Exhibit 10.1


 


AMENDED AND RESTATED EXCHANGE AGREEMENT


 


AMENDED
AND RESTATED EXCHANGE AGREEMENT (the “Agreement”), dated as of  November 2,
2010, among KKR Management Holdings L.P., KKR Fund Holdings L.P., KKR Holdings
L.P., KKR & Co. L.P., KKR Group Holdings L.P., KKR Subsidiary
Partnership L.P. and KKR Group Limited.


 


WHEREAS,
the original Exchange Agreement among KKR Management Holdings L.P., KKR Fund
Holdings L.P., KKR Holdings L.P. and KKR & Co. L.P. was executed as of
July 14, 2010 (the “Original Exchange Agreement”) in order to
provide the parties with certain rights and obligations with respect to the
exchange of certain Group Partnership Units for Common Units by certain
persons;


 


WHEREAS,
the parties to the Original Exchange Agreement together with KKR Group Holdings
L.P. and KKR Group Limited now desire to enter into this Agreement to amend and
restate the Original Exchange Agreement in its entirety as more fully set forth
below;


 


WHEREAS,
the right to exchange Group Partnership Units set forth in Section 2.1(a) below,
once exercised, represents a several, and not a joint and several, obligation
of the Group Partnerships (on a pro rata
basis), and no Group Partnership shall have any obligation or right to acquire
Group Partnership Units issued by another Group Partnership;


 


NOW,
THEREFORE, in consideration of the mutual covenants and undertakings contained
herein and for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto hereby agree as follows:


 


ARTICLE I.


DEFINITIONS


 


Section 1.1                                      Definitions.


 


The
following definitions shall be for all purposes, unless otherwise clearly
indicated to the contrary, applied to the terms used in this Agreement.


 


“Agreement”
has the meaning set forth in the preamble of this Agreement.


 


“Base
Exchange” has the meaning set forth in Section 2.1(a)(i) of this
Agreement.


 


“Business
Day” means each day that is not a Saturday, Sunday or other day on which
banking institutions in New York, New York are authorized or required by law to
close.


 


“Charitable
Exchange” means a direct or indirect exchange of Group Partnership Units
pursuant to this Agreement by a KKR Holdings Affiliated Person for the purpose of making a gratuitous
transfer of any Common Units received in the exchange to a Charity.


 

















 


“Charity”
means any organization that is organized and operated for a purpose described
in Section 170(c) of the Code (determined without reference to Section 170(c)(2)(A) of
the Code) and described in Sections 2055(a) and 2522 of the Code.


 


“Code”
means the Internal Revenue Code of 1986, as amended.


 


“Common
Unit” means a partnership interest in the Issuer representing a fractional
part of the partnership interests in the Issuer of all limited partners of the
Issuer having the rights and obligations specified with respect to Common Units
in the Issuer Partnership Agreement.


 


“Corporate
Holdco” means a corporation (or other entity classified as a corporation
for United States federal income tax purposes) that (i) is wholly owned by
a KKR Holdings Affiliated Person, (ii) owns solely Group Partnership I
Units, (iii) was formed solely for the purpose of owning such Group
Partnership I Units, and (iv) has never owned any assets other than Group
Partnership I Units or engaged in any other business, or such other corporation
designated a Corporate Holdco by a Group Partnership General Partner.


 


“Delaware
Arbitration Act” has the meaning set forth in Section 3.8(c).


 


“Exchange”
means a Charitable Exchange, a Non-U.S. Exchange or a Base Exchange, as the
case may be.


 


“Exchange
Rate” means the number of Common Units for which a Group Partnership Unit
is entitled to be exchanged.  On the date of this Agreement, the Exchange
Rate shall be 1 for 1, which Exchange Rate shall be subject to modification as
provided in Section 2.4.


 


“Fair
Market Value” means, as of a given time, (i) if Common Units are
traded on a securities exchange, then the volume-weighted average price of a
Common Unit based on the trades during the most recent completed trading day as
reported by the principal securities exchange on which Common Units are traded
and (ii) if Common Units are not traded on a securities exchange, the fair
market value of such asset as reasonably determined by the conflicts committee
of the board of directors of the Issuer General Partner.


 


“General
Exchange” means an Exchange in respect of a General Notice Date.


 


“General
Quarterly Exchange Date” means, unless the Issuer cancels such Quarterly
Exchange Date pursuant to either Section 2.2(c) or 2.9 hereof, the
date set by the Issuer General Partner that is (i) at least 60 days after
the General Notice Date in respect of that Quarter and (ii) (unless
otherwise required by Section 409A of the Code) no earlier than the first
day following the end of the Quarter that is immediately prior to the day that
employees of the Issuer General Partner or the Issuer’s Subsidiaries would be
permitted to trade under the Issuer’s Insider Trading Policy.


 


“General
Notice Date” means, with respect to each Quarter, the date set by the
Issuer General Partner by which KKR Holdings or a KKR Holdings Affiliated
Person is required to provide notice of an Exchange for that Quarter.


 


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“Group
Partnership I” means KKR Management Holdings L.P., a Delaware limited
partnership, and any successor thereto.


 


“Group
Partnership I General Partner” means KKR Management Holdings Corp., and any
successor thereto.


 


“Group
Partnership I Units” means the Class A partnership units of Group
Partnership I (and partnership units of any subsequently formed Group
Partnership whose interests are held by the Issuer through a Group Partnership
Holdco).


 


“Group
Partnership II” means KKR Fund Holdings L.P., a Cayman limited partnership,
and any successor thereto.


 


“Group
Partnership II Units” means the Class A partnership units of Group
Partnership II (and partnership units of any subsequently formed Group
Partnership whose interests the Issuer holds directly or indirectly through
entities that are transparent for U.S. federal income tax purposes).


 


“Group
Partnership Agreements” means, collectively, the Amended and Restated
Limited Partnership Agreement of Group Partnership I and the Amended and
Restated Limited Partnership Agreement of Group Partnership II (and the
partnership agreement then in effect of any future partnership designated as a
Group Partnership), as each may be amended, supplemented or restated from time
to time.


 


“Group
Partnership General Partners” means Group Partnership I General Partner and
KKR Group Holdings L.P., and any successor thereto (and the general partner of
any future partnership designated as a Group Partnership).


 


“Group
Partnership Holdco” means Group Partnership I General Partner (and any
future entity that is classified as an association taxable as a corporation for
U.S. federal income tax purposes, is directly or indirectly owned by the Issuer
and formed for the purposes of holding partnership units of a Group
Partnership).


 


“Group
Partnership Unit” means, collectively, one partnership unit in each of
Group Partnership I and Group Partnership II (and any future partnership
designated as a Group Partnership) issued under its respective Group
Partnership Agreement.


 


“Group
Partnerships” means, collectively, Group Partnership I and Group
Partnership II (and any future partnership designated as a Group Partnership).


 


“Issuer”
means KKR & Co. L.P., a Delaware limited partnership, and any
successor thereto.


