8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): June 13, 2017

KENNEDY-WILSON HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

001-33824	Delaware	26-0508760
(Commission File Number)	(State or Other Jurisdiction of Incorporation)	(IRS Employer Identification No.)
151 S. El Camino Drive Beverly Hills, California		90212
(Address of principal executive offices)		(Zip Code)

(310) 887-6400

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☒ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company:  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Item 1.01. Entry into a Material Definitive Agreement.

New Offer Announcement

On June 13, 2017, Kennedy-Wilson Holdings, Inc. (“KWH”) issued an announcement (the “New Offer Announcement”) pursuant to Rule 2.7 of the United Kingdom City Code on Takeovers and Mergers (the “Code”) disclosing an agreement between KWH and Kennedy Wilson Europe Real Estate plc, a public limited company registered in Jersey (“KWE”), to make available a new alternative proposal in connection with KWH’s previously announced recommended offer to acquire all of the outstanding shares (other than shares owned by KWH or its subsidiaries or held in treasury) of KWE (the “Transaction”) by means of a court sanctioned scheme of arrangement under Article 125 of the Companies (Jersey) Law 1991 (the “Scheme”).

Under the terms of KWH’s previously announced recommended offer, KWE shareholders would be entitled to receive, for each KWE ordinary share, 0.667 shares of KWH common stock (the “Original Consideration”). Under the terms of the New Offer Announcement, KWE shareholders would have the option of electing to receive either: (i) the Original Consideration; or (ii) a mixed consideration (the “New Offer”) consisting of (a) 300 pence in cash, to be paid by KWH (the “KWH Cash Component”); (b) 250 pence in cash, to be paid by KWE as a special distribution on or around closing of the Transaction (the “KWE Special Distribution”); and (c) 0.3854 shares of KWH common stock. KWH will be required to publish a prospectus in the United Kingdom in respect of the shares of KWH common stock to be issued in connection with the New Offer (the “Prospectus”). The availability of the New Offer to KWE shareholders would be conditional upon, among other things, the publication of and approval by the UK Listing Authority of the Prospectus. KWH will provide a mix and match facility (the “Mix and Match Facility”) under which KWE shareholders (other than certain overseas shareholders) who elect to receive the New Offer may, subject to off-setting elections made by other KWE shareholders, elect to vary the proportion of shares of KWH common stock and cash (but not the KWE Special Distribution) received pursuant to the Transaction. Based on the terms of the New Offer Announcement, if all KWE shareholders elected to receive the New Offer, KWE shareholders (other than KWH and its affiliates) would own approximately 24% and existing KWH shareholders would own approximately 76% of the combined group following the completion of the Transaction.

The New Offer Announcement also discloses receipt of the Irrevocable Undertakings (as described below in this Item 1.01) and non-binding statements of support of the Transaction by certain stockholders of KWH and shareholders of KWE (as described below in Item 8.01).

The foregoing summary of the Transaction and the New Offer Announcement does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the New Offer Announcement, which is included as Exhibit 2.1 to this Current Report on Form 8-K and incorporated herein by reference.

Irrevocable Undertakings

In connection with the Transaction, KWH has received irrevocable undertakings (the “Irrevocable Undertakings”) from Quantum Strategic Partners Ltd. (“Quantum”) and Franklin Templeton Institutional, LLC (“Franklin”) to vote all of their KWE shares in favor of the Scheme and other KWE shareholder resolutions required to implement the Transaction. These shareholders hold, in the aggregate, approximately 21.8% of the issued and outstanding KWE shares as of June 12, 2017, or approximately 28.6% of the shares of KWE shares entitled to vote on the Transaction.

In addition, each of Quantum and Franklin has agreed to refrain (subject to certain terms, conditions and exceptions specified in the Irrevocable Undertakings) from: (i) selling any KWE shares currently held by it or any further such shares it may acquire; (ii) acquiring any KWE shares; (iii) selling any KWE shares short or entering into any short derivative position referenced to them; or (iv) soliciting, directly or indirectly, or initiating discussions with a third party in connection with a competing offer for KWE. Franklin will be permitted to sell KWE shares if it is instructed to do so by clients on whose accounts it holds those KWE shares.

The Irrevocable Undertakings will terminate if, among other things, a third party announces its intention, prior to the KWE shareholder meeting in respect of the Scheme, to make an offer for KWE (or, in the case of Quantum, an offer for KWE or substantially all of KWE’s business and assets) which, in the reasonable opinion of the shareholder, represents an improvement on the New Offer.

The foregoing summary of the Irrevocable Undertakings does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Irrevocable Undertakings, which are attached as Exhibits 99.1 and 99.2, respectively, to this Form 8-K and are incorporated herein by reference

Item 3.02. Unregistered Sales of Equity Securities.

The KWH shares of common stock to be issued in connection with the Transaction will be issued pursuant to the exemption from registration provided by Section 3(a)(10) under the Securities Act of 1933, as amended. KWH reserves the right, subject to the prior consent of the Panel, to elect to implement the Transaction by way of a Takeover Offer (as defined in Article 116 of the Companies (Jersey) Law 1991), in which event, unless another exemption from registration were available, KWH would file a registration statement with the SEC containing a prospectus with respect to the KWH shares of common stock that would be issued in the Transaction.

Item 8.01 Other Events

Stockholder and Shareholder Statements of Intention to Vote in Favor of Transaction

In connection with the New Offer Announcement, certain stockholders of KWH including Fairfax Financial Holdings Limited, Elkhorn Partners LP, as well as all of the directors and executive officers of KWH who own shares of KWH common stock, have expressed to KWH their intention to vote all shares of KWH common stock beneficially owned by them in favor of any proposal to approve the issuance of shares of KWH common stock in connection with the Transaction. Collectively, these stockholders own approximately 31.4% of the outstanding shares of KWH common stock as of June 12, 2017 (including 17.1% of KWH’s outstanding shares owned by directors and executive officers of KWH). These statements of intention are not legally binding.

Also as disclosed in the New Offer Announcement, certain shareholders of KWE affiliated with Värde Partners, Inc. (the “Värde Shareholders”) have indicated by letter to KWH their intention to vote all of their KWE shares in favor of the Scheme and other KWE shareholder resolutions required to implement the Transaction (the “Värde Letter of Intent”). The Värde shareholders hold, in the aggregate, approximately 5.6% of the issued and outstanding KWE shares as of June 12, 2017, or approximately 7.3% of the shares of KWE shares entitled to vote on the Transaction. The Värde Letter of Intent is not legally binding. The foregoing summary of the Värde Letter of Intent does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Värde Letter of Intent, which is included as Exhibit 99.3 to this Current Report on Form 8-K and incorporated herein by reference.

Cash Confirmation

Under the Code, KWH’s financial advisor, Goldman Sachs International (“Goldman Sachs”), is required to make a public statement (the “Cash Confirmation Statement”) to the UK Panel on Takeovers and Mergers (the “Panel”) to the effect that KWH has sufficient resources to satisfy the KWH Cash Component payable pursuant to the terms of the Transaction. To enable Goldman Sachs to provide the Cash Confirmation Statement, KWH has: (i) agreed to deposit the KWH Cash Component payable to the shareholders of KWE into a blocked escrow account and (ii) executed and delivered a cash confirmation representation letter (the “Cash Confirmation Representation Letter”) to Goldman Sachs.

Under the Cash Confirmation Representation Letter, KWH has given various representations, warranties and undertakings to Goldman Sachs in relation to the sources and availability of the funding of the KWH Cash Component. Among other things, KWH has: (i) represented to Goldman Sachs that it is solvent, has the power and ability to perform its obligations under the Cash Confirmation Representation Letter, and is not aware of any circumstance which is likely to restrict its ability to pay the KWH Cash Component; (ii) undertaken to provide

Goldman Sachs with such information as Goldman Sachs may reasonably request in connection with the Transaction and its financing; and (iii) undertaken not to, and to cause its subsidiaries not to, take certain actions without obtaining the prior consent of Goldman Sachs, including acquiring any KWE shares, subject to certain exceptions, and varying the terms of the Transaction.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

2.1	New Offer Announcement, dated June 13, 2017.
99.1	Deed of Irrevocable Undertaking, dated June 13, 2017 of Quantum Strategic Partners Ltd.
99.2	Deed of Irrevocable Undertaking, dated June 13, 2017 of Franklin Templeton Institutional, LLC.
99.3	Värde Letter of Intent, dated June 13, 2017.

Additional Information and Where to Find It

This communication may be deemed to be solicitation material in respect of the Transaction, including the issuance of shares of KWH common stock in respect of the Transaction. In connection with such proposed share issuance, KWH expects to file a proxy statement on Schedule 14A with the Securities and Exchange Commission (the “SEC”). To the extent KWH effects the Transaction as a scheme of arrangement under Jersey law, the issuance of KWH common stock would not be expected to require registration under the Securities Act of 1933, as amended (the “Securities Act”), as a result of an exemption provided by Section 3(a)(10) under the Securities Act. In the event that KWH determines to effect the Transaction pursuant to a takeover offer or otherwise in a manner that is not exempt from the registration requirements of the Securities Act, it will file a registration statement with the SEC containing a prospectus with respect to the shares that would be issued in such transaction. INVESTORS AND SECURITY HOLDERS OF KWH ARE URGED TO READ THESE MATERIALS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE TRANSACTION THAT KWH WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT KWH, THE PROPOSED ISSUANCE OF KWH COMMON STOCK AND THE TRANSACTION. The preliminary proxy statement, the definitive proxy statement, in each case as applicable, and other relevant materials in connection with the proposed issuance of shares of KWH common stock and the Transaction (when they become available), and, if required, the registration statement/prospectus and other documents filed by KWH with the SEC, may be obtained free of charge at the SEC’s website at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents filed with the SEC at KWH’s website, ir.kennedywilson.com, or by contacting KWH’s Investor Relations department in writing at 151 S. El Camino Drive, Beverly Hills, CA 90212.

KWH, KWE, their respective directors and certain KWH executive officers may be deemed to be participants in the solicitation of proxies from KWH shareholders with respect to the Transaction, including the proposed issuance of shares of KWH common stock. Information about KWH’s directors and executive officers and their ownership of KWH shares and KWE shares or securities referencing KWE shares is provided in KWH’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016, which was filed with the SEC on February 27, 2017, KWH’s proxy statement for its 2017 Annual Meeting of Stockholders, which was filed with the SEC on April 28, 2017, and KWE’s Annual Report for the year ended December 31, 2016, which was filed with the SEC by KWH on Form 8-K on March 23, 2017. Information about the directors of KWE is provided in KWE’s Annual Report for the year ended December 31, 2016, which was filed with the SEC by KWH on Form 8-K on March 23, 2017. Information regarding the identity of the potential participants, and their direct or indirect interests in the solicitation, by security holdings or otherwise, will be provided in the proxy statement and other materials to be filed with the SEC in connection with the Transaction and issuance of shares of KWH common stock.

Forward-Looking Statements

This Current Report on Form 8-K, and the documents incorporated by reference into this Current Report, contains “forward-looking” statements concerning future events and financial performance. These forward-looking statements are necessarily estimates reflecting the judgment of senior management based on current estimates, expectations, forecasts and projections and include comments that express current opinions about trends and factors that may impact future operating results. Disclosures that use words such as “believe,” “anticipate,” “estimate,” “intend,” “could,” “plan,” “expect,” “project” or the negative of these, as well as similar expressions, are intended to identify forward-looking statements.

