KKR & Co. Inc. (KKR) Risk Factors

Verbatim Item 1A Risk Factors from KKR & Co. Inc.'s latest 10-K. Filing date: 2026-02-27. Accession: 0001404912-26-000007.

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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

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.

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

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,

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

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.

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

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.

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-

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

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

us.

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

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

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

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

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.

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, improper 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

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

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.

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.

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

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

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

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.”

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”.

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”.

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.

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”.

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

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.

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.

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;

•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.

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.

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;

•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;

•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

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

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.

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

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

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;

•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

us.

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.

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.

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

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

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

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

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)

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.

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

us.

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.

KKR & Co. Inc. (KKR) Risk Factors

ITEM 1A. RISK FACTORS

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.

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

disasters, could materially and adversely impact KKR.

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

retain, and motivate our employees whom we depend.

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

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

which may materially adversely affect our business”.

materially and adversely affect our business.

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

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

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

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Related to our Insurance Activities.”

Our capital markets activities expose us to material risks.

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

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

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

other assumptions, may differ materially from actual outcomes.

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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.

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

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

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

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

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and transactions could materially and adversely affect us.

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

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

may decrease as predecessor funds mature and associated fees decrease.

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

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

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

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

regulatory requirements and other risks.

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

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

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

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

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affect KKR.”

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

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

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

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

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

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

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We are subject to focus by certain stakeholders on sustainability matters.

the foregoing could have a material and adverse impact on us, including on our reputation.

Risks Related to Regulatory Matters

applicable laws may materially and adversely affect us.

and regulations, could materially and adversely affect our business, results of operations, and financial condition.

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of these actions or consequences could materially and adversely affect us.

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limit products we offer, impede fundraising, restrict transaction activity, or otherwise materially adversely affect our business.

the application of enhanced group-level regulation, may materially adversely affect us.

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systemically important financial institutions, which could subject a designated entity to enhanced supervision and regulation.

third-party claims, or other otherwise materially and adversely affect our business.

circumstances depend on compliance by third parties or factual determinations that may be outside of our control.

and could materially and adversely affect our financial results and results of operations.