974 (“ERISA”) in conducting our business activities, as well as exemptions from various foreign regulatory

requirements.  These exemptions are often highly complex, subject to evolving interpretation, and may in certain

circumstances depend on compliance by third parties or factual determinations that may be outside of our control.

For example, in raising new funds or other investment vehicles in the United States, we typically rely on private

placement exemptions from registration under the Securities Act, including Rule 506 of Regulation D.  If we, our investment

vehicles or any of the covered persons associated with our investment vehicles were to become subject to a disqualifying

event, which includes a variety of criminal, regulatory and civil matters, one or more of our investment vehicles could lose the

ability to raise capital in a Rule 506 private offering, which could materially impair our ability to raise capital for existing and

new investment vehicles.  The occurrence of a disqualifying event would also materially and adversely affect our ability to

raise or syndicate capital for our transactions and for third parties and otherwise materially and adversely affect our ability to

conduct our capital markets business, which depends on our ability to participate in unregistered securities offerings.  As we

expand the array of vehicles that we offer to individual investors, we may increasingly rely on the Rule 506(c) safe harbor,

which permits general solicitation and advertising but requires enhanced procedures to verify accredited investor status,

increasing compliance complexity and execution risks. Outside of the United States, we also rely on similar private placement

exemptions and marketing registrations, for example under the AIFMD in Europe, the Financial Services and Markets Act 2000

(as amended and supplemented by statutory instruments) and the Alternative Investment Fund Managers Regulations 2013

(as amended) in the United Kingdom, the Financial Instruments and Exchange Act in Japan, and the Securities and Futures Act

in Singapore.

In addition, certain of our investment vehicles, including our K-Series vehicles, are structured and operated in reliance on

exclusions from the definition of an investment company under the Investment Company Act.  If any such entity were

required to register as an investment company, the applicable restrictions on capital structure, leverage, transactions with

affiliates, governance, and operations would make it impractical for the entity to operate its business as currently conducted

and could materially and adversely affect our financial results and results of operations.

In the United States, the CFTC and the SEC regulate transactions in futures and swaps as well as entities that enter into

those transactions.  We are also subject to similar regulations when we trade derivatives in non-U.S. jurisdictions. These

regulations may limit our trading activities and our ability to implement effective hedging strategies or increase the costs of

compliance.  We generally operate our businesses pursuant to exemptions from registration, but certain transactions in

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futures, swaps and other derivatives remain subject to regulatory requirements regardless of our registration status.  We and

other asset management firms rely on an exemption from aggregation for portfolio companies that hold positions in the

relevant contracts.  Our insurance subsidiaries must also comply with applicable insurance and other regulations with respect

to hedging.  Any changes in application or interpretation of the rules applicable to futures, swaps and other derivatives could

result in significant costs for us and our investment vehicles.

Distribution of financial products to individual investors subjects us to heightened regulatory,

litigation, and reputational risks, which may materially adversely affect our business.

As part of our growth strategy, we have distributed and expect to continue distributing certain of our investment and

insurance products to individual investors.  In some cases, our financial products are distributed indirectly through third-party

managed vehicles sponsored by brokerage firms, banks, or third-party feeder providers, and in other cases directly to the

clients of banks, independent investment advisers, and broker-dealers. We also create investment products specifically

designed for direct investment by individual investors in the United States and in non-U.S. jurisdictions. Products offered to

individual investors are subject to heightened regulatory scrutiny, prescriptive conduct standards, and increased litigation risk

compared to products offered primarily to institutional investors.

For example, in the United States, the public offering and sale of securities to individual investors is subject to the anti-

fraud and other investor protection provisions of the Securities Act of 1933, the Securities Exchange Act of 1934, and, where

applicable, the Investment Company Act, which may subject issuers and their affiliates and control persons to heightened

regulatory scrutiny and to claims by private plaintiffs alleging that such products were inappropriately marketed, inadequately

disclosed, or otherwise offered or sold in violation of applicable securities laws. We have sponsored and advise, or sub-advise,

investment products whose structuring and investments in illiquid assets are novel and untested. In addition, U.S. broker-

dealers and their associated persons are subject to laws and regulations governing the sale of financial products to individual

investors, including Regulation Best Interest, which requires recommendations to retail customers to be made in the

customer’s best interest. These regulations also apply to third-party broker-dealers and any broker-dealers we operate that

distribute our investment or insurance products directly to individual investors. Compliance with such regulations and related

disclosure requirements, conflict-management, supervision, and recordkeeping requirements may impose additional costs,

operational complexity, and supervisory obligations on us, and may impact our ability to distribute our financial products to

individual investors. See also “—Risks Related to Our Insurance Activities—Our insurance business is heavily regulated, and

such regulations may have a material and adverse effect on our business, financial condition and results of operations.”

In addition, various non-U.S. laws and regulations also govern the sale of financial products to individual investors,

including, for example, Directive 2014/65/EU (MiFID II), Directive 2011/61/EU (AIFMD), and Regulation 2015/760/EU (ELTIF

Regulation) which govern the sale of financial products to individual investors in the European Economic Area (the “EEA”).

These EEA directives and regulations contain requirements for, among other things, marketing, investor suitability

assessments, and conflicts of interest management, and certain of these requirements also apply to distributors, placement

agents and other intermediaries that distribute our products to individual investors.  Moreover, although the EEA’s directives

and regulations are intended to create an EEA-wide harmonized framework, individual EEA member states may supplement

them with their own national rules, which adds to complexity and compliance risks.

The distribution of our products to individual investors often occurs through third-party channels that we do not control.

Although we conduct due diligence and establish onboarding and contractual arrangements with such distributors, we may

not be able to effectively monitor or control how our products are marketed, recommended, or sold. As a result, we may be

exposed to regulatory inquiries, enforcement actions, litigation, or reputational harm arising from allegations that our

products were sold to investors for whom they were unsuitable or inadequately disclosed, even where such conduct was

undertaken by third parties. Similar risks arise if our employees involved in distribution or oversight of third-party distributors

fail to adhere to applicable compliance or supervisory requirements.  Legislative and regulatory developments may affect our

retail strategy. In the United States, initiatives intended to expand access by participants in 401(k) and other defined

contribution plans to alternative investments may create new opportunities but also raise complex regulatory, fiduciary,

disclosure, valuation, liquidity, and operational issues under securities and other applicable laws. We may incur significant

costs to design and implement products and compliance frameworks to access such channels, and those costs may not be

recoverable if regulatory requirements change, are delayed, or do not take effect. At the same time, competitors may pursue

these opportunities more aggressively, potentially placing us at a competitive disadvantage.  Expanding our focus on

individual investors may also subject us to increased scrutiny regarding fees, liquidity, valuation, marketing, and disclosures,

increase the risk of private litigation or regulatory enforcement, and could be perceived by our institutional investors as

creating conflicts of interest or a shift in strategic focus, any of which could materially adversely affect our business, results of

operations, and financial condition. See also “—Adverse regulatory actions may result in significant sanctions, liabilities,

operational restrictions, litigation, reputational harm and other material and adverse impacts to our business.”

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Regulations impacting the insurance industry and insurance companies owned by alternative asset

managers may adversely affect our business.

The NAIC and task forces and working groups appointed by it as well as individual U.S. state insurance regulators continue

to consider various initiatives to change and modernize the solvency framework applicable to regulated insurance companies.

These initiatives include enhancing the ability of state insurance regulators to effectively monitor the solvency and risks faced

by an insurer within a larger group and when engaging in reinsurance transactions with other insurers.  Although initially the

NAIC’s actions were driven by growing concerns related to companies owned by alternative asset management firms, the

NAIC and individual state insurance regulators have shifted toward an activity-based regulatory approach, signaling continued

potential for additional regulation. The NAIC and state insurance regulators have adopted and continue to evaluate new

regulations relating to affiliates and investment structures (including revisions to the capital charges for asset-backed

securities, in particular CLOs), investment management agreements, governance standards, market conduct practices and use

of third-party administrators.  For example, the NAIC and U.S. state insurance regulators have increasingly focused on the

terms, structure, and negotiation of investment management agreements.

As part of their efforts to address potential risks stemming from an insurance company’s relationship with alternative

asset managers that may impact the insurance company’s risk profile, regulators have increased their scrutiny of certain

structured investments held by insurance companies, the appropriateness of investment ratings and potential conflicts of

interest (including affiliated investments), and potential misalignment of incentives.  This growing scrutiny may increase the

risk of regulatory actions against our insurance business and could result in new or amended regulations that limit our ability

as an investment adviser, or make it more burdensome or costly, to enter into or amend existing investment management

agreements with insurance companies and thereby grow our insurance strategy. Additionally, the group-wide supervisor for

our insurance business is the Indiana Department of Insurance.  The Indiana Department of Insurance has informed us that it

will be part of the International Association of Insurance Supervisors’ Global Monitoring Exercise, a risk assessment

framework to monitor key risks and trends and to detect the potential build-up of systemic risk in the global insurance sector

that also includes all Internationally Active Insurance Groups (“IAIGs”).  IAIGs are expected to be subject to group-wide capital

standards once adopted by the United States.  At this time, we cannot accurately predict whether we will be named or

designated as an IAIG or the impact, if any, on us.

See also “—Risks Related to Our Insurance Activities—Our insurance business is heavily regulated, and such regulations

may have a material and adverse effect on our business, financial condition and results of operations.”

We are subject to substantial regulatory risks due to our extensive and global investment activities.

As a global alternative asset manager, we regularly engage in transactions involving equity and debt investments,

mergers, acquisitions, financings, restructurings, exits, and other investment activities across numerous jurisdictions. These

transactions are subject to a wide range of complex laws and regulations, including securities, antitrust, foreign investment,

sanctions, export controls, anti-corruption, and other regulations administered by U.S. and non-U.S. governmental

authorities.

In addition to the laws and regulations arising from our investment activities, we also become subject from time to time

to the laws and regulations applicable to the businesses of our portfolio companies, including the regulations related to the

U.S. Federal Energy Regulatory Commission, the U.S. Federal Communications Commission, and the U.S. Defense

Counterintelligence and Security Agency as well as various laws and regulations of non-U.S. jurisdictions, such as those

promulgated by the U.K. Financial Conduct Authority, the Swedish Financial Supervisory Authority, the German Federal

Financial Supervisory Authority, and the Australian Prudential Regulation Authority. Compliance with these laws and

regulations is highly fact-specific, requires significant time, resources, and coordination across multiple jurisdictions, and is

subject to heightened regulatory scrutiny and enforcement.  Compliance with these laws and regulations is highly fact-

specific, requires significant time, resources, and coordination across multiple jurisdictions, and is subject to heightened

regulatory scrutiny and enforcement.

Our ability to comply with many of these requirements depends in part on obtaining timely, complete, and accurate

information from portfolio companies, management teams, counterparties, and third-party advisers, including information

relating to operations, ownership structures, counterparties, customers, and historical conduct. We may not always be able to

independently verify such information, and we rely significantly on our portfolio companies to provide such information to us.

In some cases, inaccurate, incomplete, or delayed information may not be identified until after a transaction has closed,

which could result in regulatory investigations, the reopening of prior approval processes, the imposition of remedial

measures or sanctions, or other adverse consequences for us and our portfolio companies. See also “—The actions of our

portfolio companies may subject us to potential liabilities and cause us reputational harm”.

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Compliance with these transactional regulatory requirements is costly and operationally complex, requiring substantial

investment in personnel, systems, controls, and external advisers. These costs may increase as regulatory regimes become

more expansive, enforcement activity intensifies, or new jurisdictions or asset classes are added to our investment activities.

Failure to comply, or errors in assessing or implementing compliance requirements in connection with our transactions, could

subject us or our portfolio companies to civil or criminal penalties, fines, sanctions, judgments, remedial obligations,

transaction delays or prohibitions, reputational harm, or other adverse consequences.  In certain circumstances, we or our

personnel could also be subject to civil or criminal investigations or enforcement actions based on the conduct of portfolio

companies, joint venture partners, counterparties, or other third parties, including under theories of control person,

successor, or aiding-and-abetting liability.  The failure to effectively manage these risks, or significant increases in compliance

burdens or enforcement exposure, could materially adversely affect our business, results of operations, financial condition,

and reputation.  See also “—Our business is subject to complex, extensive and evolving laws, and the failure to comply with

applicable laws may materially and adversely affect us” and “—Adverse regulatory actions may result in significant sanctions,

liabilities, operational restrictions, litigation, reputational harm and other material and adverse impacts to our business”.

Various investment-related and competition laws may limit our investment opportunities and subject

us to adverse regulatory consequences.

As a global alternative asset manager with a broad investment platform, our ability to identify, pursue, and consummate

attractive investment opportunities may be constrained by various investment-related and competition laws, including

antitrust, merger control, foreign direct investment (“FDI”) and similar laws and regulations that aim to control investment

activity in various jurisdictions around the world. These regimes may restrict the types of transactions we can pursue, the

industries or assets in which we can invest, the structures through which we can invest, or the investors that can participate in

them, particularly given our size, global footprint, and ownership of, or relationships with, a wide range of portfolio

companies and affiliates.

In many cases, the potential applicability of investment-related and competition laws may deter us from pursuing certain

investment opportunities, limit our ability to finance existing functions, or require us to structure transactions in ways that are

less attractive or less competitive, including by limiting ownership levels, governance rights, syndication arrangements, co-

investor participation, or exit alternatives. In addition, counterparties, sellers, financing sources, or co-investors may be

unwilling to engage in transactions subject to extended or uncertain regulatory review, or may prefer bidders with simpler

ownership structures or perceived lower regulatory risk, placing us at a competitive disadvantage.

Our transactions are often subject to investment-related and competition laws that require pre-closing or post-closing

notifications, approvals, or clearances in connection with our investment activities, including under U.S. antitrust laws and

national-security-focused regimes such as the U.S. Foreign Investment Risk Review Modernization Act, pursuant to which the

Committee on Foreign Investment in the United States may review, block, or impose conditions on investments by non-U.S.

persons in U.S. businesses or real assets. Many jurisdictions around the world have similar or comparable antitrust and FDI

regimes.  Additionally, certain jurisdictions may impose restrictions or prohibitions on businesses making investments in other

countries or otherwise restrict investment activities. For example, the U.S. Outbound Investment Security Program imposes

notification requirements and prohibitions for certain investments in entities engaged in specified technology sectors outside

of the United States. The prospect of review or restrictions under these regimes may narrow the universe of feasible

transactions, delay decision-making, or require significant resources to evaluate regulatory risk before we can determine

whether to pursue an opportunity. Determining which investment-related and competition laws and regulations apply to any

particular transaction, identifying the applicable filing, notice, approval, or other requirements that may be triggered under

such laws and regulations, and ensuring compliance with all applicable requirements can be complex and resource-intensive.

Any of the foregoing could reduce the number or attractiveness of investment opportunities available to us, increase the

time, cost, and complexity associated with evaluating and executing transactions, limit our ability to deploy capital efficiently,

adversely impact our competitive positions or otherwise materially adversely affect our investment activities.  Failure to

comply with these laws and regulations, or allegations of non-compliance, could prevent us from completing transactions, and

could subject us, our employees and our portfolio companies to civil or criminal sanctions, fines, penalties, remediation

obligations, restrictions on investment activities, enhanced monitoring or oversight, requirements to divest or restructure

investments, and significant reputational harm.  See also “—Adverse regulatory actions may result in significant sanctions,

liabilities, operational restrictions, litigation, reputational harm and other material and adverse impacts to our business”.

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Financial crime laws may limit our investment and capital raising activities and subject us to adverse

regulatory consequences.

Our business is subject to a wide range of laws and regulations relating to the prevention of financial crime, including

anti-corruption, economic sanctions, and anti-money laundering and countering the financing of terrorism ("AML/CFT") and

similar laws and regulations administered by U.S. and non-U.S. governmental authorities. These include, among others, FCPA,

economic sanctions and trade control laws and regulations administered by the U.S. Department of the Treasury’s Office of

Foreign Assets Control, the U.S. Department of Commerce, and the U.S. Department of State, AML/CFT requirements

administered by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network, as well as similar laws and

regulations administered by non-U.S. authorities, including EU and UK sanctions regimes and the UK Bribery Act. These laws

and regulations are complex, may in some cases impose liability regardless of intent or knowledge, may be applied

extraterritorially, and may impose overlapping or conflicting requirements, creating significant compliance and enforcement

risk.

Compliance with financial crime laws can be highly fact-specific and often requires collection of and depends on

information regarding counterparties, including ownership structures, business practices, and historical conduct, which may

be incomplete, inaccurate, or difficult to obtain, particularly in connection with cross-border transactions or investments in

jurisdictions with less developed regulatory regimes. These risks are heightened by our ownership of, and investment in,

portfolio companies operating across numerous jurisdictions and industries. In certain circumstances, we or our personnel

could be subject to investigations, enforcement actions, or liability arising from the conduct of portfolio companies, joint

venture partners, or other third parties, including under theories of control person, successor, aiding-and-abetting, or

facilitation liability. In particular, under U.S. economic sanctions, the FCPA and similar laws and regulations, we may be held

liable for conduct engaged in by portfolio companies or their employees, agents, or intermediaries, including conduct that

occurred prior to our investment or without our knowledge.

Compliance with financial crime laws is required throughout the lifecycle of our investments, including when we acquire

investments, and exit or sell investments. In these contexts, we must assess whether funds paid or received in connection

with an acquisition, financing, or disposition could be transferred, directly or indirectly, to persons or entities subject to

sanctions or other restrictions. Limitations on our ability to obtain complete or reliable information regarding sellers, buyers,

beneficial owners, intermediaries, or payment flows, or changes in applicable laws and regulations or sanctions regimes may

require changes to transaction structures, reduce proceeds, or expose us to enforcement risk.

Compliance with financial crime laws can also have a material impact on our fundraising, capital-raising, and syndication

activities, including limitations on the admission of investors into our funds and the participation of co-investors in our

transactions. In these contexts, we may be required to assess the identity, ownership, source of funds, and jurisdictional

nexus of investors, lenders, and co-investors, and applicable restrictions may limit participation, delay or prevent capital

formation or syndication, require enhanced diligence or contractual protections, or otherwise adversely affect our ability to

raise capital or complete transactions.

Compliance with financial crime laws can be costly and resource-intensive, requiring significant investment in personnel,

systems, controls, training, and third-party advisers, and may limit the jurisdictions, industries, counterparties, or investment

opportunities we are able to pursue. Failure to comply with these laws and regulations, or allegations of non-compliance,

could subject us and our portfolio companies to civil or criminal sanctions, remediation obligations, restrictions on business

activities, enhanced monitoring or oversight, requirements to divest or restructure investments, and significant reputational

harm.  See also “—Adverse regulatory actions may result in significant sanctions, liabilities, operational restrictions, litigation,

reputational harm and other material and adverse impacts to our business”.

Our investment vehicles and insurance subsidiaries could become subject to the fiduciary responsibility

and prohibited transaction provisions of ERISA and Section 4975 of the Code, which would adversely

affect our businesses.

Our investment vehicles are structured and operated in a manner intended to avoid being treated as holding plan assets

for purposes of ERISA and Section 4975 of the Code, and we seek to conduct our investment management activities in a

manner consistent with applicable exemptions and exceptions. However, if any of our investment vehicles or insurance

subsidiaries were determined to hold plan assets for purposes of ERISA, or if an applicable exemption or exception were

unavailable, we could become subject to the fiduciary responsibility and prohibited transaction provisions of ERISA and the

Code, which could materially adversely affect our business.

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We or certain of our investment vehicles could potentially be held liable under ERISA for the pension obligations of one or

more of our portfolio companies if we or the investment vehicle were determined to be a “trade or business” under ERISA

and deemed part of the same controlled group as the portfolio company under such rules, or if we were otherwise to become

jointly and severally responsible for any such pension liabilities.  In addition, if a similar rationale were expanded to apply also

for U.S. federal income tax purposes, then certain of our investors could be subject to increased U.S. income tax liability or

filing obligations in certain contexts.  Similar laws and theories that could be applied with similar results also exist outside of

the United States.

Although we do not currently rely on the qualified professional asset manager (“QPAM”) exemption under ERISA in any

material respect, certain of our affiliates and we, in the future, may rely on the QPAM exemption in connection with

managing plan assets. The availability of the QPAM exemption may be lost or rendered unavailable as a result of criminal

convictions, regulatory actions, or other disqualifying events involving the relevant investment adviser or certain affiliated

entities or individuals, including conduct unrelated to the management of plan assets. Any such loss or unavailability could

expose us or our investment vehicles to prohibited transaction liability, restrict our ability to manage plan assets, require

restructuring of affected arrangements, or otherwise materially adversely affect our business. Moreover, if the general

accounts or separate accounts of one or more of our insurance subsidiaries were to constitute plan assets for purposes of

ERISA, in the absence of an exemption we could incur liability under the prohibited transaction provisions of ERISA and the

Code as a result of any our investment management activities with respect to, or transactions involving our insurance

subsidiaries, and we could become prohibited from being compensated for managing our insurance subsidiaries’ assets.

See also “—Adverse regulatory actions may result in significant sanctions, liabilities, operational restrictions, litigation,

reputational harm and other material and adverse impacts to our business”.

Sustainability-related laws and disclosure requirements may increase compliance costs and subject us

to enforcement risks and reputational risks.

We and certain of our investment vehicles and portfolio companies are or may become subject to sustainability-related

laws, regulations, and disclosure requirements. Our business could be adversely affected if we, our investment vehicles or our

portfolio companies fail to comply with applicable sustainability requirements, including as a result of increased compliance

costs, regulatory enforcement activity, litigation, or reputational harm. New or amended sustainability rules, regulations,

enforcement priorities, or interpretations of existing laws may result in enhanced disclosure or other compliance obligations

and could adversely affect our investment activities and ability to raise capital.

In the European Union, we and certain of our investment vehicles and portfolio companies are or may become subject to

sustainability-related rules and guidance, including the Sustainable Finance Disclosure Regulation, the Corporate Sustainability

Reporting Directive, and the Corporate Sustainability Due Diligence Directive, each of which, if applicable, could impose

significant disclosure, reporting, or due diligence requirements. In addition, we, our investment vehicles and portfolio

companies may also become subject to sustainability-related regulations in the United States, including the California Climate-

Related Financial Risk Act (SB 261) (which is temporarily enjoined) and the California Climate Corporate Data Accountability

Act (SB 253) that is contemplated to require certain disclosures about climate-related financial risks and greenhouse gas

emissions data. On the other hand, several U.S. governmental authorities have enacted or proposed legislation and policies,

or pursued investigations and litigation, to restrict or prohibit government entities from doing business with businesses

identified as boycotting or discriminating against particular industries or from considering environmental and social factors in

their investment processes.

Compliance with sustainability-related requirements often depends on collecting, measuring, and reporting information

from portfolio companies and other third parties, which may be incomplete, inconsistent, or difficult to obtain. Sustainability-

related reporting is subject to evolving standards and methodologies and may require the use of assumptions or estimates

that could later be challenged. Collecting, measuring, and reporting sustainability information can be costly, difficult, and

time-consuming and may present operational, legal, and reputational risks.

We expect evolving sustainability-related regulation and investor expectations to require us to devote additional

resources to sustainability matters in connection with our investment activities and the management of our portfolio

companies, which will increase our expenses. Any failure to effectively manage these requirements, or any material increase

in compliance burdens, regulatory action, litigation, or reputational harm, could materially adversely affect our business,

results of operations, and financial condition. See also “—Adverse regulatory actions may result in significant sanctions,

liabilities, operational restrictions, litigation, reputational harm and other material and adverse impacts to our business”.

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Privacy, data protection, cybersecurity and artificial intelligence laws may increase compliance costs

and subject us to enforcement risks and reputational risks.

Data privacy, data protection and cybersecurity have become priorities for regulators around the world, and rapidly

evolving and changing laws and regulations, including with respect to artificial intelligence, may increase compliance and legal

costs and expose us to enforcement risk, litigation, and reputational harm. We and our portfolio companies are subject to U.S.

federal and state privacy and data protection laws and regulations. For example, the California Consumer Privacy Act provides

enhanced consumer rights, a private right of action for certain data breaches, and statutory fines, damages and penalties for

violations.  Other U.S. states have passed their own consumer privacy laws and other states are considering doing so.  At the

U.S. federal level, we are subject to the Gramm-Leach-Bliley Act of 1999, and implementing regulations, including Regulation

S-P, which governs privacy notices and the safeguarding and disposal of customer information and establishes certain incident

response and notification obligations.

Our insurance business processes sensitive personal information of policyholders, which exposes it to heightened privacy

and cybersecurity risk, and our insurance subsidiaries are subject to additional cybersecurity requirements, including the New

York State Department of Financial Services (“NYSDFS”) cybersecurity regulation, which requires covered entities to maintain

cybersecurity programs, conduct risk assessments, and satisfy certain incident reporting and governance requirements. In

November 2023, the NYSDFS finalized amendments to its cybersecurity regulations that significantly expanded the NYSDFS’

regulation of data privacy matters.

We are also subject to non-U.S. privacy and data protection laws, including the European General Data Protection

Regulation, the Personal Information Protection Law of the People’s Republic of China, the India Digital Personal Data

Protection Act 2023, the UK Data Protection Act, and similar laws in other jurisdictions. Many of these regimes have

extraterritorial reach, impose differing or conflicting requirements, and may apply to data processing activities conducted by

us, our portfolio companies, or third-party service providers. In addition, we are often subject to privacy and data security

obligations arising from contractual commitments with counterparties.

There is also increased regulatory attention about the use of artificial intelligence.   For example, the European Union has

adopted Regulation (EU) 2024/1689, which establishes a comprehensive, risk-based regulatory framework governing the

development, marketing, deployment and use of artificial intelligence systems within the European Union.

Failure to comply with applicable data privacy, data protection, cybersecurity, or artificial intelligence laws or related

contractual obligations could result in regulatory investigations or enforcement actions, private litigation, fines, penalties,

claims for damages, or adverse publicity. Even where we are not found liable, responding to investigations or claims may be

costly and time-consuming and could result in reputational harm. Regulatory enforcement activity and private litigation

relating to data privacy and cybersecurity matters have increased in recent years, and any significant enforcement action,

litigation, or reputational harm could materially adversely affect our business, results of operations and financial condition.

See also “—Adverse regulatory actions may result in significant sanctions, liabilities, operational restrictions, litigation,

reputational harm and other material and adverse impacts to our business”.

Risks Related to Our Investment Activities

In our asset management business, we sponsor and manage funds and other investment vehicles that make investments

worldwide on behalf of third-party investors and, in connection with those activities, typically deploy our own capital for a

portion of those investments.  These investments are subject to many material risks and uncertainties as discussed below.  In

addition, we manage the investments of our insurance subsidiaries and other investments on our balance sheet, including

through our Strategic Holdings business.  Because we directly bear the full risk of the investments of our insurance

subsidiaries and those on our balance sheet, including those reported in our Strategic Holdings segment, the risks and

uncertainties discussed below may have a greater impact on our results of operations and financial condition.

Future results of our investments may be different than, and may not achieve the levels of, any of our

historical returns.

We have presented in this report certain information relating to our investment returns, such as net and gross internal

rates of return (“IRR”), multiples of invested capital (“MOIC”) and realized and unrealized investment values for investment

vehicles that we have sponsored, managed or operated.  Historical returns of our investment vehicles should not be relied

upon as indicative of the future results that you should expect from our investment vehicles and are not indicative of the

future results of our insurance subsidiaries or our balance sheet assets.  The future results may differ significantly from their

historical results for a multitude of reasons, including for timing differences between the reporting of unrealized gains and

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realization events, changes in the asset classes in which our current funds invest in compared to historical asset classes,

market and economic conditions, differences in the duration of holding periods of investments and deployment periods for

investment vehicles, differences in asset mixes, industry exposures, and geographies, and the economic terms and costs

associated with our newer investment vehicles.

Various conditions and events outside of our control that are difficult to quantify or predict may have a

significant impact on the valuation of our investments.

Global equity markets, which have been and are expected to continue to be volatile, significantly impact the valuation of

our equity investments in portfolio companies.  For our equity investments that are publicly listed and thus have readily

observable market prices, equity markets around the world have a direct impact on valuation, because their values are

determined by their listed prices in the public markets.  For our equity investments that are not publicly listed, equity markets

have an indirect impact on valuation as we often consider market multiples in our valuation of illiquid assets.  In our private

equity business, a substantial amount of investments are in equities, so a change in equity prices or equity market volatility

could significantly impact the value of our private equity investments.  In our insurance business, a change in equity prices

also impacts our equity-linked annuity and life insurance products, including with respect to hedging costs related to those

products.

The credit markets can also impact the valuations of our equity investments in portfolio companies.  For example, we

typically use a discounted cash flow analysis as one of the methodologies in our valuation of illiquid assets process.  If interest

rates rise, then the assumed cost of capital for the equity investments in our portfolio companies would be expected to

increase under the discounted cash flow analysis, and this effect would negatively impact their valuations if not offset by

other factors. In our infrastructure business, a substantial amount of investments are valued using the discounted cash flow

analysis, so a change in interest rates could significantly impact the value of our infrastructure investments.

The credit markets directly impact the valuations of the credit investments that we (especially our insurance subsidiaries)

and our investment vehicles own.  Interest income earned from debt investments with floating interest rates should increase

if the applicable benchmark interest rate were to rise, and the reverse is true if the applicable benchmark interest rate were

to decline.  However, during periods of rising interest rates, the obligor of such floating rate debt may become less able to pay

its debt obligations, which could have the effect of impairing the value of its debt obligations.  For debt investments with fixed

interest rates, changes in interest rates generally will also cause the value of the fixed rate debt to vary inversely to such

changes, although any losses or gains would in most cases not be realized if the fixed rate debt is held to maturity. Increased

or unexpected payment delinquencies, foreclosures or losses could adversely affect our or our investment vehicles’ ability to

invest in, sell and securitize loans, which would materially and adversely affect our or our investment vehicles’ results of

operations, financial condition, liquidity and business.

Foreign exchange rates can materially impact the valuations of our investments that are denominated in currencies other

than the U.S. dollar.  We make investments and receive capital commitments and have liabilities that are denominated in

currencies other than the U.S. dollar.  The appreciation or depreciation of the U.S. dollar is expected to contribute to a

decrease or increase, respectively, in the U.S. dollar value of our non-U.S. investments to the extent unhedged.  For our

investments denominated in currencies other than the U.S. dollar, the depreciation in such currencies will generally

contribute to the decrease in the valuation of such investments, to the extent unhedged, and adversely affect the U.S. dollar

equivalent revenues of portfolio companies with substantial revenues denominated in such currencies, while the appreciation

in such currencies would be expected to have the opposite effect.

Conditions in commodity markets can also impact the valuations of our investments in a variety of ways, including

through the direct or indirect impact on the cost of the inputs used in their operations, as well as the pricing and profitability

of the products or services that they sell.  The price of commodities has historically been subject to substantial volatility,

which among other things, could be driven by economic, monetary, geopolitical or other factors.  Further, if the operating

partners for certain of our investments are unable to raise prices to offset increases in the cost of raw materials or other

inputs, including the cost of energy and transportation, or if customers defer purchases of or seek substitutes for these

products, these investments could experience lower operating income which may in turn reduce their valuation.  With respect

to our investments in energy-related companies, when commodity prices decline or if a decline is not offset by other factors,

the revenues, operating results, profitability and liquidity of the businesses related to such energy-related companies may be

adversely affected.

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The market values of real estate assets may be adversely affected by a number of factors, including national, regional and

local economic conditions; construction quality, age and design; demographic factors; tenant demand, market occupancy and

rental rate trends; and capitalization rates.  Declining real estate values significantly increase the likelihood that we or our

investment vehicles will incur losses on loans in the event of default because the value of our collateral may be insufficient to

cover the costs on the loan.

Financial markets and economic conditions are outside our control and may affect the level and volatility of securities

prices and liquidity and as a result, the value of our investments and our financial results. In addition, if we are unable to or

choose not to manage our exposure to these conditions and/or events and such impact is not otherwise offset, then declines

in the equity, commodity and debt in the markets would likely cause us to write down our investments and the investments

of our funds.  For example, during the global financial crisis in 2008 and 2009, valuations of our private equity funds declined

across all geographies, with investments in private equity funds marked down to as low as 67% of original cost and multiples

of invested capital reaching as low as 0.5x, 0.6x, 0.7x and 0.8x for the European Fund II, European Fund III, 2006 Fund and

Asian Fund, respectively, as of March 31, 2009.

The valuations of our investments can be impacted by many other factors unrelated to market or economic conditions,

including:

• global, regional and local events outside of our control, including geopolitical events, natural disasters, and

catastrophes;

• climate-related risks, including the impacts of changes in the physical climate, such as extreme weather or

temperature changes, which may damage physical assets as well as disrupt connectivity and supply chains, in

addition to climate-related transition risks that may arise from exposure to the transition to a low-carbon economy

through policy, regulatory, technology, market changes, differing perspectives of stakeholders regarding climate

impacts, business trends, and changes in consumer behavior related to climate change and technology; and

• developments in and adoption of artificial intelligence technologies, which may render existing products, services, or

business models of the companies in which we invest to become obsolete, less competitive, or require significant

and unanticipated additional investment to remain viable.

For a discussion of certain recent market or economic conditions, see also “Management's Discussion and Analysis of

Financial Condition and Results of Operations—Critical Accounting Policies and Estimates”.

Many of our investments are illiquid, and it may not be possible to realize any profits from them  for a

considerable period of time or at all.

We and our investment vehicles hold investments in securities that are not publicly traded.  In many cases, we may be

prohibited by contract or by applicable securities laws from selling such securities at many points in time.  Our ability to

dispose of investments also is heavily dependent on the capital markets and, in particular, the public equity markets.  For

example, the ability to realize any value from an investment may depend upon the ability to complete an initial public offering

of the portfolio company in which such investment is made.  Even if the securities are publicly traded, large holdings of

securities can often be disposed of only over a substantial length of time, exposing our investment returns to risks of

downward movement in market prices during the intended disposition period.  In addition, market conditions and the

regulatory environment can also delay and, in certain cases, materially impair, our ability to exit and realize value from these

investments.  Although the equity markets are not the only means by which we exit investments from our funds, the strength

and liquidity of the relevant equity for the portfolio company, and the initial public offering market specifically, affect the

valuation of, and our ability to successfully exit, our equity positions in the portfolio companies in a timely manner.  Difficult

market and economic conditions could increase the cost of credit or cause a degradation in debt financing terms for potential

buyers, either of which may adversely impact our ability to identify, execute and exit investments on attractive terms.

Government policies regarding certain regulations, such as antitrust law, national security or restrictions on foreign direct

investment in certain of our portfolio companies or assets can also limit our and our investment vehicles’ exit opportunities.

In addition, many of our investment vehicles have a finite term, and we may also be forced to dispose of investments sooner

than otherwise desirable.  Accordingly, under certain conditions, our investment vehicles may be forced to either sell their

investments at lower prices than they had expected to realize or defer sales that they had planned to make, potentially for a

considerable period of time.

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The valuations of illiquid investments are subjective and uncertain, and any realizations of our illiquid

investments may occur at prices which differ from their carrying values.

There are no readily ascertainable market prices for a substantial majority of illiquid investments held by us and our

investment vehicles. We generally determine the fair value of the investments of our funds in accordance with accounting

principles generally accepted in the United States of America (“U.S. GAAP”).  U.S. GAAP requires the application of accounting

guidance and policies that often involve a significant degree of judgment.  These accounting estimates require the use of

assumptions, some of which are highly uncertain at the time of estimation and can be incomplete or inaccurate despite our

engagement of third parties to assist with certain aspects of our valuations.

The amount of judgment and discretion inherent in valuing assets renders valuations uncertain and susceptible to

material fluctuations over possibly short periods of time.  Our determination of an investment’s fair value may differ

materially from the value that would have been determined if a ready market for the securities had existed and the valuations

the general partners of other funds or other third parties ascribe to the same investment.  In addition, the range of potential

valuation methodologies and the potential exercise of our subjective judgment in determining valuation might cause some of

our investors or regulators to question our valuations or methodologies.  There can be no assurance that our policies will

address all necessary valuation factors or completely eliminate potential conflicts of interest in such determinations or that

we will be able to achieve some valuations.

