Exhibit 10.8

 

EXECUTION COPY

 

INVESTMENT MANAGEMENT TRUST AGREEMENT

 

This Agreement is made as of November 14, 2007 by and between Prospect
Acquisition Corp., a Delaware corporation (the “Company”), and Continental Stock
Transfer & Trust Company (the “Trustee”).

 

WHEREAS, the Company’s registration statement on Form S-1, No. 333-145110
(“Registration Statement”), for its initial public offering of securities
(“IPO”) has been declared effective as of the date hereof (“Effective Date”) by
the Securities and Exchange Commission (capitalized terms used herein and not
otherwise defined shall have the meanings set forth in the Registration
Statement); and

 

WHEREAS, Citigroup Global Markets Inc. (“Citigroup”) is acting as the
representative of the several underwriters in the IPO (the “Underwriters”)
pursuant to an underwriting agreement dated on or about the date hereof between
the Company and Citigroup (the “Underwriting Agreement”); and

 

WHEREAS, as described in the Registration Statement, and in accordance with the
Company’s Certificate of Incorporation, $247,000,000 of the gross proceeds of
the IPO, including certain deferred underwriting discounts and commissions and
proceeds from the sale of the Sponsors’ Warrants (or $283,375,000 if the
underwriters’ over-allotment option is exercised in full or a pro rata portion
thereof pursuant to the terms of the Underwriting Agreement if the underwriters’
over-allotment option is exercised in part, but not in full, prior to the time
of its expiration), will be delivered to the Trustee to be deposited and held in
a trust account for the benefit of the Company and the holders of the Company’s
common stock, par value $.0001 per share, issued in the IPO as hereinafter
provided (the amount to be delivered to the Trustee will be referred to herein
as the “Property”, the stockholders for whose benefit the Trustee shall hold the
Property will be referred to as the “Public Stockholders,” and the Public
Stockholders and the Company will be referred to together as the
“Beneficiaries”);

 

WHEREAS, pursuant to the Underwriting Agreement, a portion of the Property equal
to $10,000,000 (or $11,500,000, if the underwriters’ over-allotment option is
exercised in full or a pro rata portion thereof pursuant to the terms of the
Underwriting Agreement if the underwriters’ over-allotment option is exercised
in part, but not in full, prior to the time of its expiration as specified in a
notice pursuant to Paragraph 3(e) hereof) is attributable to deferred
underwriting commissions that will become payable by the Company to Citigroup
upon the consummation of an Initial Business Combination (as defined in the
Registration Statement) (the “Deferred Discount”); and

 

WHEREAS, the Company and the Trustee desire to enter into this Agreement to set
forth the terms and conditions pursuant to which the Trustee shall hold the
Property;

 

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IT IS AGREED:

 

1.                                       Agreements and Covenants of Trustee.
The Trustee hereby agrees and covenants to:

 

(a)                                  Hold the Property in trust for the
Beneficiaries in accordance with the terms of this Agreement in a segregated
trust account (the “Trust Account”) established by the Trustee at JPMorgan
Chase, N.A.;

 

(b)                                 Manage, supervise and administer the Trust
Account subject to the terms and conditions set forth herein;

 

(c)                                  In a timely manner, upon the instruction of
the Company, to invest and reinvest the Property in United States “government
securities” within the meaning of Section 2(a)(16) of the Investment Company Act
of 1940 having a maturity of 180 days or less, and/or in any open ended
investment company registered under the Investment Company Act of 1940 that
holds itself out as a money market fund selected by the Company meeting the
conditions of paragraphs (c)(2), (c)(3) and (c)(4) of Rule 2a-7 promulgated
under the Investment Company Act of 1940, as determined by the Company;

 

(d)                                 Collect and receive, when due, all principal
and income arising from the Property, which shall become part of the “Property,”
as such term is used herein;

 

(e)                                  Notify the Company and Citigroup of all
communications received by it with respect to any Property requiring action by
the Company;

 

(f)                                    Supply any necessary information or
documents as may be requested by the Company in connection with the Company’s
preparation of the tax returns for the Trust Account;

