INLAND REAL ESTATE CORP
REGISTRATION RIGHTS AGREEMENT, DATED 7/1/00
<DOCUMENT>
<TYPE>EX-10.5
<SEQUENCE>7
<FILENAME>ex10-5.txt
<DESCRIPTION>REGISTRATION RIGHTS AGREEMENT, DATED 7/1/00
<TEXT>

<PAGE>   1
Exhibit 10.5
                          REGISTRATION RIGHTS AGREEMENT


     This Registration Rights Agreement (the "AGREEMENT") is made and entered
into effective as of the 1st day of July, 2000, by and between Inland Real
Estate Corporation, a Maryland business trust (the "COMPANY"), and Inland Real
Estate Investment Corporation, a Maryland corporation ("IREIC") and The Inland
Property Management Group, Inc., a Maryland corporation ("TIPMG" each of IREIC
and TIPMG sometimes being hereinafter referred to as a "SHAREHOLDER" and
collectively the "SHAREHOLDERS").

                              W I T N E S S E T H:

     WHEREAS, pursuant to that certain Agreement and Plan of Merger, dated March
7, 2000 (the "MERGER AGREEMENT"), the Company acquired from IREIC all of the
outstanding equity securities of Inland Real Estate Advisory Services, Inc. for
a total of 2,652,683 shares of common stock, par value $.01 per share, of the
Company (the "COMMON STOCK") and the Company acquired from TIPMG all of the
outstanding equity securities of Inland Commercial Property Management, Inc. for
a total of 3,529,135 shares of Common Stock.

     WHEREAS, pursuant to the Merger Agreement, the Shareholders are being
granted registration rights with respect to their shares of Common Stock.

     NOW THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the parties hereto agree as follows:

     1. (a) Piggyback Registration. Except with respect to any Joliet Commons
Registration Statement (as hereinafter defined), if the Company shall file a
registration statement (other than a registration statement on Form S-4, Form
S-8, or any successor form) with the Securities and Exchange Commission (the
"COMMISSION") while any Registrable Securities (as hereinafter defined) are
outstanding, the Company shall give all holders of any Registrable Securities
(the "ELIGIBLE HOLDERS") at least 30 days' prior written notice of the filing of
such registration statement. If requested by an Eligible Holder in writing
within 20 days after receipt of any such notice, the Company shall, at the
Company's sole expense (other than the fees and disbursements of counsel for the
Eligible Holders, and the underwriting discounts, if any, payable in respect of
the Registrable Securities sold by any Eligible Holder), register all or, at
each Eligible Holder's option, any portion of the Registrable Securities of any
Eligible Holders who shall have made such request, concurrently with the
registration of such other securities, all to the extent requisite to permit the
public offering and sale of the Registrable Securities through the facilities of
all appropriate securities exchanges, if any, on which the Company's Common
Stock is being sold or on the over-the-counter market, and will use its best
efforts through its officers, directors, auditors, and counsel to cause such
registration statement to become effective as promptly as practicable.
Notwithstanding the foregoing, if the managing underwriter of any such offering
shall advise the Company in writing that, in its opinion, the distribution of
all or a portion of the Registrable Securities requested to be included in the
registration concurrently with the securities being registered by the Company
and the securities


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of other holders of Company securities would materially adversely affect the
distribution of such securities by the Company for its own account, the Company
will include in such registration first, the securities that the Company
proposes to sell, second, the Registrable Securities requested to be included in
such registration and other securities requested to be included in such
registration by holders who have registration rights, pro rata among the holders
of such Registrable Securities and such other securities on the basis of the
number of shares which are owned by such holders, and third, other securities
requested to be included in such registration. As used herein, "REGISTRABLE
SECURITIES" shall mean the shares of Common Stock which were issued pursuant to
the Merger Agreement and which have not been previously sold to the public
pursuant to a registration statement or Rule 144 promulgated under the
Securities Act of 1933, as amended (the "SECURITIES ACT"). Also as used herein,
"JOLIET COMMONS REGISTRATION STATEMENT" shall mean a registration statement
filed pursuant to Article 2 of that certain Registration Rights Agreement, dated
September 30, 1998, by and between the Company and B.I.J. Limited Partnership.

