Exhibit 10.22
CONFIDENTIAL
September 4, 2009
David A. Minella
Chairman & CEO
Prospect Acquisition Corp.
9130 Galleria Court, Suite 318
Naples, FL 34109
Dear Mr. Minella:
We are pleased to confirm the arrangements under
which DE GUARDIOLA ADVISORS, INC. (“DGA”) is engaged by
PROSPECT ACQUISITION CORP. (the “Company”) as its
financial advisor in connection with a Transaction (defined below)
with the Target (defined below).
As used in this agreement, the term
“Target” shall refer to Kennedy
Wilson, Inc.
During the term of our engagement, DGA will
provide you with customary financial advice and assistance in
connection with this Transaction, including performing financial
analyses and assisting you in negotiating the financial and
contractual aspects of a Transaction. This engagement,
however, does not include the rendering of an opinion as to the
fairness of the consideration to be paid to the Target in a
Transaction, nor does it include the solicitation or recommendation
to purchase any securities of the Company or the Target.
DGA’s cash fee for this Transaction will
be $1,500,000. In addition, the Company will issue to DGA
375,000 shares, which will be substantially similar to the existing
Founders’ Shares (as defined in the Company’s offering
documents), which together with the cash fee, represent the
“Transaction Fee” that will be payable by the Company
only upon the closing of the transaction. The 375,000
Founders’ Shares included as part of the Transaction Fee will
be subject to adjustment as described in the Letter of Intent dated
July 12, 2009 and confirmed in either the forthcoming
definitive agreements between the Company and the Target or a
separate letter agreement.
As used in this agreement, the term
“Transaction” shall mean any merger, reverse merger,
acquisition, or other business combination involving the
Target.
The Company also agrees to reimburse DGA
periodically for its reasonable out-of-pocket expenses, including
all travel and other out-of-pocket expenses and fees and
disbursements. Notwithstanding the previous sentence, unless
otherwise agreed, the Company shall not be required to reimburse
DGA for any fees and disbursements to third party professionals
unless the Company shall have consented in writing to DGA retaining
them. This paragraph shall not apply to any expenses incurred
pursuant to Annex A hereof.
The Company recognizes and confirms that DGA, in
performing the service contemplated under this agreement, will be
relying on publicly available information and on information
furnished by the Company and/or the Target without independent
verification, that DGA will not assume responsibility for the
accuracy and completeness of such information, and that DGA will
not under this agreement undertake to make an independent appraisal
or valuation of any of the assets of the Target.
The Company’s interest in a Transaction,
the subject matter of this agreement and all confidential
information and data furnished to DGA by or at the request of the
Company, whether oral or written, will be maintained in confidence
by DGA and not disclosed to any third party, except as provided
herein, without the Company’s prior written consent, so long
as such information or data remains confidential, unless required
by applicable law or legal process. At the written request of
the Company, DGA will destroy all confidential information of the
Company in the event this agreement terminates.
In connection with an engagement such as this,
it is DGA’s policy to receive indemnification pursuant to the
provisions set forth in Annex A. The Company agrees to the
provisions with respect to our indemnity and other matters set
forth in Annex A, which is incorporated by reference into this
letter.
DGA acknowledges that, as contemplated by the
Company’s Prospectus dated November 14, 2007, the
Company established a trust account for the benefit of its public
stockholders and that the Company has agreed with its public
stockholders to obtain a waiver from all third party vendors and
prospective target businesses waiving any and all right, title,
interest or claim of any kind in or to any monies in the Trust
Account. DGA agrees to execute the waiver set forth in Annex
B on the date hereof.
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The Company also recognizes and acknowledges
that DGA will be providing advisory services and assistance to both
the Company and the Target in connection with this
transaction.
Any written or oral opinion or advice provided
by DGA in connection with our engagement is exclusively for the
information of the Board of Directors and senior management of the
Company and does not constitute a recommendation to any shareholder
of the Company concerning action that such shareholder might or
should take in connection with a Transaction. Such opinions
or advice may not be disclosed to any third party or circulated or
referred to publicly without our prior written consent. DGA
may, at our own expense, place announcements or advertisements in
financial newspapers, journals and marketing materials describing
our services hereunder.
The Company acknowledges that it is not relying
on the advice of DGA for tax, legal or accounting matters, it is
seeking and will rely on the advice of its own professionals and
advisors for such matters and it will make an independent analysis
and decision regarding any Transaction based upon such
advice.
The initial term of this agreement shall run six
(6) months from the execution of this agreement. The services
of DGA may be terminated at any time with or without cause
effective upon receipt of written notice to that effect. From
and after the date a termination notice is delivered to DGA
hereunder, DGA shall render no additional service to the Company
hereunder, except as otherwise agreed in writing by D
