Exhibit 10.18

 

GUARANTY OF RECOURSE OBLIGATIONS

(UNSECURED)

 

This GUARANTY OF RECOURSE OBLIGATIONS (UNSECURED) (this “Guaranty”) is made as
of December 27, 2012 by INLAND DIVERSIFIED REAL ESTATE TRUST, INC., a Maryland
corporation, having an address at 2901 Butterfield Road, Oak Brook, Illinois
60523 (“Guarantor”), for the benefit of CANTOR COMMERCIAL REAL ESTATE LENDING,
L.P., a Delaware limited partnership having an address at 110 East 59th Street,
6th Floor, New York, New York 10022 (“Lender”).

 

RECITALS:

 

A.            Pursuant to that certain Promissory Note, dated of even date
herewith, executed by INLAND DIVERSIFIED LAS VEGAS EASTERN BELTWAY, L.L.C., a
Delaware limited liability company (“Borrower”) and payable to the order of
Lender in the original principal amount of THIRTY-FOUR MILLION ONE HUNDRED
THOUSAND and 00/100 DOLLARS ($34,100,000.00) (as the same may be amended,
restated, replaced, supplemented, or otherwise modified from time to time, the
“Note”), Borrower has become indebted, and may from time to time be further
indebted, to Lender with respect to a loan (“Loan”) made pursuant to that
certain Loan Agreement, of even date herewith between Borrower and Lender (as
the same may be amended, restated, replaced, supplemented, or otherwise modified
from time to time, the “Loan Agreement”), which Loan is secured by that certain
Deed of Trust, Security Agreement, Assignment of Leases and Fixture Filing, of
even date herewith (as the same may be amended, restated, replaced,
supplemented, or otherwise modified from time to time, collectively, the
“Security Instrument”), and further evidenced, secured or governed by other
instruments and documents executed in connection with the Loan (together with
the Note, the Loan Agreement and Security Instrument, collectively, the “Loan
Documents”).

 

B.            Lender is not willing to make the Loan, or otherwise extend
credit, to Borrower unless Guarantor unconditionally guarantees payment and
performance to Lender of the Guaranteed Obligations (as herein defined).

 

C.            Guarantor is the owner of a direct or indirect interest in
Borrower, and Guarantor will directly benefit from Lender’s making the Loan to
Borrower.

 

D.            All capitalized terms used but not otherwise defined herein shall
have the meanings ascribed to such terms in the Loan Agreement.

 

NOW, THEREFORE, as an inducement to Lender to make the Loan to Borrower, and to
extend such additional credit as Lender may from time to time extend under the
Loan Documents, and for other good and valuable consideration, the receipt and
legal sufficiency of which are hereby acknowledged, the parties do hereby agree
as follows:

 

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ARTICLE 1

 

NATURE AND SCOPE OF GUARANTY

 

1.1          Guaranty of Guaranteed Obligations.  Guarantor hereby irrevocably
and unconditionally guarantees to Lender and its successors and assigns the
payment and performance of the Guaranteed Obligations as and when the same shall
be due and payable, whether by lapse of time, by acceleration of maturity or
otherwise.  Guarantor hereby irrevocably and unconditionally covenants and
agrees that it is liable for the Guaranteed Obligations as a primary obligor.

 

1.2          Definition of Guaranteed Obligations.  As used herein, the term
“Guaranteed Obligations” means(1):

 

(a)           losses, damages (including, without limitation, punitive or
exemplary damages), costs, expenses, liabilities (including, without limitation,
strict liability), claims, obligations, settlement payments, penalties, fines,
assessments, citations, litigation, demands, defenses, judgments, suits,
proceedings or other expenses of any kind whatsoever incurred or suffered by
Lender (including reasonable attorneys’ fees and expenses and court costs)
(collectively, a “Loss”) arising out of or in connection with the following:

 

(i)            fraud or knowing misrepresentation by Borrower, Guarantor, or Key
Principal in connection with the Loan or the Property;

 

(ii)           gross negligence or willful misconduct of Borrower, Guarantor,
Sole Member or Key Principal in connection with the Loan or the Property;

 

(iii)          breach of any material representation, warranty, covenant or
indemnification provision concerning Environmental Statutes or Hazardous
Substances in the Environmental Indemnity, the Loan Agreement, or the Security
Instrument;

 

(iv)          material physical waste of the Property;

 

(v)           removal or disposal of any material portion of the Property after
an Event of Default;

 

(vi)          breach of any Legal Requirement (including RICO) mandating the
forfeiture by Borrower of the Property, or any portion thereof, because of the
conduct or purported conduct of criminal activity by Borrower or any Restricted
Party in connection therewith;

 

(vii)         any intentional misrepresentation, misleading or incorrect
certification or breach of any material representation, warranty or
certification contained in this Guaranty or any other Loan Document or in any
document executed in connection therewith, pursuant to any of the Loan Documents
or otherwise to induce Lender to make the Loan, or any advance thereof, or

 

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(1)  EXCULPATION PROVISIONS WILL BE REVISED UPON FINALIZATION OF EXCULPATION
PROVISION CONTAINED IN LOAN AGREEMENT.

 

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to release monies from any account held by Lender (including any reserve or
escrow) or to take other action with respect to the Collateral;

 

(viii)        misapplication, misappropriation or conversion by Borrower,
Guarantor, Sole Member or Key Principal of (A) any Insurance Proceeds which are
not applied by Borrower or any Affiliated Manager in accordance with the terms
of the Loan Agreement, (B) any Awards which are not applied by Borrower in
accordance with the terms of the Loan Agreement, (C) any Rents following an
Event of Default, (D) any Rents paid more than one (1) month in advance, or
(E) any other monetary collateral for the Loan;

 

(ix)          failure to pay (or cause to be paid) charges for Taxes or Other
Charges before the same become delinquent unless (A) such Taxes or Other Charges
are the subject of a bona fide dispute in which Borrower or a Tenant is
contesting the amount or validity thereof in accordance with the terms of the
Loan Agreement (or any applicable Lease, as the case may be), or (B) Borrower is
depositing or has deposited required funds into the Tax and Insurance Escrow
Account (as defined in the Loan Agreement) and Lender fails to apply such Tax
and Insurance Escrow Funds (as defined in the Loan Agreement) to Taxes and Other
Charges to the extent there are sufficient funds in the Tax and Insurance Escrow
Account, or (C) such failure is due to the failure of the Property to generate
sufficient Rents to pay such amounts but only so long as Borrower has not
applied rents in violation of the terms of the Loan Agreement or the other Loan
Documents, or (D) such failure is due to the failure of Lender after the
occurrence and during the continuance of an Event of Default to make Rents
available to pay such amounts;

 

(x)           failure to pay charges for labor or materials or other charges or
judgments that can create Liens on any portion of the Property, provided, that,
(i) if such Lien is fully bonded to the satisfaction of Lender (which bond shall
have no resort to the Property for payment) and such Lien is discharged of
record, or (ii) for so long as such Lien is being contested in good faith and in
accordance with the terms of the Loan Agreement, then Guarantor shall not have
any liability to Lender for such Lien under this Section 1.2(a)(x);

 

(xi)          failure to deliver to Lender any security deposits, advance
deposits or any other deposits collected by or on behalf of Borrower with
respect to the Property after a foreclosure of the Property or action in lieu
thereof, except to the extent any such security deposits were applied in
accordance with the terms and conditions of any of the Leases prior to the
occurrence of the Event of Default that gave rise to such foreclosure or action
in lieu thereof;

 

(xii)         failure by Borrower to obtain and maintain, from time to time, the
fully paid for insurance policies in accordance with the terms of the Loan
Agreement unless Borrower is depositing or has deposited required funds into the
Tax and Insurance Escrow Account and Lender fails to apply such Tax and
Insurance Escrow Funds to Insurance Premiums to the extent there are sufficient
funds in the Tax and Insurance Escrow Account;

