Exhibit 10.3

 

SPRINGING GUARANTY

 

THIS SPRINGING GUARANTY (the “Guaranty”) dated as of July 1, 2014, executed and
delivered by KITE REALTY GROUP TRUST, a Maryland real estate investment trust
(the “Guarantor”) in favor of (a) KEYBANK NATIONAL ASSOCIATION, in its capacity
as Agent (the “Agent”) for the Lenders under that certain Fourth Amended and
Restated Credit Agreement dated as of July 1, 2014 (as amended, restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”),
by and among Kite Realty Group, L.P. (the “Borrower”), the financial
institutions party thereto and their assignees under Section 13.5. thereof
(together with the Issuing Lender and the Swingline Lender, collectively, the
“Lenders”), the Agent, and the other parties thereto, and (b) the Lenders.

 

WHEREAS, pursuant to the Credit Agreement, the Agent, the Lenders and the
Swingline Lender have agreed to make available to the Borrower certain financial
accommodations on the terms and conditions set forth in the Credit Agreement;

 

WHEREAS, the Borrower and the Guarantor, though separate legal entities, are
mutually dependent on each other in the conduct of their respective businesses
as an integrated operation and have determined it to be in their mutual best
interests to obtain financing from the Agent, the Lenders and the Swingline
Lender through their collective efforts;

 

WHEREAS, Guarantor acknowledges that it will receive direct and indirect
benefits from the Agent, the Lenders and the Swingline Lender making such
financial accommodations available to the Borrower under the Credit Agreement
and, accordingly, Guarantor is willing, upon the occurrence of a “Springing
Recourse Event” (as hereinafter defined), to guarantee the Borrower’s
obligations to the Agent, the Lenders and the Swingline Lender on the terms and
conditions contained herein; and

 

WHEREAS, Guarantor’s execution and delivery of this Guaranty is a condition to
the Agent and the Lenders making, and continuing to make, such financial
accommodations to the Borrower.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged by Guarantor, Guarantor agrees as follows:

 

Section 1.                                           Guaranty.  Guarantor, upon
the occurrence of a Springing Recourse Event, hereby absolutely, irrevocably and
unconditionally guaranties the due and punctual payment and performance when
due, whether at stated maturity, by acceleration or otherwise, of all of the
following (collectively referred to as the “Guarantied Obligations”):  (a) all
indebtedness and obligations owing by the Borrower to any Lender, the Swingline
Lender, the Issuing Lender or the Agent under or in connection with the Credit
Agreement and any other Loan Document, including without limitation, the
repayment of all principal of the Revolving Loans, Term Loans, Swingline Loans
and the Reimbursement Obligations, and the payment of all interest, Fees,
charges, attorneys’ fees and other amounts payable to any Lender or the Agent
thereunder or in connection therewith; (b) any and all extensions, renewals,
modifications, amendments or substitutions of the foregoing; (c) all expenses,
including, without limitation, reasonable attorneys’ fees and disbursements,
that are incurred by the Lenders and the Agent in the enforcement of any of the
foregoing or any obligation of Guarantor hereunder; and (d) all other
Obligations.

 

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For the purposes of this Guaranty, the occurrence of any of the events described
in (1)-(3) below shall be a “Springing Recourse Event”:

 

(1)                                 (A) Guarantor fails to perform or comply
with any of the following terms (each, a “Guarantor Covenant Breach”):

 

(i)                                     the Guarantor shall not, directly or
indirectly, enter into or conduct any business other than in connection with the
ownership, acquisition and disposition of general or limited partnership
interests in the Borrower and the management of the business of the Borrower,
and such activities as are incidental thereto, all of which shall be solely in
furtherance of the business of the Borrower;

 