 


“Issuer
General Partner” means KKR Management LLC, a Delaware limited partnership,
and any successor thereto.


 


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“Insider
Trading Policy” means the insider trading policy of the Issuer applicable
to the employees of the Issuer General Partner or the Issuer’s Subsidiaries, as
such insider trading policy may be amended, supplemented or restated from time
to time.


 


“Issuer
Partnership Agreement” means the Amended and Restated Agreement of Limited
Partnership of the Issuer, dated July 14, 2010, as such agreement of
limited partnership may be amended, supplemented or restated from time to time.


 


“KKR
Group Holdings” means KKR Group Holdings L.P., a limited partnership formed
under the laws of the Cayman Islands, and any successor thereto.


 


“KKR
Holdings” means KKR Holdings L.P., a limited partnership formed under the
laws of the Cayman Islands, and any successor thereto, and its Subsidiaries.


 


“KKR
Holdings Affiliated Person” means each Person that is as of the date of
this Agreement or becomes from time to time (i) a general partner or a
limited partner of KKR Holdings pursuant to the terms of the KKR Holdings
Partnership Agreement or (ii) a general partner, limited partner or holder
of any other type of equity interest of any Person included in clause (i) above.


 


“KKR
Holdings Partnership Agreement” means the Amended and Restated Limited
Partnership Agreement of KKR Holdings, as amended, supplemented or restated
from time to time.


 


“Non-U.S.
Exchange” means a direct or indirect exchange of Group Partnership Units
pursuant to this Agreement by a Non-U.S. KKR Holdings Affiliated Person.


 


“Non-U.S.
KKR Holdings Affiliated Person” means a KKR Holdings Affiliated Person that
is not (i) an individual citizen or resident of the United States, (ii) a
corporation (or other entity classified as a corporation for United States
federal income tax purposes) created or organized in or under the laws of the
United States (or any political subdivision thereof), or (iii) a
partnership (or other entity classified as a partnership for United States
federal income tax purposes) created or organized in or under the laws of the
United States (or any political subdivision thereof) or that has at least one
partner who is an individual citizen or resident of the United States; provided
that a partnership (or other entity classified as a partnership for United
States federal income tax purposes) created or organized in or under the laws
of the United States (or any political subdivision thereof) to which a Person
who is a Non-U.S. KKR Holdings Affiliated Person has transferred interests in
KKR Holdings prior to an Exchange shall be treated as a Non-U.S. KKR Holdings
Affiliated Person.


 


“Notice
Date” means, with respect to each Quarter, either an REU Notice Date and/or
a General Notice Date, as the context may require.


 


“Person”
means an individual, corporation, limited liability company, partnership, joint
venture, trust, estate, unincorporated organization, association (including any
group, organization, co-tenancy, plan, board, council or committee), government
(including a country, state, county, or any other governmental or political
subdivision, agency or instrumentality thereof) or other entity (or series
thereof).


 


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“Public
Offering” means a public offering of Common Units pursuant to an effective
registration statement under the Securities Act, other than pursuant to a
registration statement on Form S-4 or Form S-8 or any similar or
successor form.


 


“Quarter”
means, unless the context requires otherwise, a fiscal quarter of the Issuer.


 


“Quarterly
Exchange Date” means, with respect to each Quarter, either an REU Quarterly
Exchange Date and/or a General Quarterly Exchange Date, as the context may
require.


 


“REU
Exchange” means an Exchange in respect of an REU Notice Date.


 


“REU
Quarterly Exchange Date” means, unless the Issuer cancels such Quarterly
Exchange Date pursuant to either Section 2.2(c) or 2.9 hereof, the
date set by the Issuer General Partner that is (i) at least 60 days after
the REU Notice Date in respect of that Quarter and (ii) (unless otherwise
required by Section 409A of the Code) no earlier than the first day
following the end of the Quarter that is immediately prior to the day that
employees of the Issuer General Partner 
or the Issuer’s Subsidiaries would be permitted to trade under the
Issuer’s Insider Trading Policy.


 


“REU
Notice Date” means with respect to each Quarter, the date set by the Issuer
General Partner by which KKR Holdings is required to provide notice of an
Exchange for that Quarter to satisfy its expected obligation on the REU Notice
Date to provide Common Units on the REU Quarterly Exchange Date to holders of
restricted equity units under the KKR Holdings L.P. Equity Plan.


 


“Sale
Period” has the meaning set forth in Section 2.8 of this Agreement.


 


“Sale
Transaction” has the meaning set forth in Section 2.9 of this
Agreement.


 


“Subsidiaries”
means any corporation, partnership, joint venture or other legal entity of
which KKR Holdings (either alone or through or together with any other
subsidiary), owns, directly or indirectly, 50% or more of the stock or other
equity interests.


 


“Subsidiary
Partnership” means KKR Subsidiary Partnership L.P., a limited partnership
organized under the laws of Delaware.


 


“Transfer
Agent” means such bank, trust company or other Person as shall be appointed
from time to time by the Issuer pursuant to the Issuer Partnership Agreement to
act as registrar and transfer agent for the Common Units.


 


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ARTICLE II.

EXCHANGE OF GROUP PARTNERSHIP UNITS


 


Section 2.1                                      Exchange of Group Partnership Units.


 


(a)                                  Subject to the
provisions of the Group Partnership Agreements and the Issuer Partnership
Agreement and to the provisions of Section 2.2 hereof, KKR Holdings or a KKR Holdings Affiliated Person shall
be entitled on any General Quarterly Exchange Date, and KKR Holdings shall be
entitled on any REU Quarterly Exchange Date, to surrender Group Partnership
Units held by KKR Holdings or a KKR
Holdings Affiliated Person as follows:


 


(i)                                     KKR Holdings or
a KKR Holdings Affiliated Person
may surrender Group Partnership Units to the Group Partnerships in exchange for
either (at the option of the Group Partnerships) (x) the delivery on a pro rata basis (determined by reference to the relative fair
market values of the Group Partnership I Units and Group Partnership II Units)
by the Group Partnerships of a number of Common Units (acquired from the
Issuer) equal to the number of Group Partnership Units surrendered multiplied
by the Exchange Rate or (y) cash in an amount equal to the Fair Market
Value on the date of such exchange of the Common Units that KKR Holdings or a KKR Holdings Affiliated Person would
receive pursuant to clause (x) (any such exchange, a “Base Exchange”).  Simultaneous
with any such Exchange pursuant to clause (x) above, Group Partnership I
Units shall be issued to Group Partnership Holdco and Group Partnership II
Units shall be issued to Subsidiary Partnership in an amount equal to the
number of Group Partnership I Units or Group Partnership II Units surrendered
to each such Group Partnership.  Any
election by the Group Partnerships to deliver cash to KKR Holdings or a KKR
Holdings Affiliated Person, as the case may be, pursuant to clause (y) above,
shall be subject to the prior approval of the conflicts committee of the board
of directors of the Issuer General Partner.