 

(xiii)        any of Borrower, Sole Member, Key Principal or Guarantor or any
Affiliate of any of the foregoing, in connection with any enforcement action or
exercise or assertion of any right or remedy by or on behalf of Lender under or
in connection with this Guaranty, the Note, the Security Instrument or any other
Loan Document, seeks a defense, judicial intervention or injunctive or other
equitable relief of any kind, or asserts in a pleading

 

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filed in connection with a duly exercised and prosecuted judicial proceeding any
defense against Lender or any right in connection with any security for the
Loan, which a court determines is frivolous or in bad faith;

 

(xiv)        Borrower’s indemnifications of Lender set forth in Section 9.2 of
the Loan Agreement;

 

(xv)         the failure of Borrower to obtain and maintain the fully paid for
Policies in accordance with Section 5.1.2 of the Loan Agreement, except to the
extent that Borrower’s failure to obtain and maintain the fully paid for
Policies is due to (A) the failure of the Property to generate sufficient Rents
to pay such amounts but only so long as Borrower has not applied Rents in
violation of the terms hereof or the other Loan Documents or (B) the failure of
Lender after the occurrence and during the continuance of an Event of Default to
make Rents available to pay such amounts; or

 

(xvi)        the failure of Borrower to comply with its obligations and
liabilities arising relating to Section 4.4 under that certain Agreement of
Purchase and Sale and Contribution Agreement, dated as of October 17, 2012,
between Inland Real Estate Acquisition, Inc., Centennial Centre, L.L.C.,
Centennial Holdings, L.L.C., Eastern — Beltway, Ltd., Retail Development
Partners, LLC, Virgin Territory LLC, and Craig Losee Corner, LLC, as amended by
First Amendment to Agreement of Purchase and Sale and Contribution Agreement,
dated as of December 20, 2012, and as partially assigned to and assumed by
Borrower pursuant to Assignment and Assumption of Agreement, of even date
herewith, by and between Inland Real Estate Acquisition, Inc. and Borrower,
including, without limitation, obligations to make Earnout Payments as and when
required under the terms thereof.

 

(b)           the entire amount of the Debt in the event of:  (A) Borrower, Key
Principal, Sole Member or Guarantor filing a voluntary petition under the
Bankruptcy Code or any other federal or state bankruptcy or insolvency law;
(B) the filing of an involuntary petition against Borrower, Key Principal, Sole
Member or Guarantor under the Bankruptcy Code or any other Federal or state
bankruptcy or insolvency law, in which Borrower, Key Principal, Sole Member,
Guarantor or any Person owning an interest (directly or indirectly) in Borrower,
Key Principal, Sole Member or Guarantor causes such event or condition to occur
(by way of example, but not limitation, such Person seeks the appointment of a
receiver or files a bankruptcy petition), consents to, aids, solicits, supports,
or otherwise cooperates or colludes to cause such condition or event;
(C) Borrower, Key Principal, Sole Member or Guarantor or any Person owning an
interest (directly or indirectly) in Borrower, Key Principal, Sole Member or
Guarantor filing an answer consenting to or otherwise acquiescing or joining in
any involuntary petition filed against Borrower, Key Principal, Sole Member or
Guarantor, by any other Person under the Bankruptcy Code or any other Federal or
state bankruptcy or insolvency law; (D) Borrower, Key Principal, Sole Member or
Guarantor or any Person owning an interest (directly or indirectly) in Borrower,
Key Principal, Sole Member or Guarantor consenting to or otherwise acquiescing
or joining in an application for the appointment of a custodian, receiver,
trustee, or examiner for Borrower or any portion of the Property (other than at
the direction nor request of Lender); (E) Borrower, Key Principal, Sole Member
or Guarantor making an assignment for the benefit of creditors, or admitting in
writing in any legal proceeding, its insolvency or inability to pay its debts as
they become due; (F) Borrower, Key Principal or Sole Member failing to obtain
Lender’s prior

 

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written consent to any Indebtedness or voluntary Lien encumbering the Property
as required by the Loan Agreement or the Security Instrument; (G) Borrower, Key
Principal or Sole Member failing to obtain Lender’s prior written consent to any
Transfer, as required by the Loan Agreement or the Security Instrument;
(H) Borrower, Key Principal or Sole Member failing to comply with any
representation, warranty or covenant set forth in Section 4.1.30 of the Loan
Agreement or failing to maintain its status as a Special Purpose Entity (unless
such failure is de minimus and promptly cured), as required by, and in
accordance with, the terms and provisions of the Loan Agreement or the Security
Instrument; or (I) the first Monthly Debt Service Payment Amount is not paid
within five (5) days of notice that such payment is late (provided, however,
that such grace period relates only to the recourse trigger described in this
paragraph and not to late charges, Defaults, Events of Default or to any other
Monthly Debt Service Payment Amount).  Notwithstanding the provision set forth
in clause (F) of this paragraph, a voluntary Lien other than a Lien securing an
extension of credit filed against the Property shall not constitute a Springing
Recourse Event (as defined in the Loan Agreement) provided such Lien is fully
bonded (and as a result thereof, the obligee of the bond shall look solely to
the issuer of the bond and not to the Property for payment).  Upon the
satisfaction of the condition set forth in the preceding sentence with respect
to the Springing Recourse Event described in clause (F) above, or the acceptance
by Lender of any cure by Borrower of a Springing Recourse Event described in
clause (G) above (which Lender is not obligated to accept and may reject or
accept in its sole and absolute discretion), the Debt shall no longer be fully
recourse to Borrower solely as a result of such Springing Recourse Event,
provided, however, Borrower shall remain liable to the extent of any loss,
damage, cost, expense, liability, claim or other obligation incurred by Lender
(including reasonable attorneys’ fees and costs reasonably incurred) arising out
of or in connection with such Springing Recourse Event; and

 

(c)           the full amount of all Insurance Premiums for all Policies
required to be furnished by Borrower pursuant to the Loan Agreement during the
term of the Loan to the extent such Insurance Premiums are not paid by Borrower
when due; and

 

(d)           without limiting the amounts due under Section 1.2(a)(ix) above,
the full amount of all Taxes and Other Charges levied and assessed against the
Property during the term of the Loan to the extent such Taxes and Other Charges
are not paid by Borrower when due.

 

Notwithstanding the foregoing, provided that any natural person serving as an
Independent Director has agreed in writing that it is not, and will not become,
a stockholder in Borrower, Guarantor or any Affiliate, the disqualification of
such person from serving as an Independent Director because (1) such person
became a stockholder in Guarantor or any publicly held Affiliate of Borrower or
Guarantor without the knowledge or consent of Borrower, Guarantor or the
applicable Affiliate, or (2) a member of such natural person’s immediate family
is, or became, a stockholder in Guarantor or any publicly traded Affiliate of
Borrower or Guarantor without the knowledge or consent of Borrower, Guarantor or
the applicable Affiliate, shall not trigger recourse under this
Section 1.2(b) provided Borrower, upon obtaining knowledge of such person’s
ineligibility to serve as an Independent Director, promptly takes commercially
reasonable actions to cause such person to resign and to replace such person
with an eligible Independent Director in accordance with the terms of the Loan
Agreement.

 

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Notwithstanding anything to the contrary in this Guaranty or in any of the other
Loan Documents, Lender shall not be deemed to have waived any right which Lender
may have under Section 506(a), 506(b), 1111(b) or any other provisions of the
Bankruptcy Code to file a claim for the full amount of the Debt or to require
that all collateral shall continue to secure all of the Debt owing to Lender in
accordance with the Loan Documents.  Guarantor expressly waives any defense or
benefits arising out of any voluntary or involuntary filing by or on behalf of
Borrower for protection under any federal or state bankruptcy, insolvency, or
debtor relief laws, including without limitation under Sections 364 or
1111(b)(2) of the Bankruptcy Code.

