Document:

Exhibit 10.3

 

AMENDMENT
TO AGREEMENT AND PLAN OF MERGER

 

This
AMENDMENT TO AGREEMENT AND PLAN OF MERGER (this “Amendment”) is entered into as
of August 10, 2004 by and among Kite Realty Group Trust, a Maryland real
estate investment trust (the “REIT”), KRG Construction, LLC, an Indiana limited
liability company (the “Limited Liability Company”) and Kite Construction, Inc.
(the “Acquired Company”).

 

WHEREAS,
the REIT, the Limited Liability Company and the Acquired Company have entered
into that certain Agreement and Plan of Merger (the “Merger Agreement”) dated
as of April 5, 2004, pursuant to which, among other things, the Acquired
Company will merge with and into the Limited Liability Company, with the
Limited Liability Company surviving such merger in accordance with the terms of
the Merger Agreement (the “Merger”);

 

WHEREAS,
the REIT, the Limited Liability Company and the Acquired Company desire to
amend the Merger Agreement as provided below to eliminate the provision
purporting to change the name of the Limited Liability Company following the
Merger;

 

WHEREAS,
the Board of Directors of the Acquired Company has approved and adopted the
Merger Agreement, as amended by this Amendment (the “Amended Merger Agreement”)
by unanimous written consent, proposed and recommended that the shareholders of
the Acquired Company approve and adopt the Amended Merger Agreement and
submitted the Amended Merger Agreement for approval and adoption by the
shareholders of the Acquired Company;

 

WHEREAS,
the shareholders of the Acquired Company have approved and adopted the Amended
Merger Agreement by unanimous written consent in accordance with the applicable
provisions of the Indiana Business Corporation Law and the articles of
incorporation and the bylaws of the Acquired Company; and

 

WHEREAS,
the REIT, as sole member of the Limited Liability Company has approved and
adopted the Amended Merger Agreement in accordance with the applicable
provisions of the Indiana Business Flexibility Act and the operating agreement
of the Limited Liability Company.

 

NOW
THEREFORE, for good and valuable consideration and in consideration of the
foregoing, the REIT, the Limited Liability Company and the Acquired Company
agree as follows:

 

1.                                       The Merger Agreement is hereby amended by
deleting from the end of the last sentence of Section 1.1 the following
phrase:

 

“,
and its name shall be changed to “Kite Construction, LLC”

 

 

 

2.             Except as expressly provided in
this Amendment, the Merger Agreement shall remain unchanged and in full force
and effect.

 

3.                                       This Amendment shall be governed in all
respects, including validity, interpretation and effect, by the laws of the
State of Indiana.

 

4.                                       This Amendment may be executed in one or more
counterparts, each of which will be deemed an original and all of which shall
constitute one and the same instrument.

 

 

IN
WITNESS WHEREOF, each of the parties hereto has executed and delivered this
Amendment, or has caused this Agreement to be executed and delivered on its
behalf, as of the date first set forth above.

 

 

	
   

  	
  KITE
  REALTY GROUP TRUST

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  DANIEL R. SINK

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Daniel
  R. Sink

  
	
   

  	
   

  	
  Title:

  	
  Chief
  Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  KRG
  CONSTRUCTION, LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  JOHN KITE

  	
   

  
	
   

  	
   

  	
  Name:

  	
  John
  Kite

  
	
   

  	
   

  	
  Title:

  	
  President
  and CEO, Kite Realty

  Group Trust, its Sole Member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  KITE
  CONSTRUCTION, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  DANIEL R. SINK

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Daniel
  R. Sink

  
	
   

  	
   

  	
  Title:

  	
  Chief
  Financial OfficerExhibit 10.4

 

AGREEMENT AND PLAN OF MERGER

 

THIS AGREEMENT AND PLAN
OF MERGER (this “Agreement”) is entered into as of April 5, 2004 by and
among Kite Realty Group Trust, a Maryland real estate investment trust (the
“REIT”), KRG Development, LLC, an Indiana limited liability company (the
“Limited Liability Company”) and Kite Development Corporation, an Indiana
corporation (the “Acquired Company”).