The valuations of and realization opportunities for investments made by us and our investment vehicles could also be

subject to high volatility as a result of uncertainty regarding various risks described in these risk factors.  Due to the lapse of

time between valuations, subsequent events that may have a significant impact on valuations will not be reflected until the

next valuation date.  Changes in values attributed to investments may result in volatility in our AUM and could materially

affect the results of operations that we report from period to period.  In addition, estimates, inputs, assumptions, and other

determinations made in connection with how various valuation methodologies are employed may also change from time to

time.  Our valuation of an investment at a measurement date may also differ materially from the value that is obtained upon

the investment’s exit.  If the investment values that we record from time to time are not ultimately realized, it could have a

material adverse effect on our results of operations, financial condition and cash flow.

Further, certain of our investment vehicles offered to individual investors calculate net asset value (“NAV”) on a daily or

monthly basis for purposes of establishing the price at which those investment vehicles sell and repurchase their shares.  The

methods used to calculate NAV are not prescribed by the rules of the SEC or any other regulatory agency. There are no

accounting rules or standards that prescribe which components should be used in calculating NAV, and the NAV of such

vehicles are not audited by our independent registered public accounting firm. Errors may occur in calculating such NAV,

which could impact the price at which the shares of our investment vehicles offered to individual investors are sold and

repurchased.

Also, if realizations of our investments produce values materially different than the carrying values reflected in an

investment vehicle’s previous valuation, investors in such vehicles may lose confidence in us, which could in turn result in

difficulty in raising capital for future funds or other investment vehicles.  Some of our investors and regulators may question

our valuations or methodologies.  The SEC has focused on issues related to valuation of private investment vehicles, including

frequency, consistent application of the methodology, disclosure, and conflicts of interest, in its enforcement, examination,

and rulemaking activities.  For information about our valuation methodologies and processes, please see Note 2 “Summary of

Significant Accounting Policies—Fair Value Measurements” in our financial statements.

We often pursue investment opportunities that involve unique business, regulatory, legal, tax or other

complexities that entail significant risks.

We often pursue complex investment opportunities, which may often involve substantial business, regulatory or legal

complexities. Our tolerance for complexity presents significant risks, as such transactions can be more difficult, expensive and

time consuming to finance and execute, and it can be more difficult to manage or realize value from these types of

investments. Other risks that are often inherent in these kinds of transactions include:

Our transactions may entail a high level of regulatory scrutiny, and our investment may be subject to complex regulatory

requirements and instances of non-compliance at the investment level may subject us to reputational harm or, in certain

cases, liability;

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• Our transactions may involve complex tax structuring that could be challenged or disregarded, which may result in

losing treaty benefits or otherwise adversely impact our investments; complex tax structures are costly to establish,

monitor and maintain, and as we pursue a larger number of transactions across multiple assets classes and in

multiple jurisdictions, such costs will increase and the risk that a tax matter is overlooked or inadequately or

inconsistently addressed may increase;

• Our transactions may involve an investment that is subject to significant liabilities, including contingent liabilities,

which could be unknown to us at the time of acquisition or, if they are known to us, we may not accurately assess or

protect against the risks that they present, which could result in material unforeseen losses;

• We rely on the management of our portfolio companies or other third-party operators to provide for financial

projections and other information about their companies, businesses or assets, which may not be accurate or

realistic and thus could result in performance that falls short of our expectations or even result in such company’s

bankruptcy; we also rely on the management of our portfolio companies or other third-party operators, and their

systems and processes, for ongoing financial and other information in support of the valuations of our investments in

or with them; and

• Our dispositions of investments may result in the incurrence of contingent liabilities by us or an investment vehicle;

for example, if we or an investment vehicle required to make representations about the investment and are required

to indemnify the purchasers of such investment for misrepresentations.

We also make large private equity and real assets investments, which involve certain complexities and risks that are not

encountered in small- and medium-sized investments.  For example, when we enter into large transactions we often seek to

syndicate a portion of our capital commitment to third parties.  However, if we are unable to syndicate all or part of such

commitment, or if such co-investors fail to fund their commitments, we may be required to fund the remaining commitment

amount from our balance sheet, and poor performance of such large investment may have a material adverse impact on our

financial results.  Furthermore, investments by many of our investment funds will include debt instruments and equity

securities of companies that we do not control.  Consortium transactions generally entail a reduced level of control by our

firm over the investment because governance rights must be shared with the other consortium investors.  Accordingly, we

may not be able to control decisions, including decisions relating to the management and operation of the company and the

timing and nature of any exit, which could result in the risks described herein.

In addition, our growth equity investment vehicles may make investments in companies which are in a conceptual or

early stage of development.  These companies are often characterized by new technologies and products, quickly evolving

markets, management teams that are materially dependent on a founder or key executives or may have limited experience

working together, in many cases, negative cash flow, and dependence on intellectual property rights, as well as other

substantial business and operational risks, all of which pose obstacles to the ultimate success of such investments.  In

addition, growth equity companies may be more susceptible to macroeconomic effects and industry downturns, and their

valuations may be more volatile depending on the achievement of milestones, such as receiving a governmental license or

approval.

We use a significant amount of leverage in our investment activities, and our portfolio companies and

investments may have significant credit and liquidity requirements, which may be materially and

adversely affected by changes in financial markets.

We and our investment vehicles typically use a significant amount of leverage as part of our investment strategy and

regularly borrow a substantial amount of capital for operations and investments. With respect to our private equity and real

assets businesses, if we are unable to obtain committed debt financing for potential acquisitions or can only obtain debt at an

increased interest rate or on unfavorable terms, we may have difficulty completing otherwise profitable acquisitions or may

generate lower profits, either of which could lead to a decrease in the investment income earned by us.  Any failure by

lenders to provide previously committed financing can also expose us to potential claims by sellers of businesses that we may

have contracted to purchase.  Our ability to generate returns on these assets would be reduced to the extent that changes in

market conditions, including changes to interest rates, cause the cost of our financing to increase relative to the income that

can be derived from the assets acquired or financed.  Significant stress in the credit markets is likely to materially affect our

business. For example, the turmoil in the global financial markets during 2008 and 2009 provoked significant contraction in

the availability of credit and the failure of a number of companies, including leading financial institutions.  Our business was

materially and adversely affected by the global financial crisis due to a significant reduction in the availability of credit, less

favorable terms for available credit, and a material reduction in deal activity, which limited our exit and new investment

opportunities.

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We have equity and debt investments in companies that have a significant amount of leverage as well as companies that

are currently experiencing, or in the future may experience, significant financial or business difficulties.  Our portfolio

companies often incur debt in connection with our acquisition of it, and our portfolio companies regularly utilize the

corporate debt markets to obtain financing for operations.  To the extent that credit markets render such financing difficult to

obtain or more expensive, this may negatively impact our performance (and in particular our insurance business) and the

performance of such portfolio companies.  In addition, to the extent that conditions in the credit markets impair the ability of

our portfolio companies to refinance or extend maturities on their outstanding debt, either on favorable terms or at all, the

performance of those portfolio companies may be negatively impacted, which could impair the value of our investment in

those portfolio companies and lead to a decrease in the investment income earned by us.  In some cases, the inability of our

portfolio companies to refinance or extend maturities may result in the inability of those companies to repay debt at maturity

or pay interests when due, and may cause the companies to sell assets, undergo a recapitalization or seek bankruptcy

protection, any of which would likely materially impair the value of our investment and lead to a decrease in the investment

income earned by us.  Investments in leveraged companies or companies experiencing financial or business difficulties

generally entail greater risk, including relating to contractual restrictions on the operations of its businesses and significantly

higher debt service costs, and such investments are also inherently more sensitive to declines in their company’s revenues,

increases in their company’s expenses, interest rate changes, and other adverse economic, market and industry

developments. As a result, the risk of loss associated with a leveraged company is generally greater than for comparable

companies with comparatively less debt.

In addition, our and our investment vehicles’ exposure to CLO markets may exacerbate risks associated with leverage and

borrowing, as these CLOs generally involve a higher degree of risk than investment grade-rated debt.  We have significant

exposure to these markets through our CLO vehicles. In most cases, our CLO holdings are deeply subordinated, representing

the CLO vehicle’s substantial leverage, which increases both the opportunity for higher returns as well as the magnitude of

losses when compared to holders or investors that rank more senior to us in right of payment.  During any time that a CLO

issuer exceeds applicable contractual limits on certain obligations it can hold, the ability of the CLO’s manager to sell assets

and reinvest available principal proceeds into substitute assets is restricted.  In such circumstances, CLOs may fail certain

over-collateralization tests, which would cause diversions of cash flows away from us as holders of the more junior notes of

our CLOs, which may impact our cash flows.  The ability of the CLOs to make interest payments to the holders of the senior

notes of those structures is highly dependent upon the performance of the CLO collateral.  If the collateral in those structures

were to experience a significant decrease in cash flow due to an increased default level, payment of all principal and interest

outstanding may be accelerated.  If these vehicles are unable to maintain their operating results and access to capital

resources, they could face substantial liquidity problems.  These CLO strategies and the value of the assets of such CLO

vehicles are also sensitive to changes in interest rates because these strategies rely on borrowed money and because the

value of the underlying portfolio loans can fall when interest rates rise. As a result of their use of large amounts of leverage,

CLOs are at greater risk of suffering material losses.

The due diligence process that we undertake in connection with our investments may not reveal all

facts that may be relevant in connection with an investment.

Before making our investments, we seek to conduct due diligence that we believe to be reasonable and appropriate

based on the facts and circumstances applicable to each investment.  When conducting due diligence, we typically evaluate a

number of important business, financial, accounting, sustainability, technological, tax, regulatory and legal issues and

macroeconomic trends in determining whether or not to proceed with an investment.  When conducting due diligence and

making an assessment regarding an investment, we rely on resources available to us, including information provided by the

target of the investment and, in some circumstances, third-party investigations.  The due diligence process is often subjective,

and only limited information may be available. For some strategies or investment opportunities, our due diligence may be

limited to only publicly available information. Accordingly, we cannot be certain that the due diligence investigation that we

will carry out with respect to any investment opportunity will reveal or highlight all relevant considerations that may be

necessary or helpful in evaluating such investment opportunity, including the existence of contingent liabilities.

In addition, instances of bribery, fraud, accounting irregularities and other improper, illegal or corrupt practices can be

difficult to detect, and fraud and other deceptive practices can be widespread in certain jurisdictions.  Several of our

investment vehicles invest in emerging market countries that may not have established laws and regulations that are as

stringent as those in more developed nations, or where existing laws and regulations may not be consistently enforced.  Due

diligence on investment opportunities in these jurisdictions is frequently more complicated because consistent and uniform

commercial practices in such locations may not have developed.  Bribery, fraud, accounting irregularities and corrupt

practices can be especially difficult to detect in such locations.

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Investments in real assets may expose us and our investment vehicles to greater risks, liabilities and

operational complexities than investments in operating companies.

Our investments in real assets, such as real estate, infrastructure and energy, may subject us and our investment vehicles

to risks that are unique to the ownership, development and operation of physical assets. These risks include, among others:

• exposure to environmental laws and regulations that may impose strict or joint and several liability without regard to

fault, including liabilities arising from conditions existing prior to acquisition or arising after disposition, and liabilities

resulting from changes in applicable laws or standards;

• risks of personal injury, property damage, business interruption or catastrophic loss arising from natural disasters,

severe weather events, climate change (including both physical and transition risks), equipment failure, construction

defects, or other force majeure events, which may result in uninsured or underinsured losses, contractual claims,

reputational harm or other material liabilities;

• reliance on third-party operators, property managers, developers, contractors, sub-contractors, and other service

providers, whose failure to perform, misconduct (including fraud, bribery or other violations of law), or non-

compliance with applicable agreements or laws may materially adversely affect the value or operation of an asset

and expose us to liability or reputational damage;

• extensive and evolving federal, state, local and foreign laws and regulations governing land use, zoning, permitting,

labor, health and safety, rate setting, licensing, concessions, public procurement and other matters, including the risk

of delays, cost overruns, loss of permits or licenses, limitations on pricing, fines, sanctions, injunctions or criminal

penalties;

• ongoing arrangements with federal, state, local or foreign governments or regulatory authorities, including

partnerships and joint ventures, which may subject us to additional contractual, regulatory, political or performance-

related obligations and expose us to risks arising from changes in government priorities, financial condition or force

majeure;

• development, construction and redevelopment risks, including entitlement and permitting uncertainties, cost

inflation, supply chain disruptions, labor shortages, delays in completion, defects, the inability to obtain or maintain

financing on acceptable terms (including exposure under “bad boy” guarantees or similar arrangements); and

• asset-specific risks, including heightened political and public scrutiny of institutional ownership of certain asset

classes (such as single family homes or residential housing), exposure to reimbursement regimes and care-related

liabilities in healthcare facilities, and the dependence of infrastructure assets on long-term governmental licenses,

concessions, contracts or rate regulation, which may be modified, terminated, not renewed or subject to increased

regulatory oversight.

We make investments outside of the United States, which may expose us to additional risks, or

materially exacerbate risks, that are not typically associated with investing in the United States.

We invest a significant portion of our AUM in the equity, debt, loans or other securities of issuers and in other assets that

are based outside of the United States.  Investing in companies or assets that are based or have significant operations in

countries outside of the United States and, in particular, in emerging markets such as China and India, Eastern Europe, South

and Southeast Asia, Latin America and Africa, involves risks and considerations that are not typically associated with

investments in companies or assets established in the United States.  These risks may include, in addition to more volatile or

adverse market and economic conditions than the U.S., the following:

• the imposition of non-U.S. taxes with respect to certain assets and/or changes in tax law;

• limitations on borrowings to be used to fund acquisitions or dividends;

• limitations on the deductibility of interest and other financing costs and expense for income tax purposes in certain

jurisdictions;

• limitations on permissible counterparties in our transactions or consolidation rules that effectively restrict the types

of businesses in which we may invest;

• political risks generally, including political and social instability, nationalization, expropriation of assets or political

hostility to investments by foreign or private equity investors;

• reliance on a more limited number of commodity inputs, service providers or distribution mechanisms;

• fluctuations in foreign exchange rates;

• less government supervision of exchanges, brokers and issuers;

• less developed bankruptcy and other laws;

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• difficulty in enforcing contractual obligations;

• lack of uniform or robust accounting, auditing, financial reporting standards, practices and disclosure requirements,

and less government supervision and regulation;

• less stringent requirements relating to fiduciary duties; and

• risks described under “Risks Related to Regulatory Matters—Financial crime laws may limit our investment and

capital raising activities and subject us to adverse regulatory consequences.”

If we fail to effectively manage conflicts of interest that arise from our investment activities, our

reputation, business or financial results could be materially and adversely impacted or we may become

subject to regulatory scrutiny or litigation.

As we have expanded and as we continue to grow and expand our businesses, we often confront potential conflicts of

interest relating to our investment activities.  For example:

• Potential conflicts may arise with respect to allocation of investment opportunities among us, our investment

vehicles and our affiliates, including to the extent that the applicable fund documents do not mandate a specific

investment allocation. For example, we may allocate an investment opportunity that is appropriate for two or more

investment vehicles in a manner that excludes one or more vehicles or results in a disproportionate allocation based

on factors or criteria that we determine. Moreover, the challenge of allocating investment opportunities to certain

vehicles and managing any conflicts of interest may be exacerbated as we expand our business to include more lines

of business, including as we increasingly undertake business initiatives to increase the number and types of

investment products and vehicles we offer to individual investors;

• Conflicts of interest may arise between one or more investment vehicles, on one hand, and our firm or our balance

sheet assets (including through our Strategic Holdings business), on the other, with respect to the purchase or sale of

investments or the allocation of such opportunities, the structuring or exercise of rights with respect to investments,

and the advice we provide to our investment vehicles (including our insurance subsidiaries);

• We or our investment vehicles may invest in a portfolio company that is a competitor, service provider, supplier,

customer, or other kind of counterparty with respect to a portfolio company in which we or another investment

vehicle hold an investment;

• We are required to act in the best interests of our funds, and so we may take actions that favor the interests of our

funds over our own, which could result in less investment or other income for us; e.g., we may structure an

investment in a manner that may be attractive to investment vehicle investors from a tax perspective even though

we would be required to pay corporate taxes;

• We are required to allocate investment opportunities among investment vehicles that may have overlapping

investment objectives, which may result in investments being allocated to investment vehicles that are less

profitable for us;

• A dispute may arise between us and the portfolio companies of the funds we manage, and the investors in the funds

we manage may be dissatisfied with our handling of such dispute;

• A decision to pursue an investment opportunity for a particular investment vehicle (or our own account) may result

in our having to restrict the ability of other investment vehicles (or our own account), e.g., the acquisition of

maternal non-public information about a company may preclude other investment opportunities that could be

available with respect to the securities of such company, or the acquisition of a company could give rise to antitrust

or other regulatory restrictions that prevent, prohibit or restrict similar investment opportunities for other

investment vehicles or portfolio companies;

• Our employees have made personal investments in a variety of our investment vehicles typically on a no-fee, no-

carry basis, which may result in conflicts of interest with the investors of our investment vehicles with respect

investment decisions for these investment vehicles;

• Our entitlement to receive carried interest from many of our investment vehicles may create an incentive for us to

make riskier and more speculative investments on behalf of an investment vehicle than would be the case in the

absence of such an arrangement; in addition, investments must be held for more than three years under U.S. tax

laws for carried interest to be treated for U.S. federal income tax purposes as long-term capital gain, which may

create a conflict of interest between the limited partner investors (whose investments would receive such long-term

capital gain treatment after a holding period of only one year) and us as the general partner on the execution, closing

or timing of sales of investments;

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• From time to time, one of our funds or other investment vehicles (including CLOs) may seek to effect a purchase or

sale of an investment with one or more of our other funds or other investment vehicles in a so-called cross

transaction under U.S. securities laws, or we as a principal may seek to effect a purchase or sale of our investment

with one or more of our funds or other investment vehicles in a so-called principal transaction under U.S. securities

laws;

• We own or control service providers that provide services to our investment vehicles or their investments, which

could give rise to a number of claims of conflicts of interest, including that such service provider is being

unnecessarily engaged or is being engaged at rates or terms that are no on an arms-length arrangement or that

payments by such investment vehicles or investment unfairly benefit us;

• Our investment vehicles invest in a broad range of asset classes throughout the corporate capital structure. In certain

cases, we or our investment vehicles may invest in different parts of the same company’s capital structure, and the

interests of KKR and our investment vehicles may not always be aligned, which could create actual or potential

conflicts of interest or the appearance of such conflicts. We may also cause different funds that we manage to

purchase different classes of securities in the same portfolio company. For example, one of our CLO funds could

acquire a debt security issued by the same company in which one of our private equity funds owns common equity

securities. A direct conflict of interest could arise between the debt holders and the equity holders if such a company

were to become financially distressed; and

• We may also invest, or cause different investment vehicles to invest, in a single portfolio company, for example,

where the investment vehicle that made an initial investment no longer has capital available to invest. We may also

establish other investment vehicles, which we refer to as “continuation vehicles”, for the purpose of purchasing one

or more investments from us or one or more of our other investment vehicles. In such circumstances, we are acting

on behalf of, and making the investment decision for each of the entities involved in the relevant transaction.

Allocating investment opportunities frequently involves significant and subjective judgments. The risk that investors in

our investment vehicles or regulators could challenge allocation decisions as inconsistent with our obligations under

applicable law, governing fund agreements, or our own policies cannot be eliminated. Moreover, the perception of

noncompliance with such requirements or policies could harm our reputation with investors in our investment vehicles. An

investment adviser’s conflicts of interest continue to be a significant area of focus for investors, regulators, and the media.

Because of our size and the variety of businesses and investment strategies that we pursue, we may face a higher degree of

scrutiny compared with investment advisers that are smaller or focus on fewer asset classes. Investors and potential investors

in our different types of investment vehicles, including those designed either primarily for institutional investors or individual

investors, may scrutinize any perceived conflict of interest between allocation decisions for institutional investment vehicles

on the one hand and individual investment vehicles on the other hand and may decide not to invest with us if they do not

agree with how we address potential conflicts of interest and allocation decisions. Any steps taken by a regulator to preclude

or limit certain conflicts of interest could make it more difficult for our investment vehicles to pursue transactions that may

otherwise be attractive to their investors.

While we will try to mitigate these conflicts of interests, we may be unsuccessful in such mitigation efforts, or we may be

obliged to take an action or refrain from taking an action that would be disadvantageous to us as a firm.  Certain policies and

procedures implemented to mitigate potential conflicts of interest and address certain regulatory requirements may reduce

the synergies across our various businesses as we have multiple business lines and regulated affiliates subject to different

regulations pertaining to conflicts of interest. As a consequence of such policies and procedures, we may be precluded from

providing such information or other ideas to our other businesses even where it might be of benefit to them.  Our failure to

mitigate successfully a conflict of interest could result in a violation of our obligations under applicable governing documents

or applicable law, giving raise to potential challenges or litigation by our fund investors or regulators. In addition, our

regulators may decide to preclude or limit certain conflicts of interest could make it more difficult for our investment vehicles

to pursue transactions that may otherwise be attractive to their investors.  To the extent we are unable to effectively manage

these conflicts of interest, our reputation, business and financial results may be adversely affected, including as a result of any

regulatory scrutiny or litigation in connection with any conflicts of interest.  For more information about these regulatory risks

and litigation risks, please see “—Risks Related to Regulatory Matters” and “—Risks Related to Our Business—We may suffer

material harm as a result of legal claims, litigations, investigations, and negative publicity”.

If our third-party investors fail to fund their capital calls when requested by us, it may materially and

adversely affect us.

Investors in our funds and certain other investment vehicles make capital commitments that our funds and other

investment vehicles are entitled to call from those investors at any time during prescribed periods.  These investors fulfilling

their commitments is necessary in order for such investment vehicles to consummate investments and otherwise pay their

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obligations when due. Although investors that do not fund a capital call would generally be subject to several possible

penalties, the impact of the penalty may not be sufficient to deter investors from defaulting on their commitments, and

investors may in the future negotiate for lesser or reduced penalties at the outset of the investment vehicle, thereby

inhibiting our ability to enforce the funding of a capital call. In addition, an investor may be prohibited from funding capital

commitments for any number of regulatory reasons, including for example, those described in “—Risks Related to Regulatory

Matters—Financial crime laws may limit our investment and capital raising activities and subject us to adverse regulatory

consequences”.  The failure to fund capital commitments may have a material adverse effect on our funds or other

investment vehicles’ ability to complete an investment, which in turn could have a material adverse effect on the funds or

other investment vehicles, including becoming potentially subject to contractual or other liabilities for the failure to fund or

lose the investment.  In addition, we may choose to, or become obligated to pay, such shortfalls in the capital needed to fund

an investment, which could materially adversely affect our liquidity, or we may sustain reputational harm, which could

negatively impact ability to compete for investment opportunities.  In addition, negative impacts to our reputation could

impact our ability to raise successor or other investment funds, which could negatively impact our AUM and ability to grow

our business.

Risks Related to our Insurance Activities

Through Global Atlantic, we operate an insurance business, which is subject to material risks and uncertainties that are

different from, and incremental to, the risks relating to our asset management business or our management of our insurance

subsidiaries’ investments. All the risks discussed below relating to Global Atlantic could materially and adversely impact KKR.

We operate in a highly competitive industry.

Our insurance business operates in highly competitive markets, and in recent years there has been a substantial increase

in competition in the life and annuities business as non-traditional firms, including those owned by or with strategic

partnerships with alternative asset managers, have entered the insurance sector. Traditional insurers and reinsurers have also

been significantly expanding their areas of expertise and product lines, which could have a significant effect on competition in

the insurance industry. These new and traditional competitors may be able to price new business aggressively, with a higher

investment risk tolerance, as part of a strategy to gain market share, or increase assets under management.

Within individual markets, our insurance business faces a variety of large and small industry participants. Large,

established insurers often operate with the benefit of well-known brands, entrenched distribution relationships, or

proprietary distribution. All of these companies compete for individual markets sales. Our flow reinsurance business may also

be impacted by competition among insurers in individual markets. The competitiveness of our insurance product offerings will

depend on the actions of its competitors and our ability to actively manage our insurance product offerings. In institutional

markets, there have been many block reinsurance transactions as many insurers continue to reevaluate their commitment to

business lines and seek reinsurance solutions as a way to de-emphasize or divest non-core businesses, reduce risk, seek

capital relief, or improve profitability. The block reinsurance and pension risk transfer markets are also experiencing

competition due to new entrants, including entrants which have strategic partnerships with alternative asset managers and

entrants based outside of the United States. Increased competition across all of our product offerings may make it more

difficult for us to identify and execute transactions with terms that are commercially acceptable based on our risk tolerance

and target return objectives. Increased competition may also increase regulatory scrutiny of individual or institutional

insurance markets activity.

Additionally, some of our competitors may be subject to less regulation or less regulatory scrutiny and accordingly may

have more flexibility to undertake and execute certain businesses or investments than we do or bear less expense to comply

with such regulations than we do.

We may not be able to identify or manage significant growth opportunities for our insurance business.

While we continue to seek to grow Global Atlantic’s business, particularly overseas, we may not be able to identify

attractive insurance markets, reinsurance opportunities or investments with returns that are as favorable as Global Atlantic’s

historical returns or grow new business volumes at historical levels, or we may face challenges in effectively managing this

growth.  To maintain or increase Global Atlantic’s investment returns, it may be necessary to expand the scope of Global

Atlantic’s investing activities to asset classes in which Global Atlantic historically has not invested, which may increase the risk

of Global Atlantic’s investment portfolio.  Growth opportunities may also be in new or adjacent product offerings and in new

jurisdictions where Global Atlantic historically has had less or no experience.  Pursuing opportunities in these new areas may

subject Global Atlantic to new and complex insurance regulations and business considerations.  If Global Atlantic is unable, or

fails, to find or manage profitable growth opportunities, it will be more difficult for it to continue to grow and could materially

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affect us.  In addition, if preferences for Global Atlantic’s individual or institutional products change or Global Atlantic is

unable to offer competitive pricing and attractive terms, our revenues and results of operations may be materially and

adversely impacted.  Moreover, as an insurance company, Global Atlantic’s ability to grow is dependent on the sufficiency of

its capital base to support that growth.  Global Atlantic may need to seek additional capital to manage its growth, and it may

not be able to maintain its current strong capital position as it grows.  As Global Atlantic grows, it must invest additional

assets, which poses increased investment risk.  Growth may also increase the risk of service problems, and Global Atlantic

may need to expend additional resources to provide consistent service.  Any service problems may create potential liability,

including reputational harm or increased scrutiny by regulators.

For more information about management of KKR’s balance sheet and access to sources of liquidity, please see “Risks

Related to Our Business—The failure to effectively manage our balance sheet could materially and adversely affect our

financial condition and results of operations” and “Risks Related to Our Business—The failure to manage, or the inability to

access, adequate sources of liquidity could materially and adversely affect KKR”.

The ability to source successful reinsurance opportunities is not guaranteed.

Global Atlantic’s institutional client business includes block reinsurance transactions, flow reinsurance, pension risk

transfer reinsurance and the issuance of funding agreements. There can be no assurance that these transactions will achieve

the results expected at the time the transactions are executed.

The size and volume of block reinsurance transactions often have and may vary widely quarter-to-quarter and annually.

Similarly, while our insurance business’s flow and PRT transactions, as well as new business volumes relating to these

products, have historically fluctuated less than block transactions, the size and volume of such transactions may also vary

widely period-to-period.  Other factors that can cause Global Atlantic’s actual experience to vary from our estimates include

macroeconomic, asset performance, business growth, demographic, policyholder behavior, regulatory and political

conditions. Additionally, to the extent Global Atlantic is unable to consummate suitable reinsurance transaction opportunities

on acceptable terms, its future growth may be negatively impacted.  Competition, in particular with respect to transaction

pricing, makes it more difficult to identify transactions with commercially acceptable terms.

Even if Global Atlantic does find suitable opportunities, it may not be able to consummate these transactions because of

the applicable regulatory requirements and approvals, or other considerations, including various insurance regulators

scrutinizing asset-intensive funded reinsurance. For example, the NAIC recently adopted a requirement for life insurers that

engage in certain reserve-financing or asset-intensive reinsurance treaties to perform robust asset adequacy testing on ceded

blocks.

Moreover, there can be no assurance that Global Atlantic will have sufficient capital available, or that such capital will be

available in the necessary entities, to continue growing this part of its business.   Global Atlantic sponsors co-invest vehicles

that raise third-party capital to participate alongside Global Atlantic through reinsurance in certain insurance business which

Global Atlantic writes during the co-invest vehicles’ investment periods.   Because these co-invest vehicles are commitment-

based structures with third-party investors, Global Atlantic is subject to the risk that certain co-invest vehicles fail or refuse to

fund their portion of a particular transaction, in which case Global Atlantic would have contractual remedies against the

defaulting co-invest vehicles, but not directly against their shareholders or lenders.   Global Atlantic is also subject to the risk

that its co-invest vehicles fail to meet their obligations under their reinsurance arrangements with Global Atlantic. Global

Atlantic may seek business or investment opportunities that may not align with the investment mandates of these co-

investment vehicles, requiring Global Atlantic to find alternate sources of capital or not pursue any such opportunities, which

may impact Global Atlantic’s financial results. If Global Atlantic enters into a reinsurance transaction, there can be no

assurance that the transaction will achieve the results expected at the time the transaction is executed.   Any transaction’s

terms are likely to be determined by qualitative and quantitative factors, including our estimates.   These transactions expose

us to the risk that actual results materially differ from those estimates.   Factors that can cause Global Atlantic’s actual

experience to vary from its estimates include macroeconomic, asset performance, business growth, demographic,

policyholder behavior, regulatory and political conditions.

As a result of any of the foregoing risks, Global Atlantic may realize materially less than the anticipated financial benefits

from reinsurance transactions, or Global Atlantic’s reinsurance transactions may be unprofitable or result in losses.

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Volatile market and economic conditions, including sustained increases or decreases in interest rates

and other interest rate fluctuations, may adversely affect our insurance business.

Global Atlantic’s business model depends on the performance of its investments to meet its policyholder liabilities. Global

Atlantic’s policyholder liabilities are sensitive to changing market and economic conditions.  Periods of significant and

sustained downturns in securities markets, increased equity volatility, reduced interest rates, or deviations in expected

policyholder behavior could cause a number of different materially adverse impacts to us, including an increase in the

valuation of our liabilities, the cost of providing policy benefits and required capital, and a reduction in the account balances

of certain products, with a resulting reduction in fees earned on and profitability of such products.  In times of difficult market

and economic conditions, Global Atlantic’s policyholders may choose to defer paying insurance premiums, stop paying

insurance premiums altogether or surrender their policies, or there could be an elevated rate of defaults within certain of

Global Atlantic’s investments.  In addition, actual or perceived difficult conditions in the capital markets may discourage

individuals from making investment decisions and purchasing Global Atlantic’s products.  The estimated cost of providing

guaranteed minimum withdrawal and death benefits of certain insurance products requires Global Atlantic to make various

assumptions about the overall performance of equity markets over the life of the product.  Therefore, significant declines in

equity markets could cause Global Atlantic to incur significant operating losses and capital increases to the extent our risk

management techniques employed to manage these uncertainties are not adequate.

Interest rate risk is a particularly significant market risk for our insurance business.  Fluctuations in market interest rates

can expose Global Atlantic to the risk of reduced income in respect of its investment portfolio, increases in the cost of

acquiring or maintaining its insurance liabilities, increases in the cost of hedging, or other fluctuations in Global Atlantic’s

financial, capital and operating profile.  This risk arises from Global Atlantic’s holdings in interest rate-sensitive assets and

liabilities, which include annuity products and long-duration life insurance policies, derivative contracts with payments linked

to the level of interest rates or with market values which fluctuate based on the level of interest rates, as well as the fixed

income assets Global Atlantic owns in its investment portfolio.  Global Atlantic seeks to cash-flow match its invested assets to

its policy liabilities and greater market volatility and uncertainty makes matching more difficult.  If Global Atlantic fails to

adequately cash flow match liabilities sold with higher benefits and interest rates fall while Global Atlantic holds that liability,

Global Atlantic may not generate its expected earnings on those liabilities and may face the risk of having to reinvest in lower-

yielding assets, thereby reducing its investment income.

Both rising and declining interest rates can negatively affect our insurance business.  This risk is present across most of

Global Atlantic’s insurance products, which can typically be surrendered for the cash value, less any applicable surrender

charge, at any time.  Higher interest rates may result in increased surrenders on interest-sensitive products, such as annuity

contracts and certain life insurance policies, as policyholders seek higher investment returns elsewhere.  This increase in

surrender outflows may create cash flow mismatches between cash received from Global Atlantic’s investments versus cash

needed to make policyholder liability payments as policyholders may surrender in higher numbers than expected.  This

mismatch could result in losses if assets must be liquidated at a loss to meet the increased policyholder obligations, which

could result in potentially significant realized losses and a corresponding reduction in net income.  Global Atlantic has and

may from time to time rotate its investment portfolio, including in connection with a new reinsurance transaction or in

connection with its insurance portfolio management, to achieve its desired asset mix.  See “—Risks Related to Our Business—

We may pursue new business opportunities, strategic initiatives, or investment opportunities that involve new or unique

business, regulatory or other complexities and risks” for further information pertaining to this strategic initiative of Global

Atlantic. Sales of investments in a higher rate environment than when the investment was made is expected to result in an

investment loss, and such loss may be significant.  Sales of investments at a loss in those scenarios has decreased, and would

be expected to decrease, our net income in that period, and such decreases can be significant.  Additionally, during a higher

interest rate environment the cost of insurance on new business is generally expected to be elevated, including higher

hedging costs, as benefits to policyholders on new business will generally be higher.

In addition, Global Atlantic expects that substantially all of its unrealized losses will not be realized as it typically intends

to hold investments until recovery of the losses, which may be at maturity, as part of its asset liability cash-flow matching

strategy.  However, Global Atlantic may be required to recognize an impairment to goodwill and may realize losses as a result

of credit defaults or impairments on investments.  An increase in surrenders or withdrawals also may cause Global Atlantic to

accelerate the amortization of certain costs and depreciation of certain assets.  During periods of falling or lower interest

rates, Global Atlantic may also face cash flow mismatches between interest earned on its investment portfolio and policy

liabilities that may be crediting higher rates.  When rates decline more policyholders might hold onto their products with

higher pre-existing crediting rates for longer than expected because those products seem more attractive, and Global

Atlantic’s ability to lower crediting rates is subject to several constraints.  Prolonged periods of low interest rates could

challenge product development and attractiveness and may also result in Global Atlantic earning lower margins on new

business volumes than it has historically earned.  Lower interest rates may reduce the demand for Global Atlantic’s insurance

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products, leading to lower sales, and may make the reinsurance solutions Global Atlantic is able to offer more expensive to

potential clients.  In a period of declining or lower interest rates, Global Atlantic’s investment earnings may decline because

existing investments may prepay or refinance and new investments will likely bear lower interest rates, and Global Atlantic

may not be able to fully offset the decline in investment earnings with lower liability costs on the products these investments

support.  In addition, the yield on Global Atlantic’s floating rate assets will decline as interest rates decline, reducing Global

Atlantic’s investment income.

During these periods, existing life insurance and annuity products also may be relatively more attractive to consumers

due to minimum guarantees, resulting in a higher percentage of contracts remaining in force than originally estimated,

causing greater claims costs and asset/liability cash flow mismatches.  Conversely, management actions to reduce rates on in-

force contracts in response to declining interest rates may result in greater surrenders than originally estimated, which may

adversely affect Global Atlantic’s earnings related to those products.

Additionally, to the extent that changes in market conditions, including changes to interest rates and net spreads, cause

the cost of our financing to increase relative to the income that can be derived from the assets acquired or financed, our

ability to generate returns on these assets would be reduced and, therefore, we may limit the volume of new originations.