 

1.3          Nature of Guaranty.  This Guaranty is an irrevocable, absolute,
continuing guaranty of payment and performance and not a guaranty of
collection.  This Guaranty may not be revoked by Guarantor and shall continue to
be effective with respect to any Guaranteed Obligations arising or created after
any attempted revocation by Guarantor and after (if Guarantor is a natural
person) Guarantor’s death (in which event this Guaranty shall be binding upon
Guarantor’s estate and Guarantor’s legal representatives and heirs).  The fact
that at any time or from time to time the Guaranteed Obligations may be
increased or reduced shall not release or discharge the obligation of Guarantor
to Lender with respect to the Guaranteed Obligations.  This Guaranty may be
enforced by Lender and any subsequent holder of the Note and shall not be
discharged by the assignment or negotiation of all or part of the Note.

 

1.4          Intentionally Omitted.

 

1.5          Payment By Guarantor.  If all or any part of the Guaranteed
Obligations shall not be paid when due, whether at demand, maturity,
acceleration or otherwise, Guarantor shall, immediately upon demand by Lender,
and without presentment, protest, notice of protest, notice of non-payment,
notice of intention to accelerate the maturity, notice of acceleration of the
maturity, or any other notice whatsoever, all such notices being hereby waived
by Guarantor, pay in lawful money of the United States of America, the amount
due on the Guaranteed Obligations to Lender at Lender’s address as set forth
herein.  Such demand(s) may be made at any time coincident with or after the
time for payment of all or part of the Guaranteed Obligations, and may be made
from time to time with respect to the same or different items of Guaranteed
Obligations.  Such demand shall be deemed made, given and received in accordance
with the notice provisions hereof.

 

1.6          No Duty To Pursue Others.  It shall not be necessary for Lender
(and Guarantor hereby waives any rights which Guarantor may have to require
Lender), in order to enforce the obligations of Guarantor hereunder, first to
(a) institute suit or exhaust its remedies against Borrower or others liable on
the Loan or the Guaranteed Obligations or any other Person, (b) enforce Lender’s
rights against any collateral which shall ever have been given to secure the
Loan, (c) enforce Lender’s rights against any other guarantors of the Guaranteed
Obligations, (d) join Borrower or any others liable on the Guaranteed
Obligations in any action seeking to enforce this Guaranty, (e) exhaust any
remedies available to Lender against any collateral which shall ever have been
given to secure the Loan, or (f) resort to any other means of obtaining payment
of the Guaranteed Obligations. Lender shall not be required to mitigate damages
or take any other action to reduce, collect or enforce the Guaranteed
Obligations.

 

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1.7          Waivers.  Guarantor agrees to the provisions of the Loan Documents,
and hereby waives to the fullest extent now or hereafter not prohibited by
applicable law (I) notice of (a) any loans or advances made by Lender to
Borrower, (b) acceptance of this Guaranty, (c) any amendment or extension of the
Note, the Loan Agreement or any other Loan Document, (d) the execution and
delivery by Borrower and Lender of any other loan or credit agreement or of
Borrower’s execution and delivery of any promissory notes or other documents
arising under the Loan Documents or in connection with the Property, (e) the
occurrence of (X) any breach by Borrower of any of the terms or conditions of
the Loan Agreement or any other Loan Documents, or (Y) an Event of Default,
(f) Lender’s transfer or disposition of the Guaranteed Obligations, or any part
thereof, (g) sale or foreclosure (or posting or advertising for sale or
foreclosure) of any collateral for the Guaranteed Obligations, (h) protest,
proof of non-payment or default by Borrower, and (i) any other action at any
time taken or omitted by Lender, and, generally, all demands and notices of
every kind in connection with this Guaranty, the Loan Documents, any documents
or agreements evidencing, securing or relating to any of the Guaranteed
Obligations and/or the obligations hereby guaranteed, (II) all suretyship
defenses and defenses in the nature thereof, (III) any right or claim of right
to cause a marshalling of the assets of Borrower or of any collateral for the
Loan, or to cause Lender to proceed against any of the other security for the
Guaranteed Obligations or the Obligations of Borrower before proceeding under
this Guaranty against Guarantor, or, if there shall be more than one Guarantor,
to require Lender to proceed against any other Guarantor or any of the
Guarantors in any particular order, (IV) the right to assert a counterclaim,
other than a mandatory or compulsive counterclaim, in any action or proceeding
brought against or by Guarantor, (V) any defense that may arise by reason of the
incapacity, lack of authority, death or disability of any other person or
persons or the failure of Lender to file or enforce a claim against the estate
(in administration, bankruptcy or any other proceeding) of any other person or
persons, (VI) any defense based upon an election of remedies by Lender,
(VII) any duty on the part of Lender to disclose to Guarantor any facts Lender
may now or hereafter know about Borrower, any Tenant, or the Property,
regardless of whether Lender has reason to believe that any such facts
materially increase the risk beyond that which Guarantor intends to assume or
has reason to believe that such facts are unknown to Guarantor or has a
reasonable opportunity to communicate such facts to Guarantor, it being
understood and agreed that Guarantor is fully responsible for being and keeping
informed of the financial condition of Borrower, any Tenant or of the condition
of the Property and of any and all circumstances bearing on the risk that
liability may be incurred by Guarantor hereunder; (VIII) any lack of notice of
disposition or of manner of disposition of any collateral for the Loan, (IX) any
invalidity, irregularity or unenforceability, in whole or in part, of any one or
more of the Loan Documents, (X) any lack of commercial reasonableness in dealing
with the collateral for the Loan, (XI) any deficiencies in the collateral for
the Loan or any deficiency in the ability of Lender to collect or to obtain
performance from any persons or entities now or hereafter liable for the payment
and performance of any obligation hereby guaranteed, (XII) an assertion or claim
that the automatic stay provided by 11 U.S.C. §362 (arising upon the voluntary
or involuntary bankruptcy proceeding of Borrower) or any other stay provided
under any other debtor relief law (whether statutory, common law, case law or
otherwise) of any jurisdiction whatsoever, now or hereafter in effect, which may
be or become applicable, shall operate or be interpreted to stay, interdict,
condition, reduce or inhibit the ability of Lender to enforce any of its rights,
whether now or hereafter required, which Lender may have against Guarantor or
the collateral for the Loan, (XIII) any modifications of the Loan Documents or
any obligation of

 

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Borrower relating to the Loan by operation of law or by action of any court,
whether pursuant to the Bankruptcy Code, or any other debtor relief law (whether
statutory, common law, case law or otherwise) of any jurisdiction whatsoever,
now or hereafter in effect, or otherwise, and (XIV) the benefits of the “one
action rule” under NRS 40.430, to the extent permitted in NRS Section 40.495.