 

(g)                                 Participate in any plan or proceeding for
protecting or enforcing any right or interest arising from the Property if, as
and when instructed by the Company to do so;

 

(h)                                 Render to the Company, and to such other
person as the Company may instruct, monthly written statements of the activities
of and amounts in the Trust Account reflecting all receipts and disbursements of
the Trust Account; and

 

(i)                                     Commence liquidation of the Trust
Account only after and promptly after receipt of, and only in accordance with,
the terms of a letter (each, a “Termination Letter”), in a form substantially
similar to that attached hereto as either Exhibit A or Exhibit B hereto, signed
on behalf of the Company by its Chief Executive Officer, Chief Financial
Officer, Secretary or Assistant Secretary or other authorized officer of the
Company, and complete the liquidation of the Trust Account and distribute the
Property in the Trust Account only as directed in the Termination Letter and the
other documents referred to therein; provided, however, that in the event that a
Termination Letter has not been received by the Trustee by the date which is
24-months after the date of the final prospectus for the IPO (the “Last Date”),
the Trust Account shall be liquidated in accordance with the procedures set
forth in the Termination Letter attached as Exhibit B hereto and distributed to
the stockholders of record on the Last Date. In all cases, the Trustee shall
provide Citigroup with a copy of any Termination Letters and/or any other
correspondence that it receives with respect to any proposed withdrawal from the
Trust Account

 

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promptly after it receives same. The provisions of this Section 1(i) may not be
modified, amended or deleted under any circumstances.

 

2.                                       Limited Distributions of Income from
Trust Account.

 

(a)                                  Upon written request from the Company,
which may be given from time to time in a form substantially similar to that
attached hereto as Exhibit C, the Trustee shall distribute to the Company the
amount requested by the Company to cover any income, franchise or other tax
obligation owed by the Company as a result of interest or other income earned on
the funds held in the Trust Account;

 

(b)                                 Upon written request from the Company, which
may be given from time to time in a form substantially similar to that attached
hereto as Exhibit D, the Trustee shall distribute to the Company the amount
requested by the Company to cover expenses related to investigating and
selecting a target business and other working capital requirements; provided,
however, that the aggregate amount of all such distributions shall not exceed
the lesser of (y) the aggregate amount of income actually received on amounts in
the Trust Account less an amount equal to estimated taxes that are or will be
due on such income at an assumed rate of 40% and (z) $2,750,000;

 

(c)                                  Distribute, upon notice by the Company, the
Deferred Discount, as defined in Section 3(e) to Citibank; and

 

(d)                                 The limited distributions referred to in
Sections 2(a) and 2(b) above shall be made only from interest collected on the
Property and, in the case of Section 2(b), the aggregate amount distributed by
the Trustee to the Company may not exceed $10,000,000, in the event the
Underwriters’ over-allotment option in the Offering is not exercised, or
$11,500,000 if the Underwriters’ over-allotment option in the Offering is
exercised in full (or, if the size of the Offering is increased or decreased,
such greater or lesser amount as shall be set forth in the Prospectus), less any
applicable income taxes on the Property. Except as provided in Section 1(i) and
this Section 2, no other distributions from the Trust Account shall be
permitted.

 

3.                                       Agreements and Covenants of the
Company. The Company hereby agrees and covenants to:

 

(a)                                  Give all instructions to the Trustee
hereunder in writing, signed by the Company’s Chief Executive Officer, Chief
Financial Officer or other authorized officer. In addition, except with respect
to its duties under paragraphs 1(i), 2(a) and 2(b) above, the Trustee shall be
entitled to rely on, and shall be protected in relying on, any verbal or
telephonic advice or instruction which it in good faith believes to be given by
any one of the persons authorized above to give written instructions, provided
that the Company shall promptly confirm such instructions in writing;

 

(b)                                 Hold the Trustee harmless and indemnify the
Trustee from and against, any and all expenses, including reasonable counsel
fees and disbursements, or loss suffered by the Trustee in connection with any
action, suit or other proceeding brought against the Trustee involving any
claim, or in connection with any claim or demand which in any way arises out of
or relates to this Agreement, the services of the Trustee hereunder, or the
Property or any income