While we hedge certain market risks, hedges will not mitigate all risk, and we do not hedge all risks. Moreover, market

conditions can result in significant variations in margin or collateral posting requirements for our hedges. Increases in

collateral requirements could be material and have an adverse effect on our financial condition, results of operations, liquidity

or cash flows.

The disruption of our third-party distribution network may have a material adverse effect on us.

Global Atlantic uses third-party intermediaries to distribute its retirement and preneed business products to individuals.

Global Atlantic’s distribution partners are not captive and may sell retirement and life insurance products of Global Atlantic’s

competitors.  If Global Atlantic’s competitors have more attractive insurance products than Global Atlantic, these

representatives may concentrate their efforts in selling Global Atlantic’s competitors’ products.  If Global Atlantic’s products

are not retained on or added to the platforms of its distribution partners, sales of Global Atlantic’s products may be materially

reduced.

Key distribution partners, such as banks and broker-dealers, may change their business models in ways that affect how

Global Atlantic’s products are sold, or terminate their distribution contracts with Global Atlantic, or new distribution channels

could emerge and adversely impact the effectiveness of Global Atlantic’s distribution efforts.

Distribution partners may also stop offering one or more of Global Atlantic’s products for a variety of other reasons.

Some of Global Atlantic’s distribution partners and potential distribution partners use proprietary or third-party scoring

systems in determining which products to sell.  If Global Atlantic’s scores fall to levels unacceptable to its distribution

partners, they may no longer distribute Global Atlantic’s products to their customers.  If any one of such distribution partners

were to terminate its relationship with Global Atlantic or reduce the amount of sales which it produces, our insurance

business would likely be adversely affected.

In our insurance sales, even though conducted through a distribution partner, Global Atlantic is responsible under

insurance regulations for the sales practices used by the distribution partner. In addition, even when the distribution partner

conducts the review of whether a product is suitable for the individual, if such review is required, Global Atlantic is

responsible under insurance regulations for the suitability review. Any improper practices by such distribution partners will

subject Global Atlantic to reputational harm, regulatory scrutiny, and potential regulatory actions and penalties.

If the assumptions and estimates used for our insurance business differ significantly from our actual

results, we may experience significant losses.

GAAP requires the application of accounting guidance and policies that often involve a significant degree of judgment

when accounting for insurance products.  These accounting estimates require the use of assumptions, some of which are

highly uncertain at the time of estimation.  These estimates and are based on judgment, current facts and circumstances and,

when applicable, internally developed models.  Therefore, actual results could differ from these estimates, possibly in the

near term, and could have a material adverse effect on our financial statements. These include assumptions and estimates

related to, among other things, policyholder behavior, including surrenders, lapses, longevity, mortality and morbidity, and

economic factors, including interest rates and equity markets.  Inaccuracies could result in, among other things, an increase in

policyholder benefit reserves which would result in a charge to earnings or other material adjustments to our financial

statements.  Additionally, the potential for unforeseen developments, including changes in laws, regulations or accounting

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standards, may result in losses and loss expenses materially different from the reserves initially established, which could also

materially and adversely impact Global Atlantic’s business, financial condition, results of operations and prospects.

In addition, Global Atlantic employs models to price products, calculate reserves and value assets, as well as to evaluate

risk and determine internal capital requirements, among other uses.  These models rely on estimates and projections that are

inherently uncertain, may use incomplete, outdated or incorrect data or assumptions and may not operate properly.  As we

continue to expand and evolve our insurance business, the number and complexity of models Global Atlantic employs has

grown, increasing exposure to error in the design, implementation or use of models, including the associated data input,

controls and assumptions, and the controls in place to mitigate their risk may not be effective in all cases.  While we

periodically review the adequacy of Global Atlantic’s reserves and the assumptions underlying those reserves at least

annually, we cannot precisely determine the amounts that Global Atlantic will pay for, or the timing of payment of, actual

benefits, claims and expenses or whether the assets supporting policy liabilities, together with future premiums, will grow to

the level assumed prior to the payment of benefits or claims.  As a result, future experience could deviate significantly from

our assumptions.  If actual experience differs significantly from assumptions or estimates, certain balances included in Global

Atlantic’s balance sheet may not be adequate.  If we conclude that Global Atlantic’s reserves, together with future premiums,

are insufficient to cover future policy benefits and claims, Global Atlantic would be required to increase its reserves and incur

income statement charges for the period in which it makes the determination, which could have a material adverse effect on

us.  Changes in regulations relating to reserves may cause fluctuations to the amount of statutory reserves held and could

adversely impact our insurance business.  The NAIC has adopted a new actuarial guideline relating to reinsurance reserves

that could result in a determination that increased reserves are advisable.  There can be no guarantee as to the impact of

changes to reserves on Global Atlantic.

Furthermore, significant estimates and assumptions are required to establish and amortize the significant costs our

insurance business incurs in connection with acquiring new and renewal insurance business.  Global Atlantic periodically

revises the key assumptions used in the calculation of the amortization of these costs; however, there is a significant level of

discretion exercised in making these determinations.  To the extent policy or contract terminations exceed projected levels or

if key assumptions are revised, then the amortization of deferred revenues and expenses will be accelerated in the period of

the change and will result in a charge to income, which could have a material adverse effect on Global Atlantic’s profitability.

Furthermore, the determination of the amount of impairments and allowances for credit losses is based upon our

periodic evaluation and assessment of known and inherent risks associated with the respective asset class and the specific

investment being reviewed.  Changes in allowances for credit losses can result in either a charge or credit to earnings.  The

assessment of whether impairments have occurred is based on a case-by-case evaluation of the underlying reasons for the

decline in fair value.  There can be no assurance that we have accurately assessed the level of impairments taken in our

financial statements and their potential impact on Global Atlantic’s regulatory capital.  Furthermore, additional impairments

and allowance provisions may be taken in the future, which could have a material adverse effect on us.

If the ratings of our insurance subsidiaries are downgraded, it may materially and adversely affect our

ability to sell our products, conduct our business, raise equity or issue debt.

Financial strength ratings are published by various nationally recognized statistical rating organizations (“NRSROs”) and

similar entities not formally recognized as NRSROs.  Rating organizations periodically review the financial performance, capital

adequacy and condition of insurers, including Global Atlantic’s insurance and reinsurance subsidiaries.  Rating agencies also

consider general economic conditions and other circumstances outside the rated company’s control in assigning a rating.  The

various rating agencies periodically review and may modify their standards, established guidelines and capital models from

time to time.

Global Atlantic’s clients and counterparties use Global Atlantic’s insurance financial strength ratings as one source to

assess its financial strength and quality.  Downgrades in Global Atlantic’s credit ratings or changes to its rating outlook, or

downgrades or changes in outlook to the financial strength ratings of Global Atlantic’s insurance subsidiaries, could have a

material adverse effect on our insurance business in many ways, including by:

• limiting access to distributors;

• limiting or preventing Global Atlantic’s ability to write new insurance policies and generate new business volumes;

• decreasing profitability;

• increasing policy lapse activity;

• limiting access to capital markets and potentially increasing the cost of debt, which could adversely affect liquidity;

• increasing regulatory scrutiny;

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• adversely affecting the pricing terms Global Atlantic can obtain; and

• triggering contractual clauses that permit the counterparty to terminate or require posting of additional collateral.

In addition, failure by Global Atlantic to maintain minimum RBC ratio requirements in certain contracts could permit the

counterparty to terminate the contract, recapture business or require posting of additional collateral.

In order to maintain its current ratings, Global Atlantic could be required to reduce its risk profile by, for example,

reinsuring and/or retroceding some of its business, materially altering its business and sales plans or by raising additional

capital.  Any such action could have a material adverse effect on us.  There is no guarantee that Global Atlantic will be able to

maintain its ratings in the future or that such ratings will not be withdrawn, and any actions taken by ratings agencies to

downgrade any of our insurance subsidiaries could result in a material adverse effect on us.

Our insurance business faces risks associated with business we cede to other reinsurers as well as

business ceded to us.

As part of Global Atlantic’s overall risk management strategy, it cedes business to other insurance companies through

reinsurance.  Global Atlantic’s inability to collect from its reinsurers (including reinsurance clients in transactions where Global

Atlantic reinsures business net of ceded reinsurance) on its reinsurance claims could have a material adverse effect on us.

Although reinsurers are liable to Global Atlantic to the extent of the reinsurance coverage it acquires, Global Atlantic remains

primarily liable as the direct insurer on all risks that it writes. Global Atlantic’s reinsurance agreements do not eliminate its

obligation to pay claims.  As a result, Global Atlantic is subject to the risk that it may not recover amounts due from reinsurers.

A reinsurer’s insolvency, or its inability or unwillingness to make payments due to Global Atlantic under the terms of the

relevant reinsurance agreements, could have a material adverse effect on us.

Global Atlantic also bears the risk that the companies that reinsure its mortality risk on a yearly renewable term increase

the premiums they charge to levels Global Atlantic deems unacceptable.  If that occurs, Global Atlantic will either need to pay

such increased premiums, or alternatively, Global Atlantic will need to limit or potentially terminate reinsurance, which will

increase the risks that Global Atlantic retains.  Conversely, certain of our insurance subsidiaries assume liabilities from other

insurance companies.  Changes in the ratings, creditworthiness or market perception of such ceding companies or in the

administration of policies reinsured to Global Atlantic could cause policyholders of contracts reinsured to Global Atlantic to

surrender or lapse their policies in unexpected amounts.  In addition, to the extent such ceding companies do not perform

their obligations under the relevant reinsurance agreements, Global Atlantic may not achieve the results intended and could

suffer unexpected losses.  Certain reinsurance transactions require additional operational support, administration, regulatory

filings and compliance with jurisdiction-specific laws and regulations, subjecting Global Atlantic to additional scrutiny and

risks.  These risks could materially and adversely affect us.

Additionally, certain of Global Atlantic’s reinsurance agreements contain triggers that, if breached, may result in the

ceding company having the right to recapture the reinsured business (i.e., by reassuming under certain circumstances all or a

portion of the risk previously ceded to Global Atlantic) or terminate the reinsurance agreement with respect to new business.

Conversely, for reinsurance transactions in which the ceding company cedes all or a portion of the risk to Global Atlantic,

Global Atlantic’s reinsurance agreements typically include a recapture right that is triggered if, for example, Global Atlantic

fails to maintain certain minimum levels of capitalization or certain minimum levels of reserves to support the business

reinsured.  These reinsurance agreements may include provisions that provide for termination of the agreement and

recapture of the business upon the occurrence of insolvency, rehabilitation, reduction in regulatory capital below specified

levels, non-payment of amounts due, material breach of contract provisions or failure to provide the ceding company with the

ability to take reserve credit.  Global Atlantic may recapture liabilities it intended to reinsure off its balance sheet and may

require additional capital to back these liabilities.  The economic, financial and liquidity impact from the loss of the recaptured

business, in addition to Global Atlantic’s economic hardships at the time of recapture, may have a material adverse effect on

In addition, if Global Atlantic assumes liability for policyholder servicing in reinsurance transactions and the reinsured

polices are not properly serviced, Global Atlantic may experience regulatory intervention, litigation or other adverse impacts.

For example, in the past, Global Atlantic experienced policyholder and agent class action litigation matters and a number of

regulatory matters stemming from service disruptions caused by a third-party administrator for life insurance policies.

Additionally, Global Atlantic holds a significant portion of its reinsurance assets in trust, which may restrict Global

Atlantic’s ability to invest those assets or to use such assets to support our liquidity needs for other purposes and also may

permit the ceding company to withdraw those assets from the trust in certain circumstances.

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Changes in tax laws or an adverse interpretation by tax authorities may adversely impact our

insurance business.

Unless the context otherwise requires, the term “Bermuda insurance subsidiaries” refers to Global Atlantic Assurance

Limited. “GAFL” refers to Global Atlantic Financial Limited, which, before January 2, 2024, was a Bermuda exempted

company. On April 1, 2016, Global Atlantic completed a reorganization of GAFL (the “GAFL Reorganization”). Because of the

GAFL Reorganization, Section 7874 limits the ability of Global Atlantic's U.S. holding company and its U.S. affiliates to utilize

certain U.S. tax attributes to offset, during the ten-year period following the GAFL Reorganization, their U.S. taxable income,

or related income tax liability, resulting from certain transfers of stock or other properties and certain income received or

accrued by reason of a license of any property by Global Atlantic's U.S. holding company and its U.S. affiliates. Effective

January 2, 2024, GAFL continued its corporate existence as a Delaware company, changing its name to Global Atlantic Limited

(Delaware). The IRS may successfully challenge GAFL’s status as a non-U.S. corporation for U.S. federal income tax purposes

before January 2, 2024. Under U.S. federal income tax law, a corporation is generally considered a tax resident of the

jurisdiction of its organization or incorporation. Because GAFL was a Bermuda-incorporated exempted entity before January

2, 2024, it would generally be classified as a non-U.S. corporation and non-U.S. tax resident for periods before 2024. Section

7874 of the Code (“Section 7874”) provides an exception to this rule under which a non-U.S. incorporated entity may, in

certain circumstances, be treated as a U.S. corporation for U.S. federal income tax purposes. Section 7874 is complex with

limited guidance regarding its application. There can be no assurance that the IRS will agree that GAFL should not be treated

as a U.S. corporation for periods before 2024. If for such periods GAFL were to be treated as a U.S. corporation for USFIT

purposes, GAFL would be subject to substantial additional historic USFIT liability, which could adversely affect us. While Global

Atlantic has taken steps to mitigate this risk, there can be no assurance that these steps will be successful.

If Global Atlantic was, or our non-U.S. insurance subsidiaries are or were, engaged in trade or business within the U.S.

(“ETB”) and subject to U.S. federal income tax, we could be materially and adversely affected. Certain Global Atlantic

subsidiaries are non-U.S. companies treated as corporations for USFIT purposes. Prior to 2024, the Bermuda insurance

subsidiaries and GAFL have conducted, and the insurance subsidiaries intend to conduct, substantially all operations outside

the U.S. and to limit their U.S. contacts with the intention that the Bermuda insurance subsidiaries not be treated as ETB.

Considerable uncertainty exists as to when a non-U.S. corporation is ETB. There can be no assurance that the IRS will not

contend that the Bermuda insurance subsidiaries are or were ETB.

There is U.S. federal income tax risk associated with reinsurance transactions, intercompany transactions and

distributions between U.S. companies and their non-U.S. affiliates, including from the Base Erosion and Anti-Abuse Tax (the

“BEAT”) on certain U.S. companies that make deductible payments to related non-U.S. companies. While we have taken steps

to mitigate the BEAT, there can be no assurance that these steps will be successful. Additionally, the Code permits the IRS to

reallocate, recharacterize, or adjust certain tax items related to a reinsurance agreement between related parties to reflect

the proper “amount, source or character” for each item. Further, the tax treatment of certain aspects of reinsurance ceded to

a non-U.S. reinsurer on a funds withheld coinsurance basis is uncertain. If the IRS were successfully to challenge Global

Atlantic's intercompany reinsurance arrangements between its subsidiaries or Global Atlantic's tax treatment of funds

withheld coinsurance with non-U.S. reinsurers (including our Bermuda insurance subsidiaries), we could be materially and

adversely affected. There are cross-border transactions in place among Global Atlantic's affiliates and non-U.S. third parties,

some of which Global Atlantic treats as loans or swaps for tax purposes. Global Atlantic expects to expand the scope of its

cross-border intercompany transactions in the future. If the IRS successfully challenges any of the foregoing items in this

paragraph or the tax treatment of these transactions, or if a change in law alters the expected tax treatment of such

transactions, we could be materially and adversely affected.

U.S. tax law changes could affect the products our insurance subsidiaries sell. Many such products benefit from tax-

favored statuses under current U.S. federal and state income tax regimes. For example, our insurance subsidiaries sell and

reinsure annuity contracts that allow the policyholders to defer the recognition of taxable income earned within the contract.

Additionally, current U.S. federal tax law permits excluding death benefits paid under life insurance contracts from taxation.

U.S. tax law changes altering the tax benefits or treatment of certain products could materially reduce demand for our

products and unpredictably affect policyholder behavior with respect to existing annuity products. Additionally, changes in

corporate or individual tax rates or the estate tax exclusion could impact the competitiveness of Global Atlantic’s product

pricing or demand, which could adversely affect us.

Bermuda enacted legislation in 2023 implementing a corporate tax aimed at certain multinational enterprises effective

for tax years beginning in 2025. Implementation may be delayed for certain groups for up to five years. The Bermuda

corporate income tax is a flat minimum tax on 15% of reported financial profits and provides for various offsets and credits.

There is uncertainty regarding the implementation of the Bermuda corporate income tax and its application to insurance

companies.

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See Note 18 “Income Taxes” in our financial statements for further information regarding tax matters and “—Risks

Related to Our Business—Changes in relevant tax laws, regulations or treaties or an adverse interpretation of these items by

tax authorities could adversely impact our effective tax rate and tax liability” for discussions of the OECD’s BEPS project.

Our insurance business is heavily regulated, and such regulations may have a material and adverse

effect on our business, financial condition and results of operations.

Our insurance and reinsurance subsidiaries are highly regulated by, among others, insurance regulators in the United

States and Bermuda, and changes in regulations affecting our insurance business may reduce Global Atlantic’s profitability

and limit its growth.  The laws and regulations of the jurisdictions in which our insurance and reinsurance subsidiaries are

domiciled or may be deemed commercially domiciled may require these companies to, among other things, maintain

minimum levels of statutory capital, surplus and liquidity, meet solvency standards, submit to periodic examinations of their

financial condition, restrict payments of dividends and distributions of capital, restrict our ability, in certain cases, to write

insurance and reinsurance policies, make certain types of investments and distribute funds, and restrict the type and

concentration of investments that can be made.  For example, due to regulatory restrictions on the payment of dividends, our

U.S. insurance subsidiaries may not declare a dividend in 2025 to the corporate parent companies of our insurance business

without prior domiciliary state regulatory approval.  Offering new products or offering products in additional jurisdictions will

also subject Global Atlantic to additional regulation and compliance requirements.

With respect to investments, our insurance and reinsurance subsidiaries must comply with applicable regulations and

statutes regarding the type and concentration of investments it may make.  Investment-related regulations include limits,

regulatory approvals of affiliate investments, permissible asset classes, capital required and limitations with respect to what

assets or portion of assets may back reserves. These restrictions may limit Global Atlantic’s ability to invest in and our ability

to earn fees on those investments.  In addition, our insurance and reinsurance subsidiaries are subject to laws and regulations

governing affiliate transactions. The investment management agreements between our investment manager and our

insurance subsidiaries were approved by the applicable U.S. and Bermuda insurance regulators, and any changes to such

agreements, including with respect to fees, must receive applicable regulatory approval. These regulations may materially and

adversely impact our insurance business’ returns and capital requirements.

In addition, our U.S. insurers are required to be members of state guaranty associations. Guaranty associations subject

insurers to assessments to pay policyholders in the event of another insurer’s insolvency. We cannot predict the amount,

nature or timing of any future guaranty assessments. Any such assessment may be material and have an adverse effect on our

financial condition, results of operations, liquidity or cash flows, and any liability we have previously established for these

assessments may be inadequate.   See also “—Risks Related to Regulatory Matters” above. Our Bermuda insurance

subsidiaries and sponsored co-investment vehicles that provide third-party capital to support our insurance business are

licensed to conduct insurance business by the BMA.   The BMA regulates and supervises each Bermuda insurer on a stand-

alone basis in Bermuda.   The Bermuda Insurance Act and the policies of and other codes issued by the BMA require each of

Bermuda insurer to, among other requirements, maintain a minimum level of capital and surplus, satisfy solvency standards,

comply with conduct guidelines, comply with restrictions on dividends, obtain prior approval or provide notification to the

BMA of changes in controlling interests by a shareholder across prescribed thresholds, make financial statement filings,

prepare a financial condition and risk management report, maintain a head office in Bermuda from which each of our

Bermuda insurance subsidiaries’ insurance business will be directed and managed, and allow for the performance of certain

periodic examinations of its financial condition.   These statutes and regulations may restrict Global Atlantic’s ability to write

insurance and reinsurance policies, distribute funds, and pursue its investment strategy.

If our relationships, or our reputation with, various regulatory authorities were to deteriorate, we could be materially and

adversely affected, including by making it more difficult, or impossible, for Global Atlantic to obtain necessary consents and

approvals.

Our insurance business may become subject to additional regulations, which may have material and adverse impact on

our business, financial condition and results of operations.

In addition to the regulations of the jurisdictions where our insurance subsidiaries are domiciled or may be deemed

commercially domiciled, Global Atlantic insurers also must obtain licenses to write insurance in other states and jurisdictions.

Our insurers follow operational guidelines designed to prevent conducting insurance business that requires a license in a

jurisdiction where the insurer is not licensed. Our non-U.S. insurance subsidiaries have and may obtain certified reinsurer and

reciprocal jurisdiction reinsurer status in various U.S. states.  Most state regulatory authorities are granted broad discretion in

connection with their decisions to grant, renew or revoke licenses and approvals that are subject to state statutes.  If Global

Atlantic is unable to renew the requisite licenses and obtain the necessary approvals or otherwise does not comply with

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applicable regulatory requirements, the insurance regulatory authorities could stop, or temporarily suspend, Global Atlantic

from conducting some or all of its operations as well as impose fines.  We may also need to seek new licensing, which could

subject our insurers to additional or new regulations. In addition, if one of our non-U.S. insurers does not receive an annual

renewal of its reciprocal jurisdiction reinsurer status, it will be required to post additional collateral, which will have a

negative effect on us and our financial condition.

Furthermore, as Global Atlantic seeks to expand its business outside of the U.S., it   may become increasingly exposed to

other applicable regulatory regimes in other jurisdictions, which may be extensive, complex and varied.   As a result, any

future overseas expansion of Global Atlantic’s business would subject us to additional regulatory risk, potential litigation, and

increased compliance costs, and creates potential for additional liabilities and penalties.

Insurance regulations are subject to change, and such changes may have a material and adverse impact on our

business, financial condition and results of operations.

Regulators continuously consider changes to insurance regulations. Since insurance regulations apply to many aspects of

an insurer’s business, changes in insurance regulation may have a range of impacts on us. In recent years, state insurance

regulators have undertaken a review of the state-based insurance regulatory framework in the United States to bolster their

ability to address concerns stemming from the increasing usage of offshore reinsurance transactions and expanding

allocations to affiliated assets and alternative assets.  In addition, some state legislatures have considered or enacted laws

that alter, and in many cases increase, state authority to regulate insurance holding companies and insurance and reinsurance

companies.  Regulatory changes have the ability to impact other areas of Global Atlantic’s business as well, including access to

liquidity or ability to write certain products. For example, there has been regulatory scrutiny of insurance companies’ use of

Federal Home Loan Banks for liquidity, as well as of increased issuances of funding agreement backed notes and pension risk

transfer group annuity contracts. We are unable to predict whether, when or in what form and what impact such regulatory

changes will have on our insurance business.

Regulators also continue to propose or adopt sometimes conflicting or overlapping fiduciary rules, best interest standards

and other similar laws and regulations applicable to the sale of retirement and life insurance products, which would generally

require advisers providing investment recommendations to act in the client’s best interest or put the client’s interest ahead of

their own interest.   These new and proposed regulations may fundamentally adversely impact the way in which our insurance

products are marketed and offered by its distribution partners.   Regulators in enforcement actions and private litigants in

litigation could also find it easier to attempt to extend fiduciary status to, or to claim fiduciary or contractual breach by,

advisors who would not be deemed fiduciaries under current regulations.   Such laws and regulations may have a material

adverse impact on our insurance business, including by increasing compliance costs and burdens and restricting our ability to

conduct and grow our insurance business.

Capital regulations applicable to our insurance subsidiaries impose meaningful limitations on our insurance business,

and any changes to them may have a material and adverse impact on our business, financial condition and results of

operations.

Capital regulations applicable to our insurance subsidiaries impose meaningful limitations on our insurance business and

are subject to change.  Insurance companies are subject to minimum capital and surplus requirements that vary by the

jurisdiction where the insurance company is domiciled and are generally subject to change over time.  The capital regimes in

the United States and Bermuda are different, and regulatory actions to address such differences may result in Global Atlantic

needing to hold more capital.  Any failure to meet applicable requirements or minimum statutory capital requirements could

subject Global Atlantic to examination or corrective action by regulators, including limitations on Global Atlantic’s writing

additional business or engaging in finance activities, supervision, receivership or liquidation.  The NAIC has recently adopted

and is currently considering a variety of reforms to its RBC framework, which could increase the capital requirements for our

US insurance subsidiaries.  RBC is impacted by factors beyond Global Atlantic’s control, such as the federal tax rates and

changes the NAIC from time to time makes to factors used in calculating RBC.  A change in the RBC calculation or an increase

in minimum capital requirements may require Global Atlantic to increase its statutory capital levels, which Global Atlantic may

be unable to meet.  In addition, the NAIC has adopted changes related to filing exempt status for certain securities or loans,

which generally allows the use of an NRSRO rating for purposes of capital assessment as opposed to requiring review by the

Securities Valuation Office of the NAIC and continues to consider other changes.  This change may result in, among other

things, the capital charge treatment of any such investment being less favorable, increasing required capital, and uncertainty

with respect to NAIC ratings of such investments.  We cannot predict the likelihood of changes to the capital requirements to

which Global Atlantic is subject, whether such changes will have an impact on RBC ratios, or whether Global Atlantic will need

to raise and hold additional capital in response to such changes and any such changes may have a material adverse effect on

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us.  Moreover, the determination of RBC is based on the NAIC designation of the assets in which Global Atlantic invests.  NAIC

designation for certain investments depends on the applicable NRSRO rating.  If there are changes in an NRSRO’s

methodology, that impacts the rating of a certain type of asset or changes or clarifications to interpretations of such

methodology or related statutory accounting guidance, Global Atlantic’s ability to invest in such assets may be impacted and

Global Atlantic’s investment results may be adversely impacted, or Global Atlantic may need to increase its required capital.

The NAIC has approved Statutory Accounting Principles (“SAP”) for U.S. insurance companies that have been

implemented by the domiciliary states of our U.S. insurance subsidiaries.  The NAIC from time to time considers amendments

to the SAP and is currently considering various amendments that impact investment transactions and actuarial reserve

requirements for reinsurance.

In addition, the NAIC Accounting Practices and Procedures Manual provides that U.S. state insurance departments may

permit insurance companies domiciled therein to depart from the SAP by granting them permitted accounting practices.

Global Atlantic makes use of permitted practices and may seek approval to use additional permitted practices in the future.

There is a risk that Global Atlantic may not be able to continue to use a previously granted permitted practice.  In addition, we

cannot predict whether or when the insurance departments of the states of domicile of its competitors may permit Global

Atlantic’s competitors to utilize advantageous accounting practices that depart from the SAP, the use of which is not

permitted by the insurance departments of the states of domicile of Global Atlantic’s U.S. insurance subsidiaries.  Any change

in the SAP or permitted practices could have a material adverse impact on Global Atlantic.

The BMA continues to review the Bermuda Solvency Capital Requirements (“BSCR”) on an ongoing basis, including to

maintain its equivalency with Solvency II insurance capital requirements.  In 2023 and 2024, the BMA issued a series of

consultation papers exploring updates to its Economic Balance Sheet (“EBS”) framework (“EBS Framework”), which is used as

the basis to determine an insurer’s enhanced capital requirement, including updated requirements for reserves, capital,

investments and governance.  The BMA has implemented and is in the process of implementing these requirements and could

propose further updates to certain aspects of the EBS Framework.  If any such updates materially increase the ECR, it could

materially increase the amount of capital Global Atlantic is required to hold to meet its BSCR and BMA requirements.

Changes to SAP, the EBS Framework or capital models may be complex, require significant resources to implement and

have an impact on our controls, which may be significant.  Failure to implement or take appropriate or effective management

actions in response to such changes may have a material adverse impact on us.  We can give no assurances that the impacts

of current, proposed or future changes to SAP, EBS Framework, capital models or any components or interpretation thereof,

the grant of permitted accounting practices to Global Atlantic’s competitors or future changes to legal, accounting, capital or

financial regimes will not have a negative impact or material adverse effect on us.

Our Bermuda insurance business is subject to additional regulatory and reputational considerations, which if we do not

properly manage may have a material and adverse impact on our business, financial condition and results of

operations.

The Bermuda insurance and reinsurance regulatory framework is subject to scrutiny from many jurisdictions.  As a result

of such scrutiny, the BMA has implemented and imposed additional requirements on the licensed insurance companies it

regulates to achieve equivalence under Solvency II, the solvency regime applicable to the EU insurance sector.  The BMA’s

additional requirements resulting from Solvency II equivalence include enhanced solvency and governance requirements

imposed on commercial insurers and reinsurers, including a group solvency framework that could further enhance the

required capital and solvency requirements if the BMA is deemed to be the group regulator.  If Solvency II were amended in

any way, Bermuda may be required to amend its regulatory regime to maintain its equivalence under Solvency II, which could

lead to changes in the regulatory regime administered by the BMA.

We cannot provide any assurances that insurance supervisors in the United States or elsewhere will not review Global

Atlantic’s activities and assert that our Bermuda insurance subsidiaries are subject to a U.S. jurisdiction’s requirements.  In

addition, our Bermuda insurance subsidiaries’ ability to write reinsurance may be subject, in certain cases, to arrangements

satisfactory to applicable supervisory bodies, as well as other indirect regulatory requirements.  Regulatory scrutiny or

proposed legislation and regulations may have the effect of imposing additional requirements upon, or restricting reinsurance

from, U.S. insurers to non-U.S. insurers, particularly between affiliated insurance companies.  Reinsurance between our U.S.

and Bermuda insurance subsidiaries is subject to approval by the applicable U.S. domiciliary state insurance department, and

there can be no guarantee such approval will be obtained.  Our insurance business could be significantly and negatively

impacted if Global Atlantic had to recapture any reinsured business. If Global Atlantic attempts to license its Bermuda

insurance entities or its sponsored co-investment vehicles that provide third-party capital to support Global Atlantic’s

business in another jurisdiction, Global Atlantic may not be successful in such attempts and the modification of the conduct of

its business or the noncompliance with insurance statutes and regulations could significantly and negatively affect our

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insurance business.  See also “—Risks Related to Regulatory Matters—Changes in the regulatory framework applicable to our

business, including the loss of exemptions or the application of enhanced group-level regulation, may materially adversely

affect us”.

If our insurance business fails to mitigate the reserve strain associated with statutory accounting rules,

it may result in a material adverse impact on our insurance subsidiaries’ capital positions or require

increasing prices or reducing sales of certain insurance products.

The application of certain statutory accounting rules for term life insurance policies with long-term premium guarantees

and universal life policies with secondary guarantees requires Global Atlantic to maintain reserves at a level that exceeds what

our insurance subsidiaries’ actuarial assumptions for the applicable business would otherwise require.  Global Atlantic has

special purpose financial captive insurance company subsidiaries (“captives”) that facilitate the financing of the redundant

reserve requirements associated with these statutory accounting rules.  These arrangements are subject to review by U.S.

state insurance regulators and rating agencies.

It is unclear what additional actions and regulatory changes will result from the continued scrutiny of captive reinsurers

and reform efforts by the NAIC and other regulatory bodies.  The NAIC is evaluating changes to accounting rules regarding

surplus notes with linked assets, a structure used in certain captive reserve financing transactions.  Further changes in such

statutory accounting rules will likely make it difficult for Global Atlantic to establish new captive financing arrangements on a

basis consistent with its current captives.  As a result, the implementation of new captive structures in the future may be less

capital-efficient, may lead to lower product returns or increased product pricing, or may result in reduced sales of certain

products.

Certain of the reserve financing facilities Global Atlantic has put in place will mature prior to the run-off of the liabilities

they support.  As a result, Global Atlantic may be unable to implement actions to mitigate the strain of having redundant

reserves or to maintain collateral support for its captives or existing third-party reinsurance arrangements to which one of our

captive reinsurance subsidiaries is a party.  If Global Atlantic is unable to continue to implement those actions or maintain

existing collateral support, it may be required to increase statutory reserves, incur higher operating costs or tax costs, and the

competitiveness, capital and financial position and results of operations of our insurance business may be materially and

adversely affected.

Risks Related to Our Organizational Structure

Until the Sunset Date, the Series I preferred stockholder’s significant voting power limits the ability of

holders of our common stock to influence our business, and conflicts of interest may arise among the

Series I preferred stockholder and the holders of our common stock.

The Series I preferred stockholder has significant voting power until the Sunset Date, which limits the ability of holders of

our common stock to influence our business.  Our Co-Executive Chairmen, when acting together, jointly control the Series I

preferred stockholder and thereby the vote of the Series I preferred stock held by it.

Until the Sunset Date, the Series I preferred stockholder has the ability to appoint and remove members of our board of

directors and has the right to approve certain corporate actions as specified in our certificate of incorporation.  If the holders

of our common stock are dissatisfied with the performance of our board of directors, they have no ability to remove any of

our directors, with or without cause, until after the Sunset Date.  Through the Series I preferred stockholder’s ability to elect

our board of directors and its approval rights over certain corporate transactions, the Series I preferred stockholder may be

deemed to control our business and affairs. Prior to the Sunset Date, the vote of the Series I preferred stockholder will

determine the outcome of all matters subject to a vote by our stockholders, except with respect to certain matters

enumerated in our certificate of incorporation as requiring a vote of our common stockholders or as required under NYSE

rules.

Our certificate of incorporation and bylaws also include limitations on the calling of meetings of the stockholders and

procedures for submitting proposals for business to be considered at meetings of the stockholders.  In addition, any person

that beneficially acquires 20% or more of any class of stock then outstanding without the consent of our board of directors

(other than the Series I preferred stockholder) is unable to vote such stock on any matter submitted to such stockholders.

In addition, although the affirmative vote of a majority of our directors is required for any action to be taken by our board

of directors, certain actions that are specified in our certificate of incorporation will also require the approval of the Series I

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preferred stockholder. Accordingly, our board of directors may be prevented from causing us to take certain actions if the

Series I preferred stockholder does not provide its approval to any such action, even if the board of directors believes such

action may be in the best interest of us and our stockholders.

By the Sunset Date, we agreed in the Reorganization Agreement to (i) eliminate our Series I preferred stock and (ii)

establish voting rights for our common stock on a one vote per share basis for all matters subject to a common stockholders’

vote under Delaware corporate law, including with respect to the election of directors.  For more information about the

transactions contemplated by the Reorganization Agreement, see Note 1 “Organization—Reorganization Agreement” in our

financial statements.  For a more detailed description of our common stock and Series I Preferred Stock, see “Description of

Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934,” which is filed as an exhibit to this report.

As a “controlled company,” we qualify for some exemptions from the corporate governance and other

requirements of the NYSE and are not required to comply with certain provisions of U.S. securities

laws.

Prior to the Sunset Date, we are a “controlled company” within the meaning of the corporate governance standards of

the NYSE.  As a “controlled company” we have currently elected not to comply with certain corporate governance

requirements of the NYSE, including the requirements: (i) that the listed company have a nominating and corporate

governance committee that is composed entirely of independent directors, (ii) that the listed company have a compensation

committee that is composed entirely of independent directors and (iii) that the compensation committee be required to

consider certain independence factors when engaging compensation consultants, legal counsel and other committee advisers.

Accordingly, holders of our common stock do not currently have the same protections afforded to stockholders of companies

that are subject to all of the corporate governance requirements of the NYSE.

Following the Sunset Date, including after any applicable transition period for compliance with NYSE rules, we will no

longer be exempted from the foregoing corporate governance requirements of the NYSE.

Our certificate of incorporation states that the Series I preferred stockholder is under no obligation to

consider the separate interests of the other stockholders and contains provisions limiting the liability of

the Series I preferred stockholder.

Our certificate of incorporation contains provisions stating that the Series I preferred stockholder is under no obligation

to consider the separate interests of the other stockholders in its decisions and shall not be liable to the other stockholders

for damages or equitable relief for any losses, liabilities or benefits not derived by such stockholders in connection with such

decisions, unless there has been a final and non-appealable judgment by a court of competent jurisdiction determining that

the Series I preferred stockholder or its officers and directors acted in bad faith or engaged in fraud or willful misconduct.