 


(ii)                                  For purposes of making a Charitable Exchange or a Non-U.S. Exchange, a
KKR Holdings Affiliated Person may surrender Group Partnership Units to the
Issuer in exchange for the delivery of a number of Common Units equal to the
number of Group Partnership Units surrendered multiplied by the Exchange
Rate, provided, however, the Issuer may instead require that the
Group Partnership I units the KKR Holdings Affiliated Person intends to
surrender be owned by one or more Corporate Holdcos prior to surrender, in
which case the number of Common Units delivered pursuant to the Exchange will
be equal to the total Group Partnership Units that are surrendered, taking into
account those collectively owned by the Corporate Holdcos whose interest are
surrendered, multiplied by the Exchange Rate.


 


(b)                                 In connection with any Charitable Exchange or Non-U.S. Exchange pursuant
to Section 2.1(a)(ii) above, the Issuer shall direct that (i) any
Group Partnership I Units or interests in Corporate Holdcos surrendered
pursuant to such Exchange be transferred or issued directly to the Group
Partnership Holdco that currently holds interests in the issuer of such Group
Partnership I Units or that are held by such Corporate Holdco, and (ii) any
Group Partnership II Units be transferred or issued directly to KKR Group
Holdings or to the general partner of the issuer of such Group Partnership II
Units surrendered.


 


(c)                                  Where KKR Holdings
or a KKR Holdings Affiliated Person
has exercised its right to surrender its Group Partnership Units to the Group
Partnerships in a Base Exchange,  Group
Partnership Holdco (with respect to Group Partnership I Units ) and Subsidiary
Partnership (with respect to Group Partnership II Units), shall have a
superseding right to acquire 


 


6

















 


such interests for an amount of cash or Common Units
equal to the amount of cash or Common Units (provided by the Issuer) that would
be received pursuant to the Base Exchange.


 


(d)                                 On the date the
Exchange of the Group Partnership Units is effective, all rights of KKR
Holdings or a KKR Holdings Affiliated
Person as holder of such Group Partnership Units shall cease, and KKR Holdings
or such KKR Holdings Affiliated Person
shall be treated for all purposes as having become the Record Holder (as
defined in the Issuer Partnership Agreement) of the Common Units which are the
subject of the Exchange and shall be admitted as a Limited Partner (as defined
in the Issuer Partnership Agreement) of the Issuer in accordance and upon
compliance with Section 10.2 of the Issuer Partnership Agreement.


 


(e)                                  Immediately
prior to the time Group Partnership Units are surrendered for Exchange by a KKR
Holdings Affiliated Person, KKR Holdings shall assign its rights together with its obligations hereunder in
connection with an Exchange to such KKR Holdings Affiliated Person beneficially
owning such Group Partnership Units.


 


(f)                                    For the
avoidance of doubt, any Exchange of Group Partnership Units shall be subject to
the provisions of the Group Partnership Agreements.


 


Section 2.2                                      Exchange Procedures.


 


(a)                                  KKR Holdings or a KKR
Holdings Affiliated Person may
exercise the right to Exchange Group Partnership Units set forth in Section 2.1(a) above
by providing written notice of the Exchange no later than the applicable Notice
Date (i) in the case of a Base Exchange, to each Group Partnership General
Partner, Subsidiary Partnership and the Issuer substantially in the form of Exhibit A
hereto, (ii) in the case of a Non-U.S. Exchange, to the Issuer
substantially in the form of Exhibit B hereto and (iii) in the case
of a Charitable Exchange, to the Issuer substantially in the form of Exhibit C
hereto. Such notice shall be duly executed by such holder or such holder’s duly
authorized attorney in respect of the Group Partnership Units to be Exchanged
and delivered during normal business hours at the principal executive offices
of the Group Partnership General Partners and/or the registered office of the
Issuer, as applicable.


 


(b)                                 A KKR Holdings Affiliated Person may irrevocably revoke any such notice
in writing on or before the applicable Quarterly Exchange Date but in no event
earlier than the fourth trading day prior to such Quarterly Exchange Date,
provided that the average of the mean between high and low trading prices on
the New York Stock Exchange for the two trading days immediately preceding the
fourth trading day prior to the Quarterly Exchange Date is at least 15% below
the average of the mean between the high and low trading prices on the New York
Stock Exchange for the two trading days immediately preceding the Notice Date
in respect of such Quarterly Exchange Date, provided further that (i) no
KKR Holdings Affiliated Person may make more than one such revocation with
respect to any Quarterly Exchange Date that is within a twelve (12) month
period of the Quarterly Exchange Date with respect to which such revocation was
made and (ii) no KKR Holdings Affiliated Person that makes any such
revocation in respect of a Quarterly Exchange Date may exercise the right to
Exchange Group Partnership Units set forth in Section 2.1(a) in
respect of the following Quarterly Exchange Date.


 


(c)                                  In respect of each Quarterly Exchange Date:


 


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(i)                                     No later than two (2) weeks following the General Notice Date, KKR
Holdings may determine a maximum number of Group Partnership Units that may be
exchanged for Common Units on the General Quarterly Exchange Date.  If the number of Group Partnership Units that
KKR Holdings and any KKR Holdings Affiliated Persons have elected to Exchange
on such General Quarterly Exchange Date pursuant to Section 2.1(a) above
exceeds such maximum number, then the number of Group Partnership Units that
KKR Holdings and each such KKR Holdings Affiliated Person will be permitted to
Exchange on such General Quarterly Exchange Date will be reduced by proration
or similar equitable criteria determined by KKR Holdings in its discretion so
that the number of Group Partnership Units that KKR Holdings and all such KKR
Holdings Affiliated Persons will be permitted to Exchange on such General
Quarterly Exchange Date is equal to such maximum number.


 


(ii)                                  If at any time after the Notice Date and prior to a Quarterly Exchange
Date, the Issuer commences a Public Offering or determines that it is
reasonably likely that to commence a Public Offering within ninety (90) days
following such Quarterly Exchange Date, the Issuer and the Group Partnerships
may cancel, at their option, all General Exchanges, all REU Exchanges or all
Exchanges in respect of such Quarterly Exchange Date.


 


(iii)                               If a registration statement in respect of Common Units to be issued in
any Exchanges in respect of a Quarterly Exchange Date is not effective on the
day prior to such Quarterly Exchange Date, the Issuer and the Group
Partnerships may cancel, at their option, all General Exchanges, all REU
Exchanges or all Exchanges that are contemplated to be made pursuant to such
registration statement in respect of such Quarterly Exchange Date.


 


(iv)                              If the Issuer undertakes to effect an underwritten offering of any Common
Units to be issued in any Exchanges in respect of a Quarterly Exchange Date and
the Issuer reasonably determines prior to such Quarterly Exchange Date that
such underwritten offering will not occur, the Issuer and the Group
Partnerships may cancel, at their option, all General Exchanges, all REU
Exchanges or all Exchanges in respect of such Quarterly Exchange Date.