(ii)                                  the Guarantor shall not own any assets
other than (A) equity interests (or rights, options or warrants in respect
thereof) of the Borrower, (B) up to a one percent (1%) equity interest in any
partnership or limited liability company at least ninety-nine percent (99%) of
the equity of which is owned, directly or indirectly, by the Borrower; (C) money
that has been distributed to Guarantor by Borrower or a Subsidiary of Borrower
described in clause (ii)(B) above in accordance with Section 10.2. of the Credit
Agreement that is held for ten (10) Business Days or less pending further
distribution to equity holders of the Guarantor, (D) assets received by the
Guarantor from third parties (including, without limitation, the proceeds from
any Equity Issuance), that are held for ten (10) Business Days or less pending
further contribution to Borrower, (E) such bank accounts or similar instruments
(subject to the other terms hereof) as it deems necessary to carry out its
responsibilities under the limited partnership agreement of the Borrower, and
(F) other tangible and intangible assets that, taken as a whole, are de minimis
in relation to the net assets of Borrower and its Subsidiaries (but which in no
event shall include any real estate, cash, cash equivalents or other liquid
assets in excess of $500,000 in the aggregate (except as permitted in clauses
(ii)(C) and (D) above) or equity interests (other than equity interests
permitted in clauses (ii)(A) and (B) above);

 

(iii)                               the Guarantor shall promptly contribute or
otherwise downstream to the Borrower any net assets received by the Guarantor
from third parties (including, without limitation, the proceeds from any Equity
Issuance), subject to the terms of clause (ii)(D) above;

 

(iv)                              the Guarantor shall not merge or consolidate
(except as permitted in the Credit Agreement), or dissolve, liquidate or
otherwise wind up its business, affairs or assets;

 

(v)                                 the Guarantor shall not guarantee, or
otherwise be or become obligated in respect of, any Indebtedness (which for the
purposes hereof shall include any obligations under any Derivatives Contract but
shall exclude (A) guarantees of obligations under any Derivatives Contracts in
favor of Associated Bank National Association and any lender under the Existing
Term Loan Agreement or Existing Credit Agreement in place as of March 31, 2014,
(B) any Indebtedness described in clause (f) of the definition of Indebtedness,
(C) any liability pursuant to a Customary Nonrecourse Debt Guaranty until a
claim is made with respect thereto (provided that for the purposes of this
clause (v), the Guarantor shall not be deemed to have violated this covenant
with respect to Indebtedness under a Customary Nonrecourse Debt Guaranty until a
judgment is obtained with respect to claims under Customary Nonrecourse Debt
Guaranties individually or in the aggregate of $30,000,000 or greater), and
(D) any liability pursuant to a springing guaranty on

 

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substantially the same terms as the Springing Guaranty; and provided further
that the Guarantor’s liability with respect to (x) Indebtedness of Borrower in
place as of March 31, 2014 and (y) Indebtedness of Inland Diversified assumed by
Borrower and that is existing debt of Inland Diversified as of July 1, 2014 and
is not incurred as a part of or in anticipation of the merger of Inland
Diversified with and into KRG Magellan, solely by virtue of the Guarantor being
the general partner of Borrower and not as a guarantor, shall be excluded from
the foregoing provided such liability is not increased; and

 

(B) with respect to a Guarantor Covenant Breach of any event described in
(1)(A)(i)-(iii) above, the passage of forty-five (45) days after the first to
occur of either (i) Borrower or Guarantor becoming aware of such Guarantor
Covenant Breach, or (ii) Agent notifying Borrower in writing of any such
Guarantor Covenant Breach, or

 

(C) with respect to a Guarantor Covenant Breach of the event described in clause
(1)(A)(v) above, the passage of ten (10) Business Days (or forty-five (45) days
if the aggregate Indebtedness for the purposes of clause (1)(A)(v) above is less
than $10,000,000), after the first to occur of either (i) Borrower or Guarantor
becoming aware of such Guarantor Covenant Breach, or (ii) Agent notifying
Borrower in writing of any such Guarantor Covenant Breach; or

 

(2)                                 Borrower or Guarantor shall commence a
voluntary case under the Bankruptcy Code of 1978, as amended, or any other
federal bankruptcy or any other domestic or foreign laws relating to bankruptcy,
insolvency, reorganization, winding-up, composition or adjustment of debts, in
each case with respect to Borrower or Guarantor, whether now or hereinafter in
effect (collectively, a “Bankruptcy Proceeding”); or

 

(3)                                 Borrower or Guarantor or any officer or
director thereof shall collude with, or otherwise assist any party in connection
with any such filing in a Bankruptcy Proceeding or solicit or cause to be
solicited petitioning creditors for any involuntary petition against Borrower or
Guarantor in any such Bankruptcy Proceeding from any party.