Forward-looking statements are not guarantees of future performance, rely on a number of assumptions concerning future events, many of which are outside of the companies’ control, and involve known and unknown risks and uncertainties that could cause actual results, performance or achievement, or industry results, to differ materially from any future results, performance or achievements, expressed or implied by such forward-looking statements. No assurance can be given that the proposed Transaction will happen as anticipated or at all. In evaluating these statements, you should specifically consider the risks referred to in our filings with the SEC, including our Form 10-K, which are available on our website and at www.sec.gov, including, but not limited to, the following factors: the occurrence of any event, change or other circumstance that could result in abandonment of the Transaction; the inability to complete the Transaction in a timely manner or at all, including as a result of the failure by one or both parties to obtain the requisite shareholder approvals; difficulties in successfully integrating the two companies following completion of the Transaction and the risk of not fully realizing expected synergies from the Transaction in the time frame expected or at all; the risk that the announcement and pendency of the Transaction disrupts current plans and operations, increases operating costs, results in management distraction or difficulties in establishing and maintaining relationships with third parties or makes employee retention and incentivization more difficult; the outcome of any legal proceedings that may be instituted against the companies in connection with the announcement and pendency of the Transaction; any limitations on the companies’ ability to operate their businesses during the pendency of the Transaction; disruptions in general economic and business conditions, particularly in geographies where the companies’ respective businesses may be concentrated; volatility and disruption of the capital and credit markets, higher interest rates, higher loan costs, less desirable loan terms and a reduction in the availability of mortgage loans, all of which could increase costs and could limit the companies’ ability to acquire additional real estate assets; continued high levels of, or increases in, unemployment and general slowdowns in commercial activity; the companies’ leverage and ability to refinance existing indebtedness or incur additional indebtedness; an increase in the companies’ debt service obligations; the companies’ ability to generate a sufficient amount of cash from operations to satisfy working capital requirements and to service their existing and future indebtedness; the companies’ ability to achieve improvements in operating efficiency; foreign currency fluctuations; adverse changes in the securities markets; the companies’ ability to retain their senior management and attract and retain qualified and experienced employees; the companies’ ability to retain major clients and renew related contracts; trends in use of large, full-service commercial real estate providers; changes in tax laws in the United States, Europe or Japan or other jurisdictions that reduce or eliminate deductions or other tax benefits the companies receive; the possibility that future acquisitions may not be available at favorable prices or upon advantageous terms and conditions; the companies’ ability to dispose of assets; and costs relating to the acquisition of assets the companies may acquire could be higher than anticipated. Except as required by law, KWH does not intend to update publicly any forward-looking statements, whether as a result of new information, future events, changes in assumptions or otherwise.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

KENNEDY-WILSON HOLDINGS, INC.
By:	/s/ Justin Enbody
Name:	Justin Enbody
Title:	Chief Financial Officer

Date: June 13, 2017

EXHIBIT INDEX

Exhibit Number	Description
2.1	New Offer Announcement, dated June 13, 2017.
99.1	Deed of Irrevocable Undertaking, dated June 13, 2017 of Quantum Strategic Partners Ltd.
99.2	Deed of Irrevocable Undertaking, dated June 13, 2017 of Franklin Templeton Institutional, LLC.
99.3	Värde Letter of Intent, dated June 13, 2017.

EX-2.1

Exhibit 2.1

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTO ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND NOT A PROSPECTUS OR PROSPECTUS EQUIVALENT DOCUMENT AND INVESTORS SHOULD NOT MAKE ANY INVESTMENT DECISION IN RELATION TO THE NEW KW SHARES EXCEPT ON THE BASIS OF INFORMATION IN THE SCHEME DOCUMENT AND THE PROSPECTUS WHICH ARE PROPOSED TO BE PUBLISHED IN DUE COURSE

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

FOR IMMEDIATE RELEASE

13 June 2017

RECOMMENDED MERGER OF

KENNEDY WILSON EUROPE REAL ESTATE PLC

AND

KENNEDY-WILSON HOLDINGS, INC.

NEW RECOMMENDED OFFER, ADDITIONAL SHAREHOLDER SUPPORT,

PROSPECTUS AND UPDATE ABOUT TIMING OF THE MERGER

Introduction

On 24 April 2017, Kennedy-Wilson Holdings, Inc. (“KW”) and the Independent Committee of Kennedy Wilson Europe Real Estate plc (“KWE”) published an announcement (the “Rule 2.7 Announcement”) relating to a proposed recommended all-share merger of KW and KWE (the “Merger”), which is to be implemented by means of a Court-sanctioned scheme of arrangement of KWE under Article 125 of the Jersey Companies Law (the “Original Offer”). Unless otherwise defined in this announcement, capitalised terms used but not defined in this announcement have the same meanings given to them in the Rule 2.7 Announcement. Except as otherwise stated in this announcement, all of the terms and conditions of the Merger, set out in the Rule 2.7 Announcement, remain as announced on 24 April 2017.

New Offer

The KW Board and the Independent Committee of KWE are pleased to announce that KW has agreed to make available a new alternative proposal (the “New Offer”), which will be available alongside the Original Offer. As set out in the Rule 2.7 Announcement, it was originally intended under the Original Offer that each KWE Scheme Shareholder would receive 0.667 New KW Shares for each KWE Scheme Share, with no cash being payable. Under the New Offer, a partial cash entitlement has been introduced and the exchange ratio has been amended. Accordingly, each KWE Scheme Shareholder will now have the option of electing to receive either:

under the Original Offer, for each KWE Scheme Share:	0.667 New KW Shares
OR
under the New Offer, for each KWE Scheme Share:	0.3854 New KW Shares (the “New KW Share Component”); 300 pence in cash, paid by KW (the “KW Cash Component”); and 250 pence in cash, paid by KWE by means of a special dividend (the “KWE Special Distribution”).

The KWE Special Distribution will be payable shortly after the Effective Date to those KWE Shareholders who become entitled, in respect of any KWE Share, to the consideration available under the New Offer and who are on KWE’s register of members at the Scheme Record Time. The KWE Special Distribution will be paid in addition to the other dividends contemplated in the Rule 2.7 Announcement (including the Closing Dividend). KWE Scheme Shareholders who elect to receive the Original Offer will not be entitled to receive the New KW Share Component, the KW Cash Component or the KWE Special Distribution. However, the dividend arrangements described in the Rule 2.7 Announcement will continue to apply.

Based on the Closing Price of US$19.55 per KW Share on 12 June 2017 (being the Business Day immediately prior to the publication of this announcement) (the “Latest Practicable Date”) and a £ / US$ exchange rate of 1.2656, the New Offer values each KWE Share at approximately 1,145 pence. Based on the Closing Price of US$19.55 per KW Share on the Latest Practicable Date and a £ / US$ exchange rate of 1.2656, the Original Offer values each KWE Share at approximately 1,030 pence.

If all KWE Scheme Shareholders elected to receive the New Offer, KWE Shareholders (other than KW and its affiliates) would own approximately 24% of the Combined Group and KW Shareholders would own approximately 76% of the Combined Group following completion of the Merger.

Additional shareholder support

KW has received additional irrevocable undertakings (the “Additional Irrevocable Undertakings”) from Quantum Strategic Partners Ltd. and Franklin Templeton Institutional, LLC (in its capacity as investment manager on behalf of certain funds and accounts managed by it) to vote in favour of the Scheme at the Scheme Court Meeting and the resolutions relating to the Merger at the KWE General Meeting (or, in the event that the Merger is implemented by way of a Takeover Offer, accept the Offer) in respect of their entire holdings, representing, in aggregate, approximately 21.8% of KWE’s existing ordinary share capital as at the Latest Practicable Date (or approximately 28.6% of the KWE Shares entitled to a vote at the Scheme Court Meeting and KWE General Meeting, as at the Latest Practicable Date).

KW has also received a letter of intent (the “Letter of Intent”) from the Värde Shareholders (as defined in Appendix 2), confirming their intention to vote in favour of the Scheme at the Scheme Court Meeting and the resolutions relating to the Merger at the KWE General Meeting (or, in the event that the Merger is implemented by way of a Takeover Offer, accept the Offer) in respect of their entire holdings, representing, in aggregate, approximately 5.6% of KWE’s existing ordinary share capital as at the Latest Practicable Date (or approximately 7.3% of the KWE Shares entitled to a vote at the Scheme Court Meeting and KWE General Meeting, as at the Latest Practicable Date).

Support from KWE Shareholders to vote in favour of the Scheme at the Scheme Court Meeting and the resolutions relating to the Merger at the KWE General Meeting (or, in the event that the Merger is implemented by way of a Takeover Offer, accept the Offer) has been received in respect of approximately 36.0% of the KWE Shares entitled to a vote at the Scheme Court Meeting and KWE General Meeting, as at the Latest Practicable Date.

Further details of the Additional Irrevocable Undertakings and the Letter of Intent are set out in Appendix 2 to this announcement and the full text of the Additional Irrevocable Undertakings and the Letter of Intent can be found online at http://ir.kennedywilson.com/kw-kwe-transaction.

In addition, Fairfax Financial Holdings Limited and Elkhorn Partners LP have indicated to KW that they intend to vote in favour of the KW Shareholder Resolution at the KW Special Meeting in respect of their entire holdings, representing, in aggregate, approximately 14.3% of KW’s outstanding shares of common stock as at the Latest Practicable Date.

The KW Directors, as well as Mary Ricks, Matt Windisch, In Ku Lee and Justin Enbody (being all of the executive officers of KW who hold KW Shares), also intend to vote in favour of the KW Shareholder Resolution at the KW Special Meeting in respect of their entire holdings, representing, in aggregate, approximately 17.1% of KW’s outstanding shares of common stock as at the Latest Practicable Date.

Support from KW Shareholders to vote in favour of the KW Shareholder Resolution at the KW Special Meeting has been received in respect of approximately 31.4% of KW’s outstanding shares of common stock as at the Latest Practicable Date.

Recommendation

The Independent Committee of KWE, which has been so advised by Rothschild and J.P. Morgan Cazenove as to the financial terms of the New Offer, considers the terms of the New Offer to be fair and reasonable. In providing their advice to the Independent Committee of KWE, Rothschild and J.P. Morgan Cazenove have taken into account the commercial assessments of the Independent Committee of KWE.

Accordingly, the members of the Independent Committee of KWE intend unanimously to recommend that KWE Shareholders vote in favour of the New Offer at the Scheme Court Meeting and the resolutions relating to the New Offer at the KWE General Meeting (or, in the event that the New Offer is implemented by way of a Takeover Offer, to recommend KWE Shareholders to accept such Offer).

For the avoidance of doubt, neither the Independent Committee of KWE nor Rothschild nor J.P. Morgan Cazenove express any view as to the advantages or disadvantages of the Merger as far as KW Shareholders are concerned.

Mix and match facility

KW will provide a mix and match facility under which KWE Scheme Shareholders (other than certain Overseas Shareholders) who elect to receive the New Offer may, subject to off-setting elections made by other KWE Scheme Shareholders who elect to receive the New Offer, elect to vary the proportion in which they receive the New KW Share Component and the KW Cash Component available under the New Offer (but not the KWE Special Distribution) (the “Mix and Match Facility”). The Mix and Match Facility will not change the total number of New KW Shares to be issued under the New Offer or the maximum amount of the KW Cash Component payable by KW under the New Offer.

Elections made by KWE Scheme Shareholders under the Mix and Match Facility will be satisfied only to the extent that other KWE Scheme Shareholders make off-setting elections. To the extent that elections cannot be satisfied in full, they will be scaled down on a pro rata basis. As a result, KWE Scheme Shareholders who make an election under the Mix and Match Facility will not know the exact number of New KW Shares or the amount of the KW Cash Component they will receive until settlement of the consideration due to them, although an announcement will be made of the approximate extent to which elections under the Mix and Match Facility will be satisfied.

The Mix and Match Facility will not affect the entitlement of any KWE Scheme Shareholder who does not make an election under the Mix and Match Facility or who elects to receive the Original Offer. Any such KWE Scheme Shareholder will receive, for each KWE Scheme Share it holds, either the consideration available under the New Offer without alteration or, as applicable, the consideration available under the Original Offer.

Further details of the Mix and Match Facility (including the action to take in order to make a valid election, the deadline for making elections, and the basis on which entitlement to receive cash may be exchanged for an entitlement to additional new KW Shares (or vice versa)) will be included in the Scheme Document.

The Mix and Match Facility is conditional upon the Merger becoming effective.

Prospectus and Jersey regulatory condition

KW will be required to publish a prospectus in the UK in respect of the New KW Shares to be issued to KWE Scheme Shareholders in connection with the New Offer (the “Prospectus”). It is expected that the Prospectus will be published at or around the same time as the Scheme Document is posted to KWE Shareholders.

As a result of the requirement to publish the Prospectus, in addition to the Conditions set out in Part A of Appendix 1 to the Rule 2.7 Announcement and the further terms and conditions set out in Part B of Appendix 1 to the Rule 2.7 Announcement, the New Offer is also conditional upon (a) (i) the Prospectus being approved by the UK Listing Authority and (ii) the Prospectus being made available to the public in accordance with the prospectus rules made by the Financial Conduct Authority under section 73A of the Financial Services and Markets Act 2000 relating to the offer of securities to the public and admission of securities to trading on a regulated market (the “Prospectus Condition”) and (b) to the extent required, the Jersey Financial Services Commission having consented to the circulation in Jersey of the offer of the New KW Shares pursuant to Article 8(2) of the Control of Borrowing (Jersey) Order 1958 as amended (the “COBO Condition”).

If the Prospectus Condition and, to the extent required, the COBO Condition is not satisfied within the period permitted by the Panel, only the consideration available under the Original Offer will be available to KWE Shareholders.

Timing update

The Scheme Document will contain further information about the Merger and the Scheme and notices of the Scheme Court Meeting and KWE General Meeting, and will specify the action to be taken by KWE Scheme Shareholders. It is expected that the Scheme Document will now be despatched to KWE Shareholders, together with the Forms of Proxy, on or before 16 October 2017.