 

1.8          No Impairment.  The liability of Guarantor hereunder shall in no
way be limited, expanded or impaired by, and Guarantor hereby assents to and
agrees to be bound by, any amendment or modification of the provisions of the
Loan Documents to or with Lender by Borrower or any other Guarantor or any
person who succeeds Borrower as owner of the Property.  In addition, the
liability of Guarantor under this Guaranty and the other Loan Documents shall in
no way be limited, expanded or impaired by:

 

A.            any acceleration of the Loan or any extensions of time for
performance required by any of the Loan Documents;

 

B.            any amendment to or modification of any of the Loan Documents;

 

C.            any sale or assignment of the Loan or any sale, assignment or
foreclosure of the Security Instrument or any sale, transfer or exchange of all
or part of the Property;

 

D.            any exculpatory, or nonrecourse, or limited recourse, provision in
any of the Loan Documents limiting Lender’s recourse to the Property encumbered
by the Security Instrument or to any other property or limiting Lender’s rights
to a deficiency judgment against Borrower or any other person or entity;

 

E.            the accuracy or inaccuracy of the representations and warranties
made by or on behalf of Guarantor herein or by or on behalf of Borrower, or any
affiliate or successor of Borrower in any of the Loan Documents;

 

F.             the release of Borrower, any affiliate or successor of Borrower
or of any other person or entity from performance or observance of any of the
agreements, covenants, terms or conditions contained in any of the Loan
Documents by operation of law, Lender’s voluntary act or otherwise;

 

G.            the filing of any bankruptcy or reorganization proceeding by or
against Borrower, any affiliate or successor of Borrower or any subsequent owner
of the Property;

 

H.            the release or substitution in whole or in part of any collateral
or security for the Obligations or the Guaranteed Obligations;

 

I.             Lender’s failure to record the Security Instrument or file any
UCC financing statements, or Lender’s improper recording or filing of any
thereof, or Lender’s failure to otherwise perfect, protect, secure, or insure
any security interest or lien given as security for the Obligations;

 

J.             the release of any other party now or hereafter liable upon or in
respect of

 

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this Guaranty or any of the other Loan Documents;

 

K.            the invalidity or unenforceability of all or any portion of any of
the Loan Documents as to Borrower or any other person or entity;

 

L.            any change in the composition of Borrower, including, without
limitation, the withdrawal or removal of the beneficial owner from any current
or future position of ownership, management or control of Borrower; or

 

M.           the taking or failure to take any action of any type whatsoever.

 

Any of the foregoing may be accomplished with or without notice to Borrower or
Guarantor and with or without consideration.

 

1.9          Payment of Expenses.  In the event that Guarantor should breach or
fail to timely perform any provisions of this Guaranty, Guarantor shall,
immediately upon demand by Lender, pay Lender all costs and expenses (including
court costs and reasonable attorneys’ fees and costs) incurred by Lender in the
enforcement hereof or the preservation of Lender’s rights hereunder together
with interest thereon at the Default Rate from the date that is thirty (30) days
after the date payment is requested by Lender if such amount is not paid within
such thirty (30) day period until the date of payment to Lender.  The covenant
contained in this Section 1.9 shall survive the payment and performance of the
Guaranteed Obligations.

 

1.10        Effect of Bankruptcy.  In the event that, pursuant to any
insolvency, bankruptcy, reorganization, receivership or other debtor relief law,
or any judgment, order or decision thereunder, Lender must rescind or restore
any payment, or any part thereof, received by Lender in satisfaction of the
Guaranteed Obligations, as set forth herein, any prior release or discharge from
the terms of this Guaranty given to Guarantor by Lender shall be without effect,
and this Guaranty shall remain (or shall be reinstated to be) in full force and
effect. It is the intention of Borrower and Guarantor that Guarantor’s
obligations hereunder shall not be discharged except by Guarantor’s performance
of such obligations and then only to the extent of such performance.

 

1.11        Waiver of Subrogation, Reimbursement and Contribution. 
Notwithstanding anything to the contrary contained in this Guaranty, Guarantor,
to the fullest extent now or hereafter not prohibited by applicable law, hereby
unconditionally and irrevocably waives, releases and abrogates any and all
rights it may now or hereafter have under any agreement, at law or in equity
(including, without limitation, any law subrogating the Guarantor to the rights
of Lender), to assert any claim against or seek contribution, indemnification or
any other form of reimbursement from Borrower or any other party liable for
payment of any or all of the Guaranteed Obligations for any payment made by
Guarantor under or in connection with this Guaranty or otherwise.

 

1.12        Delay Not Waiver.  No delay on Lender’s part in exercising any
right, power or privilege hereunder or under any of the Loan Documents shall
operate as a waiver of any such privilege, power or right.  No waiver by Lender
in any instance shall constitute a waiver in any other instance

 

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1.13        Borrower/Guarantor.  The term “Borrower” or “Guarantor” as used
herein shall include any new or successor corporation, association, partnership
(general or limited), limited liability company, joint venture, trust or other
individual or organization formed as a result of any merger, reorganization,
sale, transfer, devise, gift or bequest of Borrower or Guarantor, as the case
may be, or any interest in Borrower or Guarantor, as the case may be.

 

ARTICLE 2

 

EVENTS AND CIRCUMSTANCES NOT REDUCING OR DISCHARGING GUARANTOR’S OBLIGATIONS

 

Guarantor hereby consents and agrees to each of the following, and agrees that
Guarantor’s obligations under this Guaranty shall not be released, diminished,
impaired, reduced or adversely affected by any of the following, and waives, to
the fullest extent now or hereafter not prohibited by applicable law, any common
law, equitable, statutory or other rights (including without limitation rights
to notice) which Guarantor might otherwise have as a result of or in connection
with any of the following:

 

2.1          Modifications/Sales.  Any renewal, extension, increase,
modification, alteration or rearrangement of all or any part of the Guaranteed
Obligations, the Note, the Security Instrument, the Loan Agreement, the other
Loan Documents or any other document, instrument, contract or understanding
between Borrower and Lender or any other parties pertaining to the Guaranteed
Obligations, or any sale, assignment or foreclosure of the Note, the Loan
Agreement, the Security Instrument, or any other Loan Documents or any sale or
transfer of the Property, or any failure of Lender to notify Guarantor of any
such action.

 

2.2          Adjustment.  Any adjustment, indulgence, forbearance or compromise
that might be granted or given by Lender to Borrower or any Guarantor.

 

2.3          Condition of Borrower or Guarantor. The insolvency, bankruptcy,
arrangement, adjustment, composition, liquidation, disability, dissolution or
lack of power of Borrower, Guarantor or any other Person at any time liable for
the payment of all or part of the Guaranteed Obligations; or any dissolution of
Borrower or Guarantor, or any sale, lease or transfer of any or all of the
assets of Borrower or Guarantor, or any changes in the shareholders, partners or
members, as applicable, of Borrower or Guarantor; or any reorganization of
Borrower or Guarantor.

 

2.4          Invalidity of Guaranteed Obligations.  The invalidity, illegality
or unenforceability of all or any part of the Guaranteed Obligations, or any
document or agreement executed in connection with the Guaranteed Obligations,
for any reason whatsoever, including without limitation the fact that (a) the
Guaranteed Obligations, or any part thereof, exceed the amount permitted by
Legal Requirements, (b) the act of creating the Guaranteed Obligations or any
part thereof is ultra vires, (c) the officers or representatives executing the
Note, the Security Instrument, the Loan Agreement or the other Loan Documents or
otherwise creating the Guaranteed Obligations acted in excess of their
authority, (d) the Guaranteed Obligations violate applicable usury laws, (e) the
Borrower has valid defenses, claims or offsets (whether at law, in equity or by
agreement) which render the Guaranteed Obligations wholly or partially

 

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uncollectible from Borrower, (f) the creation, performance or repayment of the
Guaranteed Obligations (or the execution, delivery and performance of any
document or instrument representing part of the Guaranteed Obligations or
executed in connection with the Guaranteed Obligations, or given to secure the
repayment of the Guaranteed Obligations) is illegal, uncollectible or
unenforceable, or (g) the Note, the Security Instrument, the Loan Agreement or
any of the other Loan Documents have been forged or otherwise are irregular or
not genuine or authentic, it being agreed that Guarantor shall remain liable
hereon regardless of whether Borrower or any other Person be found not liable on
the Guaranteed Obligations or any part thereof for any reason.

 

2.5                               Release of Obligors.  Any full or partial
release of the liability of Borrower for the Guaranteed Obligations, or any part
thereof, or of any co-guarantors, or any other Person now or hereafter liable,
whether directly or indirectly, jointly, severally, or jointly and severally, to
pay, perform, guarantee or assure the payment of the Guaranteed Obligations, or
any part thereof, it being recognized, acknowledged and agreed by Guarantor that
Guarantor may be required to pay the Guaranteed Obligations in full without
assistance or support from any other Person, and Guarantor has not been induced
to enter into this Guaranty on the basis of a contemplation, belief,
understanding or agreement that other Persons (including Borrower) will be
liable to pay or perform the Guaranteed Obligations, or that Lender will look to
other Persons (including Borrower) to pay or perform the Guaranteed Obligations.

