LIMITED LIABILITY COMPANY AGREEMENT

OF

IRC-IREX VENTURE, L.L.C.

SEPTEMBER 5, 2006

TABLE OF CONTENTS

Page

ARTICLE I DEFINITIONS

ARTICLE II FORMATION

2.1

Organization

2.2

Name

2.3

Term

2.4

Registered Agent and Office

2.5

Principal Office

2.6

Foreign Qualification

ARTICLE III ACCOUNTING AND RECORDS

3.1

Records to be Maintained

3.2

Information and Accounting to Members

ARTICLE IV BUSINESS TRANSACTIONS

4.1

Nature of Business

4.2

Location and Submission of Target Properties

4.3

Mutual Agreement re Target Property Proposals

4.4

Formation of Venture Sub

4.5

Equity Advances

4.6

Reimbursement of Syndication Costs

4.7

Assignment of Rights to Acquire Target Property

4.8

Management and Service Provider Agreements

4.9

Service Provider and Other Business Transactions

4.10

Discontinued Venture

4.11

Carve Out Guaranties

ARTICLE V AMENDMENTS TO CERTIFICATE AND AGREEMENT

5.1

Certificate  Amendments

5.2

Agreement Amendments

ARTICLE VI RIGHTS AND DUTIES OF MEMBERS

6.1

Meetings and Notice

6.2

Informal Action by Members

6.3

No Liability of Members

6.4

Contributing Member Decisions

6.5

Lack of Authority

6.6

Conflicts of Interest

6.7

Representations and Warranties

ARTICLE VII RIGHTS AND DUTIES OF MANAGER

7.1

Management

7.2

Manager

7.3

Power to Bind the Company

7.4

Fees and Compensation

7.5

Standard of Care

7.6

Officers

7.7

Matters Requiring Member Consent

7.8

REIT Provisions

ARTICLE VIII INDEMNIFICATION

8.1

Indemnification by Venture Corp. and IRC of IREX Indemnified Parties

8.2

Indemnification by IREX of IRC Indemnified Parties

8.3

Other Indemnification Obligations

ARTICLE IX CONTRIBUTIONS AND CAPITAL ACCOUNTS

9.1

Initial Contributions

9.2

Additional Capital Contributions From Existing Members

ARTICLE X DISTRIBUTIONS

ARTICLE XI ALLOCATIONS AND TAXES

11.1

Allocation of Profits and Losses

11.2

Elections

11.3

Tax Matters Partner

11.4

Method of Accounting

11.5

Returns and Other Elections

ARTICLE XII DISPOSITION OF MEMBERSHIP INTERESTS

ARTICLE XIII TERMINATION OF A MEMBER

13.1

Termination

13.2

Effect of Termination

ARTICLE XIV DISSOLUTION AND WINDING UP

14.1

Dissolution

14.2

Effect of Dissolution

14.3

Distribution of Assets upon Dissolution

14.4

Winding Up and Articles of Dissolution

ARTICLE XV MISCELLANEOUS PROVISIONS

15.1

Notices

15.2

Entire Agreement

15.3

Construction

15.4

Expenses

15.5

Headings

15.6

No Partnership Intended for Nontax Purposes

15.7

Rights of Creditors and Third Parties Under Agreement

15.8

Application of Delaware Law

15.9

Counterparts

15.10

No Waiver

15.11

Severability

15.12

Benefit

i

Exhibit A

Member Information

Exhibit B

Form of Venture Sub Formation Documents

Exhibit C

Form of Promissory Note

Exhibit D

Form of Management Agreement with IREX

Exhibit E

Form of Property Management Sub-Contact with ICPMC

Exhibit F

Form of Dealer Manager Agreement with Inland Securities Corporation

ii

LIMITED LIABILITY COMPANY AGREEMENT

OF

IRC-IREX VENTURE, L.L.C.

(a Delaware limited liability company)

THIS LIMITED LIABILITY COMPANY AGREEMENT of IRC-IREX VENTURE, L.L.C., a Delaware
limited liability company (the “Company”), is entered into and shall be
effective as of September 5, 2006, by and between Inland Real Estate Exchange
Corporation (“IREX”), a Delaware corporation, and Inland Venture Corporation
(“Venture Corp.”), a Delaware corporation.  Certain capitalized terms used
herein are defined in Article I.

NOW, THEREFORE, the parties hereto agree as follows:

ARTICLE I
DEFINITIONS

Unless otherwise specified herein, the following terms shall have the following
meanings:

“1031 Program” shall mean the offering for sale, pursuant to Regulation D under
the Securities Act of 1933, as amended, of interests in real estate, structured
as (a) tenant-in-common interests, (b) beneficial interests in a Delaware
Statutory Trust or (c) a custom program for a single investor, in each case for
investors wishing to complete a tax-deferred exchange of real estate pursuant to
Section 1031 of the Code or for cash investors who desire to position their
investments for future tax deferred exchanges.

“Abandoned Syndication” shall mean a syndication of a 1031 Program that is not
undertaken or is withdrawn from the market by the Venture Sub.

“Act” shall mean the Delaware Limited Liability Company Act, as amended from
time to time.

“Additional Capital Contribution” shall mean a Capital Contribution other than
the Initial Capital Contribution.

“Additional Return” shall mean a preferred return to be paid if an Equity
Advance or portion thereof (other than the Retained Percentage Equity Amount)
remains unpaid on the Applicable Additional Return Date. The Additional Return
shall be calculated at the rate of 9 percent per annum on the portion of the
Equity Advance (other than the Retained Percentage Equity Amount) that remains
outstanding from time to time after the Applicable Additional Return Date,
reduced by the Operating Proceeds paid to the Contributing Member under Section
4.5 between the Applicable Additional Return Date and the date Additional Return
is being calculated. Notwithstanding the foregoing, (i) no Additional Return
shall accrue and (ii) the running of the four and six month periods specified
under the definition of Applicable Additional Return Date shall be suspended, in
each case during the time the Target Property is subject to any Adverse Target
Property Condition.