 


(d)                                 Each KKR Holdings Affiliated Person
beneficially owning the Group Partnership Units that are subject to Exchange
pursuant to Section 2.1(a) above shall execute a written assignment
and acceptance agreement with respect to such Group Partnership Units prior to such Exchange, which
assignment and acceptance agreement shall be delivered during normal business hours at the registered office of KKR Holdings.


 


(e)                                  As promptly as
practicable following the surrender for Exchange of Group Partnership Units in
the manner provided in this Article II, each Group Partnership, in the
case of a Base Exchange, shall deliver or cause to be delivered at the
principal executive offices of such Group Partnership or at the office of the
Transfer Agent the number of Common Units issuable upon such Exchange, issued
in the name of the KKR Holdings Affiliated Person or KKR Holdings or its
designee, as applicable, and, the Issuer, in the case of a Charitable Exchange
or Non-U.S. Exchange, shall deliver or cause to be delivered at the principal
executive offices of 


 


8

















 


KKR Holdings or at the office of the Transfer Agent
the number of Common Units issuable upon such Exchange, issued in the name of
the KKR Holdings Affiliated Person or KKR Holdings or its designee, as
applicable.


 


(f)                                    The Issuer, in
the case of a Charitable Exchange or Non-U.S. Exchange, or the Group
Partnerships, in the case of a Base Exchange, may adopt reasonable procedures
for the implementation of the exchange provisions set forth in this Article II,
including, without limitation, procedures for the giving of notice of an
election for Exchange.


 


Section 2.3                                      Blackout Periods and Ownership Restrictions.  Notwithstanding anything to the
contrary, KKR Holdings or a KKR
Holdings Affiliated Person shall
not be entitled to Exchange Group Partnership Units, and the Issuer and the
Group Partnerships shall have the right to refuse to honor any request for
Exchange of Group Partnership Units, (i) at any time or during any period
if the Issuer or the Group Partnerships shall determine, based on the advice of
counsel (which may be inside counsel), that there may be material non-public
information that may affect the trading price per Common Unit at such time or
during such period, (ii) if such Exchange would be prohibited under
applicable law or regulation, (iii) to the extent such KKR Holdings
Affiliated Person would be prohibited from holding Common Units under the
Issuer Partnership Agreement, or (iv) to the extent such Exchange would
not be permitted under the policies and procedures established by the general
partner of KKR Holdings.


 


Section 2.4                                      Splits, Distributions and Reclassifications.  The Exchange Rate shall be adjusted accordingly if there is: (1) any
subdivision (by split, distribution, reclassification, recapitalization or
otherwise) or combination (by reverse split, reclassification, recapitalization
or otherwise) of the Group Partnership Units that is not accompanied by an
identical subdivision or combination of the Common Units; or (2) any
subdivision (by split, distribution, reclassification, recapitalization or
otherwise) or combination (by reverse split, reclassification, recapitalization
or otherwise) of the Common Units that is not accompanied by an identical
subdivision or combination of the Group Partnership Units. In the event of a
reclassification or other similar transaction as a result of which the Common
Units are converted into another security, then KKR Holdings or a KKR Holdings
Affiliated Person, as the case may be, shall be entitled to receive upon
Exchange the amount of such security that KKR Holdings or such KKR Holdings
Affiliated Person would have received if such Exchange had occurred immediately
prior to the effective date of such reclassification or other similar
transaction. Except as may be required in the immediately preceding sentence,
no adjustments in respect of distributions shall be made upon the Exchange of
any Group Partnership Unit.


 


Section 2.5                                      Common Units to be Issued. 
The Issuer covenants that if any Common Units require registration with or
approval of any governmental authority under any foreign, U.S. federal or state
law before such Common Units may be issued upon Exchange pursuant to this Article II,
the Issuer shall use commercially reasonable efforts to cause such Common Units
to be duly registered or approved, as the case may be. The Issuer shall use
commercially reasonable efforts to list the Common Units required to be
delivered upon Exchange prior to such delivery upon each national securities
exchange or inter-dealer quotation system upon which the outstanding Common
Units may be listed or traded at the time of such delivery. Nothing contained
herein shall be construed to preclude the Issuer or the Group Partnerships from
satisfying their obligations in respect of the Exchange of the Group 


 


9

















 


Partnership Units by
delivery of Common Units which are held in the treasury of the Issuer or the
Group Partnerships or any of their subsidiaries.


 


Section 2.6                                      Taxes.  The delivery of
Common Units upon Exchange of Group Partnership Units shall be made without
charge to KKR Holdings or a KKR
Holdings Affiliated Person for
any stamp or other similar tax in respect of such issuance.


 


Section 2.7                                      Restrictions.  The provisions of Section 7.05 of the
Group Partnership Agreements shall apply, mutatis mutandis, to any Common Units
issued upon Exchange of Group Partnership Units.


 


Section 2.8                                      Disposition of Common Units Issued.   KKR Holdings covenants to cause any KKR
Holdings Affiliated Person receiving Common Units as a result of an Exchange,
other than a Charitable Exchange or Non-U.S. Exchange, under this Agreement (i) to
use reasonable best efforts to sell or otherwise dispose (including to a
Qualifying Entity) of any Common Units received in such an Exchange within ten (10) days
of the receipt thereof or any specified shorter period as the Issuer General
Partner determines to be in the best interests of the Issuer, (ii) to use
reasonable best efforts to ensure that neither such KKR Holdings Affiliated
Person’s spouse nor any grantor trust which is treated as owned by such KKR
Holdings Affiliated Person or his or her spouse owns any Common Units and (iii) to
agree that no other Common Units will be acquired or held by such KKR Holdings
Affiliated Person during such period other than through a Qualifying Entity.
Any KKR Holdings Affiliated Person who receives Common Units as a result of an
Exchange under this Agreement and who holds any such Common Units on the last
day of the ten (10) day or shorter period referred to above shall agree to
cause all such Common Units to be transferred immediately to a Qualifying
Entity. The prior sentence and clause (i) of the first sentence shall not
apply to a KKR Holdings Affiliated Person who receives Common Units as a result
of an Exchange and who participates in a Rule 10b5-1 plan under which it
has agreed (subject to any applicable floor price that is less than the Fair
Market Value of the Common Units on the applicable Quarterly Exchange Date or
any other applicable prohibition) to sell such Common Units prior to the
earlier of (x) the next Quarterly Exchange Date and (y) ninety (90)
days following the Quarterly Exchange Date in respect of such Exchange (the “Sale
Period”), provided that such KKR Holdings Affiliated Person shall be
obligated to cause any such Common Units that have not been sold during the
Sale Period to be transferred to a Qualifying Entity as soon as practicable but
in no event later than ten (10) days after the expiration of the Sale
Period.  For the purposes of this
Agreement, a “Qualifying Entity” means a partnership, trust or other entity
(other than a “grantor trust” or an entity otherwise disregarded as an entity
separate from its owner for United States federal income tax purposes). For the
avoidance of doubt, nothing contained herein shall prohibit any KKR Holdings
Affiliated Person from owning an interest in a Qualifying Entity that owns
Common Units.