 

2.6                               Other Collateral.  The taking or accepting of
any other security, collateral or guaranty, or other assurance of payment, for
all or any part of the Guaranteed Obligations.

 

2.7                               Release of Collateral.  Any release,
surrender, exchange, subordination, deterioration, waste, loss or impairment
(including without limitation negligent, willful, unreasonable or unjustifiable
impairment) of any collateral, property or security at any time existing in
connection with, or assuring or securing payment of, all or any part of the
Guaranteed Obligations.

 

2.8                               Care and Diligence.  The failure of Lender or
any other party to exercise diligence or reasonable care in the preservation,
protection, enforcement, sale or other handling or treatment of all or any part
of such collateral, property or security, including but not limited to any
neglect, delay, omission, failure or refusal of Lender (a) to take or prosecute
any action for the collection of any of the Guaranteed Obligations or (b) to
foreclose, or initiate any action to foreclose, or, once commenced, prosecute to
completion any action to foreclose upon any security therefor, or (c) to take or
prosecute any action in connection with any instrument or agreement evidencing
or securing all or any part of the Guaranteed Obligations.

 

2.9                               Unenforceability.  The fact that any
collateral, security, security interest or lien contemplated or intended to be
given, created or granted as security for the repayment of the Guaranteed
Obligations, or any part thereof, shall not be properly perfected or created, or
shall prove to be unenforceable or subordinate to any other security interest or
lien, it being recognized and agreed by Guarantor that Guarantor is not entering
into this Guaranty in reliance on, or in contemplation of the benefits of, the
validity, enforceability, collectability or value of any of the collateral for
the Guaranteed Obligations.

 

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2.10                        Intentionally Omitted.

 

2.11                        Offset.  The Note, the Guaranteed Obligations and
the liabilities and obligations of Guarantor to Lender hereunder shall not be
reduced, discharged or released because or by reason of any existing or future
right of offset, claim or defense of Borrower or any party against Lender, or
any other Person, or against payment of the Guaranteed Obligations, whether such
right of offset, claim or defense arises in connection with the Guaranteed
Obligations (or the transactions creating the Guaranteed Obligations) or
otherwise.

 

2.12                        Merger.  The reorganization, merger or consolidation
of Borrower or Guarantor into or with any Person.

 

2.13                        Preference.  Any payment by Borrower to Lender is
held to constitute a preference under bankruptcy laws, or for any reason Lender
is required to refund such payment or pay such amount to Borrower or to any
other Person.

 

2.14                        Other Actions Taken or Omitted.  Any other action
taken or omitted to be taken with respect to the Loan Documents, the Guaranteed
Obligations, or the security and collateral therefor, whether or not such action
or omission prejudices Guarantor or increases the likelihood that Guarantor will
be required to pay the Guaranteed Obligations pursuant to the terms hereof, it
being the unambiguous and unequivocal intention of Guarantor that Guarantor
shall be obligated to pay the Guaranteed Obligations when due, notwithstanding
any occurrence, circumstance, event, action, or omission whatsoever, whether
contemplated or uncontemplated, and whether or not otherwise or particularly
described herein, which obligation shall be deemed satisfied only upon the full
and final payment and satisfaction of the Guaranteed Obligations.

 

2.15                        Ability to Enforce Certain Environmental Claims. 
Nothing contained in this Guaranty shall prevent or in any way diminish or
interfere with any rights or remedies, including, without limitation, the right
to contribution, which Lender may have against Borrower, Guarantor or any other
party under the Comprehensive Environmental Response, Compensation and Liability
Act of 1980 (codified at Title 42 U.S.C. §9601 et seq.) as it may be amended
from time to time, or any other applicable federal, state or local laws, all
such rights being hereby expressly reserved.

 

ARTICLE 3

 

REPRESENTATIONS AND WARRANTIES

 

To induce Lender to enter into the Loan Documents and extend credit to Borrower,
Guarantor represents and warrants to Lender as follows:

 

3.1                               Benefit.  Guarantor is an Affiliate of
Borrower, is the owner of a direct or indirect interest in Borrower, and has
received, or will receive, direct or indirect benefit from the making of this
Guaranty with respect to the Guaranteed Obligations.

 

3.2                               Familiarity and Reliance.  Guarantor is
familiar with, and has independently reviewed books and records regarding, the
financial condition of the Borrower and is familiar with the value of any and
all collateral intended to be created as security for the payment of the

 

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Note or Guaranteed Obligations; however, Guarantor is not relying on such
financial condition or the collateral as an inducement to enter into this
Guaranty.

 

3.3                               No Representation By Lender.  Neither Lender
nor any other party has made any representation, warranty or statement to
Guarantor in order to induce the Guarantor to execute this Guaranty.

 

3.4                               Guarantor’s Financial Condition.  As of the
date hereof, and after giving effect to this Guaranty and the contingent
obligation evidenced hereby, Guarantor is, and will be, solvent, and has and
will have assets which, fairly valued, exceed its obligations, liabilities
(including contingent liabilities) and debts, and has and will have property and
assets sufficient to satisfy and repay its obligations and liabilities,
including the Guaranteed Obligations.  In addition, true and complete copies of
the financial statements of Guarantor have been delivered to Lender and each of
the same are true, accurate and complete and fairly present Guarantor’s
financial condition as of the dates thereof and no material and adverse change
has occurred in Guarantor’s financial condition or business since the respective
dates thereof; and each financial statement of Guarantor submitted in the future
shall be true, accurate and complete and shall fairly present Guarantor’s
financial condition as of the dates thereof.

 

3.5                               Legality.  To Guarantor’s knowledge, the
execution, delivery and performance by Guarantor of this Guaranty and the
consummation of the transactions contemplated hereunder do not, and will not,
contravene or conflict with any law, statute or regulation whatsoever to which
Guarantor is subject or constitute a default (or an event which with notice or
lapse of time or both would constitute a default) under, or result in the breach
of, any indenture, mortgage, deed of trust, charge, lien, or any contract,
agreement or other instrument to which Guarantor is a party or which may be
applicable to Guarantor.  This Guaranty is a legal and binding obligation of
Guarantor and is enforceable in accordance with its terms, except as limited by
bankruptcy, insolvency or other laws of general application relating to the
enforcement of creditors’ rights.

 

3.6                               No Violation.  To Guarantor’s knowledge, the
payment and performance by Guarantor of Guarantor’s obligations under the Loan
Agreement and this Guaranty do not and shall not constitute a violation of any
law, order, regulation, contract or agreement to which Guarantor is a party or
by which Guarantor or Guarantor’s property may be bound.

 

3.7                               No Litigation.  There is no material
litigation now pending or, to the best of Guarantor’s knowledge threatened in
writing, against Guarantor which, if adversely decided would materially impair
the ability of Guarantor to pay and perform Guarantor’s obligations under the
Loan Agreement or this Guaranty.  There is no litigation (whether or not
material) pending, or threatened in writing, against Guarantor in which the
amount in controversy exceeds $500,000 which is not either:  (i) covered by
adequate insurance, or (ii) previously disclosed in writing to Lender together
with a written explanation of why such litigation is not material.

 

3.8                               Entity Matters.  Guarantor is a duly
organized, validly existing corporation organized and in good standing under the
laws of Maryland, has all requisite power and authority to conduct its business
and to own its property as now conducted or owned, and is qualified to do
business in all jurisdictions where the nature and extent of its business is
such that qualification is required by law.

