Prospect Acquisition (stock symbol: [t]PAX[/t]) cuts some deals to facilitate the approval of its proposed acquisition of Kennedy-Wilson:
Prospect Acquisition Corp. Announces Entry Into an Agreement With Victory Park and Entry Into Stock Purchase Agreements With Credit Suisse, Nisswa Acquisition Master Fund and Milton Arbitrage Partners
Press Release
Source: Prospect Acquisition Corp.
On 1:10 pm EST, Thursday November 12, 2009
NAPLES, Fla., Nov. 12 /PRNewswire-FirstCall/ -- Prospect Acquisition Corp. (Amex: PAX - News; the "Company" or "Prospect") announced today that it has entered into an agreement with Victory Park, a stock purchase agreement with Credit Suisse, a stock purchase agreement with Nisswa Acquisition Master Fund, and a share purchase agreement with Milton Arbitrage Partners.
Agreement with Victory Park
Prospect has entered into an agreement (the "Victory Agreement"), dated November 11, 2009, with Victory Park Capital Advisors, LLC ("Victory Park"), pursuant to which funds managed by Victory Park or other purchasers acceptable to Victory Park and Prospect may purchase up to an aggregate of 7,591,093 shares of Prospect's common stock from third parties prior to Prospect's special meeting of stockholders. Victory Park is not an affiliate of Prospect, its officers and directors and/or their respective affiliates, or Kennedy-Wilson, or its officers and directors and/or their respective affiliates. It is anticipated that Victory Park will effect purchases of Prospect common stock through independent, privately negotiated transactions with third parties who are institutions or other sophisticated investors that have voted against or indicated an intention to vote against the Merger (as defined herein) and the Agreement and Plan of Merger (the "Merger Agreement") by and among Prospect, KW Merger Sub Corp., a wholly-owned subsidiary of Prospect ("Merger Sub") and Kennedy-Wilson, Inc. ("Kennedy-Wilson"), pursuant to which Merger Sub will merge (the "Merger") with and into Kennedy-Wilson, with Kennedy-Wilson continuing as the surviving corporation and a wholly-owned subsidiary of Prospect. The purchase price for shares purchased pursuant to the Victory Agreement could exceed the market price by up to $0.04 per share.
Pursuant to the Victory Agreement, Prospect will pay Victory Park a fee of 1.0% of the total purchase price of all shares of Prospect's common stock purchased by Victory Park from third parties. In connection with each purchase of common stock by Victory Park pursuant to the Victory Agreement, Victory Park and Prospect will enter into a stock purchase agreement (each, a "Victory Purchase Agreement"), pursuant to which Prospect will agree to purchase such common stock from Victory Park at a price equal to the aggregate purchase price paid by Victory Park for such shares plus the 1.0% fee described above. No funds other than those payable to Victory Park may be released from the trust account containing the net proceeds of Prospect's initial public offering following the consummation of the Merger until Prospect has paid Victory Park pursuant to the Victory Purchase Agreements in full except to converting stockholders. Such purchases, if made, would increase the likelihood that holders of a majority of shares of Prospect's common stock will vote in favor of the Merger and the Merger Agreement and that holders of less than 30% of Prospect's common stock will vote against the Merger and the Merger Agreement and seek conversion of their Prospect common stock into cash in accordance with Prospect's amended and restated charter.
Agreement with Credit Suisse
Prospect also announced that it has entered into a Stock Purchase Agreement, dated November 12, 2009, with Credit Suisse Securities (USA) LLC ("Credit Suisse") to purchase an aggregate of 497,100 shares of Prospect common stock for a purchase price of $9.908 per share (the "Credit Suisse Purchase Agreement"). Credit Suisse is not an affiliate of Prospect, its officers and directors and/or their respective affiliates, or Kennedy-Wilson, or its officers and directors and/or their respective affiliates. Pursuant to the Credit Suisse Purchase Agreement, Credit Suisse has agreed not to exercise its conversion rights and to grant a proxy to vote its Prospect common stock in favor of each of the proposals to be presented at Prospect's special meeting of stockholders, which proposals are set forth in Prospect's Proxy Statement/Prospectus.
The purchase of shares of Prospect common stock under the Credit Suisse Purchase Agreement may increase the likelihood that holders of a majority of shares of Prospect's common stock will vote in favor of the Merger and the Merger Agreement and that holders of less than 30% of Prospect common stock will vote against the Merger and the Merger Agreement and seek conversion of their common stock into cash in accordance with Prospect's amended and restated charter. The purchase of common stock pursuant to the Credit Suisse Purchase Agreement will take place concurrently with or following the closing of the Merger and will be paid for with funds that will be released from Prospect's trust account upon consummation of the Merger.
Agreement with Nisswa Acquisition Master Fund
Prospect announced that it has entered into a Stock Purchase Agreement, dated November 11, 2009, with Nisswa Acquisition Master Fund, Ltd. ("Nisswa") to purchase up to a maximum of 650,000 shares of Prospect common stock for a purchase price of $9.95 per share (the "Nisswa Purchase Agreement"). Nisswa is not an affiliate of Prospect, its officers and directors and/or their respective affiliates, or Kennedy-Wilson, or its officers and directors and/or their respective affiliates. Pursuant to the Nisswa Purchase Agreement, Nisswa has agreed not to exercise its conversion rights or, if it has already exercised its conversion rights, to withdraw and revoke such exercise.
The purchase of shares of Prospect common stock under the Nisswa Purchase Agreement may increase the likelihood that holders of less than 30% of Prospect common stock will seek conversion of their common stock into cash in accordance with Prospect's amended and restated charter. The purchase of common stock pursuant to the Nisswa Purchase Agreement will take place concurrently with or following the closing of the Merger and will be paid for with funds that will be released from Prospect's trust account upon consummation of the Merger.
Agreement with Milton Arbitrage Partners
Prospect also announced that it has entered into a Share Purchase Agreement, dated November 12, 2009, with Milton Arbitrage Partners, LLC ("Milton Partners") to purchase an aggregate of 832,900 shares of Prospect common stock for a purchase price of $9.95 per share (the "Milton Partners Purchase Agreement"). Milton Partners is not an affiliate of Prospect, its officers and directors and/or their respective affiliates, or Kennedy-Wilson, or its officers and directors and/or their respective affiliates. Pursuant to the Milton Partners Purchase Agreement, Milton Partners has agreed not to exercise its conversion rights and to grant a proxy to vote its Prospect common stock in favor of each of the proposals to be presented at Prospect's special meeting of stockholders, which proposals are set forth in Prospect's Proxy Statement/Prospectus.
The purchase of shares of Prospect common stock under the Milton Partners Purchase Agreement may increase the likelihood that holders of a majority of shares of Prospect's common stock will vote in favor of the Merger and the Merger Agreement and that holders of less than 30% of Prospect common stock will vote against the Merger and the Merger Agreement and seek conversion of their common stock into cash in accordance with Prospect's amended and restated charter. The purchase of common stock pursuant to the Milton Partners Purchase Agreement will take place concurrently with or following the closing of the Merger and will be paid for with funds that will be released from Prospect's trust account upon consummation of the Merger.
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