WHEREAS, the REIT and
Kite Realty Group, L.P., a Delaware limited partnership, of which the REIT is
the indirect general partner (“Kite Realty”), are considering engaging in
various related transactions pursuant to which, among other things, (i) Kite
Realty would acquire interests in various entities that own or lease real
estate properties in which certain affiliated persons of the Acquired Company
have interests; (ii) the Limited Liability Company, of which the REIT is the
sole member, would acquire interests in certain service businesses currently
conducted by the Acquired Company and certain affiliated persons, and (iii) the
REIT would effect an initial public offering of its common shares and
contribute the proceeds therefrom for a like number of units of partnership
interest in Kite Realty (the “Kite IPO,” and together with the other
transactions described above, the “Kite IPO Transactions”);

WHEREAS, the authorized
capital stock of the Acquired Company consists of  1,000 shares of common stock, without par value (the “Common
Stock”), of which 1,000 shares are issued and outstanding;

 

WHEREAS, the shareholders
listed on Schedule 1 attached hereto (the “Shareholders”) own 100%
of the issued and outstanding Common Stock of the Acquired Company;

 

WHEREAS, the REIT is the
sole member of the Limited Liability Company;

 

WHEREAS, the parties
hereto have determined it to be in their respective best interests, on the
terms and conditions hereinafter set forth, that the Acquired Company be merged
with and into the Limited Liability Company, with the Limited Liability Company
surviving (the “Merger”) and the Shareholders receiving common shares of
beneficial interest, par value $0.01 per share, of the REIT (“REIT Common
Shares”);

 

WHEREAS, for federal
income tax purposes, it is intended that the Merger shall qualify as a
reorganization under Section 368(a) of the Internal Revenue Code of 1986,
as amended (the “Code”), and that this Agreement shall constitute a plan of
reorganization under Section 368(a) of the Code;

 

WHEREAS, the Board of
Directors of the Acquired Company has approved and adopted this Agreement and
the Merger, on the terms and subject to the conditions set forth in this
Agreement, proposed and recommended that the shareholders of the Acquired
Company approve and adopt this Agreement and the Merger and submitted this
Agreement and the Merger for approval and adoption by the shareholders of the
Acquired Company;

 

 

WHEREAS, concurrently
with the execution and delivery of this Agreement the Shareholders are
approving and adopting this Agreement and the Merger, on the terms and subject
to the conditions set forth in this Agreement, including the other transactions
contemplated hereby, by unanimous written consent of the Shareholders dated as
of the date hereof (the “Shareholder Consent”), in accordance with the
applicable provisions of the Indiana Business Corporation Law (the “IBCL”) and
the articles of incorporation and by-laws of the Acquired Company; and

 

WHEREAS, the REIT, as the
sole member of the Limited Liability Company, has approved and adopted this
Agreement and the Merger, on the terms and subject to the conditions set forth
in this Agreement, including the other transactions contemplated hereby in
accordance with the applicable provisions of the Indiana Business Flexibility
Act (the “IBFA”) and the operating agreement of the Limited Liability Company.

 

NOW, THEREFORE, for good
and valuable consideration and in consideration of the foregoing and of the
representations, warranties, covenants and agreements hereinafter set forth,
the parties, each intending to be legally bound hereby, agree as follows:

 

ARTICLE I:                                  PLAN
OF MERGER

 

1.1                                 Merger.
Upon the terms and subject to the conditions hereof, and in accordance with the
provisions of Section 23-18-7 et. seq. of the IBFA and
Section 23-1-40 et. seq. of the IBCL, the Acquired Company shall be merged
with and into the Limited Liability Company at the Effective Time (as defined
below).  The Limited Liability Company
shall be the surviving entity resulting from the Merger (the “Surviving
Entity”), and the separate existence of the Acquired Company will cease.  The Surviving Entity shall continue its
existence as a limited liability company under the laws of the State of
Indiana, and its name shall be changed to “Kite Development, LLC.”