 

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3.9                               Material Economic Benefit.  The granting of
the Loan to Borrower will constitute a material economic benefit to Guarantor.

 

3.10                        Survival.  All representations and warranties made
by Guarantor herein shall survive the execution hereof.

 

ARTICLE 4

 

SUBORDINATION OF CERTAIN INDEBTEDNESS

 

4.1                               Subordination of All Guarantor Claims.  As
used herein, the term “Guarantor Claims” shall mean all debts and liabilities of
Borrower to Guarantor, whether such debts and liabilities now exist or are
hereafter incurred or arise, and whether the obligations of Borrower thereon be
direct, contingent, primary, secondary, several, joint and several, or
otherwise, and irrespective of whether such debts or liabilities be evidenced by
note, contract, open account, or otherwise, and irrespective of the Person or
Persons in whose favor such debts or liabilities may, at their inception, have
been, or may hereafter be created, or the manner in which they have been or may
hereafter be acquired by Guarantor.  The Guarantor Claims shall include without
limitation all rights and claims of Guarantor against Borrower (arising as a
result of subrogation or otherwise) as a result of Guarantor’s payment of all or
a portion of the Guaranteed Obligations.  So long as any portion of the Debt or
the Guaranteed Obligations remain outstanding, Guarantor shall not receive or
collect, directly or indirectly, from Borrower or any other Person any amount
upon the Guarantor Claims.

 

4.2                               Claims in Bankruptcy.  In the event of any
receivership, bankruptcy, reorganization, arrangement, debtor’s relief, or other
insolvency proceeding involving Guarantor as a debtor, Lender shall have the
right to prove its claim in any such proceeding so as to establish its rights
hereunder and receive directly from the receiver, trustee or other court
custodian dividends and payments which would otherwise be payable upon Guarantor
Claims.  Guarantor hereby assigns such dividends and payments to Lender.  Should
Lender receive, for application against the Guaranteed Obligations, any such
dividend or payment which is otherwise payable to Guarantor, and which, as
between Borrower and Guarantor, shall constitute a credit against the Guarantor
Claims, then upon payment to Lender in full of the Guaranteed Obligations,
Guarantor shall become subrogated to the rights of Lender to the extent that
such payments to Lender on the Guarantor Claims have contributed toward the
liquidation of the Guaranteed Obligations, and such subrogation shall be with
respect to that proportion of the Guaranteed Obligations which would have been
unpaid if Lender had not received dividends or payments upon the Guarantor
Claims.

 

4.3                               Payments Held in Trust.  Notwithstanding
anything to the contrary in this Guaranty, in the event that any Guarantor shall
receive any funds, payments, claims or distributions which are prohibited by
this Guaranty, Guarantor agrees to hold in trust for Lender an amount equal to
the amount of all funds, payments, claims or distributions so received, and
agrees that it shall have absolutely no dominion over the amount of such funds,
payments, claims and/or distributions so received except to pay such funds,
payments, claims and/or distributions promptly to Lender, and Guarantor
covenants promptly to pay the same to Lender.

 

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4.4                               Liens Subordinate.  Guarantor agrees that any
liens, security interests, judgment liens, charges or other encumbrances upon
Borrower’s assets securing payment of the Guarantor Claims shall be and remain
inferior and subordinate to any liens, security interests, judgment liens,
charges or other encumbrances upon Borrower’s assets securing payment of the
Guaranteed Obligations, regardless of whether such encumbrances in favor of
Guarantor or Lender presently exist or are hereafter created or attach.  Without
the prior written consent of Lender, Guarantor shall not (a) exercise or enforce
any creditor’s rights it may have against Borrower, or (b) foreclose, repossess,
sequester or otherwise take steps or institute any action or proceedings
(judicial or otherwise, including without limitation the commencement of, or the
joinder in, any liquidation, bankruptcy, rearrangement, debtor’s relief or
insolvency proceeding) to enforce any liens, mortgages, deeds of trust, security
interests, collateral rights, judgments or other encumbrances on assets of
Borrower held by Guarantor.

 

ARTICLE 5

 

COVENANTS

 

5.1                               Definitions.  As used in this Article 5, the
following terms shall have the respective meanings set forth below:

 

(a)                                 “Consolidated Subsidiaries” shall mean each
Subsidiary of Guarantor, the financial statements of which shall be (or should
have been) consolidated with the financial statements of Guarantor in accordance
with GAAP.

 

(b)                                 “GAAP” shall mean generally accepted
accounting principles, consistently applied.

 

(c)                                  “Liquid Assets” shall mean assets in the
form of cash, cash equivalents, obligations of (or fully guaranteed as to
principal and interest by) the United States or any agency or instrumentality
thereof (provided the full faith and credit of the United States supports such
obligation or guarantee), certificates of deposit issued by a commercial bank
having net assets of not less than $500 million, securities listed and traded on
a recognized stock exchange or traded over the counter and listed in the
National Association of Securities Dealers Automatic Quotations, or liquid debt
instruments that have a readily ascertainable value and are regularly traded in
a recognized financial market.

 

(d)                                 “Net Worth” shall mean, as of a given date,
(x) the total assets of Guarantor as of such date less (y) Guarantor’s total
liabilities as of such date, determined in accordance with GAAP.

 

(e)                                  “Subsidiary” shall mean any Affiliate of
Guarantor that is controlled by Guarantor.

 

5.2                               Covenants.  Until all of the Obligations and
the Guaranteed Obligations have been paid in full, Guarantor (i) shall at all
times maintain (A) a Net Worth of at least $350,000,000, and (B) Liquid Assets
having a market value of at least $10,000,000, (ii) shall deliver to Lender
within five (5) Business Days of receipt, copies of any default notices received
by Guarantor in respect of any Indebtedness of Guarantor, and (iii) shall
deliver to Lender,

 

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concurrently with the delivery of each annual financial statement required to be
delivered by Guarantor hereunder, a certificate signed by the chief financial
officer of Guarantor setting forth in reasonable detail Guarantor’s Net Worth
and Liquid Assets, based on such financial statement.

 

5.3                               Prohibited Transactions.  Guarantor shall not,
at any time while a default in the payment of the Guaranteed Obligations has
occurred and is continuing beyond any applicable cure period, either (i) enter
into or effectuate any transaction with any Affiliate, including the payment of
any dividend or distribution to a shareholder, or the redemption, retirement,
purchase or other acquisition for consideration of any stock in Guarantor (A)
with the intent to hinder, delay or impede Lender’s exercise of its rights and
remedies available to Lender under the Loan Documents or at law or (B) if the
result of such transaction reduce the Net Worth or Liquid Assets of Guarantor
below the amounts set forth in Section 5.2 hereof, or (ii) sell, pledge,
mortgage or otherwise transfer to any Person any of Guarantor’s assets, or any
interest therein, in either case, (A) with the intent to hinder, delay or impede
Lender’s exercise of its rights and remedies available to Lender under the Loan
Documents or at law or (B) if the result of such activity would reduce the Net
Worth or Liquid Assets of Guarantor below the amounts set forth in Section 5.2
hereof.

 

ARTICLE 6

 

MISCELLANEOUS

 

6.1                               Waiver.  No failure to exercise, and no delay
in exercising, on the part of Lender, any right hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right.  The
rights of Lender hereunder shall be in addition to all other rights provided by
law.  No modification or waiver of any provision of this Guaranty, nor consent
to departure therefrom, shall be effective unless in writing and no such consent
or waiver shall extend beyond the particular case and purpose involved.  No
notice or demand given in any case shall constitute a waiver of the right to
take other action in the same, similar or other instances without such notice or
demand.