These provisions restrict the remedies available to stockholders with respect to actions of the Series I preferred stockholder.

In addition, we have agreed to indemnify the Series I preferred stockholder and its affiliates and any member, partner,

tax matters partner (as defined in Code as in effect prior to 2018), partnership representative (as defined in the Code), officer,

director, employee, agent, fiduciary or trustee of any of KKR or its subsidiaries (which includes KKR Group Partnership), the

Series I preferred stockholder or any of our or the Series I preferred stockholder’s affiliates and certain other indemnitees, to

the fullest extent permitted by law, against any and all losses, claims, damages, liabilities, joint or several, expenses (including

legal fees and expenses), judgments, fines, penalties, interest, settlements or other amounts incurred by any such

indemnitee, including in connection with criminal proceedings.  We have agreed to provide this indemnification unless there

has been a final and non-appealable judgment by a court of competent jurisdiction determining that such indemnitee acted in

bad faith or engaged in fraud or willful misconduct.

The provision of our certificate of incorporation requiring exclusive venue in the state and federal

courts located in the State of Delaware or federal district courts of the United States for certain types

of lawsuits may have the effect of discouraging lawsuits against us and our directors, officers and

stockholders.

Our certificate of incorporation requires that (i) any derivative action, suit or proceeding brought on behalf of KKR, (ii) any

action, suit or proceeding asserting a claim of breach of a fiduciary duty owed by any current or former director, officer,

employee or stockholder of KKR to KKR or KKR’s stockholders, (iii) any action, suit or proceeding asserting a claim arising

pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation or our bylaws or as to

which the Delaware General Corporation Law confers jurisdiction on the Court of Chancery of the State of Delaware or (iv)

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any action, suit or proceeding asserting a claim governed by the internal affairs doctrine may only be brought in the Court of

Chancery of the State of Delaware or, if such court does not have subject matter jurisdiction thereof, the federal district court

located in the State of Delaware.  In addition, the federal district courts of the United States are the exclusive forum for the

resolution of any action, suit or proceeding asserting a cause of action arising under the Securities Act and the Exchange Act.

Our ability to pay periodic dividends to the holders of our common stock as intended is not

guaranteed.

We intend to pay cash dividends on a quarterly basis.  KKR & Co. Inc. is a holding company and has no material assets

other than the KKR Group Partnership Units that we hold indirectly through wholly-owned subsidiaries and has no

independent means of generating income.  The declaration and payment of dividends to our stockholders will be at the sole

discretion of our board of directors, and our dividend policy may be changed at any time.  The declaration and payment of

dividends is subject to legal, contractual and regulatory restrictions on the payment of dividends by us or our subsidiaries, and

such other factors as the board of directors considers relevant.  Our ability to pay dividends is also subject to the availability of

lawful funds therefor as determined in accordance with the Delaware General Corporation Law.  Furthermore, by paying cash

dividends rather than investing that cash in our businesses, we risk slowing the pace of our growth, or not having a sufficient

amount of cash to fund our operations, new investments or unanticipated capital expenditures, should the need arise.

If we were deemed to be an “investment company” subject to regulation under the Investment

Company Act, applicable restrictions could make it impractical for us to continue our business as

contemplated and could have a material adverse effect on our business.

We are engaged primarily in the business of providing investment management services and an insurance business, and

not in the business of investing, reinvesting or trading in securities.  Accordingly, we do not believe that we are an “orthodox”

investment company as defined in the Investment Company Act.

In addition, although KKR & Co. Inc. has no material assets other than its indirect ownership of wholly-owned subsidiaries

that in turn own interests in KKR Group Partnership, we do not believe our equity interests in our subsidiaries are investment

securities, and we believe that the capital interests of the general partners of our investment vehicles in their respective

investment vehicles are neither securities nor investment securities.  Moreover, we expect that in excess of 65% of Global

Atlantic’s gross income will be derived from our insurance business.

However, a person will generally be deemed to be an investment company for purposes of the Investment Company Act

if (1) it is or holds itself out as being engaged primarily, or proposes to engage primarily, in the business of investing,

reinvesting or trading in securities, or (2) absent an applicable exemption, it owns or proposes to acquire investment

securities having a value exceeding 40% of the value of its total assets (exclusive of U.S. government securities and cash items)

on an unconsolidated basis.  If we, or any of our operating subsidiaries, were to be deemed to an investment company under

the Investment Company Act, then we could experience a material adverse effect.  Among other things, the Investment

Company Act and the rules and regulations thereunder limit or prohibit transactions with affiliates, impose limitations on the

issuance of debt and equity securities, generally prohibit the issuance of options and impose certain governance

requirements.  If anything were to happen that would cause us to be deemed to be an investment company under the

Investment Company Act, requirements imposed by the Investment Company Act, including limitations on our capital

structure, ability to transact business with affiliates and ability to compensate key employees, would make it impractical for

us to continue our business as currently conducted, impair the agreements and arrangements between and among us, and

materially and adversely affect us.  In addition, we may be required to limit the amount of investments that we make as a

principal, potentially divest of our investments or otherwise conduct our business in a manner that does not subject us to the

registration and other requirements of the Investment Company Act.

Our certificate of incorporation provides that if we are subjected to registration under the provisions of the Investment

Company Act, we may exercise our right to call and purchase all of the then outstanding shares of common stock held by

persons other than the Series I preferred stockholder or its affiliates or assign this right to the Series I preferred stockholder or

any of its affiliates.

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Actions taken to implement the reorganization transactions that must occur by the Sunset Date as part

of the integrated transactions committed to in the Reorganization Agreement may adversely impact

Pursuant to the Reorganization Agreement, we committed to undertake a series of integrated transactions, some of

which were completed in May 2022, and some of which must be completed by the Sunset Date, which will occur not later

than December 31, 2026, whereby our Series I preferred stock will be eliminated.  Actions taken to implement the remaining

structural and governance changes required by the Reorganization Agreement by the Sunset Date could be disruptive to our

management, our business or operations, result in significant costs and expenses, fail to receive regulatory approvals, and

may not be successful in achieving their objectives and fail to result in the intended or expected benefits, any of which could

materially and adversely impact us.  For a description of the rights of our Series I preferred stock see “—Until the Sunset Date,

the Series I preferred stockholder’s significant voting power limits the ability of holders of our common stock to influence our

business, and conflicts of interest may arise among the Series I preferred stockholder and the holders of our common stock”

and for more information about the Reorganization Agreement, see “Note 1 “Organization—Reorganization Agreement” in

our financial statements.

Anti-takeover provisions in our organizational documents may delay or prevent a change of control.

In addition to the provisions related to our Series I preferred stock and Series I preferred stockholder described in this

report, certain provisions in our certificate of incorporation and bylaws may discourage, delay or prevent a merger or

acquisition that a stockholder may consider favorable by, for example:

• permitting our board of directors to issue one or more series of preferred stock;

• requiring advance notice for stockholder proposals and nominations if at any time stockholders other than the Series

I preferred stockholder are permitted to submit proposals and nominations;

• restricting the ability of any stockholder other than the Series I preferred stockholder that acquires 20% or more of

any class of stock then outstanding to vote such stock without the consent of our board of directors; and

• placing limitations on convening stockholder meetings.

These provisions may also discourage acquisition proposals or delay or prevent a change in control.

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with the consolidated financial statements of KKR &

Co. Inc., together with its consolidated subsidiaries, and the related notes included elsewhere in this report. In addition, this

discussion and analysis contains forward-looking statements and involves numerous risks and uncertainties, including those

described under "Cautionary Note Regarding Forward-looking Statements" and "Risk Factors." Actual results may differ

materially from those contained in any forward-looking statements.

Business Environment

Our asset management, insurance, and strategic holdings segments are affected by the various market and economic

conditions of the various countries and regions in which we operate. Market and economic conditions are expected to

continue to have a substantial impact on our financial condition, results of operations, and our business in various ways that

we are unable to control, including our ability to make new investments, the valuations of the investments we manage, the

amount of investment proceeds we realize when we exit our investments, the timing for such realization activity, our ability to

fundraise or to sell our various investment and insurance products and services, and the level of our capital markets activities,

as discussed in the "Risk Factors" section of this report.

In 2025, the United States continued to experience economic growth while also continuing to experience inflation in

excess of the U.S. Federal Reserve Board’s 2.0% target rate. The U.S. Federal Reserve Board lowered the target range for the

federal funds rate three times in 2025, including two reductions in the fourth quarter, that brought the target range to

3.50-3.75%. The U.S. Federal Reserve Board in connection with its fourth quarter rate reductions noted that the reduction was

in response to the slowdown in the labor market; however, they maintained a cautious stance as inflation remained

somewhat elevated and above its long-run target.

Real gross domestic product (“GDP”) growth in the Eurozone in 2025 was moderately positive. The European Central

Bank lowered the deposit rate four times in the first half of 2025 to 2.00% as part of a broader easing cycle in response to

downward revisions to inflation expectations. The European Central Bank subsequently held the deposit rate unchanged for

the remainder of 2025 as Eurozone core inflation slowed compared to 2024 and remained close to the European Central

Bank’s 2% medium-term target.

In Asia, Japan’s economy reaccelerated in 2025, supported by resilient exports and consumer spending. The Bank of

Japan continued its gradual monetary policy normalization during 2025, including an increase in its policy rate from 0.25% to

0.75%. In China, the economy grew in 2025 but continued to face significant headwinds, including weak domestic demand,

ongoing contraction in the property sector, and uncertainty relating to ongoing trade tensions with the United States as

discussed further below.

Several key economic indicators in the United States and in other countries and regions in which we operate include:

• GDP. In the United States, real GDP expanded by 2.2% for the year ended December 31, 2025, compared to an

expansion of 2.8% for the year ended December 31, 2024. Eurozone real GDP is estimated to have expanded by 1.4%

for the year ended December 31, 2025, up from 0.9% expansion for the year ended December 31, 2024. In Japan,

real GDP expanded by 1.1% for the year ended December 31, 2025, up from a 0.2% contraction for the year ended

December 31, 2024. Real GDP in China expanded 5.0% for the year ended December 31, 2025, unchanged from 5.0%

growth reported for the year ended December 31, 2024

• Interest Rates. The target federal funds rate set by the U.S. Federal Reserve Board was 3.625% as of December 31,

2025, down from 4.375% as of December 31, 2024. The benchmark short-term interest rate set by the European

Central Bank was 2.0% as of December 31, 2025, down from 3.00% as of December 31, 2024. The benchmark short-

term interest rate set by the Bank of Japan was 0.75% as of December 31, 2025, up from 0.25% as of December 31,

2024. The benchmark interest rate set by The People’s Bank of China was 3.0% as of December 31, 2025, down from

3.10% as of December 31, 2024.

• Inflation. The U.S. core consumer price index rose 2.6% on a year-over-year basis as of December 31, 2025, down

from 3.2% on a year-over-year basis as of December 31, 2024. Eurozone core inflation was 2.3% as of December 31,

2025, down from 2.7% as of December 31, 2024. In Japan, core inflation rose 1.5% on a year-over-year basis as of

December 31, 2025, down from 1.6% on a year-over-year basis as of December 31, 2024. Core inflation in China was

1.2% on a year-over-year basis as of December 31, 2025, up from 0.4% as of December 31, 2024.

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• Unemployment. The U.S. unemployment rate was 4.4% as of December 31, 2025, up from 4.1% as of December 31,

2024. Eurozone unemployment was 6.3% as of December 31, 2025, unchanged from 6.3% as of December 31, 2024.

The unemployment rate in Japan was 2.6% as of December 31, 2025, up from 2.5% as of December 31, 2024. The

unemployment rate in China was 5.2% as of December 31, 2025, substantially unchanged from 5.1% as of December

In 2025, the United States equity markets appreciated on a year-over-year basis, with varying volatility throughout the

year, and the U.S. 10-year benchmark treasury yield also fluctuated throughout the year to end at a rate lower at year-end

than at the prior year-end of 2024. Short term interest rates fell as the Federal Reserve lowered benchmark interest rates.

European, Japanese and Chinese equity markets all appreciated on a year-over-year basis.

Several key financial market indicators in the United States and in other countries and regions in which we operate

include:

• Equity Markets. For the year ended December 31, 2025, the S&P 500 was up 17.9%, the MSCI Europe Index was up

36.3%, the MSCI Asia Pacific Index was up 28.7% and the MSCI World Index was up 21.6% in U.S. dollar terms, on a

total return basis including dividends. Equity market volatility as evidenced by the Chicago Board Options Exchange

Market Volatility Index (VIX), a measure of volatility, ended at 15.0 as of December 31, 2025, decreasing from 17.4 as

of December 31, 2024.

• Credit Markets. During the year ended December 31, 2025, U.S. investment grade corporate bond spreads (BofA

Merrill Lynch US Corporate Index) tightened by 3 basis points. The non-investment grade credit indices were up

during the year ended December 31, 2025, with the S&P/LSTA Leveraged Loan Index up 5.9% and the BofAML HY

Master II Index up 8.5%. During the year ended December 31, 2025, the 10-year government bond yields fell 40 basis

points in the United States, rose 49 basis points in Germany, rose 97 basis points in Japan, fell 9 basis points in the

UK, and rose 18 basis points in China.

• Commodity Markets. During the year ended December 31, 2025, the 3-year forward price of WTI crude oil decreased

approximately 7.6%, and the 3-year forward price of natural gas decreased from approximately $4.62 per MMBtu as

of December 31, 2024 to $4.51 per MMBtu as of December 31, 2025. The Japan spot LNG import price decreased to

approximately $11.03 per MMBtu as of December 31, 2025, from approximately $13.82 per MMBtu as of December

• Foreign Exchange Rates. For the year ended December 31, 2025, the euro rose 13.4%, the British pound rose 7.7%,

the Japanese yen rose 0.3%, and the Chinese renminbi rose 4.5%, respectively, relative to the U.S. dollar.

Beginning in March 2025 and continuing through the date of the filing of this report, the United States and countries

around the world have experienced elevated levels of market volatility and uncertainty driven by, among other things,

geopolitical and global trade concerns, including, the imposition of tariffs and threats of tariffs by the United States on certain

of its trading partners since April 2025. This volatility and uncertainty adds to the various risks and uncertainties in the

business environment in which we operate and may have various impacts, including on the valuations of certain of our and

our investment vehicles' investments, the pace and volume of our capital market transactions, deployments, and realizations,

and our fundraising activities.

Other Trends, Uncertainties and Risks Related to Our Business

Please refer to the "Risk Factors" section of this report for important additional detail regarding risks, uncertainties, and

other conditions that could have a material favorable or unfavorable impact on our businesses, including the impact of market

and economic conditions on valuations of investments and the impact of competition we face. These risks, uncertainties, and

other conditions should be read in conjunction with this Business Environment section and the entire Risk Factor section of

this report. In particular, see "Risk Factors—Risks Related to Our Business—Global, regional and local events outside of our

control, including geopolitical events and natural disasters, could materially and adversely impact KKR”, “Risk Factors—Risks

Related to Our Investment Activities—Various conditions and events outside of our control that are difficult to quantify or

predict may have a significant impact on the valuation of our investments”, and "Risk Factors—Risks Related to Our Business

—We operate in a highly competitive industry."

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Basis of Accounting and Key Financial Measures under GAAP

We manage our business using certain financial measures and key operating metrics since we believe these metrics

measure the productivity of our operating activities. We prepare our consolidated financial statements in accordance with

accounting principles generally accepted in the United States of America (“GAAP”). See Note 2 “ Summary of Significant

Accounting Policies” in our financial statements and “—Critical Accounting Policies and Estimates” contained in this section

below. Our key Segment and non-GAAP financial measures and operating metrics are discussed below.

Key Segment and Non-GAAP Performance Measures

The following key segment and non-GAAP performance measures are used by management in making operational and

resource deployment decisions as well as assessing the performance of KKR's business. They include certain financial

measures that are calculated and presented using methodologies other than in accordance with GAAP. These performance

measures as described below are presented prior to giving effect to the allocation of income (loss) between KKR & Co. Inc.

and holders of exchangeable securities and as such represent the entire KKR business in total. In addition, these performance

measures are presented without giving effect to the consolidation of certain investment funds and collateralized financing

entities ("CFEs") that KKR manages.

We believe that providing these segment and non-GAAP performance measures on a supplemental basis to our GAAP

results is helpful to stockholders in assessing the overall performance of KKR's business. These non-GAAP measures should

not be considered as a substitute for financial measures calculated in accordance with GAAP. Reconciliations of these non-

GAAP measures to the most directly comparable financial measures calculated and presented in accordance with GAAP,

where applicable, are included under "—Segment Balance Sheet Measures—Reconciliations to GAAP Measures."

Adjusted Net Income

Adjusted Net Income ("ANI") is a performance measure of KKR’s earnings, which is derived from KKR’s reported segment

results. ANI is used to assess the performance of KKR’s business operations and measures the earnings potentially available

for distribution to its equity holders or reinvestment into its business . ANI is equal to Total Segment Earnings less Interest

Expense, Net and Other and Income Taxes on Adjusted Earnings. Interest Expense, Net and Other includes (i) interest expense

on debt obligations not attributable to any particular segment and (ii) cumulative dividend expense on the Series D

Mandatory Convertible Preferred Stock, net of interest income earned on cash and short-term investments. Income Taxes on

Adjusted Earnings represents the amount of income taxes that would be paid assuming that all adjusted earnings were

allocated to KKR & Co. Inc. and taxed at the same effective rate, which assumes that all securities exchangeable into shares of

common stock of KKR & Co. Inc. were exchanged. The economic assumptions and methodologies that impact Income taxes on

Adjusted Earnings are similar to those used in calculating the current income tax provision under U.S. GAAP. Equity based

compensation expense is excluded from ANI, because (i) KKR believes that the cost of equity awards granted to employees

does not contribute to the earnings potentially available for distributions to its equity holders or reinvestment into its

business and (ii) excluding this expense makes KKR’s reporting metric more comparable to the corresponding metric

presented by other publicly traded companies in KKR’s industry, which KKR believes enhances an investor’s ability to compare

KKR’s performance to these other companies. Income Taxes on Adjusted Earnings includes the benefit of tax deductions

arising from equity-based compensation, which reduces Income Taxes on Adjusted Earnings during the period. If tax

deductions from equity-based compensation were to be excluded from Income Taxes on Adjusted Earnings, KKR’s ANI would

be lower and KKR’s effective tax rate would appear to be higher, even though a lower amount of income taxes would have

actually been paid or payable during the period. KKR separately discloses the amount of tax deduction from equity-based

compensation for the period reported and the effect of its inclusion in ANI for the period. KKR makes these adjustments when

calculating ANI in order to more accurately reflect the net realized earnings that are expected to be or become available for

distribution to KKR’s equity holders or reinvestment into KKR’s business. However, ANI does not represent and is not used to

calculate actual dividends under KKR’s dividend policy, which is a fixed amount per period, and ANI should not be viewed as a

measure of KKR’s liquidity.

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Total Segment Earnings

Total Segment Earnings is a performance measure that KKR believes is useful to stockholders as it provides a

supplemental measure of our operating performance without taking into account items that KKR does not believe arise from

or relate directly to KKR's operations. Total Segment Earnings excludes: (i) equity-based compensation charges, (ii)

amortization of acquired intangibles, and (iii) transaction-related and non-operating items, if any. Transaction-related and

non-operating items primarily arise from corporate actions, which consist of: (i) impairments, (ii) transaction costs from

acquisitions, including any acquisition-related stock consideration, (iii) depreciation on real estate that KKR owns and

occupies, (iv) contingent liabilities, net of any recoveries, (v) certain integration, restructuring, and other non-operating

expenses, and (vi) other gains or charges that affect period-to-period comparability and are not reflective of KKR's ongoing

operational performance. Inter-segment transactions are not eliminated from segment results when management considers

those transactions in assessing the results of the respective segments. These transactions include (i) management fees earned

by our Asset Management segment as the investment adviser for Global Atlantic insurance companies, (ii) management and

performance fees earned by our Asset Management segment for acquiring and managing the companies included in our

Strategic Holdings segment, and (iii) interest income and expense based on lending arrangements where our Asset

Management segment borrows from our Insurance segment. All these inter-segment transactions are recorded by each

segment based on the applicable governing agreements. Additionally, due to the integrated nature of our segment operations

and as part of our strategic capital allocation decisions, inter-segment asset transfers have and may continue to occur. In

these cases in segment reporting, the assets are transferred at their fair value, and no realization is recognized at the time of

transfer. Earnings are recognized upon realization events and transactions with third parties. Total Segment Earnings

represents the total segment earnings of KKR’s Asset Management, Insurance and Strategic Holdings segments.

Asset Management Segment Earnings

Asset management segment earnings is the segment profitability measure used to make operating decisions and to

assess the performance of the Asset Management segment. This measure is presented before income taxes and is comprised

of: (i) Fee Related Earnings, (ii) Realized Performance Income, (iii) Realized Performance Income Compensation, (iv) Realized

Investment Income, and (v) Realized Investment Income Compensation. Asset Management Segment Earnings excludes the

impact of: (i) unrealized gains (losses) on investments, (ii) unrealized carried interest, and (iii) unrealized carried interest

compensation. Management fees earned by KKR as the adviser, manager or sponsor for its investment funds, vehicles and

accounts, including its Global Atlantic insurance companies and Strategic Holdings segment, are included in Asset

Management Segment Earnings.

Insurance Operating Earnings

Insurance Operating Earnings is the segment profitability measure used to make operating decisions and to assess the

performance of the Insurance segment. This measure is presented before income taxes and is comprised of: (i) Net

Investment Income, (ii) Net Cost of Insurance, and (iii) General, Administrative, and Other Expenses. Insurance Operating

Earnings excludes the impact of: (i) investment gains (losses) which include realized gains (losses) related to asset/liability

matching investment strategies and unrealized investment gains (losses) and (ii) non-operating changes in policy liabilities and

derivatives which includes (a) changes in the fair value of market risk benefits and other policy liabilities measured at fair

value and related benefit payments, (b) fees attributed to guaranteed benefits, (c) derivatives used to manage the risks

associated with policy liabilities, and (d) losses at contract issuance on payout annuities. Insurance Operating Earnings

includes (i) realized gains and losses not related to asset/liability matching investment strategies and (ii) the investment

management costs that are earned by our Asset Management segment as the investment adviser of the Global Atlantic

insurance companies.

Strategic Holdings Segment Earnings

Strategic Holdings Segment Earnings is the segment profitability measure used to make operating decisions and to assess

the performance of the Strategic Holdings segment. This measure is presented before income taxes and is comprised of:

Dividends, Net and Net Realized Investment Income. Strategic Holdings Segment Earnings excludes the impact of unrealized

gains (losses) on investments. Strategic Holdings Segment Earnings includes management fees and performance fee expenses

that are earned by the Asset Management segment.

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Fee Related Earnings

Fee related earnings is a performance measure used to assess the Asset Management segment’s generation of earnings

from revenues that are measured and received on a more recurring basis as compared to KKR’s investing earnings. KKR

believes this measure is useful to stockholders as it provides additional insight into the profitability of our fee generating asset

management and capital markets businesses. FRE equals (i) Management Fees, including fees paid by the Insurance and

Strategic Holdings segments to the Asset Management segment and fees paid by Ivy vehicles and other reinsurance vehicles,

(ii) Transaction and Monitoring Fees, Net and (iii) Fee Related Performance Revenues, less (x) Fee Related Compensation, and

(y) Other Operating Expenses.

Fee Related Performance Revenues refers to the realized portion of performance fees from certain AUM that has an

indefinite term and for which there is no immediate requirement to return invested capital to investors upon the realization

of investments. Fee related performance revenues consists of performance fees (i) expected to be received from our

investment funds, vehicles and accounts on a recurring basis, and (ii) that are not dependent on a realization event involving

investments held by the investment fund, vehicle or account.

Fee Related Compensation refers to the compensation expense, excluding equity-based compensation, paid from (i)

Management Fees, (ii) Transaction and Monitoring Fees, Net, and (iii) Fee Related Performance Revenues.

Other Operating Expenses represents the sum of (i) occupancy and related charges and (ii) other operating expenses.

Strategic Holdings Operating Earnings

Strategic Holdings Operating Earnings is a performance measure used to assess the firm’s earnings from companies and

businesses reported through its Strategic Holdings segment. Strategic Holdings Operating Earnings currently consists of

earnings derived from dividends that the firm receives from businesses acquired through the firm’s participation in our core

private equity strategy. Strategic Holdings Operating Earnings currently equals dividends less management fees that are

earned by our Asset Management segment. This measure is used by management to assess the Strategic Holdings segment’s

generation of earnings from revenues that are measured and received on a more recurring basis than, and are not dependent

on, realizations from investment activities.

Total Operating Earnings

Total Operating Earnings is a performance measure that represents the sum of (i) FRE, (ii) Insurance Operating Earnings,

and (iii) Strategic Holdings Operating Earnings. KKR believes this measure is useful to stockholders as it provides additional

insight into the profitability of the most recurring forms of earnings from each of KKR’s segments as compared to investing

earnings.

Total Investing Earnings

Total Investing Earnings is a performance measure that represents the sum of (i) Net Realized Performance Income and

(ii) Net Realized Investment Income. KKR believes this measure is useful to stockholders as it provides additional insight into

the earnings of KKR’s segments from the realization of investments.

Total Asset Management Segment Revenues

Total Asset Management Segment Revenues is a performance measure that represents the realized revenues of the Asset

Management segment (which excludes unrealized carried interest and unrealized gains (losses) on investments) and is the

sum of (i) Management Fees, (ii) Transaction and Monitoring Fees, Net, (iii) Fee Related Performance Revenues, (iv) Realized

Performance Income, and (v) Realized Investment Income. Asset Management Segment Revenues excludes Realized

Investment Income earned based on the performance of businesses presented in the Strategic Holdings segment. KKR

believes that this performance measure is useful to stockholders as it provides additional insight into all forms of realized

revenues generated by our Asset Management segment.

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Key Operating and Capital Metrics

Assets Under Management

Assets under management represent the assets managed (including core private equity), advised or sponsored by KKR

from which KKR is entitled to receive management fees or performance income (currently or upon a future event), general

partner capital, and assets managed, advised or sponsored by our strategic BDC partnership and the hedge fund and other

managers in which KKR holds an ownership interest. We believe this measure is useful to stockholders as it provides

additional insight into the capital raising activities of KKR and its hedge fund and other managers and the overall activity in

their investment funds and other managed or sponsored capital. KKR calculates the amount of AUM as of any date as the sum

of: (i) the fair value of the investments of KKR's investment funds and certain co-investment vehicles; (ii) uncalled capital

commitments from these funds, including uncalled capital commitments from which KKR is currently not earning

management fees or performance income; (iii) the asset value of the Global Atlantic insurance companies; (iv) the par value of

outstanding CLOs; (v) KKR's pro rata portion of the AUM of hedge fund and other managers in which KKR holds an ownership

interest; (vi) all of the AUM of KKR's strategic BDC partnership; (vii) the acquisition cost of invested assets of certain non-US

real estate investment trusts and (viii) the value of other assets managed or sponsored by KKR. The pro rata portion of the

AUM of hedge fund and other managers is calculated based on KKR’s percentage ownership interest in such entities

multiplied by such entity’s respective AUM. KKR's definition of AUM (i) is not based on any definition of AUM that may be set

forth in the governing documents of the investment funds, vehicles, accounts or other entities whose capital is included in this

definition, (ii) includes assets for which KKR does not act as an investment adviser, and (iii) is not calculated pursuant to any

regulatory definitions.

Capital Invested

Capital invested is the aggregate amount of capital invested by (i) KKR’s investment funds (including core private equity)

and Global Atlantic insurance companies, (ii) KKR's Principal Activities business line as a co-investment, if any, alongside KKR’s

investment funds, and (iii) KKR's Principal Activities business line in connection with a syndication transaction conducted by

KKR's Capital Markets business line, if any. Capital invested is used as a measure of investment activity at KKR during a given

period. We believe this measure is useful to stockholders as it provides a measure of capital deployment across KKR’s business

lines. Capital invested includes investments made using investment financing arrangements like credit facilities, as applicable.

Capital invested excludes (i) investments in certain leveraged credit strategies, (ii) capital invested by KKR’s Principal Activities

business line that is not a co-investment alongside KKR’s investment funds, and (iii) capital invested by KKR’s Principal

Activities business line that is not invested in connection with a syndication transaction by KKR’s Capital Markets business line.

Capital syndicated by KKR's Capital Markets business line to third parties other than KKR’s investment funds or Principal

Activities business line is not included in capital invested.

Fee Paying AUM

Fee paying AUM represents only the AUM from which KKR is entitled to receive management fees. We believe this

measure is useful to stockholders as it provides additional insight into the capital base upon which KKR earns management

fees. FPAUM is the sum of all of the individual fee bases that are used to calculate management fees and differs from AUM in

the following respects: (i) assets and commitments from which KKR is not entitled to receive a management fee are excluded

(e.g., assets and commitments with respect to which it is entitled to receive only performance income or is otherwise not

currently entitled to receive a management fee) and (ii) certain assets, primarily in its private equity funds, are reflected based

on capital commitments and invested capital as opposed to fair value because fees are not impacted by changes in the fair

value of underlying investments.

Uncalled Commitments

Uncalled commitments is the aggregate amount of unfunded capital commitments that KKR’s investment funds and

carry-paying co-investment vehicles (including core private equity) have received from fund investors to contribute capital to

fund future investments, and the amount of uncalled commitments is not reduced by capital invested using borrowings under

an investment fund’s subscription facility until capital is called from our fund investors. We believe this measure is useful to

stockholders as it provides additional insight into the amount of capital that is available to KKR’s investment funds and carry

paying co-investment vehicles to make future investments. Uncalled commitments are not reduced for investments

completed using fund-level investment financing arrangements or investments we have committed to make but remain

unfunded at the reporting date.

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Analysis of Consolidated Results of Operations (GAAP Basis)

The following is a discussion of our consolidated results of operations on a GAAP basis for the years ended December 31,

2025 and 2024 . You should read this discussion in conjunction with the financial statements and related notes included

elsewhere in this report. For a more detailed discussion of the factors that affected our segment results in these periods, see

"—Analysis of Segment Operating Results." See "Risk Factors" and "—Business Environment" in this report for more

information about risks, uncertainties, and other market and economic conditions that may impact our business, financial

performance, operating results, and valuations. For the discussion comparing our consolidated results of operations on a

GAAP basis for the years ended December 31, 2024 and 2023, see "Part II, Item 7. Management's Discussion and Analysis of

Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the year ended December 31, 2024,

filed with the SEC on February 28, 2025.

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Revenues

Asset Management and Strategic Holdings

Fees and Other

Capital Allocation-Based Income (Loss)

Insurance

Net Premiums

Policy Fees

Net Investment Income

Net Investment-Related Gains (Losses)

Other Income

Total Revenues

Expenses

Asset Management and Strategic Holdings

Compensation and Benefits

Occupancy and Related Charges

General, Administrative and Other

Insurance

Net Policy Benefits and Claims (including market risk benefit (gain)

loss of $312,446 and $(147,790) , respectively; remeasurement

(gain) loss on policy liabilities: $(82,691) and $(74,645) ,

respectively.)

Amortization of Policy Acquisition Costs

Interest Expense

Insurance Expenses

General, Administrative and Other

Total Expenses

Investment Income (Loss) - Asset Management and Strategic

Holdings

Net Gains (Losses) from Investment Activities

Dividend Income

Interest Income

Interest Expense

Total Investment Income (Loss)

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Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Income (Loss) Before Taxes

Income Tax Expense (Benefit)

Net Income (Loss)

Net Income (Loss) Attributable to Redeemable Noncontrolling

Interests

Net Income (Loss) Attributable to Noncontrolling Interests

Net Income (Loss) Attributable to KKR & Co. Inc.

Series D Mandatory Convertible Preferred Stock Dividends

Net Income (Loss) Attributable to KKR & Co. Inc.

Common Stockholders

Consolidated Results of Operations (GAAP Basis) – Asset Management and Strategic

Holdings

Revenues

For the years ended December 31, 2025 and 2024 , revenues consisted of the following:

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Management Fees

Fee Credits

Transaction Fees

Monitoring Fees

Incentive Fees

Expense Reimbursements

Consulting Fees

Total Fees and Other

Carried Interest

General Partner Capital Interest

Total Capital Allocation-Based Income (Loss)

Total Revenues

Fees and Other

Total Fees and Other for the year ended December 31, 2025 , increased compared to the year ended December 31, 2024 ,

primarily as a result of an increase in management fees, which were partially offset by a decrease in Capital Markets

transaction fees.

For a more detailed discussion of the factors that affected our transaction fees during the period, see "—Analysis of Asset

Management Segment Operating Results."

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The increase in management fees was primarily attributable to (i) management fees commencing at North America Fund

XIV in the second quarter of 2025, (ii) management fees commencing at Global Infrastructure Investors V in the third quarter

of 2024 and management fees earned on new capital raised that were retroactive to the start of the fund’s investment period

and (iii) management fees earned on new capital raised over the past twelve months by our private equity and infrastructure

K-Series vehicles. The increase was partially offset by (i) a lower level of management fees earned from Ascendant (our U.S.

middle market traditional private equity fund) due to management fees earned on new capital raised in 2024 that were

retroactive to the start of the fund’s investment period and no such retroactive fees were earned in the current year, (ii) a

decrease in management fees earned from North America Fund XIII as a result of entering its post-investment period in the

second quarter of 2025 and now paying fees based on invested capital rather than committed capital, and (iii) no

management fees earned from Asian Fund II in the current period due to the termination of management fees in the fourth

quarter of 2024.

Management fees due from consolidated investment funds and other investment vehicles are eliminated upon

consolidation under GAAP. However, because these amounts are funded by, and earned from, noncontrolling interests, upon

consolidation under GAAP, KKR's allocated share of the net income from the consolidated investment funds and other

investment vehicles is increased by the amount of fees that are eliminated. Accordingly, net income (loss) attributable to KKR

would be unchanged if such investment funds and other investment vehicles were not consolidated. For a more detailed

discussion on the factors that affect our management fees during the period, see "—Analysis of Asset Management Segment

Operating Results."

Fee credits increased compared to the prior period as a result of (i) a higher level of transaction fees in our Private Equity

business line and (ii) a higher level of monitoring fees in our Private Equity and Real Assets business lines. Fee credits owed to

consolidated investment funds and other investment vehicles are eliminated upon consolidation under GAAP. However,

because these amounts are owed to noncontrolling interests, upon consolidation under GAAP, KKR's allocated share of the

net income from the consolidated investment funds and other investment vehicles is decreased by the amount of fee credits

that are eliminated. Accordingly, net income (loss) attributable to KKR would be unchanged if such investment funds and

other investment vehicles were not consolidated. Transaction and monitoring fees earned from KKR portfolio companies are

not eliminated upon consolidation because those fees are earned from companies which are not consolidated. Furthermore,

transaction fees earned in our capital markets business are not shared with fund investors. Accordingly, certain transaction

fees are reflected in our revenues without a corresponding fee credit.

Capital Allocation-Based Income (Loss)

Capital Allocation-Based Income (Loss) for the year ended December 31, 2025 , was positive primarily due to the net

appreciation of the underlying investments in many of our unconsolidated carry-earning investment vehicles, most notably

North America Fund XIII, Asian Fund IV, and our private equity and infrastructure K-Series vehicles. Capital Allocation-Based

Income (Loss) for the year ended December 31, 2024 , was positive primarily due to the net appreciation of the underlying

investments in many of our unconsolidated carry-earning investment funds, most notably North America Fund XIII, Global

Infrastructure Investors IV, and our private equity and infrastructure K-Series vehicles.