 

Guarantor acknowledges and agrees that the guaranty under this Guaranty of the
Guarantied Obligations shall automatically become fully effective upon the
occurrence of any Springing Recourse Event and no other documentation or notice
shall be required to evidence the same.

 

Section 2.                                           Guaranty of Payment and Not
of Collection.  This Guaranty is a guaranty of payment, and not of collection,
and upon the occurrence of a Springing Recourse Event, a debt of Guarantor for
its own account.  Accordingly, none of the Lenders, the Swingline Lender, the
Issuing Lender or the Agent shall be obligated or required before enforcing this
Guaranty against Guarantor after a Springing Recourse Event:  (a)  to pursue any
right or remedy any of them may have against the Borrower, any other Loan Party
or any other Person or commence any suit or other proceeding against the
Borrower, any other Loan Party or any other Person in any court or other
tribunal; (b) to make any claim in a liquidation or bankruptcy of the Borrower,
any other Loan Party, or any other Person; or (c) to make demand of the
Borrower, any other Loan Party or any other Person or to enforce or seek to
enforce or realize upon any collateral security held by the Lenders, the
Swingline Lender, the Issuing Lender or the Agent which may secure any of the
Guarantied Obligations.

 

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Section 3.                                           Guaranty Absolute. 
Guarantor, upon the occurrence of a Springing Recourse Event, guarantees that
the Guarantied Obligations will be paid strictly in accordance with the terms of
the documents evidencing the same, regardless of any Applicable Law now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of the Agent, the Lenders, the Issuing Lender or the Swingline Lender
with respect thereto.  Upon the occurrence of a Springing Recourse Event, the
liability of Guarantor under this Guaranty shall be absolute, irrevocable and
unconditional in accordance with its terms and shall remain in full force and
effect without regard to, and shall not be released, suspended, discharged,
terminated or otherwise affected by, any circumstance or occurrence whatsoever,
including without limitation, the following (whether or not Guarantor consents
thereto or has notice thereof and whether before or after the occurrence of a
Springing Recourse Event):

 

a.                                      (i) any change in the amount, interest
rate or due date or other term of any of the Guarantied Obligations, (ii) any
change in the time, place or manner of payment of all or any portion of the
Guarantied Obligations, (iii) any amendment or waiver of, or consent to the
departure from or other indulgence with respect to, the Credit Agreement, any
other Loan Document, or any other document or instrument evidencing or relating
to any Guarantied Obligations, or (iv) any waiver, renewal, extension, addition,
or supplement to, or deletion from, or any other action or inaction under or in
respect of, the Credit Agreement, any of the other Loan Documents, or any other
documents, instruments or agreements relating to the Guarantied Obligations or
any other instrument or agreement referred to therein or evidencing any
Guarantied Obligations or any assignment or transfer of any of the foregoing;

 

b.                                      any lack of validity or enforceability
of the Credit Agreement, any of the other Loan Documents, or any other document,
instrument or agreement referred to therein or evidencing any Guarantied
Obligations or any assignment or transfer of any of the foregoing;

 

c.                                       any furnishing to the Agent, the
Lenders, the Issuing Lender or the Swingline Lender of any security for the
Guarantied Obligations, or any sale, exchange, release or surrender of, or
realization on, any collateral securing any of the Obligations;

 

d.                                      any settlement or compromise of any of
the Guarantied Obligations, any security therefor, or any liability of any other
party with respect to the Guarantied Obligations, or any subordination of the
payment of the Guarantied Obligations to the payment of any other liability of
the Borrower or any other Loan Party;

 

e.                                       any bankruptcy, insolvency,
reorganization, composition, adjustment, dissolution, liquidation or other like
proceeding relating to Guarantor, the Borrower, any other Loan Party or any
other Person, or any action taken with respect to this Guaranty by any trustee
or receiver, or by any court, in any such proceeding;

