Document:

Exhibit 10.28

 

PARENT GUARANTY

 

THIS PARENT GUARANTY (this “Guaranty”), entered into as of this 29th day
of December, 2003, by OCULAR SCIENCES, INC., a Delaware- corporation
(together with its permitted successors, assigns and transferees, “Guarantor”),
for the benefit of WELLS FARGO HSBC TRADE BANK N.A., a national banking
association (together with its successors, assigns and transferees, “Bank”),
and with respect to that certain Credit Agreement of even date herewith (as
amended, modified or supplemented from time to time, the “Credit Agreement”)
between Bank and OCULAR SCIENCES K.K., a Japanese corporation (together with its permitted successors,
assigns and transferees, “Borrower”).

 

W I T N E S S E T H:

 

WHEREAS, Borrower is a wholly owned Subsidiary of Guarantor; and

 

WHEREAS, it is a condition precedent to the effectiveness of the Loan
Documents that Guarantor shall have executed and delivered to Bank this
Guaranty:

 

NOW, THEREFORE, in order to induce Bank to execute and deliver the Loan
Documents, and for other good and valuable consideration, the receipt of which
is hereby acknowledged, Guarantor hereby covenants and agrees with Bank as
follows:

 

1.             Definitions.  The following terms when used in this
Guaranty, including its preamble and recitals, shall have the following
meanings (such definitions to be equally applicable to the singular and plural
forms thereof).  All capitalized terms
not defined herein shall have the meaning set forth in the Credit Agreement.

 

“Accommodation
Obligation” means, as applied to any Person, any direct or indirect
guaranty, endorsement or other liability of that Person with respect to any
Debt, lease, dividend, letter of credit or other obligation (the “primary
obligation”) of another Person (the “primary obligor”), including any
obligation of that Person, whether or not contingent, (i) to purchase,
repurchase or otherwise acquire any such primary obligation or any property
constituting direct or indirect security therefor; (ii) to advance or
provide funds (A) for the payment or discharge of any such primary
obligation, or (B) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet item, level of income or financial condition of the primary
obligor; (iii) to purchase property, securities or services primarily for
the purpose of assuring the owner of any such primary obligation of the ability
of the primary obligor to make payment of such primary obligation; or
(iv) otherwise to assure or hold harmless the holder of any such primary
obligation against loss in respect thereof. The amount of any Accommodation
Obligation shall be deemed to be an amount equal to the maximum stated or determinable amount of the primary obligation in
respect of which such Accommodation Obligation is made or, if not stated or if
indeterminable, the maximum reasonably estimated potential 

 

 

liability in respect thereof. Endorsements of checks for
collection or deposit in the ordinary course of business are not Accommodation
Obligations.

 

“Authorized
Officer” means the chief executive officer, president, chief financial
officer or controller of Guarantor.

 

“Bank”
has the meaning given it in the preamble.

 

“Borrower”
has the meaning given it in the preamble.

 

“Capital Lease” means, with respect to any Person, any
lease of any property by that Person as lessee which, in accordance with GAAP,
is required to be accounted for as a capital lease on the balance sheet of that
Person.

 

“Cash Flow” means, for any period, an
amount determined as (i) Consolidated Net Income for such period, plus (ii) to the extent
deducted in determining Consolidated Net Income and without duplication, the
sum of (A) all charges for Consolidated Interest Expense, depreciation and
amortization for such period, plus (B) all non-cash charges required by
GAAP relating to dispositions of property, plant and equipment for such period,
minus (iii) preferred stock dividends paid or payable (x) by
Guarantor or (y) by any of its consolidated Subsidiaries to any Person not
in the Ocular Sciences Group during such period and minus (iv) amounts
and/or expenditures incurred in connection with stock repurchases and/or
buybacks by Guarantor during such period, all computed and calculated in
accordance with GAAP.

 

“Cash Flow Coverage Ratio” means, as
of any date of determination, (a) Cash Flow, divided by (b) the sum
of the current portion of long-term debt and Capital Leases following the
relevant date of calculation.

 

“Consolidated Interest Expense” means,
for any period, total interest expense (including the interest component of Capital Leases) of Guarantor and its
consolidated Subsidiaries for such period determined in accordance with GAAP,
except that amortization or write-off of original issue discount, capitalized
debt issuance costs and expenses, and non-cash interest payments or accruals
shall in any event be excluded.

 

“Consolidated Net Income” means, for
any period, the net income of Guarantor and its consolidated Subsidiaries for
such period determined in accordance with GAAP.

 

“Consolidated Total Debt” means, as of
any date of determination for Guarantor and its consolidated Subsidiaries, all
items of indebtedness,
obligation or liability (other than Subordinated Debt) that should be
classified, and reported on Guarantor’s consolidated balance sheet, as
liabilities in accordance with GAAP.

 

“Credit
Agreement” has the meaning given it in the preamble.

 

2

 

“Debt” means, as applied to any
Person, (i) all indebtedness of such Person for borrowed money (whether by
loan or the issuance of debt securities or otherwise); (ii) all
obligations of such Person issued, undertaken or assumed as the deferred
purchase price of property or services or interest thereon, except accounts and
accrued expenses currently payable; (iii) all reimbursement obligations of
such Person with respect to surety bonds, letters of credit, bankers’
acceptances and similar instruments, whether or not contingent; (iv) all
monetary obligations of such Person under any Capital Lease; (v) all
obligations of such Person (contingent or otherwise) to purchase, retire or
redeem any capital stock or other equity interests in such Person or any
Affiliate of such Person; (vi) all monetary obligations of such Person
measured by, or determined on the basis of, the value of any capital stock of
such Person or any Affiliate of such Person; (vii) all Accommodation
Obligations of such Person; and (viii) all liabilities and obligations
secured by (or as to which the holder of the liability or obligation has an
existing right, contingent or otherwise, to be secured by any Lien, except a
Non-Consensual Lien (as such term is defined in the Parent Credit Agreement as
in effect on the date hereof).

 

“Earnings
Before Interest and Taxes” means
the consolidated earnings (or loss) from the operations of any Person for any
period, after all expenses and other property charges but before payment or
provision for any income taxes or interest expense for such period, determined in
accordance with GAAP, excluding any extraordinary or non-recurring gains
or losses.

 

“EBITDA” means, for any period, an
amount equal to the sum of (a) Earnings Before Interest
and Taxes for Guarantor and its Subsidiaries on a consolidated basis for such
period, plus (b) depreciation, amortization and all other non-cash charges
of Guarantor and its Subsidiaries on a consolidated basis for such period.

 

“Equity Issuance” means the issuance
or sale of any capital stock or other equity, ownership or profit interests
(except a dividend on any such stock or interest declared and payable solely in
additional shares of such stock or interest) by (i) Guarantor to any
Person, or (ii) any Subsidiary of Guarantor to any Person, other than to
Guarantor or to any other wholly owned Subsidiary of Guarantor.

 

“ERISA Affiliate” has the meaning
given it in the Parent Credit Agreement as in effect on the date hereof.

 

“ERISA Event” has the meaning given it
in the Parent Credit Agreement as in effect on the date hereof.

 

“Fiscal
Quarter” means a fiscal quarter of
Guarantor.

 

“Fiscal
Quarter End Date” means the last day of a Fiscal Quarter.

 

“Fiscal Year”
means a fiscal year of Guarantor.

 

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“GAAP” means
generally accepted accounting principles set forth in the opinions and
pronunciations of the Accounting Principles Board and American Institute of
Certified Public Accountants and statements and pronunciations of the Financial
Accounting Standard Board (or agencies with similar functions of comparable
stature and authority within the accounting profession), or in such other
statements by such entity as may be in general use by significant segments of
the U.S. accounting profession, which are applicable to the facts and circumstances
on the date of determination.

 

“Guaranteed
Obligations” has the meaning given it in Section 2.1 hereof.

 

“Guarantor”
has the meaning given it in the preamble.

 

“Guaranty”
has the meaning given it in the preamble.

 

“Intangible Assets” means, as of any
date of determination for Guarantor and its consolidated Subsidiaries in
accordance with GAAP, assets having no physical existence and that should be
classified as intangible assets, including, without limitation, goodwill,
patents, patent rights, trademarks, trade names, franchises, copyrights,
licenses, organizational expenses and deferred charges (including, without
limitation, unamortized debt issuance costs).

 

“Interest”
means all or any of the right, title or interest and obligations of Bank in and
to the Loan Documents, and all or any of the benefits, advantages and
obligations of Bank under the Loan Documents.

 

“Interest
Coverage Ratio” means the consolidated Earning Before
Interest and Taxes of any Person for any period, divided by Consolidated Interest
Expense of such Person during such period.

 

“Investment”
has the meaning set forth in the Parent Credit Agreement as in effect on the
date hereof.

 

“Laws and
Permits” has the meaning given it in Section 3(b).

 

“Material
Adverse Change” means any materially adverse change in the financial
condition, assets, liabilities, business, operations or prospect of Guarantor
and its Subsidiaries, taken as a whole.

 

“Multiemployer
Plan” has the meaning given it in
the Parent Credit Agreement as in effect on the date hereof.

 

“Ocular Sciences Group” means, collectively, Guarantor and its Subsidiaries.

 

“Parent Credit Agreement” means a
Credit Agreement dated as of April 16, 2002 among Guarantor, as borrower,
the lenders referred to therein and Comerica Bank-California as the agent for
the lenders, as may be amended from time to time.

 

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“Parent Pledge Agreement” means a
Pledge Agreement executed by
Guarantor and delivered pursuant to Section 3.1 (a) of the Parent Credit
Agreement and each joinder therein by any Subsidiary of Guarantor in accordance
with the provisions of the Parent Credit Agreement.

 

“Permitted Cash Investments” means
(i) certificates of deposit or money market securities with maturities of
three years or less issued by
any United States, Australian, Canadian, Japanese or European commercial bank
with capital, surplus and undivided profits of $500,000,000 or more;
(ii) obligations issued by, or guaranteed by, the United States government
and maturing within three years from the date of acquisition thereof;
(iii) commercial paper, municipal bonds and similar instruments with
maturities of three years or less rated at least P-1 or A-3, respectively, by
Moody’s Investors Service, Inc., or rated at least A-1 or A, respectively, by
Standard & Poor’s Corporation, or receiving an equivalent rating from
any other nationally recognized rating agency; (iv) repurchase or reverse
repurchase agreements issued by any United States commercial bank with capital
surplus and undivided profits of $500,000,000 or more; and (v) investments
in money market funds or mutual funds that invest solely in investments
described in clauses (i) through (iv).

 

“Person”
means any individual, partnership, joint venture, firm, corporation, association,
limited liability company, trust or other enterprise.

 

“Prohibited
Asset Sale” means the sale, sale-leaseback, conveyance license, transfer or
other disposition, whether direct or indirect, of any asset, business or
property of Guarantor or any of its Subsidiaries, other than (i) sales and
other dispositions of inventory in the ordinary course of business;
(ii) sale of used, worn-out or surplus equipment in which the proceeds are
either (x) reinvested in other fixed assets within one hundred eighty
(180) days from the date of sale or (y) applied to prepay amounts
owed Bank under the Credit Agreement; (iii) sales and leasebacks of
equipment acquired by Guarantor or any of its Subsidiaries not more than one
hundred eighty (180) days prior to such sale or leaseback;
(iv) non-exclusive licenses and similar arrangements for the use of
intellectual property of Guarantor or any of its Subsidiaries;
(v) transfers of assets between Subsidiaries of Guarantor, or from any
Subsidiary of Guarantor to Guarantor; and (vi) the sale, lease, transfer
or other disposition of assets by Guarantor and its Subsidiaries, up to a
maximum amount of $2,000,000 in any calendar year.

 

“Property”
has the meaning given it in Section 3(b).

 

“Quick Ratio”
means, as of any Fiscal Quarter End Date for Guarantor and its Subsidiaries,
the ratio of (i) the sum of unrestricted cash, PLUS unrestricted Permitted
Cash Investments, PLUS trade accounts receivable (net of applicable reserves
therefor), DIVIDED BY (ii) the sum of current liabilities, PLUS (without
duplication) the aggregate principal amount of the “Revolving Advances” or
“Term Advances” (as each such term is defined in the “Parent Credit 

 

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Agreement”) outstanding under the Parent Credit Agreement, in each
case as of such Fiscal Quarter End Date.

 

“Subordinated Debt” means any Debt of Guarantor or any of its Subsidiaries
which is subordinate to the Obligations (as such term is defined in the Parent
Credit Agreement) having terms and conditions satisfactory to the “Required
Lenders” (as such term is defined in the Parent Credit Agreement).

 

“Subsidiary” means, with respect to any Person, any corporation, association,
partnership, joint venture or other business entity of which more than fifty
percent (50%) of the voting stock or other equity interests is owned or
controlled directly or indirectly by such Person or one or more Subsidiaries of
such Person or a combination thereof.

 

“Tangible
Effective Net Worth” means, as of any date of determination for Guarantor
and its consolidated Subsidiaries in accordance with GAAP, the amount
determined as (i) the
net book value of all assets (other than Intangible Assets) after all
appropriate deductions which are either required or reflected by Guarantor in
its consolidated balance sheet (including, without limitation, reserves for
doubtful receivables, returns, obsolescence, depreciation and amortization),
MINUS (ii) Consolidated
Total Debt, PLUS (iii) Subordinated
Debt.

 

“Total
Funded Debt” means, at the relevant
calculation date, the aggregate amount of all Debt of Guarantor and its consolidated Subsidiaries relating to (i) the
borrowing of money or obligations under letters of credit or (ii) in
respect of Capital Leases outstanding during such period.

 

2.             Guaranty Provisions.

 

2.1           Guaranteed
Obligations.  Guarantor hereby
absolutely, unconditionally and irrevocably guarantees:

 

(i)            the
full and prompt payment when due (whether at the stated maturity, by
acceleration or otherwise) of all obligations (including obligations which, but
for the automatic stay under section 362(a) of the Bankruptcy Code, would
become due) and liabilities of Borrower incurred under the Credit Agreement and
other Loan Documents, now existing or hereafter incurred under, arising out of
or in connection with the Credit Agreement and other Loan Documents, and the
due performance and compliance by Borrower with the terms of the Credit
Agreement and other Loan Documents; and

 

(ii)           all costs, fees, expenses and other amounts set forth in
Section 11.2 hereof or any other provisions of this Guaranty;

 

all such obligations,
liabilities, sums and expenses set forth in clauses (i) and (ii) of
this Section 2.1 being collectively called the “Guaranteed Obligations,” it
being acknowledged and agreed that the “Guaranteed Obligations” shall include
Loans made under the Loan Documents, whether made on the date of this Guaranty
or from time to time after the date of this Guaranty.

 

6

 

2.2           Guaranty
of Payment.  This Guaranty
constitutes a guaranty of payment when due and not merely of collection, and
Guarantor specifically agrees that it shall not be necessary or required that
Bank exercise any right, assert any claim or demand or enforce any remedy
whatsoever against Borrower (or any other Person) or any property before or as
a condition to the obligations of Guarantor hereunder.

 

2.3           Guaranty
Absolute, etc.  This Guaranty shall
in all respects be a continuing, absolute, unconditional and irrevocable
guaranty of payment, and shall remain in full force and effect until all of the
Guaranteed Obligations have been absolutely, irrevocably and unconditionally
fulfilled, performed or met, whether by Guarantor, Borrower or other Person.  Guarantor guarantees that the Guaranteed
Obligations will be paid strictly in accordance with the terms of the Loan
Documents under which they arise, regardless of any law, regulation or order
now or hereafter in effect in any jurisdiction affecting any of such terms or
the rights of Bank. Without limiting the foregoing, the liability of Guarantor
under this Guaranty shall be absolute, unconditional and irrevocable, to the
fullest extent permitted by applicable laws irrespective of:

 

(a)           any
lack of validity, legality or enforceability of the Loan Documents or any lack
of capacity or change in status of Borrower (including, without limitation, any
bankruptcy reorganization, insolvency, merger, consolidation, liquidation or
other proceeding or event relating to Borrower);

 

(b)           any
exercise of, or any election not or failure to exercise, delay in the exercise
of, waiver of, or forbearance or other indulgence with respect to, any right,
remedy or power available to Bank, including (i) any election not or
failure to exercise any right of setoff, recoupment or counterclaim,
(ii) any election of remedies effected by Bank, including the foreclosure
upon any real estate constituting collateral, whether or not such election
affects the right to obtain a deficiency judgment, and (iii) any election
by Bank in any proceeding under the Bankruptcy Code of the application of
section 1111(b)(2) of such Code;

 

(c)           any change in the time, manner or place of payment of, or in
any other term of, all or any of the Guaranteed Obligations, or any other
increase, decrease, prepayment, extension, compromise or renewal of any
Guaranteed Obligation;

 

(d)           any
increase, reduction, limitation, impairment or termination of the Guaranteed
Obligations for any reason (other than payment), including any claim of waiver,
release, surrender, alteration or compromise, and shall not be subject to (and
Guarantor hereby waives any right to or claim of) any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the invalidity,
illegality, nongenuineness, irregularity, compromise, unenforceability of, or
any other event or occurrence affecting, the Guaranteed Obligations;

 

(e)           any amendment to, rescission, waiver, or other modification
of, or any consent to a departure from, any of the terms of the Loan Documents;

 

(f)            any
addition, exchange, release, surrender or nonperfection of any collateral, or
any amendment to or waiver or release or addition of, or consent to a departure
from, any other guaranty, provided in favor of Bank in connection with the
Guaranteed Obligations; or

 

7

 

(g)           any other circumstance which might otherwise constitute a
defense available to, or a legal or equitable discharge of, Guarantor, any
surety or any guarantor.