 

1.2                                 Closing.
Subject to the terms and conditions of this Agreement, the closing hereunder
(the “Closing”) shall occur, at the election of the REIT, (i) one business day
prior to the closing of the Kite IPO, (ii) concurrently with the closing of the
Kite IPO, or (iii) one business day following the closing of the Kite IPO,
which date the Limited Liability Company shall designate in writing to the
Acquired Company at least five business days prior to such date, at the same
location as the closing of the Kite IPO, provided that the conditions for the
Closing as set forth in Article IV hereof shall have occurred (or have
been waived by the party that benefits from such conditions), and this
Agreement shall not have been terminated pursuant to Article VI
hereof.  The date on which the Closing
occurs is referred to herein as the “Closing Date.”

 

1.3                                 Effective
Time. If all the conditions to the Merger set forth in Article IV
shall have been satisfied or waived in accordance herewith and this Agreement
shall not have been terminated as provided in Article VI, following the
Closing, the parties hereto shall, at such time as they deem advisable, cause
articles of merger (the “Articles of Merger”) to be filed with the Secretary of
State of the State of Indiana in accordance with Section 23-1-40-5 and
other applicable provisions of the IBCL and the applicable provisions

 

2

 

of the IBFA. The Merger
shall become effective on the filing of the Articles of Merger with the
Secretary of State of the State of Indiana, or such other time specified in the
Articles of Merger (the “Effective Time”).

 

1.4                                 Operating
Agreement. The operating agreement of the Limited Liability Company in
effect immediately prior to the Effective Time shall be the operating agreement
of the Surviving Entity (subject to any subsequent amendment).

 

1.5                                 Effects
of the Merger. The merger shall have the effects set forth in
Section 23-1-40-6 of the IBCL and Section 23-18-7-5 of the IBFA.

 

1.6                                 Taxation.
It is intended that the Merger shall be treated, for federal income tax
purposes, as a reorganization under Section 368(a) of the Code and that
this Agreement shall constitute a plan of reorganization under
Section 368(a) of the Code. It is also intended that the Limited Liability
Company be disregarded as an entity separate from its owner for federal income
tax purposes. For this reason, the Limited Liability Company will not elect to
be classified as a corporation for any period prior to the effective time of
the Merger. The Limited Liability Company will be treated by default as an
entity disregarded as separate from its owner pursuant to Treasury Regulations
Section 301.7701-3(b)(1)(ii) for all periods prior to the effective time
of the Merger.  Furthermore, it is
intended that, if permissible under relevant state law, the Limited Liability
Company be disregarded as an entity separate from its owner for state tax
purposes.

 

ARTICLE II:  EFFECT ON CAPITAL STOCK AND MEMBERSHIP
INTEREST

 

2.1                                 Effect
on Capital Stock of the Acquired Company. At the Effective Time, by virtue
of the Merger and without any action on the part of the holder of any shares of
Common Stock of the Acquired Company:

 

(a)           Outstanding Capital Stock.
Each issued and outstanding share of Common Stock of the Acquired Company shall
be converted into and become a number of fully paid and nonassessable REIT
Common Shares equal to (a) $100.00 divided by (b) the public offering price per
share for REIT Common Shares as set forth in the REIT’s final prospectus
relating to the Kite IPO (rounded to the nearest whole REIT Common Share).

 

(b)           Cancellation of Company Owned
Stock. Any shares of Common Stock that are owned by the Acquired Company
shall be canceled and retired and no consideration shall be delivered or
deliverable in exchange therefor.

 

(c)                                  Stock
Certificates.  At the Effective
Time, each certificate representing shares of Common Stock of the Acquired
Company will be deemed for all purposes to evidence the same number of REIT
Common Shares until such certificate is exchanged for a certificate
representing REIT Common Shares.  Following
the Effective Time, the REIT shall issue certificates representing the number
of REIT Common Shares to the Shareholders upon surrender by the Shareholders of
the certificates, properly endorsed for transfer, representing shares of Common
Stock of the Acquired Company, together with such other documents as may be
reasonably requested by the REIT in connection therewith.

 

3

 

2.2                                 Outstanding
Membership Interests. The 100% interest of the REIT in the Limited
Liability Company shall continue unchanged as a 100% interest of the Surviving
Entity.