 


Section 2.9                                      Subsequent Offerings.  The Issuer may from time to time provide the
opportunity for KKR Holdings or a KKR Holdings Affiliated Person to sell its
Group Partnership Units to the Issuer, the Group Partnerships or any of their
subsidiaries on terms no more beneficial than an Exchange (a “Sale
Transaction”); provided that no Sale Transaction shall occur unless the
Issuer cancels the nearest Quarterly Exchange Date scheduled to occur in the
same fiscal year of the Issuer as such Sale Transaction.  In connection with
a Sale Transaction, KKR Holdings or such KKR Holdings Affiliated Person must
provide notice to Issuer at least 


 


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thirty (30) days prior to
the cash settlement of such Sale Transaction in respect of the Group
Partnership Units to be sold or within such shorter period of time as may be
agreed by the parties hereto. Such notice shall be delivered during normal
business hours at the principal executive offices of the Issuer.  For the
avoidance of doubt, the total aggregate number of Quarterly Exchange Dates
(treating the REU Quarterly Exchange Date and the General Quarterly Exchange
Date for a Quarter as a single Quarterly Exchange Date) and Sale Transactions
occurring during any fiscal year of the Issuer shall not exceed four (4).


 


ARTICLE III.

GENERAL PROVISIONS


 


Section 3.1                                      Amendment.  The provisions of this Agreement may be
amended by the affirmative vote or written consent of each of the Issuer, the
Group Partnerships and KKR Holdings.


 


Section 3.2                                      Addresses and Notices. 
All notices, requests, claims, demands and other communications hereunder shall
be in writing and shall be given (and shall be deemed to have been duly given
upon receipt) by delivery in person, by courier service, by fax, by electronic
mail (delivery receipt requested) or by registered or certified mail (postage
prepaid, return receipt requested) to the respective parties at the following
addresses (or at such other address for a party as shall be as specified in a
notice given in accordance with this Section 3.2):


 


(a) 
If to Group Partnership I General Partner, to:


 


9 West 57th Street, Suite 4200


New York, NY 10019


Attention: Chief Financial Officer


Fax: 212-750-0003


 


(b) 
If to Subsidiary Partnership to:


 


9
West 57th Street, Suite 4200


New
York, NY 10019


Attention:
Chief Financial Officer


Fax:
212-750-0003


 


(c) 
If to Group Partnership I or Group Partnership II to:


 


9
West 57th Street, Suite 4200


New
York, NY 10019


Attention:
Chief Financial Officer


Fax:
212-750-0003


 


(d) 
If to KKR Holdings, to:


 


11

















 


9
West 57th Street, Suite 4200


New
York, NY 10019


Attention:
Chief Financial Officer


Fax:
212-750-0003


 


(e) If
to the Issuer, to:


 


9
West 57th Street, Suite 4200


New
York, NY 10019


Attention:
Chief Financial Officer


Fax:
212-750-0003


 


Section 3.3                                      Further Action. The parties shall
execute and deliver all documents, provide all information and take or refrain
from taking action as may be necessary or appropriate to achieve the purposes
of this Agreement.


 


Section 3.4                                      Binding Effect. This Agreement shall be
binding upon and inure to the benefit of all of the parties and, to the extent
permitted by this Agreement, their successors, executors, administrators,
heirs, legal representatives and assigns.  KKR Holdings may enforce the terms
of this agreement in the name of or on behalf of any KKR Holdings Affiliated
Person.  Other than as expressly provided
herein, nothing in this Agreement will be construed to give any person other
than the parties to this Agreement any legal or equitable right, remedy, or
claim under or with respect to this Agreement or any provision of this
Agreement.


 


Section 3.5                                      Severability.  If any term or
other provision of this Agreement is held to be invalid, illegal or incapable
of being enforced by any rule of law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
is not affected in any manner materially adverse to any party. Upon a
determination that any term or other provision is invalid, illegal or incapable
of being enforced, the parties hereto shall negotiate in good faith to modify
this Agreement so as to effect the original intent of the parties as closely as
possible in a mutually acceptable manner in order that the transactions
contemplated hereby be consummated as originally contemplated to the fullest
extent possible.


 


Section 3.6                                      Integration. This Agreement
constitutes the entire agreement among the parties hereto pertaining to the
subject matter hereof and supersedes all prior agreements and understandings
pertaining thereto.


 


Section 3.7                                      Waiver. No failure by any party
to insist upon the strict performance of any covenant, duty, agreement or
condition of this Agreement or to exercise any right or remedy consequent upon
a breach thereof shall constitute waiver of any such breach of any other
covenant, duty, agreement or condition.


 


Section 3.8                                      Submission to Jurisdiction; Waiver of Jury Trial.


 


(a)                                  Any and all
disputes which cannot be settled amicably, including any ancillary claims of
any party, arising out of, relating to or in connection with the validity,


 


12
















 


negotiation, execution, interpretation, performance
or non-performance of this Agreement (including the validity, scope and
enforceability of this arbitration provision) shall be finally settled by
arbitration conducted by a single arbitrator in New York in accordance with the
then-existing Rules of Arbitration of the International Chamber of Commerce. If
the parties to the dispute fail to agree on the selection of an arbitrator
within thirty (30) days of the receipt of the request for arbitration, the International
Chamber of Commerce shall make the appointment.  Performance under this
Agreement shall continue if reasonably possible during any arbitration
proceedings.


 


(b)                                 Notwithstanding
the provisions of Section 3.8(a), in the case of matters relating to a
Charitable Exchange or Non-U.S. Exchange, the Issuer may bring, and in the case
of matters relating to a Base Exchange, KKR Holdings may cause any Group
Partnership to bring, on behalf of the Issuer or such Group Partnership or on
behalf of any KKR Holdings Affiliated
Person, an action or special proceeding in any court of competent
jurisdiction for the purpose of compelling a party to arbitrate, seeking
temporary or preliminary relief in aid of an arbitration hereunder, and/or
enforcing an arbitration award and, for the purposes of this paragraph.


 


(c)                                  Notwithstanding
any provision of this Agreement to the contrary, this Section 3.8 shall be
construed to the maximum extent possible to comply with the laws of the State
of Delaware, including the Delaware Uniform Arbitration Act (10 Del. C. § 5701
et  seq.) (the “Delaware Arbitration Act”).  If, nevertheless,
it shall be determined by a court of competent jurisdiction that any provision
or wording of this Section 3.8, including any rules of the International
Chamber of Commerce, shall be invalid or unenforceable under the Delaware
Arbitration Act, or other applicable law, such invalidity shall not invalidate
all of this Section 3.8.  In that case, this Section 3.8 shall be
construed so as to limit any term or provision so as to make it valid or
enforceable within the requirements of the Delaware Arbitration Act or other
applicable law, and, in the event such term or provision cannot be so limited,
this Section 3.8 shall be construed to omit such invalid or unenforceable
provision.