“Adverse Target Property Condition” shall mean a condition with respect to a
Target Property which (i) was not known by IREX at the time the Equity Advance
for such Target Property was funded and (ii) delays the 1031 Program from being
marketed or causes a suspension in the marketing of the 1031 Program. For
purposes of illustration, material environmental conditions, and material tenant
defaults or abandonments not existing at the time the Equity Advance was funded,
shall be deemed Adverse Target Property Conditions, but general changes in
market conditions will not constitute an Adverse Target Property Condition.

“Affiliate” shall mean any entity that directly or indirectly through one or
more intermediaries controls, is controlled by, or is under common control with
a party hereto.  For purposes of this definition, “control” (including, with
correlative meanings, the terms “controlled by” and “under common control with”)
shall mean the ownership or control of securities possessing more than 50
percent of the voting power of all outstanding voting securities of an entity or
the power to otherwise direct or cause the direction of the management and
policies of the entity, whether through the ownership of voting stock or similar
rights.

“Agreement” shall mean this Limited Liability Company Agreement, as amended from
time to time.

“Applicable Additional Return Date” shall mean with respect to each Equity
Advance, the six month anniversary of the date such Equity Advance was funded;
provided, however, if the Applicable Private Placement Memorandum is not
completed by the four month anniversary of such funding date, the Applicable
Additional Return Date shall begin on such four month anniversary date.

“Applicable Private Placement Memorandum” shall mean, with respect to a
particular Equity Advance, the private placement memorandum through which a
Venture Sub offers interests in the Target Property, the acquisition of which
was funded (in part) through such Equity Advance.

“Bankruptcy Event” shall mean with respect to any Person: an assignment by such
Person for the benefit of creditors or an admission in writing by such Person of
an inability to pay its debts generally as they become due; the entry of an
order, judgment or decree adjudicating such Person bankrupt or insolvent; the
petition or application by such Person to any tribunal for the appointment of a
custodian, trustee, receiver or liquidator of such Person or of any substantial
part of its assets; the commencement of any proceeding (or the entry of any
order for relief) with respect to such Person or its debts under any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, dissolution or
liquidation law of any jurisdiction; or the filing of any such petition or
application or the commencement of any such proceeding against such Person and
either (i) such Person by any act indicates its approval thereof, consent
thereto or acquiescence therein or (ii) such petition, application or proceeding
is not dismissed within 60 days.

“Business Day” shall mean any day other than Saturday, Sunday or any legal
federal or Illinois State holiday.

“Capital Account” shall mean the Capital Account established and maintained for
each Member in accordance with the following provisions:

(a)

to each Member’s Capital Account there shall be credited the Member’s Capital
Contributions and the Member’s distributive share of Profits; and

(b)

to each Member’s Capital Account there shall be debited the amount of cash and
the fair market value of any other property distributed to the Member and the
Member’s distributive share of Losses.

“Capital Contribution” shall mean, with respect to any Member, the amount of
money and the fair market value of any Property (other than money) contributed
to the Company.

“Carve-Out Guaranty” shall mean a Target Property lender required guaranty of
carve-out obligations (in particular, the various non-recourse exceptions
contained in the subject debt) in connection with the financing of any Venture
Sub Target Property.

“Certificate” shall mean the Certificate of Formation of the Company, as amended
from time to time.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to
time.

“Contributing Member” shall mean Venture Corp.

“Contributing Member Decisions” shall have the meaning set forth in Section 6.4
of this Agreement.

“Damages” means any and all damages, losses, liabilities, obligations,
penalties, assessments, dues, fines, amounts paid in settlement, judgments,
costs and expenses (including attorneys’ fees and expenses) of any nature.

“DST Interest” shall mean a beneficial interest in a Delaware Statutory Trust.

“Equity Advance” shall mean a bridge loan extended by Venture Corp. to the
Company, the proceeds of which will thereupon be contributed by the Company to a
Venture Sub to fund (in part) the acquisition of a Target Property.

“Exit Sale Proceeds” shall mean the net sale proceeds realized by Venture Sub
from the disposition of its Target Property, relating to its Retained Percentage
and other ownership interests in the Target Property.

“Initial Capital Contribution” shall mean the initial Capital Contribution made
by each of the Members as described in Section 9.1.

“ICPMC” shall mean Inland Commercial Property Management Corporation, a
wholly-owned subsidiary of IRC.

“IRC” shall mean Inland Real Estate Corporation, a Maryland corporation.

“IREX” shall have the meaning set forth in the preamble of this Agreement.

“Investor Net Sales Proceeds” means the total proceeds received by a Venture Sub
from the sale of a TIC or DST Interest, reduced by that portion of the proceeds
attributable to: (i) reserves, (ii) commissions and fees and (iii) third party
expenses (the “Subtractions”), all as set forth in the “Sources and Uses of
Funds” section of the Applicable Private Placement Memorandum.  For the
avoidance of doubt, the Investor Net Sales Proceeds will generally be that
percentage of the total sales price received from an Investor as calculated by
the following fraction:  (x) total interests offered less Subtractions divided
by (y) total interests offered.

“Major Decisions” shall have the meaning set forth in Section 7.7.

“Manager” shall mean the Person selected to manage the affairs of the Company
under Article VII.

“Member” shall mean each person executing this Agreement as a Member.

“Member Consent” shall mean the affirmative vote of both Members.

“Membership Interest” shall mean the interest in the Company entitling its
holder to the benefits provided in this Agreement and the Act, and subjecting
its holder to the obligations provided in this Agreement and the Act.

“Misrepresentation” shall mean any untrue statement of a material fact or
omission of a material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading.

“Operating Proceeds” shall mean a Venture Sub’s share of Target Property cash
flow from property operations, after the payment of: (i) all property and
Venture Sub operating expenses, (ii) debt service and (iii) necessary capital
expenditures and reserves.