 

f.                                        any act or failure to act by the
Borrower, any other Loan Party or any other Person which may adversely affect
Guarantor’s subrogation rights, if any, against the Borrower to recover payments
made under this Guaranty;

 

g.                                       any nonperfection or impairment of any
security interest or other Lien on any collateral, if any, securing in any way
any of the Obligations;

 

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h.                                      any application of sums paid by the
Borrower, any other Loan Party or any other Person with respect to the
liabilities of the Borrower to the Agent, the Lenders, the Issuing Lender or the
Swingline Lender, regardless of what liabilities of the Borrower remain unpaid;

 

i.                                          any defect, limitation or
insufficiency in the borrowing powers of the Borrower or in the exercise
thereof; or

 

j.                                         any other circumstance which might
otherwise constitute a defense available to, or a discharge of, Guarantor
hereunder (other than indefeasible payment and performance in full).

 

Section 4.                                           Action with Respect to
Guarantied Obligations.  The Lenders and the Agent may, at any time and from
time to time, without the consent of, or notice to, Guarantor, and without
discharging Guarantor from its obligations hereunder, take any and all actions
described in Section 3 and may otherwise:  (a) amend, modify, alter or
supplement the terms of any of the Guarantied Obligations, including, but not
limited to, extending or shortening the time of payment of any of the Guarantied
Obligations or changing the interest rate that may accrue on any of the
Guarantied Obligations; (b) amend, modify, alter or supplement the Credit
Agreement or any other Loan Document; provided, however, that no such amendments
can require Guarantor to modify the nature of the springing guaranty provided
hereunder without the approval of Guarantor; (c) sell, exchange, release or
otherwise deal with all, or any part, of any collateral securing any of the
Obligations; (d) release any other Loan Party or other Person liable in any
manner for the payment or collection of the Guarantied Obligations;
(e) exercise, or refrain from exercising, any rights against the Borrower, any
other Loan Party or any other Person; and (f) apply any sum, by whomsoever paid
or however realized, to the Guarantied Obligations in such order as the Lenders
shall elect.

 

Section 5.                                           Reserved.

 

Section 6.                                           Reserved.

 

Section 7.                                           Waiver.  Guarantor, to the
fullest extent permitted by Applicable Law, hereby waives notice of acceptance
hereof or any presentment, demand, protest or notice of any kind, and any other
act or thing, or omission or delay to do any other act or thing, which in any
manner or to any extent might vary the risk of Guarantor or which otherwise
might operate to discharge Guarantor from its obligations hereunder.

 

Section 8.                                           Inability to Accelerate
Loan.  If the Agent, the Swingline Lender, the Issuing Lender and/or the Lenders
are prevented under Applicable Law or otherwise from demanding or accelerating
payment of any of the Guarantied Obligations after the occurrence of a Springing
Recourse Event by reason of any automatic stay or otherwise, the Agent, the
Swingline Lender, the Issuing Lender and/or the Lenders shall be entitled to
receive from Guarantor, upon demand therefor, the sums which otherwise would
have been due had such demand or acceleration occurred.

 

Section 9.                                           Reinstatement of Guarantied
Obligations.  If claim is ever made on the Agent, any Lender, the Issuing Lender
or the Swingline Lender for repayment or recovery of any amount or amounts
received in payment or on account of any of the Guarantied Obligations, and the
Agent, such Lender, the Issuing Lender or the Swingline Lender repays all or
part of said amount by reason of (a) any judgment, decree or order of any court
or administrative body of competent jurisdiction, or

 

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(b) any settlement or compromise of any such claim effected by the Agent, such
Lender, the Issuing Lender or the Swingline Lender with any such claimant
(including the Borrower or a trustee in bankruptcy for the Borrower), then and
in such event Guarantor agrees that any such judgment, decree, order, settlement
or compromise shall be binding on it, notwithstanding any revocation hereof or
the cancellation of the Credit Agreement, any of the other Loan Documents, or
any other instrument evidencing any liability of the Borrower, and Guarantor
shall, upon the occurrence of a Springing Recourse Event, be and remain liable
to the Agent, such Lender, the Issuing Lender or the Swingline Lender for the
amounts so repaid or recovered to the same extent as if such amount had never
originally been paid to the Agent, such Lender, the Issuing Lender or the
Swingline Lender.