 

2.4           Reinstatement,
etc.  Guarantor agrees that this
Guaranty shall continue to be effective or be reinstated, as the case may be,
if at any time any payment (in whole or in part) of any of the Guaranteed
Obligations is rescinded or must otherwise be restored by Bank, upon the
insolvency, bankruptcy or reorganization of Guarantor, Borrower or otherwise,
as though such payment had not been made.

 

2.5           Rights
and Remedies.  Guarantor waives any
and all rights under section 2845 of the California Civil Code or any other
provision of any other applicable law to require Bank to (a) proceed
against Borrower; (b) proceed against or exhaust any security held from
Borrower; or (c) pursue any other remedy in
Bank’s power whatsoever.  Bank may, at
its election, exercise any right or remedy it may have against Guarantor or any
security now or hereafter held by or for the benefit of Bank including, without
limitation, the right to foreclose upon any such security by judicial or
nonjudicial sale, without affecting or impairing in any way the liability of
Guarantor hereunder except to the extent the Guaranteed Obligations may thereby
be paid, even though any rights which Guarantor may have or otherwise might
obtain by subrogation against others might be diminished or destroyed.  Guarantor waives all rights and defenses
arising out of an election or non-election of remedies by Bank, even though
that election or non-election of remedies, such as a nonjudicial foreclosure
with respect to security for a guaranteed obligation, has destroyed Guarantor’s
rights of subrogation and reimbursement against the principal by the operation
of section 580d of the California Code of Civil Procedure.  Guarantor acknowledges that any such exercise
or non-exercise of a right or remedy with respect to any collateral security
for the Guaranteed Obligations may result in a loss, in part or whole, of
Bank’s right to collect from Borrower any deficiency that may remain after any
such exercise of such a right or remedy and that, where such a loss occurs, Guarantor
will also suffer a loss of any rights and remedies, arising in law or equity,
which Guarantor may have to collect any amount from Borrower; and Guarantor
agrees to remain bound notwithstanding any such loss.  Only the net proceeds from any such foreclosure,
after deduction of all costs and expenses authorized to be deducted pursuant to
the documents under which such security is held or by law, shall be applied
against the Guaranteed Obligations.  Bank
may at its discretion purchase all or any part of such security so sold or
offered for sale for its own account and may apply against the amount bid
therefor all or any part of the Guaranteed Obligations for which such security
is held; and in such case, only that portion of the Guaranteed Obligations so
applied, after deduction of all costs and expenses authorized to be deducted
pursuant to the documents under which such security is held or by law, shall be
applied against the Guaranteed Obligations. 
Guarantor waives any defense arising out of the absence, impairment or
loss of any right of reimbursement or subrogation or other right or remedy of
Guarantor against Borrower or any such security, whether resulting from the
election by Bank to exercise any right or remedy it may have against Borrower,
any defect in, failure of, or loss or absence of priority with respect to
Bank’s interest in such security, or otherwise. 
In the event that any fore-closure sale is deemed to be not commercially
reasonable, Guarantor waives any right that it may have to have any portion of
the Guaranteed Obligations discharged except to the extent of the amount
actually bid and received by Bank at any such sale.  Bank shall not be required to institute or
prosecute proceedings to recover any deficiency as a condition of payment
hereunder or enforcement hereof.

 

8

 

2.6           Separate
Guaranteed Obligation.  The
obligations hereunder are independent of the obligations of Borrower, and a
separate action or actions may be brought and prosecuted against Guarantor
whether action is brought against Borrower or whether Borrower be joined in any
such action or actions; Guarantor waives the benefit of any statute of
limitations affecting its liability hereunder or the enforcement thereof, to
the fullest extent permitted by law.  Any
part performance of the Guaranteed Obligations by Borrower or other
circumstances which operate to toll any statute of limitations as to Borrower
shall not operate to toll the statute of limitations as to Guarantor.  Guarantor hereby waives any rights it may
have under sections 2809 and 2810 of the California Civil Code and reaffirms
that, in any event, the obligations of Guarantor are independent of those of
Borrower.  Guarantor understands that
Bank would not have entered into the transaction with Guarantor in the absence
of the foregoing covenants by Guarantor and the other covenants of Guarantor
contained in this Guaranty.

 

2.7           Covenant
To Prevent Events of Default. 
Guarantor covenants and agrees that on and after the date hereof until
such time as (i) each of the Loan Documents is terminated in its entirety
and no provision thereof remains in force and effect and (ii) all
outstanding payments and obligations arising therefrom or from this Guaranty,
including, without limitation, the Guaranteed Obligations, have been paid in
full, Guarantor shall take, or refrain from taking, as the case may be, all
actions that are necessary to be taken or not taken so that no violation of any
provision, covenant or agreement contained in the Loan Documents, and so that
no Event of Default, is caused by the actions or failure to act of Guarantor or
Borrower.

 

2.8           Waiver
of Notices and Demands.  Guarantor
waives all presentments, demands for performance, notices of nonperformance,
protests, notices of protest, notices of dishonor, notices of default, and
notices of acceptance of this Guaranty and of the existence, creation or
incurring of new or additional Guaranteed Obligations.  At the option of Bank, Guarantor may be
joined in any action or proceeding commenced by Bank against Borrower in
connection with or based upon the Guaranteed Obligations or any security
therefor and recovery may be had against Guarantor in such action or
proceeding, without any requirement that Bank first assert, prosecute or
exhaust any remedy or claim against Borrower. 
Without limiting the foregoing, Guarantor acknowledges that repeated and
successive demands may be made and payments or performance made hereunder in
response to such demands as and when, from time to time, Borrower may default
in performance of the Guaranteed Obligations. 
Notwithstanding any such performance hereunder, this Guaranty shall
remain in full force and effect and shall apply to any and all subsequent
defaults by Borrower in payment or performance of the Guaranteed Obligations.

 

2.9           Waiver
of Defenses.  Guarantor waives any
defense arising by reason of any disability or other defense of Borrower or by
reason of the cessation from any cause whatsoever of the liability of
Borrower.  Guarantor waives any setoff,
recoupment, defense or counterclaim which Borrower or Guarantor may have or
claim to have against Bank. Guarantor waives any and all rights under
California Civil Code sections 2787 through 2855.  All payments due to Bank hereunder shall be
made without any reduction or deduction whatsoever, including any reduction or
deduction for taxes (except for any withholding or deduction for taxes required
to be withheld or deducted under applicable law).

 

9

 

2.10         Right
of Subrogation.  Notwithstanding any
payment or payments made by Guarantor hereunder or any setoff or application of
funds of Guarantor by Bank, Guarantor shall not be entitled to be subrogated to
any of the rights of Bank against Borrower or any other Person or any
collateral security or Guaranty or right of offset held by Bank for the payment
of the Guaranteed Obligations, nor shall Guarantor, in its capacity as
Guarantor, seek or be entitled to seek any contribution or reimbursement from
Borrower or any other Person in respect of payments made by Guarantor hereunder
until all the Guaranteed Obligations have been absolutely, irrevocably,
indefeasibly and unconditionally fulfilled, performed or met.  If any amount shall be paid to Guarantor on
account of such subrogation rights at any time when all of the Guaranteed
Obligations and all amounts owing hereunder shall not have been paid in full,
such amount shall be held by Guarantor in trust for Bank, segregated from other
funds of Guarantor, and shall, forthwith upon receipt by Guarantor, be turned
over to Bank in the exact form received by Guarantor (duly indorsed by
Guarantor to Bank, if required), to be applied against the Guaranteed
Obligations, whether matured or unmatured, in such order as Bank may determine.

 

2.11         Transfers
of Interests, etc.  This Guaranty
shall inure to the benefit of and be enforceable by Bank.  Without limiting the generality of Section
11.1, Bank may assign or otherwise transfer (in whole or in part) any Interest
held by it to any other Person, and such other Person shall thereupon become
vested with all rights and benefits in respect thereof granted to Bank under
the Loan Documents and this Guaranty or otherwise.

 

2.12         Time,
Place and Manner of Payments by Guarantor. 
(1)  All payments due to Bank hereunder shall be made to Bank
at the time and place and in the manner specified under Section 1.09 of the
Credit Agreement.

 

(a)           In the
case of each Guaranteed Obligation that is payable in a currency other than
Dollars, Guarantor shall, at Bank’s option, either pay the unpaid amount of
such Guaranteed Obligation in accordance with the provisions of Section 2.12(a)
or pay to Bank at Bank’s Office the equivalent thereof in Dollars computed at
Bank’s selling rate, on the date such Guaranteed Obligation became or was
deemed to be due, for cable transfers of such foreign currency to the place
where such Guaranteed Obligation is payable, and shall hold Bank harmless from
any loss incurred by it arising from any change in the value in Dollars of such
foreign currency between the date such Guaranteed Obligation became or was
deemed to be due and the date of payment thereof.  For the avoidance of doubt, it is understood
that the exchange rate used for this purpose may be less favorable to Guarantor
than the definition of the Applicable Currency Exchange Rate.  If on the date such Guaranteed Obligation
became or was deemed to be due no such selling rate is quoted by Bank, or if at
any time Bank is unable for any reason, including interruption of
communications between Bank and any branch, to establish the amount of such
Guaranteed Obligation, Bank may determine the equivalent in Dollars of the
amount of such Guaranteed Obligation on the basis of such factors as it shall,
in its sole judgment, deem appropriate, and Guarantor shall be obligated, on
demand, to furnish such security or to make such payments on account of its
contingent liability hereunder in respect of such Guaranteed Obligation as Bank
shall request.

 

10

 

2.13         Without
prejudice to Bank’s rights hereunder and under the Credit Agreement, Guarantor
hereby agrees to pay directly to Bank on behalf of Borrower all amounts
specified under Section 1.07 of the Credit Agreement that are not paid when due
by Borrower, and authorizes and instructs Bank to debit any such amounts due
from Guarantor’s account at Bank (account no. 4000027052).

 

3.             Representations and Warranties.  Guarantor hereby represents and warrants and
covenants that:

 

(a)           Guarantor
is a corporation duly organized, validly existing and in good standing under
the laws of the jurisdiction in which it was incorporated, and is qualified to
do business and is in good standing as a foreign corporation in each other state
or jurisdiction where the character of the property owned or the nature of its
business requires it to be so qualified;

 

(b)           neither
the execution nor delivery of this Guaranty or any of the other documents
related hereto nor performance of nor compliance with the terms and provisions
hereof or thereof will conflict with or result in a breach of any laws,
statutes, codes, rules, ordinances, orders, judgments, decrees, injunctions,
rules, regulations, permits, licenses, authorizations or orders of any governmental
department, commission, board, courts, authority or agency (collectively, “Laws
and Permits”) or any other agreement or instrument binding upon Guarantor or
any of its property (collectively, “Property”), or conflict with or result in a
breach of any provision of the charter documents or by-laws of Guarantor.  No authorization, consent or approval or
other action by, and no notice to or filing with, any governmental authority is
required to be obtained or made by Guarantor for the due execution, delivery
and performance by Guarantor of this Guaranty;

 

(c)           Guarantor
has full power and authority to execute, deliver and perform this Guaranty and
to incur the obligations provided for herein, all of which have been duly
authorized by all proper and necessary company action.  No consent or approval is required as a
condition to the validity or performance of, or the exercise by Bank of any of
its rights and remedies under this Guaranty;

 

(d)           this
Guaranty constitutes legal, valid and binding obligations enforceable against
Guarantor in accordance with its terms, and its execution and performance will
not cause a breach, or an act which with the passage of time or the giving of
notice, or both, would constitute a breach, of any other agreement to which Guarantor
is a party or to which any of its respective properties is subject;

 

(e)           Guarantor
is now, after giving effect to this Guaranty, and at all times during the term
of this Guaranty shall be, solvent;

 

(f)            the principal place of business of Guarantor is 1855 Gateway
Drive, Suite 700, Concord, CA 94520-3200.

 

(g)           there
is no action, suit or proceeding at law or in equity or by or before any
governmental instrumentality or other agency, domestic or foreign, now pending
or, to the knowledge of Guarantor, threatened against Guarantor or any property
or rights of Guarantor, the effect of which would result in a material adverse
change to Guarantor’s business, operations or 

 

11

 

financial statements. 
Guarantor is not in default in any material respect with respect to any
judgment, writ, injunction, decree, rule or regulation applicable to Guarantor
of any court or governmental instrumentality or other agency, domestic or
foreign, which would result in a material adverse change to Guarantor’s
business, operations or financial statements;

 

(h)           neither
this Guaranty nor any of the other certificates, statements or information
furnished to Bank by or on behalf of Guarantor in connection with this Guaranty
or the transactions contemplated hereby contains or will contain any untrue
statement of a material fact or omits or will omit to state a material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, misleading;

 

(i)            the
consolidated and consolidating balance sheets of Guarantor and its Subsidiaries
as at December 31, 2002 and the related income and cash flow statements
for the period then ended, each other financial statement of Guarantor and its
Subsidiaries delivered to Bank on or prior to the date hereof (including any
forecasts or financial projections which may have been delivered to Bank), and
each financial statement to be delivered to Bank pursuant to Section 4.5,
as and when delivered to Bank, fairly present the financial condition of
Guarantor and its Subsidiaries as at the date thereof and the results of their
operations for the period then ended, all in accordance with GAAP consistently
applied but subject, in the case of unaudited financial statements, to normal
year-end adjustments and the absence of footnotes.  Since December 31, 2002, there has been
no Material Adverse Change.

 

4.             Covenants.
 Guarantor covenants and agrees
that so long as any Guaranteed Obligation is outstanding it shall comply and
cause each Subsidiary to comply with the following provisions:

 

4.1           Mergers. 
Guarantor shall not enter into any transaction which violates Section
5.3(h) of the Parent Credit Agreement or, if the Parent Credit Agreement shall
not be in effect, any transaction which would violate said Section 5.3(h) if it
were in effect.

 

4.2           Financial
Covenants.

 

(a)           Total
Funded Debt to EBITDA.  As of each
Fiscal Quarter End Date, Guarantor shall not cause, permit or suffer a ratio of
Total Funded Debt to EBITDA, calculated on a rolling four Fiscal Quarter basis,
to be greater than 2.00 to 1.00.

 

(b)           Cash
Flow Coverage Ratio.  Guarantor shall
maintain at all times a Cash Flow Coverage Ratio which complies with the
requirements of Section 5.1(b) of the Parent Credit Agreement as in effect on
the date hereof.

 

(c)           Minimum
Quick Ratio.  Guarantor shall not
cause, permit or suffer the Quick Ratio as of each Fiscal Quarter End Date to
be less than (i) 0.80 to 1.00. for the Fiscal
Quarter ending December 31, 2003; and (ii) 1.00 to 1.00 thereafter.

 

(d)           Minimum
Tangible Effective Net Worth. 
Guarantor shall not cause, permit or suffer a Tangible Effective Net
Worth as of each Fiscal Quarter End Date to be less than the sum of (i) $203,541,000
plus (ii) seventy percent (70%) of Consolidated Net Income for each Fiscal
Quarter (on a cumulative basis but without taking into account any loss
incurred during any 

 

12

 

Fiscal Quarter) plus (ii) one hundred percent (100%) of the
net cash proceeds from any Equity Issuance.

 

(e)           Minimum
Assets.  Guarantor shall not cause,
permit or suffer the assets of Guarantor, O.S.I Puerto Rico, Inc. and SunSoft,
Inc. on a consolidated basis determined in accordance with GAAP (after
excluding any intercompany receivables and any Investments in or between
Subsidiaries), to be less than $75,000,000 at any time.

 

(f)            Interest
Coverage Ratio.  As of each Fiscal
Quarter End Date, Guarantor shall not cause, permit or suffer the Interest
Coverage Ratio, calculated on a rolling four Fiscal Quarter basis, to be less
than 2.00 to 1.00.

 

4.3           Limits
on Debt; Accommodation Obligations. 
Guarantor shall not (i) agree to any amendment, waiver or other
modification of the Parent Credit Agreement which allows Guarantor to borrow, or
otherwise incur any other Debt or Accommodation Obligation under, the Parent
Credit Agreement in excess of $50,000,000, or (ii) incur any other Debt or
Accommodation Obligation after the date of this Agreement, other than
(x) Capital Leases, conditional sales agreement and other purchase money
Debt incurred after the date of this Agreement for property, plant or equity in
an aggregate amount not to exceed $5,000,000, or (y) Debt not exceeding
the notional amount of $75,000,000 in the aggregate at any one time outstanding
consisting of foreign exchange contracts on which delivery is to be effected
and settlement allowed at any time (or at a specified time) in the future (plus
related fees, costs and indemnities) entered into between Guarantor and any Person
having a credit rating that is similar to or better than Bank.

 

4.4           Pledge
of Borrower Equity.   Guarantor shall
not grant, or otherwise permit to exist, any Lien respecting any direct or
indirect equity or other ownership interest in Borrower held or otherwise owned
by Guarantor, including, without limitation, any Liens granted pursuant to the
Parent Credit Agreement.  Notwithstanding
the foregoing, Bank hereby represents and warrants that Bank has reviewed the
Parent Credit Agreement as in effect on the date hereof, including, without
limitation, those provisions of the Parent Credit Agreement which grant certain
Liens to secure the obligations of the Guarantor to Comerica Bank-California
thereunder, including, without limitation, the Lien granted to Comerica
Bank-California respecting the equity interest of Guarantor in Precision Lens
Manufacturing Technology, Inc., a Barbados corporation.