        (b) Demand Registration. If at any time following the earlier of: (i)
the six month anniversary of a Listing Event (as hereinafter defined); (ii) a
Change in Control (as hereinafter defined); or (iii) the fourteen (14) month
anniversary of the date of this Agreement provided that neither a Listing Event
nor a Change in Control has occurred, the Company shall receive a written
request from Eligible Holders who in the aggregate own at least 50% of the total
number of shares of Common Stock then included in the Registrable Securities
(the "Majority Holders"), to register the sale of all or part of such
Registrable Securities, the Company shall, as promptly as practicable, and in
any event not later than 45 days after such request, at the Company's sole cost
and expense (other than the fees and disbursements of counsel for the Eligible
Holders, and the underwriting discounts if any, payable in respect of the
Registrable Securities sold by the Eligible Holders), prepare and file with the
Commission a registration statement on Form S-3 covering the resale of all of
the Registrable Securities; provided, however, the Company shall only be
obligated to file one such registration statement. Within three business days
after receiving any request contemplated by this Section 1(b), the Company shall
give written notice to all the other Eligible Holders, advising each of them
that the Company is proceeding with such registration and offering to include
therein all or any portion of any such other Eligible Holder's Registrable
Securities, provided that the Company receives a written request to do so from
such Eligible Holder within 30 days after receipt by him or it of the Company's
notice. In the event that Form S-3 is unavailable for such a registration, the
Company shall use such other form as is available for such a registration,
subject to the provisions below. The Company shall use its best efforts to have
the registration statement declared effective within ninety (90) days of its
filing. In the event that Form S-3 is not available for any registration of
Registrable Securities hereunder, the Company shall (A) register the sale of the
Registrable Securities on another appropriate form and (B) undertake to register
the Registrable Securities on Form S-3 as soon as such form is available,
provided that the Company shall maintain the effectiveness of the registration
statement then in effect until such time as a registration statement on Form S-3
covering the Registrable Securities has been declared effective by the
Commission. As used herein, "LISTING EVENT" shall mean an event by which the
Company lists the shares of its $0.01 par value common stock on a national
securities exchange or designates its shares for quotation on the NASDAQ
National Market System. Additionally, as used herein "CHANGE IN CONTROL" shall
mean

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(X) the approval by the Company's stockholders of (A) a merger or consolidation
of the Company with an unaffiliated third party where the Company is not the
surviving entity, or (B) the sale of substantially all of the assets of the
Company, or (Y) the acquisition of not less than twenty five percent (25%) of
the equity voting securities of the Company by a person, or group of persons
acting in concert, not affiliated with The Inland Group, Inc.

        (c) In the event of a registration pursuant to the provisions of this
Section 1, the Company shall use its best efforts to cause the Registrable
Securities so registered to be registered or qualified for sale under the
securities or blue sky laws of such jurisdictions as the Eligible Holder or such
holders may reasonably request; provided, however, that the Company shall not be
required to qualify to do business in any state by reason of this Section 1(c)
in which it is not otherwise required to qualify to do business.

        (d) The Company shall keep effective any registration or qualification
contemplated by this Section 1 and shall from time to time amend or supplement
each applicable registration statement, preliminary prospectus, final
prospectus, application, document and communication for such period of time as
shall be required to permit the Eligible Holders to complete the offer and sale
of the Registrable Securities covered thereby. The Company shall keep the
registration statement referred to in Section 1(b) hereof effective at all times
until the earlier of: (i) the date as of which the Shareholders may sell all of
the Registrable Securities without restriction pursuant to Rule 144(k)
promulgated under the Securities Act (or successor thereto); or (ii) the date on
which the Shareholders shall have sold to the public all the Registrable
Securities.

        (e) In the event of a registration pursuant to the provisions of this
Section 1, the Company shall furnish to each Eligible Holder such number of
copies of the registration statement and of each amendment and supplement
thereto (in each case, including all exhibits), such reasonable number of copies
of each prospectus contained in such registration statement and each supplement
or amendment thereto (including each preliminary prospectus), all of which shall
conform to the requirements of the Securities Act and the rules and regulations
thereunder, and such other documents, as any Eligible Holder may reasonably
request to facilitate the disposition of the Registrable Securities included in
such registration.