It is expected that the US Proxy Statement, containing details of the Merger and notice of the KW Special Meeting, will be posted to KW Shareholders at or around the same time as the Scheme Document is posted to KWE Shareholders, with the KW Special Meeting being held at or around the same time as the KWE Meetings.

It is expected that the Prospectus, containing details of the New KW Shares, will be published at or around the same time as the Scheme Document is posted to KWE Shareholders.

KW and KWE now expect that the Scheme will become effective in the fourth quarter of 2017.

Financing

The aggregate value of the KW Cash Component of approximately £288 million payable by KW under the New Offer will be funded from cash resources of KW.

In accordance with Rule 2.7(d) of the Code, Goldman Sachs, as lead financial adviser to KW, is satisfied that sufficient resources are available to KW to satisfy in full the cash consideration payable by KW pursuant to the New Offer.

Documents published on a website

Copies of the following documents will, by no later than 12 noon (London time) on 14 June 2017, be published on KW’s website at ir.kennedywilson.com and KWE’s website at www.kennedywilson.eu until the completion of the Merger:

• this announcement;

• the Additional Irrevocable Undertakings; and

• the Letter of Intent.

Appendix 1 to this announcement contains the sources of information and bases of calculations of certain information contained in this announcement. This announcement should be read in conjunction with the full text of the Rule 2.7 Announcement (including the appendices set out therein). Appendix 2 to this announcement contains details of the Additional Irrevocable Undertakings and the Letter of Intent. Each of the Original Offer and the New Offer is subject to, among other things, the satisfaction or waiver of the Conditions set out in Part A of Appendix 1 to the Rule 2.7 Announcement and, as regards the New Offer, the Prospectus Condition and, to the extent required, the COBO Condition. Each of the Original Offer and the New Offer is also subject to the further terms and conditions set out in Part B of Appendix 1 to the Rule 2.7 Announcement and the further terms to be set out in the Scheme Document.

Enquiries

Kennedy-Wilson Holdings, Inc.

Matt Windisch +1 310 887 6400

Goldman Sachs (lead financial adviser to KW)

Mark Sorrell	+44 (0) 20 7774 1000
Chris Emmerson	+44 (0) 20 7774 1000
David Friedland	+1 212 902 0300
Keith Wetzel	+1 310 407 5700

BofA Merrill Lynch (financial adviser to KW)

Geoff Iles	+44 (0) 20 7628 1000
Kieran Millar	+44 (0) 20 7628 1000
Jeff Horowitz	+1 646 855 3213
Cavan Yang	+1 646 855 4157

Deutsche Bank (financial adviser to KW)

Drew Goldman	+1 212 250 2500
Rishi Bhuchar	+44 (0) 20 7545 8000
Brian Mendell	+1 212 250 2500
Nancy Davey	+1 212 250 2500

Joele Frank, Wilkinson Brimmer Katcher (public relations adviser to KW)

Meaghan Repko	+1 212 355 4449
Matt Gross	+1 212 355 4449

Kennedy Wilson Europe Real Estate plc

Charlotte Valeur +44 (0) 1534 835 722

Rothschild (lead financial adviser to the Independent Committee of KWE)

Alex Midgen	+44 (0) 20 7280 5000
Sam Green	+44 (0) 20 7280 5000

J.P. Morgan Cazenove (financial adviser to the Independent Committee of KWE)

Dwayne Lysaght	+44 (0) 20 7742 6000
Bronson Albery	+44 (0) 20 7742 6000
Kirshlen Moodley	+44 (0) 20 7742 6000
Tara Morrison	+44 (0) 20 7742 6000

FTI Consulting (public relations adviser to KWE)

Dido Laurimore	+44 (0) 203 727 1000
Richard Sunderland	+44 (0) 203 727 1000

Further information

This announcement is for information purposes only and is not intended to and does not constitute, or form part of, an offer, invitation or the solicitation of an offer or invitation to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of any securities, or the solicitation of any vote or approval in any jurisdiction, pursuant to the Merger or otherwise, nor shall there be any sale, issuance or transfer of securities of KW or KWE in any jurisdiction in contravention of applicable law. The Merger will be implemented solely by means of the Scheme Document and the accompanying Forms of Proxy (or, in the event that the Merger is to be implemented by means of a Takeover Offer, the Takeover Offer document), which will contain the full terms and conditions of the Merger, including details of how to vote in respect of the Merger.

KW will prepare the US Proxy Statement to be distributed to KW Shareholders, containing details of the Merger, notice of the KW Special Meeting and information on the New KW Shares. KW will also publish the Prospectus, containing details of the New KW Shares. KW urges KWE Shareholders to read the Scheme Document and the Prospectus carefully when they become available, because they will contain important information in relation to the Merger and the New KW Shares. KW urges KW Shareholders to read the US Proxy Statement carefully when it becomes available.

Any vote in respect of resolutions to be proposed at the KWE Meetings or the KW Special Meeting to approve the Merger, the Scheme or related matters should be made only on the basis of the information contained in the Scheme Document, the Prospectus and, in the case of KW Shareholders, the US Proxy Statement.

This announcement does not constitute a prospectus or prospectus equivalent document.

Goldman Sachs International, which is authorised by the Prudential Regulation Authority and regulated by the FCA and the Prudential Regulation Authority in the UK, and Goldman Sachs & Co. LLC (in their capacity as financial advisors to KW) (together, “Goldman Sachs”) are acting exclusively for KW and no one else in connection with the Merger or any other matter referred to in this announcement and will not be responsible to anyone other than KW for providing the protections afforded to clients of Goldman Sachs, or for providing advice in relation to the Merger or any other matters referred to in this announcement.

Merrill Lynch International, which is authorised by the Prudential Regulation Authority and regulated by the FCA and the Prudential Regulation Authority in the UK, and Merrill Lynch, Pierce, Fenner & Smith Incorporated (together with Merrill Lynch International, “BofA Merrill Lynch”) are acting exclusively for KW and no one else in connection with the Merger or any other matter referred to in this announcement and will not be responsible to anyone other than KW for providing the protections afforded to clients of BofA Merrill Lynch, or for providing advice in relation to the Merger or any other matters referred to in this announcement.

Deutsche Bank AG is authorised under German Banking Law (competent authority: European Central Bank) and, in the UK, by the Prudential Regulation Authority. It is subject to supervision by the European Central Bank and by BaFin, Germany’s Federal Financial Supervisory Authority, and is subject to limited regulation in the UK by the Prudential Regulation Authority and Financial Conduct Authority. Details about the extent of its authorisation and regulation by the Prudential Regulation Authority, and regulation by the Financial Conduct Authority, are available on request or from www.db.com/en/content/eu_disclosures.htm.

Deutsche Bank AG, acting through its London branch (“DB London”), and Deutsche Bank Securities Inc. (“DBSI” and, together with DB London, “DB”) are acting as financial advisers to KW and no other person in connection with this announcement and its contents. DB will not be responsible to any person other than KW for providing any of the protections afforded to clients of DB, nor for providing any advice, in relation to any matter referred to herein. Without limiting a person’s liability for fraud, neither DB nor any of their affiliates nor any of their or their affiliates’ respective directors, officers, representatives, employees, advisers or agents shall have any liability to any other person in connection with this announcement and its contents.

Rothschild, which is authorised and regulated by the FCA in the UK, is acting exclusively for the Independent Committee of KWE and no one else in connection with the Merger and any other matter referred to in this announcement and will not be responsible to anyone other than the Independent Committee of KWE for providing the protections afforded to clients of Rothschild, or for providing advice in relation to the Merger or any other matters referred to in this announcement.

J.P. Morgan Limited (which conducts its UK investment banking business as J.P. Morgan Cazenove (“J.P. Morgan Cazenove”)), which is authorised and regulated in the UK by the FCA, is acting exclusively for the Independent Committee of KWE and no one else in connection with the Merger or any other matter referred to in this announcement and will not be responsible to anyone other than the Independent Committee of KWE for providing the protections afforded to clients of J.P. Morgan Cazenove, or for providing advice in relation to the Merger or any other matters referred to in this announcement.

Overseas jurisdictions

The release, publication or distribution of this announcement in or into jurisdictions other than the UK, Jersey or the United States may be restricted by law and therefore any persons who are subject to the law of any jurisdiction other than the UK, Jersey or the United States should inform themselves about, and observe, any applicable legal or regulatory requirements. In particular the ability of persons who are not resident in the UK, Jersey or the United States to vote their KWE Shares with respect to the Scheme at the Scheme Court Meeting, or to appoint another person as proxy to vote at the Scheme Court Meeting on their behalf, may be affected by the laws of the relevant jurisdictions in which they are located. Any failure to comply with the applicable restrictions may constitute a violation of the securities laws of any such jurisdiction. To the fullest extent permitted by applicable law, the companies and persons involved in the Merger disclaim any responsibility or liability for the violation of such restrictions by any person. This announcement has been prepared for the purpose of complying with Jersey law and the Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside of England and Wales and Jersey. Unless otherwise determined by KW or required by the Code, and permitted by applicable law and regulation, the Merger will not be made available directly or indirectly in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction and no person may vote in favour of the Merger by use of mail or any other means or instrumentality (including, without limitation, facsimile, email or other electronic transmission, telex or telephone) of interstate or foreign commerce of, or any facility of a national, state or other securities exchange of, any Restricted Jurisdiction.

Copies of this announcement and any formal documentation relating to the Merger will not be and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in, into or from any Restricted Jurisdiction or any jurisdiction where to do so would violate the laws of that jurisdiction and persons receiving such documents (including custodians, nominees and trustees) must not mail or otherwise forward, distribute or send them in, into or from any Restricted Jurisdiction. Doing so may render invalid any related purported vote in respect of the Merger. If the Merger is implemented by way of a Takeover Offer (unless otherwise permitted by applicable law or regulation), the Offer may not be made, directly or indirectly, in or into or by use of mail or any other means or instrumentality (including, without limitation, facsimile, email or other electronic transmission, telex or telephone) of interstate or foreign commerce of, or any facility of a national, state or other securities exchange of, any Restricted Jurisdiction and the Offer will not be capable of acceptance by any such use, means, instrumentality or facilities or from within any Restricted Jurisdiction.

The availability of New KW Shares pursuant to the Merger to KWE Shareholders who are not resident in the UK, Jersey or the United States or the ability of those persons to hold such shares may be affected by the laws or regulatory requirements of the relevant jurisdictions in which they are resident. Persons who are not resident in the UK, Jersey or the United States should inform themselves of, and observe, any applicable legal or regulatory requirements.

Further details in relation to Overseas Shareholders will be contained in the Scheme Document and the Prospectus.

Rounding

Certain figures included in this announcement have been subjected to rounding adjustments. Accordingly, figures shown for the same category presented in different tables may vary slightly and figures shown as totals in certain tables may not be an arithmetic aggregation of the figures that precede them.

No profit forecast

Unless expressly stated otherwise, no statement in this announcement is intended as a profit forecast or profit estimate for any period.

Additional information and where to find it

The Merger relates to the shares of a Jersey company and is being made by means of a scheme of arrangement provided for under Jersey law. A transaction effected by means of a scheme of arrangement is not subject to the tender offer rules under the US Exchange Act and is exempt from the registration requirements under the US Securities Act. Accordingly, the Merger will be subject to disclosure requirements and practices applicable in the UK and Jersey to schemes of arrangement, which are different from the disclosure and other requirements of the US tender offer and securities laws.

It may be difficult for US holders of KWE Shares to enforce their rights and any claims they may have arising under US federal securities laws in connection with the Merger, since KWE is organised under the laws of a country other than the US, and some or all of its officers and directors may be residents of countries other than the US and most of the assets of KWE are located outside of the US. US holders of KWE Shares may not be able to sue a non-US company or its officers or directors in a non-US court for violations of US securities laws. Further, it may be difficult to compel a non-US company and its affiliates to subject themselves to a US court’s jurisdiction or judgment.

The Merger may, in the circumstances provided for in the Rule 2.7 Announcement, instead be carried out by way of a Takeover Offer under Jersey law. If KW exercises its right to implement the Merger by way of a Takeover Offer, such Offer will be made in compliance with applicable US tender offer and securities laws and regulations, including the exemptions therefrom.

In accordance with normal UK practice, KW or its nominees, or its brokers (acting as agents), may from time to time make certain purchases of, or arrangements to purchase, KWE Shares outside of the US, other than pursuant to the Merger, until the date on which the Merger becomes effective, lapses or is otherwise withdrawn. These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices. Any information about such purchases will be disclosed, as required in the UK, will be reported to a Regulatory Information Service and will be available on the London Stock Exchange website at www.londonstockexchange.com.