 

4.5           Reporting
Requirements.  Guarantor shall
furnish Bank:

 

(a)           as
soon as available and in any event within forty-five (45) days after the end of
each of the first Fiscal Quarters of each Fiscal Year, the consolidated and
consolidating balance sheet of Guarantor and its Subsidiaries as at the end of
such Fiscal Quarter and their consolidated and consolidating income and cash
flow statements for such Fiscal Quarter and for the Fiscal Year to date,
prepared by Guarantor and certified by an Authorized Officer;

 

(b)           as
soon as available and in any event within ninety (90) days after the end of
each Fiscal Year, the consolidated financial statements of Guarantor and its
Subsidiaries for such Fiscal Year, certified without any qualification by a
firm of certified public accountants of 

 

13

 

nationally
recognized standing, together with a company-prepared consolidating balance
sheet of Guarantor and its Subsidiaries as at the end of such Fiscal Year and
their consolidating income and cash flow statements for such Fiscal Year,
certified by an Authorized Officer;

 

(c)           as
soon as available and in any event within forty-five (45) days of each Fiscal
Quarter, a Compliance Certificate signed by an Authorized Officer of Guarantor
in substantially the form of Exhibit A attached hereto and setting forth
the information requested therein;

 

(d)           a copy of any notice sent by Guarantor to Comerica
Bank-California as the Agent under the Parent Credit Agreement pursuant to
Section 5.2(c)(iii) of the Parent Credit Agreement;

 

(e)           promptly
after the filing thereof, copies of all reports and all registration statements
filed by or on behalf of Guarantor with the Securities and Exchange Commission
or any national securities exchange, excluding filings on Form S-8 (or any
successor form) and any other filing solely in respect of stock option plans of
Guarantor;

 

(f)            as
soon as possible and in any event within thirty (30) days after the end of
each Fiscal Year, company-prepared financial forecasts and projections for the
ensuing Fiscal Year in a form acceptable to Bank; and

 

(g)           such other information respecting the assets, liabilities,
condition or operations, financial or otherwise, of Guarantor or any of its
Subsidiaries as Bank from time to time may reasonably request.

 

4.6           Asset
Sales.  Guarantor shall not, and
shall not permit any of its Subsidiaries to, engage in any Prohibited Asset
Sales.

 

4.7           Compliance
with Laws.  Guarantor and each of its
Subsidiaries shall comply in all material respects with all applicable laws,
rules, regulations and orders, the failure with which to comply could
reasonably be expected to cause a Material Adverse Change.

 

4.8           Preservation
of Corporate Existence, etc.  Subject
to those exceptions set forth in Section 5.3(h) of the Parent Credit Agreement
as in effect on the date hereof, and in the case of Guarantor and its Subsidiaries,
Guarantor shall (i) preserve and maintain in full force and effect its
corporate or partnership existence and good standing under the laws of the
jurisdiction in which it was incorporated or organized and all rights,
privileges, qualifications, permits, licenses and franchises material to the
normal conduct of its business; (ii) use its reasonable efforts, in the
ordinary course and consistent with past practice, to preserve its business
organization, reputation and goodwill; and (iii) preserve or renew all of
its patents, copyrights, trademarks and licenses therefore and other
intellectual property, in each case where the non-preservation of which
constitutes or could reasonably be expected to result in a Material Adverse
Change; provided, however, that Guarantor or any of its Subsidiaries may
consummate any merger or consolidation permitted under those exceptions set
forth in Section 5.3(h) of the Parent Credit Agreement as in effect on the date
hereof; and provided, further, that Guarantor or any of its Subsidiaries shall
not be required to preserve or maintain any right, asset, goodwill, business or
franchise if Guarantor or such Subsidiary shall determine that the preservation
thereof is no longer desirable in the conduct of the business of Guarantor or
such Subsidiary, as the case may 

 

14

 

be, and that the loss thereof is not disadvantageous in any
material respect to Guarantor, such Subsidiary or Bank.

 

4.9           Maintenance
of Property.  Guarantor shall
maintain and preserve all its property which is necessary for use in its
business in good working order and condition, except as permitted under those
exceptions set forth in Section 5.3(b) of the Parent Credit Agreement as in
effect on the date hereof, and except to the extent that Guarantor determines
in good faith that it is not in the best interest of Guarantor and its
Subsidiaries to do so.

 

4.10         Insurance.  Guarantor shall maintain insurance with
financially sound and reputable insurers with respect to its properties and
business against loss or damage of the kinds consistent with industry practice
of Persons engaged in the same or similar business, of such types and in such
amounts as are carried under similar circumstances by such other Persons.

 

4.11         Payment
of Taxes and Lienable Items. 
Guarantor shall pay and discharge, as they become due and payable, all
claims for material tax liabilities, assessments and governmental charges or
levies against it or upon its properties or assets and all lawful claims which,
if unpaid, would, with the passage of time or notice or both, by law become a
Lien upon its property (other than a Lien permitted by those exceptions set
forth in Section 5.3(a) of the Parent Credit Agreement as in effect on the date
hereof), unless (i) such claim is contested in good faith;
(ii) adequate reserves have been established for such claim to the extent
required by GAAP and other adequate provision for the payment thereof has been
made; (iii) enforcement of such claim is effectively stayed during any
time as such claim may otherwise become a Lien; and (iv) if such claim is
finally determined to be due, it is paid, with all interest or penalties
thereon, promptly after resolution of such contest.

 

4.12         Conduct
of Business.  Guarantor shall engage
in any business or activity other than the businesses described in Schedule
4.1(o) of the Parent Credit Agreement as in effect on the date hereof, and any
activity reasonably incidental thereto.

 

4.13         Compliance
with ERISA.  Guarantor shall directly
or indirectly (or permit any ERISA Affiliate directly or indirectly to)
(i) terminate any Plan subject to Title IV of ERISA so as to result in
liability to Guarantor or any ERISA Affiliate in excess of $1,000,000 in the
aggregate; (ii) permit any ERISA Event to exist; or (iii) make a
complete or partial withdrawal (within the meaning of ERISA section 4201) from
any Multiemployer Plan so as to result in liability to Borrower or any ERISA
Affiliate in excess of $1,000,000 in the aggregate.

 

5.             Renewal and Extension.  Guarantor authorizes Bank, without notice to,
demand of, or consent from Guarantor, and without affecting its liability to
Bank hereunder, from time to time to (a) renew, extend, accelerate or
otherwise change the time or place for payment of, or otherwise change the
terms of the Guaranteed Obligations or any part thereof; (b) take and hold
security for the payment or performance of the Guaranteed Obligations or this
Guaranty, and exchange, enforce, waive, surrender, modify, impair, change,
alter, renew, continue, compromise or release in whole or in part any security,
or fail to perfect its interest in any such security or to establish its
priority with respect thereof; (c) release Borrower, in whole or in part,
from any or all of the Guaranteed Obligations or substitute any or all of the
Guaranteed Obligations; (d) settle or compromise any or all of the
Guaranteed Obligations with Borrower or any endorser or 

 

15

 

guarantor of the Guaranteed Obligations; and
(e) subordinate any or all of the Guaranteed Obligations to any other
obligations of or claim against Borrower, whether owing to or existing in favor
of Bank or any other party.  Guarantor
shall be and remains bound hereunder notwithstanding any such renewal,
extension, acceleration, change, taking, holding, exchange, enforcement,
waiver, surrender, modification, impairment, alteration, renewal, continuation,
compromise, release, failure, application, direction, substitution, settlement or
subordination.

 

6.             Insolvency.  In the event that Borrower becomes insolvent
or files a petition for reorganization, arrangement, composition, discharge or
similar relief under any present or future provision of the Bankruptcy Code, or
if such a petition be filed against Borrower, and in any such proceedings some
or all of the Guaranteed Obligations shall be terminated or rejected or any of
the Guaranteed Obligations shall be modified or abrogated, Guarantor agrees
that its liability hereunder shall not thereby be affected or modified, and
such liability shall continue in full force and effect as if no such action or
proceeding had occurred.  This Guaranty
shall continue to be effective or reinstated, as the case may be, if any
payment of any of the obligations must be returned by Bank upon the insolvency,
bankruptcy or reorganization of Borrower or Guarantor, or otherwise, as though
such payment had not been made.

 

7.             Duty To Keep Informed.  Guarantor assumes the responsibility for
being and keeping itself informed of the financial condition of Borrower until
the termination of all of the Guaranteed Obligations hereunder pursuant to
Section 2 above, and of all other circumstances bearing upon the risk of
nonpayment or default under the Guaranteed Obligations which diligent inquiry
would reveal, and agrees that Bank shall have no duty to advise Guarantor of
information known to it regarding such condition or any such circumstances.

 

8.             Lien and Right of Setoff.  In addition to all liens upon, and right of
setoff against the moneys, securities or other property of Guarantor given to
Bank by law, Bank shall have a lien upon and right to setoff against all
moneys, securities and other property of Guarantor now or hereafter in the
possession of or on deposit with Bank, whether held in a general or special
account or deposit, or for safekeeping or otherwise; and every such lien and
right of setoff may be exercised without demand upon or notice to
Guarantor.  No lien or right to setoff
shall be deemed to have been waived by any act or conduct on the part of Bank,
or by any neglect to exercise such right of setoff or to enforce such lien, or
by any delay in so doing; and every right of setoff and lien shall continue in
full force and effect until such right of setoff or lien is specifically waived
or released by an instrument in writing executed by Bank.

 

9.             Subordination of Liens.  Any obligations of Borrower now or hereafter
held by Guarantor are hereby subordinated to the Guaranteed Obligations, and
such obligations of Borrower to Guarantor if Bank so requests shall, upon the
occurrence of a Default or Event of Default under the Credit Agreement, be
collected, enforced, supervised and received by Guarantor as trustee for Bank
and be paid over to Bank but without reducing or affecting in any manner the
liability of Guarantor under the other provisions of this Guaranty.

 

10.           Officers and Directors.  It is not necessary for Bank to inquire into
the power of Guarantor or the officers, directors or agents acting or purporting
to act on Guarantor’s behalf, and any obligations made or created in reliance
upon the professed exercise of such powers shall be guaranteed hereunder.

 

16

 

11.           Miscellaneous Provisions.

 

11.1         Binding
on Successors, Transferees and Assigns; Assignment of Guaranty.  This Guaranty shall be binding upon Guarantor
and its successors, transferees and assigns and shall inure to the benefit of
and be enforceable by Bank and its respective successors and assigns; provided,
however, that Guarantor may not transfer or assign any of its obligations
hereunder or, as long as Guarantor shall have any liability hereunder, enter
into any transaction which violates Section 4.1 without, in each case, the
prior written consent of Bank (any such transfer, assignment or transaction
without such consent to be void).

 

11.2         Expenses
of Borrower.  Guarantor shall
reimburse Bank for (a) any and all costs or expenses incurred by or on
behalf of Bank (including, without limitation, any legal fees and expenses of
Bank’s in-house or outside counsel and any fees and expenses incurred by any
auditor or in connection with any audit) in the preparation and consummation of
this Guaranty and any amendment, waiver or consent relating hereto or thereto
and (b) any and all costs or
expenses incurred by or on behalf of Bank (including, without limitation, any
fees and expenses of Bank’s in-house or outside counsel or any fees or expenses
incurred by any auditor or in connection with any audit) in the administration,
protection of rights under, and/or enforcement of, this Guaranty.

 

11.3         Amendments,
etc.  No amendment to or waiver of
any provision of this Guaranty, or consent to any departure by Guarantor
herefrom, shall in any event be effective unless the same shall be in writing
and signed by Bank and Guarantor, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.

 

11.4         Addresses
for Notices to Guarantor.  All
notices, demands, requests, consents, approvals and other communications
hereunder shall be in writing and directed to the address described in, and
deemed received in accordance with the provisions of, Section 8.01 of the
Credit Agreement.

 

11.5         No
Waiver; Remedies.  In addition to,
and not in limitation of, Section 2.3 and Section 2.5, no failure on the part
of Bank to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right hereunder preclude any other or further exercise thereof or the exercise
of any other right.  The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.

 

11.6         Section
Captions.  Section captions used in
this Guaranty are for convenience of reference only, and shall not affect the
construction of this Guaranty.

 

11.7         Severability.  Wherever possible each provision of this
Guaranty shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Guaranty shall be prohibited by or
invalid under such law, such provision shall be ineffective to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Guaranty.

 

11.8         Termination
of Guaranty.  The obligations of
Guarantor under this Guaranty shall terminate on the date upon which
(i) Guarantor has fully performed all of its obligations under this
Guaranty and (ii) all Guaranteed Obligations are satisfied in full.

 

17

 

11.9         Entire
Agreement.  This Guaranty constitutes
and contains the entire agreement of the parties with respect to the subject
matter hereof, and supersedes any and all prior negotiations, correspondence,
understandings and agreements respecting the subject matter hereof.

 

11.10       Notices.  Any notice or demand desired or required to
be given hereunder shall be in writing and deemed given when personally
delivered, sent by telecopier, overnight courier or deposited in the mail,
postage prepaid, sent certified or registered, return receipt requested, and
addressed as set forth in Section 8.01 of the Credit Agreement.  Any notice so delivered personally or by
telecopier shall be deemed to be received on the date of delivery or
transmission by telecopier; any notice so sent by overnight courier shall be
deemed to be received one (1) Business Day after the date sent; and any
notice so mailed shall be deemed to be received on the date stamped on the receipt.  Any party may change the address to which all
notices, requests and other communications are to be sent to it by giving
written notice of such address change to the other parties in conformity with
this section, but such change shall not be effective until notice of such
change has been received by the other party.

 

11.11       Counterparts.  This Guaranty may be executed in any number
of counterparts, each of which shall be an original with the same effect as if
the signatures thereof and hereto were upon the same instrument.

 

11.12       Governing
Law.  THIS GUARANTY SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH INTERNAL LAWS OF THE STATE OF
CALIFORNIA.  FOR PURPOSES OF ANY ACTION
OR PROCEEDING INVOLVING THIS GUARANTY, GUARANTOR HEREBY EXPRESSLY SUBMITS TO
THE JURISDICTION OF ALL FEDERAL AND STATE COURTS LOCATED IN THE STATE OF
CALIFORNIA AND CONSENTS THAT IT MAY BE SERVED WITH ANY PROCESS OR PAPER BY
REGISTERED MAIL OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF
CALIFORNIA.

 

11.13       Waiver
of Jury Trial.  EACH OF GUARANTOR AND
BANK HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY
HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING
OUT OF, UNDER, OR IN CONNECTION WITH, THIS GUARANTY.

 

[Remainder of this page intentionally
left blank]

 

18

 

IN WITNESS
WHEREOF, Guarantor has caused this Guaranty to be duly executed as of the date
first set forth above.

 

	
   

  	
  OCULAR SCIENCES, INC.

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Steven M. Neil

  	
   

  
	
   

  	
   

  	
  Name: Steven M. Neil

  	
   

  
	
   

  	
   

  	
  Title: CFO

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Accepted by:

  
	
   

  	
   

  
	
   

  	
  WELLS FARGO HSBC TRADE BANK N.A.,

  
	
   

  	
  a national banking association

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Virginia Adams

  	
   

  
	
   

  	
   

  	
  Name:  Virginia Adams

  	
   

  
	
   

  	
   

  	
  Title:  Vice President

  	
   

  

 

19

 

EXHIBIT A

 

FORM OF COMPLIANCE CERTIFICATE

 

This Compliance Certificate is being delivered by the undersigned, an
Authorized Officer of Ocular Sciences, Inc. (referred to herein as “Guarantor”),
on behalf of Guarantor and its Subsidiaries, to Wells Fargo HSBC Trade Bank
N.A. ( “Bank”) pursuant to Section 4.5 of that certain Parent
Guaranty, dated as of December 26, 2003 issued by Guarantor in favor of Bank.

 

Capitalized terms used herein and not otherwise defined herein shall have
the same meanings as set forth in the Guaranty.

 

Guarantor hereby certifies and warrants to Bank,
on behalf of Guarantor and each Subsidiary, as follows:

 

1.                                       The
representations and warranties contained in Section 3 of the Guaranty (or,
in the case of representations and warranties stated as having been made only
on the execution date of the Guaranty, on the execution date of the Guaranty).

 

2.                                       No
event has occurred and is continuing which constitutes an Event of Default or a
Potential Default under the Parent Credit Agreement.

 

3.                                       Since
[the most recent Fiscal Quarter End Date], there has been no Material Adverse
Change.

 

4.                                       The
Guaranty is in full force and effect.

 

5.                                       The
following is a true and correct computation of the ratios and financial tests contained
in Section 4.2 of the Guaranty as of
                      ,
20    (the “Fiscal Quarter End Date”):

 

 

[The remainder of this page left blank intentionally]

 

 

(a)           Section 4.2(a) -Total Funded Debt to
EBITDA.