 


Section
3.9                                      Counterparts. This Agreement may be
executed and delivered (including by facsimile transmission) in one or more
counterparts, and by the different parties hereto in separate counterparts,
each of which when executed and delivered shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement. Copies
of executed counterparts transmitted by telecopy or other electronic
transmission service shall be considered original executed counterparts for
purposes of this Section 3.9.


 


Section
3.10                                Tax Treatment. To the extent this
Agreement imposes obligations upon a particular Group Partnership, or either
Group Partnership General Partner, this Agreement shall be treated as part of
the relevant Group Partnership Agreement as described in Section 761(c) of the
Code and Sections 1.704-1(b)(2)(ii)(h) and 1.761-1(c) of the Treasury
Regulations. The parties shall report any Base Exchange consummated hereunder
(pursuant to which Common Units are delivered pursuant to Section 2.1(a)(i) or
Section 2.1(c) hereof), in the case of Group Partnership I (or any other
Group Partnership owned directly or indirectly by the Issuer through a Group
Partnership Holdco), as a taxable sale of Group Partnership I Units by KKR
Holdings or a KKR Holdings Affiliated Person to the Group Partnership I General
Partner (or such other Group Partnership Holdco) and, in the case of Group
Partnership II (or any other Group Partnership owned directly or indirectly by
the Issuer through entities that are transparent 


 


13

















 


for U.S. federal income
tax purposes), as a taxable sale of Group Partnership II Units by KKR Holdings
or a KKR Holdings Affiliated Person to Subsidiary Partnership and no party
shall take a contrary position on any income tax return, amendment thereof or
communication with a taxing authority. 
The parties shall report any Charitable Exchange or Non-U.S. Exchange
consummated pursuant to Section 2.1(a)(ii) hereof as a contribution of (i)
Group Partnership I Units or Corporate Holdco interests, and (ii) Group
Partnership II Units to the Issuer described in Section 721(a) of the Code,
followed by a tax free contribution of such Group Partnership I Units or Corporate
Holdco interests to the appropriate Group Partnership Holdco pursuant to
Section 351 of the Code, and no party shall take a contrary position on any
income tax return, amendment thereof or communication with a taxing authority.


 


Section
3.11                                Tax Offset.


 


(a)                                  KKR Holdings shall pay to Group Partnership Holdco an amount equal to,
without duplication, the sum of (i) any increase in the federal, state and/or
local income tax payable in any year by Group Partnership Holdco as a result of
income allocated to Group Partnership Holdco from Subsidiary Partnership plus
(ii) the Unitholder Offset Amount plus (iii) any increase in the
federal, state and/or local income tax payable in any year by Group Partnership
Holdco as a result of any payments made pursuant to clauses (i), (ii) or (iii)
of this Section 3.11(a).  KKR Holdings
may offset any payment due under this Section 3.11 by any amounts owing to KKR
Holdings from Group Partnership Holdco in respect of the same period.


 


(b)                                 For purposes of this Section 3.11:


 


(i)                                     The “Unitholder Offset Amount” is the sum of the Foreign Offset
Amount and the Individual Offset Amount.


 


(ii)                                  The “Foreign Offset Amount” is equal to the product of (x) 0.2 multiplied
by (y) 0.25 multiplied by (z) the net U.S. federal taxable income
allocated to the Group Partnership Holdco from Subsidiary Partnership
(determined by excluding any items of income that would have been subject to
U.S. withholding tax (determined without regard to any income tax treaty) if
received directly from Subsidiary Partnership by a non-resident alien
individual (within the meaning of Section 871 of the Code), including items of
income that are treated as effectively connected with a U.S. trade or
business).


 


(iii)                               The “Individual Offset Amount” is equal to the product of (x) 0.25
multiplied by (y) the Dividend Rate Difference multiplied by (z)
the net long-term capital gain (as defined in Section 1222(7) of the Code)
allocated to the Group Partnership Holdco from Subsidiary Partnership.


 


(iv)                              The “Dividend Rate Difference” is equal to the amount by which (x)
the highest marginal U.S. federal income tax rate applicable to dividends
received by a U.S. individual (assuming any holding period or other
requirements necessary to qualify for any reduced rate are met) exceeds (z) the
highest marginal U.S. federal income tax rate applicable to long-term capital
gains of individuals; provided that if such 


 


14

















 


amount
is less than zero (i.e., is a negative number), the Dividend Rate Difference
shall be zero.


 


Section
3.12                                Base Exchange Alternative.  KKR Holdings shall have a one-time election
applicable to all Base Exchanges that occur thereafter to modify Section
2.1(a)(i) such that Group Partnership II Units issued pursuant to the second
sentence of Section 2.1(a)(i) shall be issued to KKR Group Holdings (or such
successor general partner of the issuer of such Group Partnership II Units that
is either the Issuer or a disregarded entity of the Issuer) rather than
Subsidiary Partnership.  In such case,
KKR Group Holdings (or such successor) rather than Subsidiary Partnership shall
have the superseding right described in Section 2.1(c) with respect to such
Group Partnership II Units.  In that
case, notwithstanding Section 3.10, the parties shall report any Base Exchange,
in the case of Group Partnership II, as a contribution to the Issuer described
in Section 721(a) of the Code, and no party shall take a contrary position on
any income tax return, amendment thereof or communication with a taxing
authority.  For the avoidance of doubt,
Section 3.11 shall not apply in respect of any Group Partnership II Units
issued pursuant to this Section 3.12.


 


Section
3.13                                Applicable Law. This Agreement shall be
governed by, and construed in accordance with, the law of the State of
Delaware.


 


IN
WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and
delivered, all as of the date first set forth above.


 


[Signature Page Follows]


 


15

















 


	
   

  	
  KKR
  & CO. L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  KKR
  Management LLC, its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  DAVID SORKIN

  
	
   

  	
   

  	
  Name:
  David Sorkin

  
	
   

  	
   

  	
  Title:
  Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
  KKR
  MANAGEMENT HOLDINGS L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  KKR
  Management Holdings Corp., its general partner

  
	
   

  	
  By:

  	
  /s/
  DAVID SORKIN

  
	
   

  	
   

  	
  Name:
  David Sorkin

  
	
   

  	
   

  	
  Title:
  Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
  KKR
  FUND HOLDINGS L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  KKR
  Group Holdings L.P., its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  KKR
  Group Limited, its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  DAVID SORKIN

  
	
   

  	
   

  	
  Name:
  David Sorkin

  
	
   

  	
   

  	
  Title:
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
  KKR
  HOLDINGS L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  KKR
  Holdings GP Limited, its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  DAVID SORKIN

  
	
   

  	
   

  	
  Name:
  David Sorkin

  
	
   

  	
   

  	
  Title:
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
  KKR
  GROUP HOLDINGS L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  KKR
  Group Limited, its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  DAVID SORKIN

  
	
   

  	
   

  	
  Name:
  David Sorkin

  
	
   

  	
   

  	
  Title:
  Director

  



 


 


[Signature Page to Exchange Agreement]


 

















 


	
   

  	
  KKR
  SUBSIDIARY PARTNERSHIP L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  KKR
  Group Holdings L.P., its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  KKR
  Group Limited, its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  DAVID SORKIN

  
	
   

  	
   

  	
  Name:
  David Sorkin

  
	
   

  	
   

  	
  Title:
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
  KKR
  GROUP LIMITED

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  DAVID SORKIN

  
	
   

  	
   

  	
  Name:
  David Sorkin

  
	
   

  	
   

  	
  Title:
  Director

  



 


 


[Signature Page to Exchange Agreement]


 


2

















 


EXHIBIT A


 


[FORM OF]

NOTICE OF BASE EXCHANGE


 


KKR
Management Holding Corp.


