6.1.21 Because KLC (through KLC PropCo) owns or leases a substantial number of real properties, and expects to invest in additional properties, results of operations could be adversely affected if environmental contamination is discovered on any of the properties KLC is subject to U.S. federal, state and local environmental laws, regulations and ordinances that may impose liability for damages resulting from past spills, disposals and other releases of hazardous substances as well as clean up costs. !n particular, under applicable environmental laws, KLC may be responsible for investigating and remediating environmental conditions and may be subject to associated liability, including lawsuits brought by private litigants, relating to KLC's properties. These obligations could arise whether KLC owns or leases the property at issue and regardless of whether the environmental conditions were created by KLC or by a prior owner or tenant. Environmental conditions unknown to KLC at this time relating to prior, existing or future properties may be discovered and may have a material adverse effect on KLC's results of operations. 6.1.22 KUE has a limited history While certain subsidiaries of KUE have a financial and an operating history, KUE has only recently been organized and has relatively little financial or operating history upon which prospective investors may evaluate Its performance, and has not prepared separate or consclidated financial statements. The prior performance of the subsidiaries of KUE described herein may not be indicative of the future results of the Company. 6.2. Tax Risks 6.2.1. Certain tax considerations generally applicable to Investors subject to U.S. tax liability KUE is expected to be treated as a parinership for U.S. federal income tax purposes. Each Investor that is subject to U.S. federal income tax liability will take into account its allocable share of items of income, gain, loss, deduction, and credit of KUE (as determined under