 

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earned from investment of the Property, except for expenses and losses resulting
from the Trustee’s gross negligence or willful misconduct. Promptly after the
receipt by the Trustee of notice of demand or claim or the commencement of any
action, suit or proceeding, pursuant to which the Trustee intends to seek
indemnification under this paragraph, it shall notify the Company in writing of
such claim (hereinafter referred to as the “Indemnified Claim”). The Trustee
shall have the right to conduct and manage the defense against such Indemnified
Claim, provided, that the Trustee shall obtain the consent of the Company with
respect to the selection of counsel, which consent shall not be unreasonably
withheld. The Trustee may not agree to settle any Indemnified Claim without the
prior written consent of the Company, which consent shall not be unreasonably
withheld, unless such settlement includes a full release of the Company with
respect to such Indemnified Claim. The Company may participate in such action
with its own counsel;

 

(c)                                  Pay the Trustee an initial acceptance fee,
an annual fee and a transaction processing fee for each disbursement made
pursuant to Section 2 as set forth on Schedule A hereto, which fees shall be
subject to modification by the parties from time to time. It is expressly
understood that the Property shall not be used to pay such fees unless and until
it is distributed to the Company pursuant to Section 2. The Company shall pay
the Trustee the initial acceptance fee and first year’s fee at the consummation
of the IPO and thereafter on the anniversary of the Effective Date.  The Trustee
shall refund to the Company the annual fee (on a pro rata basis) with respect to
any period after the liquidation of the Trust Account. The Company shall not be
responsible for any other fees or charges of the Trustee except as set forth in
this Section 3(c) and as may be provided in Section 3(b) hereof (it being
expressly understood that the Property shall not be used to make any payments to
the Trustee under such Sections);

 

(d)                                 In connection with any vote of the Company’s
stockholders regarding a Business Combination, provide to the Trustee an
affidavit or certificate of a firm regularly engaged in the business of
soliciting proxies and/or tabulating stockholder votes (which firm may be the
Trustee) verifying the vote of the Company’s stockholders regarding such
Business Combination; and

 

(e)                                  Within five business days after Citigroup’s
over-allotment option (or any unexercised portion thereof) expires or is
exercised in full, provide the Trustee with a notice in writing (with a copy to
Citigroup) of the total amount of the Deferred Discount to be released to
Citigroup upon consummation of an Initial Business Combination, which shall in
no event be less than $10,000,000.

 

4.                                       Limitations of Liability. The Trustee
shall have no responsibility or liability to:

 

(a)                                  Take any action with respect to the
Property, other than as directed in paragraphs 1 and 2 hereof and the Trustee
shall have no liability to any party except for liability arising out of its own
gross negligence or willful misconduct;

 

(b)                                 Institute any proceeding for the collection
of any principal and income arising from, or institute, appear in or defend any
proceeding of any kind with respect to, any of the Property unless and until it
shall have received instructions from the Company given as

 

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provided herein to do so and the Company shall have advanced or guaranteed to it
funds sufficient to pay any expenses incident thereto;

 

(c)                                  Change the investment of any Property,
other than in compliance with paragraph 1(c);

 

(d)                                 Refund any depreciation in principal of any
Property;

 

(e)                                  Assume that the authority of any person
designated by the Company to give instructions hereunder shall not be continuing
unless provided otherwise in such designation, or unless the Company shall have
delivered a written revocation of such authority to the Trustee;

 