 

	
  (i)

  	
   

  	
  Total amount of all Debt of Guarantor
  and its consolidated Subsidiaries as of the Fiscal Quarter End Date relating
  to (A) the borrowing of money and letters of credit and (B) Capital
  Leases, all determined in accordance with GAAP:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  EBITDA (calculated on a
  rolling four (4) Fiscal Quarter basis) determined in accordance with
  GAAP:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  Total Funded Debt to EBITDA as
  of the Fiscal Quarter End Date [Item (i) divided by
  Item (ii)]:

  	
   

  	
  :1.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  The ratio in
  Item (iii) must not be greater than:

  	
   

  	
  2.00:1.00

  	
   

  

 

 

(b)           Section 4.2 (b) – Cash Flow
Coverage Ratio

 

	
  (i)

  	
   

  	
  Consolidated Net Income for
  the four consecutive Fiscal Quarters ending on the Fiscal Quarter End Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  To the extent deducted in
  (i) above, depreciation, Consolidated Interest Expense and amortization
  for the four consecutive Fiscal Quarters ending on the Fiscal Quarter End
  Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  All non-cash charges of
  Guarantor and its consolidated Subsidiaries required by GAAP relating to
  dispositions of property, plant and equipment for the four consecutive Fiscal
  Quarters ending on the Fiscal Quarter End Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  Preferred stock dividends paid
  or payable to a Person not in the Ocular Sciences Group by Ocular Sciences or
  any of its consolidated Subsidiaries during the four consecutive Fiscal
  Quarters ending on the Fiscal Quarter End Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (v)

  	
   

  	
  Stock repurchases and/or buy
  backs by Ocular Sciences during the four consecutive Fiscal Quarters ending
  on the Fiscal Quarter End Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (vi)

  	
   

  	
  Cash Flow for the four
  consecutive Fiscal Quarters ending on the Fiscal Quarter End Date
  [Item (i) plus Item (ii) plus
  Item (iii) minus Item (iv) minus Item (v)]:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (vii)

  	
   

  	
  The current portion of
  long-term debt and Capital Leases as at the Fiscal Quarter End Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (viii)

  	
   

  	
  Cash Flow Coverage Ratio as of
  the Fiscal Quarter End Date [Item (vi) divided by
  Item (vii)]:

  	
   

  	
  :1.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ix)

  	
   

  	
  The ratio in
  Item (viii) must not be less than:

  	
   

  	
  2.00:1.00

  	
   

  

 

 

(c)           Section 4.2(c)3⁄4Minimum
Quick Ratio

 

	
  (i)

  	
   

  	
  The sum of unrestricted cash
  and unrestricted Permitted Cash Investments of Guarantor and its consolidated
  Subsidiaries as of the Fiscal Quarter End Date as determined in accordance
  with GAAP:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  Trade accounts receivable (net
  of applicable reserves therefor) of Guarantor and its consolidated
  Subsidiaries as of the Fiscal Quarter End Date as determined in accordance
  with GAAP:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  Item (i) plus
  Item (ii):

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  Current liabilities (excluding
  the aggregate principal amount of Revolving Advances or Term Advance
  outstanding under the Credit Agreement) of Guarantor and its consolidated
  Subsidiaries as of the Fiscal Quarter End Date as determined in accordance
  with GAAP:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (v)

  	
   

  	
  The aggregate principal amount
  of Revolving Advances and Term Advances outstanding under the Credit
  Agreement:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (vi)

  	
   

  	
  Item (iv) plus
  Item (v):

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (vii)

  	
   

  	
  Quick Ratio as of the Fiscal
  Quarter End Date [Item (iii) divided by Item (vi)]:

  	
   

  	
  :1.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (viii)

  	
   

  	
  The ratio in
  Item (vii) must not be less than:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a) for the quarter
  ending December 31, 2003: 

  	
   

  	
  0.80:1.00

  	
   

  
	
   

  	
   

  	
  (b) thereafter:

  	
   

  	
  1.00:1.00

  	
   

  

 

 

(d)           Section 4.2 (d)3⁄4Minimum
Tangible Effective Net Worth

 

	
  (i)

  	
   

  	
  Base amount:

  	
   

  	
  $

  	
  203,541,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  Cumulative Consolidated Net
  Income (but without taking into account any losses incurred during any Fiscal
  Quarter), commencing with the Fiscal Quarter ending on December 31,
  2003, and ending with the Fiscal Quarter ending on the Fiscal Quarter End
  Date of measurement:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  70% of Item (ii):

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  100% of the net cash proceeds
  from any Equity Issuance after the Closing Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (v)

  	
   

  	
  Item (i) plus
  Item (iii) plus Item (iv):

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (vi)

  	
   

  	
  Net book value of all assets
  of Guarantor and its consolidated Subsidiaries as of the Fiscal Quarter End
  Date as determined in accordance with GAAP:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (vii)

  	
   

  	
  Intangible Assets as of the
  Fiscal Quarter End Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (viii)

  	
   

  	
  Consolidated Total Debt as of
  the Fiscal Quarter End Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ix)

  	
   

  	
  Subordinated Debt as of the
  Fiscal Quarter End Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (x)

  	
   

  	
  Tangible Effective Net Worth
  as of the Fiscal Quarter End Date [Item (vi) minus
  Item (vii) minus Item (viii) plus Item
  (ix)]:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (xi)

  	
   

  	
  The amount in
  Item (x) may not be less than the amount in Item (v).

  	
   

  	
  Complies:

  Yes/No

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

(e)           Section 4.2(e)3⁄4
Minimum Assets.

 

	
  (i)

  	
   

  	
  Total value of assets of
  Guarantor, determined in accordance with GAAP (after excluding any
  intercompany receivables and any Investments in or between Subsidiaries):

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  Total value of assets of
  Ocular Sciences Puerto Rico, Inc., determined in accordance with GAAP (after
  excluding any intercompany receivables and any Investments in or between
  Subsidiaries):

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  Total value of assets of
  SunSoft, Inc., determined in accordance with GAAP (after excluding any
  intercompany receivables and any Investments in or between Subsidiaries):

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  The sum of Item (i) plus
  Item (ii) plus Item (iii) must not be less than:

  	
   

  	
  $

  	
  75,000,000

  	
   

  

 

 

(f)            Section 4.2
(f) – Interest Coverage Ratio

 

	
  (i)

  	
   

  	
  Consolidated earnings (or
  loss) from operations, after all expenses and other property charges but before
  payment or provision for any income taxes or interest expense, excluding any
  extraordinary or non-recurring gains or losses for the four consecutive
  Fiscal Quarters ending on the Fiscal Quarter End Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  Total interest expense (including
  the interest component of Capital Leases) of Guarantor and its consolidated
  Subsidiaries excluding the amortization or write-off of original issue
  discount, capitalized debt issuance costs and expenses, and non-cash interest
  payments or accruals for the four consecutive Fiscal Quarters ending on the
  Fiscal Quarter End Date:

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  Interest Coverage Ratio as of
  the Fiscal Quarter End Date [Item (i) divided by
  Item (ii)]:

  	
   

  	
  :1.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  The ratio in
  Item (iii) must not be less than:

  	
   

  	
  2.00:1.00

  	
   

  

 

 

The undersigned has reviewed the
terms of the Guaranty and has made, or caused to be made under his/her
supervision, a review in reasonable detail of the transactions and condition of
Guarantor and its Subsidiaries during the Fiscal Quarter covered by this
Compliance Certificate.

 

IN WITNESS WHEREOF, Guarantor has
caused this Compliance Certificate to be executed and delivered, and the
certifications and warranties contained herein to be made, as of this
           day of               ,
20   . 

 

	
   

  	
  OCULAR SCIENCES,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:  

  	
   

  
	
   

  	
   

  	
  Title:<Page>

                                                                   Exhibit 10.69

                                                                   Inline/Inland

                                AGREEMENT OF SALE

     THIS AGREEMENT made this _________ day of January 2004, between KIMCO
BARCLAY PEORIA CROSSING, L.P., an Arizona Limited Partnership, with an office at
3333 New Hyde Park Road, Suite 100 (P. O. Box 5020), New Hyde Park, New York
11042 (hereinafter, "Seller"), and INLAND REAL ESTATE ACQUISITIONS, INC., an
Illinois Corporation, with an office at 2901 Butterfield Road, Oak Brook,
Illinois 60523 (hereinafter, "Buyer").

     WHEREAS, Seller owns a shopping center commonly known as Peoria Crossing
located in Peoria, Arizona (the "Shopping Center") and Seller wishes to sell and
Buyer wishes to buy a portion of the Shopping Center;

     NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties agree as follows:

     1.   DEFINITIONS. The following expressions shall have the meanings set
forth below:

          1.1     "Real Estate" means the land described on EXHIBIT 1 and all of
the buildings and other improvements constructed thereon.

          1.2     "Space Lease(s)" means all lease(s), license(s), concessions
or other occupancy or use agreements, including all modifications, addenda and
supplements thereto and guarantees thereof, applicable to any part of the Real
Estate. All existing Space Leases as of the date hereof are listed on attached
EXHIBIT 2.

          1.3     "Property" means collectively all of Seller's rights and
interests in the Real Estate, the Space Leases and the other assets described in
ARTICLE 2 hereof.

          1.4     "Closing Date" means the date on which Closing occurs.
"Closing" means the event whereby title to the Property is actually conveyed by
Seller to Buyer.

          1.5     "Service Contracts" means all written agreements pursuant to
which goods, services or supplies are furnished on a recurring basis for the
operation of the Real Estate and are approved by Buyer during the Due Diligence
Period (as hereinafter defined). Copies of such Service Contracts are attached
as EXHIBIT 3.

          l.6     "Escrow Agent" means Chicago Title and Trust Company, 171
North Clark Street, Chicago, Illinois, Attn: Nancy Castro, Escrow Agent. Chicago
Title and Trust Company may also be hereinafter referred to as the "Title
Company".

          1.7     "Due Diligence Period" means a period of time commencing on
the date a fully executed copy of this Agreement is received by Buyer in
accordance with Article 13 hereof and expiring at midnight, New York time, on
the 30th calendar day thereafter or the first business day after such 30th day
if such 30th day is not a business day.

          1.8     "Permitted Exceptions" means those certain title exceptions
set forth in EXHIBIT 6 attached hereto that are approved by Buyer in accordance
with the terms of Article 6 hereof.

          1.9     "Personal Property" means all personal property and equipment
(if any) owned by Seller and located on the Real Estate.

          1.10    "Deposit" means a deposit, to be paid by Buyer to Escrow Agent
upon the execution hereof, in the amount of FIVE HUNDRED THOUSAND ($500,000.00)
DOLLARS, plus all interest earned thereon.

          1.11    "REA" means that certain Operation and Easement Agreement
                  dated December 12, 2000, between Target and Seller recorded as
                  document Number 2000-0955893 as amended Buyer acknowledges
                  receipt of a copy of the REA.

          1.12    "Environmental Report" means that certain Phase 1
                  Environmental Assessment dated March 13, 2000 and prepared by
                  SPREDIER & ASSOCIATES. Buyer acknowledges receipt of a copy of
                  the Environmental Report.

          1.13    "Development Agreement" shall mean that certain Amended and
                  Restated Development Agreement dated December 1, 2000 between
                  Seller (as successor by assignment from Barclay Holdings XVI,
                  L.L.C. d/b/a Barclay Group) and the

<Page>

                  City of Peoria, Arizona dated December 1, 2000, and recorded
                  as document number 2000-0943910 on December 11, 2000.

     2.   SALE AND PURCHASE. In accordance with the provisions of this
Agreement, Seller agrees to sell, convey, assign and transfer to Buyer, and
Buyer agrees to purchase and acquire from Seller, subject to the Permitted
Exceptions and Space Leases, all of Seller's right, title and interest in and
to: (a) the Real Estate, (b) the Space Leases, (c) any Personal Property, (d)
any land lying in the bed of any street, road or avenue, opened or proposed, in
front of or adjoining the Real Estate, (e) any strips or gores adjoining the
Real Estate, (f) all appurtenances and hereditaments appertaining to the Real
Estate (excluding any benefits or reimbursements provided for in the Development
Agreement) and (g) the right to use, in common with the Seller (or its
successors with respect to the remaining portion of the Shopping Center) the
name "Peoria Crossing Shopping Center" provided Buyer's use of same is done in a
commercially reasonable manner in connection with the first class operation of
the Property.

     3.   PURCHASE PRICE. The "Purchase Price" for the Property shall be THIRTY
SEVEN MILLION TWO HUNDRED SIXTY EIGHT THOUSAND ($37,268,000.00) DOLLARS and
shall be paid as follows:

          A.      (i)    Upon the execution of this Agreement Buyer shall pay
the Deposit to Escrow Agent by bank check to the order of Escrow Agent or wire
transfer of federal funds for immediate credit.

                  (ii)   The Deposit shall be invested by Escrow Agent in a
sound financial institution's money market fund or account which pays interest
or dividends, in Escrow Agent's name separate from its personal and business
accounts. All investment decisions shall be made by Buyer. If no Closing occurs,
all interest or dividends earned shall be paid to the party entitled to the
escrowed proceeds, which party shall pay all income taxes thereon. The parties
shall furnish Escrow Agent with their respective tax identification numbers. At
Closing, Escrow Agent shall pay the Deposit (together with all interest earned
thereon) to Seller; and the principal portion of the Deposit shall be a credit
against the Purchase Price (but no such credit shall be given for the interest
earned on such principal portion of the Deposit, if any, which shall be the
property of Buyer). All escrow fees, if any, charged by Escrow Agent shall be
equally shared by Seller and Buyer. Escrow Agent shall hold the Deposit as set
forth above unless either Seller or Buyer makes a written demand upon Escrow
Agent for the Deposit accompanied by an affidavit signed by the party making the
demand stating sufficient facts to show that said party is entitled to receive
the Deposit pursuant to the terms of this Agreement. Upon receipt of such
demand, Escrow Agent shall give ten (10) days written notice to the other party
of such demand and of Escrow Agent's intention to remit the Deposit to the party
making the demand on the stated date, together with a copy of the affidavit. If
Escrow Agent does not receive a written objection before the proposed date for
remitting the Deposit, Escrow Agent is hereby authorized to so remit. If,
however, Escrow Agent actually receives written objection from the other party
before the proposed date on which the Deposit is to be remitted, Escrow Agent
shall continue to hold the Deposit until otherwise directed by joint written
instructions from Seller and Buyer or until a final judgment of an appropriate
court. In the event of a dispute, Escrow Agent may place the Deposit with an
appropriate court and, after giving written notice of such action to the
parties, Escrow Agent shall have no further obligations with respect to the
Deposit. The parties acknowledge that Escrow Agent is acting as a stakeholder at
their request and for their convenience, that Escrow Agent shall not be deemed
to be the agent of either of the parties, and the Escrow Agent shall not be
liable to either of the parties for any act or omission on its part unless taken
or suffered in bad faith or in willful or negligent disregard of this Agreement.
Seller and Buyer shall jointly and severally indemnify and hold Escrow Agent
harmless from and against all costs, claims and expenses, including reasonable
attorney' fees, incurred in connection with the faithful performance of Escrow
Agent's duties hereunder. Escrow Agent acknowledges agreement to the provisions
of this Agreement applicable to it by signing on the signature page of this
Agreement. Notwithstanding the foregoing, Buyer shall have the right to deliver
a notice of termination of this Agreement to Escrow Agent and Seller on or prior
to the expiration of the Due Diligence Period and Escrow Agent shall be
authorized, immediately upon receipt of such notice and verification of Seller's
receipt of same, to return the Earnest Money to Buyer. Buyer agrees to return
all documents provided to Buyer by or on behalf of Seller to Seller within
fifteen (15) days of Tenant's delivery of the notice of termination to Escrow
Agent and Seller.

          B.      At Closing, and subject to the terms and provisions of this
Agreement, Buyer shall pay Seller the balance of the Purchase Price by wire
transfer of immediately available federal funds into a so-called "New York
Style" closing escrow to be established by the Escrow Agent. Seller shall
furnish Escrow Agent with wire transfer instructions prior to Closing.

          C.      Intentionally Deleted.

2
<Page>

          D.      In connection with any Personal Property included in the sale,
the parties agree that no part of the Purchase Price shall be deemed to have
been paid by Buyer on account thereof.

     4.   CONDITIONS PRIOR TO CLOSING; DUE DILIGENCE PERIOD.

          4.1     (A) Buyer shall at Closing accept the Property in AS IS
physical condition as exists on the date hereof, subject to reasonable wear and
tear between the date hereof and the Closing Date. Buyer acknowledges that Buyer
will have the Due Diligence Period to inspect the Shopping Center or cause an
inspection thereof to be made on Buyer's behalf and it is understood and agreed
that neither Seller nor any person acting or purporting to act for Seller has
made or now makes any representation as to the physical condition (latent or
patent or otherwise), income, expense, operation, legality of current rents, or
any other matter of thing affecting or relating to the Shopping Center except as
herein specifically set forth. Buyer hereby expressly acknowledges that except
as expressly set forth herein, no such representations have been made and Buyer
further agrees to take the Shopping Center "as is" as of the date hereof and
subject to normal use, wear, tear, and deterioration between now and Closing.
Buyer agrees that Seller is not liable or bound in any manner by any financial
or written statements, representations, real estate brokers' "set-ups", or
information pertaining to the Shopping Center furnished by any real estate
broker, agent, employee, trustee, servant or other person, unless the same are
specifically set forth herein. It is understood and agreed that all
understandings and agreements heretofore had between the parties are hereby
merged in this Agreement which alone fully and completely expresses their
agreement and that the same is entered into after full investigation, neither
party relying upon any statement or representation made by the other not
embodied in this Agreement.