This announcement may be deemed to be solicitation material in respect of the proposed acquisition of KWE by KW, including the issuance of the New KW Shares in respect of the Merger. In connection with the foregoing proposed issuance of New KW Shares, KW expects to file a proxy statement on Schedule 14A with the SEC. To the extent KW effects the acquisition of KWE as a scheme of arrangement under Jersey law, the issuance of the New KW Shares in the Merger would not be expected to require registration under the US Securities Act, pursuant to an exemption provided by Section 3(a)(10) of the US Securities Act. In the event that KW determines to effect the Merger pursuant to an Offer or otherwise in a manner that is not exempt from the registration requirements of

the US Securities Act, it will file a registration statement with the SEC containing a prospectus with respect to the New KW Shares that would be issued in the Merger. INVESTORS AND SECURITY HOLDERS OF KW ARE URGED TO READ THESE MATERIALS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE MERGER THAT KW WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT KW, THE PROPOSED ISSUANCE OF THE NEW KW SHARES AND THE MERGER. The preliminary proxy statement, the definitive proxy statement, in each case as applicable, and other relevant materials in connection with the proposed issuance of the New KW Shares and the Merger (when they become available), and, if required, the registration statement/prospectus and other documents filed by KW with the SEC, may be obtained free of charge at the SEC’s website at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents filed with the SEC at KW’s website, ir.kennedywilson.com, or by contacting KW’s Investor Relations department in writing at 151 S. El Camino Drive, Beverly Hills, CA 90212, United States of America.

KW believes that KW, KWE, their respective directors and certain KW executive officers may be deemed to be participants in the solicitation of proxies from KW Shareholders with respect to the Merger, including the proposed issuance of New KW Shares. Information about KW’s directors and executive officers and their ownership of KW Shares and KWE Shares or securities referencing KWE Shares is set out in KW’s Annual Report on Form 10-K for the fiscal year ended 31 December 2016, which was filed with the SEC on 27 February 2017, KW’s proxy statement for its 2017 Annual Meeting of Stockholders, which was filed with the SEC on 28 April 2017, and KWE’s Annual Report for the year ended 31 December 2016, which was filed with the SEC by KW on Form 8-K on 23 March 2017. Information about the directors of KWE is set out in KWE’s Annual Report for the year ended 31 December 2016, which was filed with the SEC by KW on Form 8-K on 23 March 2017. Information regarding the identity of the potential participants, and their direct or indirect interests in the solicitation, by security holdings or otherwise, will be set out in the proxy statement and other materials to be filed with the SEC in connection with the Merger and issuance of New KW Shares.

For the avoidance of doubt, neither the Independent Committee of KWE nor Rothschild nor J.P. Morgan Cazenove express any view as to the advantages or disadvantages of the Merger as far as KW Shareholders are concerned.

Forward-looking statements

This announcement, oral statements made regarding the Merger, and other information published by KW and KWE contain statements which are, or may be deemed to be, “forward-looking statements” with respect to the financial condition, results of operations and businesses of KWE and KW and the KWE Group and the KW Group, and certain plans and objectives of KWE and KW with respect to the Combined Group. All statements other than statements of historical fact are forward-looking statements. Forward-looking statements are prospective in nature and are not based on historical facts, but rather on current expectations and projections of the management of KW and KWE about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. The forward-looking statements contained in this announcement include statements relating to the expected effects of the Merger on KW and KWE, the expected timing and scope of the Merger and other statements other than historical facts. Often, but not always, forward-looking statements can be identified by the use of forward-looking words such as “plans”, “expects”, “does not expect”, “is expected”, “is subject to”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, “does not anticipate”, “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “should”, “would”, “might” or “will” be taken, occur or be achieved. Although KW and KWE believe that the expectations reflected in such forward-looking statements are reasonable, KW and KWE can give no assurance that such expectations will prove to be correct. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements. These factors include the satisfaction of the Conditions, as well as additional factors, such as: risks relating to the KW Group’s and the KWE Group’s credit rating; local and global political and economic conditions, including Brexit; the KW Group’s and the KWE Group’s economic model and liquidity risks; financial services risk; the risks associated with

KW’s and KWE’s brand, reputation and trust; environmental risks; safety, technology, data security and data privacy risks; the ability to realise the anticipated benefits and synergies of the Merger, including as a result of a delay in completing the Merger or difficulty in integrating the businesses of the companies involved; legal or regulatory developments and changes; the outcome of any litigation; the impact of any acquisitions or similar transactions; competition and market risks; the impact of foreign exchange rates; pricing pressures; and business continuity and crisis management. Other unknown or unpredictable factors could cause actual results to differ materially from those in the forward-looking statements. Such forward-looking statements should therefore be construed in the light of such factors. Neither KW nor KWE, nor any of their respective associates, directors, officers or advisers, provides any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forward-looking statements in this announcement will actually occur. You are cautioned not to place undue reliance on these forward-looking statements. Each forward-looking statement speaks only as of the date of this announcement. None of KWE, the KWE Group, KW or the KW Group undertakes any obligation publicly to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Publication on website and availability of hard copies

A copy of this announcement will be made available, subject to certain restrictions relating to persons resident in Restricted Jurisdictions, on KW’s website at ir.kennedywilson.com and KWE’s website at www.kennedywilson.eu by no later than 12 noon (London time) on 14 June 2017. For the avoidance of doubt, the contents of that website are not incorporated into and do not form part of this announcement.

KW Shareholders may request a hard copy of this announcement, and any future documents, announcements and information, by contacting Goldman Sachs International during business hours on +44 (0) 20 7774 1000 or by submitting a request in writing to Chris Emmerson at Goldman Sachs International, Peterborough Court, 133 Fleet Street, London EC4A 2BB, United Kingdom.

KWE Shareholders may request a hard copy of this announcement, and any future documents, announcements and information, by contacting the Corporate Services team at Crestbridge during business hours on +44 (0) 1534 835600 or by submitting a request in writing to the Corporate Services Team, Crestbridge, 47 Esplanade, St Helier, Jersey JE1 0BD.

If you have received this announcement in electronic form, copies of this announcement and any document or information incorporated by reference into this document will not be provided unless such a request is made.

If you are in any doubt about the contents of this announcement or the action you should take, you are recommended to seek your own independent financial advice immediately from your stockbroker, bank manager, solicitor, accountant or independent financial adviser duly authorised under the Financial Services and Markets Act 2000 (as amended) if you are resident in the UK or, if not, from another appropriately authorised independent financial adviser.

APPENDIX 1

SOURCES OF INFORMATION AND BASES OF CALCULATION

1 Unless otherwise stated, all figures and percentages in this announcement have been calculated on the assumption that all KWE Scheme Shareholders elect to receive the consideration available under the New Offer.

2 The implied value of the Original Offer is calculated:

2.1 by reference to the Closing Price of US$19.55 per KW Share on the Latest Practicable Date;

2.2 on the basis of an exchange rate of 1.2656 US Dollars per Pound Sterling, taken from Bloomberg as at 5:00 p.m. on the Latest Practicable Date;

2.3 on the basis of the exchange ratio of 0.6670 New KW Shares in exchange for each KWE Scheme Share held; and

2.4 on the basis of the existing number of KWE Shares in issue referred to in paragraph 4 below.

3 The implied value of the New Offer is calculated:

3.1 by reference to the Closing Price of US$19.55 per KW Share on the Latest Practicable Date;

3.2 on the basis of an exchange rate of 1.2656 US Dollars per Pound Sterling, taken from Bloomberg as at 5:00 p.m. on the Latest Practicable Date;

3.3 on the basis of the exchange ratio of 0.3854 New KW Shares in exchange for each KWE Scheme Share held; and

3.4 on the basis of the existing number of KWE Shares in issue referred to in paragraph 4 below.

4 As at the Latest Practicable Date, KWE had 126,133,407 KWE Shares in issue and KW had 114,237,750 KW Shares in issue.

5 As at the Latest Practicable Date, KW and its subsidiaries held 30,015,924 KWE Shares.

6 As at the Latest Practicable Date, KWE had no dilutive options or awards outstanding over KWE Shares. KW has granted RSUs to certain KW Directors and certain of its employees, which convert into KWE Shares on a one-for-one basis on vesting. As at the Latest Practicable Date, there were 533,549 unvested RSUs.

7 The share capital of the Combined Group (being 151,281,428 KW Shares) has been calculated as the sum of:

7.1 a total number of 114,237,750 KW Shares in issue as referred to in paragraph 4 above; and

7.2 37,043,678 KW Shares which would be issued pursuant to the terms of the New Offer (being the number of KWE Shares as referred to in paragraph 4 above, less the number of KWE Shares held by KW and its subsidiaries as referred to in paragraph 5 above, multiplied by the exchange ratio of 0.3854 as referred to in paragraph 3.3 above).

8 The percentage of the share capital of the Combined Group that will be owned by KWE Shareholders following the Merger (being approximately 24%) is calculated by dividing the number of KW Shares to be issued pursuant to the New Offer referred to in paragraph 7.2 above by the issued share capital of the Combined Group (as set out in paragraph 7 above) and multiplying the resulting sum by 100 to produce a percentage.

9 Unless otherwise stated, all prices quoted for KWE Shares have been derived from the Daily Official List and represent closing middle market prices on the relevant date.

10 Unless otherwise stated, all prices quoted for KW Shares have been derived from the NYSE and represent closing middle market prices on the relevant date.

11 For the purposes of the financial comparisons contained in this Announcement, no account has been taken of any liability to taxation or the treatment of fractions under the Merger.

12 Certain figures included in this Announcement have been subject to rounding adjustments.

APPENDIX 2

ADDITIONAL IRREVOCABLE UNDERTAKINGS AND LETTER OF INTENT

Additional Irrevocable Undertakings

The following KWE Shareholders have given irrevocable undertakings to vote in favour of the Scheme at the Scheme Court Meeting and the resolutions to be proposed at the KWE General Meeting in relation to the following KWE Shares currently held by them, as well as any further KWE Shares they may acquire:

Name	Number of KWE Shares		Percentage of issued ordinary share capital of KWE (%)
Quantum Strategic Partners Ltd.		15,981,750	12.7
Franklin Templeton Institutional, LLC		11,534,900	9.1
Total		27,516,650	21.8

The obligations of Quantum Strategic Partners Ltd. under its irrevocable undertaking will lapse and cease to have effect if:

• this announcement is not released by midday Eastern Time on 13 June 2017, or such later time and/or date as KW and KWE may agree;

• the Scheme Document has not been posted within the period permitted by the Panel;

• at any time before the date of the Scheme Court Meeting, a third party announces its intention to make an offer for KWE or substantially all of its business and assets which, in Quantum Strategic Partners Ltd.’s reasonable opinion, represents an improvement on the New Offer;

• KW’s offer to implement the Merger by means of a Scheme lapses or is withdrawn (provided that KW has not announced, within 10 business days of the Scheme having so lapsed or been withdrawn, that it intends to implement the Merger by way of a Takeover Offer); or

• the Scheme has not become effective by the earlier of (i) midday Eastern Time on 31 October 2017 and (ii) any date specified in the Scheme Document as being the latest date by which the Scheme must have become effective.

Pursuant to the irrevocable undertaking, Quantum Strategic Partners Ltd. has also agreed to refrain from certain actions, including (a) disposing of any KWE Shares currently held by it or any further KWE Shares it may acquire (subject to certain exceptions), (b) acquiring any KWE Shares, (c) selling any KWE Shares short or entering into any short derivative position referenced to them or (d) soliciting, directly or indirectly, or initiating discussions with a third party in connection with a competing offer for KWE.

The obligations of Franklin Templeton Institutional, LLC under its irrevocable undertaking will lapse and cease to have effect if:

• this announcement is not released by 5.00 pm on 13 June 2017, or such later time and/or date as KW and KWE may agree;

• the Scheme Document has not been posted within the period permitted by the Panel;

• at any time before the date of the Scheme Court Meeting, a third party announces its intention to make an offer for KWE which is governed by the Code which, in Franklin Templeton Institutional, LLC’s reasonable opinion, represents an improvement on the New Offer; or

• KW’s offer to implement the Merger by means of a Scheme lapses or is withdrawn (provided that KW has not announced that it intends to implement the Merger by way of a Takeover Offer).

Pursuant to the irrevocable undertaking, Franklin Templeton Institutional, LLC has also agreed to refrain from certain actions, including (a) disposing of any KWE Shares currently held by it or any further KWE Shares it may acquire, (b) acquiring any KWE Shares, (c) selling any KWE Shares short or entering into any short derivative position referenced to them or (d) soliciting, directly or indirectly, or initiating discussions with a third party in connection with a competing offer for KWE. However, Franklin Templeton Institutional, LLC will be permitted to sell KWE Shares if it is instructed to do so by clients on whose account it holds those KWE Shares.