(f)                                    The other parties hereto or to anyone
else for any action taken or omitted by it, or any action suffered by it to be
taken or omitted, in good faith and in the exercise of its own best judgment,
except for its gross negligence or willful misconduct. The Trustee may rely
conclusively and shall be protected in acting upon any order, notice, demand,
certificate, opinion or advice of counsel (including counsel chosen by the
Trustee), statement, instrument, report or other paper or document (not only as
to its due execution and the validity and effectiveness of its provisions, but
also as to the truth and acceptability of any information therein contained)
which is believed by the Trustee, in good faith, to be genuine and to be signed
or presented by the proper person or persons. The Trustee shall not be bound by
any notice or demand, or any waiver, modification, termination or rescission of
this Agreement or any of the terms hereof, unless evidenced by a written
instrument delivered to the Trustee signed by the proper party or parties and,
if the duties or rights of the Trustee are affected, unless it shall give its
prior written consent thereto;

 

(g)                                 Verify the correctness of the information
set forth in the Registration Statement or to confirm or assure that any
acquisition made by the Company or any other action taken by it is as
contemplated by the Registration Statement it being understood that the
foregoing shall not limit the Trustee’s obligation to act upon such requests for
distribution; and

 

(h)                                 File information returns with the United
States Internal Revenue Service and payee statements with the Company,
documenting the taxes payable by the Company, if any, relating to interest
earned on the Property.

 

(i)                                     Prepare, execute and file tax reports,
income or other tax returns and pay any taxes with respect to income and
activities relating to the Trust Account, regardless of whether such tax is
payable by the Trust Account or the Company (including, but not limited to,
income tax obligations), it being expressly understood that as set forth in
Section 1(i), if there is any income or other tax obligation relating to the
Trust Account or the Property in the Trust Account, as determined from time to
time by the Company and regardless of whether such tax is payable by the Company
or the Trust, at the written instruction of the Company, the Trustee shall make
funds available in cash from the Property in the Trust Account an amount
specified by the Company as owing to the applicable taxing authority, which
amount shall be paid directly to the company by electronic funds transfer,
account debit or other method of payment, and the Company shall forward such
payment to the applicable taxing authority.

 

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5.                                       Termination. This Agreement shall
terminate as follows:

 

(a)                                  If the Trustee gives written notice to the
Company that it desires to resign under this Agreement, the Company shall use
its reasonable efforts to locate a successor trustee. At such time that the
Company notifies the Trustee that a successor trustee has been appointed by the
Company and has agreed to become subject to the terms of this Agreement, the
Trustee shall transfer the management of the Trust Account to the successor
trustee, including but not limited to the transfer of copies of the reports and
statements relating to the Trust Account, whereupon this Agreement shall
terminate; provided, however, that, in the event that the Company does not
locate a successor trustee within ninety days of receipt of the resignation
notice from the Trustee, the Trustee may submit an application to have the
Property deposited with any court in the State of New York or with the United
States District Court for the Southern District of New York and upon such
deposit, the Trustee shall be immune from any liability whatsoever; or

 

(b)                                 At such time that the Trustee has completed
the liquidation of the Trust Account in accordance with the provisions of
paragraph 1(i) hereof, and distributed the Property in accordance with the
provisions of the Termination Letter, this Agreement shall terminate except with
respect to Paragraph 3(b).

 

6.                                       Trust Account Waiver.  The Trustee has
no right, title, interest, or claim of any kind (“Claim”) in or to any monies or
Property in the Trust Account, and hereby waives any Claim in or to any monies
or Property in the Trust Account it may have in the future, and hereby agrees
not to seek recourse, reimbursement, payment or satisfaction for any Claim
against the Trust Account for any reason whatsoever.

 

7.                                       Miscellaneous.

 

(a)                                  The Company and the Trustee each
acknowledge that the Trustee will follow the security procedures set forth below
with respect to funds transferred from the Trust Account. Upon receipt of
written instructions, the Trustee will confirm such instructions with an
Authorized Individual at an Authorized Telephone Number listed on the attached
Exhibit E. The Company and the Trustee will each restrict access to confidential
information relating to such security procedures to authorized persons. Each
party must notify the other party immediately if it has reason to believe
unauthorized persons may have obtained access to such information, or of any
change in its authorized personnel. In executing funds transfers, the Trustee
will rely upon account numbers or other identifying numbers of a beneficiary,
beneficiary’s bank or intermediary bank, rather than names. The Trustee shall
not be liable for any loss, liability or expense resulting from any error in an
account number or other identifying number, provided it has accurately
transmitted the numbers provided.