          (B) SELLER'S REQUIRED PRE-CLOSING DELIVERIES

Seller shall, as soon as practicable after the date of this Agreement but not
later than five (5) business days after the date of this Agreement,, deliver to
Buyer the following (which are referred to herein as "Pre-Closing Deliveries"):
(a) copy of the Space Leases affecting the Property; (b) a certification from
Seller (pursuant to the terms of the Rent Roll (Exhibit 2) setting forth the
name of each tenant at the Property and the date of the Space Leases and any
modifications or amendments thereto, the amount of rent payable by each tenant
throughout the term of its respective Space Lease, any concessions granted to
the tenants, the amount of security deposits, if any, (or a certification that
Seller is not holding any security deposits), the expiration date of the Space
Leases, and the existence of any options to renew or extend the term of the
Space Leases or to purchase all or any part of the Property and such information
with respect to any subtenant if Seller has knowledge thereof; (c) a
certification by Seller that there are no employees at the Property; (d) a
certification by Seller that, other than as disclosed to Buyer, there are no
service agreements, maintenance contracts or other similar agreements affecting
the Property; (e) copies of the most recent tax bill for the Property, together
with copies of any notice of assessments received by Seller, or any other
information relative to taxes assessed against the Property; (f) copies, if any,
of any environmental reports, architectural drawings, warranties, guarantees,
plans and specs or any similar document in Seller's possession relating to the
Property; (g) copies of any insurance policies or certificates insuring the
Property, whether purchased by Seller or by the tenants under the Space Leases;
(h) copies of certificates of occupancy for each tenant at the Property and
copies of any building code violations received by Seller with respect to the
Property during the last two years and evidence reasonably acceptable to Buyer
that such violations have been corrected, or a certification from Seller that it
has not received any notice of building code violations; (i) the materials
described on Buyer's Due Diligence Checklist, attached hereto as Exhibit 12, and
made a part hereof; (j) as applicable (depending upon the number of years the
Property has been operating), an operating statement for the Property for the
two calendar years prior to the year of the date hereof, and monthly operating
statements for the Property for each month of the year of the date hereof. Such
statements shall include reasonable detail of all items of income and expense,
other than construction costs as well as all items of capital expenditures made
during the relevant periods, other than capital expenditures made in connection
with the initial construction of the Shopping Center.

          4.2     On and after the date hereof, Buyer shall have access to the
Property for the purpose of making engineering, survey or non-intrusive
inspections and independent investigations; and Seller will on receipt of
reasonable prior written notice, provide Buyer with access to information within
its possession or control with respect to the Property, including (without
limitation) full and accurate copies of Space Leases, Service Contracts, title
information or instruments, and books and operating records of the Shopping
Center. Buyer agrees to defend, indemnify and hold Seller harmless from any
personal injury or property damage caused by Buyer in doing any testing,
inspections or survey and such obligation shall survive the Closing or sooner
termination of this Agreement. Buyer shall give Seller true, accurate and
complete copies of all written reports prepared by third parties resulting from
Buyer's inspections and investigations.

3
<Page>

          4.3     (a)    Buyer shall have the Due Diligence Period within which
to inspect and examine the Real Estate, the Space Leases and the Service
Contracts.

                  (b)    In the event that during the Due Diligence Period,
Buyer, in its sole judgment, and absolute discretion, determines that Buyer is
not satisfied with the condition of the Real Estate, the Property, the Space
Leases or the Service Contracts then, prior to the end of the Due Diligence
Period, Buyer shall have the right by giving written notice to Seller and Escrow
Agent to cancel and terminate this Agreement without liability except as set
forth in Sections 4.2 and 15.8, Upon receipt of such notice prior to the end of
the Due Diligence Period, Escrow Agent shall deliver the Deposit to Buyer. In
the event Buyer fails to give such notice prior to the end of the Due Diligence
Period, Buyer's right to cancel this Agreement pursuant to this Section 4 shall
lapse.

          4.4     Replat of Shopping Center and Real Estate. During the Due
Diligence Period Seller shall prepare a proposed replat of the Real Estate, from
the Shopping Center of which it is a part such that the Real Estate will be
comprised of a separate lot(s) for real estate taxes and other purposes (the
"Replat"). The Parties acknowledge that such Replat is subject to Target's
approval and then City of Peoria's approval (the "City"). On or before closing,
Seller shall either: (i) submit same for approval and recording with the City or
(ii) advise the City of the proposed Replat and of its intention of selling the
Real Estate to Buyer before the Replat has been submitted or accepted for
recording. Buyer acknowledges that the Closing may occur without such Replat
being recorded and/or approved by the City or other applicable government
authorities. In the event the Replat is not completed (i.e. submitted, approved
by the City and recorded) as of the Closing, the Seller may convey and the Buyer
agrees to accept the transfer of the Real Estate based on a metes and bounds
description of such Real Estate (which Title Company will insure). Seller at its
sole cost and expense agrees to continue to use its diligent good faith efforts
to complete the Replat of the Real Estate after Closing and Buyer agrees to
cooperate with Seller to obtain same, which may include de minimus adjustments
to boundaries of the Real Estate to the extent required by the City.

          4.5     THE "BUYER DECLARATION". The OEA only provides for two (2)
Approving Parties as defined therein in as Target and Seller. Accordingly during
the Due Diligence Period Buyer and Seller shall negotiate an Agreement that will
provide for a process between Buyer and Seller for any approvals required by
Buyer under the OEA as it is the intention of the Parties that after Closing
Seller shall remain both the "Approving Party" of the Developer Tract and the
"Operator", and to ascertain Buyer's percentage of the Developers Tract for
purposes of calculating Buyer's share of Common Area Maintenance Costs as such
terms are defined in the OEA.

          4.6     KOHL'S AMENDMENT. The Space Lease with the tenant Kohl's
Department Stores, Inc. ("Kohl's") dated May 7, 2002 as amended ("Kohl's Lease")
provides that Landlord shall endeavor to obtain an amendment to the OEA to
provide that Kohl's may maintain the Kohl's Trust as such term is defined in the
Kohl's Lease. It shall be a condition of closing that Seller provide an
amendment to the Kohl's lease acknowledging Target will not consent to such an
amendment to OEA and such condition is deemed waived if Target does agree to so
amend. In addition the Kohl's lease provides that Kohl's has an option to lease
additional space referred to as the "Expansion Space". It shall be a condition
of closing that Seller obtain an amendment to the Kohl's lease to include the
Expansion Space into the Kohl's lease, acknowledging that Kohl's will pay for
any and all CAM, real estate taxes and insurance for such Expansion Space.

          4.7     "BUYER OPTION." The Kohl's lease provides that Kohl's may
expand its Building and build onto the Expansion Space. In the event Kohl's were
to exercise its option and build on the Expansion Space, the Kohl's Tract would
not contain enough additional parking spaces (the shortfall) to satisfy the
parking ratio requirements under the OEA which contains enough parking spaces to
make up the shortfall. Accordingly in the event Kohl's exercises its right to
expand into the Expansion Space Seller (or its successor in interest) agrees to
sell Parcel X as set forth on Exhibit___for One Hundred Twenty Five Thousand
Dollars $125,000.00 ("the Option Land"). At closing the parties shall enter into
an Option Agreement and record notice of Option Agreement against Parcel X.

     5.   ADJUSTMENTS AND PRORATIONS.

          5.1     Seller shall be entitled to all income produced from the
operation of the Property which is allocable to the period prior to the Closing
Date and shall be responsible for all expenses allocable to that period; and
Buyer shall be entitled to all income and responsible for all expenses allocable
to the period beginning at 12:01 A.M. on the Closing Date. At Closing, all items
of income and expense with respect to the Property shall be prorated in
accordance with the foregoing provisions and the rules for the specific items
set forth hereafter:

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                  5.1.1  Seller shall arrange for a billing under a11 those
Service Contracts for which fees are based on usage and with utility companies
for a billing for utilities, to include all utilities or service used up to the
Closing Date, and Seller shall pay the resultant bills. In the event any of the
Service Contracts set forth in EXHIBIT 3 cover periods beyond the Closing Date
the same shall be prorated on a per diem basis.

                  5.1.2  Real estate taxes, general, special and/or betterment
assessments and personal property taxes shall be prorated for those taxes which
are due and payable as of the Closing Date. In the event that as of the Closing
Date the actual tax bills for the tax year or years in question are not
available and the amount of taxes to be prorated as aforesaid cannot be
ascertained, then rates, millages and assessed valuation of the previous year,
with known changes, shall be used; and after the Closing occurs and when the
actual amount of taxes for the year or years in question shall be determinable,
such taxes will be re-prorated between the parties to reflect the actual amount
of such taxes.

                  5.1.3  Rentals and other payments (other than "percentage
rent" and common area maintenance charges which are dealt with in SECTION 5.1.4
and SECTION 5.1.6) which are payable pursuant to Space Leases shall be prorated
on a per diem basis as and when collected (subject to the provisions of Section
5.3). Buyer shall not be obligated to make any payment or give any credit to
Seller on account of or by reason of any rental or other payments which are
unpaid as of the Closing Date, but shall be required to turn over Seller's share
of the same within ten (10) days if, as and when received by Buyer after the
Closing; likewise, Seller agrees to turn over Buyer's share of any payments
received from tenants applicable to any period from and after the date of
Closing within ten (10) days of Seller's receipt of same; this provision shall
survive Closing.

                  5.1.4  Percentage rent; if any, payable under each Space Lease
shall be prorated with respect to the lease year thereunder in which Closing
occurs on a per diem basis as and when collected. Any percentage rent collected
by Buyer including any percentage rent which is delinquent and pertaining to (i)
an entire lease year or accounting period of a tenant under a Space Lease which
ends on a date prior to the Closing Date, or (ii) that portion of a lease year
or accounting period of such tenant covering a period prior to the Closing Date
where such lease year or accounting period begins prior to the Closing Date and
ends thereafter shall in both cases be paid to Seller within ten (10) days of
receipt by Buyer; and if any tenant's Space Lease provides for offsets or
deductions against percentage rent, then such offsets or deductions shall be
prorated in the same manner as the percentage rent itself is prorated. This
provision shall survive Closing.

                  5.1.5  Gas, water, electricity, heat, fuel, sewer and other
utilities charges to which SECTION 5.1.1 cannot be applied, and the governmental
licenses, permits and inspection fees and operating expenses relating to the
Shopping Center (expressly excluding therefrom, however, such expenses relating
to the initial construction of the Shopping Center), shall be prorated on a per
diem basis.

                  5.1.6  Common area maintenance expenses and charges shall be
prorated. Seller shall be responsible for all common area expenses and charges
incurred prior to the Closing Date, and Buyer shall be responsible for the same
accruing on and subsequent to the Closing Date. All common area expense payments
made by each tenant and such charges paid under its Space Lease for the entire
lease year during which the Closing occurs, including end-of-year adjustments,
if any, shall be prorated between Seller and Buyer in the following manner: Not
later than three (3) days prior to Closing, Seller shall deliver to Buyer, with
regard to each Shopping Center tenant required to pay common area charges ("CAM
Charges") under its lease, a detailed computation showing all CAM Charge
expenses incurred by Seller for the period from the beginning of each such
tenant's then current billing period for CAM Charges (e.g., calendar year, lease
year, etc.) through the Closing Date, any CAM estimated payments or charges
collected by Seller relating to such tenant (hereinafter "CAM Estimates"), and a
bill for the tenant's pro rata share of CAM Charges (i.e., for CAM charges
through the Closing Date net of any such CAM Estimates held by Seller), together
with all invoices and other evidence documenting such CAM Charges in detail
required by such tenant's lease. Buyer shall send any such bills to tenants
promptly following Closing, in which event such tenant shall pay any amount
shown due directly to Seller, and except as otherwise stated in Section 5.3.3
below Buyer shall have no responsibility to collect same. However, if any tenant
rightfully refuses to pay such bill for CAM Charges due through the Closing
Date, then Buyer shall resubmit such bill to any such tenant at the same time as
Buyer next submits Buyer's own bill to any such tenant; and any payment
thereafter made by any such tenant on account of CAM Charges shall belong to and
be forwarded within ten (10) days of its receipt to Seller until Seller's bill
is paid in full.

                         Any CAM Estimates for any tenant shall be retained by
Seller up to the amount of the pre-Closing CAM Charges payable by such tenant as
evidenced by such bills and

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computations delivered by Seller at Closing, and Buyer shall receive a credit
for any excess CAM Estimates collected by Seller.

                  5.1.7  All prepaid rentals, other prepaid payments(other than
monthly real estate tax estimates or installments), security deposits paid
pursuant to Space Leases, electric, gas, sewer and water deposits deposited with
Seller by tenants, (including any accrued interest required under any Space
Lease on all of the foregoing, unless Seller is entitled to retain the benefit
thereof) under any Space Leases, license agreements or concession agreements
relating to the Property, shall all belong to Buyer and all shall be assigned
and delivered to Buyer at Closing, whereupon Seller shall be released from all
liability with respect thereto. At Seller's option, Buyer shall receive a cash
credit in the amount of all Security Deposits to be delivered to Buyer at
Closing, and Seller may retain same.

                  5.1.8  Buyer shall not be responsible for any charges,
salaries, vacation pay or fringe benefits of employees of Seller prior to or
following the Closing and none of the foregoing shall be prorated.

          5.2     All prorations and payments to be made under the foregoing
provisions shall be made on the basis of a written statement or statements
delivered to Buyer by Seller and approved by Buyer. In the event any prorations,
apportionments or computation shall prove to be incorrect for any reason, then
either party shall be entitled to an adjustment to correct the same, provided
that it makes written demand on the one from who it is entitled to such
adjustment within two (2) years after the erroneous payment or computation was
made; this provision shall survive Closing.

          5.3     All accounts receivable flowing from the Property shall be
treated as follows:

                  5.3.1  Buyer and Seller agree to treat all base or minimum
rental payments received from a tenant as applicable to base or minimum rent
which was owed by that tenant, if any, first for the month prior to the month in
which Closing occurs and next for the month in which Closing occurs until the
base or minimum rental amount due to Seller for such periods have been
collected. In the event that there remains any unpaid base or minimum rent for a
period prior to such periods, all payments of base or minimum rent received from
such tenant shall be applied to sums owed Buyer before any part thereof shall be
treated as belonging to Seller. In the event that there remains any unpaid
tenant receivable other than base or minimum rent (including without limitation
any tax, CAM, insurance or percentage rent payments) for any period prior to
Closing, all payments received from any tenant in arrears (whether base or
minimum rent or any other amount) shall be applied first to any such sums owed
Buyer from such tenant before any part thereof shall be treated as belonging to
Seller.

                  5.3.2  In the event that any tenant of Seller or Buyer shall
hereafter apply or shall have heretofore applied for relief under the provisions
of any bankruptcy or similar laws for the protection of debtors, the provisions
of SECTION 5.3.1 shall not apply, and the parties shall have the right to seek
collection of their respective accounts, their entitlements being determined by
the Closing and the other provisions of this Agreement. Neither party shall have
the right to enter into any transactions that purport to compromise claims
belonging to the other, without the other party's prior written consent.

                  5.3.3  If at the Closing Date any tenants owe Seller any money
(i.e. reimbursements to Seller for payment of liens or violations on the
Property that were created by tenant(s) but that Seller is required hereunder to
satisfy in order to effectuate the sale of the Property), Seller shall have the
right, subsequent to the Closing, to collect such sums directly from the
tenants, including bringing lawsuits against the tenants (at Seller's sole
expense) for such collection (except that Seller is prohibited from bringing a
lawsuit against any tenant(s) to collect rent arrears; instead Buyer agrees to
use commercially reasonable efforts to collect such arrears on Seller's behalf);
provided, however, Seller agrees that any such legal action or collection shall
not include any disturbance of the possession, use or occupancy of the tenants
or any right to evict the tenants, whether pursuant to the lease provisions or
otherwise, and Buyer shall at Seller's expense join in any lawsuit and/or also
participate or cooperate with Seller in its collection attempts. Buyer will (at
Seller's expense) join in such a lawsuit or action only if the same does not
include or require disturbance of the possession of any tenants.

                  5.3.4  In the event Seller has granted rent concessions to
tenants under space lease(s) that would extend beyond the Closing Date, Buyer
shall receive credit for same.