Letter of Intent

The Värde Fund X (Master), L.P., The Värde Fund XI, (Master) L.P., The Värde Fund VI-A, L.P., Värde Investment Partners, L.P., Värde Investment Partners (Offshore) Master, L.P., Värde Credit Partners Master, L.P. and The Värde Skyway Master Fund, L.P. (together, the “Värde Shareholders”), all of which are ultimately controlled by Värde Partners, Inc., have confirmed their intention to vote in favour of the Scheme at the Scheme Court Meeting and the resolutions relating to the Merger at the KWE General Meeting (or, in the event that the Merger is implemented by way of a Takeover Offer, accept the Offer) in respect of their entire holdings, representing, in aggregate, approximately 5.6% of KWE’s existing ordinary share capital as at the Latest Practicable Date. The Letter of Intent is non-binding and does not prevent the Värde Shareholders from modifying or withdrawing their support for the Merger in the event that a higher offer to acquire KWE is made or from transferring or disposing of their interests in the KWE Shares to which the Letter of Intent relates. The Letter of Intent will lapse if this announcement is not released by 12 noon on 13 June 2017.

EX-99.1

Exhibit 99.1

DEED OF IRREVOCABLE UNDERTAKING

Private and confidential

From: Quantum Strategic Partners Ltd

c/o Soros Fund Management LLC

250 West 55th Street

New York, NY 10019

To: Kennedy-Wilson Holdings, Inc.

151 S. El Camino Drive

Beverly Hills

CA 90212

United States of America

Date: 13 June 2017

Irrevocable undertaking – proposed acquisition of Kennedy Wilson Europe Real Estate plc

1 Interpretation

1.1 In this undertaking:

“Acceptance Deadline” has the meaning given to it in clause 9.2.1;

“Announcement” means an announcement setting out the terms of, and the price offered under, the Transaction in substantially the form set out in the draft announcement attached at schedule 2, which in any event contains (i) no change or limitation in the value of the consideration payable as compared to the amount and form of consideration referred to in such draft, and (ii) no change to the terms and conditions which is material and is less favourable to Target Shareholders than the terms contained in such draft;

“Bidder” means Kennedy-Wilson Holdings, Inc. and any reference to the Bidder shall include any group company of the Bidder which is identified in the Announcement, the Scheme Document or the Offer Document (as applicable) as the person which will implement the Transaction;

“Bidder Financial Adviser” means Goldman Sachs International, as financial adviser to the Bidder in connection with the Transaction;

“Bidder Group” means the Bidder and its subsidiary undertakings from time to time;

“Bidder Shares” means shares of common stock of US$0.0001 each in the capital of the Bidder;

“Code” means the City Code on Takeovers and Mergers;

“Committed Shares” has the meaning given to it in clause 3.2;

“Court” means the Royal Court of Jersey;

“Court Meeting” has the meaning given to it in clause 3.1.1;

“FCA” means the UK Financial Conduct Authority (or any successor regulatory organisation);

1

“General Meeting” has the meaning given to it in clause 3.1.2;

“Jersey Companies Law” means the Companies (Jersey) Law 1991 (as amended from time to time);

“LSE” means the London Stock Exchange plc;

“MAR” means EU regulation No 596/2014 and any delegated legislation made pursuant thereto and as interpreted by any guidance issued by the European Securities and Markets Authority;

“Offer” means a takeover offer (as defined in Article 116 of the Jersey Companies Law) to implement the Transaction made by the Bidder in respect of the Target Shares;

“Offer Document” means the document containing the formal Offer;

“Panel” means the Panel on Takeovers and Mergers;

“Proxy Deadline” has the meaning given to it in clause 3.1;

“Scheme” means the proposed scheme of arrangement under Article 125 of the Jersey Companies Law between the Target and its shareholders to implement the Transaction, with or subject to any modification, addition or condition approved or imposed by the Court and agreed by the Target and Bidder;

“Scheme Document” means the document to be sent to, among others, the Target Shareholders containing and setting out, among other things, the full terms and conditions of the Scheme and containing the notices convening the Court Meeting and the General Meeting;

“Target” means Kennedy Wilson Europe Real Estate plc;

“Target Group” means the Target and its subsidiary undertakings from time to time;

“Target Shares” means ordinary shares of nil par value in the capital of the Target;

“Target Shareholders” means holders of Target Shares;

“Third Party Proposal” means (a) any offer, scheme of arrangement, share issue or other transaction which would involve any person or group of persons acting in concert (other than the Bidder and persons acting in concert with it) acquiring control (as defined in the Code) of the Target; (b) any arrangement or transaction for the transfer of any interest in all or substantially all of the business and assets of the Target Group or in any part thereof which is material in the context of the Target Group, taken as a whole; or (c) any other transaction which under Rule 21.1 of the Code would require approval by shareholders of the Target and to which the Bidder has not given its prior written consent; and

“Transaction” shall:

(A) mean the proposed acquisition by the Bidder of the entire issued and to be issued share capital of the Target (other than shares already held by the Bidder and its associates, if any), which is currently proposed to be effected by means of the Scheme upon the terms of and subject to the conditions set out and referred to in the Announcement, together with such additional terms and conditions as may be required to comply with the requirements of the Code, the Panel, the Jersey Financial Services Commission, the Court, the LSE, the FCA and/or as are customarily included in offers made under the Code and/or as are agreed between the Target and the Bidder; and

(B) include any revision or variation of or to the terms of the proposed acquisition as referred to in paragraph (A) above which represents, in the reasonable opinion of N M Rothschild & Sons Limited and J.P. Morgan Limited (in their capacity as financial advisers to the independent directors of the Target), no diminution in the value of the Scheme;

1.2 In this undertaking any reference to:

1.2.1 “include(s)” and “including” shall be construed as if followed by the words “without limitation”;

1.2.2 a “subsidiary undertaking” or “parent undertaking” has the meaning given by s.1162 Companies Act 2006;

1.2.3 “group company” means, in relation to any body corporate, a parent undertaking or subsidiary undertaking of that body or another subsidiary undertaking of the same parent undertaking;

1.2.4 the Scheme “lapsing” means the Bidder ceasing to be obliged under the Code to implement the Scheme, or the Panel consenting to the Bidder not doing so, unless, in either case, as a result of the Bidder exercising its right to implement the Transaction by way of an Offer rather than by way of the Scheme;

1.2.5 “interests in securities”, “relevant securities” and “acting in concert” have the meanings set out in the corresponding definitions in the Code;

1.2.6 a “business day” means any day other than a Saturday, Sunday or any other day which is a public holiday in England;

1.2.7 time is to the time in London (unless specifically stated otherwise);

1.2.8 a clause or schedule is to a clause of or schedule to this undertaking; and

1.2.9 any provision of the Code or to any legislation includes a reference to the same as from time to time amended, modified, consolidated or re-enacted and in force.

2 Undertaking

We are entering into this undertaking in consideration of the Bidder permitting the release of the Announcement.

3 Approval of the Scheme

3.1 We undertake and agree that, unless and until our obligations under this undertaking terminate pursuant to clause 8, we shall exercise the voting rights in respect of the Committed Shares:

3.1.1 in favour of any resolution (whether or not amended and whether put on a show of hands or a poll) to approve the Scheme proposed at any meeting convened by order of the Court, including any adjournment thereof (a “Court Meeting”); and

3.1.2 in favour of any resolution(s) (whether or not amended and whether put on a show of hands or a poll) proposed at any general or class meeting of the Target convened in connection with the Scheme, including any adjournment thereof (the “General Meeting”), in order to give effect to, or satisfy any condition to, or otherwise facilitate the implementation of, the Scheme,

in each case by the valid appointment of the chairman of the relevant meeting as proxy in respect of the Committed Shares, including a direction to the proxy to vote in favour of each such resolution, duly lodged with the Target’s registrars as soon as practicable after, and in any event by no later than midday Eastern Time on the tenth business day after, the date of

deemed receipt by us of the Scheme Document (the “Proxy Deadline”) and not thereafter revoked, amended or superseded by a subsequent proxy appointment (provided that, in the case of the Committed Shares referred to in clauses 3.2.2 and 3.2.3, if any, the Proxy Deadline shall be the earlier of (i) midday Eastern Time on the fifth business day after we become directly or indirectly entitled to exercise, or direct the manner of exercise of, the voting rights attached to such Committed Shares; and (ii) the latest time allowed for lodging of proxies for use at the relevant meeting).

3.2 Subject to clause 4.2, the shares subject to this undertaking comprise:

3.2.1 the Target Shares listed in paragraphs 1 and 3 of schedule 1;

3.2.2 (without prejudice to any rights the Bidder may have in respect of any breach of clause 4 of this undertaking) any other Target Shares issued or unconditionally allotted to, or otherwise acquired by, us, and any other securities in the capital of the Target in respect of which we become the registered holder or the holder of a beneficial interest, with effect from the time we become entitled to exercise, or direct the manner of exercise of, the voting rights attached to such shares; and

3.2.3 any other shares or interests in shares attributable to or derived from any such shares,

(together the “Committed Shares”).

4 Dealings

4.1 Subject to clause 4.2, unless and until our obligations under this undertaking terminate pursuant to clause 8, we further irrevocably undertake to the Bidder:

except pursuant to the Scheme or with the prior written consent of the Bidder, not to sell, transfer or otherwise dispose of, charge, or grant any option or other right over, the Committed Shares, or any of them, or any interest therein, provided that where, as a result of the issue of Bidder Shares by way of consideration under the Transaction, we would (in the absence of any sale, transfer or other disposal) hold more than five per cent of the total issued share capital of the Bidder, the Bidder will consent to our selling, transferring or otherwise disposing of such number of Committed Shares (but not more) as is required to ensure that we hold less than five per cent of the total issued share capital of the Bidder;

4.1.1 not to acquire any interest in relevant securities of the Target (including any long derivative position), unless the Panel determines and confirms to the Bidder that, in respect of such acquisition, we are not acting in concert with the Bidder;

4.1.2 not to sell Target Shares short or enter into any short derivative position referenced to them;

4.1.3 not to enter into any agreement, undertaking, arrangement, or letter of intent, or support, whether or not conditional, or incur any obligation or permit any obligation to arise, other than with or to the Bidder:

4.1.3.1         to take any of the actions referred to in this clause 4; or

4.1.3.2        which would or might otherwise preclude us from complying with our obligations in this undertaking; and

4.1.4 that we shall not, directly or indirectly, solicit or initiate discussions with a view to any Third Party Proposal and shall notify the Bidder or the Bidder Financial Adviser in writing immediately upon receipt of any such approach.

4.2 Notwithstanding anything to the contrary contained in this undertaking, nothing herein shall restrict third party investment advisers (other than Soros Fund Management LLC) trading for, or making investments or managing capital on behalf of, us or our affiliates’ account so long as (in each case) such parties are not acting at our direction.

5 Further undertakings

5.1 Unless and until our obligations under this undertaking terminate pursuant to clause 8, we further irrevocably undertake to the Bidder that:

5.1.1 without prejudice to the specific undertakings set out in clause 3.1, we will exercise all voting and other rights attaching to the Committed Shares in such a manner as to (i) enable the conditions to the Scheme to be satisfied at the earliest practicable time; and (ii) support any resolution or action which may be necessary or desirable for the implementation of the Transaction;

5.1.2 we will not, in our capacity as a shareholder of the Target, convene, requisition, or join in convening or requisitioning, any general or class meeting of Target Shareholders, nor exercise or permit the exercise of the voting rights attaching to the Committed Shares, in any manner which would or might either frustrate the implementation of the Transaction or prevent the Scheme from being duly approved or becoming effective;

5.1.3 we will not, in our capacity as a shareholder of the Target, make any public statement or take any other action which could reasonably be expected to be prejudicial to the Scheme becoming effective at the earliest practicable time; and

5.1.4 we will not enter into any agreement or arrangement with any person, whether conditionally or unconditionally, to do any of the things prohibited by this clause 5.