“Organization” shall mean a Person other than a natural person, including
without limitation, corporations (both non-profit and other corporations),
partnerships (both limited and general), joint ventures, limited liability
companies, trusts and unincorporated associations.

“Percentage Interest” shall mean (i) in the case of IREX, 50 percent and (ii) in
the case of Venture Corp., 50 percent.

“Person” shall mean any natural person or Organization.

“Principal Office” shall have the meaning set forth in Section 2.5.

“Proceeding” shall mean any judicial or administrative trial, hearing or other
activity, civil, criminal or investigative, the result of which may be that a
court, arbitrator, or governmental agency may enter a judgment, order, decree,
or other determination which, if not appealed and reversed, would be binding
upon the Company, a Member or other Person subject to the jurisdiction of the
court, arbitrator, or governmental agency.

“Profits” and “Losses” shall mean, for each Taxable Year or other period, an
amount equal to the Company’s taxable income or loss for the year or period,
determined in accordance with Code Section 703(a) (for this purpose, all items
of income, gain, loss, or deduction required to be stated separately pursuant to
Code Section 703(a)(1) shall be included in taxable income or loss), with the
following adjustments:

(a)

any income of the Company that is exempt from federal income tax and not
otherwise taken into account in computing Profits or Losses pursuant to this
definition shall be added to taxable income or loss; and

(b)

any expenditure of the Company described in Code Section 705(a)(2)(B) or treated
as Code Section 705(a)(2)(B) expenditures pursuant to Treasury Regulations
Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing
Profits or Losses pursuant to this definition, shall be subtracted from taxable
income or loss.

“Property” shall mean any property, real or personal, tangible or intangible,
excluding cash and cash equivalents of the Company.

“Retained Percentage” shall mean the tenant in common percentage of a Target
Property (or Delaware statutory trust interest) that a first mortgage lender
requires be retained by a Venture Sub and any remaining unsold fractional
interest.

“Retained Percentage Equity Amount” shall mean an amount equal to the value of a
Retained Percentage based on the offering price for an equivalent interest, as
set forth in the Applicable Private Placement Memorandum.

“Secretary of State” shall mean the Secretary of State of Delaware.

“Securities Act” shall mean the Securities Act of 1933, as amended.

“State” shall mean the State of Delaware.

“Syndication Costs” shall mean all out-of-pocket financing, investigation and
syndication costs and expenses incurred in connection with a 1031 Program for a
Target Property.

“Target Property” shall have the meaning set forth in Section 4.2.

“Taxable Year” shall mean the calendar year.

“Taxing Jurisdiction” shall mean any state, local, or foreign government which
collects tax, interest or penalties, however designated, on any Member’s share
of the income or gain attributable to the Company.

“Termination” shall have the meaning set forth in Section 13.1.

“TIC Interest” shall mean a tenant in common interest.

“Transfer” shall mean any sale, assignment, transfer, exchange, mortgage,
pledge, grant, hypothecation or other disposition, absolute or as security or
encumbrance, including dispositions by operation of law.

“Treasury Regulations” shall mean, except where the context indicates otherwise,
the permanent, temporary, proposed, or proposed and temporary regulations of the
Department of the Treasury under the Code as amended from time to time.

“Venture Corp.” shall have the meaning set forth in the preamble of this
Agreement.

“Venture Sub” shall have the meaning set forth in Section 4.3.

“Venture Sub Manager” shall have the meaning set forth in Section 4.3.

“Willful Misconduct” shall mean any material act or omission of or by a Person
that: (i) was committed in bad faith or was the result of active and deliberate
dishonesty of such Person; or (ii) resulted in an improper personal benefit to
such Person in money, property or services; or (iii) in the case of any criminal
matter, the Person committing the act or omission had reasonable cause to
believe that the act or omission was unlawful.

ARTICLE II
FORMATION

2.1

Organization

.  The Company was formed as a Delaware limited liability company by the filing
of the Certificate with the Secretary of State on September 5, 2006.

2.2

Name

.  The name of the Company is “IRC-IREX Venture, L.L.C.” and all business of the
Company shall be conducted under that name or any other name approved by Member
Consent or under any other name adopted as an assumed name, but in any case,
only to the extent permitted by applicable law.

2.3

Term

.  The term of this Agreement shall be perpetual, provided that the Company may
be dissolved and its affairs wound up as provided in this Agreement or mandated
under the Act.

2.4

Registered Agent and Office

.  The registered agent for service of process and the registered office shall
be that Person and location reflected in the Certificate.  The Manager may
change the registered agent or office through appropriate filings with the
Secretary of State.  In the event the registered agent ceases to act for any
reason or the registered office shall change, the Manager shall promptly
designate a replacement registered agent or file a notice of change of address
as the case may be.

2.5

Principal Office

.  The principal office of the Company shall be at 2901 Butterfield Road, Oak
Brook, Illinois 60523, or at such other location as the Manager shall determine
(the “Principal Office”).

2.6

Foreign Qualification

.  The Company shall be qualified to do business in Illinois and such other
states as determined from time to time by the Manager.

ARTICLE III
ACCOUNTING AND RECORDS

3.1

Records to be Maintained

.  The Company shall maintain the following records at the Principal Office:

(a)

a list of the amount of cash and a description and statement of the agreed value
of the other property each Member has contributed or has agreed to contribute in
the future (which information is also reflected on Exhibit A attached hereto)
and the date on which each became a Member;

(b)

a copy of this Agreement and the Certificate, together with any amendments
thereto;

(c)

copies of the Company’s federal, state and local income tax returns and reports,
if any; and

(d)

any financial statements of the Company.

3.2

Information and Accounting to Members

.  Records required to be kept under Section 3.1 may be inspected and copied by
a Member or its legal representative at the request and expense of any Member
during ordinary business hours.