          5.4     The provisions of this Article 5 will survive Closing.

     6.   TITLE AND SURVEY.

          6.1.    Seller shall convey and Buyer shall accept, subject to the
right of Buyer to review and approve all title matters, documents and plats of
record in regard to the condition of title to

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the Property, title such as the Title Company will be willing to approve and
insure subject only to Permitted Exceptions as provided for in this Agreement.
Buyer acknowledges that it has heretofore received copies of Seller's existing
title insurance policy for the Real Estate (the "Existing Title Policy") and of
Seller's existing survey of the Real Estate (the "Existing Survey"). Promptly
following the execution of this Agreement, Buyer may (if it so elects) obtain
(at Buyer's sole expense) updates of the Existing Survey to the certification
standards described upon the Surveyor's certification attached hereto as Exhibit
13 and made a part hereof (such updated survey hereinafter referred to as the
"Updated Survey"); if Buyer does obtain such an Updated Survey, Buyer shall
cause it to be certified to Seller and Buyer shall promptly furnish Seller and
the Title Company with a copy thereof. Promptly following the execution of this
Agreement, Buyer shall also (at Buyer's sole expense) obtain a commitment for
ALTA Form B Fee Title Insurance (the "Title Commitment"); and Buyer shall
promptly cause the Title Company to furnish Seller with true accurate and
complete copies thereof (including true, accurate and complete copies of all
underlying title exception documents referenced therein). Not later than the
expiration of the Due Diligence Period, Buyer shall give Seller written notice
("Buyer's Title/Survey Notice") of any title exceptions which are contained in
the Title Commitment and/or the Survey which are not Permitted Exceptions.
Failure by Buyer to give Buyer's Title/Survey Notice (or to object to any matter
referenced in the Title Commitment) to Seller on or before said date shall
constitute Buyer's final and irrevocable approval of the condition of title (and
to any such unobjected to matter) in and to the Real Estate. If Buyer's
Title/Survey Notice shall be timely given Seller shall have a period of fifteen
(15) days following Seller's receipt of Buyer's Title/Survey Notice, to commence
to remove, correct, cure or satisfy (provided Seller does in fact elect to so
remove, correct, cure or satisfy) any title exceptions that were identified in
Buyer's Title/Survey Notice as not being Permitted Exceptions, it being
nevertheless agreed that Seller shall have no obligation to undertake any action
or to incur any expense in order to effectuate any such removal, correction,
cure or satisfaction (except that notwithstanding the foregoing Seller shall be
required to remove or discharge any fee mortgages or deeds of trust, as well as
any other liens in an ascertainable dollar amount ). In the event that Seller
elects not to attempt to remove, correct, cure or satisfy the matters raised in
Buyer's Title/Survey Notice, or if having elected to do so, does not within
thirty (30) days thereafter, (or such additional time as is reasonably necessary
(not to exceed an additional fifteen (15) days without Buyer's written consent)
to remove, correct, cure or satisfy the matter(s) so raised using commercially
reasonable good faith efforts) effectuate any such removal, correction, cure or
satisfaction as aforesaid (hereinafter called "title correction"), Buyer shall
have the right at its sole option either (a) to terminate this Agreement, in
which event the Deposit shall be returned to Buyer and neither party shall
thereafter have any further liability hereunder, or (b) to accept such title as
is disclosed by the Title Commitment and/or Survey without title correction and
without Survey correction and without any reduction to the Purchase Price,
thereby waiving any rights against Seller with respect thereto. Said election
shall be made by Buyer within three (3) days following Buyer's receipt of
written notification by Seller that Seller has not effectuated (or has elected
not to effectuate) title correction. In the event that Seller (even though under
no duty to do so) shall undertake title correction and/or Survey correction as
aforesaid, and shall be successful, this Agreement shall continue in full force
and effect and Buyer shall close the transaction contemplated hereby in
accordance with the terms hereof. In the event that Seller shall only be
partially successful in obtaining title and/or Survey correction, Buyer shall
have the same alternative rights as Buyer would have in the event Seller had
declined to seek title and/or Survey correction (as set forth above). Buyer
shall make its election within three (3) days after Buyer's receipt of written
notice from Seller to Buyer of the extent to which title and/or the Survey has
been corrected.

          6.2     If at the Closing Date there may be any liens or encumbrances
which render title unmarketable or otherwise are not permitted title exceptions
hereunder, and which Seller is obligated or desires to pay and discharge, Seller
may use any portion of the balance of the Purchase Price to satisfy the same,
provided Seller shall simultaneously either deliver to Buyer at the Closing
instruments in recordable form and sufficient to satisfy such liens and
encumbrances of record together with the cost of recording or filing said
instruments; or provided that Seller has made arrangements with the title
company in advance of Closing, Seller will deposit with said company sufficient
monies, acceptable to and required by it to insure obtaining and the recording
of such satisfactions and the issuance of title insurance to Buyer either free
of any such liens and encumbrances, or with insurance against enforcement of
same out of the insured premises. The existence of any such liens and
encumbrances shall not be deemed objections to title, if Seller shall comply
with the foregoing requirements. Unpaid liens for taxes, water charges, sewer
rents and assessments which are the obligation of Seller to satisfy and
discharge shall be objections to title, and thus the amount thereof, plus
interest and penalties thereon, shall be deducted from the Purchase Price to be
paid hereunder and allowed to Buyer, subject to the provisions for apportionment
of taxes, water charges and sewer rents contained herein. Unpaid franchise tax
of any entity in the chain of title to which such tax is applicable, or estate,
income or other taxes which may be liens against the Property as of the Closing
Date shall not be an objection to title, provided the title company agrees to
insure against the collection of said taxes from the Property and in such event
if required by the title company, Seller agrees to deposit at Closing with the
title company an amount deemed reasonable by it to secure the payment of such
unpaid franchise tax, or other tax.

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          6.3     In the event that Seller is unable to convey title in
accordance with the terms of this Agreement, or if any representation of Seller
herein is untrue in a material respect on the Closing Date and Seller does not
correct same (it being understood Seller will be entitled to a reasonable
adjournment of Closing for such purpose, not to exceed fifteen (15) days), the
sole responsibility of Seller will be to refund (or cause to be refunded by the
Escrow Agent) to Buyer any amount paid on account of the Purchase Price; upon
the making of such refund, this Agreement shall be deemed canceled, neither
party shall have any further claim against the other by reason of this
Agreement, except that Buyer shall remain liable on its obligations under
Sections 4.2 and 15.8.

          6.4     All costs of obtaining the Title Commitment, the policy of
title insurance to issue at Closing (in form subject to Buyer's sole discretion,
and agreed to prior to the expiration of the Due Diligence Period) with premium
up to the amount of the Purchase Price the costs of any excess coverage or
endorsements includes Zoning 3.1; Survey; Access, Usury, Location, Tax ID,
Contiguity, EPA, Comprehensive and Doing Business shall be borne by Buyer (the
"Title Policy") and Survey shall be borne by Buyer, expressly excluding
therefrom, however, the costs to release any monetary encumbrance affecting the
Property and any title curative endorsements which shall be borne by Seller.

     7.   DAMAGE, DESTRUCTION OR REQUIRED ALTERATION.

               7.1  Prior to Closing, in the event of any damage to or
destruction of all or part of the Real Estate (notice of which shall be given to
Buyer by Seller as soon as practicable following its occurrence), then Seller
shall have the right (but not the obligation) to adjourn the Closing Date for up
to sixty (60) days in order to repair or replace such damage or destruction,
except that if the cost of such repair or replacement exceeds ten percent of the
Purchase Price, then in any such case (i) Buyer shall have the right to
terminate this Agreement by giving Seller written notice of its intention to do
so, such notice by Buyer to Seller to be given not later than three (3) days
after Buyer shall have received the notice from Seller of such aforesaid
occurrence, (in which event the Deposit shall forthwith be returned to Buyer,
whereupon this Agreement shall be null and void and of no further force or
effect whatsoever, except that Buyer shall remain liable on its obligations
under Sections 4.2 and 15.8); or (ii) if Buyer elects not to (or does not have
the right to) terminate this Agreement, this Agreement shall continue in full
force and effect except that at Closing Buyer shall receive an abatement of the
Purchase Price in an amount equal to Seller's reasonable good faith estimate of
the amount required to repair and restore all unrepaired damage (and Seller
shall retain all rights to collect insurance proceeds for such loss). Buyer may
elect to have its architect provide a good faith estimate of the amount required
to repair and restore all unrepaired damage. If Seller's estimate disagrees with
Buyer's architect's estimate, the parties shall select another architect to make
a final determination of the amount required to repair and restore all
unrepaired damage and both parties shall be bound by the third architect's
determination. The party whose architect differs most from the third architect's
determination shall pay the third architect's fee.

               7.2(a) In the event that any governmental authority having
jurisdiction of all or part of the Real Estate has notified Seller before the
Closing that some alteration of or addition to the Real Estate is required to be
made by law, rule or regulation (notice of which shall be given to Buyer by
Seller as soon as practicable after its receipt) or otherwise requires a cure of
a violation, then (subject to the provisions of Section 7.2(b)) Seller shall
have the right (but not the obligation) to undertake such alteration or addition
or cure; provided, however, that if the cost of such alteration or addition or
cure shall exceed the sum of one (1%) percent of the Purchase Price, then in
such event Seller may either elect to pay the entire cost and cure the same
before the Closing or may decline to undertake the same, in which event Buyer
shall have the option, exercisable within three (3) days following notice from
Seller of the requirement and Seller's refusal to comply therewith, (i) to
terminate this Agreement by giving Seller notice thereof (in which event the
Deposit shall forthwith be returned to Buyer, whereupon the Agreement shall be
null and void and of no further force or effect whatsoever, except that Buyer
shall remain liable on its obligations under Sections 4.2 and 15.8); or (ii) if
such notice of termination is not timely given, to proceed with the Closing, in
which event the Purchase Price shall be reduced by Seller's reasonable good
faith estimate of the cost to cure, up to the maximum sum of one percent of the
Purchase Price. Buyer may elect to have its engineer provide a good faith
estimate of the cost to cure. If Seller's estimate disagrees with Buyer's
architect's estimate, the parties shall select a another engineer to make a
final determination of the cost to cure and both parties shall be bound by the
third engineer's determination. The party whose engineer differs most from the
third engineer's determination shall pay the third engineer's fee.

                  (b) Notwithstanding the foregoing provisions of Section
7.2(a), Seller may elect but shall have no obligation to cure or pay for, , any
violation which either (i) is first placed (i.e., notice first given to Seller
or first placed of record) after the date of this Agreement, or (ii) is the

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responsibility of a Shopping Center tenant to cure or discharge pursuant to its
Space Lease. In the event Seller elects to cure or pay for such violation(s),
Seller shall have a period of fifteen (15) days after receipt of notice of the
violation to commence to cure or pay for same, and shall proceed with diligence
to cure same, however, if Seller elects to cure a violation, and Seller
reasonably believe that the Closing Date (as hereinafter defined) will need to
be extended more than thirty (30) days to effectuate the cure, then Seller shall
not commence to cure the violation then Buyer may elect to (i) complete the
purchase without any adjustment in the Purchase Price or (ii) terminate the
Agreement in such event, unless Buyer agrees to the required extension. In the
event Seller elects not to cure or pay for such violation, the sole
responsibility of Seller will be to refund (or cause to be refunded by the
Escrow Agent) to Buyer any amount paid on account of the Purchase Price; upon
the making of such refund, this Agreement shall be deemed cancelled, neither
party shall have any further claim against the other by reason of this
Agreement, except that Buyer shall remain liable on its obligations under
Sections 4.2 and 15.8.

     8.   EMINENT DOMAIN. In the event that any eminent domain proceedings shall
be commenced prior to the Closing affecting (i) any of the parking area(s)
within the Real Estate or any access roadway serving the Real Estate that is not
replaced by an access roadway in a comparable location with respect to the Real
Estate; or (ii) which is of such a nature as would permit any tenant occupying
leased premises to cancel its Space Lease, Buyer shall have the right to
terminate this Agreement, by written notice given to Seller within three (3)
days after the event, (in which case the Deposit shall forthwith be returned to
Buyer, whereupon the Agreement shall be null and void and of no further force or
effect whatsoever). In any case wherein Buyer has the right to terminate this
Agreement pursuant to this Section 8 and Buyer elects not to terminate, or in
any case wherein Buyer does not have the right to terminate, Buyer and Seller
shall consummate Closing on the Closing Date, without any reduction to or
abatement of the Purchase Price, and all theretofore unpaid condemnation awards
shall belong to Buyer.

     9.   NO ASSIGNMENT. Buyer shall not have the right to assign this Agreement
or its rights under this Agreement without obtaining in each instance Seller's
prior written consent. Notwithstanding the foregoing, Buyer shall have the
right, without Seller's consent, to assign its entire right, title and interest
in and to this Agreement, expressly including the Deposit, to any entity
controlling, controlled by, or under common control with Buyer or Inland Real
Estate Trust, Inc., a Maryland corporation, (an "Affiliate"); provided that, not
less than three (3) business days prior to Closing, Seller receives an executed
assignment and assumption agreement, in a commercially reasonable form , which
expressly assigns the Deposit and in which such assignee expressly assumes
performance of this Agreement for the benefit of Seller. No such assignment or
designation shall relieve or release Buyer from any obligations under this
Agreement (whether arising pre- or post-closing), and Buyer shall remain jointly
and severally liable for all of same together with such assignee.

     10.  COVENANTS AND REPRESENTATIONS. As of the date hereof, and to the best
of Seller's knowledge, Seller covenants, warrants and represents to Buyer the
following:

          10.1    Seller has obtained any consents from partners and/or
shareholders required to permit the transactions contemplated by this Agreement
including the sale of the Property to Buyer.

          10.2    There is no pending or threatened litigation affecting the
Property brought by or against Seller that would materially adversely affect
Buyer except as set forth in EXHIBIT 7 attached hereto and made a part hereof.
If Seller is served with process or receives notice that litigation relating to
the Property has been commenced against it, Seller shall promptly notify Buyer.
The provisions of this Section shall not apply to any litigation relating to the
property involving personal injury or property damage(s) covered by insurance.

          10.3    The Space Leases described in EXHIBIT 2 comprise all the Space
Leases presently existing, and same have not been materially amended or modified
except (if at all) as may be set forth in Exhibit 2. Seller has neither given
nor received any outstanding, uncured notice of default to or from any Space
Lease tenant. Following a date which is five (5) business days prior to the
expiration of the Due Diligence Period (the "Cut Off Date"), and prior to
Closing, Seller will not, without the prior written consent of Buyer(which Buyer
agrees not to reasonably withhold or delay), cancel (except for default by a
tenant) or materially amend any Space Lease, or enter into any new Space Lease
or any Service Contract affecting the Property not cancelable on 30 days notice.
On or prior to the Cut Off Date, Seller may take any of the foregoing actions
without Buyer's consent, provided it delivers a copy of any new documentation
evidencing same to Buyer not later than three (3) business days prior to the
expiration of the Due Diligence Period.

          10.4    Except as otherwise expressly provided herein, there are no
contracts or agreements affecting the Property other than the Service Contracts,
Space Leases and Permitted Exceptions; and there are no on-site employees or
hired persons in connection with the management,

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operation or maintenance of the Property; and Buyer shall have no obligation,
liability or responsibility with respect to charges, salaries, vacation pay,
fringe benefits or like items subsequent to Closing, nor with any management or
employment agreements with respect to the Property.

          10.5    The signatories to this Agreement on behalf of Seller have the
power and authority to enter into this Agreement and to bind Seller to the
provisions hereof.

          10.6    As of the date hereof: (i) to Scott Archer's knowledge Seller
is not aware of and has receive no building code violation notices with respect
to the Property (other than notices of violations which have been removed or
corrected); and (ii) to Scott Archer's knowledge Seller is not aware of and has
received no notices of any action or governmental proceeding in connection with
eminent domain, or for a zoning change, which would affect the Property; and
(iii) to Scott Archer's knowledge Seller is not aware of any structural problems
in the improvements constructed upon the Property and the exterior structures
are in good condition and repair.

          10.7    Seller represents that there are no payment or performance
obligations outstanding of Seller under the Development Agreement and that there
are no such other like unrecorded development agreements.

     11.  THE CLOSING.

          11.1    The Closing shall be held at the Title Company's offices (at
the address set forth above) at 9:00 A.M. on the Closing Date. The Closing Date
shall be ten (10) business days after the expiration of the Due Diligence
Period.

          11.2    At Closing, Buyer shall pay the Purchase Price as adjusted in
accordance with the provisions of this Agreement; and Buyer shall execute and
deliver such other instruments as Seller may reasonably request in connection
with or to consummate the transactions contemplated by this Agreement.

          11.3    (A)    At Closing, Seller shall deliver to Buyer the
following:

          (a)     A special warranty deed in favor of Buyer for the Real Estate
in proper recordable form, duly executed and acknowledged by Seller.

          (b)     A F.I.R.P.T.A. affidavit.

          (c)     It shall be a condition precedent to Buyer's obligation to
remit the remainder of the Purchase Price to the Title Company on the Closing
Date and effectuate the transaction contemplated herein that on or before the
third (3rd) business day prior to the Closing Date, Buyer shall have received an
estoppel certificate from each tenant under a Space Lease who occupies more than
eight thousand (8,000) square feet (hereinafter "Anchor Tenant"), as well as
from seventy (70%) percent of the tenants occupying less than eight thousand
(8,000) square feet (each such tenant hereinafter referred to as a "Non-Anchor
Tenant") (collectively such Non-Anchor Tenants hereinafter referred to as the
"Minimum Threshold"), each such estoppel to be dated not more than 30 days prior
to the Closing Date, in either the form required by its Space Lease, or
otherwise in the form attached hereto as Exhibit 10, and made a part hereof, as
well as Seller's estoppel in the form of Exhibit 10 for any tenant (other than
an Anchor Tenant and so long as the Minimum Threshold is met) not delivering an
estoppel as required to achieve one hundred percent (100%) estoppel delivery for
the Property. . If Seller is unable to obtain any such required estoppel from a
tenant prior to Closing, Seller shall deliver its own estoppel in the form
attached as Exhibit 10 (provided, however, Buyer shall not be obligated to
accept Seller's estoppel for any Anchor Tenant nor for more than thirty (30%)
percent of the Non-Anchor Tenants at the Property), which shall survive Closing
(but if post-Closing Seller delivers any such tenant estoppel, Seller shall be
relieved from responsibility under any Seller estoppel it delivered regarding
all matters confirmed by such tenant estoppel). If Seller fails to deliver any
such required estoppel, Seller shall have no liability by reason thereof
provided, however that Seller shall not be required to deliver its own estoppel
containing an assertion that Seller in good faith believes to be untrue, and
Buyer's sole right shall be to terminate this Agreement and to obtain a refund
of the Deposit as set forth in Section 14.3. If any estoppel certificate is
dated earlier than forty (40) days prior to the Closing Date, in lieu of
requiring Seller to obtain a new estoppel from the subject tenant(s), which
shall be required of Seller if any estoppel certificate is dated earlier than
sixty (60) days prior to the Closing Date, Buyer agrees that Seller may deliver,
at Closing, its representation that to the best of Seller's knowledge, the facts
in said estoppel remain true in all material respects as of the Closing Date.

