Exhibit 10.39

EIGHTH AMENDMENT TO

EMPLOYMENT AGREEMENT

This Eighth Amendment to Employment Agreement (the “Eighth Amendment’) is made and entered into as of January 3, 2000, by and between KENNEDY-WILSON, INC., a Delaware corporation, with its principal office located in Beverly Hills, California (the “Company”), and WILLIAM J. McMORROW, an individual (“Employee”).

RECITALS

WHEREAS , Company and Employee have entered into that certain Employment Agreement dated as of August 14, 1992, as amended January 1, 1993, January 1, 1994, March 31, 1995, January 1, 1996, May 19, 1997, August 20, 1998 and August 9, 1999 providing for the employment of Employee by Company pursuant to the terms of such Agreement; and

WHEREAS , Company and Employee have agreed that the terms of the Employment Agreement should be modified to change the Term, Salary and Bonus Plan.

AMENDMENT TO AGREEMENT

NOW, THEREFORE, for good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereby amend the Agreement, effective as of January 1, 2000 as follows:

1.                                        The Term of the Agreement is extended until December 31, 2002. Therefore, Section 2(a) of the Employment Agreement is amended such that the termination date of “December 31, 2000” is deleted and the termination date of “December 31, 2002” is inserted in lieu thereof

2.                                        Section 4 (i) of the Employment Agreement shall be amended such that the annual salary of “$300,000. plus an annual salary advance amount of $100,000. payable against bonus earned “ is deleted and the annual salary of “$400,000” is inserted in lieu thereof.

3.                                        Section 4(h) of the Employment Agreement is deleted in it entirety and the following is inserted in lieu thereof:

4 (ii) An annual bonus of 10% of profits.

 Bonus calculations are to be based on Company profit; pre-tax, pre-bonus paid to all other employees, pre-reserves a