ARTICLE IV
BUSINESS TRANSACTIONS

4.1

Nature of Business

.  The purpose of the Company shall be to facilitate the participation of
Venture Corp. in 1031 Programs for Target Properties made available by Venture
Corp.  The Company may engage in any lawful business permitted by the Act or the
laws of any jurisdiction in which the Company may do business in furtherance of
its purpose.  The Company shall have the authority to do all things necessary or
convenient to accomplish its purpose and operate its business.

4.2

Location and Submission of Target Properties

.  Until the earlier of (i) the 12 month anniversary of the date of this
Agreement and (ii) the consummation of any direct or indirect acquisition of
IREX by IRC (the “Recommendation Period”), Venture Corp. may, in its discretion,
locate and submit for evaluation by IREX, properties that may be suitable for a
1031 Program (individually, a “Target Property” and such submission a “Venture
Proposal”). Each Venture Proposal made by Venture Corp. shall include
information, such as physical characteristics, economic data, proposed
financing, Argus runs, and other relevant data for IREX to determine the
suitability of the Target Property for a 1031 Program. Upon expiration of the
Recommendation Period, the Company shall not consummate or sponsor or otherwise
participate in any additional 1031 Programs, and the period during which Venture
Corp. may locate and submit properties to the Company shall lapse.

4.3

Mutual Agreement re Target Property Proposals

.  Upon completion of its review of each Venture Proposal, IREX shall notify
Venture Corp. as to whether IREX considers the Target Property suitable for a
1031 Program. If IREX determines the Target Property is suitable for a 1031
Program, IREX will prepare and deliver to Venture Corp. a written recommendation
(“Offering Recommendation”) for the joint venturing of the property through a
newly formed Delaware limited liability company or a Delaware statutory trust (a
“Venture Sub”) of which the Company shall be the sole member or initial
beneficiary and an IREX owned entity (a “Venture Sub Manager”) shall be the sole
manager or signatory trustee.  The Offering Recommendation shall include the
proposed capital requirements, use of proceeds, estimated Retained Percentage,
any Equity Advance to be required of Venture Corp. and other matters that IREX
generally considers in syndicating proposed properties for its own 1031
Programs. Thereafter, the Members shall negotiate in good faith to attempt to
arrive at mutual agreement as to whether to proceed with the joint venture of
the Target Property and the terms thereof (such mutually agreed terms, a “Target
Property Proposal”).  Neither Member shall be obligated to accept any proposed
Target Property or Offering Recommendation.  In the event IREX does not submit
an Offering Recommendation for a Target Property or if the Members fail to reach
a mutual agreement for a Target Property Proposal, IREX agrees that during the
Recommendation Period, and for a period of 180 days thereafter, it shall not
pursue the Target Property for its own account or as part of its own 1031
Program.

4.4

Formation of Venture Sub

.  With respect to and in the event of each Target Property Proposal, the
Company shall form a Venture Sub to acquire the subject Target Property (or the
title holding entity thereof) using documents or instruments in form and
substance as attached hereto as Exhibit B.

4.5

Equity Advances

.  Venture Corp. shall loan to the Company the amount of equity funds the
Company is required to contribute to a Venture Sub to acquire the Target
Property (as determined under Section 4.3, above), when and in the amount
specified in the respective Target Property Proposal (an “Equity Advance”).
 Each Equity Advance shall be evidenced by a promissory note having the
substance and in the applicable form attached hereto as Exhibit C.  Following
receipt, the Company will contribute the amount of each Equity Advance to the
respective Venture Sub.  An amount equal to the Operating Proceeds generated by
such Venture Sub (with respect to the period between the date of such Equity
Advance and the date when such Equity Advance is repaid in full to Venture
Corp.) shall constitute the base interest payable to Venture Corp. for the
Equity Advance, which shall be payable by the Company as such amounts are
distributed by the Venture Sub to the Company.  In addition, if an Equity
Advance is not repaid in full, excepting only the Retained Percentage Equity
Amount, prior to the Applicable Additional Return Date, then from and after such
Applicable Additional Return Date, Venture Corp. shall be entitled to the
Additional Return on the unpaid portion of the Equity Advance (excepting only
the Retained Percentage Equity Amount) outstanding from time to time until such
Equity Advance has been repaid in full.

4.6

Reimbursement of Syndication Costs

.  A good faith estimate of Syndication Costs shall be presented to the Members
concurrent with the submission of the Offering Recommendation.  When a Venture
Sub offers interests in a Target Property for sale through a private placement
memorandum, the related Syndication Costs (as may be revised from time to time
prior to the publication of the final private placement memorandum by IREX) will
be published in the private placement memorandum.  Subject to Section 4.10 of
this Agreement, IREX shall be reimbursed from offering proceeds for all
Syndication Costs which it has incurred or advanced in the amounts set forth in
the final private placement memorandum regardless whether such actual
Syndication Costs incurred by IREX are greater than or less than the Syndication
Costs set forth in the final private placement memorandum.  No reconciliation of
Syndication Costs shall be conducted.

4.7

Assignment of Rights to Acquire Target Property

.  If the Target Property is already under contract to Venture Corp. or an
Affiliate thereof, Venture Corp. shall have the purchase contract assigned to
the respective Venture Sub prior to the anticipated closing of the Target
Property.

4.8

Management and Service Provider Agreements

.  Prior to the acquisition of any Target Property, each Venture Sub shall enter
into a Management Agreement with its Venture Sub Manager using an agreement in
form and substance as attached hereto as Exhibit D, and the Venture Sub Manager,
thereupon, will enter into a Property Management Sub-Contact with ICPMC using an
agreement in form and substance as attached hereto as Exhibit E.  Each such
Sub-Contract shall provide for, among other things, a property management fee of
4 percent on multi-tenant Target Properties and 2.5 percent on single tenant
Target Properties, based on collected gross income from the Target Property
tenants.  Subject to satisfactory completion of its due diligence review, Inland
Securities Corporation shall be obligated  to enter into a Dealer Manager
Agreement with each Venture Sub using an agreement in form and substance as
attached hereto as Exhibit F providing for the sale of tenant-in-common
interests in the Target Property.  It shall be a condition precedent to Venture
Corp.’s obligation to make an Equity Advance that Inland Securities Corporation
has satisfactorily completed its due diligence review with respect to the Target
Property and has entered into a Dealer Manager Agreement with the applicable
Venture Sub in the form and substance of Exhibit F.