 

ARTICLE III: 
REPRESENTATIONS, WARRANTIES AND COVENANTS OF

THE ACQUIRED COMPANY AND THE SHAREHOLDERS

 

As a material inducement
to the REIT and the Limited Liability Company to enter into this Agreement and
to consummate the transactions contemplated hereby, the Acquired Company (and
in the case of Sections 3.4, 3.5 and 3.8 only, the Acquired Company and the
Shareholders severally, but not jointly) hereby makes to the REIT and the
Limited Liability Company each of the representations and warranties set forth
in this Article III, which representations and warranties are true and
correct as of the date hereof.

 

3.1                                 Authority;
No Conflicts.  The Acquired Company
has all requisite corporate power and authority to execute and deliver this
Agreement and to consummate the Merger and the other transactions contemplated
hereby.  The execution and delivery by
the Acquired Company of this Agreement and the consummation by the Acquired
Company of the Merger and the other transactions contemplated hereby have been
duly authorized by all necessary corporate action on the part of the Acquired
Company.  The Acquired Company has duly
executed and delivered this Agreement, and this Agreement constitutes its
legal, valid and binding obligation, enforceable against it in accordance with
its terms.  Subject to the receipt of
the Shareholder Consent, the execution, delivery and performance of this Agreement
and each such agreement, document and instrument by or on behalf of the
Acquired Company and compliance with the terms hereof and thereof, and the
consummation of the Merger and the other transactions contemplated hereby, (i)
does not and will not violate any foreign, federal, state, local or other laws
applicable to the Acquired Company or require the Acquired Company to obtain
any approval, consent or waiver of, or make any filing with, any person or
authority (governmental or otherwise) that will not be obtained or made prior
to the Closing, other than the filing of the Articles of Merger; (ii) does not
and will not violate the Acquired Company’s organizational documents; and (iii)
does not and will not violate any term, conditions or provisions of, or
constitute a default under, any bond, note or other evidence of indebtedness or
any contract, lease or other instrument to which the Acquired Company is a
party or by which the property of the Acquired Company is bound or affected or
result in the creation of any Encumbrance on the property or assets of the
Acquired Company.

 

3.2                                 Capital
Structure.  The authorized capital
stock of the Acquired Company is as set forth in the recitals hereto.  Schedule 1 hereto sets for the
number of shares of Common Stock issued and outstanding and the owner thereof.  No shares of Company Common Stock are held
by the Acquired Company in its treasury. 
Except as set forth on Schedule 1 hereto, no shares of
capital stock or other voting securities of the Acquired Company are issued,
reserved for issuance or outstanding. 
All outstanding shares of Common Stock are duly authorized, validly
issued, fully paid and nonassessable and not subject to or issued in violation
of any purchase option, call option, right of first refusal, preemptive right,
subscription right or any similar right under any provision of the IBCL, the
Acquired Company’s articles of incorporation or bylaws or any contract to which
the Acquired Company is a party or otherwise bound.  There are no bonds, debentures, notes or other indebtedness of
the Acquired Company having the right to vote on any

 

4

 

matters on which holders
of Common Stock may vote.  There are not
any options, warrants, rights, contracts, arrangements or undertakings of any
kind to which the Acquired Company is a party or by which it is bound
obligating the Acquired Company to issue, grant, sell or cause to be issued,
granted or sold, additional shares of capital stock or other equity interests
in, or any security convertible or exercisable for or exchangeable into any
capital stock of or other equity interest in, the Acquired Company.

 

3.3                                 Litigation.  There is no litigation or proceeding, either
judicial or administrative, pending or, to the Acquired Company’s knowledge,
threatened, affecting any Common Stock or the Acquired Company’s ability to
consummate the transactions contemplated hereby.  There is no outstanding order, writ, injunction or decree of any
court, government, governmental entity or authority or arbitration against or
affecting the Acquired Company, which in any such case would impair the
Acquired Company’s ability to enter into and perform all of its obligations
under this Agreement.

 

3.4                                 No
Agreements to Sell. Other than this Agreement, no Shareholder is currently
a party to any agreement to sell, transfer or otherwise encumber or dispose of
any Common Stock.

