Exhibit 10.4

 

POST CLOSING AND INDEMNITY AGREEMENT

 

This Post Closing and Indemnity Agreement (“Agreement”) is dated as of this 1st
day of June, 2011 by and among INLAND DIVERSIFIED CHARLOTTE PERIMETER WOODS,
L.L.C., a Delaware limited liability company (“Purchaser”) and PERIMETER WOODS
RETAIL SAE, L.L.C., a North Carolina limited liability company (“Seller”) in
connection with the acquisition of the Perimeter Woods Shopping Center, located
in Charlotte, North Carolina (the “Property”) as legally described in that
certain Purchase and Sale Agreement dated December 23, 2010, as amended (the
“Contract”) by and between Seller and Inland Real Estate Acquisitions, Inc.
(“IREA”).

 

WHEREAS, IREA assigned its interest in the Contract to Purchaser by assignment
dated as  of the date of this Agreement.

 

WHEREAS, Purchaser and/or IREA has made various inquiries regarding the Property
during its due diligence in connection with its acquisition of the Property;

 

WHEREAS, in connection with such inquiries, in order to confirm the status of
various issues that Purchaser deems relevant to its acquisition, Purchaser has
requested certain documents and confirmations from Seller and/or third parties,
but Seller has been unable to either supply a document confirming such matters,
or has asserted that a certain state of facts exist which may be inconsistent
with what is stated in the documents reviewed by Purchaser, or has been unable
to complete a matter due to time constraints;

 

WHEREAS, as a condition precedent to Purchaser proceeding to the Closing (as
defined in the Contract), Purchaser has required and Seller has agreed to
certain undertakings and to obtain documents regarding or confirming certain
issues, and/or certifications as to the state of facts regarding such issues,
and further, Purchaser has required and Seller has agreed that Seller shall
indemnify, defend and hold harmless Purchaser from and against any loss, cost or
expense incurred by Purchaser, including costs and reasonable attorneys fees
incurred as a result of the Indemnified Matters (as hereinafter defined).

 

NOW, THEREFORE, for good and valuable consideration including the mutual
promises contained herein, the parties hereto agree as follows:

 

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The matters hereinafter described in Paragraphs 1 through 11 are collectively
defined as the “Indemnified Matters.”

 

1.                                       ROOF WARRANTY TRANSFER

 

1.1           Seller, at Seller’s sole cost and expense, agrees to (i) execute
all documents and pay all transfer fees and perform all work, if any, necessary
to transfer all roof warranties for the Property in the name of “Inland
Diversified Charlotte Perimeter Woods, L.L.C.,” and (ii) cause the roof
warranties to be delivered to 2901 Butterfield Road, Oak Brook, Illinois 60523,
Attention: Sharon Anderson-Cox. All work, if any, shall be completed and sums
paid and assignment of the roof warranty to Inland Diversified Charlotte
Perimeter Woods, L.L.C. shall be completed not later than seventy-five (75) days
from the date of this Agreement.

 

2.                                       EARNOUT PERIOD

 

2.1           Pursuant to the terms of the Contract, Seller shall have
thirty-six (36) months following the Closing (the “Earnout Period”) to earn the
Unfunded Purchase Price (as defined by the Contract) following the Closing.
During the Earnout Period, Seller and its authorized agents will be given access
to the Property in order to complete all construction, leasing, maintenance,
alterations, and installations related to any earnouts (the “Earnout
Activities”).

 

2.2           Indemnification.  Seller covenants and agrees to indemnify and
hold Purchaser harmless from any and all losses, costs and damages to persons or
property, including actual and reasonable attorneys’ fees and court costs,
incurred as a result of Seller’s Earnout Activities. Seller’s  indemnification
obligations under this section shall expressly include, but not be limited to,
its obligation to indemnify Purchaser for any damages to the Property, any
improvements located thereon, or any other damage that may be caused to persons
or property as a result of Seller’s (or Seller’s contractors, agents, or
employees) Earnout Activities.

 

2.3           Repair and Restoration.  Seller shall, at its sole cost and
expense, promptly repair and restore any portion of the Property that shall be
disturbed, damaged, or destroyed due to or on account of Seller’s Earnout
Activities, to substantially the same condition as existed immediately prior to
the commencement of Seller’s Earnout Activities.

 

2.4           Insurance.  In connection with Seller’s Earnout Activities, Seller
shall, at its sole cost and expense, provide to Purchaser at 2901 Butterfield
Road, Oak Brook, Illinois 60523, Attention: Sharon Anderson-Cox within ten
(10) days from the date of this Agreement, an insurance certificate from
Seller’s insurance provider naming “Inland Diversified Charlotte Perimeter
Woods, L.L.C.” and “Inland Diversified Real Estate Services, L.L.C.” as
additional insureds.