 

Section 10.                                    Subrogation.  Upon the making by
Guarantor of any payment hereunder for the account of the Borrower, Guarantor
shall be subrogated to the rights of the payee against the Borrower; provided,
however, that Guarantor shall not enforce any right or receive any payment by
way of subrogation or otherwise take any action in respect of any other claim or
cause of action Guarantor may have against the Borrower arising by reason of any
payment or performance by Guarantor pursuant to this Guaranty, unless and until
all of the Guarantied Obligations have been indefeasibly paid and performed in
full.  If any amount shall be paid to Guarantor on account of or in respect of
such subrogation rights or other claims or causes of action, Guarantor shall
hold such amount in trust for the benefit of the Agent, the Lenders, the Issuing
Lender and the Swingline Lender and shall forthwith pay such amount to the Agent
to be credited and applied against the Guarantied Obligations, whether matured
or unmatured, in accordance with the terms of the Credit Agreement or to be held
by the Agent as collateral security for any Guarantied Obligations existing.

 

Section 11.                                    Payments Free and Clear.  All
sums payable by Guarantor hereunder, whether of principal, interest, Fees,
expenses, premiums or otherwise, shall be paid in full, without set off or
counterclaim or any deduction or withholding whatsoever (including any Taxes
other than any Taxes withheld pursuant to Section 3.12. of the Credit Agreement
unless such Tax is an Indemnified Tax), and if Guarantor is required by
Applicable Law or by a Governmental Authority to make any such deduction or
withholding, Guarantor shall pay to the Agent, the Lenders, the Issuing Lender
and the Swingline Lender such additional amount as will result in the receipt by
the Agent, the Lenders, the Issuing Lender and the Swingline Lender of the full
amount payable hereunder had such deduction or withholding not occurred or been
required.

 

Section 12.                                    Set-off.  In addition to any
rights now or hereafter granted under any of the other Loan Documents or
Applicable Law and not by way of limitation of any such rights, Guarantor hereby
authorizes the Agent and each Lender, at any time during the continuance of an
Event of Default and after the occurrence of a Springing Recourse Event, without
any prior notice to Guarantor or to any other Person, any such notice being
hereby expressly waived, but in the case of a Lender or Participant subject to
receipt of the prior written consent of the Agent exercised in its sole
discretion, to set off and to appropriate and to apply any and all deposits
(general or special, including, but not limited to, indebtedness evidenced by
certificates of deposit, whether matured or unmatured) and any other
indebtedness at any time held or owing by the Agent, such Lender, or any
affiliate of the Agent or such Lender, to or for the credit or the account of
Guarantor against and on account of any of the Guarantied Obligations, although
such obligations shall be contingent or unmatured.  Guarantor agrees, to the
fullest extent permitted by Applicable Law and subject to the terms hereof, that
any Participant may exercise rights of setoff or counterclaim and other rights
with

 

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respect to its participation after the occurrence of a Springing Recourse Event
as fully as if such Participant were a direct creditor of Guarantor in the
amount of such participation.

 

Section 13.                                    Subordination.  Guarantor hereby
expressly covenants and agrees for the benefit of the Agent, the Lenders, the
Issuing Lender and the Swingline Lender that all obligations and liabilities of
the Borrower to Guarantor of whatever description, including without limitation,
all intercompany receivables of Guarantor from the Borrower (collectively, the
“Junior Claims”) shall be subordinate and junior in right of payment to all
Guarantied Obligations.  If an Event of Default shall exist, then Guarantor
shall not accept any direct or indirect payment (in cash, property or
securities, by setoff or otherwise) from the Borrower on account of or in any
manner in respect of any Junior Claim until all of the Guarantied Obligations
have been indefeasibly paid in full.

