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• Fifth, to the Common Limited Partners, the Profits Participation Limited Partner, and the General Partner in proportion to the number of Units held by each such Partner.

In general (and subject to certain special tax and regulatory allocations), losses and deductions of KUE will be allocated to the Partners in the following priority:

• First, to the Common Limited Partners, the Profits Participation Limited Partner, and the General Partner in proportion to and to the extent of their positive adjusted capital account balances;

• Second, to the Common Limited Partners, the Profits Participation Limited Partner, and the General Partner in proportion to the number of Units held by each such Partner; and

• Third, to the General Partner.

To the extent, at the time of any distribution or income or loss allocation pursuant to the Partnership Agreement, the 2/11ths portion of the Profits Participation LP Units has not then been fully allocated by KULG LLC-1 to employees, officers, directors, consultants and agents of KUE, its subsidiaries or joint ventures, then the distribution or income or loss allocation that would otherwise be attributable to such unallocated portion of the Profits Participation LP Units shall be reallocated among the Common Limited Partners and the General Partner in proportion to their Units for purposes of such distribution or income or loss allocation (including in connection with their Preferred Return).

Notwithstanding the foregoing, the Limited Partnership Agreement gives the General Partner the authority to override the distribution provisions of the Limitation Partnership Agreement described above in order to achieve the desired economic arrangement of KUE, which is: (i) first, to return the Partners' Capital Contributions to them; (ii) second, for the Common Limited Partners and the General Partner to receive their Preferred Return while the Profits Participation Limited Partner concurrently receives an amount equal to a fraction of the amount the Common Limited Partners and the General Partner received pursuant to their Preferred Return (such fraction to be equal to the portion of the Units held by the Profits Participation Limited Partner attributable to members of the Profits Participation Limited Partner other than the Principals), multiplied by the number of Units held by the Profits Participation Limited Partner divided by the number of outstanding Units other than those Units held by the Profits Participation Limited Partner; (iii) third, for the Profits Participation Limited Partner to receive an amount equal to a fraction of the amount the Common Limited Partners and the General Partner received pursuant to their Preferred Return (such fraction to be equal to the portion of the Units held by the Profits Participation Limited Partner attributable to members of the Profits Participation Limited Partner who are Principals), multiplied by the number of Units held by the Profits Participation Limited Partner divided by the number of outstanding Units other than those Units held by the Profits Participation Limited Partner; and (iv) finally, for all Partners (including the Profits Participation Limited Partner) to share in the profits of the Partnership in proportion to the number of Units held by them.

14.11. Tax Distributions

The General Partner may decide to make a tax distribution from KUE on or before April 1st of any year following a taxable year in which net taxable income was allocated to any Partner. If the General Partner decides to make a tax distribution, then KUE will distribute cash available for distribution, if any, to those Partners receiving an allocation of net taxable income, regardless of whether such net taxable income is actually subject to tax. The amount of net taxable income upon which such a tax distribution will be made will be based on cumulative calculation of net taxable income and net taxable loss which have been allocated to each such Partner from the inception of KUE. Any tax distributions received by a Partner will be treated as an advance and will offset against any other distributions such Partner is entitled to receive from KUE.

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