4.9

Service Provider and Other Business Transactions

.  A Venture Sub Manager may cause the Company or any Venture Sub to enter into
other agreements, including service provider agreements, and transact other
business with, IREX or its Affiliates on the same terms and conditions as IREX
from time to time utilizes or approves with respect to its own 1031 Programs.

4.10

Discontinued Venture

.  If any Venture Sub fails to close on the purchase of the Target Property for
any reason or in the event of an Abandoned Syndication, the parties shall not
proceed with the joint venture of the Target Property.  In such event, the
Company will reimburse IREX, Venture Sub and/or Venture Sub Manager for
Syndication Costs and for any other costs incurred by IREX, Venture Sub or
Venture Sub Manager with respect to such Target Property (collectively, the
“Upfront Costs”). However, if Venture Corp. or an affiliate of Venture Corp.
shall subsequently acquire such Target Property, Venture Corp. shall promptly
reimburse the Company in full for all the Upfront Costs paid by the Company in
connection with such Target Property.

4.11

Carve Out Guaranties

.  IRC and IREX shall timely execute and deliver all Target Property lender
requested Carve-Out Guaranties in connection with 1031 Programs sponsored by the
Company and shall share equally in any liability with respect to such Carve-Out
Guaranties.

ARTICLE V
AMENDMENTS TO CERTIFICATE AND AGREEMENT

5.1

Certificate  Amendments

.  The Company may amend its Certificate at any time to add a new provision or
to change or remove an existing provision upon Member Consent.

5.2

Agreement Amendments

.  This Agreement may be amended or modified from time to time upon Member
Consent.

ARTICLE VI
RIGHTS AND DUTIES OF MEMBERS

6.1

Meetings and Notice

.  Meetings of the Members may be called by the Manager or by either Member.
 Notice stating the place, date and hour of the meeting and the purpose or
purposes for which the meeting is called, shall be delivered in writing to both
Members not less than 24 hours and not more than 30 days before the date of any
meeting of the Members, unless notice is waived by both of the Members.

6.2

Informal Action by Members

.  Any action which may be taken at a meeting of the Members may be taken
without a meeting, if a consent in writing, setting forth the action so taken,
shall be signed by both of the Members.

6.3

No Liability of Members

.  No Member shall be liable as such for the liabilities of the Company.  The
failure of the Company to observe any formalities or requirements relating to
the exercise of its powers or management of its business or affairs under this
Agreement or the Act shall not be grounds for imposing personal liability on the
Members (or the Manager) for liabilities of the Company.

6.4

Contributing Member Decisions

.  Notwithstanding anything in this Agreement to the contrary, the Contributing
Member and not the Manager shall have the sole and exclusive right, power and
authority to make all decisions and to take all actions with respect to the
following matters (each a “Contributing Member Decision”):

(a)

any decisions concerning the timing and amount of any distributions of Operating
Proceeds, Investor Net Sales Proceeds and Exit Sale Proceeds, subject to the
retention of a reasonable amount of reserves. Any Venture Sub operating
agreement shall include appropriate provisions authorizing the Company, as sole
member of the Venture Sub, to distribute all available cash of the Venture Sub
to the Company, after making provision for reasonable reserves; and

(b)

all decisions with respect to the sale, conveyance or other disposition of any
Target Property which is the subject of an Abandoned Syndication; provided that
if the Contributing Member desires to sell or otherwise transfer a Target
Property to Venture Corp. or one of its affiliates, the prior written consent of
IREX shall be required. Any Venture Sub operating agreement or trust agreement
shall include appropriate provisions authorizing the Company, as sole member of
such Venture Sub, to sell, convey or otherwise dispose of the Target Property in
the event such Property is the subject of an Abandoned Syndication.

6.5

Lack of Authority

.  No Member, as such, shall take any part in the management or control of the
business of the Company or have power to sign for or bind the Company.
 Notwithstanding the foregoing, the Contributing Member shall have the sole and
exclusive right, power and authority to make the Contributing Member Decisions
and the Members shall have the right to approve or disapprove or otherwise
consent or withhold consent with respect to such other matters as are expressly
specified in this Agreement (pursuant to Section 7.7 or otherwise) as matters
that are required to be taken or approved by the Members under the Act, and any
such approval or action shall require Member Consent.

6.6

Conflicts of Interest

.  No Member shall owe any fiduciary duty to the Company or to the other Member.
 Nothing in this Agreement shall be deemed to restrict in any way the rights of
any Member or its Affiliates, to conduct any other business or activity, and
neither a Member nor the Manager shall be accountable to the Company or to any
other Member with respect to that business or activity.  In particular, it is
understood and agreed that each of IRC, Venture Corp., IREX (as Member and/or
Manager) and their respective Affiliates (i) may engage or invest in, own and/or
manage, independently or with others, any business or activity of any type or
description and neither the Company nor the other Member shall have any right in
or to such other ventures or activities or to the income or proceeds derived
therefrom, (ii) shall not be obligated to present any investment opportunity or
prospective economic advantage to the Company, even if the opportunity is of the
character that, if presented to the Company, could be taken advantage of by the
Company and (iii) shall have the right to hold any business or investment
opportunity or prospective economic advantage, including but not limited to a
potential 1031 Program or property for such a Program, for its own account.

6.7

Representations and Warranties

.  Each Member hereby represents and warrants that such Member is duly
organized, validly existing and in good standing under the laws of its state of
organization and that it has full organizational power to execute this Agreement
and to perform its obligations hereunder.