 

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3.                                       CLOSE-OUT/OPERATING MANUALS

 

3.1           Within thirty (30) days from the date of this Agreement, Seller,
at its sole cost and expense, shall have the close-out/operating manual(s) for
the Property forwarded to Purchaser at 2901 Butterfield Road, Oak
Brook, Illinois 60523, Attention: Sharon Anderson-Cox.

 

3.2           Within thirty (30) days from the date of completion of any Earnout
closing, Seller, at its sole cost and expense, shall have the
close-out/operating manual(s) for any earnout space(s) forwarded to Purchaser at
2901 Butterfield Road, Oak Brook, Illinois 60523, Attention: Sharon
Anderson-Cox.

 

4.                                       LEASES AND COMMON AREA MAINTENANCE,
REAL ESTATE TAX AND INSURANCE RECONCILIATIONS (“CAM RECS”)

 

4.1           Within sixty (60) days from the date of this Agreement, Seller, at
its sole cost and expense, shall have all original leases (including lease
amendments) along with originals of all invoices, contracts and bills relating
to CAM RECS for the prior three (3) years from the date of this Agreement for
all completed buildings and all tenancies forwarded to Purchaser at 2901
Butterfield Road, Oak Brook, Illinois 60523, Attention: Sharon Anderson-Cox.

 

5.                                       2010 COMMON AREA MAINTENANCE, REAL
ESTATE TAX AND INSURANCE RECONCILIATIONS

 

5.1           Within ninety  (90) days from the date of this Agreement, Seller
covenants and agrees to fully reconcile all Property tenant CAM RECS for 2010
and all prior periods.  The CAM RECS shall be subject to review and approval by
Purchaser, which approval shall not be unreasonably withheld.  To the extent any
Property tenant has contributed a sum which is greater than its required share
of common area maintenance, real estate tax and insurance contributions (as
determined by the CAM RECS). Seller shall remit that sum to Purchaser no later
than September 1, 2011.  To the extent any Property tenant has contributed a sum
which is less than its required share of common area maintenance, real estate
tax and insurance contributions (as determined by the CAM RECS), Purchaser shall
promptly remit to Seller its portion of tenant CAM RECS remittances as received
by Purchaser from the applicable tenants.  Seller and Purchaser agree to
recalculate the CAM RECS for calendar year 2011 when the CAM RECS are prepared
by Purchaser in 2012.  To the extent Purchaser has received a credit at Closing
from Seller in excess of its allocable share (i.e., January 1, 2011 to the date
of Closing), Purchaser shall reimburse Seller therefor within fifteen (15) days
of the determination of the amount thereof.   To the extent Seller has provided
a credit at Closing to Purchaser which is less than its allocable share (i.e.,
January 1, 2011 to the date of Closing), Seller shall reimburse Purchaser
therefor within fifteen (15) days of the determination of the amount thereof.
Seller and Purchaser agree to reprorate the real estate tax credit provided to
Purchaser at Closing upon issuance of the applicable tax bills and CAM RECS and
payments shall be made by one party to the other in accordance with the terms of
this provision.

 

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6.                                       IMMEDIATE REPAIRS

 

6.1           At Closing, Seller deposited the sum of Fifty-Two Thousand Nine
Hundred Fifty and No/100 Dollars ($52,950.00) into an escrow with Escrow Agent
(as defined in the Contract) (the “Immediate Needs Repair Escrow”) as security
for any immediate needs repairs that are required at the Property.  Within sixty
(60) days from the date of this Agreement, Seller, at Seller’s sole cost and
expense, shall repair the immediate repair issues identified on Exhibit “A”
attached hereto and incorporated herein (the “Immediate Repairs”).  Upon
completion of the Immediate Repairs by Seller to Purchaser’s commercially
reasonable satisfaction, the funds deposited in the Immediate Needs Repair
Escrow shall be immediately released by Escrow Agent to Seller.

 

7.                                       3.14 AUDITS

 

7.1           Seller agrees to cooperate, at Seller’s sole cost and expense,
with Purchaser’s auditor, KPMG, after Closing to complete the 3.14 audit.

 

8.                                       APPROVAL OF DEVELOPMENT OF TRACT 9

 

8.1.          Within thirty (30) days from the date of this Agreement, Purchaser
shall review and respond to Seller’s request for  approval of development of
Tract 9 at the Office Park at  Perimeter Woods, Charlotte, North Carolina per
the suggested approval document previously sent to Purchased and attached hereto
as Exhibit “B” (the “Approval Document”). The parties agree to negotiate in good
faith in finalizing the Approval Document.