 

(b)                                 This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of New York,
without giving effect to conflicts of law principles that would result in the
application of the substantive laws of another jurisdiction. It may be executed
in several original or facsimile counterparts, each one of which shall
constitute an original, and together shall constitute but one instrument.

 

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(c)                                  This Agreement contains the entire
agreement and understanding of the parties hereto with respect to the subject
matter hereof. Except for Section 1(i) (which may not be amended under any
circumstances), this Agreement or any provision hereof may only be changed,
amended or modified by a writing signed by each of the parties hereto; provided,
however, that no such change, amendment or modification may be made without the
prior written consent of the Public Stockholders, it being the specific
intention of the parties hereto that each Public Stockholder is and shall be a
third-party beneficiary of this paragraph 7(c) with the same right and power to
enforce this paragraph 7(c) as either of the parties hereto, and provided,
further, that this Agreement may not be changed, waived, amended or modified in
such a manner as to adversely affect the right of the Underwriters to receive
the Deferred Discount as contemplated herein without the written consent of
Citigroup. For purposes of this paragraph 6(c), the “consent of the Public
Stockholders” shall mean receipt by the Trustee of a certificate from an entity
certifying that (i) such entity regularly engages in the business of serving as
inspector of elections for companies whose securities are publicly traded, and
(ii) either (a) 70% of the Public Stockholders of record as of a record date
established in accordance with Section 213(a) of the Delaware General
Corporation Law, as amended (the “DGCL”), have voted in favor of such amendment
or modification or (b) 70% of the Public Stockholders of record as of a record
date established in accordance with Section 213(b) of the DGCL have delivered to
such entity a signed writing approving such amendment or modification. As to any
claim, cross-claim or counterclaim in any way relating to this Agreement, each
party waives the right to trial by jury.

 

(d)                                 The parties hereto consent to the
jurisdiction and venue of any state or federal court located in the City of New
York, Borough of Manhattan, for purposes of resolving any disputes hereunder.

 

(e)                                  Any notice, consent or request to be given
in connection with any of the terms or provisions of this Agreement shall be in
writing and shall be sent by express mail or similar private courier service, by
certified mail (return receipt requested), by hand delivery or by facsimile
transmission:

 

if to the Trustee, to:

Continental Stock Transfer & Trust Company

 

17 Battery Place

 

New York, New York 10004

 

Attn: Steven G. Nelson and Frank DiPaolo

 

Fax No.: (212) 509-5150

 

if to the Company, to:

Prospect Acquisition Corp.

 

695 East Main Street

 

Stamford, Connecticut 06901

 

Attn: Chief Executive Officer

 

Fax No.: (203) 656-0051

 

in either case,

 

with a copy to:

Citigroup Global Markets Inc.

 

388 Greenwich Street

 

New York, New York 10013

 

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Attn: General Counsel

 

Fax No.: (212) 816-7912

 

and

Bingham McCutchen LLP

 

399 Park Avenue

 

New York, New York 10022

 

Attn: Floyd I. Wittlin, Esq.

 

Fax No.: (212) 752-5378

 

(f)                                    This Agreement may not be assigned by the
Trustee without the prior consent of the Company and Citigroup.

 

(g)                                 Each of the Trustee and the Company hereby
represents that it has the full right and power and has been duly authorized to
enter into this Agreement and to perform its respective obligations as
contemplated hereunder. The Trustee acknowledges and agrees that it shall not
make any claims or proceed against the Trust Account, including by way of
set-off, and shall not be entitled to any funds in the Trust Account under any
circumstance.

 

(h)                                 Each of the Company and the Trustee hereby
acknowledge that Citigroup is a third party beneficiary of this Agreement.

 

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the parties have duly executed this Investment Management
Trust Agreement as of the date first written above.

 

 

CONTINENTAL STOCK TRANSFER

 

& TRUST COMPANY, as Trustee

 

 

 

 

 

 

 

By:

  /s/ Steven Nelson

 

Name:

  Steven Nelson

 

Title:

  Chairman, President, Secretary

 

 

 

 

 

 

 

PROSPECT ACQUISITION CORP.