ARTICLE VII
RIGHTS AND DUTIES OF MANAGER

7.1

Management

.  The business and affairs of the Company shall be managed by the Manager and
by the officers and agents of the Company pursuant to authority granted by the
Manager.  Except as set forth in Sections 6.4, 7.3 and 7.7, and except for any
other situations in which the approval of the Members is expressly required by
this Agreement or by non-waivable provisions of the Act, the Manager shall have
full and complete authority, power and discretion to manage and control the
business, affairs and properties of the Company, to make all decisions regarding
those matters and to perform any and all other acts or activities customary or
incident to the management of the business and affairs of the Company.

7.2

Manager

.  The Company shall have one Manager.  The Manager shall be IREX.

7.3

Power to Bind the Company

.  Except for the Contributing Member Decisions, only the Manager and the
officers and agents of the Company pursuant to authority granted by the Manager
shall have the authority to bind the Company.  Unless authorized by this
Agreement or by the Manager, no attorney-in-fact, employee or other agent of the
Company (other than officers and agents duly authorized by the Manager) shall
have any power or authority to bind the Company in any way, to pledge its credit
or to render it liable for any purpose.

7.4

Fees and Compensation

.  The Company shall reimburse (or if not yet expended, advance on behalf of)
the Manager for all reasonable expenses incurred in managing the Company,
including costs of establishing and maintaining its status as a limited
liability company and all accounting and tax return costs.

7.5

Standard of Care

.  A duty of care shall be applicable to the Manager in respect of the discharge
of its duties to the Company, but such duty shall be limited to refraining from
engaging in Willful Misconduct or acts of gross negligence.  Except as may
otherwise be provided in Article VIII, Venture Corp. and IRC each agree to hold
harmless, and waive any claim against, the Manager for half of any and all
Damages arising from or out of the performance by the Manager of its duties
hereunder, provided the standard of conduct in the prior sentence is satisfied.

7.6

Officers

.  The Company may have officers appointed, from time to time, by the Manager.
 Each officer shall hold office until his or her successor shall have been
appointed, or until his or her death or inability to serve, or until he or she
shall resign or shall have been removed from office.  Any officer may be removed
by the Manager in its sole discretion with or without cause.  The authority,
duties and responsibilities of each officer shall be established, from time to
time, by the Manager.

7.7

Matters Requiring Member Consent

.  Notwithstanding any other provision of this Agreement, the following actions
(“Major Decisions”) shall require Member Consent:

(a)

the creation and capitalization of a Venture Sub for a 1031 Program;

(b)

the making or implementing of any decision to acquire any Property (excluding
acquisitions approved in accordance with Section 4.3 above) for a purchase price
in excess of $10,000, the execution and delivery of any agreement, contract,
binding letter of intent or other document or instrument to purchase any
Property for a purchase price in excess of $10,000 (excluding acquisitions
approved in accordance with Section 4.3 above), and any decision to terminate
any such agreement, contract, letter of intent or other document or instrument;

(c)

the institution of any material legal proceedings in the name of the Company,
settlement of any material legal proceedings against the Company and confession
of any material judgment against the Company or any property of the Company;

(d)

any action or decision with respect to a Bankruptcy Event involving the Company;
and

(e)

a liquidation of the Company, or a merger or consolidation of the Company with
another business or entity.

7.8

REIT Provisions

.  Notwithstanding any other provision of this Agreement or any other document
governing the management and operation of the Company, Venture Corp. shall have
the right to direct the Manager to cause the Company to take any reasonable
action or to refrain from taking any action (including but not limited to using
a protective trust to own assets) to (i) preserve the continued qualification of
IRC as a real estate investment trust under Section 856 of the Code (a “REIT”),
(ii) preserve the continued qualification of any Affiliates of IRC as taxable
REIT subsidiaries and (iii) avoid the imposition of additional taxes on IRC and
its Affiliates under Section 857 of the Code or Section 4981 of the Code and the
Treasury Regulations promulgated thereunder (collectively the “REIT Rules”).
 The Members agree that in the event that Venture Corp. proposes to have the
Manager take any action (or cause the Company to take any action) to ensure the
continued qualification of IRC as a REIT, to preserve the continued
qualification of any Affiliates of IRC as taxable REIT subsidiaries or to avoid
the imposition of additional taxes under the REIT Rules on IRC, Venture Corp.
shall (x) notify and consult with the Manager regarding, and prior to directing,
such proposed action and (y) not have liability to the other Member for monetary
damages or otherwise for losses sustained or liabilities incurred in connection
with such actions provided that Venture Corp. acts in good faith to determine
and implement a course of action that preserves IRC’s REIT status or avoids the
imposition of additional taxes on IRC or Venture Corp. in a manner which
minimizes the adverse effects on any other Member’s rights and obligations
hereunder.

ARTICLE VIII
INDEMNIFICATION

8.1

Indemnification by Venture Corp. and IRC of IREX Indemnified Parties

.  Venture Corp. and IRC shall indemnify, defend and hold IREX and its
Affiliates and their respective officers, directors, employees, shareholders,
representatives, attorneys, agents, predecessors, successors, assigns and
subsidiaries, past, present and future (the “IREX Indemnified Parties”),
harmless from and against any and all Damages arising from or relating to any
information delivered or representation, in connection with any 1031 Program of
a Venture Sub, made by Venture Corp. or IRC or any of their Affiliates to IREX,
the Company or a Venture Sub.