 

3.5                                 Status
as a United States Person.  Each
Shareholder represents and warrants that such Shareholder is not a foreign
person within the meaning of Section 1445 of the Code
(“Section 1445”).  The
Shareholder’s U.S. social security number (in the case of an individual) or
taxpayer identification number (in the case of an entity) that has previously
been provided to the Acquired Company is correct.  The Shareholder’s home address (in the case of an individual) or
office address (in the case of an entity) is that address indicated on the
signature page attached hereto. Upon request by the REIT, each Shareholder
agrees to complete and provide to the REIT prior to the Closing a certificate
of non-foreign status substantially in the form provided in
Section 1.1445-5(b)(3)(D) of the Treasury regulations.

 

3.6                                 No
Insolvency Proceedings.  No
attachments, execution proceedings, assignments for the benefit of creditors,
insolvency, bankruptcy, reorganization or other proceedings are pending or, to
the Acquired Company’s knowledge, threatened against the Acquired Company, nor
are any such proceedings contemplated by the Acquired Company.

 

3.7                                 No
Brokers.  The Acquired Company represents
that it has not entered into, and covenants that it will not enter into, any
agreement, arrangement or understanding with any person or firm which will
result in the obligation of the REIT to pay any finder’s fee, brokerage
commission or similar payment in connection with the transactions contemplated
hereby.

 

3.8                                 Securities
Law Matters; Restrictions on Transfer.

 

(a)                                  The
Acquired Company and the Shareholders acknowledge that the REIT intends the
offer and issuance of the REIT Common Shares to be exempt from registration
under the Securities Act of 1933, as amended (the “Securities Act”) and
applicable state securities laws by virtue of (i) the status of the
Shareholders as “accredited investors” within the meaning of the federal
securities laws, and (ii) Section 4(2) of the Securities Act, and
that the REIT will rely in part upon the representations and warranties

 

5

 

made by the Acquired
Company and the Shareholders in this Agreement in making the determination that
the offer and issuance of the REIT Common Shares qualify for exemption under
Section 4(2) of the Securities Act.

 

(b)                                 Each
Shareholder is an “accredited investor” within the meaning of the federal
securities laws.

 

(c)                                  Each
Shareholder will acquire the REIT Common Shares for his own account and not
with a view to, or for sale in connection with, any “distribution” thereof
within the meaning of the Securities Act. Each Shareholder does not intend or
anticipate that the Shareholder will rely on its investment in the REIT Common
Shares as a principal source of income.

 

(d)                                 Each
Shareholder has sufficient knowledge and experience in financial, tax and
business matters to enable the Shareholder to evaluate the merits and risks of
investment in the REIT Common Shares. Each Shareholder has adequate means of
providing for the Shareholder’s current and anticipated financial needs and
contingencies, has the ability to bear the economic risk of acquiring the REIT
Common Stock for an indefinite period of time and has no need for liquidity in
the REIT Common Stock and could afford loss of all such investment. The
Acquired Company and each Shareholder acknowledges that (i) the
transactions contemplated by this Agreement involve complex tax consequences
for the Shareholders, and the Shareholders are relying solely on the advice of
their own respective tax advisors in evaluating such consequences,
(ii) neither the REIT nor the Limited Liability Company has made (nor
shall it be deemed to have made) any representations or warranties as to the
tax consequences of such transaction to the Acquired Company or the
Shareholders, and (iii) references in this Agreement to the intended tax
effect of the transactions contemplated hereby shall not be deemed to imply any
representation by the REIT or the Limited Liability Company as to a particular
tax effect that may be obtained by the Shareholders.  The Shareholders remain solely responsible for all tax matters
relating to them.

 

(e)                                  The
Acquired Company and the Shareholders have been supplied with, or had access
to, information to which a reasonable investor would attach significance in
making an investment decision to acquire the REIT Common Shares and any other
information the Acquired Company or either Shareholder has requested.  The Acquired Company and the Shareholders
have had an opportunity to ask questions of, and receive information and
answers from, the REIT concerning the REIT, the REIT Common Shares and the
other Kite IPO Transactions, and to assess and evaluate any information
supplied to them by the REIT, and all such questions have been answered, and
all such information has been provided to their respective full satisfaction.

