A rotund sailor with a taste for his drink, the 'Shark Killer'.
Day 1, at night : Visit Kyte in his house at the pier, where you first arrived on the island. His house has a boat on top of it, so it should be easy to find. You'll go through a scene with him and play a new song. When he asks you to drink his Shark Killer, choose to drink it.
Day 2, at morning : Revisit Kyte at the pier and talk to him. He'll join your party and a scripted fight will start. Next take him to the Palace and enter it from the small door at the east side. A fight against a time demon will start. After that Kyte will awaken from the spell of time and join you.