KKR calculates the carried interest that would be due to KKR for each investment fund, pursuant to the fund agreements,

as if the fair value of the underlying investments were realized as of the reporting date, irrespective of whether such amounts

have been realized. Since the fair value of the underlying investments varies between reporting periods, it is necessary to

make adjustments to the amounts recorded as carried interest to reflect either (i) positive performance, resulting in an

increase in the carried interest allocated to the general partner or (ii) negative performance that would cause the amount due

to KKR to be less than the amount previously recognized, resulting in a negative adjustment to carried interest allocated to

the general partner. In each case, it is necessary to calculate the carried interest on cumulative results compared to the

carried interest recorded to date and to make the required positive or negative adjustments.

Investment Income (Loss)

Net Gains (Losses) from Investment Activities for the year ended December 31, 2025

The net gains from investment activities for the year ended December 31, 2025 , were comprised of net realized gains of

$202.9 million and net unrealized gains of $4,598.6 million . See Note 4 "Net Gains (Losses) from Investment Activities – Asset

Management and Strategic Holdings" in our financial statements for detail of realized and unrealized gains and losses from

Investment Activities by asset class.

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Investment gains and losses relating to our general partner capital interest in our unconsolidated funds are not reflected

in our discussion and analysis of Net Gains (Losses) from Investment Activities. Our economics associated with these

investment gains and losses are reflected in Capital Allocation-Based Income (Loss) as described above.

For the year ended December 31, 2025 , net gains (losses) from investment activities were driven primarily by mark-to-

market gains relating to our investment in Exact Holding B.V. (technology sector), USI, Inc. (financial services sector), and IVI-

RMA Global, S.L. (health care sector) held through our consolidated core private equity vehicles. These mark-to-market gains

were partially offset by (i) mark-to-market losses primarily relating to our investment in PetVet Care Centers, LLC (healthcare

sector) held through our consolidated core private equity vehicles, and OneStream, Inc. (NASDAQ: OS) , (ii) mark-to-market

losses on certain foreign exchange forward contracts and (iii) mark-to-market losses on certain investments held in

consolidated CLOs.

Net investment gains (losses) for each asset class are influenced by the valuation methodology applied to each asset, as

well as factors specific to each investment. For the year ended December 31, 2025 , net investment gains (losses) were

primarily generated in the following asset classes:

• Private Equity (including core private equity), which were primarily impacted by overall positive operating

performance of certain portfolio companies. Changes in market multiples varied across regions and sectors used in

the market comparables methodology for the valuation of Level III investments; and

• Real Assets, which primarily benefited from the overall positive operating performance of certain infrastructure

assets. Changes in market multiples varied across regions and sectors used in the market comparables methodology

for the valuation of Level III investments.

See "Risk Factors" and "—Business Environment" in this report for more information about the factors that may impact

our business, financial performance, operating results, and valuation.

Net Gains (Losses) from Investment Activities for the year ended December 31, 2024

The net gains from investment activities for the year ended December 31, 2024 , were comprised of net realized gains of

$246.8 million and net unrealized gains of $3,196.0 million . See Note 4 "Net Gains (Losses) from Investment Activities – Asset

Management and Strategic Holdings" in our financial statements for detail of realized and unrealized gains and losses from

Investment Activities by asset class.

Investment gains and losses relating to our general partner capital interest in our unconsolidated funds are not reflected

in our discussion and analysis of Net Gains (Losses) from Investment Activities. Our economics associated with these

investment gains and losses are reflected in Capital Allocation-Based Income (Loss) as described above.

For the year ended December 31, 2024 , net gains (losses) from investment activities were driven primarily by mark-to-

market gains primarily relating to our investment in USI, Inc., 1-800 Contacts Inc. (healthcare sector), April SA (financial

services sector), and Exact Holding B.V. (technology sector) held through our consolidated core private equity vehicles. These

mark-to-market gains were partially offset by mark-to-market losses primarily relating to our investment in BridgeBio Pharma,

Inc. (NASDAQ: BBIO), PetVet Care Centers, LLC (healthcare sector), and Accell Group N.V. (consumer products sector).

The factors that affect each investment strategy vary depending on the nature of the asset class and the valuation

methodology employed. For the year ended December 31, 2024 , net investment gains (losses) were primarily generated in

the following asset classes:

• Private Equity (including core private equity), which were primarily impacted by (i) overall positive operating

performance of its portfolio companies and (ii) the positive returns of global equity markets and the related increase

of market multiples used in the market comparables methodology for the valuation of Level III investments; and

• Real Assets, which primarily benefited from the positive operating performance of certain infrastructure assets and,

to a lesser extent, by the positive returns of global equity markets and the related increase of market multiples used

in the market comparables methodology for the valuation of Level III investments.

See "Risk Factors" and "—Business Environment" in this report for more information about the factors that may impact

our business, financial performance, operating results, and valuation.

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Dividend Income

During the year ended December 31, 2025 , dividend income was primarily from (i) our investments in 1-800 Contacts Inc.,

Exact Holdings B.V. and April SA, all held through our consolidated core vehicles and (ii) various investments in certain of our

consolidated opportunistic real estate equity funds. During the year ended December 31, 2024 , dividend income was

primarily from (i) our investments in 1-800 Contacts Inc. and Exact Holdings B.V. held through our consolidated core private

equity vehicles, (ii) certain of our consolidated opportunistic real estate equity funds, and (iii) our investment in MásOrange

(telecommunications sector), held through our consolidated European Fund V.

Significant dividends from portfolio companies and consolidated funds are generally not recurring quarterly dividends,

and while they may occur in the future, their size and frequency are variable. For a discussion of other factors that affected

KKR's dividend income, see "—Analysis of Asset Management Segment Operating Results."

Interest Income

The decrease in interest income during the year ended December 31, 2025 , compared to the year ended December 31,

2024 , was primarily due to the impact of lower market interest rates during the current period on floating rate credit

investments held in consolidated CLOs and certain of our consolidated private credit funds. The decrease was partially offset

by the impact of closing CLOs that are consolidated subsequent to December 31, 2024 . For a discussion of other factors that

affected KKR's interest income, see "—Analysis of Asset Management Segment Operating Results."

Interest Expense

The decrease in interest expense during the year ended December 31, 2025 , compared to the year ended December 31,

2024 , was primarily due to the impact of lower market interest rates during the current period on floating rate debt

obligations held in consolidated CLOs and at certain consolidated funds and other investment vehicles. The decrease was

partially offset by (i) the impact of closing CLOs that were consolidated subsequent to December 31, 2024 , and (ii) an increase

in the amount of borrowings outstanding. For a discussion of other factors that affected KKR's interest expense, see "—Key

Segment and Non-GAAP Performance Measures."

Expenses

Compensation and Benefits

The increase in compensation and benefits during the year ended December 31, 2025 , compared to the year ended

December 31, 2024 , was primarily due to a higher level of accrued carried interest compensation driven by a higher level of

carried interest income earned in the current period.

Occupancy and Related Charges

The increase in occupancy and related charges during the year ended December 31, 2025 , compared to the year ended

December 31, 2024 , was primarily due to the commencement of new office leases in the current period.

General, Administrative and Other

The increase in general, administrative and other expenses during the year ended December 31, 2025 , compared to the

year ended December 31, 2024 , was primarily due to a higher level of expenses reimbursable from our  investment funds and

a higher level of corporate general administrative costs, partially offset by a prior year legal accrual that did not recur in the

current period.

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Consolidated Results of Operations (GAAP Basis) – Insurance

Revenues

For the years ended December 31, 2025 and 2024 , revenues consisted of the following:

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Net Premiums

Policy Fees

Net Investment Income

Net Investment-Related Gains (Losses)

Other Income

Total Insurance Revenues

Net Premiums

Net premiums decreased for the year ended December 31, 2025 , as compared to the year ended December 31, 2024 ,

primarily due to a decrease in initial premiums assumed from fewer reinsurance transactions with life contingencies or

morbidity risk during the year ended December 31, 2025 , as compared to the year ended December 31, 2024 . Offsetting

these decreases in part were increases from new premiums earned on direct pension risk transfer and preneed insurance

products with life contingencies or morbidity risk. Initial premiums from new business are generally offset by a comparable

change in policy reserves reported within net policy benefits and claims (as discussed below under “Expenses—Net policy

benefits and claims”).

Net Investment Income

Net investment income increased for the year ended December 31, 2025 , as compared to the year ended December 31,

2024 , primarily due to (i) increased average assets under management due to growth in assets in the institutional and

individual market channels as a result of the cumulative impact of new business volumes in the current and preceding

quarters, and (ii) higher average portfolio yields.

Net Investment-Related Gains (Losses)

The components of net investment-related gains (losses) were as follows:

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Equity Index Options

Interest Rate Contracts

Funds Withheld Payable Embedded Derivatives

Foreign Exchange and Other Derivative Contracts

Equity Futures Contracts

Funds Withheld Receivable Embedded Derivatives

Net Gains (Losses) on Derivative Instruments

Net Other Investment Gains (Losses)

Net Investment-Related Gains (Losses)

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Net Gains (Losses) on Derivative Instruments

The decrease in the fair value of embedded derivatives on funds withheld at interest payable for the year ended

December 31, 2025 was primarily driven by the changes in the fair value of the underlying investments in the funds withheld

at interest payable portfolio, which is primarily comprised of fixed maturity securities (designated as trading for accounting

purposes), mortgage and other loan receivables, and real asset investments. The underlying investments in the funds

withheld at interest payable portfolio increased in value during the year ended December 31, 2025 resulting in a loss on the

related embedded derivative, primarily due to a decrease in market interest rates during the year. In contrast, during the year

ended December 31, 2024 , market interest rates increased, resulting in a decline in the fair value of the underlying

investments and a corresponding gain on the related embedded derivative.

The increase in the fair value of equity index options was primarily driven by the performance of the underlying indices.

Global Atlantic purchases equity index options to hedge the market risk of embedded derivatives in indexed universal life and

fixed-indexed annuity products (the change in which is accounted for in net policy benefits and claims). The majority of Global

Atlantic's equity index options are based on the S&P 500 Index, which increased during both the years ended December 31,

2025 and 2024 , and an increase in the notional amount of equity market contracts outstanding.

The increase in the fair value of interest rate contracts was primarily driven by a decrease in market interest rates during

the year ended December 31, 2025 , as compared to an increase in market interest rates during the year ended December 31,

2024 , resulting in a gain on interest rate contracts for the year ended December 31, 2025 , as compared to a loss on interest

rate contracts for the year ended December 31, 2024 .

The decrease in the fair value of foreign exchange and other derivative contracts was primarily driven by a decrease due

to depreciation of the U.S. dollar against the euro and British pound during the year ended December 31, 2025 .

Net Other Investment-Related Gains (Losses)

The components of net other investment-related gains (losses) were as follows :

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Realized Gains (Losses) on Investments Not Supporting Asset-

Liability Matching Strategies

Realized Gains (Losses) on Available-for-Sale Fixed Maturity

Securities

Credit Loss Allowances

Unrealized Gains (Losses) on Fixed Maturity Securities Classified as

Trading

Unrealized Gains (Losses) on Other Investments Accounted Under

a Fair-Value Option and Equity Investments

Unrealized Gains (Losses) on Real Assets

Realized Gains (Losses) on Real Assets

Realized Gains (Losses) on Funds Withheld at Interest Payable

Portfolio

Realized Gains (Losses) on Funds Withheld at Interest Receivable

Portfolio

Foreign Exchange Gains (Losses) on Non-USD Denominated

Investments

Other

Net Other Investment-Related Gains (Losses)

The decrease in net other investment-related losses for the year ended December 31, 2025 , as compared to the year

ended December 31, 2024 , was primarily due to (i) an increase in unrealized gains on fixed maturity securities classified as

trading, and (ii) an increase in foreign exchange gains on non-U.S. dollar denominated investments due to the greater foreign

exchange volatility as a result of the depreciation of the U.S. dollar against the euro and British pound during the year ended

December 31, 2025 .

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Offsetting these decreases in net other investment-related losses in part was an increase in realized losses on available-

for-sale fixed maturity securities due to portfolio repositioning trades during the year ended December 31, 2025 .

Expenses

Net Policy Benefits and Claims

Net policy benefits and claims decreased for the year ended December 31, 2025 , as compared to the year ended

December 31, 2024 , primarily due to (i) lower initial reserves assumed related to new reinsurance transactions with life

contingencies or morbidity risk in the year ended December 31, 2025 , as compared to the year ended December 31, 2024 , (ii)

favorable impacts related to the assumption review described below, and (iii) the change in the value of embedded

derivatives in Global Atlantic’s fixed indexed annuity products as a result of an increase in equity market gains for the year

ended December 31, 2025 , as compared to the year ended December 31, 2024 (as discussed above under "—Consolidated

Results of Operations (GAAP Basis)—Revenues—Net investment-related gains (losses)". Global Atlantic purchases equity

index options in order to hedge this risk, the fair value changes of which are accounted for in gains (losses) on derivative

instruments, and generally offsets the change in embedded derivative fair value reported in net policy benefits and claims).

These decreases were partially offset by (i) higher average funding costs due to higher crediting rates and the ordinary-

course run-off of older business originated in a low interest rate environment, (ii) new reserves established related to new

business originated with life or morbidity risks associated with preneed insurance and direct pension risk transfer products,

and (iii) an increase in market risk benefits losses due to a decrease in market interest rates for the year ended December 31,

2025 , as compared to an increase in market interest rates for the year ended December 31, 2024 .

The assumptions on which reserves, deferred revenue and expenses are based are intended to represent an estimate of

the benefits that are expected to be payable to, and fees or premiums that are expected to be collectible from, policyholders

in future periods. Global Atlantic reviews the adequacy of its reserves, deferred revenue and expenses, and the assumptions

underlying those items at least annually, usually in the third quarter, referred to as an “assumption review.” As Global Atlantic

analyzes its assumptions, to the extent Global Atlantic chooses to update one or more of those assumptions, there may be an

“unlocking” impact. Generally, favorable unlocking means the change in assumptions required a reduction in reserves, or in

deferred revenue liabilities, and unfavorable unlocking means the change in assumptions required an increase in reserves or

in deferred revenue liabilities, or a reduction in deferred expenses.

For the year ended December 31, 2025 , there was a net favorable assumption review impact of $82.7 million on net

policy benefits and claims, which was primarily due to (i) higher expected yield assumptions for certain interest-sensitive life

products, (ii) favorable expected surrender and persistency assumption changes for certain income annuity, variable annuity,

and life insurance products, and (iii) a decrease in expected morbidity assumptions on long-term care riders for certain fixed

annuity products, offset in part by (i) higher mortality rate assumptions for certain life insurance products, (ii) a change in the

activation assumption related to certain benefit riders on fixed-indexed annuities, and (iii) higher surrender rate assumptions

for certain assumed annuity products.

For the year ended December 31, 2024 , there was a net favorable assumption review impact of $74.6 million on net

policy benefits and claim, which was primarily due to (i) higher assumed mortality rates for guaranteed income riders on

fixed-indexed annuities, and (ii) higher assumed interest rate margins on certain interest-sensitive life products due to an

increase in assumed reinvestment rates and flat crediting rates. These favorable impacts were partially offset by (i) lower

assumed surrender rates on interest-sensitive life products without secondary guarantees, (ii) an increase in the option

budget assumptions for certain fixed-indexed annuities and interest sensitive life products, and (iii) higher surrender rate

assumption for certain assumed flow annuity business.

Amortization of Policy Acquisition Costs

Amortization of policy acquisition costs increased for the year ended December 31, 2025 , as compared to the year ended

December 31, 2024 , primarily due to (i) the remeasurement of the policy liabilities associated with certain cost-of-reinsurance

asset intangibles during the year ended December 31, 2024 , resulting in an increase in the cost-of-reinsurance asset and a

decrease in amortization in the comparative twelve month period, and (ii) an increase in deferred acquisition costs

amortization for the year ended December 31, 2025 associated with the cumulative impact of new business volumes

generated from individual retirement annuities and preneed insurance.

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Interest Expense

Interest expense increased for the year ended December 31, 2025 , as compared to the year ended December 31, 2024 ,

primarily due to an increase in total debt outstanding.

Insurance Expenses

Insurance expenses decreased for the year ended December 31, 2025 , as compared to the year ended December 31,

2024 , primarily due to a decrease in commission expenses as a result of the lower new business volumes in the institutional

markets channel.

General, Administrative and Other

General, administrative and other increased for the year ended December 31, 2025 , as compared to the year ended

December 31, 2024 , primarily due to increased employee compensation expenses, offset in part by a lower level of consulting

and employee augmentation costs.

Other Consolidated Results of Operations (GAAP Basis)

Income Tax Expense (Benefit)

Income tax expense decreased slightly for the year ended December 31, 2025 , as compared to the year ended December

31, 2024 , primarily driven by a lower level of income before tax attributable to KKR common stockholders partially offset by

an increase in state and foreign income taxes. As reported in Note 18 “Income Taxes” KKR’s effective tax rate is 13%. If you

are to exclude the reported net income (loss) before taxes not attributable to KKR common stockholders, KKR’s effective tax

rate would be 24%. For a discussion of factors that impacted KKR's tax provision, see Note 18 "Income Taxes" in our financial

statements included elsewhere in this report.

Net Income (Loss) Attributable to Redeemable Noncontrolling Interests

Net income (loss) attributable to redeemable noncontrolling interests relates primarily to net income (loss) attributable

to third-party limited partner interests in consolidated investment funds and other investment vehicles when the

noncontrolling interests have redemption features that are not solely within the control of KKR. Net income (loss) attributable

to redeemable noncontrolling interests increased for the year ended   December 31, 2025 , as compared to the year ended

December 31, 2024 , primarily due to a higher level of net gains from investment activities at these consolidated investment

funds and other investment vehicles.

Net Income (Loss) Attributable to Noncontrolling Interests

Net income (loss) attributable to noncontrolling interests relates primarily to net income (loss) attributable to (i) non-

redeemable third-party limited partner interests in consolidated investment funds and other investment vehicles and (ii)

exchangeable securities representing ownership interests in KKR Group Partnership until they are exchanged for common

stock of KKR & Co. Inc. Net income (loss) attributable to noncontrolling interests increased for the year ended December 31,

2025 , as compared to the year ended December 31, 2024 , primarily due to a higher level of net gains from investment

activities at our consolidated investment funds and other investment vehicles.

Net Income (Loss) Attributable to KKR & Co. Inc.

Net income (loss) attributable to KKR & Co. Inc. decreased for the year ended December 31, 2025 , as compared to the

year ended December 31, 2024 , primarily due to a higher level of realized investment losses on available-for-sale fixed

maturity securities in our insurance business, which were partially offset by (i) a higher level of capital allocation-based

income from our asset management business, (ii) a higher level of investment-related net gains attributable to KKR & Co. Inc.

from our asset management and strategic holdings operations and (iii) a higher level of asset management fee related income

in the current period.

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Consolidated Statements of Financial Condition (GAAP Basis)

Please see our consolidated statements of financial condition on a GAAP basis as of December 31, 2025 and December

31, 2024 in our financial statements included in this report.

KKR & Co. Inc. Stockholders’ Equity - Common Stock increased from December 31, 2024 primarily due to unrealized gains

on available-for sale-securities from Global Atlantic that are recorded in other comprehensive income and net income

attributable to KKR & Co. Inc. common stockholders, which were partially offset by dividends to common and preferred

stockholders.

Consolidated Statements of Cash Flows (GAAP Basis)

The following is a discussion of our consolidated cash flows for the years ended December 31, 2025 , 2024 , and 2023 . You

should read this discussion in conjunction with the financial statements and related notes included elsewhere in this report.

The consolidated statements of cash flows include the cash flows of our consolidated entities, which include certain

consolidated investment funds, CLOs and certain variable interest entities formed by Global Atlantic notwithstanding the fact

that we may hold only a minority economic interest in those investment funds and CFEs. The assets of our consolidated

investment funds and CFEs, on a gross basis, can be substantially larger than the assets of our business and, accordingly, could

have a substantial effect on the cash flows reflected in our consolidated statements of cash flows. The primary cash flow

activities of our consolidated funds and CFEs involve: (i) capital contributions from fund investors; (ii) using the capital of fund

investors to make investments; (iii) financing certain investments with indebtedness; (iv) generating cash flows through the

realization of investments; and (v) distributing cash flows from the realization of investments to fund investors. Because our

consolidated investment funds are treated as investment companies for accounting purposes, certain of these cash flow

amounts are included in our cash flows from operations.

Net Cash Provided (Used) by Operating Activities

Our net cash provided (used) by operating activities was $0.5 billion , $6.6 billion , and $(1.5) billion during the years ended

December 31, 2025 , 2024 , and 2023 , respectively. Our operating activities primarily included: (i) investments purchased (asset

management and strategic holdings), net of proceeds from investments (asset management and strategic holdings) of

$(9.2) billion , $(0.7) billion , and $(8.6) billion during the years ended December 31, 2025 , 2024 , and 2023 , respectively, (ii) net

realized gains (losses) on investments (asset management and strategic holdings) of $0.2 billion , $0.2 billion , and $(0.8) billion

during the years ended December 31, 2025 , 2024 , and 2023 , respectively, (iii) change in unrealized gains (losses) on

investments (asset management and strategic holdings) of $4.6 billion , $3.2 billion , and $3.8 billion during the years ended

December 31, 2025 , 2024 , and 2023 , respectively, (iv) capital allocation-based income (loss) (asset management and strategic

holdings) of $3.8 billion , $3.6 billion , and $2.8 billion during the years ended December 31, 2025 , 2024 , and 2023 ,

respectively, (v) net investment and policy liability-related gains (losses) (insurance) of $(3.3) billion , $(3.3) billion , and $(2.6)

billion during the years ended December 31, 2025 , 2024 , and 2023 , respectively, and (vi) interest credited to policyholder

account balances (net of policy fees) (insurance) of $5.0 billion , $4.2 billion , and $2.8 billion during the years ended December

31, 2025 , 2024 , and 2023 , respectively. Investment funds are investment companies under GAAP and reflect their

investments and other financial instruments at fair value.

Net Cash Provided (Used) by Investing Activities

Our net cash provided (used) by investing activities was $(16.3) billion , $(19.0) billion , and $(3.9) billion during the years

ended December 31, 2025 , 2024 , and 2023 , respectively. Our investing activities primarily included: (i) investments purchased

(insurance), net of proceeds from investments (insurance), of $(16.0) billion , $(18.9) billion , and $(3.8) billion during the years

ended December 31, 2025 , 2024 , and 2023 , respectively, (ii) acquisitions, net of cash acquired, of $(146.3) million during the

year ended December 31, 2025 , and (iii) the purchase of fixed assets of $(160.8) million , $(141.5) million , and $(108.4) million

during the years ended December 31, 2025 , 2024 , and 2023 , respectively.

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Net Cash Provided (Used) by Financing Activities

Our net cash provided (used) by financing activities was $17.4 billion , $7.1 billion , and $12.8 billion during the years

ended December 31, 2025 , 2024 , and 2023 , respectively. Our financing activities primarily included: (i) contributions from, net

of distributions to, our noncontrolling and redeemable noncontrolling interests of $6.3 billion , $0.1 billion , and $6.4 billion

during the years ended December 31, 2025 , 2024 , and 2023 , respectively, (ii) proceeds received, net of repayment of debt

obligations, of $2.0 billion , $3.5 billion , and $3.6 billion during the years ended December 31, 2025 , 2024 , and 2023 ,

respectively, (iii) proceeds from the issuance of Series D Mandatory Convertible Preferred Stock (net of issuance cost) of

$2.5 billion during the year ended December 31, 2025 , (iv) additions to, net of withdrawals from, contractholder deposit funds

(insurance) of $7.0 billion , $7.9 billion , and $1.9 billion during the years ended December 31, 2025 , 2024 , and 2023 ,

respectively, (v) cash consideration for the 2024 GA Acquisition of $(2.6) billion during the year ended December 31, 2024 , (vi)

reinsurance transactions, net of cash provided (insurance) of $193.6 million , $47.8 million , and $1.2 billion during the years

ended December 31, 2025 , 2024 , and 2023 , respectively, (vii) common stock dividends of $(649.9) million , $(612.1) million ,

and $(563.3) million during the years ended December 31, 2025 , 2024 , and 2023 , respectively, (viii) Series D Mandatory

Convertible Preferred Stock Dividends of $(118.6) million during the year ended December 31, 2025 , and (ix) Series C

Mandatory Convertible Preferred Stock Dividends of $(51.7) million during the year ended December 31, 2023.

Analysis of Segment Operating Results

The following is a discussion of the results of our business on a segment basis for the years ended December 31, 2025 and

2024 . You should read this discussion in conjunction with the information included under "—Analysis of Non-GAAP

Performance Measures" and the financial statements and related notes included elsewhere in this report. See "Risk Factors"

and "—Business Environment" in this report for more information about factors that may impact our business, financial

performance, operating results, and valuations. For the discussion comparing our business on a segment basis for the years

ended December 31, 2024 and 2023, see "Part II, Item 7. Management's Discussion and Analysis of Financial Condition and

Results of Operations" in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on

February 28, 2025.

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Analysis of Asset Management Segment Operating Results

The following tables set forth information regarding KKR's asset management segment operating results for the years

ended December 31, 2025 and 2024 .

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Management Fees

Transaction and Monitoring Fees, Net

Fee Related Performance Revenues

Fee Related Compensation

Other Operating Expenses

Fee Related Earnings

Realized Performance Income

Realized Performance Income Compensation

Realized Investment Income

Realized Investment Income Compensation

Asset Management Segment Earnings

Management Fees

The following table presents management fees by business line:

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Management Fees

Private Equity

Real Assets

Credit and Liquid Strategies

Total Management Fees

The increase in Private Equity management fees was primarily attributable to (i) management fees commencing at North

America Fund XIV in the second quarter of 2025 and (ii) management fees earned on new capital raised over the past twelve

months at our private equity K-Series vehicles, net of certain revenue sharing arrangements. The increase was partially offset

by (i) a lower level of management fees earned from Ascendant (our U.S. middle market traditional private equity fund) due

to management fees earned on new capital raised in 2024 that were retroactive to the start of the fund’s investment period

and no such retroactive fees were earned in the current year, (ii) a decrease in management fees earned from North America

Fund XIII as a result of entering its post-investment period in the second quarter of 2025, and now paying fees based on

invested capital rather than committed capital, and (iii) no management fees earned from Asian Fund II in the current period

due to the termination of management fees in the fourth quarter of 2024. During the three and twelve months ended

December 31, 2025, approximately $12.0 million and $17.0 million, respectively of management fees were earned on new

capital raised that were retroactive to the start of the relevant fund’s investment period. Additionally, in the fourth quarter of

2025 approximately $11.4 million of fees were recognized for providing advisory services to entities in certain fund structures.

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The increase in Real Assets management fees was primarily attributable to (i) management fees commencing at Global

Infrastructure Investors V in the third quarter of 2024, (ii) management fees earned on new capital raised over the past twelve

months at our infrastructure K-Series vehicles, net of certain revenue sharing arrangements, and (iii) a higher level of

management fees earned from Global Atlantic primarily due to the growth in assets from inflows. The increase was partially

offset by a decrease in management fees earned from Global Infrastructure Investors III and Asia Pacific Infrastructure

Investors due to a decrease in invested capital during the current year. During the three and twelve months ended December

31, 2025, approximately $14.3 million and $71.1 million, respectively of management fees were earned on new capital raised

that is retroactive to the start of the relevant fund's investment period. Additionally, in the fourth quarter of 2025

approximately $5.6 million of fees were recognized for providing advisory services to entities in certain fund structures.

The increase in Credit and Liquid Strategies management fees was primarily attributable to (i) a higher level of

management fees earned from Global Atlantic primarily due to the growth in assets from inflows, (ii) an increase in capital

invested in certain alternative credit strategy accounts, which resulted in an increase in its fee base, and (iii) a higher level of

management fees earned from CLOs from new issuances in both the United States and Europe during the year ended

December 31, 2025.

Transaction and Monitoring Fees, Net

The following table presents transaction and monitoring fees, net by business line:

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Transaction and Monitoring Fees, Net

Private Equity

Real Assets

Credit and Liquid Strategies

Capital Markets

Total Transaction and Monitoring Fees, Net

Our Private Equity, Real Assets, and Credit and Liquid Strategies business lines earn transaction and monitoring fees from

portfolio companies, and under the terms of the management agreements with certain of our investment funds, we are

required to share all or a portion of such fees with our fund investors. For most of our investment funds, transaction and

monitoring fees are credited against fund management fees up to 100% of the amount of the transaction and monitoring fees

attributable to that investment fund, which results in a decrease of our monitoring and transaction fees. Our Capital Markets

business line earns transaction fees, which are generally not shared with fund investors.

The decrease in transaction and monitoring fees, net is primarily due to a lower level of transaction fees earned in our

Capital Markets business line. The decrease in capital markets transaction fees was primarily due to a decrease in the size of

capital markets transactions for the year ended December 31, 2025 . Overall, we completed 404 capital markets transactions

for the year ended December 31, 2025 , of which 49 represented equity offerings and 355 represented debt offerings, as

compared to 397 transactions for the year ended December 31, 2024 , of which 56 represented equity offerings and 341

represented debt offerings. We earn fees in connection with underwriting, syndication, and other capital markets services.

While each of the capital markets transactions that we undertake in this business line is separately negotiated, our fee rates

are generally higher with respect to underwriting or syndicating equity offerings than with respect to debt offerings, and the

amount of fees that we earn for similar transactions generally correlates with overall transaction sizes.

Our capital markets fees are generated in connection with activity involving our Private Equity, Real Assets, and Credit

and Liquid Strategies business lines as well as from third-party companies. For the year ended December 31, 2025 ,

approximately 15% of our transaction fees in our Capital Markets business line were earned from unaffiliated third parties as

compared to approximately 13% for the year ended December 31, 2024 . Our transaction fees are comprised of fees earned

from North America, Europe, and the Asia-Pacific region. For the year ended December 31, 2025 , approximately 54% of our

transaction fees were generated outside of North America as compared to approximately 47% for the year ended December

31, 2024 . Our Capital Markets business line is dependent on the overall capital markets environment, which is in fluenced by,

among other things, equity prices, credit spreads, and volatility. Our Capital Markets business line does not generate

monitoring fees.

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Fee Related Performance Revenues

The following table presents fee related performance revenues by business line:

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Fee Related Performance Revenues

Private Equity

Real Assets

Credit and Liquid Strategies

Total Fee Related Performance Revenues

Fee related performance revenues represent performance fees that are (i) expected to be received from our investment

funds, investment vehicles and accounts on a more recurring basis and (ii) not dependent on a realization event involving

investments held by the investment fund, vehicle or account.

The increase in fee related performance revenues for the year ended December 31, 2025 compared to the prior period

was primarily due to a higher level of performance revenues being earned from our infrastructure K-Series vehicles in our Real

Assets business line.

Fee Related Compensation

The increase in fee related compensation for the year ended December 31, 2025 compared to the prior period was

primarily due to a higher level of compensation recorded in connection with the higher level of fee related revenues.

Other Operating Expenses

The increase in other operating expenses for the year ended December 31, 2025 compared to the prior period was

primarily due to a higher level of occupancy related and general and administrative costs.

Fee Related Earnings

The increase in fee related earnings for the year ended December 31, 2025 compared to the prior period was primarily

due to (i) a higher level of management fees across our Private Equity, Real Assets, and Credit and Liquid Strategies business

lines and (ii) a higher level of fee related performance revenues primarily earned in our Real Assets business line, partially

offset by a (i) higher level of fee related compensation and other operating expenses and (ii) a lower level of transaction fees

earned in our Capital Markets business line, as described above.

Realized Performance Income

The following table presents realized performance income by business line:

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Realized Performance Income

Private Equity

Real Assets

Credit and Liquid Strategies

Total Realized Performance Income

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Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Private Equity

Asian Fund IV

Americas Fund XII

Private Equity K-Series

Strategic Investor Partnerships

Core Private Equity Vehicles

Next Generation Technology Growth Fund II

European Fund V

Health Care Strategic Growth Fund

Asian Fund III

Global Impact Fund

Strategic Holdings Segment

Asian Fund II Carried Interest Repayment Obligation

Other

Total Realized Performance Income

Realized performance income in our Private Equity business line for the year ended December 31, 2025 consisted

primarily of (i) realized proceeds from the sale of our investments in Seiyu Group (consumer products sector) held by Asian

Fund IV, ReliaQuest, LLC (technology sector) held by Next Generation Technology Growth Fund II, Integrated Specialty

Services (financial services sector) held by Americas Fund XII, and The Citation Group (services sector) held by both European

Fund V and Global Impact Fund and (ii) performance income from our core private equity vehicles and private equity K-Series

vehicles. Realized performance income in our Private Equity business line was reduced by $344 million as a result of the

repayment of the Asian Fund II clawback obligation in the fourth quarter of 2025. On a net basis, after giving effect to carried

interest distributions already recouped from current and former employees, the clawback obligation reduced fourth quarter

2025 net realized performance income by $207 million.

Realized performance income in our Private Equity business line for the year ended December 31, 2024 consisted

primarily of (i) realized proceeds from the sale of our investments in AppLovin Corporation (NASDAQ: APP) and

GeoStabilization International (industrials sector), both held by Americas Fund XII, and Kokusai Electric Corporation (TYO:

6525) held by Asian Fund III and (ii) performance income from our core private equity vehicles and private equity K-Series

vehicles.

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Real Assets

Global Infrastructure Investors III

Asia Pacific Infrastructure Investors

Global Infrastructure Investors II

Other

Total Realized Performance Income

Realized performance income in our Real Assets business line for the year ended December 31, 2025 consisted primarily

of realized proceeds from the sale of our investments in Pinnacle Towers (infrastructure: telecommunications sector) held by

Asia Pacific Infrastructure Investors, Metronet Holdings, LLC (infrastructure: telecommunications sector), and NEP Renewables

II, LLC (infrastructure: energy and energy transition sector) held by Global Infrastructure Investors III, and Q-Park N.V.

(infrastructure: transportation sector) held by Global Infrastructure Investors II.

Realized performance income in our Real Assets business line for the year ended December 31, 2024 consisted primarily

of realized proceeds from the sale of our investment in FiberCop S.p.A. (infrastructure: telecommunications sector) and

ADNOC Oil Pipelines (infrastructure: midstream sector), both held by Global Infrastructure Investors III.

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Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Credit and Liquid Strategies

Lending Partners III

Strategic Hedge Fund Partnerships and Other

Total Realized Performance Income

Realized performance income in our Credit and Liquid Strategies business line for the year ended December 31, 2025

consisted primarily of (i) performance fees earned from Marshall Wace and (ii) realized proceeds at Lending Partners III.

Realized performance income in our Credit and Liquid Strategies business line for the year ended December 31, 2024

consisted primarily of performance fees earned from Marshall Wace and our sub-advisory agreement with a UK investment

fund manager.

Realized Performance Income Compensation

The increase in realized performance income compensation for the year ended December 31, 2025 compared to the prior

period was primarily due to a higher level of compensation recorded in connection with the higher level of realized

performance income.

Realized Investment Income

The following table presents realized investment income from our Principal Activities business line:

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Total Realized Investment Income

The decrease in realized investment income is primarily due to a lower level of interest income and dividends partially

offset by a higher level of net realized gains. The amount of realized investment income depends on the transaction activity of

our funds and Asset Management segment balance sheet, which can vary from period to period.

For the year ended December 31, 2025 , realized investment income was primarily comprised of (i) realized gains primarily

from the sale of our investments in BridgeBio Pharma, Inc., ReliaQuest, LLC, BrightSpring Health Services (fka Pharmerica)

(NASDAQ: BTSG), and Kokusai Electric Corporation, (ii) realized gains from the settlement of certain foreign exchange forward

contracts, and (iii) interest income primarily from our investments in CLOs. Partially offsetting the realized gains were realized

losses, the most significant of which were (i) a realized loss related to a structured multi-asset investment vehicle and (ii)

realized losses from the sale of various revolving credit facilities by the Capital Markets business line.