6 Warranties and confirmations

We confirm, represent and warrant that:

6.1 we are the beneficial owner of the Target Shares specified in paragraphs 1 and 3 of schedule 1 and such Target Shares will be transferred pursuant to the Transaction free from all liens, charges, encumbrances, pre-emption rights and other third party rights or interests of any nature;

6.2 except as specified in schedule 1 (if applicable), we are the sole registered holder of the Committed Shares. If and to the extent that we are not the sole registered holder of any of the Committed Shares, we undertake to use our commercially reasonable endeavours to procure full compliance by the registered holder(s) with the terms of this undertaking and any provision in this undertaking whereby we agree to do or not do anything in relation to the Committed Shares includes an undertaking to use our commercially reasonable endeavours to procure that the registered holder acts accordingly;

6.3 the details of the Target Shares and other information set out in schedule 1 are true and accurate; and

6.4 we have full power and authority to enter into and perform this undertaking, which constitutes a valid and binding obligation on us in accordance with its terms. The entry into and performance by us of this undertaking will not conflict with, or result in a breach of, any law or regulation, or any ruling or decree of any court or agency, or any agreement, to which we or the Committed Shares are subject.

7 Disclosure and related matters

We acknowledge, confirm and agree that:

7.1 the information provided to us in relation to the Transaction is inside information for the purposes of the Financial Services (Jersey) Law 1998 and the Criminal Justice Act 1993 and must be kept confidential until such information has become generally available; and we will not use any such information as a basis for behaviour which would amount to market abuse under the Financial Services (Jersey) Law 1998 or MAR;

7.2 this undertaking constitutes an “irrevocable commitment” as defined by the Code and, accordingly, details of this undertaking will be disclosed publicly and this undertaking will be publicly available for inspection, in accordance with the Code;

7.3 we consent to the release of the Announcement incorporating the references in it to us and to our holding of and interests in the Committed Shares in the form and context in which they appear;

7.4 we shall promptly give you all information concerning us and any other person who is an owner or controller of any of the Committed Shares which you may reasonably require in order to comply with the requirements of all or any of the Code, the Panel, the LSE, the FCA and any applicable law or regulation; and

7.5 we shall promptly notify you in writing of any material change in any information previously provided by us or on our behalf to you or your advisers.

8 Termination of this undertaking

8.1 This undertaking will cease to be of any further force or effect and no party to this undertaking will have any claim against the other under it (without prejudice to any rights in respect of any prior breach) if:

8.1.1 the Announcement is not released by midday Eastern Time on 13 June 2017 or such later time and/or date as the Bidder and the Target may agree;

8.1.2 the Scheme Document is not posted within the period (including any extended period) permitted by the Panel;

8.1.3 the Bidder’s offer to implement the Transaction by means of the Scheme lapses or is withdrawn or otherwise becomes incapable of becoming effective (unless the Bidder announces, with the consent of the Panel and within 10 business days of the Scheme having so lapsed, been withdrawn or become incapable of becoming effective, a firm intention to switch to an Offer);

8.1.4 the Scheme has not become effective by the earlier of (i) midday Eastern Time on 31 October 2017 and (ii) any date specified in the Scheme Document as being the latest date by which the Scheme must have become effective; or

8.1.5 if, at any time before the date of the Court Meeting, a third party announces its intention to make a Third Party Proposal on terms which represent (in our reasonable opinion) an improvement on the terms offered under the Transaction as at the date on which the Third Party Proposal is announced.

8.2 We acknowledge that the decision whether or not to permit the release of the Announcement is at the Bidder’s absolute discretion and that if, after release of the Announcement, the Bidder ceases to be required by the Code to implement the Scheme, or the Panel consents to the Bidder not implementing the Scheme, then the Bidder shall not be obliged to proceed with the Scheme.

9 Offer alternative

9.1 We acknowledge that the Bidder reserves the right, subject to the consent of the Panel, to switch to an Offer as the mechanism for the Transaction, which may be subject to such conditions as to acceptance and otherwise as the Panel may permit.

9.2 If a switch from the Scheme to an Offer is announced in accordance with the Code, this undertaking shall continue to be binding, mutatis mutandis, upon terms that all references herein to the Scheme shall, where the context permits, be read as references to the Offer (or to both the Scheme and the Offer, as appropriate). Without limiting the generality of the foregoing, in the event of such a switch references in this undertaking:

9.2.1 to voting in favour of the resolutions to be proposed at the Court Meeting and the General Meeting shall be read as references to accepting the Offer, such acceptance in respect of the Committed Shares to be effected in the manner provided by the Offer Document, valid and complete in all respects, as soon as practicable after, and in any event by no later than midday Eastern Time on the 20th day after, the date of deemed receipt by us of the Offer Document (the “Acceptance Deadline”) (provided that, in the case of the Committed Shares referred to in clauses 3.2.2 and 3.2.3 (if any), the Acceptance Deadline shall be the earlier of (i) midday Eastern Time on the fifth business day after we become directly or indirectly entitled to exercise, or direct the manner of exercise of, the voting rights attached to such Committed Shares; and (ii) the latest time allowed for accepting the Offer);

9.2.2 to the date of the Court Meeting shall be read as a reference to the date on which the Offer becomes unconditional as to acceptances;

9.2.3 to the Scheme becoming effective shall be read as references to the Offer becoming unconditional in all respects;

9.2.4 to the Scheme lapsing shall be read as references to the withdrawal or lapsing of the Offer;

9.2.5 to the Scheme Document shall be read as references to the Offer Document;

9.2.6 to the period permitted by the Panel for posting the Scheme Document shall include any additional period allowed by the Panel for posting the Offer Document; and

9.2.7 to the Proxy Deadline shall be read as references to the Acceptance Deadline.

9.3 If a switch from the Scheme to an Offer is announced in accordance with the Code, we undertake and agree that we shall not withdraw any acceptance of the Offer in respect of the Committed Shares even if the terms of the Offer give accepting shareholders the right to withdraw acceptances.

9.4 In the event the mechanism for the Transaction is switched to an Offer and then switched again back to a Scheme, the original provisions of this undertaking shall have effect without regard to the modifications referred to in clause 9.2.

10 Regulatory matters

Without prejudice to any rights we may have in any other capacity, we confirm that, for the purposes of the Financial Services and Markets Act 2000 and the regulations made pursuant to that Act, we are not the customer or deemed customer of either the Bidder Financial Adviser or the Bidder and that neither of them owes us any duties or responsibilities (whether as regards best execution, suitability or otherwise) in connection with the Transaction or this undertaking as their customer or deemed customer. We acknowledge that the Bidder Financial Adviser is acting for the Bidder and no one else in connection with the Transaction and this undertaking and that the Bidder Financial Adviser

will not be responsible to us as if we were its customer nor for providing advice to us in relation to the Transaction or this undertaking. We further confirm that we have been given a realistic opportunity to consider whether or not to give this undertaking and to receive independent advice about the nature of this undertaking.

11 Time of the essence

Any time, date or period mentioned in this undertaking may be extended by mutual agreement but, as regards any time, date or period originally fixed or as extended, time shall be of the essence.

12 General

12.1 Without prejudice to any other rights or remedies that the Bidder may have, we acknowledge and agree that damages alone may not be an adequate remedy for any breach of this undertaking and accordingly that the Bidder shall be entitled to seek the remedies of injunction, specific performance or other equitable relief for any threatened or actual breach of this undertaking.

12.2 This undertaking may be executed in any number of counterparts, each of which is an original but all of which together shall constitute the same instrument.

12.3 The provisions contained in each clause of this undertaking will be enforceable independently of each of the others and their validity will not be affected if any of the others are invalid. If any provision of this undertaking is declared void but would be valid if some part of the provision were deleted, the provision in question shall apply with the modifications necessary to make it valid.

12.4 This undertaking contains the whole agreement between the parties relating to the matters contemplated by this undertaking and supersedes all previous agreements, whether oral or in writing, between the parties relating to these matters.

12.5 The Contracts (Rights of Third Parties) Act 1999 shall not apply to this undertaking and no rights or benefits expressly or impliedly conferred by this undertaking shall be enforceable under that Act against the parties to it by any other person, save that any group company of the addressee which becomes the Bidder shall be entitled to rely on this undertaking and enforce it directly.

12.6 This undertaking is governed by and shall be construed in accordance with the laws of England. Non-contractual obligations (if any) arising out of or in connection with this undertaking (including its formation) shall also be governed by the laws of England.

12.7 We submit to the exclusive jurisdiction of the courts of England and Wales as regards any claim, dispute or matter (whether contractual or non-contractual) arising out of or in connection with this undertaking (including its formation).

EXECUTED as a DEED and delivered on the date set out at the head of this undertaking.

SCHEDULE 1

Details of the Committed Shares

1 The following are all of the Target Shares held and/or beneficially owned and/or managed on a discretionary basis by us:

Number of shares	Registered holder (Note 1)	Beneficial owner
15,981,750	Morgan Stanley & Co LLC CREST Participant ID: 50708 Member Account ID: SEG	Quantum Strategic Partners Ltd.

2 Details of any other person who owns or controls the Committed Shares or any of them, within the meaning of Note 5(f) on Rule 8 of the Code, are set out below (Note 2):

(If not applicable, please so state. If applicable, please provide name, address, jurisdiction of incorporation, if applicable, and brief details of the nature of the relationship or arrangement giving ownership or control)

The Committed Shares are held for the account of Quantum Strategic Partners Ltd., a Cayman Islands exempted company. Soros Fund Management LLC serves as investment manager to Quantum Strategic Partners Ltd. and has been granted investment discretion over portfolio investments, including the Committed Shares, held for the account of Quantum Strategic Partners Ltd.

3 We have the following other interests in relevant securities of the Target (including interests in derivatives referenced thereto) (Note 3):

(If any, please provide details, including the number of shares, registered holder and beneficial owner, nature of interest, reference price, etc., as applicable. If none, please state “None”.)

None.

4 If applicable, details of any other interests in relevant securities of the Target which any person described in paragraph 2 above has:

(If none or not applicable, please so state. If applicable, please provide details)

None.

Note 1: Please indicate whether Committed Shares are certificated or held in CREST and where applicable supply details of CREST participant ID no. and member account no.

Note 2: This may include a parent company or general partner of the shareholder or the beneficial owner(s) of shares held by a shareholder giving the undertaking as trustee. When in doubt advice should be taken.

Note 3: This may include both direct interests by virtue of options, purchase contracts, or derivatives, or indirect interests in Target Shares or other relevant securities held by a subsidiary or other entity controlled by the shareholder.

EXECUTED as a DEED by	)
QUANTUM STRATEGIC	)
PARTNERS LTD, a Cayman	)	/s/ Thomas L. O’Grady
Islands exempted company, by	)	THOMAS L. O’GRADY
	)	Attorney-in-Fact
, being a person who, in	)
accordance with the laws of	)
that territory, is acting under	)
the authority of the company	)

SCHEDULE 2

Announcement

EX-99.2

Exhibit 99.2

DEED OF IRREVOCABLE UNDERTAKING

Private and confidential

From: Franklin Templeton Institutional, LLC

280 Park Avenue

New York, NY 20017

United States of America

acting in its capacity as investment manager for:

FTIF-Franklin European Small Mid Cap Growth Fund

FGT—Franklin International Small Cap Growth Fund

Newell Rubbermaid Pension Plan

JNL/Franklin Templeton International Small Cap Growth Fund

Eversource Energy Serv Co

Arizona State Retirement System

Ohio Police and Fire Pen

Canada Post Corporation Registered Pension Plan

To: Kennedy-Wilson Holdings, Inc.