 

(f)                                    The
Acquired Company and the Shareholders acknowledge that they are aware that there
are substantial restrictions on the transferability of the REIT Common Shares
and that the REIT Common Shares will not be registered under the Securities Act
or any state securities laws. Each Shareholder agrees that any REIT Common
Shares the Shareholder acquires will not be sold in the absence of registration
unless such sale is exempt from registration under the Securities Act and
applicable state securities laws.  Each
Shareholder acknowledges that the Shareholder shall be responsible for
compliance with all conditions on transfer imposed by any securities authority
and for

 

6

 

any expenses incurred by
the REIT for legal or accounting services in connection with reviewing such a
proposed transfer or issuing opinions in connection therewith.

 

(g)                                 The
Acquired Company and the Shareholders understand that no federal agency
(including the Securities and Exchange Commission) or state agency has made or
will make any finding or determination as to the fairness of an investment in
the REIT Common Shares (including as to the merger consideration).

 

(h)                                 The
Acquired Company and the Shareholders understand that Rule 144 promulgated
under the Securities Act is not currently available with respect to the sale of
REIT Common Shares.

 

(i)                                     All certificates representing REIT Common
Shares shall bear a restrictive legend in substantially the form set forth
below (or a legend of like effect)  in
conspicuous type (together with any other legends required by law or otherwise
placed on such certificates):

 

THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (“SECURITIES ACT”), OR UNDER APPLICABLE
STATE SECURITIES LAWS (“STATE ACTS”) AND MAY BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED ONLY UPON REGISTRATION UNDER THE SECURITIES ACT AND THE STATE ACTS
OR PURSUANT TO AN EXEMPTION THEREFROM.

 

In addition, all such
certificates shall bear an appropriate restrictive legend specifying that the
REIT Common Shares represented by such certificate are held by an affiliate of
the REIT (or, in the absence of such a legend, an appropriate notation shall be
made in the records of the REIT and/or appropriate stop-transfer instructions
shall be issued to the transfer agent).

 

ARTICLE IV: CONDITIONS
TO EACH PARTY’S OBLIGATION TO

EFFECT THE MERGER

 

4.1                                 Conditions
to the REIT’s and the Limited Liability Company’s Obligations to Effect the
Merger.  The obligations of the REIT
and the Limited Liability Company to effect the Merger and the other transactions
contemplated by this Agreement are subject to the fulfillment, at or prior to
the Closing, of the following conditions (unless such conditions are waived in
writing by the REIT and the Limited Liability Company):

 

(a)                                  Other
Kite IPO Transactions.  The other
Kite IPO Transactions, in such form(s) as the REIT, in its sole and absolute
discretion, shall have determined to be acceptable, shall have occurred (or are
occurring simultaneously with the Closing).

 

(b)                                 Representations
and Warranties.  The representations
and warranties made by the Acquired Company and the Shareholders pursuant to
this Agreement shall be true and correct in all respects when made, and on and
as of the

 

7

 

Closing Date, as though
such representations and warranties were made on the Closing Date.

 

(c)                                  Performance.  The Acquired Company shall have performed
and complied with all agreements and covenants that it is required to perform
or comply with pursuant to this Agreement prior to the Closing.

 

(d)                                 Legal
Proceedings.  No action or
proceeding by or before any governmental authority shall have been instituted
that is reasonably expected to restrain, prohibit or invalidate the
transactions contemplated by this Agreement, including the Merger, other than
an action or proceeding instituted by the Acquired Company or the Shareholders.

 

(e)                                  Consents
and Approvals.  The Shareholder
Consent and all other necessary consents of governmental and private parties to
effect the Merger and the other transactions contemplated by this Agreement,
including, without limitation, consents of any lenders, shall have been
obtained.

 

4.2                                 Conditions
to the Acquired Company’s Obligation to Effect the Merger.  The obligation of the Acquired Company to
effect the Merger and the other transactions contemplated by this Agreement is
subject to the fulfillment, at or prior to the Closing, of the following
conditions (unless such conditions are waived in writing by the Acquired
Company):

 

(a)                                  Performance.  Each of the REIT and the Limited Liability
Company shall have performed and complied with all agreements and covenants
that it is required to perform or comply with pursuant to this Agreement prior
to the Closing.