KKR
Group Holdings L.P.


KKR
Subsidiary Partnership L.P.


KKR
& Co. L.P.


KKR
Holdings L.P.


9
West 57th Street, Suite 4200


New
York, NY 10019


 


Reference
is hereby made to the Amended and Restated Exchange Agreement (the “Exchange
Agreement”), among KKR Management Holdings L.P., KKR Fund Holdings L.P.,
KKR Holdings L.P., KKR & Co. L.P., KKR Group Holdings L.P. and KKR Group
Limited as amended from time to time and to the First Amended and Restated
Limited Partnership Agreement (the “Holdings LPA”) of KKR Holdings L.P.


 


The
undersigned (the “Exchanging KKR Holdings Affiliated Person”) desires to
exchange the number of units of KKR Holdings L.P. set forth on line B of the
notice related hereto (the “Exchange Holdings Units”) for units of KKR
Group Holdings L.P. and KKR Fund Holdings L.P. (the “Exchange Group
Partnership Units”) and to exchange such Exchange Group Partnership Units
for units of KKR & Co. L.P. pursuant to a Base Exchange (as defined in the
Exchange Agreement).  Accordingly, the
Exchanging KKR Holdings Affiliated Person hereby (i) gives notice to KKR
Holdings L.P. of its election to transfer units of KKR Holdings L.P. in
exchange for units of KKR Group Holding L.P. and KKR Fund Holdings L.P. (the “Exchange
Group Partnership Units”) pursuant to Section 9.2 of the Holdings LPA (the “Group
Exchange”) and (ii) gives notice to KKR Management Holding Corp., KKR Group
Holdings L.P., KKR Subsidiary Partnership L.P. and KKR & Co. L.P. of its
election to exchange such Exchange Group Partnership Units for units of KKR
& Co. L.P. in a Base Exchange pursuant to Section 2.2 of the Exchange
Agreement (the “KKR Co Exchange” and together with the Group Exchange,
the “Exchanges”).  The Exchanging
KKR Holdings Affiliated Person acknowledges that the number of units of KKR
Holding L.P. to be exchanged pursuant to clause (i) in the preceding sentence
shall be equal to the lesser of (x) the number of Exchange Holdings Units set
forth on line B of the notice related hereto, (y) the number of Exchange
Holdings Units that the general partner of KKR Holdings L.P. shall determine
that the Exchanging KKR Holdings Affiliated Person is permitted to exchange
pursuant to Section 9.2(b) of the Holdings LPA and (z) the number of Exchange
Holdings Units corresponding to the number of units of KKR Group Holdings L.P.
and KKR Fund Holdings L.P. that the Exchanging KKR Holdings Affiliated Person
is permitted to exchange taking into account any limitations imposed pursuant
to Section 2.2(c) of the Exchange Agreement.


 


Pursuant
to the foregoing, the Exchanging KKR Holdings Affiliated Person (1) hereby
represents that such Exchange Holdings Units shall immediately prior to the
Group Exchange be owned by it, (2) hereby irrevocably constitutes and appoints
any officer of the general partner of 


 

















 


KKR
Holdings L.P. as its attorney, with full power of substitution, to exchange the
Exchange Holdings Units on the books of KKR Holdings L.P. for the Exchange
Group Partnership Units on the books of KKR Management Holdings L.P. and KKR
Fund Holdings L.P., with full power of substitution in the premises and (3)
hereby irrevocably constitutes and appoints any officer of the general partner
of KKR Management Holdings L.P. or KKR Fund Holdings L.P. as its attorney, with
full power of substitution, to exchange the Exchange Group Partnership Units on
the books of KKR Management Holdings L.P. and KKR Fund Holdings L.P. for units
of KKR & Co. L.P. on the books of KKR & Co. L.P., with full power of
substitution in the premises.


 


Furthermore,
the Exchanging KKR Holdings Affiliated Person covenants:


 


1.               to use reasonable best efforts to ensure that
neither such person’s spouse nor any grantor trust which is treated as owned by
such person or his or her spouse owns any units of KKR & Co. L.P. and to
agree that no units of KKR & Co. L.P. will be acquired or held by such
person other than through a Qualifying Entity during the period between the
Exchanges and the transfer of any unsold units of KKR & Co. L.P. to a Qualifying Entity
as set forth in the following covenant, and


 


2.               either:


 


a.               if the Exchanging KKR Holdings Affiliated
Person participates in a Section 10b5-1 plan under which it has agreed (subject
to any applicable floor price on the applicable Quarterly Exchange Date (as
defined in the Exchange Agreement) or any other applicable prohibition) to sell
such units of KKR & Co. L.P. prior to the earlier of (x) the next Quarterly
Exchange Date and (y) ninety (90) days following the Quarterly Exchange Date in
respect of such KKR Co Exchange (the “Sale Period”), to cause all such units
of KKR & Co. L.P. held on the expiration of the Sale Period to be immediately transferred
to a Qualifying Entity, or


 


b.              otherwise to use reasonable best efforts to
sell or otherwise dispose of any units of KKR & Co. L.P.  received in the KKR Co Exchange within ten
(10) days of the receipt thereof or any specified shorter period as the general
partner of KKR & Co. L.P. determines to be in the best interests of KKR
& Co. L.P. and to cause all such units of KKR & Co. L.P. held on the last day of
such ten (10) day or shorter period to be transferred immediately to a
Qualifying Entity.


 


For the purposes of the
foregoing, a “Qualifying Entity” means a partnership, trust or other entity
(other than an entity disregarded as an entity separate from its owner for
United States federal income tax purposes). For the avoidance of doubt, nothing
contained herein shall prohibit any Exchanging KKR Holdings Affiliated Person
from owning an interest in a Qualifying Entity that owns units of KKR & Co.
L.P.


 

















 


EXHIBIT B


 


[FORM OF]

NOTICE OF NON-U.S. EXCHANGE


 


KKR
& Co. L.P.


KKR
Holdings L.P.