        (f) In the event of a registration pursuant to the provisions of this
Section 1, the Company shall furnish each Eligible Holder of any Registrable
Securities so registered with an opinion of its counsel (reasonably acceptable
to the Eligible Holders) to the effect that (i) the registration statement has
become effective under the Securities Act and no order suspending the
effectiveness of the registration statement, preventing or suspending the use of
the registration statement, any preliminary prospectus, any final prospectus, or
any amendment or supplement thereto has been issued, nor has the Commission or
any securities or blue sky authority of any jurisdiction instituted or
threatened to institute any proceedings with respect to such an order, (ii) the
registration statement and each prospectus forming a part thereof (including
each preliminary prospectus), and any amendment or supplement thereto, comply as
to form with the Securities Act and the rules and regulations thereunder, and
(iii) such counsel has no knowledge of any material misstatement or

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omission in such registration statement or any prospectus, as amended or
supplemented. Such opinion shall also state the jurisdictions in which the
Registrable Securities have been registered or qualified for sale pursuant to
the provisions of Section 1(c).

        (g) The Company agrees that until all the Registrable Securities have
been sold under a registration statement or pursuant to Rule 144 under the
Securities Act, it shall keep current in filing all reports, statements and
other materials required to be filed with the Commission to permit holders of
the Registrable Securities to sell such securities under Rule 144. The Company
shall furnish to each holder of Registrable Securities, promptly upon request:
(i) any information as may be reasonably requested to permit such holders to
sell such securities pursuant to Rule 144 without registration, including a
written statement by the Company that is has complied with the reporting
requirements of the Securities Exchange Act of 1934 necessary for such holder to
sell such securities pursuant to Rule 144; and (ii) a copy of the most recent
annual or quarterly report of the Company and such other reports and documents
so filed by the Company.

        (h) The Company shall notify the Eligible Holders of the Registrable
Securities promptly when such registration statement has become effective or a
supplement to any prospectus forming a part of such registration statement has
been filed.

        (i) The Company shall promptly notify the Eligible Holders of the
Registrable Securities at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, would include an untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing, and shall promptly prepare and furnish to them such number of copies
of a supplement to or an amendment of such prospectus as may be necessary so
that, as thereafter delivered to the purchasers of such Registrable Securities,
such prospectus shall not include an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances under which
they were made.

        (j) If requested by the underwriter for any underwritten offering of
Registrable Securities on behalf of an Eligible Holder of Registrable Securities
pursuant to a registration requested under Section 1(a), the Company and such
Eligible Holder of Registrable Securities will enter into an underwriting
agreement with such underwriter for such offering, which shall be reasonably
satisfactory in substance and form to the Company and the Company's counsel,
such Eligible Holder of Registrable Securities and the underwriter, and such
agreement shall contain such representations and warranties by the Company and
such Eligible Holder of Registrable Securities (provided, however, that the
representations and warranties required of an Eligible Holder shall only relate
to a description of such Eligible Holder and its holding of Company capital
stock) and such other terms and provisions as are customarily contained in an
underwriting agreement with respect to secondary distributions solely by selling
stockholders, including, without limitation, indemnities substantially to the
effect and to the extent provided in Section 2 hereof.

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        (k) Following the effective date of any registration statement filed
pursuant to this Agreement and subject to the limitations set forth herein, the
Company shall be entitled, from time to time, to notify (the "BLACKOUT NOTICE")
the Eligible Holders to discontinue offers or sales of shares pursuant to such
registration statement for Registrable Securities for the period of time stated
in the notice (the "BLACKOUT PERIOD"), if the Company determines, in its
reasonable business judgment, that the disclosure required in connection with
the offers and sales of the Registrable Securities could materially damage the
Company's ability to successfully complete an acquisition, corporate
reorganization, securities offering or other voluntary transaction undertaken by
the Company (which information the Company would not be required to disclose at
such time other than in connection with the Eligible Holders' registration
statement) that is material to the Company. No Blackout Period shall extend
longer than ninety (90) consecutive calendar days and the Company shall use its
best efforts to not impose Blackout Periods which, in the aggregate, exceed
ninety (90) days in any twelve (12) month period.