For the year ended December 31, 2024, realized investment income was primarily comprised of (i) interest income

primarily from our investments in CLOs and (ii) realized gains primarily from the sale of our investments in AppLovin

Corporation, Kokusai Electric Corporation, BridgeBio Pharma, Inc., and Darktrace Limited (LSE: DARK). Partially offsetting the

realized gains were realized losses, the most significant of which were (i) a realized loss on our alternative credit investment

Selecta Group HoldCo. (consumer products sector), (ii) realized losses from the sale of various revolving credit facilities, (iii) a

realized loss on our infrastructure investment, Indus Towers Limited (NSE: INDUSTOW), and (iv) a realized loss on our private

equity investment, Acteon Group Ltd. (energy sector).

Realized investment income includes the net income (loss) from KKR Capstone. For the year ended December 31, 2025 ,

total fees attributable to KKR Capstone were $113.6 million and total expenses attributable to KKR Capstone were $100.0

million. For KKR Capstone-related adjustments in reconciling segment revenues and expenses to GAAP revenues and expenses

"—See Note 21 “Segment Reporting” in the accompanying financial statements.

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As of the date of this filing, we have transactions that are pending or that have closed after December 31, 2025 that are

expected to result in realized performance income and realized investment income of at least $900 million , which are

expected to be realized in the first half of 2026. See “—Liquidity—Sources of Liquidity” for additional information. Some of

these transactions are not complete, and are subject to the satisfaction of closing conditions, including regulatory approvals;

therefore, there can be no assurance if or when such transactions will be completed. In addition, we may realize gains or

losses based on transactions or other events that occur after the date of filing this report, which could impact, positively or

negatively, the total amount of our realized performance income and realized investment income. Therefore, no assurance

can be given for what our actual realized performance income and realized investment income between the fourth quarter of

2025 and first half of 2026 or future periods will be.

Realized Investment Income Compensation

The decrease in realized investment income compensation for the year ended December 31, 2025 compared to the prior

period is primarily due to a lower level of compensation recorded in connection with the lower level of realized investment

income.

Operating and Capital Metrics

See also “Fund Performance Metrics” for more information about our investment funds, vehicles and accounts across our

Private Equity, Real Assets and Credit and Liquid Strategies business lines, including investment performance, capital

commitments, uncalled capital commitments, and invested capital of each. See also "Risk Factors" and "—Business

Environment" in this report for more information about the factors that may impact our business, financial performance,

operating results and valuations.

The following tables present our key asset management segment operating and capital metrics:

($ in millions)

December 31, 2025

December 31, 2024

Change

Assets Under Management

Fee Paying Assets Under Management

Uncalled Commitments

Years Ended

($ in millions)

December 31, 2025

December 31, 2024

Change

Capital Invested

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Assets Under Management

Private Equity

The following table reflects the changes in the AUM of our Private Equity business line from December 31, 2024 to

December 31, 2025 :

($ in millions)

December 31, 2024

New Capital Raised

Acquisitions (1)

Distributions and Other

Redemptions

Change in Value

December 31, 2025

(1) Reflects the AUM of investment funds sponsored (or managed) by HealthCare Royalty Management, LLC at closing.

AUM of our Private Equity business line was $229.4 billion as of December 31, 2025 , an increase of $34.0 billion,

compared to $195.4 billion as of December 31, 2024 .

The increase was primarily attributable to (i) investment funds sponsored (or managed) by HealthCare Royalty

Management, LLC, which is an alternative asset management firm that we acquired on July 30, 2025, (ii) new capital raised

from North America Fund XIV and our private equity K-Series vehicles, and (iii) appreciation in investment value primarily

from Asian Fund IV, North America Fund XIII, our core private equity strategy and our private equity K-Series vehicles. Partially

offsetting the increases were (i) the release of capital commitments related to one of our strategic investor partnerships with

an insurance client, and (ii) distributions to fund investors primarily as a result of realized proceeds, most notably from Asian

Fund IV, Americas Fund XII and Asian Fund III.

For the year ended December 31, 2025 , the value of our traditional private equity investment portfolio appreciated by

14%. This was comprised of a 16% increase in share prices of publicly held investments and a 14% increase in value of our

privately held investments. For the year ended December 31, 2025 , the value of our growth equity investment portfolio

increased 13%, and the value of our core private equity investment portfolio increased 7%.

Real Assets

The following table reflects the changes in the AUM of our Real Assets business line from December 31, 2024 to

December 31, 2025 :

($ in millions)

December 31, 2024

New Capital Raised

Distributions and Other

Redemptions

Change in Value

December 31, 2025

AUM of our Real Assets business line was $192.5 billion as of December 31, 2025 , an increase of $26.5 billion, compared

to $166.0 billion as of December 31, 2024 .

The increase was primarily attributable to (i) new capital raised from Global Atlantic inflows invested in real estate, our

infrastructure K-Series vehicles, and Global Infrastructure Investors V, and, to a lesser extent, (ii) appreciation in investment

value from Global Infrastructure Investors IV and the Diversified Core Infrastructure Fund. Partially offsetting the increase

were (i) payments to Global Atlantic policyholders and (ii) distributions to fund investors as a result of realized proceeds, most

notably from Global Infrastructure Investors III and one of our infrastructure separately managed accounts with a public

pension plan.

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For the year ended December 31, 2025 , the value of our infrastructure investment portfolio appreciated 11% and the

value of our opportunistic real estate equity investment portfolio appreciated by 5%.

Credit and Liquid Strategies

The following table reflects the changes in the AUM of our Credit and Liquid Strategies business line from December 31,

2024 to December 31, 2025 :

($ in millions)

December 31, 2024

New Capital Raised

Distributions and Other

Redemptions

Change in Value

December 31, 2025

AUM of our Credit and Liquid Strategies business line totaled $322.0 billion as of December 31, 2025 , an increase of $45.8

billion, compared to AUM of $276.2 billion as of December 31, 2024 .

The increase was primarily attributable to (i) new capital raised from Global Atlantic inflows and various private credit and

leveraged credit investment funds, (ii) the issuance of CLOs, and, to a lesser extent, (iii) investment value appreciation across

our leveraged credit and private credit investment funds, and on assets managed by Marshall Wace. Partially offsetting the

increase were (i) payments to Global Atlantic policyholders, (ii) distributions to, and redemptions from, fund investors at

certain private and leveraged credit funds, and (iii) redemptions at Marshall Wace.

Fee Paying Assets Under Management

Private Equity

The following table reflects the changes in the FPAUM of our Private Equity business line from December 31, 2024 to

December 31, 2025 :

($ in millions)

December 31, 2024

New Capital Raised

Acquisitions (1)

Distributions and Other

Redemptions

Net Changes in Fee Base of Certain Funds

Change in Value

December 31, 2025

(1) Reflects the FPAUM of investment funds sponsored (or managed) by HealthCare Royalty Management, LLC at closing.

FPAUM of our Private Equity business line was $151.2 billion as of December 31, 2025 , an increase of $31.6 billion,

compared to $119.6 billion as of December 31, 2024 .

The increase was primarily attributable to (i) investment funds sponsored (or managed) by HealthCare Royalty

Management, LLC, (ii) management fees commencing at North America Fund XIV in the second quarter of 2025, and (iii) new

capital raised from our private equity K-Series vehicles, our core private equity strategy, and assets we manage and earn fees

from in our Strategic Holdings segment. Partially offsetting the increase were (i) a change in fee base for North America Fund

XIII as a result of the fund entering its post-investment period in the second quarter of 2025, during which we earn fees on

invested capital rather than committed capital, (ii) distributions to fund investors primarily as a result of realized proceeds,

most notably from Asian Fund III and Americas Fund XII and (iii) fees waived at North America Fund XI in exchange for

extending the term of the fund.

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Real Assets

The following table reflects the changes in the FPAUM of our Real Assets business line from December 31, 2024 to

December 31, 2025 :

($ in millions)

December 31, 2024

New Capital Raised

Distributions and Other

Redemptions

Net Changes in Fee Base of Certain Funds

Change in Value

December 31, 2025

FPAUM of our Real Assets business line was $163.5 billion as of December 31, 2025 , an increase of $23.8 billion,

compared to $139.7 billion as of December 31, 2024 .

The increase was primarily attributable to (i) new capital raised from Global Atlantic inflows invested in real estate, our

infrastructure K-Series vehicles, and Global Infrastructure Investors V, (ii) management fees commencing at Asia Pacific

Infrastructure III in the fourth quarter of 2025, and to a lesser extent, (iii) appreciation in investment value from the

Diversified Core Infrastructure Fund. Partially offsetting the increase were (i) a change in fee base for Asia Pacific

Infrastructure III in the fourth quarter of 2025, during which we earn fees on invested capital rather than committed capital,

(ii) payments to Global Atlantic policyholders, and (iii) distributions to fund investors as a result of realized proceeds, most

notably from one of our infrastructure separately managed accounts with a public pension plan and Global Infrastructure

Investors III.

Credit and Liquid Strategies

The following table reflects the changes in the FPAUM of our Credit and Liquid Strategies business line from December

31, 2024 to December 31, 2025 :

($ in millions)

December 31, 2024

New Capital Raised

Distributions and Other

Redemptions

Change in Value

December 31, 2025

FPAUM of our Credit and Liquid Strategies business line was $289.5 billion as of December 31, 2025 , an increase of

$36.8 billion, compared to $252.7 billion as of December 31, 2024 .

The increase was primarily attributable to (i) new capital raised from Global Atlantic inflows and deployment at various

private credit and leveraged credit investment funds, (ii) the issuance of CLOs, and, to a lesser extent, (iii) investment value

appreciation on assets managed by Marshall Wace. Partially offsetting the increase were (i) payments to Global Atlantic

policyholders, (ii) distributions to, and redemptions from, fund investors at certain private and leveraged credit funds, and (iii)

redemptions at Marshall Wace.

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Uncalled Commitments

Private Equity

As of December 31, 2025 , our Private Equity business line had $52.3 billion of remaining uncalled commitments that

could be called for investments in new transactions as compared to $54.9 billion as of December 31, 2024. The decrease was

primarily attributable to (i) the release of capital commitments related to one of our strategic investor partnerships with an

insurance client and (ii) capital called from fund investors to make investments, largely offset by new capital commitments

from fund investors during the period.

Real Assets

As of December 31, 2025 , our Real Assets business line had $35.0 billion of remaining uncalled commitments that could

be called for investments in new transactions as compared to $33.3 billion as of December 31, 2024. The increase was

primarily attributable to new capital commitments from fund investors, which was partially offset by capital called from fund

investors to make investments during the period.

Credit and Liquid Strategies

As of December 31, 2025 , our Credit and Liquid Strategies business line had $31.1 billion of remaining uncalled

commitments that could be called for investments in new transactions as compared to $21.4 billion as of December 31, 2024.

The increase was primarily attributable to new capital commitments from fund investors, which was partially offset by capital

called from fund investors to make investments during the period.

Capital Invested

Private Equity

For the year ended December 31, 2025 , $24.1 billion of capital was invested by our Private Equity business line, as

compared to $17.1 billion for the year ended December 31, 2024 . The increase was driven primarily by a $4.7 billion increase

in capital invested in our core private equity strategy and a $2.5 billion increase in capital invested in our traditional private

equity strategy. During the year ended December 31, 2025 , 41% of capital deployed in private equity was in transactions in

North America, 39% was in Europe, and 20% was in the Asia-Pacific region. The number of large private equity investments

made in any quarterly or year-to-date period is volatile and, consequently, a significant amount of capital invested in one

period or a few periods may not be indicative of a similar level of capital deployment in future periods.

Real Assets

For the year ended December 31, 2025 , $26.7 billion of capital was invested by our Real Assets business line, as

compared to $27.9 billion for the year ended December 31, 2024 . The decrease was driven primarily by a $3.8 billion decrease

in capital invested in our real estate strategy, partially offset by (i) a $1.7 billion increase in capital invested in our

infrastructure strategy and (ii) a $0.8 billion increase in capital invested in our energy strategy. During the year ended

December 31, 2025 , 53% of capital deployed in real assets was in transactions in North America, 22% was in Europe, and 25%

was in the Asia-Pacific region. The number of large real assets investments made in any quarterly or year-to-date period is

volatile and, consequently, a significant amount of capital invested in one period or a few periods may not be indicative of a

similar level of capital deployment in future periods.

Credit and Liquid Strategies

For the year ended December 31, 2025 , $43.8 billion of capital was invested by our Credit and Liquid Strategies business

line, as compared to $38.6 billion for the year ended December 31, 2024 . The increase was driven primarily by a higher level

of capital deployed across our private credit strategies, most notably direct lending. During the year ended December 31,

2025 , 79% of capital deployed was in transactions in North America, 16% was in Europe, and 5% was in the Asia-Pacific region.

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Analysis of Insurance Segment Operating Results

The following table sets forth information regarding KKR's insurance segment operating results for the years ended

December 31, 2025 and 2024 :

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Net Investment Income

Net Cost of Insurance

General, Administrative and Other

Insurance Operating Earnings

Net Investment Income

Net investment income increased for the year ended December 31, 2025 , as compared to the year ended December 31,

2024 , primarily due to (i) increased average assets under management from the cumulative impact of new business volume

growth, and (ii) higher average portfolio yields.

Net Cost of Insurance

Net cost of insurance increased for the year ended December 31, 2025 , as compared to the year ended December 31,

2024 , primarily due to (i) growth in reserves in the institutional and individual market channels as a result of the cumulative

impact of new business volumes in the current year, and (ii) higher average funding costs due to higher crediting rates and the

routine run-off of older business originated in a lower interest rate environment.

Net cost of insurance for the year ended December 31, 2025 , also reflects a $40.1 million favorable impact from the

annual assumption review changes (as discussed above under —Consolidated Results of Operations (GAAP Basis)—Net Policy

Benefits and Claims) due to (i) higher expected yield assumptions for certain interest-sensitive life products, and (ii) favorable

expected surrender and persistency assumption changes for certain variable annuity and life insurance products offset in part

by (i) higher mortality rate assumptions for certain life insurance products, and (ii) higher surrender rate assumptions for

certain assumed annuity products.

General, Administrative and Other

General, administrative and other expenses increased for the year ended December 31, 2025 , as compared to the year

ended December 31, 2024 , primarily due to (i) an increase in cash compensation expenses, and (ii) higher interest expense

primarily reflecting higher levels of borrowing.

Insurance Operating Earnings

Insurance operating earnings increased for the year ended December 31, 2025 , as compared to the year ended December

31, 2024 , primarily due to an increase in net investment income due to an increase in average assets under management and

higher portfolio yields, and the favorable impact of the annual assumption review, partially offset by an increase in net cost of

insurance due to the cumulative impact of new business volume growth and higher crediting rates.

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Analysis of Strategic Holdings Segment Operating Results

The following table sets forth information regarding KKR's strategic holdings segment operating results for the years

ended December 31, 2025 and 2024 :

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Dividends, Net

Strategic Holdings Operating Earnings

Net Realized Investment Income

Strategic Holdings Segment Earnings

Dividends, Net

For the year ended December 31, 2025 , dividends, net were comprised of dividend income from 1-800 Contacts, Exact

Holding B.V., April S.A., Atlantic Aviation FBO Inc. (infrastructure: transportation sector) and ERM Worldwide Group Limited

(services sector). For the year ended December 31, 2024 , dividends, net were comprised of dividend income from 1-800

Contacts Inc., Exact Holdings B.V., Viridor Limited (energy and energy transition sector), FiberCop S.p.A., Arnott's Biscuits

Limited (consumer products sector) and Atlantic Aviation FBO Inc. For the year ended December 31, 2025 , the contractual

management fee charged by our Asset Management segment was $36.6 million and for the year ended December 31, 2024 ,

the management fee was $31.8 million.

Net Realized Investment Income

For the year ended December 31, 2025 , net realized investment income was comprised of realized gains from the sale of

CyrusOne Inc. (infrastructure: telecommunications sector) and Refresco Group B.V. (manufacturing sector). For the year

ended December 31, 2024 net realized investment income was comprised of a realized gain from the sale of FiberCop S.p.A.

Realized investment income earned in our Strategic Holdings segment is reduced by a contractual performance fee charged by

our Asset Management segment. For the year ended December 31, 2025 , the performance fee was $12.3 million and for the

year ended December 31, 2024 , the performance fee was $15.5 million.

Strategic Holdings Segment Earnings

Strategic Holdings segment earnings for the year ended December 31, 2025 , was higher compared to the prior period

primarily due to a higher level of dividends, partially offset by a lower level of net realized investment income.

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Analysis of Non-GAAP Performance Measures

The following is a discussion of our Non-GAAP performance measures for the years ended December 31, 2025 and 2024 .

For a discussion comparing our Non-GAAP performance measures for the years ended December 31, 2024 and 2023, see "Part

II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on

Form 10-K for the year ended December 31, 2024, filed with the SEC on February 28, 2025.

Years Ended

($ in thousands)

December 31, 2025

December 31, 2024

Change

Fee Related Earnings

Insurance Operating Earnings

Strategic Holdings Operating Earnings

Total Operating Earnings

Net Realized Performance Income

Net Realized Investment Income

Total Investing Earnings

Total Segment Earnings

Interest Expense, Net and Other

Income Taxes on Adjusted Earnings

Adjusted Net Income

Total Operating Earnings

The increase in total operating earnings for the year ended December 31, 2025 compared to the prior period was

primarily due to a higher level of fee related earnings and to a lesser extent insurance operating earnings and strategic

holdings operating earnings. For a discussion of fee related earnings, insurance operating earnings, and strategic holdings

operating earnings, see "—Analysis of Asset Management Segment Operating Results", "—Analysis of Insurance Segment

Operating Results", and "—Analysis of Strategic Holdings Segment Operating Results."

Total Investing Earnings

The decrease in total investing earnings for the year ended December 31, 2025 compared to the prior period was

primarily due to (i) a lower level of net realized investment income and (ii) a lower level of net realized performance income

due to the reduction in realized performance income for the repayment of the Asian Fund II clawback obligation in the fourth

quarter of 2025 . For a discussion of net realized performance income and net realized investment income, see "—Analysis of

Asset Management Segment Operating Results" and "—Analysis of Strategic Holdings Segment Operating Results."

Total Segment Earnings

The increase in total segment earnings for the year ended December 31, 2025 compared to the prior period was primarily

due to an increase in total operating earnings, offset by a decrease in total investing earnings.

Adjusted Net Income

The increase in adjusted net income for the year ended December 31, 2025 compared to the prior period was primarily

due to a higher level of total segment earnings, partially offset by an increase in income taxes on adjusted earnings and

interest expense, net and other.

Interest Expense, Net and Other

The increase in interest expense, net and other for the year ended December 31, 2025 compared to the prior period was

primarily due to dividends paid on the Series D Mandatory Convertible Preferred Stock that was issued in the first quarter of

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Income Taxes on Adjusted Earnings

The increase in income taxes on adjusted earnings for the year ended December 31, 2025 compared to the prior period

was primarily due to a higher level of total segment earnings.

For the years ended December 31, 2025 and 2024, the amount of the tax benefit from equity-based compensation

included in income taxes on adjusted earnings was $124.4 million and $126.7 million, respectively. The inclusion of the tax

benefit from equity-based compensation in Adjusted Net Income had the effect of increasing this measure by 3% for both the

years ended December 31, 2025 and 2024 .

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Fund Performance Metrics

Private Equity

The table below presents information as of December 31, 2025 , relating to our current private equity and other

investment vehicles reported in our Private Equity business line for which we have the ability to earn carried interest. This

data does not reflect acquisitions or disposals of investments, changes in investment values, or distributions occurring after

December 31, 2025 .

Investment Period

Amount ($ in millions)

Start

Date (1)

End

Date (2)

Commitment  (3)

Uncalled

Commitments

Invested

Realized

Remaining

Cost  (4)

Remaining

Fair Value

Gross Accrued

Carried

Interest

Private Equity Business Line

North America Fund XIV

North America Fund XIII

Americas Fund XII

North America Fund XI

2006 Fund (5)

Millennium Fund (5)

Ascendant Fund

European Fund VI

European Fund V

European Fund IV

European Fund III (5)

European Fund II (5)

Asian Fund IV

Asian Fund III

Asian Fund II

Asian Fund (5)

Next Generation Technology Growth Fund III

Next Generation Technology Growth Fund II

Next Generation Technology Growth Fund

Health Care Strategic Growth Fund II

Health Care Strategic Growth Fund

Global Impact Fund II

Global Impact Fund

Co-Investment Vehicles and Other

Various

Various

Core Investors II

Core Investors I

Other Core Vehicles

Various

Various

Unallocated Commitments (6)

Total Private Equity

(1) The start date represents the start of the fund's investment period as defined in the fund's governing documents and may or may not be the same as the

date upon which management fees begin to accrue.

(2) The end date represents the end of the fund's investment period as defined in the fund's governing documents and is generally not the date upon which

management fees cease to accrue. For funds that initially charge management fees on the basis of committed capital, the end date is generally the date

on or after which the management fees begin to be calculated instead on the basis of invested capital and may, for certain funds, begin to be calculated

using a lower rate.

(3) The commitment represents the aggregate capital commitments to the fund, including capital commitments by third-party fund investors and the general

partner. Foreign currency commitments have been converted into U.S. dollars based on the exchange rate that prevailed on December 31, 2025 .

(4) The remaining cost represents the initial investment of the general partner and limited partners, reduced for returns of capital.

(5) The "Invested" and "Realized" columns do not include the amounts of any realized investments that restored the unused capital commitments of the fund

investors, if any.

(6) "Unallocated Commitments" represent commitments received from our strategic investor partnerships that have yet to be allocated to a particular

investment strategy.

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Real Assets

The table below presents information as of December 31, 2025 , relating to our current real asset and other investment

vehicles reported in our Real Assets business line for which we have the ability to earn carried interest. This data does not

reflect acquisitions or disposals of investments, changes in investment values, or distributions occurring after December 31,

Investment Period

Amount ($ in millions)

Start

Date (1)

End

Date (2)

Commitment  (3)

Uncalled

Commitments

Invested

Realized

Remaining

Cost  (4)

Remaining

Fair Value

Gross Accrued

Carried

Interest

Real Assets Business Line

Global Infrastructure Investors V

Global Infrastructure Investors IV

Global Infrastructure Investors III

Global Infrastructure Investors II

Global Infrastructure Investors

Asia Pacific Infrastructure Investors III

Asia Pacific Infrastructure Investors II

Asia Pacific Infrastructure Investors

Diversified Core Infrastructure Fund

Global Climate Transition Fund (6)

Real Estate Partners Americas IV

Real Estate Partners Americas III

Real Estate Partners Americas II

Real Estate Partners Americas

Real Estate Partners Europe II

Real Estate Partners Europe

Asia Real Estate Partners

Property Partners Americas

Real Estate Credit Opportunity Partners II

Real Estate Credit Opportunity Partners

Energy Related Vehicles

Various

Various

Co-Investment Vehicles and Other

Various

Various

Unallocated Commitments (7)

Total Real Assets

(1) The start date represents the start of the fund's investment period as defined in the fund's governing documents and may or may not be the same as the

date upon which management fees begin to accrue.

(2) The end date represents the end of the fund's investment period as defined in the fund's governing documents and is generally not the date upon which

management fees cease to accrue. For funds that initially charge management fees on the basis of committed capital, the end date is generally the date

on or after which the management fees begin to be calculated instead on the basis of invested capital and may, for certain funds, begin to be calculated

using a lower rate.

(3) The commitment represents the aggregate capital commitments to the fund, including capital commitments by third-party fund investors and the general

partner. Foreign currency commitments have been converted into U.S. dollars based on the exchange rate that prevailed on December 31, 2025 .

(4) The remaining cost represents the initial investment of the general partner and limited partners, reduced for returns of capital.

(5) Open-ended fund.

(6) In cludes an Asia-focused vehicle with different fund terms.

(7) "Unallocated Commitments" represent commitments received from our strategic investor partnerships that have yet to be allocated to a particular

investment strategy.

Private Equity and Real Asset Performance

The table below presents information as of December 31, 2025 , relating to the historical performance of certain of our

Private Equity and Real Assets investment vehicles since inception, which we believe illustrates the benefits of our investment

approach. This data does not reflect additional capital raised since December 31, 2025 , or acquisitions or disposals of

investments, changes in investment values, or distributions occurring after that date. The information presented below is not

intended to be representative of any past or future performance for any particular period other than the period presented

below. Past performance is no guarantee of future results.

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Private Equity and Real Assets Business Lines

Investment Funds and Other Vehicles

Commitment (2)

Invested

Realized (4)

Unrealized

Total Value

Gross

IRR (5)

Net

IRR (5)

Gross

Multiple of

Invested

Capital (5)

($ in millions)

Total Investments

Legacy Funds (1)

1976 Fund

1980 Fund

1982 Fund

1984 Fund

1986 Fund

1987 Fund

1993 Fund

1996 Fund

Subtotal - Legacy Funds

Included Funds

European Fund (1999)

Millennium Fund (2002)

European Fund II (2005)

2006 Fund (2006)

Asian Fund (2007)

European Fund III (2008)

E2 Investors (Annex Fund) (2009)

China Growth Fund (2010)

Natural Resources Fund (2010)

Global Infrastructure Investors (2010)

North America Fund XI (2012)

Asian Fund II (2013)

Real Estate Partners Americas (2013)

Energy Income and Growth Fund (2013)

Global Infrastructure Investors II (2014)

European Fund IV (2015)

Real Estate Partners Europe (2015)

Next Generation Technology Growth Fund (2016)

Health Care Strategic Growth Fund (2016)

Americas Fund XII (2017)

Real Estate Credit Opportunity Partners (2017)

Core Investors I (2018)

Asian Fund III (2017)

Real Estate Partners Americas II (2017)

Global Infrastructure Investors III (2018)

Global Impact Fund (2019)

European Fund V (2019)

Energy Income and Growth Fund II (2018)

Asia Real Estate Partners (2019)

Next Generation Technology Growth Fund II (2019)

Real Estate Credit Opportunity Partners II (2019)

Asia Pacific Infrastructure Investors (2020)

Asian Fund IV (2020)

Real Estate Partners Europe II (2020)

Real Estate Partners Americas III (2021)

Health Care Strategic Growth Fund II (2021)

North America Fund XIII (2021)

Core Investors II (2022)

Global Infrastructure Investors IV (2021)

Asia Pacific Infrastructure Investors II (2022)

Ascendant Fund (2022)

Next Generation Technology Growth Fund III (2022)

European Fund VI (2022)

Global Impact Fund II (2022)

Global Infrastructure Investors V (2024) (3)

Global Climate Transition Fund (2024) (3)

Real Estate Partners Americas IV (2024) (3)

North America Fund XIV (2025) (3)

Asia Pacific Infrastructure Investors III (2025) (3)

Subtotal - Included Funds

All Funds

(1) These funds were not contributed to KKR as part of the acquisition of the assets and liabilities of KKR & Co. (Guernsey) L.P. (formerly known as KKR Private

Equity Investors, L.P.) on October 1, 2009.

(2) Where commitments are not U.S. dollar-denominated, such amounts have been converted into U.S. dollars based on the exchange rate prevailing on

December 31, 2025 .

(3) The gross IRR, net IRR and gross multiple of invested capital are calculated for our investment funds that made their first investment at least 24 months

prior to December 31, 2025 . We therefore have not calculated gross IRRs, net IRRs and gross multiples of invested capital with respect to these funds.

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(4) An investment is considered realized when it has been disposed of or has otherwise generated disposition proceeds or current income that has been

distributed by the relevant fund.

(5) IRRs measure the aggregate annual compounded returns generated by a fund's investments over a holding period. Net IRRs are calculated after giving

effect to the allocation of realized and unrealized carried interest and the payment of any applicable management fees and organizational expenses.

Gross IRRs are calculated before giving effect to the allocation of realized and unrealized carried interest and the payment of any applicable management

fees and organizational expenses.

The gross multiples of invested capital measure the aggregate value generated by a fund's investments in absolute terms. Each multiple of invested capital

is calculated by adding together the total realized and unrealized values of a fund's investments and dividing by the total amount of capital invested by the

fund. Such amounts do not give effect to the allocation of realized and unrealized carried interest or the payment of any applicable management fees or

organizational expenses.

KKR's Private Equity and Real Assets funds may utilize third-party financing facilities to provide liquidity to such funds. The above net and gross IRRs are

calculated from the time capital contributions are due from fund investors to the time fund investors receive a related distribution from the fund, and the

use of such financing facilities generally decreases the amount of time that would otherwise be used to calculate IRRs, which tends to increase IRRs when

fair value grows over time and decrease IRRs when fair value decreases over time.

For more information, see "Risk Factors—Risks Related to Our Investment Activities—Future results of our investments

may be different than, and may not achieve the levels of, any of our historical returns" in this report.

Credit and Liquid Strategies

The table below presents information as of December 31, 2025 , relating to our current credit investment vehicles

reported in our Credit and Liquid Strategies business line for which we have the ability to earn carried interest. This data does

not reflect acquisitions or disposals of investments, changes in investment values, or distributions occurring after December

Investment Period

Amount ($ in millions)

Start

Date (1)

End

Date (2)

Commitment  (3)

Uncalled

Commitments

Invested

Realized

Remaining

Cost  (4)

Remaining

Fair Value

Gross Accrued

Carried

Interest

Line

Opportunities Fund II

Dislocation Opportunities Fund

Special Situations Fund II

Special Situations Fund

Mezzanine Partners

Asset-Based Finance Partners II

Asset-Based Finance Partners

Private Credit Opportunities Partners II

Lending Partners IV

Lending Partners III

Lending Partners II

Lending Partners

Lending Partners Europe II

Lending Partners Europe

Asia Credit Opportunities II

Asia Credit Opportunities

Other Alternative Credit Vehicles

Various

Various

Total Credit and Liquid Strategies

(1) The start date represents the start of the fund's investment period as defined in the fund's governing documents and may or may not be the same as the

date upon which management fees begin to accrue.

(2) The end date represents the end of the fund's investment period as defined in the fund's governing documents and is generally not the date upon which

management fees cease to accrue. For funds that initially charge management fees on the basis of committed capital, the end date is generally the date

on or after which the management fees begin to be calculated instead on the basis of invested capital and may, for certain funds, begin to be calculated

using a lower rate.

(3) The commitment represents the aggregate capital commitments to the fund, including capital commitments by third-party fund investors and the general

partner. Foreign currency commitments have been converted into U.S. dollars based on the foreign exchange rate that prevailed on December 31, 2025 .

(4) The remaining cost represents the initial investment of the general partner and limited partners, reduced for returns of capital.

The following table presents information regarding certain leveraged credit strategies managed by KKR from inception to

December 31, 2025 . The information presented below is not intended to be representative of any past or future performance

for any particular period other than the period presented below. Past performance is no guarantee of any future result.

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Leveraged Credit Strategy

Inception Date

Gross

Returns

Net

Returns

Benchmark  (1)

Benchmark

Gross

Returns

Multi-Asset Credit Composite

Jul 2008

50% S&P/LSTA Loan Index, 50% BoAML HY Master II

Index (2)

Opportunistic Credit (3)

May 2008

50% S&P/LSTA Loan Index, 50% BoAML HY Master II

Index (3)

Bank Loans

Apr 2011

S&P/LSTA Loan Index (4)

High-Yield

Apr 2011

BoAML HY Master II Index (5)

European Leveraged Loans (6)

Sep 2009

CS Inst West European Leveraged Loan Index (7)

European Credit Opportunities (6)

Sept 2007

S&P European Leveraged Loans (All Loans) (8)

(1) The benchmarks referred to herein include the S&P/LSTA Leveraged Loan Index (the "S&P/LSTA Loan Index"), S&P/LSTA U.S. B/BB Ratings Loan Index (the

"S&P/LSTA BB-B Loan Index"), the Bank of America Merrill Lynch High Yield Master II Index (the "BoAML HY Master II Index"), the BofA Merrill Lynch BB-B

US High Yield Index (the "BoAML HY BB-B Constrained"), the Credit Suisse Institutional Western European Leveraged Loan Index (the "CS Inst West

European Leveraged Loan Index"), and S&P European Leveraged Loans (All Loans). The S&P/LSTA Loan Index is a daily tradable index for the U.S. loan

market that seeks to mirror the market-weighted performance of the largest institutional loans that meet certain criteria. The BoAML HY Master II Index is

an index for high-yield corporate bonds. It is designed to measure the broad high-yield market, including lower-rated securities. The CS Inst West

European Leveraged Loan Index contains only institutional loan facilities priced above 90, excluding TL and TLa facilities and loans rated CC, C or are in

default. The S&P European Leveraged Loan Index reflects the market-weighted performance of institutional leveraged loan portfolios investing in

European credits. While the returns of our leveraged credit strategies reflect the reinvestment of income and dividends, none of the indices presented in

the chart above reflect such reinvestment, which has the effect of increasing the reported relative performance of these strategies as compared to the

indices. Furthermore, these indices are not subject to management fees, incentive allocations, or expenses.

(2) Performance is based on a blended composite of Bank Loans, High Yield, and Structured Credit strategy accounts. The benchmark used for purposes of

comparison for the Multi-Asset Credit Composite strategy is based on 65% S&P/LSTA Loan Index and 35% BoAML HY Master II Index to May 2022, and

50% S&P/LSTA Loan Index, 50% BoAML HY Master II Index, from June 2022.

(3) The Opportunistic Credit strategy invests in high-yield securities and corporate loans with no preset allocation. The benchmark used for purposes of

comparison for the Opportunistic Credit strategy presented herein is based on 50% S&P/LSTA Loan Index and 50% BoAML HY Master II Index. Funds

within this strategy may utilize third-party financing facilities to enhance investment returns. In cases where financing facilities are used, the amounts

drawn on the facility are deducted from the assets of the fund in the calculation of net asset value, which tends to increase returns when net asset value

grows over time and decrease returns when net asset value decreases over time.

(4) Performance is based on a composite of portfolios that primarily invest in leveraged loans. The benchmark used for purposes of comparison for the Bank

Loans strategy is based on the S&P/LSTA Loan Index.

(5) Performance is based on a composite of portfolios that primarily invest in high-yield securities. The benchmark used for purposes of comparison for the

High Yield strategy is based on the BoAML HY Master II Index.

(6) The returns presented are calculated based on local currency.

(7) Performance is based on a composite of portfolios that primarily invest in higher quality leveraged loans. The benchmark used for purposes of comparison

for the European Leveraged Loans strategy is based on the CS Inst West European Leveraged Loan Index.

(8) Performance is based on a composite of portfolios that primarily invest in European institutional leveraged loans. The benchmark used for purposes of

comparison for the European Credit Opportunities strategy is based on the S&P European Leveraged Loans (All Loans) Index.

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The following table presents information regarding our alternative credit investment funds where investors have capital

commitments from inception to December 31, 2025 . The information presented below is not intended to be representative of

any past or future performance for any particular period other than the period presented below. Past performance is no

guarantee of any future result.

Credit and Liquid Strategies

Investment Funds

Investment

Period Start

Date

Commitment

Invested (1)

Realized (1)

Unrealized

Total

Value

Gross

IRR (2)

Net

IRR (2)

Multiple of

Invested

Capital (3)

($ in millions)

Opportunities Fund II

Nov 2021

Dislocation Opportunities Fund

Aug 2019

Special Situations Fund II

Feb 2015

Special Situations Fund

Jan 2013

Mezzanine Partners

July 2010

Asset-Based Finance Partners II

Mar 2024

Asset-Based Finance Partners

Oct 2020

Private Credit Opportunities Partners II

Dec 2015

Lending Partners IV

Mar 2022

Lending Partners III

Apr 2017

Lending Partners II

Jun 2014

Lending Partners

Dec 2011

Lending Partners Europe II

May 2019

Lending Partners Europe

Mar 2015

Asia Credit Opportunities II

Feb 2025

Asia Credit Opportunities

Jan 2021

Other Alternative Credit Investment Vehicles

Various

All Funds

(1) Recycled capital is excluded from the amounts invested and realized.

(2) These credit funds utilize third-party financing facilities to provide liquidity to such funds, and in such event IRRs are calculated from the time capital

contributions are due from fund investors to the time fund investors receive a related distribution from the fund. The use of such financing facilities

generally decreases the amount of invested capital that would otherwise be used to calculate IRRs, which tends to increase IRRs when fair value grows

over time and decrease IRRs when fair value decreases over time. IRRs measure the aggregate annual compounded returns generated by a fund's

investments over a holding period and are calculated taking into account recycled capital. Net IRRs presented are calculated after giving effect to the

allocation of realized and unrealized carried interest and the payment of any applicable management fees and organizational expenses. Gross IRRs are

calculated before giving effect to the allocation of carried interest and the payment of any applicable management fees and organizational expenses.