151 S. El Camino Drive

Beverly Hills

CA 90212

United States of America

Date: 13 June 2017

Dear Sirs

Irrevocable undertaking – proposed acquisition of Kennedy Wilson Europe Real Estate plc

1 Interpretation

1.1 In this undertaking:

“Acceptance Deadline” has the meaning given to it in clause 9.2.1;

“Announcement” means an announcement in substantially the terms set out in the draft announcement attached at schedule 2;

“Bidder” means Kennedy-Wilson Holdings, Inc. and any reference to the Bidder shall include any group company of the Bidder which is identified in the Announcement, the Scheme Document or the Offer Document as the person which will implement the Transaction;

“Bidder Financial Adviser” means Goldman Sachs International, as financial adviser to the Bidder in connection with the Transaction;

“Bidder Group” means the Bidder and its subsidiary undertakings from time to time;

“Bidder Shares” means shares of common stock of US$0.0001 each in the capital of the Bidder;

“Code” means the City Code on Takeovers and Mergers;

1

“Committed Shares” has the meaning given to it in clause 3.2;

“Court” means the Royal Court of Jersey;

“Court Meeting” has the meaning given to it in clause 3.1.1;

“FCA” means the UK Financial Conduct Authority (or any successor regulatory organisation);

“General Meeting” has the meaning given to it in clause 3.1.2;

“Jersey Companies Law” means the Companies (Jersey) Law 1991 (as amended from time to time);

“LSE” means the London Stock Exchange plc;

“MAR” means EU regulation No 596/2014 and any delegated legislation made pursuant thereto and as interpreted by any guidance issued by the European Securities and Markets Authority;

“Offer” means a takeover offer (as defined in Article 116 of the Jersey Companies Law) made by the Bidder in respect of the Target Shares;

“Offer Document” means the document containing the formal Offer;

“Panel” means the Panel on Takeovers and Mergers;

“Proxy Deadline” has the meaning given to it in clause 3.1;

“Scheme” means the proposed scheme of arrangement under Article 125 of the Jersey Companies Law between the Target and its shareholders, with or subject to any modification, addition or condition approved or imposed by the Court and agreed by the Target and Bidder;

“Scheme Document” means the document to be sent to, among others, the Target Shareholders containing and setting out, among other things, the full terms and conditions of the Scheme and containing the notices convening the Court Meeting and the General Meeting;

“Target” means Kennedy Wilson Europe Real Estate plc;

“Target Group” means the Target and its subsidiary undertakings from time to time;

“Target Shares” means ordinary shares of nil par value in the capital of the Target;

“Target Shareholders” means holders of Target Shares;

“Third Party Proposal” means (a) any offer, scheme of arrangement, share issue or other transaction which would involve any person or group of persons acting in concert (other than the Bidder and persons acting in concert with it) acquiring control (as defined in the Code) of the Target; (b) any arrangement or transaction for the transfer of any interest in all or substantially all of the business and assets of the Target Group or in any part thereof which is material in the context of the Target Group, taken as a whole; or (c) any other transaction which under Rule 21.1 of the Code would require approval by shareholders of the Target and to which the Bidder has not given its prior written consent; and

“Transaction” shall:

(A) mean the proposed acquisition by the Bidder of the entire issued and to be issued share capital of the Target (other than shares already held by the Bidder and its associates, if any), which is currently proposed to be effected by means of the Scheme substantially upon the terms of and subject to the conditions set out and referred to in the Announcement, together with such additional terms and conditions as may be required to comply with the requirements of the Code, the Panel, the Jersey Financial Services Commission, the Court, the LSE, the FCA and/or as are customarily included in offers made under the Takeover Code and/or as are agreed between the Target and the Bidder; and

(B) include any revision or variation of or to the terms of the proposed acquisition as referred to in paragraph (A) above which represents, in the reasonable opinion of the Bidder, no diminution in the value of the Scheme.

1.2 In this undertaking any reference to:

1.2.1 “include(s)” and “including” shall be construed as if followed by the words “without limitation”;

1.2.2 a “subsidiary undertaking” or “parent undertaking” has the meaning given by s.1162 Companies Act 2006;

1.2.3 “group company” means, in relation to any body corporate, a parent undertaking or subsidiary undertaking of that body or another subsidiary undertaking of the same parent undertaking;

1.2.4 the Scheme “lapsing” means the Bidder ceasing to be obliged under the Code to implement the Scheme, or the Panel consenting to the Bidder not doing so, unless, in either case, as a result of the Bidder exercising its right to implement the Transaction by way of an Offer rather than by way of the Scheme;

1.2.5 “interests in securities”, “relevant securities” and “acting in concert” have the meanings set out in the corresponding definitions in the Code;

1.2.6 a “business day” means any day other than a Saturday, Sunday or any other day which is a public holiday in England;

1.2.7 time is to the time in London;

1.2.8 a clause or schedule is to a clause of or schedule to this undertaking; and

1.2.9 any provision of the Code or to any legislation includes a reference to the same as from time to time amended, modified, consolidated or re-enacted and in force.

2 Undertaking

We are entering into this undertaking in consideration of the Bidder permitting the release of the Announcement.

3 Approval of the Scheme

3.1 We undertake and agree that we shall exercise the voting rights in respect of the Committed Shares:

3.1.1 in favour of any resolution (whether or not amended and whether put on a show of hands or a poll) to approve the Scheme proposed at any meeting convened by order of the Court, including any adjournment thereof (a “Court Meeting”); and

3.1.2 in favour of any resolution(s) (whether or not amended and whether put on a show of hands or a poll) proposed at any general or class meeting of the Target convened in connection with the Scheme, including any adjournment thereof (the “General Meeting”), in order to give effect to, or satisfy any condition to, or otherwise facilitate the implementation of, the Scheme,

in each case by the valid appointment of the chairman of the relevant meeting as proxy in respect of the Committed Shares, including a direction to the proxy to vote in favour of each such resolution, duly lodged with the Target’s registrars as soon as practicable after, and in any event by no later than 5.00 pm on the fifth business day after, the date of despatch of the Scheme Document (the “Proxy Deadline”) and not thereafter revoked, amended or superseded by a subsequent proxy appointment (provided that, in the case of the Committed Shares referred to in clauses 3.2.2 and 3.2.3, if any, the Proxy Deadline shall be the earlier of (i) 5.00 pm on the third business day after we become directly or indirectly entitled to exercise, or direct the manner of exercise of, the voting rights attached to such Committed Shares; and (ii) the latest time allowed for lodging of proxies for use at the relevant meeting).

3.2 The shares subject to this undertaking comprise:

3.2.1 the Target Shares listed in paragraphs 1 and 3 of schedule 1;

3.2.2 (without prejudice to any rights the Bidder may have in respect of any breach of clause 4 of this undertaking) any other Target Shares issued or unconditionally allotted to, or otherwise acquired by, us, and any other securities in the capital of the Target in respect of which we become the registered holder or the holder of a beneficial interest, with effect from the time we become entitled to exercise, or direct the manner of exercise of, the voting rights attached to such shares; and

3.2.3 any other shares or interests in shares attributable to or derived from any such shares,

(together the “Committed Shares”).

4 Dealings

4.1 Subject to clause 4.2, we further irrevocably undertake to the Bidder:

4.1.1 except pursuant to the Scheme, not to sell, transfer or otherwise dispose of, charge, or grant any option or other right over, the Committed Shares, or any of them, or any interest therein and not to accept, facilitate, vote in favour of or otherwise support any Third Party Proposal in respect of all or any of the Committed Shares;

4.1.2 not to acquire any interest in relevant securities of the Target (including any long derivative position);

4.1.3 not to sell Target Shares short or enter into any short derivative position referenced to them;

4.1.4 not to enter into any agreement, undertaking, arrangement, or letter of intent, or support, whether or not conditional, or incur any obligation or permit any obligation to arise, other than with or to the Bidder:

4.1.4.1 to take any of the actions referred to in this clause 4; or

4.1.4.2 which would or might otherwise preclude us from complying with our obligations in this undertaking; and

4.1.5 that we shall not, directly or indirectly, solicit or initiate discussions with a view to any Third Party Proposal and shall notify the Bidder or the Bidder Financial Adviser in writing immediately upon receipt of any such approach.

4.2 Notwithstanding anything in clause 4.1, we may sell, transfer or otherwise dispose of Committed Shares to the extent we are directed to do so by separate accounts managed by us, in which case such Committed Shares will no longer be subject to this undertaking.

5 Further undertakings

5.1 We further irrevocably undertake to the Bidder that:

5.1.1 without prejudice to the specific undertakings set out in clause 3.1, we will exercise all voting and other rights attaching to the Committed Shares in such a manner as to (i) enable the conditions to the Scheme to be satisfied at the earliest practicable time; and (ii) support any resolution or action which may be necessary or desirable for the implementation of the Transaction;

5.1.2 without prejudice to the specific undertakings set out in clause 3.1, we will exercise all voting and other rights attaching to the Committed Shares in such a manner as to oppose any resolution or other action which (i) could reasonably be expected to prevent or delay the implementation of the Transaction; (ii) could result in any of the conditions to the Scheme not being satisfied at the earliest practicable time; or (iii) approves, facilitates or gives effect to any Third Party Proposal;

5.1.3 we will not, in our capacity as a shareholder of the Target, convene, requisition or join in requisitioning any general or class meeting of the Target to consider any resolution or other action as is described in clause 5.1.2 or the proposal of any such resolution or action at any such meeting;

5.1.4 we will not, in our capacity as a shareholder of the Target, make any public statement or take any other action which could reasonably be expected to be prejudicial to the Scheme becoming effective at the earliest practicable time; and

5.1.5 we will not enter into any agreement or arrangement with any person, whether conditionally or unconditionally, to do any of the things prohibited by this clause 5.

5.2 We irrevocably undertake to the Bidder that we shall execute (or procure the execution of) all such documents or do (or procure the doing of) all such acts and things as may be reasonably necessary or desirable to be executed or done by us in our capacity as a shareholder of the Target only for the purposes of giving effect to this undertaking.

6 Warranties and confirmations

We confirm, represent and warrant that:

6.1 we are the discretionary investment manager, with power to dispose of and direct the exercise of voting rights attached to the Target Shares specified in paragraphs 1 and 3 of schedule 1, which are (and, when transferred to the Bidder pursuant to the Scheme, will be) free from all liens, charges, encumbrances, pre-emption rights and other third party rights or interests (including any such interest which imposes any restriction on the right to exercise the voting rights attached to such shares);

6.2 except as specified in schedule 1 (if applicable), we are also the sole registered holder of the Committed Shares. If and to the extent that we are not the sole registered holder of any of the Committed Shares, we undertake to procure full compliance by the registered holder(s) with the terms of this undertaking and any provision in this undertaking whereby we agree to do or not do anything in relation to the Committed Shares includes an undertaking to procure that the registered holder acts accordingly;

6.3 the details of the Target Shares and other information set out in schedule 1 are true, accurate and complete; and

6.4 we have full power and authority to enter into and perform this undertaking, which constitutes a valid and binding obligation on us in accordance with its terms. The entry into and performance by us of this undertaking will not conflict with, or result in a breach of, any law or regulation, or any ruling or decree of any court or agency, or any agreement, to which we or the Committed Shares are subject.

7 Disclosure and related matters

We acknowledge, confirm and agree that:

7.1 the information provided to us in relation to the Transaction is inside information for the purposes of the Financial Services (Jersey) Law 1998 and the Criminal Justice Act 1993 and must be kept confidential until such information has become generally available; and we will not use any such information as a basis for behaviour which would amount to market abuse under the Financial Services (Jersey) Law 1998 or MAR;

7.2 this undertaking constitutes an “irrevocable commitment” as defined by the Code and accordingly, details of this undertaking will be disclosed publicly and this undertaking will be publicly available for inspection, in accordance with the Code;

7.3 we consent to the release of the Announcement incorporating the references in it to us in the form and context in which they appear, provided, however, that the Bidder shall provide a copy of any disclosure referencing us at least two business days prior to such disclosure and the Bidder agrees to make any modifications that we reasonably request;

7.4 we shall promptly give you all information concerning us and any other person who is an owner or controller of any of the Committed Shares which you may reasonably request in order to comply with the requirements of all or any of the Code, the Panel and any applicable law or regulation; and

7.5 we shall promptly notify you in writing of any material change in any information previously provided by us or on our behalf to you or your advisers.

8 Termination of this undertaking

8.1 This undertaking will cease to be of any further force or effect (without prejudice to any rights in respect of any prior breach) if:

8.1.1 the Announcement is not released by 5.00 pm on 13 June 2017 or such later time and/or date as the Bidder and the Target may agree; or

8.1.2 the Scheme Document is not posted within the period (including any extended period) permitted by the Panel; or

8.1.3 if, at any time before the date of the Court Meeting, a third party announces its intention to make a Third Party Proposal governed by the Code on terms which represent (in our reasonable opinion) an improvement on the terms offered under the Transaction as at the date on which the Third Party Proposal is announced; or

8.1.4 the Bidder’s offer to implement the Transaction by means of the Scheme lapses or is withdrawn (unless the Bidder announces, with the consent of the Panel, a firm intention to switch to an Offer).

8.2 We acknowledge that the decision whether or not to permit the release of the Announcement is at the Bidder’s absolute discretion and that if, after release of the Announcement, the Bidder ceases to be required by the Code to implement the Scheme, or the Panel consents to the Bidder not implementing the Scheme, then the Bidder shall not be obliged to proceed with the Scheme.

9 Offer alternative

9.1 We acknowledge that the Bidder reserves the right, subject to the consent of the Panel, to switch to an Offer as the mechanism for the Transaction, which may be subject to such conditions as to acceptance and otherwise as the Panel may permit.