     2. Indemnification. (a) Subject to the conditions set forth below, the
Company agrees to indemnify and hold harmless each Eligible Holder, its
officers, directors, partners, employees, agents, and counsel, and each person,
if any, who controls any such person within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Securities Exchange Act of 1934, as
amended (the "EXCHANGE ACT"), from and against any and all loss, liability,
charge, claim, damage, and expense whatsoever (which shall include, for all
purposes of this Section 2, but not be limited to, reasonable attorneys' fees
and any and all reasonable expenses whatsoever incurred in investigating,
preparing, or defending against any litigation, commenced or threatened, or any
claim whatsoever, and any and all amounts paid in settlement of any claim or
litigation), as and when incurred, arising out of, based upon, or in connection
with (i) any untrue statement or alleged untrue statement of a material fact
contained (A) in any registration statement, preliminary prospectus, or final
prospectus (as from time to time amended and supplemented), or any amendment or
supplement thereto, relating to the sale of any of the Registrable Securities or
(B) in any application or other document or communication (in this Section 2
collectively called an "APPLICATION") executed by or on behalf of the Company or
based upon written information furnished by or on behalf of the Company filed in
any jurisdiction in order to register or qualify any of the Registrable
Securities under the securities or blue sky laws thereof or filed with the
Commission or any securities exchange; or any omission or alleged omission to
state a material fact required to be stated therein or necessary to make the
statements made therein not misleading, unless (x) such statement or omission
was made in reliance upon and in conformity with written information furnished
to the Company with respect to such Eligible Holder by or on behalf of such
person expressly for inclusion in any registration statement, preliminary
prospectus, or final prospectus, or any amendment or supplement thereto, or in
any application, as the case may be, or (y) such loss, liability, charge, claim,
damage or expense arises out of such Eligible Holder's failure to comply with
the terms and provisions of this Agreement, or (ii) any breach of any
representation, warranty, covenant, or agreement of the Company contained in
this Agreement. The foregoing agreement to indemnify shall be in addition to any
liability the Company may otherwise have, including liabilities arising under
this Agreement.


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     If any action is brought against any Eligible Holder or any of its
officers, directors, partners, employees, agents, or counsel, or any controlling
persons of such person (an "INDEMNIFIED PARTY") in respect of which indemnity
may be sought against the Company pursuant to the foregoing paragraph, such
indemnified party or parties shall promptly notify the Company in writing of the
institution of such action (but the failure so to notify shall not relieve the
Company from any liability other than pursuant to this Section 2(a)) and the
Company shall promptly assume the defense of such action, including the
employment of counsel (reasonably satisfactory to such indemnified party or
parties), provided that the indemnified party shall have the right to employ its
or their own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of such indemnified party or parties unless the
employment of such counsel shall have been authorized in writing by the Company
in connection with the defense of such action or the Company shall not have
promptly employed counsel reasonably satisfactory to such indemnified party or
parties, or such indemnified party or parties shall have reasonably concluded
that there may be one or more legal defenses available to it or them or to other
indemnified parties which are different from or additional to those available to
the Company, in any of which events such fees and expenses shall be borne by the
Company and the Company shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties. Anything in this Section 2
to the contrary notwithstanding, the Company shall not be liable for any
settlement of any such claim or action effected without its written consent,
which shall not be unreasonably withheld. The Company shall not, without the
prior written consent of each indemnified party that is not released as
described in this sentence, settle or compromise any action, or permit a default
or consent to the entry of judgment in or otherwise seek to terminate any
pending or threatened action, in respect of which indemnity may be sought
hereunder (whether or not any indemnified party is a party thereto), unless such
settlement, compromise, consent, or termination includes an unconditional
release of each indemnified party from all liability in respect of such action.
The Company agrees promptly to notify Eligible Holders of the commencement of
any litigation or proceedings against the Company or any of it officers or
directors in connection with the sale of any Registrable Securities or any
preliminary prospectus, prospectus, registration statement, or amendment or
supplement thereto, or any application relating to any sale of any Registrable
Securities.

        (b) Each Eligible Holder agrees to indemnify and hold harmless the
Company, each director of the Company, each officer of the Company who shall
have signed any registration statement covering Registrable Securities held by
such Eligible Holder, each other person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange
Act, and its or their respective counsel, to the same extent as the foregoing
indemnity from the Company to such Eligible Holder in Section 2(a), but only
with respect to statements or omissions, if any, made in any registration
statement, preliminary prospectus, or final prospectus (as from time to time
amended and supplemented), or any amendment or supplement thereto, or in any
application, in reliance upon and in conformity with written information
furnished to the Company with respect to such Eligible Holder by or on behalf of
such Eligible Holder, expressly for inclusion in any such registration
statement, preliminary prospectus, or final prospectus, or any amendment or
supplement thereto, or in any application, as the case may be. If any action
shall be brought against the Company or any other person so indemnified based on
any such registration statement,

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preliminary prospectus, or final prospectus or any amendment or supplement
thereto, or in any application, and in respect of which indemnity may be sought
against such Eligible Holder pursuant to this Section 2(b), such Eligible Holder
shall have the rights and duties given to the Company, and the Company and each
other person so indemnified shall have the rights and duties given to the
indemnified parties, by the provisions of Section 2(a).