 

6.2                               Notices.  All notices, demands, requests,
consents, approvals or other communications (any of the foregoing, a “Notice”)
required, permitted or desired to be given hereunder shall be in writing and
shall be delivered by hand or by reputable overnight courier, addressed to the
party to be so notified at its address hereinafter set forth, or to such other
addresses as such party may hereafter specify in accordance with the provisions
of this Section 6.2.  Any Notice shall be deemed to have been received: (a) on
the date of delivery by hand if delivered during business hours on a Business
Day (otherwise on the next Business Day), and (b) on the next Business Day if
sent by an overnight commercial courier, in each case addressed to the parties
as follows:

 

Guarantor:

Inland Diversified Real Estate Trust, Inc.

 

2901 Butterfield Road

 

Oak Brook, Illinois  60523

 

Attention: Barry Lazarus, President

 

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with a copy to:

The Inland Real Estate Group, Inc.

 

2901 Butterfield Road

 

Oak Brook, Illinois  60523

 

Attention: Robert Baum, Esq., General Counsel

 

 

Lender:

Cantor Commercial Real Estate Lending, L.P.

 

110 East 59th Street, 6th Floor

 

New York, New York 10022

 

Attention:  Jill Weinstein / Don Haber

 

 

with a copy to:

Winston & Strawn LLP

 

200 Park Avenue

 

New York, New York  10166

 

Attention:  Corey A. Tessler, Esq.

 

 

with a copy to:

Midland Loan Services, a Division of PNC Bank, National Association

 

10851 Mastin, Suite 300

 

Overland Park, KS  66210

 

Attention: President

 

Any party may change the address to which any such Notice is to be delivered by
furnishing ten (10) days’ written notice of such change to the other parties in
accordance with the provisions of this Section 6.2.  Notices shall be deemed to
have been given on the date set forth above, even if there is an inability to
actually deliver any Notice because of a changed address of which no Notice was
given or there is a rejection or refusal to accept any Notice offered for
delivery.  Notice for any party may be given by its respective counsel. 
Additionally, Notice from Lender may also be given by any servicer which Lender
empowers to send such Notices on its behalf.

 

6.3                               Governing Law.  (a) This Guaranty shall be
governed in accordance with the terms and provisions of Section 10.3 of the Loan
Agreement.

 

(b)                                 WITH RESPECT TO ANY SUIT, ACTION OR
PROCEEDINGS RELATING TO THIS GUARANTY (EACH, A “PROCEEDING”), GUARANTOR
IRREVOCABLY (A) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE STATE AND
FEDERAL COURTS HAVING JURISDICTION IN THE CITY OF NEW YORK, COUNTY OF NEW YORK
AND STATE OF NEW YORK, AND (B) WAIVES ANY OBJECTION WHICH IT MAY HAVE AT ANY
TIME TO THE LAYING OF VENUE OF ANY PROCEEDING BROUGHT IN ANY SUCH COURT, WAIVES
ANY CLAIM THAT ANY PROCEEDING HAS BEEN BROUGHT IN AN INCONVENIENT FORUM AND
FURTHER WAIVES THE RIGHT TO OBJECT, WITH RESPECT TO SUCH PROCEEDING, THAT SUCH
COURT DOES NOT HAVE JURISDICTION OVER SUCH PARTY.  NOTHING IN THIS GUARANTY
SHALL PRECLUDE LENDER FROM BRINGING A PROCEEDING IN ANY OTHER JURISDICTION NOR
WILL THE BRINGING OF A PROCEEDING IN ANY ONE OR MORE JURISDICTIONS PRECLUDE THE
BRINGING OF A PROCEEDING IN ANY OTHER JURISDICTION.  GUARANTOR FURTHER AGREES
AND CONSENTS THAT, IN ADDITION TO ANY METHODS OF SERVICE OF PROCESS PROVIDED FOR
UNDER APPLICABLE LAW, ALL SERVICE OF PROCESS IN ANY PROCEEDING IN ANY NEW

 

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YORK STATE OR UNITED STATES COURT SITTING IN THE CITY OF NEW YORK AND COUNTY OF
NEW YORK MAY BE MADE BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED,
DIRECTED TO GUARANTOR AT THE ADDRESS INDICATED IN THIS GUARANTY, AND SERVICE SO
MADE SHALL BE COMPLETE UPON RECEIPT; EXCEPT THAT IF GUARANTOR SHALL REFUSE TO
ACCEPT DELIVERY, SERVICE SHALL BE DEEMED COMPLETE FIVE (5) DAYS AFTER THE SAME
SHALL HAVE BEEN SO MAILED.

 

6.4                               Invalid Provisions.  If any provision of this
Guaranty is held to be illegal, invalid, or unenforceable under present or
future laws effective during the term of this Guaranty, such provision shall be
fully severable and this Guaranty shall be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part of this
Guaranty, and the remaining provisions of this Guaranty shall remain in full
force and effect and shall not be affected by the illegal, invalid or
unenforceable provision or by its severance from this Guaranty, unless such
continued effectiveness of this Guaranty, as modified, would be contrary to the
basic understandings and intentions of the parties as expressed herein.

 

6.5                               Amendments.  This Guaranty may be amended only
by an instrument in writing executed by the party or an authorized
representative of the party against whom such amendment is sought to be
enforced.

 

6.6                               Parties Bound; Assignment; Joint and Several. 
This Guaranty shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors, permitted assigns, heirs and
legal representatives.  Lender may sell, assign, pledge, participate, transfer
or delegate, as applicable to one or more Persons all or a portion of its rights
and obligations under this Guaranty in connection with any assignment, sale,
pledge, participation or transfer of the Loan and the Loan Documents.  Any
assignee or transferee of Lender shall be entitled to all the benefits afforded
to Lender under this Guaranty, Guarantor shall not have the right to delegate,
assign or transfer its rights or obligations under this Guaranty without the
prior written consent of Lender, and any attempted assignment, delegation or
transfer without such consent shall be null and void.  If Guarantor consists of
more than one Person or party, the obligations of each such Person or party
under this Guaranty shall be joint and several.

 

6.7                               Headings.  Section headings are for
convenience of reference only and shall in no way affect the interpretation of
this Guaranty.

 

6.8                               Recitals.  The recitals and introductory
paragraphs hereof are a part hereof, form a basis for this Guaranty and shall be
considered prima facie evidence of the facts and documents referred to therein.

 

6.9                               Counterparts.  To facilitate execution, this
Guaranty may be executed in as many counterparts as may be convenient or
required.  It shall not be necessary that the signature of, or on behalf of,
each party, or that the signature of all Persons required to bind any party,
appear on each counterpart.  All counterparts shall collectively constitute a
single instrument.  It shall not be necessary in making proof of this Guaranty
to produce or account for more than a single counterpart containing the
respective signatures of, or on behalf of, each of the parties hereto. Any
signature page to any counterpart may be detached from such counterpart without
impairing

 

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the legal effect of the signatures thereon and thereafter attached to another
counterpart identical thereto except having attached to it additional signature
pages.

 

6.10                        Rights and Remedies.  If Guarantor becomes liable
for any indebtedness owing by Borrower to Lender, by endorsement or otherwise,
other than under this Guaranty, such liability shall not be in any manner
impaired or affected hereby and the rights of Lender hereunder shall be
cumulative of any and all other rights that Lender may ever have against
Guarantor.  The exercise by Lender of any right or remedy hereunder or under any
other instrument, or at law or in equity, shall not preclude the concurrent or
subsequent exercise of any other right or remedy.