(3) The multiples of invested capital measure the aggregate value generated by a fund's investments in absolute terms. Each multiple of invested capital is

calculated by adding together the total realized and unrealized values of a fund's investments and dividing by the total amount of capital invested by the

investors. The use of financing facilities generally decreases the amount of invested capital that would otherwise be used to calculate multiples of

invested capital, which tends to increase multiples when fair value grows over time and decrease multiples when fair value decreases over time. Such

amounts do not give effect to the allocation of any realized and unrealized returns on a fund's investments to the fund's general partner pursuant to a

carried interest or the payment of any applicable management fees and are calculated without taking into account recycled capital.

For additional information regarding impact of market conditions on the value and performance of our investments, see

"Risk Factors—Risks Related to Our Business—Difficult market and economic conditions can, and periodically do, materially

and adversely affect KKR." and "Risk Factors—Risks Related to Our Investment Activities—Future results of our investments

may be different than, and may not achieve the levels of, any of our historical returns" in this report.

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Segment Balance Sheet Measures

Asset Management Segment Investment Portfolio

To the extent our investments are realized at values above or below their cost in future periods, adjusted net income

would be positively or negatively affected by the amount of any such gain or loss, respectively, during the period in which the

realization event occurs.

Our investments in the Asset Management segment by asset class as of December 31, 2025 are as follows:

As of December 31, 2025

Asset Management Segment Investments (1)

Cost

Fair Value

Fair Value as a % of

Total Asset

Management

Investments

($ in thousands)

Traditional Private Equity

Growth Equity

Private Equity Total

Real Estate

Infrastructure

Energy

Real Assets Total

Leveraged Credit

Alternative Credit

Credit Total

Other

Total Asset Management Segment Investments

(1) Investments is a term used solely for purposes of financial presentation of a portion of KKR's balance sheet and includes majority ownership of

subsidiaries that operate KKR's asset management and insurance businesses, including the general partner interests of KKR's investment funds.

Investments presented are principally the assets measured at fair value that are held by KKR's asset management segment, which, among other things,

does not include the underlying investments held by Global Atlantic and Marshall Wace. This table excludes investments in our Strategic Holdings and

Insurance segments, for which additional information is available  in Note 21 "Segment Reporting" in our financial statements.

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Insurance Segment Investment Portfolio

As of December 31, 2025, the Insurance segment’s investment portfolio (on an unconsolidated basis, excluding the

elimination of intercompany balances) consisted of the following categories of investments:

($ in thousands)

As of December 31, 2025

Fixed-maturity securities, available-for-sale

Fixed-maturity securities, trading

Mortgage and other loan receivables

Real assets

Funds withheld receivables, at interest

Other investments

Total investments

The portion of the Insurance segment’s investment portfolio consisting of floating rate assets was 27% and 25% as of

December 31, 2025 , and December 31, 2024 , respectively.

Credit Quality of Fixed Maturity Securities

As of December 31, 2025 , 95% , and 91% of the Insurance segment’s fixed maturity securities were considered investment

grade under ratings from the Securities Valuation Office of the NAIC and NRSROs, respectively. As of December 31, 2024 , 95% ,

and 90% of fixed maturity securities were considered investment grade under ratings from NAIC and NRSROs, respectively.

Securities where a rating by a NRSRO was not available are considered investment grade if they have a NAIC designation of

The Securities Valuation Office of the NAIC evaluates the fixed maturity security investments of insurers for regulatory

reporting and capital assessment purposes and assigns securities to one of six credit quality categories called “NAIC

designations.” Using an internally developed rating is permitted by the NAIC if no rating is available. These designations are

generally similar to the credit quality designations of NRSROs for marketable fixed maturity securities, except for certain

structured securities as described below. NAIC designations of “1,” highest quality, and “2,” high quality, include fixed

maturity securities generally considered investment grade by NRSROs. NAIC designations “3” through “6” include fixed

maturity securities generally considered below investment grade by NRSROs.

Consistent with the NAIC Process and Procedures Manual, a NRSRO rating was assigned based on the following criteria: (i)

the equivalent S&P rating where the security is rated by one NRSRO; (ii) the equivalent S&P rating of the lowest NRSRO when

the security is rated by two NRSROs; and (iii) the equivalent S&P rating of the second lowest NRSRO if the security is rated by

three or more NRSROs. If the lowest two NRSROs’ ratings are equal, then such rating will be the assigned rating. NRSROs’

ratings available for the periods presented were S&P, Fitch, Moody’s, DBRS, Inc., and Kroll Bond Rating Agency, Inc. If no

rating is available from a rating agency, then an internally developed rating is used.

Within the funds withheld receivable at interest portfolio, 97% of the fixed maturity securities were investment grade by

NAIC designation as of both December 31, 2025 , and December 31, 2024 , respectively.

Trading fixed maturity securities primarily back funds withheld payable at interest where the investment performance is

ceded to reinsurers under the terms of the respective reinsurance agreements.

Unrealized Gains and Losses on Available-for-Sale Fixed Maturity Securities

The Insurance segment’s investments in available-for-sale (“AFS”) fixed maturity securities are reported at fair value with

changes in fair value recorded in other comprehensive income as unrealized gains or losses, net of taxes and offsets.

Unrealized gains and losses can be created by changes in interest rates or by changes in credit spreads.

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As of December 31, 2025 , and December 31, 2024 , the Insurance segment had gross unrealized losses on below

investment grade AFS fixed maturity securities of $313.8 million and $584.3 million based on NRSRO ratings, and $187.7

million and $245.6 million based on NAIC ratings, respectively. As of December 31, 2025 , unrealized losses were not

recognized in net income on these fixed maturity securities since the Insurance segments neither intends to sell the securities

nor does it believe that it is more likely than not that it will be required to sell these securities before recovery of their cost or

amortized cost basis.

Credit Quality of Mortgage and Other Loan Receivables

Mortgage and other loan receivables consist of commercial and residential mortgage loans, consumer loans, and other

loan receivables. As of December 31, 2025 , and December 31, 2024 , 27% and 30% of the total investments consisted of the

Insurance segment’s mortgage and other loan receivables, respectively.

The Insurance segment invests in U.S. mortgage loans, comprised of first lien and mezzanine commercial mortgage loans

and first lien residential mortgage loans. For the commercial mortgage loan portfolio, the most prevalent property type is

multi-family residential buildings, which represents approximately half of the portfolio as of both December 31, 2025 , and

December 31, 2024 . Office and retail properties represent approximately 21% and 20% of the portfolio as of December 31,

2025 and December 31, 2024 , respectively.

The Insurance segment’s commercial mortgage loans are assigned NAIC designations, with designations “CM1” and

“CM2” considered to be investment grade. As of both December 31, 2025 , and December 31, 2024 , 91% of the commercial

mortgage loan portfolio were rated investment grade based on NAIC designation, respectively. The payment status of over

99% of the commercial mortgage loan portfolio is current as of both December 31, 2025 , and December 31, 2024 ,

respectively.

The loan-to-value ratio is expressed as a percentage of the current amount of the loan relative to the value of the

underlying collateral. As of December 31, 2025 , and December 31, 2024 , approximately 89% and 90% , respectively, of the

commercial mortgage loans have a loan-to-value ratio of 70% or less, and as of December 31, 2025 , and December 31, 2024 ,

2% and 1% have loan-to-value ratio over 90%, respectively.

Changing economic conditions and updated assumptions affect the Insurance segment’s assessment of the collectibility

of commercial mortgage loans. Changing vacancies and rents are incorporated into the analysis performed to measure the

allowance for credit losses. In addition, the Insurance segment continuously monitors its commercial mortgage loan portfolio

to identify risk. Areas of emphasis are properties that have exposure to specific geographic events or have deteriorating

credit.

The Insurance segment’s residential mortgage loan portfolio primarily includes mortgage loans backed by single family

rental properties, prime loans, and re-performing loans that were purchased at a discount after they were modified and

returned to performing status. The Insurance segment also extends financing to counterparties in the form of repurchase

agreements secured by mortgage loans, including performing and non-performing mortgage loans.

As of December 31, 2025 , the payment status of 97% of the residential mortgage loan portfolio is current, and

approximately $273.4 million is 90 days or more past due or in process of foreclosure (representing 1% of the total residential

mortgage portfolio). As of December 31, 2024 , the payment status of 97% of the residential mortgage loan portfolio was

current and approximately $275.1 million were 90 days or more past due or in process of foreclosure (representing 1% of the

total residential mortgage portfolio).

The weighted average loan-to-value ratio for residential mortgage loans was 64% and 63% as of December 31, 2025 , and

December 31, 2024 , respectively .

The Insurance segment’s consumer loan portfolio is primarily comprised of home improvement loans, residential solar

loans, student loans, and auto loans. As of December 31, 2025 , 97% of the consumer loan portfolio is in current status and

approximately $31.3 million is 90 days or more past due or in process of foreclosure (representing 1% of the total consumer

loan portfolio).

See Note 7 “Investments” in the accompanying financial statements in this report for additional information regarding

the Insurance segment’s investment portfolio.

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Additional Information

To provide supplemental information to stockholders about the net assets of KKR on a segment basis, KKR’s book value

was $33.1 billion as of December 31, 2025 , which included cash and short-term investments of $4.8 billion . KKR's book value

includes its net investment in Global Atlantic, investments in the Asset Management and Strategic Holdings segments, and the

net impact of certain other assets and liabilities, including income taxes. KKR's book value excludes the net assets allocable to

investors in KKR’s investment funds and other noncontrolling interest holders. From January 1, 2025 through December 31,

2025 , the Asset Management segment transferred $1.1 billion of investments to the Insurance segment for which no gain or

loss was recognized.

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Reconciliations to GAAP Measures

Net Income (Loss) Attributable to KKR & Co. Inc. Common Stockholders

For the Year Ended

($ in thousands)

December 31, 2025

December 31, 2024

Net Income (Loss) - KKR Common Stockholders (GAAP)

Preferred Stock Dividends

Net Income (Loss) Attributable to Noncontrolling Interests

Income Tax Expense (Benefit)

Income (Loss) Before Tax (GAAP)

Impact of Consolidation and Other

Preferred Stock Dividends

Income Taxes on Adjusted Earnings

Asset Management Adjustments:

Unrealized (Gains) Losses

Unrealized Carried Interest

Unrealized Carried Interest Compensation

Transaction-related and Non-operating Items (1)

Equity-based Compensation

Equity-based Compensation - Performance based

Amortization of Acquired Intangibles

Strategic Holdings Adjustments:

Unrealized (Gains) Losses

Insurance Adjustments:

(Gains) Losses from Investments

Non-Operating Changes from Policy Liabilities and Derivatives

Transaction-Related and Non-Operating Items (1)

Equity-Based Compensation

Amortization of Acquired Intangibles

Adjusted Net Income

Interest Expense, Net

Preferred Stock Dividends

Net Income Attributable to Noncontrolling Interests

Income Taxes on Adjusted Earnings

Total Segment Earnings

Net Realized Performance Income

Net Realized Investment Income

Total Operating Earnings

Total Investing Earnings

Depreciation and Amortization

Adjusted EBITDA

(1) For the year ended December 31, 2025, Transaction-related and Other Non-operating items includes (i) $99 million related to transaction-related costs

and other corporate actions, and (ii) $39 million of costs associated with certain integration, restructuring, and other non-operating expenses across our

Asset Management and Insurance businesses.

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KKR & Co. Inc. Stockholders' Equity - Common Stock

($ in thousands)

December 31, 2025

KKR & Co. Inc. Stockholders' Equity – Common Stock (GAAP)

Impact of Consolidation and Other

Exchangeable Securities

Accumulated Other Comprehensive Income (Loss) (AOCI) and Other (Insurance)

Accumulated Unrealized (Gains) Losses on Loans carried at Fair Value (Insurance)

KKR Book Value (1)

(1) Book Value is a non-GAAP performance measure, which provides additional insight into the net assets of KKR presented on a basis that (i) excludes the net

assets that are allocated to investors in KKR’s investment funds and other noncontrolling interest holders, (ii) includes the net assets that are attributable

to certain securities exchangeable into shares of common stock of KKR & Co. Inc., (iii) includes the net investment in Global Atlantic, investments in the

Asset Management and Strategic Holdings segments, and (iv) includes the net impact of certain other assets and liabilities, including the net impact of

KKR's tax assets and liabilities as calculated under GAAP. Book Value excludes the dilutive impact of the conversion of any of KKR & Co. Inc.’s Series D

Mandatory Convertible Preferred Stock. If all outstanding shares of the Series D Mandatory Convertible Preferred Stock were converted into KKR & Co.

Inc. common stock as of December 31, 2025 , our Book Value would have increased by $2.5 billion and our common stock outstanding would have

increased by 20.8 million shares .

Cash and Cash Equivalents - Asset Management and Strategic Holdings

($ in thousands)

December 31, 2025

Cash and Cash Equivalents – Asset Management and Strategic Holdings (GAAP)

Impact of Consolidation and Other

Short-term Investments

Cash and Short-term Investments

Investments - Asset Management and Strategic Holdings

($ in thousands)

December 31, 2025

Investments – Asset Management and Strategic Holdings (GAAP)

Impact of Consolidation and Other

Short-term Investments

Investments – Asset Management Segment

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Liquidity

We manage our liquidity and capital requirements by (a) focusing on our cash flows before the consolidation of our funds

and CFEs and the effect of changes in short term assets and liabilities, which we anticipate will be settled for cash within one

year, and (b) seeking to maintain access to sufficient liquidity through various sources. The overall liquidity framework and

cash management approach of our insurance business are also based on seeking to build an investment portfolio that is cash

flow matched, providing cash inflows from insurance assets that meet our insurance companies' expected cash outflows to

pay their liabilities. Our primary cash flow activities typically involve (i) generating cash flow from operations; (ii) generating

income from investment activities, by investing in investments that generate yield (namely interest and dividends), as well as

through the sale of investments and other assets; (iii) funding capital commitments that we have made to, and advancing

capital to, our funds and CLOs; (iv) developing and funding new investment strategies, investment products, and other growth

initiatives, including acquisitions of other investments, assets, and businesses; (v) underwriting and funding capital

commitments in our capital markets business; (vi) distributing cash flow to our stockholders and any holders of our preferred

stock, if any; and (vii) paying borrowings, interest payments, and repayments under credit agreements, our senior and

subordinated notes, and other borrowing arrangements. See "—Liquidity," "—Liquidity Needs," and "—Dividends and Stock

Repurchases."

See "Risk Factors" and "—Business Environment" in this report for more information on factors that may impact our

business, financial performance, operating results, and valuations.

Sources of Liquidity

Our primary sources of liquidity consist of amounts received from: (i) our operating activities, including the fees earned

from our funds, portfolio companies, and capital markets transactions; (ii) realizations on carried interest from our investment

funds; (iii) interest and dividends from investments that generate yield, including our investments in CLOs; (iv) in our

insurance business, cash inflows in respect of new premiums, policyholder deposits, reinsurance transactions, and funding

agreements, including through memberships in FHLBs; (v) realizations on and sales of investments and other assets, including

the transfers of investments or other assets for fund formations (including CLOs and other investment vehicles); and (vi)

borrowings, including advances under our revolving credit facilities, debt offerings, repurchase agreements, and other

borrowing arrangements. In addition, we may generate cash proceeds from issuances of our or our subsidiaries' equity

securities. We have access to funding under various credit facilities, other borrowing arrangements and other sources of

liquidity that we have entered into with major financial institutions or which we receive from the capital markets. For a

discussion of our debt obligations, including our debt securities, revolving credit agreements and loans, see Note 16 "Debt

Obligations" in our financial statements.

Many of our investment funds like our private equity and real assets funds provide for carried interest. With respect to

our carry-paying investment funds, carried interest is eligible to be distributed to the general partner of the fund only after all

of the following are met: (i) a realization event has occurred (e.g., sale of a portfolio company, dividend, etc.); (ii) the vehicle

has achieved positive overall investment returns since its inception, in excess of performance hurdles where applicable, and is

accruing carried interest; and (iii) with respect to investments with a fair value below cost, cost has been returned to fund

investors in an amount sufficient to reduce remaining cost to the investments' fair value. Even after all of the preceding

conditions are met, the general partner of the fund may, in its sole discretion, decide to defer the distribution of carried

interest to it to a later date. In addition, these funds generally include what is called a “clawback” provision, which provides

that the general partner must return any carried interest that is paid in excess of what the general partner is entitled to

receive at the end of the term of the fund, as discussed further below.

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As of December 31, 2025 , certain of our investment funds had met the first and second criteria, as described above, but

did not meet the third criteria. In these cases, carried interest accrues on the consolidated statement of operations, but will

not be distributed in cash to us as the general partner of an investment fund upon a realization event. For a fund that has a

fair value above cost, overall, and is otherwise accruing carried interest, but has one or more investments where fair value is

below cost, the shortfall between cost and fair value for such investments is referred to as a "netting hole." When netting

holes are present, realized gains on individual investments that would otherwise allow the general partner to receive carried

interest distributions are instead used to return invested capital to our funds' limited partners in an amount equal to the

netting hole. Once netting holes have been filled with either (i) return of capital equal to the netting hole for those

investments where fair value is below cost or (ii) increases in the fair value of those investments where fair value is below

cost, then realized carried interest will be distributed to the general partner upon a realization event. A fund that is in a

position to pay cash carry refers to a fund for which carried interest is expected to be paid to the general partner upon the

next material realization event, which includes funds with no netting holes as well as funds with a netting hole that is

sufficiently small in size such that the next material realization event would be expected to result in the payment of carried

interest. Strategic investor partnerships with fund investors may require netting across the various funds in which they invest,

which may reduce the carried interest we otherwise would have earned if such fund investors were to have invested in our

funds without the existence of the strategic investor partnership. As of December 31, 2025 , netting holes in excess of $50

million existed at North America Fund XI in the amount of $417 million. The remaining unrealized gains accrued at this fund as

of December 31, 2025 is in excess of its netting hole. In accordance with the criteria set forth above, other funds currently

have and may in the future develop netting holes, and netting holes for those and other funds may otherwise increase or

decrease in the future.

If the investment fund has distributed carried interest but subsequently does not have sufficient value to provide for the

distribution of carried interest at the end of the life of the investment fund, the general partner is typically required to return

previously distributed carried interest to the fund investors. Current and former employees who received distributions of

carried interest subject to clawback would be required to return the amount of such distributions to KKR. However, it is KKR’s

obligation to return carried interest subject to clawback to the fund investors. As of December 31, 2025 , approximatel y $150

m illion of previously distributed carried interest, in aggregate, was subject to a clawback obligation, assuming that all

applicable carry-paying investment funds were liquidated at their reported fair values as of December 31, 2025 . As of

December 31, 2025 , there are no investment funds subject to a clawback obligation in excess of $50 million that has not

already reduced net realized performance income. See Note 24 "Commitments and Contingencies—Contingent Repayment

Guarantees" in our financial statements included elsewhere in this report for further information. See also the negative

amounts included in the Carried Interest column in the table included in this Item 7 in “Fund Performance Metrics” for further

information on clawback obligations.

Liquidity Needs

We expect that our primary liquidity needs will consist of cash required to meet various obligations, including, without

limitation, to:

• continue to support and grow our asset management business, including seeding new investment strategies,

supporting capital commitments made by our investment vehicles to existing and future funds, co-investments

and otherwise supporting the investment vehicles that we sponsor, and acquiring other assets, businesses, and

investments for our businesses;

• continue to support and grow our insurance business;

• continue to support and grow our strategic holdings business, including through the acquisition of new operating

companies;

• grow and expand our businesses generally, including by acquiring or launching new, complementary, or adjacent

businesses;

• warehouse investments in portfolio companies or other investments for the benefit of one or more of our funds,

accounts or CLOs or other investment vehicles pending the contribution of committed capital by the fund

investors in such investment vehicles, and advancing capital to them for operational or other needs;

• funding requirements to levered investment vehicles or structured transactions;

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• service debt obligations including the payment of obligations at maturity, on interest payment dates or upon

redemption;

• fund cash operating expenses and contingencies, including for litigation matters and guarantees;

• pay corporate income taxes and other taxes;

• pay policyholders and amounts in our insurance business related to investment, reinvestment, reinsurance, or

funding agreement activity;

• pay amounts that may become due under our tax receivable agreement;

• pay cash dividends in accordance with our dividend policy for our common stock or the terms of our preferred

stock;

• underwrite commitments, advance loan proceeds, and fund syndication commitments within our capital

markets business;

• post or return collateral in respect of derivative contracts;

• satisfy regulatory requirements for our capital markets business, risk retention requirements for CLOs (to the

extent they may apply), or to address capital needs of unregulated and regulated subsidiaries, including capital

and collateral requirements, as applicable, for our insurance and broker-dealer subsidiaries; and

• repurchase shares of our common stock or retire equity awards pursuant to the share repurchase program or

repurchase or redeem other securities issued by us (for a discussion of KKR's share repurchase program, see

Note 22 "Equity" in our financial statements).

Capital Commitments

The agreements governing our active investment funds generally require the general partners of the funds to make

minimum capital commitments to such funds, which generally range from 2% to 8% of a fund's total capital commitments at

final closing, but may be greater for certain funds (i) where we are pursuing newer strategies, (ii) where third party investor

demand is limited, and (iii) where a larger commitment is consistent with the asset allocation strategy.

As of December 31, 2025 , KKR had unfunded commitments consisting of $10.5 billion to its investment funds and other

investment vehicles across Private Equity, Real Assets, and Credit and Liquid Strategies business lines. These unfunded

commitments include $2.7 billion of uncalled capital commitments to certain investment vehicles in connection with

investments in the core private equity strategy. These unfunded commitments also include funding requirements to levered

investment vehicles and structured transactions to fund or otherwise be liable for a portion of the vehicle's investment losses

and/or to provide the vehicle with liquidity upon certain termination events.

In addition to these uncalled commitments and funding obligations to KKR's investment funds and investment vehicles,

KKR has entered into contractual commitments primarily with respect to underwriting transactions, debt financing, revolving

credit facilities, and equity syndications in our Capital Markets business line. As of December 31, 2025 , these capital markets

commitments amounted to $1.0 billion . Whether these amounts are actually funded, in whole or in part, depends on the

contractual terms of such capital markets commitments, including the satisfaction or waiver of any conditions to closing or

funding. From time to time, we fund these various capital markets commitments noted above in our capital markets business

by drawing all or substantially all of our availability for borrowings under our available credit facilities available for our Capital

Markets business line. We generally expect these borrowings by our capital markets business to be repaid promptly as these

commitments are syndicated to third parties or otherwise fulfilled or terminated, although we may in some instances elect to

retain a portion of the commitments for our own investment. Additionally, KKR's capital markets business has arrangements

with third parties, which are expected to reduce KKR's risk under certain circumstances when underwriting certain debt

transactions. As a result, our unfunded capital markets commitments as of December 31, 2025 have been reduced to reflect

the amount expected to be funded by such third parties. As of December 31, 2025 , KKR's capital markets business line has

entered into such arrangements representing a total notional amount of $5.0 billion . For more information about our Capital

Markets business line's risks, see "Risk Factors—Risks Related to Our Business—Our capital markets activities expose us to

material risks" in this report.

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Tax Receivable Agreement

On May 30, 2022, KKR terminated the tax receivable agreement with KKR Holdings other than with respect to exchanges

of KKR Holdings equity completed prior to such date. As of December 31, 2025 , an undiscounted payable of $359.3 million has

been recorded in due to affiliates in the financial statements representing management's best estimate of the amounts

currently expected to be owed for certain exchanges of KKR Holdings equity that took place prior to the termination of the tax

receivable agreement. As of December 31, 2025 , $129.4 million of cumulative cash payments have been made under the tax

receivable agreement since inception.

Dividends and Stock Repurchases

A dividend of $0.185 per share of our common stock has been declared and will be paid on March 3, 2026 to holders of

record of our common stock as of the close of business on February 17, 2026 .

A dividend of $0.78125 per share of Series D Mandatory Convertible Preferred Stock has been declared and set aside for

payment on March 1, 2026 to holders of record of Series D Mandatory Convertible Preferred Stock as of the close of business

on February 15, 2026 .

When KKR & Co. Inc. receives distributions from KKR Group Partnership, holders of exchangeable securities receive their

pro rata share of such distributions from KKR Group Partnership.

The declaration and payment of dividends to our common or preferred stockholders will be at the sole discretion of our

Board of Directors, and our dividend policy may be changed at any time. We announced on February 5, 2026 that our current

dividend policy will be to pay dividends to holders of our common stock in an annual aggregate amount of $0.78 per share (or

a quarterly dividend of $0.195 per share) beginning with the dividend announced with the results for the three months ended

March 31, 2026. The declaration of dividends is subject to the discretion of our Board of Directors based on a number of

factors, including KKR’s future financial performance and other considerations that the Board of Directors deems relevant,

and compliance with the terms of KKR & Co. Inc.'s certificate of incorporation and applicable law. For U.S. federal income tax

purposes, any dividends we pay (including dividends on our preferred stock) generally will be treated as qualified dividend

income for U.S. individual stockholders to the extent paid out of our current or accumulated earnings and profits, as

determined for U.S. federal income tax purposes. There can be no assurance that future dividends will be made as intended

or at all or that any particular dividend policy for our common stock or our preferred stock will be maintained. Furthermore,

the declaration and payment of distributions by KKR Group Partnership and our other subsidiaries may also be subject to

legal, contractual and regulatory restrictions, including restrictions contained in our debt agreements.

Since 2015, KKR has repurchased, or retired equity awards representing, a total of 94.2 million shares of common stock

for $2.8 billion , which equates to an average price of $29.36 per share. For further information, see "Part II—Item 5—Market

for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities."

Contractual Obligations, Commitments and Contingencies

In the ordinary course of business, we (including Global Atlantic) and our consolidated funds and CFEs enter into

contractual arrangements that may require future cash payments. Contractual arrangements include (i) commitments to fund

the purchase of investments or other assets (including obligations to fund capital commitments as the general partner of our

investment funds) or to fund collateral for derivative transactions or otherwise, (ii) obligations arising under our senior notes,

subordinated notes, and other indebtedness, (iii) commitments by our capital markets business to underwrite transactions or

to lend capital, (iv) obligations arising under insurance policies written, (v) other contractual obligations, including servicing

agreements with third-party administrators for insurance policy administration, and (vi) commitments to fund the business,

operations or investments of our subsidiaries.  In addition, we may incur contingent liabilities for claims that may be made

against us in the future.  For more information about these contingent liabilities, please see Note 24 "Commitments and

Contingencies" in our financial statements.

The following table sets forth information relating to anticipated future cash payments as of December 31, 2025

excluding consolidated funds and CFEs with a reconciliation of such amounts to anticipated future cash payments by us

(including Global Atlantic) and our consolidated funds and CFEs.

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Payments due by Period

Types of Contractual Obligations

<1 Year

1-3 Years

3-5 Years

>5 Years

Total

($ in millions)

Asset Management

Uncalled commitments to investment funds (1)

Debt payment obligations (2)

Interest obligations on debt payment obligations (3)

Underwriting commitments (4)

Lending commitments (5)

Purchase commitments (6)

Lease obligations

Insurance (7)(8)

Debt payment obligations (9)

Interest obligations on debt payment obligations (10)

Purchase and lease commitments (11)

Total Contractual Obligations of KKR

(+) Uncalled commitments of consolidated funds (12)

(+) Debt payment obligations of consolidated funds, CFEs and Other (13)

(+) Corporate real estate borrowings (14)

(+) Interest obligations of consolidated funds, CFEs and Other (15)

(+) Debt and Interest Payment Obligations of Consolidated Special

Purpose Vehicles - Insurance

Total Consolidated Contractual Obligations

(1) These uncalled commitments represent amounts committed by us to fund a portion of the purchase price paid for each investment made by our

investment funds which are actively investing. Because capital contributions are due on demand, the above commitments have been presented as falling

due within one year. However, given the size of such commitments and the pace at which our investment funds make investments, we expect that the

capital commitments presented above will be called over a period of several years. See "—Liquidity Needs" and Note 16 "Debt Obligations" in our financial

statements.

(2) Amounts include senior notes and subordinated notes issued by KKR and its subsidiaries.

(3) These interest obligations on debt represent estimated interest to be paid over the term of the related debt obligation, which has been calculated

assuming the debt outstanding as of December 31, 2025 is not repaid until its maturity. Future interest rates are assumed to be those in effect as of

December 31, 2025 , including both variable and fixed rates, as applicable, provided for by the relevant debt agreements. The amounts presented above

include accrued interest on outstanding indebtedness.

(4) Represents various commitments in our capital markets business in connection with the underwriting of loans, securities and other financial instruments.

These commitments are shown net of amounts syndicated.

(5) Represents obligations in our capital markets business to lend under various revolving credit facilities.

(6) Represents commitments of KKR's asset management business line to fund the purchase of various investments.

(7) Global Atlantic has other obligations related to collateral payable held for derivative instruments ( $511.5 million ) and outstanding commitments to make

investments in commercial mortgage loans, other lending facilities and other investments ( $7.3 billion ) which have not been included in the above table

as the exact timing of these payments cannot be estimated. Global Atlantic's debt obligations are non-recourse to KKR beyond the assets of Global

Atlantic.

(8) Global Atlantic also has obligations to meet future obligations for policy liabilities. These obligations are subject to variability in amount and timing and as

such include significant assumptions related to the receipt of future premiums, mortality, lapse, renewal, withdrawal, and annuitization activity

comparable with actual experience. These assumptions also include market growth and policy crediting. Estimated cash flows for these obligations with

an expected maturity within the next year, within the next 5 years, and for all years were $21.2 billion, $109.6 billion, and $254.5 billion, respectively,

gross of reinsurance offsets. Due to the significance of the assumptions used, these amounts may differ materially from actual results.

(9) The payments due by period for debt obligations reflect the contractual maturities of principal.

(10) Reflects estimated future interest payments. Future interest on variable rate debt (which includes borrowing under Global Atlantic's revolving credit

facility and the subordinated debentures) was computed using prevailing rates as of December 31, 2025 and, as such, does not consider the impact of

future rate movements. Future interest on fixed rate debt was computed using the stated rate on the obligations.

(11) Reflects operational servicing agreements with third-party administrators for policy administration.

(12) Represents uncalled commitments of our consolidated funds excluding KKR's portion of uncalled commitments as the general partner of the respective

funds. Because capital contributions are due on demand, the above commitments have been presented as falling due within one year. However, given the

size of such commitments and the pace at which our investment funds make investments, we expect that the capital commitments presented above will

be called over a period of several years. See "—Liquidity Needs" and Note 16 "Debt Obligations" in our financial statements.

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(13) Amounts include (i) financing arrangements entered into by our consolidated funds with the objective of providing liquidity to the funds of $6.6 billion,

(ii) debt securities issued by our consolidated CLOs of $30.2 billion and (iii) borrowings collateralized by fund investments, fund co-investments and other

assets held by levered investment vehicles of $3.3 billion . Debt securities issued by consolidated CLO entities are supported solely by the investments held

at the CLO vehicles and are not collateralized by assets of any other KKR entity. Borrowings by levered investment vehicles are supported solely by the

investments held at the investment vehicles and are not collateralized by assets of any other KKR entity. Obligations under financing arrangements

entered into by our consolidated funds are generally limited to our pro rata equity interest in such funds. Our management companies bear no obligations

to repay any financing arrangements at our consolidated funds.

(14) Represents a debt obligation in connection with the ownership of KKR office space.

(15) The interest obligations on debt of our CFEs and other borrowings represent estimated interest to be paid over the term of the related debt obligation,

which has been calculated assuming the debt outstanding as of December 31, 2025 is not repaid until its maturity. Future interest rates are assumed to be

those in effect as of December 31, 2025 , including both variable and fixed rates, as applicable, provided for by the relevant debt agreements. The

amounts presented above include accrued interest on outstanding indebtedness.

The commitment table above excludes contractual amounts owed under the tax receivable agreement because the

ultimate amount and timing of the amounts due are not presently known.

Off Balance Sheet Arrangements

We do not have any off-balance sheet financings or liabilities other than contractual commitments and other legal

contingencies incurred in the normal course of our business.

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Critical Accounting Policies and Estimates

The preparation of our financial statements in accordance with GAAP requires our management to make estimates and

judgments that affect the reported amounts of assets and liabilities, the recognition and disclosure of contingent assets and

liabilities at the date of the financial statements and the reported amounts of revenues, expenses, investment income (loss)

and income taxes during the reporting periods. Such estimates include but are not limited to (i) the valuation of investments

and financial instruments, (ii) the determination of the income tax provision, (iii) the impairment of goodwill and intangible

assets, (iv) the impairment of available-for-sale investments, (v) the valuation of insurance policy liabilities, including market

risk benefits, (vi) the valuation of embedded derivatives in policy liabilities and funds withheld, and (vii) the determination of

the allowance for loan losses. Our management bases these estimates and judgments on available information, historical

experience and other assumptions that we believe are reasonable under the circumstances. However, these estimates,

judgments and assumptions are often subjective and may be impacted negatively based on changing circumstances or

changes in our analyses. If actual amounts are ultimately different from those estimated, judged or assumed, revisions are

included in the financial statements in the period in which the actual amounts become known. We believe our critical

accounting policies could potentially produce materially different results if we were to change underlying estimates,

judgments or assumptions.

For a further discussion about our critical accounting policies, see Note 2 "Summary of Significant Accounting Policies" in

our financial statements included in this report.

Basis of Accounting

We consolidate the financial results of KKR Group Partnership and its consolidated entities, which include the accounts of

our investment advisers, broker-dealers, Global Atlantic’s insurance companies, the general partners of certain

unconsolidated investment funds, general partners of consolidated investment funds and their respective consolidated

investment funds, and certain other entities including CFEs.

When an entity is consolidated, we reflect the accounts of the consolidated entity, including its assets, liabilities,

revenues, expenses, investment income, cash flows, and other amounts, on a gross basis. While the consolidation of an

investment fund or entity does not have an effect on the amounts of Net Income Attributable to KKR or KKR's stockholders'

equity that KKR reports, the consolidation does significantly impact the financial statement presentation under GAAP. This is

due to the fact that the accounts of the consolidated entities are reflected on a gross basis while the allocable share of those

amounts that are attributable to third parties are reflected as single line items. The single line items in which the accounts

attributable to third parties are recorded are presented as noncontrolling interests on the consolidated statements of

financial condition and net income (loss) attributable to noncontrolling interests on the consolidated statements of

operations.

The presentations in the consolidated statement of financial condition and consolidated statement of operations reflect

the significant industry diversification of KKR by its acquisition of Global Atlantic. Global Atlantic operates an insurance

business, and KKR operates an asset management business, which manages the operations of the Strategic Holdings segment

(see Note 21 "Segment Reporting") in our financial statements included in this report, each of which possess distinct

characteristics. As a result, KKR developed a two-tiered approach for the financial statements presentation, where Global

Atlantic's insurance operations are presented separately from KKR's asset management business. KKR believes that these

separate presentations provide a more informative view of the consolidated financial position and results of operations than

traditional aggregated presentations and that reporting Global Atlantic’s insurance operations separately is appropriate given,

among other factors, the relative significance of Global Atlantic’s policy liabilities, which are not obligations of KKR (other than

the insurance companies that issued them). If a traditional aggregate presentation were to be used, KKR would expect to

eliminate or combine several identical or similar captions, which would condense the presentations, but would also reduce

the level of information presented. KKR also believes that using a traditional aggregate presentation would result in no new

line items compared to the two-tier presentation included in the financial statements in this report.

In the ordinary course of business, KKR’s Asset Management, Strategic Holdings, and Insurance businesses enter into

transactions with each other, which may include transactions pursuant to their investment management agreements and

financing arrangements. The borrowings from these financing arrangements are non-recourse to KKR beyond the assets

pledged to support such borrowings. All the investment management and financing arrangements amongst KKR’s Asset

Management, Strategic Holdings, and Insurance businesses are eliminated in consolidation.