9
West 57th Street, Suite 4200


New
York, NY 10019


 


Reference
is hereby made to the Amended and Restated Exchange Agreement (the “Exchange
Agreement”), among KKR Management Holdings L.P., KKR Fund Holdings L.P.,
KKR Holdings L.P., KKR & Co. L.P., KKR Group Holdings L.P. and KKR Group
Limited as amended from time to time and to the First Amended and Restated
Limited Partnership Agreement (the “Holdings LPA”) of KKR Holdings L.P.


 


The
undersigned (the “Exchanging KKR Holdings Affiliated Person”) desires to
exchange the number of units of KKR Holdings L.P. set forth on line B of the
notice related hereto (the “Exchange Holdings Units”) for units of KKR
Group Holdings L.P. and KKR Fund Holdings L.P. (the “Exchange Group
Partnership Units”) and to exchange such Exchange Group Partnership Units
for units of KKR & Co. L.P. pursuant to a Non-U.S. Exchange (as defined in
the Exchange Agreement).  Accordingly,
the Exchanging KKR Holdings Affiliated Person hereby (i) gives notice to KKR
Holdings L.P. of its election to transfer units of KKR Holdings L.P. in
exchange for units of KKR Group Holding L.P. and KKR Fund Holdings L.P. (the “Exchange
Group Partnership Units”) pursuant to Section 9.2 of the Holdings LPA (the “Group
Exchange”) and (ii) gives notice to KKR & Co. L.P. of its election to
exchange such Exchange Group Partnership Units for units of KKR & Co. L.P.
in a Non-U.S. Exchange pursuant to Section 2.2 of the Exchange Agreement (the “KKR
Co Exchange” and together with the Group Exchange, the “Exchanges”).  The Exchanging KKR Holdings Affiliated Person
acknowledges that the number of units of KKR Holding L.P. to be exchanged
pursuant to clause (i) in the preceding sentence shall be equal to the lesser
of (x) the number of Exchange Holdings Units set forth on line B of the notice
related hereto, (y) the number of Exchange Holdings Units that the general
partner of KKR Holdings L.P. shall determine that the Exchanging KKR Holdings
Affiliated Person is permitted to exchange pursuant to Section 9.2(b) of the
Holdings LPA and (z) the number of Exchange Holdings Units corresponding to the
number of units of KKR Group Holdings L.P. and KKR Fund Holdings L.P. that the
Exchanging KKR Holdings Affiliated Person is permitted to exchange taking into
account any limitations imposed pursuant to Section 2.2(c) of the Exchange
Agreement.


 


Pursuant
to the foregoing, the Exchanging KKR Holdings Affiliated Person (1) hereby represents
that such Exchange Holdings Units shall immediately prior to the Group Exchange
be owned by it, (2) hereby irrevocably constitutes and appoints any officer of
the general partner of KKR Holdings L.P. as its attorney, with full power of
substitution, to exchange the Exchange Holdings Units on the books of KKR
Holdings L.P. for the Exchange Group Partnership Units on the books of KKR
Management Holdings L.P. and KKR Fund Holdings L.P., with full power of
substitution in the premises and (3) hereby irrevocably constitutes and
appoints any officer of the general partners of KKR Management Holdings L.P. or
KKR Fund Holdings L.P. as its 


 

















 


attorney,
with full power of substitution, to exchange the Exchange Group Partnership
Units on the books of KKR Management Holdings L.P. and KKR Fund Holdings L.P.
for units of KKR & Co. L.P. on the books of KKR & Co. L.P., with full
power of substitution in the premises.


 

















 


EXHIBIT C


 


[FORM OF]

NOTICE OF CHARITABLE EXCHANGE


 


KKR
& Co. L.P.


KKR
Holdings L.P.


9
West 57th Street, Suite 4200


New
York, NY 10019


 


Reference
is hereby made to the Amended and Restated Exchange Agreement (the “Exchange
Agreement”), among KKR Management Holdings L.P., KKR Fund Holdings L.P.,
KKR Holdings L.P., KKR & Co. L.P., KKR Group Holdings L.P. and KKR Group
Limited as amended from time to time and to the First Amended and Restated
Limited Partnership Agreement (the “Holdings LPA”) of KKR Holdings L.P.


 


The
undersigned (the “Exchanging KKR Holdings Affiliated Person”) desires to
exchange the number of units of KKR Holdings L.P. set forth on line B of the
notice related hereto (the “Exchange Holdings Units”) for units of KKR
Group Holdings L.P. and KKR Fund Holdings L.P. (the “Exchange Group
Partnership Units”) and to exchange such Exchange Group Partnership Units
for units of KKR & Co. L.P. pursuant to a Charitable Exchange (as defined
in the Exchange Agreement).  Accordingly,
the Exchanging KKR Holdings Affiliated Person hereby (i) gives notice to KKR
Holdings L.P. of its election to transfer units of KKR Holdings L.P. in
exchange for units of KKR Group Holding L.P. and KKR Fund Holdings L.P. (the “Exchange
Group Partnership Units”) pursuant to Section 9.2 of the Holdings LPA (the “Group
Exchange”) and (ii) gives notice to KKR & Co. L.P. of its election to
exchange such Exchange Group Partnership Units for units of KKR & Co. L.P.
in a Charitable Exchange pursuant to Section 2.2 of the Exchange Agreement (the
“KKR Co Exchange” and together with the Group Exchange, the “Exchanges”).  The Exchanging KKR Holdings Affiliated Person
acknowledges that the number of units of KKR Holding L.P. to be exchanged
pursuant to clause (i) in the preceding sentence shall be equal to the lesser
of (x) the number of Exchange Holdings Units set forth on line B of the notice
related hereto, (y) the number of Exchange Holdings Units that the general
partner of KKR Holdings L.P. shall determine that the Exchanging KKR Holdings
Affiliated Person is permitted to exchange pursuant to Section 9.2(b) of the
Holdings LPA and (z) the number of Exchange Holdings Units corresponding to the
number of units of KKR Group Holdings L.P. and KKR Fund Holdings L.P. that the
Exchanging KKR Holdings Affiliated Person is permitted to exchange taking into
account any limitations imposed pursuant to Section 2.2(c) of the Exchange
Agreement.


 


Pursuant
to the foregoing, the Exchanging KKR Holdings Affiliated Person (1) hereby
represents that such Exchange Holdings Units shall immediately prior to the
Group Exchange be owned by it, (2) hereby irrevocably constitutes and appoints
any officer of the general partner of KKR Holdings L.P. as its attorney, with
full power of substitution, to exchange the Exchange Holdings Units on the
books of KKR Holdings L.P. for the Exchange Group Partnership Units on the
books of KKR Management Holdings L.P. and KKR Fund Holdings L.P., with full
power 


 

















 


of
substitution in the premises and (3) hereby irrevocably constitutes and
appoints any officer of the general partners of KKR Management Holdings L.P. or
KKR Fund Holdings L.P. as its attorney, with full power of substitution, to
exchange the Exchange Group Partnership Units on the books of KKR Management
Holdings L.P. and KKR Fund Holdings L.P. for units of KKR & Co. L.P. on the
books of KKR & Co. L.P., with full power of substitution in the premises.