 

6.11                        Entirety.  THIS GUARANTY EMBODIES THE FINAL AND
ENTIRE AGREEMENT OF GUARANTOR AND LENDER WITH RESPECT TO GUARANTOR’S GUARANTY OF
THE GUARANTEED OBLIGATIONS AND SUPERSEDES ANY AND ALL PRIOR COMMITMENTS,
AGREEMENTS, REPRESENTATIONS, AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL,
RELATING TO THE SUBJECT MATTER HEREOF.  THIS GUARANTY IS INTENDED BY GUARANTOR
AND LENDER AS A FINAL AND COMPLETE EXPRESSION OF THE TERMS OF THIS GUARANTY, AND
NO COURSE OF DEALING BETWEEN GUARANTOR AND LENDER, NO COURSE OF PERFORMANCE, NO
TRADE PRACTICES, AND NO EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OR DISCUSSIONS OR OTHER EXTRINSIC EVIDENCE OF ANY NATURE SHALL BE
USED TO CONTRADICT, VARY, SUPPLEMENT OR MODIFY ANY TERM OF THIS GUARANTY.  THERE
ARE NO ORAL AGREEMENTS BETWEEN GUARANTOR AND LENDER.

 

6.12                        Waiver of Right To Trial By Jury.  GUARANTOR, AND
LENDER BY ITS ACCEPTANCE OF THIS GUARANTY, HEREBY AGREE NOT TO ELECT A TRIAL BY
JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVE ANY RIGHT TO TRIAL BY JURY
FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH REGARD
TO THIS GUARANTY, THE NOTE, THE LOAN AGREEMENT, THE SECURITY AGREEMENT, OR THE
OTHER LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING IN
CONNECTION THEREWITH.  THIS WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY
AND VOLUNTARILY BY GUARANTOR AND LENDER, AND IS INTENDED TO ENCOMPASS
INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY
JURY WOULD OTHERWISE ACCRUE.  LENDER IS HEREBY AUTHORIZED TO FILE A COPY OF THIS
PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER BY GUARANTOR.

 

6.13                        Cooperation.  Guarantor acknowledges that Lender and
its successors and assigns may (i) sell this Guaranty, the Note and the other
Loan Documents to one or more investors as a whole loan, (ii) participate the
Loan secured by this Guaranty to one or more investors, (iii) deposit this
Guaranty, the Note and the other Loan Documents with a trust, which trust may
sell certificates to investors evidencing an ownership interest in the trust
assets, or (iv) otherwise sell the Loan or one or more interests therein to
investors (the transactions referred to in clauses (i) through (iv) are
hereinafter each referred to as “Secondary Market Transaction”).  Guarantor
shall cooperate with Lender in effecting any such Secondary Market Transaction
and

 

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shall cooperate to implement all customary and reasonable requirements imposed
by any Rating Agencies involved in any Secondary Market Transaction.  Guarantor
shall provide such information and documents relating to Guarantor as Lender may
reasonably request in connection with such Secondary Market Transaction.  In
addition, Guarantor shall make available to Lender all information concerning
its business and operations that Lender may reasonably request.  Lender shall be
permitted to share all such information with the investment banking firms,
Rating Agencies, accounting firms, law firms and other third-party advisory
firms involved with the Loan and the Loan Documents or the applicable Secondary
Market Transaction.  It is understood that the information provided by Guarantor
to Lender including any and all financial statements provided to Lender pursuant
to Section 5.2 hereof may ultimately be incorporated into the offering documents
for the Secondary Market Transaction and thus various investors or potential
investors may also see some or all of the information.  Lender and all of the
aforesaid third-party advisors and professional firms shall be entitled to rely
on the information supplied by, or on behalf of, Guarantor in the form as
provided by Guarantor.  Lender may publicize the existence of the Loan in
connection with its marketing for a Secondary Market Transaction or otherwise as
part of its business development.

 

6.14                        Reinstatement in Certain Circumstances.  If at any
time any payment of the principal of or interest under the Note or any other
amount payable by the Borrower under the Loan Documents is rescinded or must be
otherwise restored or returned upon the insolvency, bankruptcy or reorganization
of the Borrower or otherwise, the Guarantor’s obligations hereunder with respect
to such payment shall be reinstated as though such payment had been due but not
made at such time.

 

6.15                        Gender; Number; General Definitions.  Unless the
context clearly indicates a contrary intent or unless otherwise specifically
provided herein, (a) words used in this Guaranty may be used interchangeably in
the singular or plural form, (b) any pronouns used herein shall include the
corresponding masculine, feminine or neuter forms, (c) the word “Borrower” shall
mean “each Borrower and any subsequent owner or owners of the Property or any
part thereof or interest therein”, (d) the word “Lender” shall mean “Lender and
any subsequent holder of the Note”, (e) the word “Note” shall mean “the Note and
any other evidence of indebtedness secured by the Loan Agreement, as amended,
restated or otherwise modified”, (f) the word “Property” shall include any
portion of the Property and any interest therein, and (g) the phrases
“attorneys’ fees”, “legal fees” and “counsel fees” shall include any and all
reasonable attorneys’, paralegal and law clerk fees and disbursements,
including, but not limited to, fees and disbursements at the pre-trial, trial
and appellate levels, incurred or paid by Lender in protecting its interest in
the Property, the Leases and/or the Rents and/or in enforcing its rights
hereunder.

 

6.16                        No Waiver; Time of Essence.  The failure of any
party hereto to enforce any right or remedy hereunder, or to promptly enforce
any such right or remedy, shall not constitute a waiver thereof nor give rise to
any estoppel against such party nor excuse any of the parties hereto from their
respective obligations hereunder.  Any waiver of such right or remedy must be in
writing and signed by the party to be bound.  This Guaranty is subject to
enforcement at law or in equity, including actions for damages or specific
performance.  Time is of the essence hereof.

 

6.17                        Legal Fees, Costs and Expenses.  Guarantor further
agrees to pay upon demand all costs and expenses reasonably incurred by Lender
or its successors or assigns in connection

 

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with enforcing any of the rights or remedies of Lender, or such successors or
assigns, under or with respect to this Guaranty including, but not limited to,
reasonable attorneys’ fees and the out-of-pocket expenses and disbursements of
such attorneys.  Any such amounts which are not paid within fifteen (15) days of
demand therefor shall bear interest at the Default Rate from the date of demand
until paid.

 

6.18                        Assignments By Lender.  (a) Lender may at its sole
cost and expense, without notice to, or consent of, Guarantor, sell, assign or
transfer to or participate with any entity or entities all or any part of the
indebtedness evidenced by the Note and secured by the Security Instrument, and
each such entity or entities shall have the right to enforce the provisions of
this Guaranty and any of the other Loan Documents as fully as Lender, provided
that Lender shall continue to have the unimpaired right to enforce the
provisions of this Guaranty and any of the other Loan Documents as to so much of
the Loan that Lender has not sold, assigned or transferred.  Lender shall give
notice to Guarantor of the name, address, telephone number and contact person of
any assignee of Lender within a reasonable period of time after the effective
date of the assignment, provided, that failure to provide such notice shall in
no way affect the validity or effect of the assignment or Guarantor’s
obligations hereunder.  In particular, Guarantor acknowledges and agrees that
Lender and its successors and assigns may (i) sell the Loan, this Guaranty and
each of the other Loan Documents to one or more investors as a whole loan in a
rated or unrated public offering or private placement, (ii) grant participation
interests in the Loan, to one or more investors in a rated or unrated public
offering or private placement, (iii) deposit this Guaranty and each of the other
Loan Documents with a trust, which trust may sell certificates to investors
evidencing an ownership in the trust assets in a rated or unrated public
offering or private placement, or (iv) otherwise sell the Loan or any interest
therein to investors in a rated or unrated public offering or private placement.

 

[THE REMAINDER OF THE PAGE IS INTENTIONALLY BLANK]

 

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IN WITNESS WHEREOF, Guarantor has executed this Guaranty the day and year first
above written.

 

GUARANTOR:

INLAND DIVERSIFIED REAL ESTATE TRUST, INC.

 

a Maryland corporation

 

 

 

 

 

By:

/s/ Marcia L. Grant

 

 

Name: Marcia L. Grant

 

 

Title: Assistant Secretary

 

[Signature Page – Guaranty of Recourse Obligations  – Eastern Beltway]

 

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