          (d)     Seller shall use its commercially reasonable good faith
efforts to obtain, prior to the expiration of the Due Diligence Period, an
estoppel certificate from each party to, or affected by any

10
<Page>

declaration, ASSOCIATION, reciprocal easement, or like agreement affecting the
Property (hereinafter "REA estoppel"). Seller will request that the estoppel be
in a form substantially similar to the form attached hereto as Exhibit 11 and
made a part hereof. In the alternative, within five (5) days of the date this
Agreement is fully executed by Seller and Buyer, Seller shall provide Buyer with
the necessary information for each REA party such that during the Due Diligence
Period, Buyer may request the REA estoppel from the REA parties directly. In the
event Seller and Buyer are unable to obtain these estoppels despite Seller's
commercially reasonable good faith efforts prior to the expiration of the Due
Diligence Period, Seller may deliver and Buyer may accept (although nothing
contained herein shall require Buyer to accept), its own estoppel in the form
attached as Exhibit 11, which shall survive Closing (but if post-Closing Seller
delivers any such REA estoppel, Seller shall be relieved from responsibility
under any Seller estoppel it delivered regarding all matters confirmed by such
"REA" estoppel).

          (c) It shall be a condition precedent to Buyer's obligation to remit
the remainder of the Purchase Price to the Title Company on the Closing Date and
effectuate the transaction contemplated herein that on or before the third (3rd)
business day prior to the Closing Date, Buyer shall have received an assignment
of all warranties and guaranties, if available, for materials and workmanship
benefiting the Property, including an acknowledgment by the material and/or
service provider of the acceptance of the assignment where required by the terms
of the warranty and/or guaranty, with all fees and costs of such assignment (and
inspection, if required) (not to exceed One Thousand Dollars ($1,000.00)) being
paid at the sole cost and expense of Seller; any such costs or fees in excess of
One Thousand Dollars ($1,000.00) being shared equally between the parties
hereto.

                  (B)    At Closing, Seller and Buyer shall each execute and
deliver to the other the following:

          (a)     An Assignment and Assumption Agreement for the Space Leases in
          the form of EXHIBIT 4 attached hereto.

          (b)     An Assignment and Assumption Agreement for the Service
          Contracts, in the form of EXHIBIT 5 attached hereto.

          (c)     Notices to tenants, in the form attached hereto as Exhibit 14,
          and made a part hereof, notifying them of the sale and (if applicable)
          the transfer of their security deposit to Buyer.

          (d)     A Master Lease for a term expiring on the earlier of (i)
          twelve (12) months or (ii) such date as Seller leases the remaining
          vacant space to achieve 100% Lease-up of the Rent Roll. However
          subject to the terms of the immediately following sentence,
          notwithstanding the rent rate per square foot set forth in the Rent
          Roll for the vacant space in the event Seller leases a portion of said
          vacant space at a per square foot rate that is greater than provided
          for on the Rent Roll, then it shall have the right to lease other
          vacant space at a lesser rate per square foot than as shown on the
          Rent Roll up to the excess rent so achieved. Lease-up of the Property
          shall in no event yield an average Fixed Rent and Reimbursements
          amount that is less than the sum of Fixed Rent and Reimbursements per
          the Rent Roll. The Master Lease shall be in the form of Exhibit 8
          attached hereto and shall incorporate that portion of the Property
          vacant space for which a bona fide Space Lease(s) has not been
          executed as of the date of Closing with the "Tenant Conditions" (as
          hereinafter defined) having been satisfied. For the purposes hereof,
          the Tenant Conditions for any Property vacant space gross leasable
          area are hereby defined as (i) a signed lease, and (ii) with Tenant
          either paying full rent and reimbursements or the all conditions
          precedent to Rent Commencement Date (as defined in such tenant lease)
          shall have occurred or been satisfied and (iii) with all the leasing
          commissions and tenant improvement allowances either paid for by
          Seller or credited to Buyer and (iv) with a certificate of occupancy
          or its equivalent occupancy permit issued by the local governmental
          authorities, for such tenant's respective demised premises. If a bona
          fide Space Lease for the Vacant Space or any portion thereof with the
          Tenant Conditions satisfied is executed prior to the Closing Date,
          the parties shall either not enter into a Seller Lease or the
          applicable provisions thereof (including but not limited to the annual
          base rent) shall be adjusted accordingly to reflect that portion of
          the Vacant Space that is leased and thus released and not covered by
          the Master Lease. It is the intent of the parties that the Master
          Lease shall be for all Property vacant space notwithstanding the
          foregoing in calculating the sums due under the Master Lease same
          shall be reduced by Thirty Eight Thousand and 00/100 ($38,000). Seller
          acknowledges and agrees that it shall be responsible for placing all
          vacant space in Vanilla Box condition however, it may be satisfied by
          second generation space in "as is" condition such that a tenant has
          already occupied same, and needn't be in "new" condition.

11
<Page>

          (e)     The Buyer Declaration.

          11.4    Each party shall pay its own legal fees and travel and lodging
expenses in connection with this transaction. Seller shall pay for all transfer
taxes and the parties shall each pay 1/2 of the documentary stamps or recording
charges for transfer of title to the Real Estate and the "New York Style"
closing escrow fees charged by the Title Company.

          11.5    Buyer also agrees to cooperate with Seller to permit the
conveyance of the Property to be consummated as a part of a transaction intended
by Seller to qualify as a tax-free exchange under Section 1031 of the Internal
Revenue Code and in conjunction therewith to execute such documents as Seller
may reasonably request (such cooperation may include, without limitation,
accepting a conveyance from a party other than Seller and paying the Purchase
Price to a party other than Seller). In no event, however, shall (a) Buyer bear
any expense associated with the exchange transaction, (b) Buyer be obligated to
take title to Seller's exchange property, (c) the consummation of such tax-free
exchange materially delay the conveyance to Buyer of the Property, (d) Buyer
have any liability to Seller or any other party for the qualification of the
exchange transaction for tax-free exchange treatment under Section 1031 of the
Internal Revenue Code or under any other provision and (e) the consummation of
such tax free exchange relieve Seller of any of its obligations hereunder.

          11.6    Buyer acknowledges and agrees that any and all sales tax
inducements and "Rebate of Costs" as provided for in the Development Agreement,
some of which may be allocated for Improvement located on the Real Estate,
belong to Seller.

     12.  BROKERS.

          Each party represents and warrants to the other that it dealt with no
broker other than Kimco Exchange Corporation (the "Broker") in connection with
this transaction. Seller shall pay Broker pursuant to a separate agreement. Each
party agrees to defend, indemnify and hold the other harmless from and against
any and all loss, liability and expense, including reasonable attorney's fees,
that the indemnitee may incur arising by reason of the above representation by
the indemnitor being false. The provisions of this Section 12 shall survive
Closing.

     13.  NOTICES.       All notices, demands, requests, consents, approvals or
other communications (for the purpose of this Section collectively called
"Notices") required or permitted to be given hereunder or which are given with
respect to this Agreement shall be valid only if in writing and sent by
registered or certified United States mail, return receipt requested, postage
prepaid, or delivered by Federal Express or UPS courier service, addressed as
follows:

          To Seller:         8383 Wilshire Boulevard
                             Suite 950
                             Beverly Hills, CA 90211
                             Attn: Jerald Friedman
                             Phone: (323) 866-3519
                             Fax: (323) 866-3511

                             with a copy to:

                             3333 New Hyde Park Road
                             Suite 100
                             New Hyde Park, New York 11042
                             Attn: Barbara E. Briamonte, Esq.
                             Phone: (516) 869-7157
                             Fax: (516) 869-7201

          and a copy to:     Barclay Group
                             15974 N. 77th Street
                             Suite 100
                             Scottsdale, AZ 85260
                             Attn: Scott Archer
                             Phone: (480) 596-9399
                             Fax: (480) 596-6366

          To Buyer:          Inland Real Estate Acquisitions, Inc.
                             2901 Butterfield Road Oakbrook, IL, 60523
                             Phone: (630) 218-4948

12
<Page>

                             Fax: (630) 218-4935
                             Attention: G. Joseph Cosenza

                             with a copy to:

                             The Inland Group, Inc.
                             2901 Butterfield Road
                             Oak Brook, IL 60523
                             Attn: Robert Baum, General Counsel
                             Facsimile Nos: (630) 218-4900
                             Copy via facsimile:
                             Charles R. Benvenuto (630) 571-2360

          To Escrow Agent:   CHICAGO TITLE & TRUST COMPANY
                             171 North Clark Street
                             Chicago, Illinois 60601
                             Attn: Nancy Castro, Escrow Agent
                             Phone: (312) 223-2709
                             Fax: (312) 223-2108

or such other address as such party shall hereafter have specified by Notice
given by the same means. Any Notice shall be deemed given when delivered to the
carrier delivering same, delivery charges prepaid, and properly sealed and
addressed. Any Notice may also be given by telecopier to the following numbers:
Seller (516) 869-7201, Buyer (843) 852-3675, (630) 218-4935, and (630)
218-4900;, and Escrow Agent (312) 223-2108, Attn: Nancy Castro, provided that a
"hard copy" of such notice is sent within one (1) business day after such
telecopier transmission in the manner above set forth; and in the case of notice
by telecopier (with confirmation sent as aforesaid), notice shall be deemed
given upon electronic confirmation of receipt.

     14.  DEFAULTS.

          14.1    If Closing does not take place because of Buyer's default the
Deposit shall be retained by Seller as agreed upon liquidated damages as
Seller's sole remedy for such default, and thereupon this Agreement shall be
null and void and of no further force or effect whatsoever (except that Buyer
shall remain liable on its obligations under Sections 4.2 and 15.8). The parties
hereto expressly agree that Seller's actual damages in the event of a default by
Buyer would be extremely difficult or impractical to ascertain and that the
amount of the Deposit represents the parties' reasonable estimate of such
damages.

          14.2    If Closing does not occur due to Seller's willful default and
refusal to close despite Buyer's willingness to do so (such willingness includes
waiver by Buyer of any uncured title objection properly made by Buyer under
Section 6.1 or material breach of representation or warranty by Seller) (such
willful default and refusal being hereinafter referred to as a "Seller
Default"), then Buyer, as its sole and exclusive right and remedy as a result of
such Seller Default, may elect to either (i) cancel this Agreement, in which
event the Deposit shall be returned to Buyer, Seller shall be liable for any
title and survey costs, as well as environmental site assessment, appraisal and
legal fees theretofore incurred by Buyer (however Seller shall not be obligated
to reimburse Buyer more than Twenty-Five Thousand Dollars ($25,000.00) in the
aggregate for such environmental site assessment, appraisal and legal fees), and
thereupon no party shall have any further right or obligation hereunder (except
that Buyer shall remain liable on its obligations under Sections 4.2 and 15.8),
or (ii) Buyer may enforce specific performance of this Agreement without any
reduction or abatement of the Purchase Price, together with the right of Buyer
to collect its reasonable attorney's fees and costs of suit, subject to the
limitation on Landlord's reimbursement of same described above.

          14.3    Subject to the provisions of Article 14.1 and 14.2 above, if
Closing should not occur for any reason whatsoever other than a default by Buyer
or a Seller Default (including without limitation by reason of a material breach
of representation or warranty of Seller or an uncured title objection properly
made by Buyer under Section 6.1, or a failure to deliver any tenant estoppel
required hereunder) which Buyer is not willing to waive, then in such event this
Agreement shall be and be deemed cancelled, the Deposit shall be returned to
Buyer, and thereupon Buyer shall have no other right, by way of damages or
otherwise, against Seller notwithstanding the existence of any failure or breach
of representation, warranty, covenant, title, provision of estoppel or other
Closing condition (provided that Buyer will remain liable on its obligations
under Sections 4.2 and 15.8).

     15.  MISCELLANEOUS.

13
<Page>

          15.1    The representations, warranties and covenants contained in
Article 10 of this Agreement shall survive delivery of the deed for a period of
twelve (12) months. Other than the survival of such representations, warranties
and covenants, the acceptance of the deed by Buyer shall be conclusive evidence
of the performance by Seller of all of the provisions of this Agreement to be
performed by Seller.

          15.2    This Agreement (including the Exhibits attached hereto)
contains the entire agreement between the parties with respect to the subject
matter hereof and supersedes all prior or contemporaneous understandings, if
any, with respect thereto.

          15.3    This Agreement may not be canceled, modified, changed or
supplemented, nor may any obligation hereunder be waived, except by written
instrument signed by the party to be charged or by its agent duly authorized in
writing.

          15.4    The parties do not intend to confer any benefit hereunder on
any person, firm or corporation other than the parties hereto and their
respective successors or assigns.

          15.5    "TIME IS OF THE ESSENCE" with respect to all provisions of
this Agreement, with the sole exception that each of Buyer and Seller shall be
entitled to a single adjournment (not to exceed two (2) business days in any
event) of the Closing Date.

          15.6    This Agreement shall extend to and be binding upon the legal
representatives, heirs, executors, administrators and, subject to the provisions
of this Agreement, the permitted assigns of the parties hereto.

          15.7    Intentionally Deleted.
          15.8    Buyer represents and warrants that it will keep all
information and/or reports and/or documents obtained from Seller or its agents
(including without limitation the rent and other terms of the Space Leases), or
related to or connected with the Property (including without limitation the
existence of this Agreement and the Purchase Price) strictly confidential and
will not disclose any such information to any person or entity (except for
Buyer's attorneys, consultants and advisors and except as required by law;
provided that any such parties similarly agree to treat such material
confidentially), without the prior written consent of Seller. In amplification
and not in limitation of the foregoing, Buyer may not make any public disclosure
of the existence or terms of this Agreement prior to Closing.

          15.9    This Agreement shall be governed by, interpreted under, and
construed and enforced in accordance with, the laws of the State wherein the
Property is located. This Agreement shall be construed in accordance with its
plain meaning and without reference to any maxim or rule of interpretation
providing that a writing should be construed against the party responsible for
the drafting thereof.

          15.10   This Agreement shall not be recorded or filed in the public
records of any jurisdiction by either party and any attempt to do so may be
treated by the other party as a breach of this Agreement.

          15.11   This Agreement may be executed in one or more counterparts,
                  each of which when so executed and delivered shall be deemed
                  an original.

     16.  Conditions Precedent to Buyer's Obligation.

          In addition to the conditions precedent described in Article 11.3(A)
          (c), (d) & (e), Buyer's obligation to remit the remainder of the
          Purchase Price to the Title Company on the Closing Date and effectuate
          the transaction contemplated hereunder is subject to and contingent
          upon the following:

          (a)  The Title Company's issuing or committing to issue the Title
               Policy insuring that fee simple title to the Property is vested
               in Buyer as required in Article 6 hereof;

          (b)  The completeness, truth and accuracy in all material respects and
               to the best of Scott Archer's knowledge of the Rent Roll, and any
               certifications, schedules, covenants and statements prepared and
               executed by Seller as part of the Pre-Closing Deliveries, the
               completeness in all material respects and to the best of Seller's
               knowledge of the Space Leases delivered by Seller as part of the
               Pre-Closing Deliveries, the completeness, truth and accuracy in
               all material respects and to the best of Seller's knowledge as of
               Closing, of the representations and warranties of

14
<Page>

               Seller contained in Section 10 hereof, and the performance by
               Seller, to the extent possible by the date of Closing, of the
               covenants contained in Section 10 hereof. It shall be a condition
               to Buyer's obligation to close with respect to the Property that,
               at the Closing, Seller shall deliver to Buyer a Certificate that
               shall confirm, to the best of Seller's knowledge, the truth and
               accuracy in all material respects, as of Closing, of Seller's
               representations contained in this Agreement, and the
               representations contained in such certificate, as well as any
               continuing obligations of Seller hereunder, shall survive the
               Closing for a period of twelve (12) months; and

          (c)  That as of the date of closing: (i) neither Seller, as landlord
               under the Space Leases, nor any tenant thereunder, shall be in
               material default under the terms of any Space Lease and (ii) and
               eighty-five percent (85%) of the Property gross leasable area
               being leased to tenants with the Tenant Conditions satisfied.

                       [SEE SIGNATURE BLOCKS ON NEXT PAGE]

15
<Page>

     IN WITNESS WHEREOF, Seller and Buyer have executed this Agreement as of the
day and year first above written.

                                     BUYER: INLAND REAL, ESTATE
                                            ACQUISITIONS, INC.

WITNESSES:

                                     By: /s/ G. Joseph Cosenza
-----------------------                 --------------------------------------
                                        Name: G. Joseph Cosenza
                                        Title: President
-----------------------                 Date of Execution:       1-7-04
                                                          --------------------

                                        SELLER:  KIMCO BARCLAY PEORIA
                                        CROSSING, L.P.

                                        BY:  KIMCO PEORIA 476, INC.
                                             ITS GENERAL PARTNER

WTTNESSES:

[ILLEGIBLE]                          By: /s/ Bruce M. Kauderer
-----------------------                 --------------------------------------
                                        Name: BRUCE M. KAUDERER
[ILLEGIBLE]                             Title: Vice President
-----------------------                 Date of Execution:
                                                          --------------------

                                     Escrow Agent signs to confirm its
                                     agreement with the provisions of
                                     Section 3(A)(ii) hereof;

WITNESSES:                           ESCROW AGENT: CHICAGO TITLE & TRUST
                                               COMPANY

                                     By:
-----------------------                 --------------------------------------
                                        Name: Nancy Castro
                                        Title:
-----------------------                 Date of Execution:
                                                          --------------------

16
<Page>

     IN WITNESS WHEREOF, Seller and Buyer have executed this Agreement as of the
day and year first above written.

                                     BUYER: INLAND REAL ESTATE
                                            ACQUISITIONS, INC.