 

Section 14.                                    Avoidance Provisions.  It is the
intent of Guarantor, the Agent, the Lenders, the Issuing Lender and the
Swingline Lender that in any Proceeding, Guarantor’s maximum obligation
hereunder shall equal, but not exceed, the maximum amount which would not
otherwise cause the obligations of Guarantor hereunder (or any other obligations
of Guarantor to the Agent, the Lenders, the Issuing Lender and the Swingline
Lender) to be avoidable or unenforceable against Guarantor in such Proceeding as
a result of Applicable Law, including without limitation, (a) Section 548 of the
Bankruptcy Code of 1978, as amended (the “Bankruptcy Code”) and (b) any state
fraudulent transfer or fraudulent conveyance act or statute applied in such
Proceeding, whether by virtue of Section 544 of the Bankruptcy Code or
otherwise.  The Applicable Laws under which the possible avoidance or
unenforceability of the obligations of Guarantor hereunder (or any other
obligations of Guarantor to the Agent, the Lenders, the Issuing Lender and the
Swingline Lender) shall be determined in any such Proceeding are referred to as
the “Avoidance Provisions”.  Accordingly, to the extent that the obligations of
Guarantor hereunder would otherwise be subject to avoidance under the Avoidance
Provisions, the maximum Guarantied Obligations for which Guarantor shall be
liable hereunder shall be reduced to that amount which, as of the time any of
the Guarantied Obligations are deemed to have been incurred under the Avoidance
Provisions, would not cause the obligations of Guarantor hereunder (or any other
obligations of Guarantor to the Agent, the Lenders, the Issuing Lender and the
Swingline Lender), to be subject to avoidance under the Avoidance Provisions. 
This Section is intended solely to preserve the rights of the Agent, the
Lenders, the Issuing Lender and the Swingline Lender hereunder to the maximum
extent that would not cause the obligations of Guarantor hereunder to be subject
to avoidance under the Avoidance Provisions, and neither Guarantor nor any other
Person shall have any right or claim under this Section as against the Agent,
the Lenders, the Issuing Lender and the Swingline Lender that would not
otherwise be available to such Person under the Avoidance Provisions.

 

Section 15.                                    Information.  Guarantor assumes
all responsibility for being and keeping itself informed of the financial
condition of the Borrower and the other Loan Parties, and of all other
circumstances bearing upon the risk of nonpayment of any of the Guarantied
Obligations and the nature, scope and extent of the risks that Guarantor assumes
and incurs hereunder, and agrees that none of the Agent, the Lenders, the
Issuing Lender or the Swingline Lender shall have any duty whatsoever to advise
Guarantor of information regarding such circumstances or risks.

 

Section 16.                                    Governing Law.  THIS AGREEMENT
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK

 

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APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.

 

Section 17.                                    WAIVER OF JURY TRIAL.

 

a.                                      EACH PARTY HERETO ACKNOWLEDGES THAT ANY
DISPUTE OR CONTROVERSY BETWEEN OR AMONG GUARANTOR, THE AGENT OR ANY OF THE
LENDERS WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD
RESULT IN DELAY AND EXPENSE TO THE PARTIES.  ACCORDINGLY, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, EACH OF THE LENDERS, THE AGENT AND GUARANTOR HEREBY
WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR
NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED BY OR
AGAINST ANY PARTY HERETO ARISING OUT OF THIS GUARANTY OR ANY OTHER LOAN DOCUMENT
OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER BETWEEN OR
AMONG GUARANTOR, THE AGENT OR ANY OF THE LENDERS OF ANY KIND OR NATURE RELATING
TO ANY OF THE LOAN DOCUMENTS.

