8-KEarnings & ResultsLeadership ChangesMaterial Agreements+4

KKR & Co. Inc. 8-K Report, Material Agreement (Feb 23, 2011)

Filed February 23, 2011For Securities:KKRKKRTKKR-PDKKRS

Summary

This Form 8-K filing by KKR & Co. L.P. on February 23, 2011, primarily details two significant events: the entry into an Amended and Restated Credit Agreement and the announcement of the company's fourth-quarter and full-year 2010 financial results. The new credit facility provides $700 million in revolving credit, maturing in five years, with flexible repayment terms and a competitive interest rate. This strengthens KKR's financial flexibility for general corporate purposes. The filing also includes the appointment of Thomas M. Schoewe to the Board of Directors of KKR Management LLC, effective March 14, 2011. Additionally, KKR Holdings L.P. granted units to certain named executive officers, reflecting a long-term incentive aligned with the company's performance and growth.

Key Highlights

  • 1KKR & Co. L.P. entered into a $700 million, five-year senior unsecured multicurrency revolving credit facility, maturing in February 2016.
  • 2The credit facility is available for general corporate purposes, subject to certain limitations.
  • 3Interest rates on borrowings will be LIBOR plus a 50 basis point margin, or an alternative base rate.
  • 4The company entered into an Amended and Restated Credit Agreement, superseding a prior agreement from February 2008.
  • 5Thomas M. Schoewe was appointed to the Board of Directors of KKR Management LLC, effective March 14, 2011, and will serve on the Audit and Conflicts Committees.
  • 6KKR Holdings L.P. granted units to named executive officers Todd A. Fisher, William J. Janetschek, and David J. Sorkin, with vesting over four years.
  • 7The filing references the announcement of KKR's fourth-quarter and full-year 2010 financial results, though the detailed results are in a furnished press release.

Frequently Asked Questions

The new $700 million credit facility is primarily for general corporate purposes, providing KKR with financial flexibility for its operations and strategic initiatives.

Key financial covenants include maintaining a maximum consolidated leverage ratio of no greater than 4.0x (total indebtedness to Fee Related EBITDA) and at least $25 billion in Fee Paying Assets Under Management.

The credit facility is scheduled to mature on the fifth anniversary of the Effective Date (expected to be on or before March 9, 2011). Borrowers may prepay, terminate, or reduce commitments under the facility at any time without penalty.

Todd A. Fisher, William J. Janetschek, and David J. Sorkin received grants of units in KKR Holdings L.P. These units will vest over a period of four years, with 25% vesting annually beginning April 1, 2012.