9.2 If a switch from the Scheme to an Offer is announced in accordance with the Code, this undertaking shall continue to be binding, mutatis mutandis, upon terms that all references herein to the Scheme shall, where the context permits, be read as references to the Offer (or to both the Scheme and the Offer, as appropriate). Without limiting the generality of the foregoing, in the event of such a switch references in this undertaking:

9.2.1 to voting in favour of the resolutions to be proposed at the Court Meeting and the General Meeting shall be read as references to accepting the Offer, such acceptance in respect of the Committed Shares to be effected in the manner provided by the Offer Document, valid and complete in all respects, as soon as practicable after, and in any event by no later than 5.00 pm on the fifth business day after, the date of despatch of the Offer Document (the “Acceptance Deadline”) (provided that, in the case of the Committed Shares referred to in clauses 3.2.2 and 3.2.3 (if any), the Acceptance Deadline shall be the earlier of (i) 5.00 pm on the third business day after we become directly or indirectly entitled to exercise, or direct the manner of exercise of, the voting rights attached to such Committed Shares; and (ii) the latest time allowed for accepting the Offer);

9.2.2 to the Scheme becoming effective shall be read as references to the Offer becoming unconditional in all respects;

9.2.3 to the Scheme lapsing shall be read as references to the withdrawal or lapsing of the Offer;

9.2.4 to the Scheme Document shall be read as references to the Offer Document;

9.2.5 to the period permitted by the Panel for posting the Scheme Document shall include any additional period allowed by the Panel for posting the Offer Document; and

9.2.6 to the Proxy Deadline shall be read as references to the Acceptance Deadline.

9.3 If a switch from the Scheme to an Offer is announced in accordance with the Code, we undertake and agree that we shall not withdraw any acceptance of the Offer in respect of the Committed Shares even if the terms of the Offer give accepting shareholders the right to withdraw acceptances.

9.4 In the event the mechanism for the Transaction is switched to an Offer and then switched again back to a Scheme, the original provisions of this undertaking shall have effect without regard to the modifications referred to in clause 9.2.

10 Regulatory matters

Without prejudice to any rights we may have in any other capacity, we confirm that, for the purposes of the Financial Services and Markets Act 2000 and the regulations made pursuant to that Act, we are not the customer or deemed customer of either the Bidder Financial Adviser or the Bidder and that neither of them owes us any duties or responsibilities (whether as regards best execution, suitability or otherwise) in connection with the Transaction or this undertaking as their customer or deemed customer. We acknowledge that the Bidder Financial Adviser is acting for the Bidder and no one else in connection with the Transaction and this undertaking and that the Bidder Financial Adviser will not be responsible to us as if we were its customer nor for providing advice to us in relation to the Transaction or this undertaking. We further confirm that we have been given a realistic opportunity to consider whether or not to give this undertaking and to receive independent advice about the nature of this undertaking.

11 Time of the essence

Any time, date or period mentioned in this undertaking may be extended by mutual agreement but, as regards any time, date or period originally fixed or as extended, time shall be of the essence.

12 General

12.1 Without prejudice to any other rights or remedies that the Bidder may have, we acknowledge and agree that damages alone may not be an adequate remedy for any breach of this undertaking and accordingly that the Bidder shall be entitled to seek the remedies of injunction, specific performance or other equitable relief for any threatened or actual breach of this undertaking.

12.2 This undertaking may be executed in any number of counterparts, each of which is an original but all of which together shall constitute the same instrument.

12.3 The provisions contained in each clause of this undertaking will be enforceable independently of each of the others and their validity will not be affected if any of the others are invalid. If any provision of this undertaking is declared void but would be valid if some part of the provision were deleted, the provision in question shall apply with the modifications necessary to make it valid.

12.4 This undertaking contains the whole agreement between the parties relating to the matters contemplated by this undertaking and supersedes all previous agreements, whether oral or in writing, between the parties relating to these matters.

12.5 The Contracts (Rights of Third Parties) Act 1999 shall not apply to this undertaking and no rights or benefits expressly or impliedly conferred by this undertaking shall be enforceable under that Act against the parties to it by any other person, save that the Bidder Financial Adviser shall be entitled to rely on and enforce directly the provisions of clause 10 and any group company of the addressee which becomes the Bidder shall be entitled to rely on this undertaking and enforce it directly.

12.6 This undertaking is governed by and shall be construed in accordance with the laws of England. Non-contractual obligations (if any) arising out of or in connection with this undertaking (including its formation) shall also be governed by the laws of England.

12.7 We submit to the exclusive jurisdiction of the courts of England and Wales as regards any claim, dispute or matter (whether contractual or non-contractual) arising out of or in connection with this undertaking (including its formation).

EXECUTED as a DEED and delivered on the date set out at the head of this undertaking.

EXECUTED as a DEED by FRANKLIN TEMPLETON INSTITUTIONAL, LLC, a limited liability company incorporated in the United States of America, by being a person who, in accordance with the laws of that territory, is acting under the authority of the company, acting in its capacity as investment manager for FTIF-Franklin European Small Mid Cap Growth Fund, FGT Franklin International Small Cap Growth Fund, Newell Rubbermaid Pension Plan, JNL/Franklin Templeton International Small Cap Growth Fund, Eversource Energy Serv Co, Arizona State Retirement System, Ohio Police and Fire Pen and Canada Post Corporation Registered Pension Plan   /s/ Coleen Barbeau By: Coleen Barbeau Title: SVP, Director of Global Equity

SCHEDULE 1

Details of the Committed Shares

1 The following are all of the Target Shares held and/or beneficially owned and/or managed on a discretionary basis by us:

Number of shares	Registered holder (Note 1)	Beneficial owner
2,377,900	FTIF-Franklin European Small Mid Cap Growth Fund	FTIF-Franklin European Small Mid Cap Growth Fund
4,456,500	FGT—Franklin International Small Cap Growth Fund	FGT—Franklin International Small Cap Growth Fund
54,400	Newell Rubbermaid Pension Plan	Newell Rubbermaid Pension Plan
1,040,600	JNL/Franklin Templeton International Small Cap Growth Fund	JNL/Franklin Templeton International Small Cap Growth Fund
149,200	Eversource Energy Serv Co	Eversource Energy Serv Co
400,400	Arizona State Retirement System	Arizona State Retirement System
1,227,100	Ohio Police and Fire Pen	Ohio Police and Fire Pen
714,900	Canada Post Corporation Registered Pension Plan	Canada Post Corporation Registered Pension Plan

2 Details of any other person who owns or controls the Committed Shares or any of them, within the meaning of Note 5(f) on Rule 8 of the Code, are set out below (Note 2):

(If not applicable, please so state. If applicable, please provide name, address, jurisdiction of incorporation, if applicable, and brief details of the nature of the relationship or arrangement giving ownership or control)

Not applicable

3 We have the following other interests in relevant securities of the Target (including interests in derivatives referenced thereto) (Note 3):

(If any, please provide details, including the number of shares, registered holder and beneficial owner, nature of interest, reference price, etc., as applicable. If none, please state “None”.)

State Board of Administration of Florida (SBA)

1,113,900 Target Shares

4 If applicable, details of any other interests in relevant securities of the Target which any person described in paragraph 2 above has:

(If none or not applicable, please so state. If applicable, please provide details)

None

Note 1: Please indicate whether Committed Shares are certificated or held in CREST and where applicable supply details of CREST participant ID no. and member account no.

Note 2: This may include a parent company or general partner of the shareholder or the beneficial owner(s) of shares held by a shareholder giving the undertaking as trustee. When in doubt advice should be taken.

Note 3: This may include both direct interests by virtue of options, purchase contracts, or derivatives, or indirect interests in Target Shares or other relevant securities held by a subsidiary or other entity controlled by the shareholder.

SCHEDULE 2

Announcement

EX-99.3

Exhibit 99.3

Private and confidential

From: The Värde Fund X (Master), L.P.

The Värde Fund XI (Master), L.P.

The Värde Fund VI-A, L.P.

Värde Investment Partners, L.P.

Värde Investment Partners (Offshore) Master, L.P.

Värde Credit Partners Master, L.P.

The Värde Skyway Master Fund, L.P.

(together the “Shareholders”)

901 Marquette Avenue South,

Suite 3300

Minneapolis, MN 55402

To: Kennedy-Wilson Holdings, Inc.

151 S. El Camino Drive

Beverly Hills

CA 90212

United States of America

Date: 13 June 2017

Dear Sirs

Proposed acquisition of Kennedy Wilson Europe Real Estate plc (the “Target”)

1 We understand that Kennedy-Wilson Holdings, Inc. (the “Bidder”) proposes to make a revised offer pursuant to the City Code on Takeovers and Mergers (the “Code”) to acquire all of the issued and to be issued ordinary shares of nil par value in the capital of the Target, other than shares already held by it and its associates, by means of a scheme of arrangement under Article 125 of the Companies (Jersey) Law 1991 on substantially the terms set out in the draft announcement appended to this letter (the “Scheme”) (the “Announcement”).

2 As at the date of this letter we are the beneficial owners of 7,049,411 ordinary shares in the Target (the “Shares”, which term includes any further shares of the Target deriving from or attributable to those shares and any Target shares issued or unconditionally allotted to, or otherwise acquired by, us after the date hereof) registered in the name of the Shareholders.

3 We confirm that it is our current intention to exercise, or instruct a proxy or representative to exercise, all of the voting rights in respect of the Shares in favour of (i) any resolution to approve the Scheme proposed at any meeting convened by order of the Royal Court of Jersey (including any adjournment thereof) and (ii) any resolution(s) proposed at any general meeting of the Target convened in connection with the Scheme (including any adjournment thereof), in order to give effect to, or satisfy any condition to, or otherwise facilitate the implementation of, the Scheme. If we sell, transfer or otherwise dispose of any of the Shares, or cease to have full power and authority to exercise (or direct the exercise of) voting rights in respect of the Shares, or should we in any way change our intention, we shall promptly notify you and the UK Panel on Takeovers and Mergers accordingly.

4 We also confirm that, if the acquisition of the Target is revised so as to be implemented by means of a takeover offer within the meaning of Article 116 of the Companies (Jersey) Law 1991 on the terms of the Announcement instead of by means of the Scheme, it would also be our intention to accept such offer in respect of all of the Shares.

5 If the final form of the Announcement is not published by 12 noon (London time) on 13 June 2017 in substantially the same form as the Announcement, this letter shall automatically lapse and be of no further force or effect.

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6 We acknowledge that this letter constitutes a “letter of intent” as defined by the Code and that the Bidder will be required to disclose publicly details concerning this letter and the Shares in accordance with the Code and we consent to such details being included in the announcement of the Scheme, in the document containing the formal Scheme and in any other announcement or document in which such details are required to be disclosed by the Code or otherwise by applicable law or regulation. We further acknowledge that this letter will be publicly available for inspection in accordance with the requirements of the Code and agree promptly to provide to you any additional information concerning ourselves and (if applicable) any other person referred to in paragraph 7 below, which you may reasonably request for the purpose of compliance with the Bidder’s obligations under the Code.

7 For the purposes of Note 3(b) of the Notes on Rule 2.10 of the Code, we confirm that no other person is an owner or controller (within the meaning of paragraph 5(f) of the Notes on Rule 8 of the Code) of all or any of the Shares or any interest in them, save as described below:

Värde Partners, Inc. as the ultimate controlling entity of each of the Shareholders

8 Except for paragraphs 6 to 9 (inclusive), this letter creates no legally enforceable rights or obligations on any party hereto.

9 The terms of this letter shall be governed by and construed in accordance with English law.

Yours faithfully
By:	/s/ Tony Iannazzo
Name:	Anthony Iannazzo
Title:	Principal

THE VÄRDE FUND VI-A, L.P. By Värde Investment Partners G.P., LLC, Its General Partner By Värde Partners, L.P., Its Managing Member By Värde Partners, Inc., Its General Partner
THE VÄRDE FUND X (MASTER), L,P. By The Värde Fund X (GP), L.P., Its General Partner By The Värde Fund X GP, LLC, Its General Partner By Värde Partners, L.P., Its Managing Member By Värde Partners, Inc., Its General Partner	THE VÄRDE FUND XI (MASTER), L.P. By Värde Fund XI G.P., LLC, Its General Partner By Värde Partners, L.P., Its Managing Member By Värde Partners, Inc., Its General Partner
VÄRDE CREDIT PARTNERS MASTER, L.P. By Värde Credit Partners G.P., LLC, Its General Partner By Värde Partners, L.P., Its Managing Member By Värde Partners, Inc., Its General Partner	THE VÄRDE SKYWAY MASTER FUND, L.P. By The Värde Skyway Fund G.P., LLC, Its General Partner By Värde Partners, L.P., Its Managing Member By Värde Partners, Inc., Its General Partner
VÄRDE INVESTMENT PARTNERS, L.P. Värde Investment Partners G.P., LLC, Its General Partner By Värde Partners, L.P., Its Managing Member By Värde Partners, Inc., Its General Partner	VÄRDE INVESTMENT PARTNERS (OFFSHORE) MASTER, L.P. By Värde Investment Partners G.P., LLC, Its General Partner By Värde Partners, L.P., Its Managing Member By Värde Partners, Inc., Its General Partner

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APPENDIX – ANNOUNCEMENT

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