        (c) To provide for just and equitable contribution, if (i) an
indemnified party makes a claim for indemnification pursuant to Section 2(a) or
2(b) (subject to the limitations thereof) but it is found in a final judicial
determination, not subject to further appeal, that such indemnification may not
be enforced in such case, even though this Agreement expressly provides for
indemnification in such cases, or (ii) any indemnified or indemnifying party
seeks contribution under the Securities Act, the Exchange Act or otherwise, then
the Company (including for this purpose any contribution made by or on behalf of
any director of the Company, any officer of the Company who signed any such
registration statement, any controlling person of the Company, and its or their
respective counsel), as one entity, and the Eligible Holders of the Registrable
Securities, included in such registration in the aggregate (including for this
purpose any contribution by or on behalf of an indemnified party), as a second
entity, shall contribute to the losses, liabilities, claims, damages, and
expenses whatsoever to which any of them may be subject, on the basis of
relevant equitable considerations such as the relative fault of the Company and
such Eligible Holders in connection with the facts which resulted in such
losses, liabilities, claims, damages, and expenses. The relative fault, in the
case of an untrue statement, alleged untrue statement, omission, or alleged
omission shall be determined by, among other things, whether such statement,
alleged statement, omission, or alleged omission relates to information supplied
by the Company or by such Eligible Holders, and the parties' relative intent,
knowledge, access to information, and opportunity to correct or prevent such
statement, alleged statement, omission, or alleged omission. The Company and
Eligible Holders agree that it would be unjust and inequitable if the respective
obligations of the Company and the Eligible Holders for contribution were
determined by pro rata or per capita allocation of the aggregate losses,
liabilities, claims, damages, and expenses (even if each Eligible Holder and the
other indemnified parties were treated as one entity for such purpose) or by any
other method of allocation that does not reflect the equitable considerations
referred to in this Section 2(c). In no case shall any Eligible Holder be
responsible for a portion of the contribution obligation imposed on all Eligible
Holders in excess of its pro rata share based on the number of shares of Common
Stock owned by him and included in such registration as compared to the number
of shares of Common Stock owned by all Eligible Holders and included in such
registration. No person guilty of a fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who is not guilty of such fraudulent
misrepresentation. For purposes of this Section 2(c), each person, if any, who
controls any Eligible Holder within the meaning of Section 15 of the Securities
Act or Section 20(a) of the Exchange Act and each officer, director, partner,
employee, agent, and counsel of Eligible Holder or control person shall have the
same rights to contribution as such Eligible Holder or control person and each
person, if any, who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Exchange Act, each officer of the Company
who shall have signed any such registration statement, each director of the
Company, and its or their respective counsel shall have the same rights to
contribution as the Company, subject in each case to

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the provisions of this Section 2(c). Anything in this Section 2(c) to the
contrary notwithstanding, no party shall be liable for contribution with respect
to the settlement of any claim or action effected without its written consent.
This Section 2(c) is intended to supersede any right to contribution under the
Securities Act, the Exchange Act or otherwise.

        (d) In no event and under no circumstances shall an Eligible Holder
provide indemnification or contribution payments in excess of the net proceeds
received by such Eligible Holder as a result of the sale of the Registrable
Securities pursuant to the applicable Registration Statement.

     3. Registration Procedures. Whenever the holders of Registrable Securities
have requested that any Registrable Securities be registered pursuant to this
Agreement, the Company will use its reasonable best efforts to effect the
registration and sale of such Registrable Securities in accordance with the
intended method of disposition thereof and, pursuant thereto, the Company will
as expeditiously as possible:

        (a) prepare and file with the Commission a registration statement with
respect to such Registrable Securities and use its reasonable best efforts to
cause such registration statement to become effective (provided that before
filing a registration statement or prospectus, or any amendments or supplements
thereto, the Company will furnish copies of all such documents proposed to be
filed to the counsel or counsels for the sellers of the Registrable Securities
covered by such registration statement and obtain such counsels' approval of
such filing, which approval shall not be unreasonably withheld or delayed);

        (b) prepare and file with the Commission such amendments and supplements
to such registration statement and the prospectus(es) used in connection
therewith as may be necessary to keep such registration statement effective for
a period required by this Agreement and comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
registration statement during such period in accordance with the intended
methods of disposition by the sellers thereof set forth in such registration
statement;