 

 

 

 

By:

  /s/ David A. Minella

 

Name:

  David A. Minella

 

Title:

  Chief Executive Officer

 

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SCHEDULE A

 

Fee Item

 

Time and method of payment

 

Amount

 

Initial acceptance fee

 

Initial closing of IPO by wire transfer

 

$

1,000

 

Annual fee

 

First year, initial closing of IPO by wire transfer; thereafter on the
anniversary of the effective date of the IPO by wire transfer or check

 

$

3,000

 

 

 

 

 

 

 

 

Transaction processing fee for disbursements to Company under Section 2

 

Deduction by Trustee from accumulated income following disbursement made to
Company under Section 2

 

$

250

 

 

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EXHIBIT A

 

[Letterhead of Company]

 

[Insert date]

 

Continental Stock Transfer & Trust Company

17 Battery Place

New York, New York 10004

Attn:  Steven Nelson and Frank DiPaolo

 

Re: Trust Account No.                                            Termination
Letter

 

Gentlemen:

 

Pursuant to paragraph 1(i) of the Investment Management Trust Agreement between
Prospect Acquisition Corp. (“Company”) and Continental Stock Transfer & Trust
Company (“Trustee”), dated as of                               , 2007 (“Trust
Agreement”), this is to advise you that the Company has entered into an
agreement (“Business Agreement”) with
                                                           (“Target Business”)
to consummate a business combination with Target Business (“Business
Combination”) on or about [insert date]. The Company shall notify you at least
48 hours in advance of the actual date of the consummation of the Business
Combination (“Consummation Date”).

 

In accordance with the terms of the Trust Agreement, we hereby authorize you to
commence liquidation of the Trust Account to the effect that, on the
Consummation Date, all of funds held in the Trust Account will be immediately
available for transfer to the account or accounts that the Company shall direct
on the Consummation Date.

 

On the Consummation Date (i) counsel for the Company shall deliver to you
written notification that the Business Combination has been consummated
(“Counsel’s Letter”), (ii) the Company shall deliver to you (a) [an affidavit]
[a certificate] of                                   , which verifies the vote
of the Company’s stockholders in connection with the Business Combination and
(b) written instructions with respect to the transfer of the funds held in the
Trust Account other than the Deferred Discount (“Instruction Letter”) and
(iii) Citigroup shall deliver to you written instructions for delivery of the
Deferred Discount. You are hereby directed and authorized to transfer the funds
held in the Trust Account immediately upon your receipt of the Counsel’s Letter
and the Instruction Letter.  In the event that certain deposits held in the
Trust Account may not be liquidated by the Consummation Date without penalty,
you will notify the Company of the same and the Company shall direct you as to
whether such funds should remain in the Trust Account and distributed after the
Consummation Date to the Company. Upon the distribution of all the funds in the
Trust Account pursuant to the terms hereof, the Trust Agreement shall be
terminated and the Trust Account closed.

 

In the event that the Business Combination is not consummated on the
Consummation Date described in the notice thereof and we have not notified you
on or before the original Consummation Date of a new Consummation Date, then,
upon receipt of written instruction from the Company, the funds held in the
Trust Account shall be reinvested as provided in the

 

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Trust Agreement on the business day immediately following the Consummation Date
as set forth in the notice.

 

 

Very truly yours,

 

 

 

PROSPECT ACQUISITION CORP.

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

cc: Citigroup Global Markets Inc.

 

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EXHIBIT B

 

[Letterhead of Company]

 

[Insert date]

 

Continental Stock Transfer & Trust Company

17 Battery Place

New York, New York 10004

Attn: Steven Nelson and Frank DiPaolo

 

Re: Trust Account No.                        Termination Letter

 

Gentlemen:

 

Pursuant to paragraph 1(i) of the Investment Management Trust Agreement between
Prospect Acquisition Corp. (“Company”) and Continental Stock Transfer & Trust
Company (“Trustee”), dated as of                           , 2007 (“Trust
Agreement”), this is to advise you that the Company has been unable to effect a
Business Combination with a Target Company within the time frame specified in
the Company’s Certificate of Incorporation, as described in the Company’s
prospectus relating to its IPO.