 

9.                                       OFFICE MAX ESTOPPEL

 

9.1.          The Office Max estoppel letter describes the following issue:
(i) right to review 2009 real estate taxes which has been billed two revisions
(the “Office Max Estoppel Issue”).  Seller covenants and agrees, at Seller’s
sole cost and expense, to resolve the Office Max Estoppel Issue to the
satisfaction of Office Max within thirty (30) days of the execution date of this
Agreement. Correction of the Office Max Estoppel Issue shall be evidenced by an
estoppel update issued by Office Max acknowledging that the Office Max Issue has
then been resolved to its satisfaction.

 

10.                                 INTENTIONALLY OMITTED

 

11.                                 REVISED SURVEY

 

11.1         Within thirty (30) days from the date of this Agreement, Seller, at
Seller’s sole cost and expense, shall obtain an updated survey of the Property
delineating where the building height of the BB&T building ends and where the
architectural features of the BB&T building begin and shall cause the revised
survey to Purchaser at 2901 Butterfield Road, Oak Brook, Illinois 60523,
Attention:

 

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Sharon Anderson-Cox.

 

12.                                 SURVIVAL

 

12.1         The terms and provisions of this Agreement shall expressly survive
the Closing.

 

13.                                 REMEDIES.

 

13.1.        The remedies and indemnities set forth herein are in addition to
all rights of Purchaser as set forth in the Contract.

 

14.                                 FURTHER ASSURANCES.

 

14.1.        Seller and Purchaser agree to cooperate with each other following
the Closing to confirm any matter and execute any document reasonably required
by the other party in furthering of the Closing and consistent with the
requirements of this Agreement.

 

15.                                 DEFINED TERMS.

 

15.1.        All capitalized terms which are not expressly defined herein shall
have the meanings set forth in the Contract.

 

16.                                 INDEMNIFICATION.

 

16.1.          In order to induce Purchaser to close upon the acquisition of the
Property, notwithstanding the matters described by this Agreement, Seller has
agreed to indemnify, defend and hold harmless Purchaser, and its successors and
assigns and lenders (each an “Indemnified Party” and collectively, the
“Indemnified Parties”) harmless from any loss, cost or expense incurred by any
Indemnified Party, including legal costs and reasonable attorneys’ fees
(collectively, “Loss”) incurred as a result of the Indemnified Matters.  Seller
hereby agrees to indemnify, defend and hold harmless the Indemnified Parties
from and against any Loss as a result of Seller’s failure to obtain the required
documents or complete its obligations under this Agreement or any Loss that
results from an act or acts undertaken to cause the issues described herein to
be corrected, except in each case to the extent such Loss arises from the
negligence or willful misconduct of Purchaser.  Seller shall further indemnify
and hold Purchaser harmless from and against any and all cost, expense,
liability or damage arising out of: (i) any injury to any person or the Property
attributable to Seller’s exercise of any of its rights hereunder; and (ii) any
liens filed against the Property or claims or demands made against Purchaser or
the Property for work performed by or on the behalf of Seller pursuant to this
Agreement, except in each case to the extent such Loss arises from the
negligence or willful misconduct of Purchaser.

 

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17.                                 MISCELLANEOUS.

 

17.1.          This Agreement shall be binding upon and inure to the benefit of
the parties to this Agreement and their respective successors and permitted
assigns.

 

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IN WITNESS WHEREOF, the parties have executed this Post Closing and Indemnity
Agreement effective the first date written above.

 

Seller:

 

PERIMETER WOODS RETAIL SAE, LLC, a North Carolina limited liability company

 

By: PERIMETER WOODS DEVELOPMENT, LLC, its Manager

 

By:

/s/ John Collett

 

Name: John Collett

 

Its: Manager

 

 

Purchaser:

 

INLAND DIVERSIFIED CHARLOTTE PERIMETER WOODS, L.L.C.,

a Delaware limited liability company

 

By:

Inland Diversified Real Estate Trust, Inc., its sole member

 

 

 

 

By:

/s/ Sharon Anderson-Cox

 

Name:

Sharon Anderson-Cox

 

Its:

Authorized Agent

 

 

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EXHIBIT “A”

 

IMMEDIATE REPAIR NEEDS

 

[See attached]

 

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EXHIBIT “B”

 

THE APPROVAL DOCUMENT

 

[See attached]

 

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APPROVAL OF INLAND IN CAPACITY AS MEMBER OF ARC PERTAINING TO DEVELOPMENT OF
TRACT 9 UNDER MASTER DECLARATION