        (c) cause all such Registrable Securities to be listed on each
securities exchange on which similar securities issued by the Company are then
listed;

        (d) provide a transfer agent and registrar for all such Registrable
Securities not later than the effective date of such registration statement;

        (e) in the event Eligible Holders who hold a majority of the Registrable
Securities select underwriters to sell Registrable Securities, the Company shall
enter into and perform its obligations under such customary agreements
(including underwriting agreements in customary form) and take all such other
customary and commercially reasonable actions as the holders of a majority of
the Registrable Securities being sold or the underwriters reasonably request in
order to expedite

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or facilitate the disposition of such Registrable Securities (including, but not
limited to, effecting a stock split or a combination of shares);

        (f) if requested by an Eligible Holder or any underwriter selected by
Eligible Holders who hold a majority of the Registrable Securities, the Company
shall: (i) immediately incorporate in a prospectus supplement or post-effective
amendment such information as such Eligible Holders or underwriter requests to
be included therein relating to the sale and distribution of Registrable
Securities, including, but not limited to, information with respect to the
number of Registrable Securities being offered or sold, the purchase price being
paid therefor and any other terms of the offering of the Registrable Securities;
(ii) make all required filings of such prospectus supplement or post-effective
amendment as soon as notified of the matters to be incorporated in such
prospectus supplement or post-effective amendment; and (iii) supplement or make
amendments to any Registration Statement if requested by such holders of
Registrable Securities or underwriter;

        (g) make available for inspection by any seller of Registrable
Securities, any underwriter participating in any disposition pursuant to such
registration statement, and any attorney, accountant or other agent retained by
any such seller or underwriter, all financial and other records, pertinent
corporate documents and properties of the Company, and cause the Company's
officers, directors, employees and independent accountants to supply all
information reasonably requested by any such seller, underwriter, attorney,
accountant or agent in connection with such registration statement; and

        (h) advise each seller of such Registrable Securities, promptly after it
shall receive notice or obtain knowledge thereof, of the issuance of any stop
order by the Commission suspending the effectiveness of such registration
statement or the initiation or threatening of any proceeding for such purpose
and promptly use all commercially reasonable efforts to prevent the issuance of
any stop order or to obtain its withdrawal if such stop order should be issued.

    4.  Miscellaneous.

        (a) Remedies. In the event of a breach by the Company of its obligations
under this Agreement, each Shareholder, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement.

        (b) Agreements and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
unless such amendment, modification or supplement is in writing and signed by
the parties hereto.

        (c) Notices. All notices and other communications provided for or
permitted hereunder shall be made in accordance with the provisions of the
Merger Agreement.


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        (d) Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors and assigns of each of the parties, including
without limitation and without the need for an express assignment, subsequent
holders of the Registrable Securities subject to the terms hereof.

        (e) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

        (f) Headings. The headings in this Agreement are for convenience of
references only and shall not limit or otherwise affect the meaning hereof.

        (g) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois without reference to its
conflicts of law provisions.

        (h) Severability. In the event that any one or more of the provisions
contained herein, or the application hereof in any circumstance is held invalid,
illegal or unenforceable, the validity, legality and enforceability of any such
provisions contained herein shall not be affected or impaired thereby.

        (i) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and intended to be a complete and exclusive
statement of this agreement and understanding of the parties hereto in respect
of the subject matter contained herein. There are no restrictions, promises
warranties or undertakings, other than those set forth or referred to herein,
concerning the registration rights granted by the Company pursuant to this
Agreement.



        [Rest of Page Intentionally Left Blank, Signature Page to Follow]

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        IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the date first written above.

                                   INLAND REAL ESTATE CORPORATION


                                   By:     /s/ Robert D. Parks
                                       -----------------------------------------
                                   Title:   President
                                         ---------------------------------------

                                   SHAREHOLDERS:


                                   INLAND REAL ESTATE INVESTMENT
                                   CORPORATION


                                   By:   /s/ Brenda Gail Gujral
                                      ------------------------------------------
                                   Title: President
                                         ---------------------------------------

                                   THE INLAND PROPERTY
                                   MANAGEMENT GROUP, INC.


                                   By:   /s/ Norbert Treonis
                                      ------------------------------------------
                                   Title: President
                                         ---------------------------------------




                                       11

</TEXT>
</DOCUMENT>
