In October 2019, the Company announced the issuance of a $300 million perpetual preferred equity investment in Kennedy Wilson by affiliates of Eldridge Industries (collectively, "Eldridge"). Under the terms of the agreement, Eldridge purchased $300 million in convertible perpetual preferred stock carrying a 5.75% annual dividend rate, with an initial conversion price of $25.00 per share, representing a premium of 15% to the daily volume weighted average price per share of Kennedy Wilson’s common stock over the 20 trading days ending, and including, October 16, 2019. The preferred stock is callable by Kennedy Wilson on and after October 15, 2024. The convertible perpetual preferred stock is treated as permanent equity in accordance with ASC 480 Distinguishing Liabilities from Equity.

On March 20, 2018, the Company announced that its board of directors authorized a $250.0 million stock repurchase program. Repurchases under the program may be made in the open market, in privately negotiated transactions, through the net settlement of the Company’s restricted stock grants or otherwise, with the amount and timing of repurchases dependent on market conditions and subject to the Company’s discretion. Kennedy Wilson had a $100 million stock repurchase program that expired on February 25, 2018.

During the year ended December 31, 2019, Kennedy Wilson repurchased and retired 221,834 shares for $4.3 million. During the year ended December 31, 2018, Kennedy Wilson repurchased and retired 9,364,141 shares for $169.1 million under the previous stock repurchase program.

On October 20, 2017, the Company completed its acquisition of all of the outstanding shares (other than shares owned by the Company or its subsidiaries or held in treasury) of KWE for $719.8 million in cash and issued 37,226,695 shares of KWH to shareholders of KWE stock. The KWE Acquisition was accounted for in accordance with ASC 810. Because KWH controlled KWE both before and after the KWE Transaction, the change in KWH’s ownership interest in KWE was accounted for as an equity transaction and no gain or loss was recognized in KWH’s consolidated statements of income resulting from the KWE Acquisition.

The amount of cash paid and shares issued was greater than carrying value of noncontrolling interest in KWE as of the date of the transaction. The premium paid to the noncontrolling interest holders over their carrying value was recorded as additional

paid in capital. The Company also was required to record inception to date unrealized foreign currency translation and foreign currency derivative contract losses that had previously been allocated to noncontrolling interest holders accumulated other comprehensive income with a corresponding entry to additional paid in capital which resulted in no net impact to Kennedy Wilson's shareholder's equity. Furthermore, transactions costs associated with the acquisition were recorded as a reduction of additional paid in capital.



(Dollars in millions)	Year Ended December 31, 2019				Year Ended December 31, 2018
	Declared		Paid		Declared		Paid
Common Stock⁽¹⁾	$	121.1	$	114.9	$	113.7	$	111.2

Earnings and profits, which determine the taxability of distributions to stockholders, may differ from income reported for financial reporting purposes due to the differences for federal income tax purposes in the treatment of revenue recognition, compensation expense, derivative investments and the basis of depreciable assets and estimated useful lives used to compute depreciation.



Record Date	Payment Date	Distributions Per Share		Ordinary Dividends		Return of Capital
12/28/2018	1/3/2019	$	0.2100	$	0.0221	$	0.1879
3/29/2019	4/4/2019	0.2100		0.0221		0.1879
6/28/2019	7/5/2019	0.2100		0.0221		0.1879
9/30/2019	10/3/2019	0.2100		0.0221		0.1879
	Totals	$	0.8400	$	0.0884	$	0.7516



(Dollars in millions)	Foreign Currency Translation			Foreign Currency Derivative Contracts			Interest Rate Swaps			Total Accumulated Other Comprehensive Income⁽¹⁾
Balance at December 31, 2018	$	(94.1	)	$	11.0		$	—		$	(83.1	)
Unrealized (losses) gains, arising during the period	(12.9		)	35.6			(0.9		)	21.8
Taxes on unrealized (losses) gains, arising during the period	(0.4		)	3.1			0.2			2.9
Amounts reclassified out of AOCI during the period, gross	23.5			(12.9		)	—			10.6
Amounts reclassified out of AOCI during the period, taxes	(3.8		)	3.6			—			(0.2		)
Noncontrolling interest	(10.6		)	—			—			(10.6		)
Balance (of Kennedy Wilson's share) at December 31, 2019	$	(98.3	)	$	40.4		$	(0.7	)	$	(58.6	)

⁽¹⁾ As a result of the KWE Transaction the Company was required to record inception to date accumulated other comprehensive losses of $358.4 million associated with noncontrolling interest holders of KWE. This amount has been excluded from the beginning and ending balances of the table to give a more appropriate depiction of the Company's accumulated other comprehensive loss activity. If this amount is included, the accumulated other comprehensive loss would be $417.2 million and $441.5 million as of December 31, 2019 and 2018, respectively.

The local currencies for our interests in foreign operations include the euro and the British pound sterling. The related amounts on our balance sheets are translated into U.S. dollars at the exchange rates at the respective financial statement date, while amounts on our statements of income are translated at the average exchange rates during the respective period. Unrealized losses

on foreign currency translation is a result of the weakening of the euro and British pound sterling against the U.S. dollar during the year ended December 31, 2019.

In order to manage currency fluctuations, Kennedy Wilson entered into currency derivative contracts to manage its exposure to currency fluctuations between its functional currency (U.S. dollar) and the functional currency (Euro and GBP) of certain of its wholly-owned and consolidated subsidiaries. See note 5 for a more detailed discussion of Kennedy Wilson's currency derivative contracts.

As discussed throughout this report and prior to the KWE Transaction, we were required under U.S. GAAP to consolidate certain non-wholly owned subsidiaries or investments that we controlled. As such, during the year ended December 31, 2017 our financial statements reflected currency translation adjustments and related hedging activities on a gross basis. In many instances, these fluctuations were not reflective of the actual foreign currency exposure of the underlying consolidated subsidiary.

and are presented separately on Kennedy Wilson's balance sheet. As of December 31, 2019 and 2018 the Company has noncontrolling interest of $40.5 million and $184.5 million, respectively. See Note 4 for additional details. The Company also allocated $94.4 million of income, $10.6 million of other comprehensive income and received contributions of $15.0 million to noncontrolling interest holders.