All intercompany transactions and balances have been eliminated.

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Consolidation

KKR consolidates all entities that it controls either through a majority voting interest or as the primary beneficiary of

variable interest entities (“VIEs”). The following discussion is intended to provide supplemental information about how the

application of consolidation principles impact our financial results, and management’s process for implementing those

principles including areas of significant judgment. For a detailed description of our accounting policy on consolidation, see

Note 2 "Summary of Significant Accounting Policies" in our financial statements included in this report.

As part of its consolidation procedures, KKR evaluates: (i) whether it holds a variable interest in an entity, (ii) whether the

entity is a VIE, and (iii) whether the KKR’s involvement would make it the primary beneficiary. The determination that KKR

holds a controlling financial interest in an investment vehicle significantly changes the presentation of our consolidated

financial statements.

The assessment of whether we consolidate an investment vehicle we manage requires the application of significant

judgment. These judgments are applied both at the time we become involved with an investment vehicle and on an ongoing

basis and include, but are not limited to:

• Determining whether our management fees, carried interests, or incentive fees represent variable interests - We

make judgments as to whether the fees we earn are commensurate with the level of effort required for those fees

and at market rates. In making this judgment, we consider, among other things, the extent of third party investment

in the entity and the terms of any other interests we hold in the VIE.

• Determining whether a legal entity qualifies as a VIE - For those entities where KKR holds a variable interest,

management determines whether each of these entities qualifies as a VIE and, if so, whether or not KKR is the

primary beneficiary. The assessment of whether the entity is a VIE is generally performed qualitatively, which

requires judgment. These judgments include: (i) determining whether the equity investment at risk is sufficient to

permit the entity to finance its activities without additional subordinated financial support, (ii) evaluating whether

the equity holders, as a group, can make decisions that have a significant effect on the economic performance of the

entity, (iii) determining whether two or more parties’ equity interests should be aggregated, and (iv) determining

whether the equity investors have proportionate voting rights to their obligations to absorb losses or rights to

receive returns from an entity. Entities that do not qualify as VIEs are generally assessed for consolidation as voting

interest entities. Under the voting interest entity model, KKR consolidates those entities it controls through a

majority voting interest.

• Concluding whether KKR has an obligation to absorb losses or the right to receive benefits that could potentially be

significant to the VIE - As there is no explicit threshold in GAAP to define “potentially significant,” we must apply

judgment and evaluate both quantitative and qualitative factors to conclude whether this threshold is met.

Changes to these judgments could result in a change in the consolidation conclusion for a legal entity.

Fair Value Measurements

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction

between market participants at the measurement date under current market conditions. For further information about our

fair value measurements accounting policies, please see “Note 2—Summary of Significant Accounting Policies—Fair Value

Measurements.”

Level III Valuation Methodologies

Our investments and financial instruments are impacted by various economic conditions and events outside of our

control that are difficult to quantify or predict, which may have a significant impact on the valuation of our investments and,

therefore, on the carried interest and investment income we realize.

There is inherent uncertainty involved in the valuation of Level III investments, and there is no assurance that, upon

liquidation, KKR will realize the values reflected in our valuations. Our valuations may differ significantly from the values that

would have been used had an active market for the investments existed, and it is reasonably possible that the difference

could be material. See "Risk Factors" and "—Business Environment" in this report for more information on factors that may

impact our business, financial performance, operating results, and valuations.

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Key unobservable inputs that have a significant impact on our Level III valuations as described above are included in Note

9 "Fair Value Measurements" in our financial statements.

Across the total Level III private equity investment portfolio (including core private equity investments) held directly and

through both consolidated and unconsolidated investment vehicles in our Asset Management segment, the overall weights

ascribed to a market comparables valuation methodology, the discounted cash flow valuation methodology, and a valuation

methodology based on pending sales for this portfolio of Level III private equity investments (including core private equity

investments) were 38%, 55%, and 7% , respectively, as of December 31, 2025.

Across the total Level III real assets investment portfolio held directly and through both consolidated and unconsolidated

investment vehicles in our Asset Management segment, the overall weights ascribed to a market comparables valuation

methodology, the discounted cash flow valuation methodology, the direct income capitalization valuation methodology, and a

valuation methodology based on pending sales for this portfolio of Level III real assets investments were 3%, 91%, 2%, and

4% ,  respectively, as of December 31, 2025.

Level III Valuation Process

The valuation process involved for Level III measurements for our financial statements is completed on a quarterly basis

and is designed to subject the valuation of Level III investments to an appropriate level of consistency, oversight, and review.

For private equity and real asset investments classified as Level III, investment professionals prepare preliminary

valuations based on their evaluation of financial and operating data, company specific developments, market valuations of

comparable companies, and other factors. KKR begins its procedures to determine the fair values of its Level III assets

approximately one month prior to the end of a reporting period, and KKR follows additional procedures to ensure that its

determinations of fair value for its Level III assets are appropriate as of the relevant reporting date. These preliminary

valuations are generally reviewed by an independent valuation firm engaged by KKR to perform certain procedures in order to

assess the reasonableness of KKR's valuations. The valuations of certain real asset investments are determined solely by

independent valuation firms without the preparation of preliminary valuations by our investment professionals, and instead

such independent valuation firms rely on valuation information available to it as a broker or valuation firm. For credit

investments, an independent valuation firm is engaged by KKR to assist with the valuations of most investments classified as

Level III. As of December 31, 2025, less than 5% of the total value of  Level III investments in aggregate across all of our

segments were not valued with the engagement of an independent valuation firm.

For Level III investments, KKR has a Global Valuation Committee that is responsible for coordinating and implementing

the firm's valuation processes to ensure consistency in the application of valuation principles across portfolio investments and

between reporting periods. The Global Valuation Committee is assisted by the asset class-specific valuation committees,

which are responsible for the review and approval of all preliminary Level III valuations in their respective asset classes at least

on a quarterly basis. The members of these valuation committees are comprised of investment professionals and

professionals from business operations functions such as legal, compliance, and finance, who are not primarily responsible for

the management of the investments. All Level III valuations for investments are also subject to approval by the Global

Valuation Committee, which is comprised of senior employees including investment professionals and professionals from

business operations functions, and includes KKR's Chief Financial Officer, Chief Legal Officer and General Counsel, and Chief

Compliance Officer. Once Level III valuations are approved by the Global Valuation Committee, a presentation of such

valuations is provided to the Audit Committee and then to the Board of Directors of KKR & Co. Inc.  Level III valuations for our

insurance segment’s investments are approved by the Global Atlantic Valuation Committee prior to being presented to the

Global Valuation Committee.

As described above, Level III investments were valued using internal models with significant unobservable inputs, and our

determinations of the fair values of these investments may differ materially from the values that would have resulted if

readily observable inputs had existed. Additional external factors may cause those values, and the values of investments for

which readily observable inputs exist, to increase or decrease over time, which may create volatility in our earnings and the

amounts of assets and stockholders' equity that we report from time to time.

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Changes in the fair value of investments impacts the amount of carried interest that is recognized as well as the amount

of investment income that is recognized for investments across our business segments and through our consolidated funds as

described below. We estimate that an immediate 10% decrease  in the fair value of investments held directly and through

consolidated investment funds generally would result in a commensurate change in the amount of net gains (losses) from

investment activities for investments held directly and through investment funds and a more significant impact to the amount

of carried interest recognized, regardless of whether the investment was valued using observable market prices or

management estimates with significant unobservable pricing inputs. With respect to consolidated investment funds, the

impact that the consequential decrease in investment income would have on net income attributable to KKR would generally

be significantly less than the amount described above, given that a majority of the change in fair value of our consolidated

funds would be attributable to noncontrolling interests and therefore we are only impacted to the extent of our carried

interest and our ownership in the consolidated investment funds and investment vehicles.

As of December 31, 2025, upon completion by, where applicable, independent valuation firms of certain limited

procedures requested to be performed by them on certain Level III investments, the independent valuation firms concluded

that the fair values, as determined by KKR (including Global Atlantic), of those investments reviewed by them were

reasonable. The limited procedures did not involve an audit, review, compilation or any other form of examination or

attestation under generally accepted auditing standards and were not conducted on all Level III investments. We are

responsible for determining the fair value of investments in good faith, and the limited procedures performed by an

independent valuation firm are supplementary to the inquiries and procedures that we are required to undertake to

determine the fair value of the commensurate investments on a GAAP basis.

As of December 31, 2025, there were no investments across business segments which represented greater than 5% of

total investments on a GAAP basis. Our investment income on a GAAP and segment basis can be impacted by volatility in the

public markets. See "Risk Factors" and "—Business Environment" in this report for a discussion of factors that may impact the

valuations of our investments, financial results, operating results, and valuations, and "—Segment Balance Sheet Measures"

for additional information regarding our largest holdings on a segment basis.

Business Combinations

KKR accounts for business combinations using the acquisition method of accounting, under which the purchase price of

the acquisition is allocated to the assets acquired and liabilities assumed using the fair values determined by management as

of the acquisition date.

Management’s determination of fair value of assets acquired and liabilities assumed at the acquisition date is based on

the best information available in the circumstances and may incorporate management’s own assumptions and involve a

significant degree of judgment. We use our best estimates and assumptions to accurately assign fair value to the tangible and

identifiable intangible assets acquired and liabilities assumed at the acquisition date as well as the useful lives of those

acquired intangible assets. Examples of critical estimates in valuing certain of the intangible assets we have acquired include,

but are not limited to, future expected cash inflows and outflows, future fundraising assumptions, expected useful life,

discount rates, and income tax rates. Our estimates for future cash flows are based on historical data, various internal

estimates and certain external sources, and are based on assumptions that are consistent with the plans and estimates we are

using to manage the underlying assets acquired. We estimate the useful lives of the intangible assets based on the expected

period over which we anticipate generating economic benefit from the asset. We base our estimates on assumptions we

believe to be reasonable but that are unpredictable and inherently uncertain. Unanticipated events and circumstances may

occur that could affect the accuracy or validity of such assumptions, estimates or actual result.

Income Taxes

Significant judgment is required in estimating the provision for (benefit from) income taxes, current and deferred tax

balances (including valuation allowance), accrued interest or penalties, and uncertain tax positions. In evaluating these

judgments, we consider, among other items, projections of taxable income (including the character of such income),

beginning with historic results and incorporating assumptions of the amount of future pre-tax operating income. These

assumptions about future taxable income require significant judgment and are consistent with the plans and estimates that

KKR uses to manage its business. Revisions in estimates or actual costs of a tax assessment may ultimately be materially

different from the recorded accruals and unrecognized tax benefits, if any. Please see Note 18 "Income Taxes" in our financial

statements in this report for further details.

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Critical Accounting Policies and Estimates – Asset Management and Strategic Holdings

Revenues

Fees and Other

Fees and other consist primarily of (i) management and incentive fees from providing investment management services

to unconsolidated funds, CLOs, other investment vehicles, and separately managed accounts; (ii) transaction fees earned in

connection with successful investment transactions and from capital markets activities; (iii) monitoring fees from providing

services to portfolio companies; (iv) expense reimbursements from certain investment funds and portfolio companies; and

(v) consulting fees. These fees are based on the contractual terms of the governing agreements and are recognized when

earned, which coincides with the period during which the related services are performed and in the case of transaction fees,

upon closing of the transaction. Monitoring fees may provide for a termination payment following an initial public offering or

change of control. These termination payments are recognized in the period when the related transaction closes.

Transaction fee calculations and management fee calculations based on committed capital or invested capital typically do

not require discretion and therefore do not require the use of significant estimates or judgments. Management fee

calculations based on net asset value depend on the fair value of the underlying investments within the investment vehicles.

Estimates and assumptions are made when determining the fair value of the underlying investments within the funds and

could vary depending on the valuation methodology that is used as well as economic conditions.

Capital Allocation-Based Income (Loss)

Capital allocation-based income (loss) is earned from those arrangements whereby KKR serves as general partner and

includes income or loss from KKR's capital interest as well as "carried interest" which entitles KKR to a disproportionate

allocation of investment income or loss from an investment fund's limited partners.

Carried interest is recognized upon appreciation of the funds’ investment values above certain return hurdles set forth in

their partnership agreement. KKR recognizes revenues attributable to capital allocation-based income based upon the amount

that would be due pursuant to the fund partnership agreement at each period end as if the funds were terminated at that

date. Accordingly, the amount recognized reflects KKR’s share of the gains and losses of the associated funds’ underlying

investments measured at their then-current fair values relative to the fair values as of the end of the prior period. Because of

the inherent uncertainty in measuring the fair value of investments in the absence of observable market prices as previously

discussed, these estimated values may differ significantly from the values that would have been used had a ready market for

the investments existed, and it is reasonably possible that the difference could be material.

Expenses

Compensation and Benefits

Compensation and Benefits expense includes (i) base cash compensation consisting of salaries and wages, (ii) benefits,

(iii) carry pool allocations, (iv) equity-based compensation, and (v) discretionary cash bonuses.

Discretionary Cash Bonus

To supplement base cash compensation, benefits, carry pool allocations, and equity-based compensation, we typically

pay discretionary cash bonuses, which are included in Compensation and Benefits expense in the consolidated statements of

operations, based principally on the level of (i) management fees and other fee related revenues (including incentive fees), (ii)

realized performance income, which includes realized carried interest, and (iii) realized investment income earned during the

year. The amounts paid as discretionary cash bonuses, if any, are at our sole discretion and vary from individual to individual

and from period to period, including having no cash bonus. We accrue discretionary cash bonuses when payment becomes

probable and reasonably estimable which is generally in the period when we make the decision to pay discretionary cash

bonuses and is based upon a number of factors, including the recognition of asset management segment revenues, and other

factors determined during the year.

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We expect to pay our employees by assigning a percentage range to each component of asset management segment

revenues. Prior to January 1, 2024, based on the current components and blend of our asset management segment revenues

on an annual basis, we expected to use approximately: (i) 20‐25% of fee related revenues, (ii) 60‐70% of realized carried

interest and incentive fees not included in fee related performance revenues or earned from our hedge fund partnerships,

and (iii) 10‐20% of realized investment income and hedge fund partnership incentive fees, to pay our asset management

employees. Beginning in January 2024, we expect to use approximately: (i) 15%-20% of fee related revenues, (ii) 70%-80% of

realized carried interest and incentive fees not included in fee related performance revenues or earned from our hedge fund

partnerships, and (iii) 10%-20% of realized investment income and hedge fund partnership incentive fees, to pay our asset

management employees. Because these ranges are applied to applicable asset management segment revenue components

independently, and on an annual basis, the amount paid as a percentage of total asset management segment revenue will

vary and will, for example, likely be higher in a period with relatively higher realized carried interest and lower in a period with

relatively lower realized carried interest. We decide whether to pay a discretionary cash bonus and determine the percentage

of applicable revenue components to pay compensation only upon the occurrence of the realization event. There is no

contractual or other binding obligation that requires us to pay a discretionary cash bonus to the asset management

employees, except in limited circumstances.

Carry Pool Allocation

With respect to our funds that provide for carried interest, we allocate a portion of the realized and unrealized carried

interest that we earn to Associates Holdings, which we refer to as the carry pool, from which our asset management

employees and certain other carry pool participants are eligible to receive a carried interest allocation. The allocation is

determined based upon a fixed arrangement between Associates Holdings and us, and we do not exercise discretion on

whether to make an allocation to the carry pool upon a realization event. We refer to the portion of carried interest that we

allocate to the carry pool as the carry pool percentage.

Effective January 2, 2024, KKR applies a carry pool percentage of up to 80% for all funds, which is a carry pool percentage

in excess of the carry pool percentages previously fixed by investment fund as discussed further below, which depended on

the fund’s vintage. This increase to the carry pool percentage was approved by a majority of KKR's independent directors, and

the carry pool percentage may not be increased above 80% without the further approval of a majority of KKR's independent

directors. For funds that closed after December 31, 2023, the carry pool percentage is fixed at 80%. For funds that closed prior

to December 31, 2023, the carry pool percentage is calculated at a fixed percentage of 40%, 43%, or 65% (depending on the

fund’s vintage) for carried interest realized up to a high water mark, which was established based on the unrealized carried

interest balance that existed on January 2, 2024, plus an additional percentage amount up to 80% based on a formulaic

allocation, only if the unrealized carried interest balance at any period end exceeds the high water mark. This imposes a

limitation of the carry pool allocation for such funds based on the amount of cumulative unrealized carried interest income

earned subsequent to December 31, 2023.

For funds that closed before December 31, 2023, if the cumulative carried interest subsequent to December 31, 2023 is

not sufficient to fund this formulaic allocation, the allocation of earnings reverts to the carry pool percentage in effect before

this modification. As such, upon modification of the carry pool percentage effective on January 2, 2024, the cumulative

unrealized carried interest was not sufficient to fund the additional formulaic allocation percentage in excess of the pre-

existing 40%, 43%, and 65% carry pool percentages, and therefore no incremental expense was recognized as of such date.

The carry pool percentage applicable for all funds that closed prior to December 31, 2023 will not be less than their applicable

carry pool percentages of 40%, 43%, or 65% prior to December 31, 2023 (for funds that closed after December 31, 2020 but

before December 31, 2023, the carry pool percentage was fixed at 65%; for funds that closed after June 30, 2017 but before

December 31, 2020, the carry pool percentage was fixed at 43%; and the carry pool percentage was fixed at 40% for older

funds that contributed to KKR's carry pool), and will not be more than 80%. The intent of this modification is that for all funds

that closed prior to January 2, 2024, upon the final liquidation of each fund, realized carried interest distributed will equal the

historical fund carry pool allocations up to the high water mark and only distributions of realized carried interest in excess of

the high water mark will be distributed at 80 percent if and only if the unrealized carried interest balance at any period end

exceeds the high water mark. Under no circumstance would a distribution of carried interest exceed 80% of the total allocable

carried interest at any time.

KKR accounts for the carry pool as a compensatory profit-sharing arrangement in Accrued Expenses and Other Liabilities

within the accompanying consolidated statements of financial condition in conjunction with the related carried interest

income and it is recorded as compensation expense. The liability that is recorded in each period reflects the legal entitlement

of Associates Holdings at each point in time should the total unrealized carried interest be realized at the value recorded at

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each reporting date. Upon a reversal of carried interest income, the related carry pool allocation, if any, is also reversed.

Accordingly, such compensation expense is subject to both positive and negative adjustments.

On the Sunset Date (which will not be later than December 31, 2026), KKR will acquire control of Associates Holdings and

will commence making decisions regarding the allocation of the carry proceeds pursuant to the limited partnership agreement

of Associates Holdings. Until the Sunset Date, our Co-Founders will continue to make decisions regarding the allocation of the

carry proceeds to themselves and others, pursuant to the limited partnership agreement of Associates Holdings, provided that

any allocation of carry proceeds to the Co-Founders will be on a percentage basis consistent with past practice. For additional

information about the Sunset Date and the Reorganization Agreement, see Note 1 "Organization" in our financial statements

included in this report.

Equity-based Compensation

In addition to the cash-based compensation and carry pool allocations as described above, employees receive equity

awards under our Equity Incentive Plan, most of which are subject to service-based vesting typically over a three to five-year

period from the date of grant, and some of which are also subject to the achievement of market-based conditions. Certain of

these awards are subject to post-vesting transfer restrictions and minimum retained ownership requirements.

Compensation expense relating to the issuance of equity-based awards is measured at fair value on the grant date. In

determining the aggregate fair value of any award grants, we make judgments as to the grant-date fair value, particularly for

certain equity awards with a vesting condition based upon market conditions, whose grant date fair values are based on a

probability distributed Monte-Carlo simulation. See Note 19 "Equity-Based Compensation,” in our financial statements

included in this report for further discussion and activity of these awards.

Investment Income (Loss) – Net Gains (Losses) from Investment Activities

Net gains (losses) from investment activities consist of realized and unrealized gains and losses arising from our

investment activities as well as income earned from certain equity method investments. Fluctuations in net gains (losses) from

investment activities between reporting periods is driven primarily by changes in the fair value of our investment portfolio as

well as the realization of investments. The fair value of, as well as the ability to recognize gains from, our investments is

significantly impacted by the global financial markets, which, in turn, affects the net gains (losses) from investment activities

recognized in any given period. Upon the disposition of an investment, previously recognized unrealized gains and losses are

reversed and an offsetting realized gain or loss is recognized in the current period. Since our investments are carried at fair

value, fluctuations between periods could be significant due to changes to the inputs to our valuation process over time. For a

further discussion of our fair value measurements and fair value of investments, see above "—Critical Accounting Policies and

Estimates—Fair Value Measurements."

Critical Accounting Policies and Estimates – Insurance

Policy Liabilities

Policy liabilities, or collectively, “reserves,” are the portion of past premiums or assessments received that are set aside to

meet future policy and contract obligations as they become due. Interest accrues on the reserves and on future premiums,

which may also be available to pay for future obligations. Global Atlantic establishes reserves to pay future policy benefits,

claims, and certain expenses for its life policies and annuity contracts.

Global Atlantic’s reserves are estimated based on models that include many actuarial assumptions and projections. These

assumptions and projections, which are inherently uncertain, involve significant judgment, including assumptions as to the

levels and/or timing of premiums, benefits, claims, expenses, interest credits, investment results (including equity market

returns), mortality, longevity, and persistency.

The assumptions on which reserves are based are intended to represent an estimation of experience for the period that

policy benefits are payable. Global Atlantic reviews the adequacy of its reserves and the assumptions underlying those

reserves at least annually. Global Atlantic cannot, however, determine with precision the amount or the timing of actual

benefit payments. If actual experience is better than or equal to the assumptions, then reserves would be adequate to

provide for future benefits and expenses. If experience is worse than the assumptions, additional reserves may be required to

meet future policy and contract obligations. This would result in a charge to Global Atlantic's net income during the period in

which excess benefits are paid or an increase in reserves occurs.

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For a majority of Global Atlantic’s in-force policies, including its interest-sensitive life policies and most annuity contracts,

the base policy reserve is equal to the account value. For these products, the account value represents Global Atlantic’s

obligation to repay to the policyholder the amounts held with Global Atlantic on deposit. However, there are several

significant blocks of business where policy reserves, in addition to the account value, are explicitly calculated, including

variable annuities, fixed-indexed annuities, interest-sensitive life products (including those with secondary guarantees), and

preneed policies.

Market Risk Benefits

Market risk benefits are contracts or contract features that both provide protection to the policyholder from other-than-

nominal capital market risk and expose Global Atlantic to other-than-nominal capital market risk. Market risk benefits include

certain contract features on fixed annuity and variable annuity products, including minimum guarantees to policyholders,

such as guaranteed minimum death benefits ("GMDBs"), guaranteed minimum withdrawal benefits ("GMWBs"), and long-

term care benefits (which are capped at the return of account value plus one or two times the account value).

Some of Global Atlantic's variable annuity and fixed-indexed annuity contracts contain a GMDB feature that provides a

guarantee that the benefit received at death will be no less than a prescribed minimum amount, even if the account balance

is reduced to zero. This amount is based on either the net deposits paid into the contract, the net deposits accumulated at a

specified rate, the highest historical account value on a contract anniversary, or sometimes a combination of these values. If

the GMDB is higher than the current account value at the time of death, Global Atlantic incurs a cost equal to the difference.

Global Atlantic issues fixed-indexed annuity and variable annuity contracts with a guaranteed minimum withdrawal

feature. GMWB are an optional benefit where the contract owner is entitled to withdraw a maximum amount of their benefit

base each year.

Once exercised, living benefit features provide annuity policyholders with a minimum guaranteed stream of income for

life. A policyholder’s annual income benefit is generally based on an annual withdrawal percentage multiplied by the benefit

base. The benefit base is defined in the policy and is generally the initial premium, reduced by any partial withdrawals and

increased by a defined percentage, formula, or index credits. Any living benefit payments are first deducted from the account

value. Global Atlantic is responsible for paying any excess guaranteed living benefits still owed after the account value has

reached zero.

The ultimate cost of these benefits will depend on the level of market returns and the level of contractual guarantees, as

well as policyholder behavior, including surrenders, withdrawals, and benefit utilization. For Global Atlantic's fixed-indexed

annuity products, costs also include certain non-guaranteed terms that impact the ultimate cost, such as caps on crediting

rates that Global Atlantic can, in its discretion, reset annually.

See Note 17 “Policy Liabilities” in our financial statements for additional information.

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As of December 31, 2025 , the net market risk liability balance totaled $1.3 billion . As of December 31, 2025 , the liability

balances for market risk benefits were $1.1 billion for fixed-indexed annuities and $197.5 million for variable and other

annuities. The increase (decrease) to the net market risk benefit liability balance as a result of hypothetical changes in interest

rates, instrument-specific credit risk, equity market prices, expected mortality, and expected surrenders are summarized in

the table below. This sensitivity considers the direct effect of such changes only and not changes in any other assumptions

used in or items considered in the measurement of such balances.

As of December 31, 2025

($ in thousands)

Fixed-Indexed Annuity

Other

Balance

Hypothetical Change:

+50 bps Interest Rates

-50 bps Interest Rates

+50 bps Instrument-specific Credit Risk

-50 bps Instrument-specific Credit Risk

+10% Equity Market Prices

-10% Equity Market Prices

95% of Expected Mortality

105% of Expected Mortality

90% of Expected Surrenders

110% of Expected Surrenders

Note: Hypothetical changes to the market risk benefits liability balance do not reflect the impact of related hedges.

Policy Liabilities Accounted for Under a Fair Value Option

Variable annuity contracts offered and assumed by Global Atlantic provide the contractholder with a GMDB. The liabilities

for these benefits are included in policy liabilities. Global Atlantic elected the fair value option to measure the liability for

certain of these variable annuity contracts valued at $258.8 million as of December 31, 2025 . Fair value is calculated as the

present value of the estimated death benefits less the present value of the GMDB fees, using 1,000 risk neutral scenarios.

Global Atlantic discounts the cash flows using the U.S. Treasury rates plus an adjustment for instrument-specific credit risk in

the consolidated statement of financial condition. The change in the liabilities for these benefits is included in policy benefits

and claims in the consolidated statement of operations.

As of December 31, 2025 , variable annuities accounted for using the fair value option totaled $258.8 million . The increase

(decrease) in the reserves for variable annuities accounted for using the fair value option as a result of hypothetical changes in

interest rates, instrument-specific credit risk, equity market prices, expected mortality, and expected surrenders are

summarized in the table below. This sensitivity considers the direct effect of such changes only and not changes in any other

assumptions used in or items considered in the measurement of such balances.

As of December 31,

($ in thousands)

Variable Annuities

Balance

Hypothetical Change:

+50 bps Interest Rates

-50 bps Interest Rates

+50 bps Instrument-specific Credit Risk

-50 bps Instrument-specific Credit Risk

+10% Equity Market Prices

-10% Equity Market Prices

95% of Expected Mortality

105% of Expected Mortality

90% of Expected Surrenders

110% of Expected Surrenders

Note: Hypothetical changes to the liability balances do not reflect the impact of related hedges.

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Liability for Future Policyholder Benefits

A liability for future policy benefits, which is the present value of estimated future policy benefits to be paid to or on

behalf of policyholders and certain related expenses less the present value of estimated future net premiums to be collected

from policyholders, is accrued as premium revenue is recognized. The liability is estimated using current assumptions that

include mortality, morbidity, lapses, and expenses. These current assumptions are based on judgments that consider Global

Atlantic’s historical experience, industry data, and other factors, and are updated quarterly and the current period change in

the liability is recognized as a separate component of benefit expense in the consolidated income statement.

As of December 31, 2025 , the liability for future policy benefits totaled $14.3 billion , net of reinsurance, split between

$12.4 billion associated with payout annuity products, and $1.9 billion of life and other insurance products (including assumed

long-term care insurance where Global Atlantic retroceded mortality and morbidity risks to a third-party reinsurer). The

increase (decrease) as a result of hypothetical changes in interest rates, credit spreads, expected mortality, and expected

surrenders and lapses are summarized in the table below. This sensitivity considers the direct effect of such changes only and

not changes in any other assumptions used in or items considered in the measurement of such balances.

As of December 31, 2025

($ in thousands)

Payout Annuities

Other

Balance

Hypothetical Change:

+50 bps Interest Rates

-50 bps Interest Rates

+50 bps Credit Spreads

-50 bps Credit Spreads

95% of Expected Mortality (1)

105% of Expected Mortality (1)

90% of Expected Surrenders/Lapses

110% of Expected Surrenders/Lapses

Note: Hypothetical changes to the liability for future policy benefits balance do not reflect the impact of related hedges.

(1) Includes decrements for terminations of disability insurance.

Additional Liability for Annuitization, Death, or Other Insurance Benefits: No-Lapse Guarantees

Global Atlantic has in-force interest-sensitive life contracts where it provides a secondary guarantee to the policyholder.

The policy can remain in-force, even if the base policy account value is zero, as long as contractual secondary guarantee

requirements have been met. The primary risk to Global Atlantic is that the premium collected under these policies, together

with the investment return Global Atlantic earns on that premium, is ultimately insufficient to pay the policyholder’s benefits

and the expenses associated with issuing and administering these policies. Global Atlantic holds an additional reserve in

connection with these guarantees.

The additional reserves related to interest-sensitive life products with secondary guarantees are calculated using

methods similar to those described above under “—Critical Accounting Policies and Estimates – Insurance—Policy Liabilities—

Market Risk Benefits.” The costs related to these secondary guarantees are recognized over the life of the contracts through

the accrual and subsequent release of a reserve which is revalued each period. The reserve is calculated based on

assessments, over a range of economic scenarios to incorporate the variability in the obligation that may occur under

different environments. The change in the reserve is included in policy benefits and claims in the consolidated statements of

operations.

As of December 31, 2025 , the additional liability balance of primarily interest-sensitive life totaled $6.2 billion , net of

reinsurance. The increase (decrease) to the additional liability balance, as a result of hypothetical changes in interest rates,

equity market prices, annual equity growth, expected mortality, and expected surrenders are summarized in the table below.

This sensitivity considers the direct effect of such changes only and not changes in any other assumptions used in or items

considered in the measurement of the interest-sensitive life no-lapse guarantee liability balance.

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As of December 31,

($ in thousands)

Interest-Sensitive Life

Balance

Hypothetical Change:

+50 bps Interest Rates

-50 bps Interest Rates

+10% Equity Market Prices

-10% Equity Market Prices

1% Lower Annual Equity Growth

95% of Expected Mortality

105% of Expected Mortality

90% of Expected Surrenders

110% of Expected Surrenders

Note: Hypothetical changes to the interest-sensitive life additional liability for annuitization, death, or other insurance benefits balance do not reflect the

impact of related hedges.

Embedded Derivatives in Policy Liabilities and Funds Withheld

Global Atlantic's fixed-indexed annuity, variable annuity, and indexed universal life products contain equity-indexed

features, which are considered embedded derivatives and are required to be measured at fair value.

Global Atlantic calculates the embedded derivative as the present value of future projected benefits in excess of the

projected guaranteed benefits, using an option budget as the indexed account value growth rate. In addition, the fair value of

the embedded derivative is reduced to reflect instrument specific credit risk on Global Atlantic's obligation (that is, Global

Atlantic's own credit risk).

Changes in interest rates, future index credits, instrument-specific credit risk, projected withdrawal and surrender

activity, and mortality on fixed-indexed annuity and interest-sensitive life products can have a significant impact on the value

of the embedded derivative.

Valuation of Embedded Derivatives – Fixed-Indexed Annuities

Fixed-indexed annuity contracts allow the policyholder to elect a fixed interest rate of return or a market indexed strategy

where interest credited is based on the performance of an index, such as the S&P 500 Index, or other indexes. The market

indexed strategy is an embedded derivative, similar to a call option. The fair value of the embedded derivative is computed as

the present value of benefits attributable to the excess of the projected policy contract values over the projected minimum

guaranteed contract values. The projections of policy contract values are based on assumptions for future policy growth,

which include assumptions for expected index credits, future equity option costs, volatility, interest rates, and policyholder

behavior. The projections of minimum guaranteed contract values include the same assumptions for policyholder behavior as

are used to project policy contract values. The embedded derivative cash flows are discounted using a risk-free interest rate

increased by instrument-specific credit risk tied to Global Atlantic's own credit rating.

Valuation of Embedded Derivatives – Interest-Sensitive Life Products

Interest-sensitive life products allow a policyholder’s account value to grow based on the performance of certain equity

indexes, which results in an embedded derivative similar to a call option. The embedded derivative related to the index is

bifurcated from the host contract and measured at fair value. The valuation of the embedded derivative is the present value

of future projected benefits in excess of the projected guaranteed benefits, using the option budget as the indexed account

value growth rate and the guaranteed interest rate as the guaranteed account value growth rate. Present values are based on

discount rate curves determined at the valuation date or issue date as well as assumed lapse and mortality rates. The discount

rate equals the forecast treasury rate increased by instrument-specific credit risk tied to Global Atlantic’s own credit rating.

Changes in discount rates and other assumptions such as spreads and/or option budgets can have a substantial impact on the

embedded derivative.

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Valuation of Embedded Derivatives in Modified Coinsurance or Funds Withheld

Global Atlantic's reinsurance agreements include modified coinsurance and coinsurance with funds withheld

arrangements that include terms that require payment by the ceding company of a principal amount plus a return that is

based on a proportion of the ceding company’s return on a designated portfolio of assets. Because the return on the funds

withheld receivable or payable is not clearly and closely related to the host insurance contract, these contracts are deemed to

contain embedded derivatives, which are measured at fair value. Global Atlantic is exposed to both the interest rate and

credit risk of the assets. Changes in discount rates and other assumptions can have a significant impact on this embedded

derivative. The fair value of the embedded derivatives is included in the funds withheld receivable at interest and funds

withheld payable at interest line items on our consolidated statement of financial condition. The change in the fair value of

the embedded derivatives is recorded in net investment-related gains (losses) in the consolidated statement of operations.

As of December 31, 2025 , the embedded derivative liability balance totaled $7.4 billion for fixed-indexed annuities, and

$485.0 million for interest-sensitive life. The increase (decrease) to the embedded derivatives on fixed-indexed annuity and

indexed universal life as a result of hypothetical changes in interest rates, credit spreads, and equity market prices are

summarized in the table below. This sensitivity considers the direct effect of such changes only and not changes in any other

assumptions used in or items considered in the measurement of such balances.

As of December 31, 2025

($ in thousands)

Fixed-Indexed

Annuities

Interest Sensitive Life

Balance

Hypothetical Change:

+50 bps Interest Rates

-50 bps Interest Rates

+50 bps Credit Spreads

-50 bps Credit Spreads

+10% Equity Market Prices

-10% Equity Market Prices

Note: Hypothetical changes to the market risk benefits liability balance do not reflect the impact of related hedges.

As of December 31, 2025 , the embedded derivative balance for modified coinsurance or funds withheld arrangements

was a $2.4 billion net asset ( $78.9 million in funds withheld receivables at interest, and $(2.3) billion in funds withheld payable

at interest). The increase (decrease) to the embedded derivatives on fixed-indexed annuity and interest-sensitive life products

as a result of hypothetical changes in interest rates and investment credit spreads are summarized in the table below. This

sensitivity considers the direct effect of such changes only and not changes in any other assumptions used in or items

considered in the measurement of such balances.

As of December 31, 2025

($ in thousands)

Embedded Derivative

on Funds Withheld

Receivable

Embedded Derivative

on Funds Withheld

Payable

Balance

Hypothetical Change:

+50 bps Interest Rates

-50 bps Interest Rates

+50 bps Investment Credit Spreads

-50 bps Investment Credit Spreads

Note: Hypothetical changes to the funds withheld receivable and payable embedded derivative balances do not reflect the impact of related hedges or trading

assets which back the funds withheld at interest.

Recently Issued Accounting Pronouncements

For a full discussion of recently issued accounting pronouncements, see Note 2 "Summary of Significant Accounting

Policies" in our financial statements included in this report.

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