 

THIS APPROVAL OF INLAND IN CAPACITY AS MEMBER OF ARC PERTAINING TO DEVELOPMEBT
OF TRACT 9 UNDER MASTER DECLARATION (this “Consent”), is made as of the
            day of June, 2011, by and between PERIMETER WOODS RETAIL SAE, LLC, a
North Carolina limited liability company (“PWRS”) and PERIMETER WOODS
DEVELOPMENT, LLC (“PWD” and together with PWRS collectively referred to as
“Developer”) and INLAND DIVERSIFIED CHARLOTTE PERIMETER WOODS,  L.L.C., a
Delaware limited liability company, and its successors and assigns
(collectively, “Inland”).

 

W I T N E S S E T H:

 

WHEREAS, Developer is conveying the Property more particularly described on
Exhibit A attached hereto and by this reference made a part hereof to Assignee
by two (2) Special Warranty Deeds recorded of even date herewith but prior to
this Assignment;

 

WHEREAS, concurrently herewith, John Collett has resigned as a member of
Architectural Review Committee (“ARC”) pertaining to one (1) of three
(3) positions on the ARC under the Master Declaration (hereafter defined). Such
resignation is applicable to that membership position appointed by the Developer
under the Master Declaration as such terms are defined in that certain Master
Declaration of Covenants, Easements and Restrictions recorded in Book 20339,
Page 506, Mecklenburg County Public Registry, North Carolina, as amended by that
certain First Amendment to Master Declaration of Covenants, Easements and
Restrictions recorded in Book 21166, Page 166, Mecklenburg County Public
Registry, North Carolina as further amended by that certain Second Amendment to
Master Declaration of Covenants, Easements and Restrictions recorded in Book
                      , Page                           , Mecklenburg County
Public Registry, North Carolina (collectively, the “Master Declaration”);

 

WHEREAS, concurrently herewith, Inland as been designated and approved as a
member of the ARC in place of John Collett; and

 

WHEREAS, the Phase II Office Tract (“Tract 9”) is governed by the Master
Declaration as to certain matters, including, without limitation, the
requirement of obtaining approval from the ARC regarding any development and
Improvements place on such Tract 9;

 

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WHEREAS, Tract 9 is presently vacant land; and

 

WHEREAS, Inland desires to approve the initial future development of Tract 9 in
its capacity as a member of the ARC.

 

NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto, intending to be
legally bound hereby, covenant and agree as follows:

 

1.             Inland hereby approves any development and Improvements on Tract
9 in its capacity as a member of the ARC under the Master Declaration (the
“Inland Approval”).  Without limitation, such Inland Approval includes final
plans and specifications, conceptual drawings, preliminary site plan (including
parking and setbacks), representative elevations, representative elevations,
representative exterior materials, landscaping, and signage elevations
(collectively the “Plans”).

 

2.             Developer understands and agrees that at least one (1) other
member of the ARC must approve the Plans in addition to Inland and that any such
development and Improvements must comply with all appropriate governmental laws
and regulations applicable to such development and Improvements.

 

3.             At such time as Tract 9 has been developed as evidenced by a
certificate of occupancy, then any subsequent redevelopment of Tract 9 shall
require the approval of the ARC as set forth in the Master Declaration and there
shall be no deemed Inland Approval.

 

4.             Capitalized terms not otherwise defined herein shall have the
meaning given to them in the Master Declaration.

 

5.             The provisions of this Consent shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns.

 

[THIS SPACE INTENTIONALLY LEFT BLANK — EXECUTIONS APPEAR ON FOLLOWING PAGES]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be duly
executed as of the day and year first above written.

 

DEVELOPER:

 

PERIMETER WOODS RETAIL SAE, LLC,

a North Carolina limited liability company

 

By:

Perimeter Woods Development, LLC, a North Carolina limited liability company

 

Its:

Manager

 

 

 

 

 

By:

 

 

 

Name:

John Collett

 

 

Its:

Manager

 

 

 

PERIMETER WOODS DEVELOPMENT, LLC, a North

Carolina limited liability company

 

By:

 

 

Name:

John Collett

 

Its:

Manager

 

 

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INLAND:

 

INLAND DIVERSIFIED CHARLOTTE NORTHCREST, L.L.C.,

a Delaware limited liability company

 

By:

Inland Diversified Real Estate Trust, Inc.,

 

a Maryland corporation, its sole member

 

 

By:

 

 

Name:

 

 

Its:

 

 

 

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Exhibit  A

 

LEGAL DESCRIPTION

 

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