 

b.                                      EACH OF THE GUARANTOR, THE AGENT AND
EACH LENDER HEREBY AGREES THAT ANY FEDERAL DISTRICT COURT LOCATED IN NEW YORK
OR, AT THE OPTION OF THE AGENT, ANY STATE COURT LOCATED IN THE BOROUGH OF
MANHATTAN, NEW YORK, NEW YORK, SHALL HAVE JURISDICTION TO HEAR AND DETERMINE ANY
CLAIMS OR DISPUTES BETWEEN OR AMONG GUARANTOR, THE AGENT OR ANY OF THE LENDERS,
PERTAINING DIRECTLY OR INDIRECTLY TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT OR
TO ANY MATTER ARISING HEREFROM OR THEREFROM.  GUARANTOR AND EACH OF THE LENDERS
EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR
PROCEEDING COMMENCED IN SUCH COURTS WITH RESPECT TO SUCH CLAIMS OR DISPUTES. 
EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE
VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR
PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR
CLAIM THE SAME.  THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE
DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE AGENT OR ANY LENDER OR THE
ENFORCEMENT BY THE AGENT OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN
ANY OTHER APPROPRIATE JURISDICTION.

 

c.                                       THE PROVISIONS OF THIS SECTION HAVE
BEEN CONSIDERED BY EACH PARTY WITH THE ADVICE OF COUNSEL AND WITH A FULL
UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE PAYMENT
OF THE LOANS AND ALL OTHER AMOUNTS PAYABLE HEREUNDER OR UNDER THE OTHER LOAN
DOCUMENTS, THE TERMINATION OR EXPIRATION OF ALL LETTERS OF CREDIT AND THE
TERMINATION OF THIS GUARANTY.

 

Section 18.                                    Loan Accounts.  The Agent, each
Lender, the Issuing Lender and the Swingline Lender may maintain books and
accounts setting forth the amounts of principal, interest and other sums paid
and payable with respect to the Guarantied Obligations, and in the case of any

 

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dispute relating to any of the outstanding amount, payment or receipt of any of
the Guarantied Obligations or otherwise, the entries in such books and accounts
shall be deemed conclusive evidence of the amounts and other matters set forth
herein, absent manifest error.  The failure of the Agent, any Lender, the
Issuing Lender or the Swingline Lender to maintain such books and accounts shall
not in any way relieve or discharge Guarantor of any of its obligations
hereunder.

 

Section 19.                                    Waiver of Remedies.  No delay or
failure on the part of the Agent, any Lender, the Issuing Lender or the
Swingline Lender in the exercise of any right or remedy it may have against
Guarantor hereunder or otherwise shall operate as a waiver thereof, and no
single or partial exercise by the Agent, any Lender, the Issuing Lender or the
Swingline Lender of any such right or remedy shall preclude any other or further
exercise thereof or the exercise of any other such right or remedy.

 

Section 20.                                    Termination.  This Guaranty shall
remain in full force and effect until the termination of the Credit Agreement in
accordance with Section 13.10. of the Credit Agreement.

 

Section 21.                                    Successors and Assigns.  Each
reference herein to the Agent or the Lenders shall be deemed to include such
Person’s respective successors and assigns (including, but not limited to, any
holder of the Guarantied Obligations) in whose favor the provisions of this
Guaranty also shall inure, and each reference herein to Guarantor shall be
deemed to include Guarantor’s successors and assigns, upon whom this Guaranty
also shall be binding.  The Lenders, the Issuing Lender and the Swingline Lender
may, in accordance with the applicable provisions of the Credit Agreement,
assign, transfer or sell any Guarantied Obligation, or grant or sell
participations in any Guarantied Obligations, to any Person without the consent
of, or notice to, Guarantor and without releasing, discharging or modifying
Guarantor’s obligations hereunder.  Subject to Section 13.8. of the Credit
Agreement, Guarantor hereby consents to the delivery by the Agent or any Lender
to any Assignee or Participant (or any prospective Assignee or Participant) of
any financial or other information regarding the Borrower or Guarantor. 
Guarantor may not assign or transfer its obligations hereunder to any Person
without the prior written consent of all Lenders and any such assignment or
other transfer to which all of the Lenders have not so consented shall be null
and void.

 

Section 22.                                    [Intentionally Omitted.]

 

Section 23.                                    Amendments.  This Guaranty may
not be amended other than in writing in accordance with the terms of
Section 13.6. of the Credit Agreement.

 

Section 24.                                    Payments.  All payments to be
made by Guarantor pursuant to this Guaranty shall be made in Dollars, in
immediately available funds to the Agent at the Principal Office, not later than
2:00 p.m. on the date of demand therefor.