8.2

Indemnification by IREX of IRC Indemnified Parties

.  IREX shall indemnify, defend and hold Venture Corp., IRC, their Affiliates
and their respective officers, directors, employees, shareholders,
representatives, attorneys, agents, predecessors, successors, assigns and
subsidiaries, past, present and future (the “IRC Indemnified Parties”) harmless
from and against any and all Damages arising from or relating to (i) any
Misrepresentation with respect to a private placement memorandum of a Venture
Sub for a 1031 Program or (ii) the failure of the offering and sale of a 1031
Program to be conducted in compliance with the Securities Act and applicable
state securities laws, except with respect to any information delivered or
representation, in connection with any 1031 Program of a Venture Sub, made by
Venture Corp. or IRC or any of their Affiliates to IREX, the Company or a
Venture Sub.

8.3

Other Indemnification Obligations

.  In the event a Member incurs any liability to a third party with respect to
the Company or a Venture Sub, where neither Section 8.1 nor Section 8.2 is
applicable, then the Members agree that any such liability shall be discharged
as follows:  (i) for any such liability arising from the Willful Misconduct or
Misrepresentation of a Member, such Member shall promptly indemnify the other
Member for such liability and all related Damages; and (ii) for all other such
liabilities, the Members agree that to the extent that the Company is unable to
meet or dispose of such liabilities in its own right, the Members shall be
obligated to share, on an equal basis, the amount of such liabilities and
related Damages incurred by the Members.  The obligations created under this
Section are enforceable solely among the Company and the Members and shall not
confer any rights on third parties.

ARTICLE IX
CONTRIBUTIONS AND CAPITAL ACCOUNTS

9.1

Initial Contributions

.

(a)

Each Member has made or will make the Initial Capital Contribution described for
that Member on Exhibit A and shall be entitled to 50 percent of the Membership
Interests in the Company in exchange for such Initial Capital Contribution.

(b)

No interest shall accrue on any Capital Contribution and no Member shall have
the right to withdraw or be repaid on any Capital Contribution except as
provided in this Agreement.

9.2

Additional Capital Contributions From Existing Members

.  If the Manager believes that the Company needs additional funds to conduct
its business, the Manager shall deliver notice thereof to the Members.  If the
Members approve such request for additional funds by Member Consent, each Member
shall make an Additional Capital Contribution equal to the amount set forth in
such notice for such Member within five days after the Manager has obtained
Member Consent for the Additional Capital Contribution.  Any Additional Capital
Contribution shall be made in accordance with the Member’s respective Percentage
Interests.  The Company shall not issue any additional Membership Interests in
exchange for any Additional Capital Contribution.

ARTICLE X
DISTRIBUTIONS

The Contributing Member shall cause the Company to distribute all cash available
for distribution as follows:

(a)

If the Company has received a distribution of Operating Proceeds from a Venture
Sub, such amounts shall be paid as interest to Venture Corp. with respect to the
Equity Advance used to acquire the Target Property generating such Operating
Proceeds, until such time as the Equity Advance (including the Retained
Percentage Equity Amount) is repaid in full.

(b)

If the Company has received a distribution of Investor Net Sales Proceeds or
Exit Sale Proceeds, such amounts shall be paid to Venture Corp. as follows: (i)
first in satisfaction of the unpaid Additional Return, if any, on the Equity
Advance (excepting only the Retained Percentage Equity Amount) used to acquire
the respective Target Property, until such Additional Return has been fully
satisfied; (ii) next, as a repayment of principal on the Equity Advance used to
acquire the respective Target Property, until the Equity Advance (including the
Retained Percentage Equity Amount) has been paid in full; and (iii) pursuant to
subparagraph (c) hereof.

(c)

All other cash (including amounts received as fees by the Company) shall be
distributed to the Members in accordance with their Percentage Interests.

ARTICLE XI
ALLOCATIONS AND TAXES

11.1

Allocation of Profits and Losses

.  Except as otherwise required by Code Section 704 and the Regulations
thereunder, all allocations of Profits and Losses for federal income tax
purposes shall be made to the Members pro rata in accordance with their
Percentage Interests.

11.2

Elections

.  The Manager may make any tax elections for the Company allowed under the Code
or the tax laws of any state or other Taxing Jurisdiction.

11.3

Tax Matters Partner

.  The Manager shall be the tax matters partner pursuant to Section 6231(a)(7)
of the Code and shall take all action as may be necessary to cause each other
Member to become a notice partner within the meaning of Section 6223 of the
Code.

11.4

Method of Accounting

.  The records of the Company shall be maintained, as the Manager may determine,
on either (a) a cash receipts and disbursements method of accounting or (b) an
accrual method of accounting.

11.5

Returns and Other Elections

.  The Manager shall cause the preparation and timely filing of all Company tax
returns.

ARTICLE XII
DISPOSITION OF MEMBERSHIP INTERESTS

No Member shall have the right to Transfer all or any portion of its Membership
Interests and any attempted Transfer of a Membership Interest will be null and
void ab initio.  Each Member hereby acknowledges the reasonableness of the
prohibition contained in this Article XII in view of the purposes of the Company
and the relationship with the other Member.

ARTICLE XIII
TERMINATION OF A MEMBER

13.1

Termination

.  A Member shall be terminated from the Company upon any of the following
events (a “Termination”):

(a)

a Bankruptcy Event with respect to the Member; or

(b)

the dissolution of the Member.

13.2

Effect of Termination

.  Upon the Termination of any Member as set forth in Section 13.1, the Member’s
right to vote and otherwise participate in the management and conduct of the
Company’s business shall terminate.  Such Member shall only be entitled to
receive distributions as provided in this Agreement on account of (or in return
of capital constituting all or any portion of) its Membership Interest and to be
allocated income, gains, losses, deductions and expenses of the Company as
provided in this Agreement on account of such Membership Interest.

ARTICLE XIV
DISSOLUTION AND WINDING UP

14.1

Dissolution

.  The Company shall be dissolved and its affairs wound up, upon the first to
occur of the following events:

(a)

upon Member Consent; or

(b)

as required by the Act.

14.2

Effect of Dissolution

.  Upon dissolution, the Company shall cease carrying on business, as
distinguished from the winding up of the Company business, but the Company is
not terminated, and continues until the winding up of the affairs of the Company
is completed and the articles of dissolution have been issued by the Secretary
of State.

