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6.2.2 Tax-Exempt and Non-U.S. Investors may become subject to U.S. Tax

KUE business activities could generate income that will be taxable to certain otherwise tax-exempt Investors as "unrelated business taxable income." Although, under the Limited Partnership Agreement, the General Partner is required to use its reasonable best efforts not to engage in, or invest in (other than through an entity that is not a pass-through entity) a pass-through entity that engages in, any activity which constitutes the conduct of a trade or business in the United States and generates income which constitutes "effectively connected income" in the hands of the non-U.S. Investors that own Common LP Units, it is possible that some of KUE's business activities and acquisitions could generate income that is "effectively connected" with a U.S. trade or business which could create U.S. federal income tax reporting, tax liability, and tax withholding for non-U.S. Investors. Additionally, KUE believes that neither KUE nor its subsidiaries is currently a U.S. Real Property Holding Corporation ("USRPHC") for U.S. federal income tax purposes. However, no assurances can be given in this regard. Furthermore, it is possible that in the future KUE and/or its subsidiaries may become a USRPHC if, for example, the value of the U.S. real estate holdings of KUE or such subsidiary increases sufficiently. A disposition of an interest in a USRPHC could create gain for non-U.S. Investors which would be treated as if the non-U.S. Investor were engaged in a trade or business within the U.S. and as if such gain were effectively connected with such trade or business. This would create U.S. federal income tax reporting, tax liability and withholding for non-U.S. Investors. Investors that are non-U.S. persons are urged to consult their tax advisors regarding the potential application of the USRPHC rules to their investment in KUE.

6.2.3 Investors may become subject to taxation in non-U.S. jurisdictions

KUE expects to make investments in jurisdictions outside of the U.S., and KUE, its subsidiaries and/or the Investors may be subject to income or other tax in those jurisdictions. In addition, local tax incurred in non-U.S. jurisdictions by KUE or subsidiaries through which it invests may not entitle Investors to either (i) a credit against tax that may be owed in the U.S. or their respective local tax jurisdictions, or (ii) a deduction against income taxable in the U.S. or such local jurisdictions by the Investors.

6.2.4 Controlled Foreign Corporations

KUE anticipates that it and/or its subsidiaries will invest in non-U.S. operations. Depending upon the percentage of ownership of such operations by KUE and its subsidiaries and the type of legal entity chosen for such operations, these non-U.S. operations could be classified as a Controlled Foreign Corporation ("CFC") for U.S. federal income tax purposes. If an entity is classified as a CFC, certain types of income could be taxable to U.S. persons owning 10% or more of KUE for U.S. income tax purposes, even if no distributions of cash are made from such entity, and gain from the disposition of such entity would be taxed as if it were a dividend to the extent of such entity's earnings and profits, rather than as a capital gain, for U.S. income tax purposes.

6.2.5 Treatment of KUE as a U.S. Entity

Under the Code, certain non-U.S corporations may be treated as U.S. corporations for U.S. federal income tax purposes, thereby subjecting such non-U.S. corporations to U.S. federal income tax on their income. Recently enacted U.S. tax legislation includes one such provision. Under this legislation, referred to as the anti-inversion legislation, non-U.S. corporations that acquire interests in a U.S. corporation or partnership and meet certain ownership, operational and other tests may be treated as U.S. corporations for federal income tax purposes. The legislation grants broad regulatory authority to the U.S. Secretary of Treasury to provide such regulations as may be appropriate to determine whether a non-U.S. corporation is treated as a U.S. corporation or as are necessary to carry out the intent of the provision, including adjusting its application as necessary to prevent the avoidance of its purpose. Recently issued Treasury regulations provide that the anti-inversion legislation is applicable to a foreign partnership that is or becomes a "publicly traded partnership" within two years of the acquisition by it of a U.S. corporation. A "publicly traded partnership" is any partnership (i) interests in which are traded on an established securities market, or (ii) interests in which are readily tradable on a secondary market (or the substantial equivalent thereof). KUE believes that it is not currently a publicly traded partnership and does not intend

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