 

Section 25.                                    Notices.  All notices, requests
and other communications hereunder shall be in writing (including facsimile
transmission or similar writing) and shall be given (a) to Guarantor at its
address set forth below its signature hereto, (b) to the Agent, any Lender, the
Issuing Lender or the Swingline Lender at its respective address for notices
provided for in the Credit Agreement, or (c) as to each such party at such other
address as such party shall designate in a written notice to the other parties. 
Each such notice, request or other communication shall be effective (i) if
mailed, when

 

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received; (ii) if telecopied, when transmitted; or (iii) if hand delivered, when
delivered; provided, however, that any notice of a change of address for notices
shall not be effective until received.

 

Section 26.                                    Severability.  In case any
provision of this Guaranty shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.

 

Section 27.                                    Headings.  Section headings used
in this Guaranty are for convenience only and shall not affect the construction
of this Guaranty.

 

Section 28.                                    Limitation of Liability.  Neither
the Agent nor any Lender, nor any affiliate, officer, director, employee,
attorney, or agent of the Agent or any Lender, shall have any liability with
respect to, and Guarantor hereby waives, releases, and agrees not to sue any of
them upon, any claim for any special, indirect, incidental, or consequential
damages suffered or incurred by Guarantor in connection with, arising out of, or
in any way related to, this Guaranty or any of the other Loan Documents, or any
of the transactions contemplated by this Guaranty, the Credit Agreement or any
of the other Loan Documents.  Guarantor hereby waives, releases, and agrees not
to sue the Agent or any Lender or any of the Agent’s or any Lender’s affiliates,
officers, directors, employees, attorneys, or agents for punitive damages in
respect of any claim in connection with, arising out of, or in any way related
to, this Guaranty, the Credit Agreement or any of the other Loan Documents, or
any of the transactions contemplated by Credit Agreement or financed thereby.

 

Section 29.                                    Definitions.  a.  For the
purposes of this Guaranty:

 

“Proceeding” means any of the following:  (i) a voluntary or involuntary case
concerning Guarantor shall be commenced under the Bankruptcy Code of 1978, as
amended; (ii) a custodian (as defined in such Bankruptcy Code or any other
applicable bankruptcy laws) is appointed for, or takes charge of, all or any
substantial part of the property of Guarantor; (iii) any other proceeding under
any Applicable Law, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding up or composition for adjustment of debts, whether now
or hereafter in effect, is commenced relating to Guarantor; (iv) Guarantor is
adjudicated insolvent or bankrupt; (v) any order of relief or other order
approving any such case or proceeding is entered by a court of competent
jurisdiction; (vi) Guarantor makes a general assignment for the benefit of
creditors; (vii) Guarantor shall fail to pay, or shall state that it is unable
to pay, or shall be unable to pay, its debts generally as they become due;
(viii) Guarantor shall call a meeting of its creditors with a view to arranging
a composition or adjustment of its debts; (ix) Guarantor shall by any act or
failure to act indicate its consent to, approval of or acquiescence in any of
the foregoing; or (x) any corporate action shall be taken by Guarantor for the
purpose of effecting any of the foregoing.

 

b.                                      Terms not otherwise defined herein are
used herein with the respective meanings given them in the Credit Agreement.

 

[Signature on Next Page]

 

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IN WITNESS WHEREOF, Guarantor has duly executed and delivered this Guaranty as
of the date and year first written above.

 

 

GUARANTOR:

 

 

 

 

 

KITE REALTY GROUP TRUST

 

 

 

 

 

By:

/s/ Daniel R. Sink

 

Name:

Daniel R. Sink

 

Title:

Executive Vice President and Chief Financial

 

 

Officer

 

 

 

 

 

Address for Notices:

 

 

 

Kite Realty Group Trust

 

30 S. Meridian Street, Suite 1100

 

Indianapolis, Indiana  46204

 

Attention:  Chief Financial Officer

 

Telecopy Number:

(317) 577-5605

 

Telephone Number:

(317) 577-5600

 

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