Exhibit
10.1


 


AGREEMENT


 


THIS AGREEMENT (this “Agreement”), dated as of November 11, 2009, is made by
and among PROSPECT ACQUISITION CORP., a Delaware corporation (“Prospect”), and
VICTORY PARK CAPITAL ADVISORS, LLC, on behalf of one or more entities for which
it acts as investment manager and other purchasers acceptable to Victory Park
Capital Advisors, LLC and Prospect (collectively, “Victory Park”).


 


WHEREAS, Prospect was
organized for the purpose of acquiring, through a merger, capital stock
exchange, asset acquisition or other similar business combination, an operating
business in the financial services industry (“Business
Combination”);


 


WHEREAS, Prospect
consummated an initial public offering in November 2007 (“IPO”) in connection with which it raised gross proceeds of
approximately $250 million, a significant portion of which was placed in a
trust account maintained by Continental Stock Transfer and Trust Company
pending the consummation of a Business Combination, or the dissolution and
liquidation of Prospect in the event it is unable to consummate a Business
Combination on or prior to November 14, 2009;


 


WHEREAS, Prospect has
entered into that certain Agreement and Plan of Merger, dated September 8,
2009, among Prospect, KW Merger Sub Corp., Prospect’s wholly-owned subsidiary
formed for the purpose of consummating the merger (“Merger Sub”),
and Kennedy-Wilson, Inc. (“Kennedy-Wilson”),
as amended, which, among other things, provides for the merger of Merger Sub
with and into Kennedy-Wilson, with Kennedy-Wilson continuing as the surviving
corporation and becoming a direct wholly-owned subsidiary of Prospect (the “Merger”); and


 


WHEREAS, the approval of the
Merger is contingent upon, among other things, the affirmative vote of holders
of a majority of the outstanding common shares of Prospect which are present
and entitled to vote at the meeting called to approve the Merger;


 


WHEREAS, pursuant to certain
provisions in Prospect’s certificate of incorporation, a holder of shares of
Prospect’s common stock issued in the IPO may, if it votes against the Merger,
demand that Prospect convert such common shares into cash (“Conversion Rights”);


 


WHEREAS, the Merger cannot
be consummated if holders of 30% or more of the Prospect common stock issued in
the IPO exercise their Conversion Rights.


 


NOW, THEREFORE, the
undersigned parties agree as follows:


 


1.               Agreement to
Make Purchases of Prospect Common Stock.  Victory Park agrees to use its reasonable
best efforts to make simultaneous privately negotiated purchases of up to
approximately 7,591,093 shares of Prospect common stock at purchase prices not
to exceed $9.95 per share (at the discretion of Prospect) on or prior to November 11,
2009, provided that Prospect agrees to enter into the form of forward contract
(“Forward Contract”) attached hereto as Annex
A with the purchaser of such shares of common stock in connection
therewith. Prospect may reduce the number of shares that may be 


 

















 


purchased
by Victory Park; provided that, if Prospect reduces such number to less than
1,000,000 shares, Victory Park shall not be obligated to make any
purchases.  Purchases by Victory Park
shall not begin until after Prospect publicly announces the entering into of
this Agreement with respect to the Forward Contract.


 


2.               Fees.  In addition, in exchange for its services in
aggregating blocks of shares for purchase by Victory Park from Prospect
stockholders that have indicated an intention to convert their shares of
Prospect common stock and or vote against the Merger, Prospect shall pay to
Victory Park on the earlier of (i) the Closing Date (as defined in the
Forward Contract) or (ii) November 14, 2009, a fee equal to 1.0% of
the cost to Victory Park of all Prospect shares purchased by Victory Park from
third parties whether or not the Merger is consummated.


 


3.               Expenses. All costs and
expenses incurred in connection with the transactions contemplated by this
Agreement, including, without limitation, legal fees and expenses and all other
out-of-pocket costs and expenses of third parties incurred by a party in
connection with the negotiation and effectuation of the terms and conditions of
this Agreement and the transactions contemplated thereby, shall be the
obligation of the respective party incurring such fees and expenses; provided
that Prospect shall pay up to $25,000 of the costs and expenses incurred by
Victory Park in connection with the transactions contemplated by this
Agreement, it being understood that Prospect has, prior to the date hereof,
deposited $25,000 with Victory Park in furtherance of the foregoing.


 


4.               Counterparts.  This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.


 


5.               Governing Law; Jurisdiction.  This Agreement shall for all purposes be
deemed to be made under and shall be construed in accordance with the laws of
the State of New York.  Each of the
parties hereby agrees that any action, proceeding or claim against it arising
out of or relating in any way to this Agreement shall be brought and enforced
in the courts of the State of New York or the United States District Court for
the Southern District of New York, and irrevocably submits to such
jurisdiction, which jurisdiction shall be exclusive.  Each of the parties hereby waives any
objection to such exclusive jurisdiction and that such courts represent an
inconvenient forum and irrevocably waive trial by jury.


 


[Signature page to follow]


 

















 


IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.


 


 


	
   

  	
  PROSPECT ACQUISITION CORP.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David A. Minella

  
	
   

  	
  Name: David A. Minella

  
	
   

  	
  Title: Chief Executive
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  VICTORY PARK CAPITAL
  ADVISORS, LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Scott R. Zemmick

  
	
   

  	
  Name:  Scott R. Zemnick

  
	
   

  	
  Title:    General
  Counsel

  



 

















 


Annex A