 

In accordance with the terms of the Trust Agreement, we hereby authorize you, to
commence liquidation of the Trust Account. You will notify the Company in
writing as to when all of the funds in the Trust Account will be available for
immediate transfer (the “Transfer Date”) in accordance with the terms of the
Trust Agreement and the Certificate of Incorporation of the Company.  You shall
commence distribution of such funds in accordance with the Trust Agreement and
the Certificate of Incorporation of the Company and you shall oversee the
distribution of the funds.  Upon the distribution of all the funds in the Trust
Account, your obligations under the Trust Agreement shall be terminated.

 

 

Very truly yours,

 

 

 

PROSPECT ACQUISITION CORP.

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

cc: Citigroup Global Markets Inc.

 

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EXHIBIT C

 

[Letterhead of Company]

 

[Insert date]

 

Continental Stock Transfer & Trust Company

17 Battery Place

New York, New York 10004

Attn: Frank DiPaolo and Cynthia Jordan

 

Re: Trust Account No.

 

Gentlemen:

 

Pursuant to paragraph 2(a) of the Investment Management Trust Agreement between
Prospect Acquisition Corp. (“Company”) and Continental Stock Transfer & Trust
Company (“Trustee”), dated as of                             , 2007 (“Trust
Agreement”), this is to advise you that the Company hereby requests that you
deliver to the Company $                              of the income earned and
collected on the Property as of the date hereof. The Company needs such funds to
pay for the tax obligations as set forth on the attached tax return or tax
statement. In accordance with the terms of the Trust Agreement, you are hereby
directed and authorized to transfer (via wire transfer) such funds promptly upon
your receipt of this letter to the Company’s operating account at:

 

[WIRE INSTRUCTION INFORMATION]

 

 

Very truly yours,

 

 

 

PROSPECT ACQUISITION CORP.

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

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EXHIBIT D

 

[Letterhead of Company]

 

[Insert date]

 

Continental Stock Transfer & Trust Company

17 Battery Place

New York, New York 10004

Attn: Frank DiPaolo and Cynthia Jordan

 

Re: Trust Account No.

 

Gentlemen:

 

Pursuant to paragraph 2(b) of the Investment Management Trust Agreement between
Prospect Acquisition Corp. (“Company”) and Continental Stock Transfer & Trust
Company (“Trustee”), dated as of                         , 2007 (“Trust
Agreement”), this is to advise you that the Company hereby requests that you
deliver to the Company $                          of the income earned and
collected on the Property as of the date hereof, which does not exceed, in the
aggregate with all such prior disbursements pursuant to paragraph 2(b), if any,
the maximum amount set forth in paragraph 2(b). The Company needs such funds to
cover its expenses relating to investigating and selecting a target business and
other working capital requirements. In accordance with the terms of the Trust
Agreement, you are hereby directed and authorized to transfer (via wire
transfer) such funds promptly upon your receipt of this letter to the Company’s
operating account at:

 

[WIRE INSTRUCTION INFORMATION]

 

 

Very truly yours,

 

 

 

PROSPECT ACQUISITION CORP.

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

cc: Citigroup Global Markets Inc.

 

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EXHIBIT E

 

AUTHORIZED INDIVIDUAL(S) FOR TELEPHONE CALL BACK

 

AUTHORIZED TELEPHONE NUMBER(S)

 

 

 

Company:

 

(203) 363-0885

 

 

 

Prospect Acquisition Corp.
695 East Main Street
Stamford, Connecticut 06901
Attn: Chief Financial Officer

 

 

 

 

 

Trustee:

 

(212) 845-3200

 

 

 

Continental Stock Transfer & Trust Company
17 Battery Place
New York, New York 10004
Attn: Frank DiPaolo, CFO

 

 

 

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