14.3

Distribution of Assets upon Dissolution

.  Upon the winding up of the Company, the Company Property shall be
distributed:

(a)

first, to creditors in satisfaction of Company liabilities (including payments
to Members with respect to any Equity Advance and the interest and Additional
Return on such Equity Advance); and

(b)

thereafter, to the Members in accordance with their Percentage Interests

14.4

Winding Up and Articles of Dissolution

.  The winding up of the Company shall be completed when all its debts,
liabilities and obligations have been discharged or reasonably adequate
provision therefor has been made, and all of the remaining Property and assets
of the Company have been distributed to the Members.  Upon the completion of
winding up of the Company, articles of dissolution shall be filed with the
Secretary of State.

ARTICLE XV
MISCELLANEOUS PROVISIONS

15.1

Notices

.  All notices, demands or other communications to be given or delivered under
or by reason of this Agreement shall be in writing and shall be deemed to have
been given when delivered personally to the recipient, sent to the recipient by
reputable overnight courier service (charges prepaid) or sent by telefax (with
receipt confirmed).  Such notices, demands and other communications shall be
sent to each Member, the Manager and the Company at its address (or to its
telecopier number) set forth on Exhibit A hereto, or such other address (or
telecopier number) as such Member, the Manager or the Company may specify by
written notice to the others.

15.2

Entire Agreement

.  This Agreement, including exhibits attached hereto, is the entire agreement
between the Members and the Company.

15.3

Construction

.  Whenever the singular is used in this Agreement and when required by the
context, the same shall include the plural and vice-versa. Whenever, the
masculine gender is used in this Agreement and when required by the context, the
same shall include the feminine and neuter genders and vice-versa.

15.4

Expenses

.  All out of pocket legal fees and expenses incurred by each of the Members in
connection with the preparation of this Agreement, including the exhibits
attached hereto, and the formation of the Company shall be borne by the Company.

15.5

Headings

.  The headings in this Agreement are inserted for convenience only and are not
intended to describe or limit the scope of this Agreement or any provision
hereof.

15.6

No Partnership Intended for Nontax Purposes

.  Except for federal and state tax purposes, the Members do not intend hereby
to form a partnership.  The Members do not intend to be partners of one to
another.  To the extent any Member, by word or action, represents to another
Person that the other Member is a partner or that the Company is a partnership,
the Member making the wrongful representation shall be liable to the other
Member who incurs personal liability by reason of the wrongful representation
and shall not be entitled to indemnification for the act under Article VIII.

15.7

Rights of Creditors and Third Parties Under Agreement

.  This Agreement is entered into among the Company and the Members for their
exclusive benefit and is not intended for the benefit of any creditor of the
Company or any other Person.  Except and only to the extent provided by
applicable statute, no creditor or third party shall have any rights under this
Agreement or any agreement between the Company and any Member with respect to
any Capital Contribution or otherwise.

15.8

Application of Delaware Law

.  This Agreement shall be governed by the laws of Delaware (without regard to
its conflicts of laws provisions).

15.9

Counterparts

.  This Agreement may be executed in one or more counterparts, each of which
shall constitute an original, and all of which shall constitute one  instrument.

15.10

No Waiver

.  No failure or delay on the part of any party hereto in exercising any right,
power or remedy hereunder or pursuant hereto shall operate as a waiver thereof;
nor shall any single or partial exercise of any such right, power or remedy
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy hereunder or pursuant thereto.

15.11

Severability

.  Wherever possible, each provision of this Agreement shall be interpreted in a
manner so as to be effective and valid under applicable law but, if any
provision of this Agreement shall be prohibited by or invalid under applicable
law, the provision shall be ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of the provision or the remaining
provisions of this Agreement.  If any part of any covenant or other provision in
this Agreement is determined by a court of law to be overly broad thereby making
the covenant unenforceable, the parties hereto agree, and it is their desire,
that the court shall substitute a judicially enforceable limitation in its
place, and that as so modified the covenant shall be binding upon the parties as
if originally set forth herein.

15.12

Benefit

.  This Agreement shall be binding upon, and inure to the benefit of, and shall
be enforceable by, the heirs, successors, legal representatives and permitted
assignees, if any, of the Members and the successors, assignees and transferees
of the Company.

[Remainder of Page Intentionally Left Blank]

WHEREFORE, the undersigned have executed this Agreement on the date first set
forth above.

MEMBERS:

 

INLAND REAL ESTATE EXCHANGE

CORPORATION, a Delaware corporation

 

 

BY:

/s/ Patricia DelRosso

ITS:

President

 

INLAND VENTURE CORPORATION,

a Delaware corporation

 

 

BY:

/s/ Mark Zalatoris

ITS:

Executive Vice President

JOINDER

Inland Real Estate Corporation hereby joins in the execution of this Agreement
for the purpose of confirming that it shall perform its obligations under
Sections 4.10, 7.5 and Article VIII, above.

INLAND REAL ESTATE CORPORATION,

a Maryland corporation

 

 

BY:

/s/ Mark Zalatoris

ITS:

Executive Vice President

1013097_10

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EXHIBIT A

MEMBER NAMES

AND ADDRESSES

CAPITAL

CONTRIBUTIONS

Inland Real Estate Exchange Corporation

$50,000

2901 Butterfield Road

 

Oak Brook, Illinois 60521

 

 

 

 

 

Inland Venture Corporation

$50,000

2901 Butterfield Road

 

Oak Brook, Illinois 60521

 

 

 

 

 

Company address for notice purposes:

 

 

 

IRC-IREX Venture, LLC

 

2901 Butterfield Road

 

Oak Brook, Illinois 60521

 

 

 

Manager address for notice purposes:

 

 

 

Inland Real Estate Exchange Corporation

 

2901 Butterfield Road

 

Oak Brook, Illinois 60521

 

3