 

(b)                                 Legal
Proceedings.  No action or
proceeding by or before any governmental authority shall have been instituted
that is reasonably expected to restrain, prohibit or invalidate the
transactions contemplated by this Agreement including the Merger, other than an
action or proceeding instituted by the REIT or the Limited Liability Company;
provided, that the foregoing condition shall be deemed to have been satisfied
if the REIT or the Limited Liability Company shall have fully indemnified the
Shareholders from any loss, liability, claim, damage or expense arising out of
the Acquired Company’s proceeding to effect the Merger in the face of any such
action or proceeding.

 

(c)                                  Consents
and Approvals.  The Shareholder
Consent and all other necessary consents of governmental and private parties to
effect the Merger and other transactions contemplated by this Agreement,
including, without limitation, consents of any lenders, shall have been
obtained; provided, that the foregoing condition shall be deemed to have been
satisfied if the REIT or the Limited Liability Company shall have fully
indemnified the Shareholders from any loss, liability, claim, damage or expense
arising out of the Acquired Company’s proceeding to effect the Merger without
having obtained a necessary consent.

 

(d)                                 Registration
Rights Agreement.  The REIT shall
have entered into a registration rights agreement with the Shareholder
providing the Shareholder with registration rights that register the resale of
REIT Common Shares issued pursuant to this

 

8

 

Agreement, such
registration rights agreement to contain such other terms and conditions
customary for a transaction of this type.

 

ARTICLE V: 
OTHER COVENANTS AND AGREEMENTS

 

5.1                                 Conditional
Nature of Transaction.  The Acquired
Company acknowledges and understands that it is a condition to the REIT’s
obligations to close the transactions contemplated hereby that the other Kite
IPO Transactions shall have occurred (or are occurring simultaneously with the
Closing), that the occurrence of any of the other Kite IPO Transactions is
wholly within the sole and absolute discretion of the REIT and its affiliates,
and that the Acquired Company has no right to force any of the other Kite IPO
Transactions to occur, on any terms.

 

5.2                                 Further
Assurances.  The Acquired Company
shall execute and deliver to the REIT and the Limited Liability Company all
such other and further instruments and documents and take or cause to be taken
all such other and further actions as the REIT or the Limited Liability Company
may reasonably request in order to effect the Merger and the other transactions
contemplated by this Agreement.

 

ARTICLE VI: TERMINATION

 

6.1                                 Termination
and Abandonment by the REIT.  The
REIT shall have the right to terminate this Agreement and abandon the Merger at
any time prior to the filing of the Articles of Merger, before or after
approval by the Shareholders or the REIT, as sole member of the Limited
Liability Company, following the occurrence of any of the following events:

 

(i)                                     the
determination by the REIT, in its sole and absolute discretion, not to proceed
with the Kite IPO Transactions;

 

(ii)                                  the
determination by the REIT, in its sole and absolute discretion, not to proceed
with the Merger on the terms outlined herein; or

 

(iii)                               at
any time on or after January 1, 2005, for any reason.

 

6.2                                 Termination
and Abandonment by the Acquired Company. 
The Acquired Company shall have the right to terminate this Agreement
and abandon the Merger at any time and for any reason on or after
January 1, 2005, but prior to the filing of the Articles of Merger,
whether or not such termination occurs before or after approval by the
Shareholders or the REIT, as sole member of the Limited Liability Company.

 

6.3                                 Effect
of Termination and Abandonment. 
Upon the termination of this Agreement and abandonment of the Merger
pursuant to Section 6.1 or 6.2 hereof, this Agreement shall become void
and have no effect, and no party shall have any liability to the other in
connection with the transactions contemplated hereby, including the Merger or
as a result of the termination of this Agreement; provided, that the foregoing
shall not relieve a party of any liability as a result of a breach of any of
the terms of this Agreement.

 

9

 

ARTICLE VII: 
MISCELLANEOUS

 

7.1                                 Amendment;
Waiver.  Any amendment hereto shall
be effective only if signed by all parties hereto.  No waiver of any provisions of this Agreement shall be valid
unless in writing and signed by the party against whom enforcement is sought.

