Apollo, Prospect Global Resources Enter into Exclusivity Arrangement for $100M Investment

Prospect Global Resources

announced today that it has entered into an exclusivity arrangement with an affiliate of Apollo Global Management, LLC

pursuant to which funds managed by APO ("Apollo") would purchase $100,000,000 of newly issued 10% Convertible Second Lien Notes (the "Notes"), expected to fund in the first half of 2013. Additionally, Apollo would have an option to purchase 16.7 million shares of Prospect Global common stock at an exercise price of $3.00 per share (exercisable any time through the closing of the Notes transaction), which, if exercised, would provide additional net proceeds to Prospect Global of $50,100,000.  The Company intends to use the proceeds from the Apollo financing to continue development of its proposed potash mining facility being developed in Holbrook, Arizona, by the Company's wholly-owned subsidiary, American West Potash.  Under the securities purchase agreement currently under negotiation, Apollo would purchase $100,000,000 in aggregate principal amount of Notes, with a $3.00 initial conversion price. The Notes would have an annual interest rate of 10%, of which 4% would be payable in cash and 6% payable in kind in additional Notes.  The Notes are intended