 

7.2                                 Entire
Agreement; Counterparts; Applicable Law. 
This Agreement shall (a) constitute the entire agreement between the
parties hereto with respect to the transactions expressly contemplated hereby
and supersedes all prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof, (b) may be
executed in one or more counterparts, each of which will be deemed an original
and all of which shall constitute one and the same instrument, and (c) shall be
governed in all respects, including validity, interpretation and effect, by the
laws of the State of Indiana.

 

7.3                                 Assignability.  This Agreement shall be binding upon, and
shall be enforceable by and inure to the benefit of, the parties hereto and
their respective heirs, legal representatives, successors and assigns;
provided, however, that this Agreement may not be assigned (except by operation
of law) by any party without the prior written consent of the other parties,
and any attempted assignment without such consent shall be void and of no
effect; provided, further, however, that the Limited Liability Company may
assign this Agreement and any agreement contemplated hereunder or thereunder to
an affiliate of the Limited Liability Company, or to any entity into which the
Limited Liability Company is reorganized without the consent of the Acquired
Company.

 

7.4                                 Severability.  If any provision of this Agreement, or the
application thereof, is for any reason held to any extent to be invalid or unenforceable,
the remainder of this Agreement and application of such provision to other
persons or circumstances will be interpreted so as reasonably to effect the
intent of the parties hereto.  The
parties further agree to replace such void or unenforceable provision of this
Agreement with a valid and enforceable provision that will achieve, to the
extent possible, the economic, business and other purposes of the void or
unenforceable provision and to execute any amendment, consent or agreement
deemed necessary or desirable by the REIT to effect such replacement.

 

7.5                                 Equitable
Remedies.  The parties hereto agree
that irreparable damage would occur if any provision of this Agreement was not
performed in accordance with its specific terms or was otherwise breached.  It is accordingly agreed that the parties
shall be entitled to an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions hereof in any
federal or state court located in the State of Indiana (as to which the parties
agree to submit to jurisdiction for the purposes of such action), this being in
addition to any other remedy to which they are entitled at law or in equity.

 

7.6                                 Time
of the Essence.  Time is of the
essence with respect to the Acquired Company’s obligations under this
Agreement.

 

10

 

7.7                                 No
Third Party Beneficiaries. Except for the provisions of Article II,
this Agreement is not intended to confer upon any person other than the parties
hereto any rights or remedies hereunder.

 

[Remainder of page intentionally left blank]

 

11

 

IN WITNESS WHEREOF, each
of the parties hereto has executed and delivered this Agreement, or has caused
this Agreement to be executed and delivered on its behalf, as of the date first
set forth above.

 

 

	
   

  	
  KITE REALTY
  GROUP TRUST

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ JOHN A. KITE

  	
   

  
	
   

  	
   

  	
  Name:

  	
  John A. Kite

  
	
   

  	
   

  	
  Title:

  	
  President and
  Chief Executive

  Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  KRG DEVELOPMENT,
  LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  KITE REALTY
  GROUP TRUST,

  
	
   

  	
   

  	
  its Sole Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ JOHN A. KITE

  	
   

  
	
   

  	
   

  	
  Name:

  	
  John A. Kite

  
	
   

  	
   

  	
  Title:

  	
  President and
  Chief Executive

  Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  KITE DEVELOPMENT
  CORPORATION

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ JOHN A. KITE

  	
   

  
	
   

  	
   

  	
  Name:

  	
  John A. Kite

  
	
   

  	
   

  	
  Title:

  	
  Authorized
  Representative

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  For purposes of
  Section 3.8 only:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  /s/ ALVIN E.
  KITE, JR.

  	
   

  
	
   

  	
  Alvin E. Kite,
  Jr.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  /s/ JOHN A. KITE

  	
   

  
	
   

  	
  John A. Kite

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  /s/ PAUL W. KITE

  	
   

  
	
   

  	
  Paul W. Kite

  
						

 

12

 

SCHEDULES TO THE AGREEMENT AND PLAN OF MERGER*

 

Schedule A           Common Stock Ownership

 

 

*              The registrant agrees to furnish,
supplementally, a copy of omitted Schedule A upon request.

 

13

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