WITNESSES:

                                     By: /s/ [ILLEGIBLE]
-----------------------                 --------------------------------------
                                        Name: [ILLEGIBLE]
                                        Title: [ILLEGIBLE]
-----------------------                 Date of Execution:       1-7-04
                                                          --------------------

                                     SELLER:  K1MCO BARCLAY PEORIA
                                     CROSSING, L.P.

                                     BY:  KIMCO PEORIA 476, INC.
                                          ITS GENERAL PARTNER

WITNESSES:

                                     By:
-----------------------                 --------------------------------------
                                        Name:
                                        Title:
-----------------------                 Date of Execution:
                                                          --------------------

                                     Escrow Agent signs to confirm its
                                     agreement with the provisions of
                                     Section 3(A)(ii) hereof:

WITNESSES:                           ESCROW AGENT: CHICAGO TITLE & TRUST
                                               COMPANY

                                     By:
-----------------------                 --------------------------------------
                                        Name: Nancy Castro
-----------------------                 Title:
                                        Date of Execution:
                                                          --------------------

16
<Page>

                              SCHEDULE OF EXHIBITS

1.      Real Estate

2.      Space Leases

3.      Service Contracts

4.      Assignment and Assumption Agreement - Space Leases

5.      Assignment and Assumption Agreement - Service Contracts

6.      Permitted Exceptions

7.      Schedule of Litigation

8.      Form of Master Lease

9.      Site Plan of Vacant Space

10.     Form of Tenant and Guarantor Estoppel

11.     Form of REA estoppel

12.     Due Diligence Checklist

13.     Surveyor's Certification

14.     Tenant Notice Letter

15.     Intentionally Deleted

17
<Page>

                                    EXHIBIT 1

                                   REAL ESTATE

                                   [TO FOLLOW]

                                  See Site Plan

18
<Page>

                                                                Job No.:81566014
                                                                  Date: 11/18/03

                                   DESCRIPTION
                                      LOT 1
                                PEORIA CROSSINGS

A portion of the Southeast Quarter of Section 33, Township 3 North, Range 1 East
of the Gila & Salt River Base & Meridian, Maricopa County, Arizona, more
particularly described as follows:

COMMENCING at the Southeast corner of said Section 33;
Thence S.88 DEG.40'25"W., a distance of 1992.52 feet along the South line of the
Southeast Quarter of said Section 33;
Thence departing said South line N.00 DEG.00'00"E., a distance of 65.02 feet to
the POINT OF BEGINNING;
Thence S.88 DEG.40'25"W., a distance of 106:88 feet along a line 65.00 feet
North of and parallel to the South line of said Section 33;
Thence N.00 DEG.00'00"E., a distance of 69.11 feet to a Point on a Curve, the
central point bears N.88 DEG.30'02"E., a distance of 392.02 feet from said Point
on a Curve;
Thence Northeasterly along said curve being concave to the Southeast, through a
central angle of 26 DEG.55'20", having an arc length of 184.20 feet;
Thence departing said curve N.59 DEG.21'32"W., a distance of 261.62 feet;
Thence S.00 DEG.00'54"W., a distance of 385.34 feet;
Thence S.88 DEG.40'25"W., a distance of 34.98 feet;
Thence N.00 DEG.00'54"E., a distance of 350.09 feet;
Thence S.88 DEG.40'25"W., a distance of 276.30 feet;
Thence N.25 DEG.06'59"E., a distance of 560.69 feet;
Thence N.42 DEG.4l'49"E., a distance of 422.86 feet;
Thence S.90 DEG.00'00"E., a distance of 224.79 feet;
Thence S.00 DEG.00'00"W., a distance of 321.72 feet;
Thence S.90 DEG.00'00"E., a distance of 83.84 feet;
Thence S.00 DEG.00'00"W., a distance of 416.56 feet to a Point on a Curve, the
central point bears S.07 DEG.59'33"E., a distance of 359.24 feet from said Point
on a Curve;
Thence Easterly along said curve being concave to the South, through a central
angle of 04 DEG.11'44", having an arc length of 26.31 feet;
Thence departing said curve S.90 DEG.00'00"E., a distance of 4.10 feet;
Thence S.00 DEG.00'00"W., a distance of 16.62 feet;
Thence S.84 DEG.27'36"W., a distance of 15.37 feet;
Thence S.79 DEG.05'53"W., a distance of 38.73 feet;
Thence S.74 DEG.10'14"W., a distance of 19.46 feet;
Thence S.68 DEG.08'00"W., a distance of 34.11 feet;
Thence S.61 DEG.l1'42"W., a distance of 29.63 feet;
Thence S.53 DEG.26'55"W., a distance of 55.73 feet;

<Page>

Thence S.45 DEG.01'39"W., a distance of 74.58 feet;
Thence S.40 DEG.30'40"W., a distance of 27.55 feet;
Thence S.22 DEG.51'42"W., a distance of 17.45 feet;
Thence S.28 DEG.12'57"W., a distance of 13.61 feet;
Thence S.00 DEG.00'00"W., a distance of 226.31 feet to the POINT OF BEGINNING;

Said Lot containing 523,102 square feet or 12.01 acres more or less and being
subject to any easements, restrictions or rights-of way of record or otherwise.

<Page>

                                  AMENDED PLAT
                                       OF
                               "PEORIA CROSSINGS"
              LOTS 1, 3, 4, 7, 8, 9, 11, 12, 13, 14, 15, 20 AND 23
            AS RECORDED IN BOOK 649, PAGE 14 MARICOPA COUNTY RECORDS
              AND LOCATED IN A PORTION OF THE SOUTHEAST QUARTER OF
                SECTION 33, TOWNSHIP 3 NORTH, RANGE 1 EAST OF THE
        GILA AND SALT RIVER BASE AND MERIDIAN, MARICOPA COUNTY, ARIZONA.

[GRAPHIC]

[ILLEGIBLE]

<Page>

                                                               Job No.: 81505020
                                                                  Date: 11/18/03

                                   DESCRIPTION
                                      LOT 3
                                PEORIA CROSSINGS

A portion of the Southeast Quarter of Section 33, Township 3 North, Range 1 East
of the Gila & Salt River Base & Meridian, Maricopa County, Arizona, more
particularly described as follows:

COMMENCING at the Southeast corner of said Section 33;
Thence N.00 DEG.0l'24"W., a distance of 1323.31 feet along the East line of the
Southeast Quarter of said Section 33;
Thence departing said East line S.88 DEG.32'54"W., a distance of 637.28 feet
along the North line of the South Half of said Southeast Quarter to the POINT OF
BEGINNING;
Thence S.01 DEG.27'06"E., a distance of 132.38 feet;
Thence S.00 DEG.00'00"W., a distance of 161.80 feet;
Thence N.90 DEG.00'00"W., a distance of 138.00 feet;
Thence S.00 DEG.00'00"W., a distance of 158.54 feet;
Thence S.14 DEG.35'09"E., a distance of 82.29 feet;
Thence S.11 DEG.14'19"E., a distance of 82.16 feet;
Thence S.26 DEG.58'12"E., a distance of 31.05 feet;
Thence S.00 DEG.00'06"W., a distance of 378.67 feet to a Point on a Curve, the
central point bears S.60 DEG.10'44"W., a distance of 265.03 feet from said Point
on a Curve;
Thence Northwesterly along said curve being concave to the Southwest, through a
central angle of 29 DEG.59'36", having an arc length of 138.74 feet to a Point
on a Curve, the central point bears S.29 DEG.57'19"W., a distance of 395.51
feet from said Point on a Curve;
Thence Northwesterly along said curve being concave to the Southwest, through a
central angle of 31 DEG.48'26", having an arc length of 219.56 feet;
Thence departing said curve N.90 DEG.00'00"W., a distance of 110.54 feet;
Thence N.00 DEG.00'00"E., a distance of 400.19 feet;
Thence S.90 DEG.00'00"E., a distance of 46.35 feet;
Thence N.00 DEG.00'01"W., a distance of 303.00 feet;
Thence N.01 DEG.23'23"W., a distance of 154.56 feet;
Thence N.88 DEG.32'54"E., a distance of 458.88 feet along said North line of the
South Half of said Southeast Quarter to the POINT OF BEGINNING.

Said Lot containing 363,336 square feet or 8.34 acres more or less and being
subject to any easements, restrictions or rights-of-way of record or otherwise..

<Page>

[GRAPHIC]

<Page>

                                                               Job No.: 81505020
                                                                  Date: 12/16/03

                                   DESCRIPTION
                                KOHL'S EXPANSION
                                PEORIA CROSSINGS

     A portion of the Southeast Quarter of Section 33, Township 3 North, Range 1
     East of the Gila & Salt River Base & Meridian, Maricopa County, Arizona,
     more particularly described as follows:

     COMMENCING at the Southeast corner of said Section 33;
     Thence N.00 DEG.O1'24"W., a distance of 1323.31 feet along the East line of
     the Southeast Quarter of said Section 33;
     Thence departing said East line S.88 DEG.32'54"W., a distance of 691.94
     feet along the North line of the South Half of said Southeast Quarter;
     Thence departing said North line S.00 DEG.00'00"W., a distance of 162.75
     feet to the POINT OF BEGINNING;
     Thence continuing S.00 DEG.00'00"W., a distance of 250.00 feet;
     Thence N.90 DEG.00'00"W., a distance of 80.00 feet;
     Thence N.00 DEG.00'00"E., a distance of 250.00 feet;
     Thence S.90 DEG.00'00"E., a distance of 80.00 feet to the POINT OF
     BEGINNING.

     Said Expansion containing 20,000 square feet or 0.459 acres more or less
     and being subject to any easements, restrictions or rights-of-way of record
     or otherwise..

<Page>

                                    EXHIBIT 2

                                  SPACE LEASES

19
<Page>

                                    EXHIBIT 2

                                  SPACE LEASES

<Table>
<Caption>
                                                                                        1st Amendment 2nd Amendment
                                                                                          Date (If      Date (If
Building                   Tenant                        Business Name    Date of Lease  Applicable)   Applicable)
-------------------------------------------------------------------------------------------------------------------
<S>       <C>                                       <C>                      <C>          <C>            <C>
Major A   Petco Animal Supplies, Inc.               Petco                    02/07/02
Major B   Michaels Stores, Inc.                     Michaels                  no date
Major C   Ross Stores, Inc.                         Ross Dress For Less      08/09/02
Major D   Brown Group Retail, Inc.                  Famous Footwear          12/14/01
Major E   The Dress Barn, Inc.                      Dress Bam                09/04/02
Major F   Anna's Linen Company                      Anna's Linens            04/02/03
Major L   Kohl's Department Stores, Inc.            Kohl's                    May-02
Pad G     2 B Wireless, Inc.                        Voice Stream Wireless    12/04/01
Pad G     Electronics Boutique of America, Inc.     EB Games                 03/05/02
Pad G     Motherlode, Inc.                          M.E.E. Music             01/30/03
Pad G     Shear Quality, Inc.                       Great Clips              06/25/01     04/28/03
Pad G     Sleep America, Inc.                       Sleep America            07/20/01     10/28/02
Pad K     Arizona Grande Cibo, Inc.                 Sarpino's Pizzeria       11/08/02     08/13/03
Pad K     Cold Stone Creamery Leasing Company, Inc. Cold Stone Creamery      03/13/02     07/08/03       11/01/03
Pad K     Dung Duy Ha and Huong T. Duong            Nail Salon               10/01/03
Pad K     Jeffrey A. Glazier and Lana C. Glazier    It's A Grind               draft
Pad K     KSV Enterprises, LLC                      Quizno's                 01/08/02
Pad K     Panda Express, Inc.                       Panda Express              10/02
Pad K     Supercuts, Inc.                           Supercuts                01/21/03
Shops A   Claire's Boutiques, Inc.                  Claire's                 11/07/02
Shops A   Payless Shoesource, Inc.                  Payless ShoeSource       09/23/03
Shops A   Sally Beauty Company, Inc.                Sally Beauty Supplies    04/11/02

<Caption>
Building                   Tenant                       Other Documents (If Applicable)*
--------------------------------------------------------------------------------------------
<S>       <C>                                       <C>
                                                    Letter Agreement re: square footage
Major A   Petco Animal Supplies, Inc.               dated 02/11/03
                                                    Notice of Rent Commencement dated
                                                    11/02/02; Letter Agreement dated
Major B   Michaels Stores, Inc.                     05/22/02
                                                    Acknowledgement of Commencement dated
                                                    06/24/03; Memorandum of Lease dated
Major C   Ross Stores, Inc.                         08/13/02
Major D   Brown Group Retail, Inc.
Major E   The Dress Barn, Inc.
Major F   Anna's Linen Company
Major L   Kohl's Department Stores, Inc.            Memorandum of Lease dated May 7, 2002
Pad G     2 B Wireless, Inc.
                                                    Commencement Date Agreement dated
Pad G     Electronics Boutique of America, Inc.     08/07/03
Pad G     Motherlode, Inc.                          Guaranty dated 01/30/03
Pad G     Shear Quality, Inc.
Pad G     Sleep America, Inc.
Pad K     Arizona Grande Cibo, Inc.                 Guaranty dated 11/08/02
Pad K     Cold Stone Creamery Leasing Company, Inc. Guaranty dated 03/13/02
Pad K     Dung Duy Ha and Huong T. Duong
Pad K     Jeffrey A. Glazier and Lana C. Glazier
Pad K     KSV Enterprises, LLC                      Lessor Agreement dated 01/08/02
Pad K     Panda Express, Inc.
Pad K     Supercuts, Inc.
Shops A   Claire's Boutiques, Inc.
Shops A   Payless Shoesource, Inc.
Shops A   Sally Beauty Company, Inc.
</Table>

<Page>

                                    EXHIBIT 3

                                SERVICE CONTRACTS

20
<Page>

                                    EXHIBIT 4

                       ASSIGNMENT AND ASSUMPTION OF LEASES

     THIS ASSIGNMENT, made this _______ day of ___________________, 2002 by and
between KIMCOBARCLAY PEORIA CROSSING, LIMITED PARTNERSHIP, an Arizona Limited
Partnership, ("Assignor") and INLANDREAL ESTATE ACQUISITIONS, INC., an Illinois
Corporation ("Assignee").

                              W I T N E S S E T H:

                                    EXHIBIT 3

                                SERVICE CONTRACTS

FIRE MONITORING, LEASE AND MAINTENANCE
Protection Systems
2430 S. 20th Street, Suite A
Phoenix, Arizona 85034
Phone: 602-275-8334

MONTHLY LIGHTING INSPECTIONS
GB Maintenance
6112 W.Julie Drive
Glendale, Arizona 85308
Phone: 623-537-3929

MONTHLY LANDSCAPING
ABM Landscape Services
2632 W. Medtronic Way
Tempe, Arizona 85281

MONTHLY DAYPORTER AND PARKING LOT SWEEPING
Pro-Sweep, LLC
P.O. Box 41901
Mesa, Arizona 85274-1901
Phone: 480-464-8050

MONTHLY SECURITY GUARD SERVICES
Alpha Security
6245 N. 35th Avenue
Phoenix, Arizona 85017
Phone: 602-544-1442

TRASH SERVICE
Waste Management of Arizona
1580 E. Elwood Street
Phoenix, Arizona 85040
Phone: 602-268-2222

<Page>

                                   EXHIBIT "A"

                                   [TO FOLLOW]

22
<Page>

                                   EXHIBIT "B"

                                   [TO FOLLOW]

23
<Page>

                                    EXHIBIT 5

                 ASSIGNMENT AND ASSUMPTION OF SERVICE CONTRACTS

     THIS ASSIGNMENT, made this _______ day of ________________, 2002 by and
between KIMCOBARCLAY PEORIA CROSSING, LIMITED PARTNERSHIP, an Arizona Limited
Partnership, ("Assignor") and INLANDREAL ESTATE ACQUISITIONS, INC., an Illinois
Corporation ("Assignee").

                              W I T N E S S E T H:

     Assignor is the owner of the property described on Exhibit "A" attached
hereto and made a part hereof ("Premises"). Assignor desires to assign to
Assignee, and Assignee desires to accept the assignment from Assignor of all of
Assignor's right, title and interest in and to those certain service contracts
relating to the Premises described on Exhibit "B" attached hereto and made a
part hereof ("Service Contracts").

     NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein, the parties hereto, intending to be legally bound hereby,
covenant and agree as follows:

     1.   Assignor hereby grants, transfers and assigns to Assignee, its
successors and assigns, all of the right, title and interest of the Assignor in
and to the Service Contracts. Assignor hereby indemnifies and agrees to defend
and hold Assignee harmless from and against all damages, claims, liabilities,
costs and expenses (including reasonable attorneys' fees) arising out of or
relating to the Service Contracts that accrue prior to the date hereof.

     2.   Assignee hereby accepts said assignment and assumes all of the
Assignor's duties and obligations arising out of the Service Contracts from and
after the date hereof. Assignee hereby indemnifies and agrees to defend and hold
Assignor harmless from and against all damages, claims, liabilities, costs and
expenses (including reasonable attorneys' fees) arising out of or relating to
the Service Contracts from and after the date hereof.

     3.   The provisions hereof shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns.

     IN WITNESS WHEREOF, Assignor and Assignee have each caused this Assignment
to be duly executed the day and year first above written.

                                ASSIGNOR:
                                KIMCO BARCLAY PEORIA CROSSING, L.P.

                                BY: Kimco Peoria 476, Inc., its general partner

                                By:
                                     --------------------------------------
                                Name:
                                Title:

                                ASSIGNEE:
                                INLAND REAL ESTATE ACQUISITIONS, an
                                Illinois Corporation

                                By:
                                     --------------------------------------
                                Name:
                                Title:

24
<Page>

                                   EXHIBIT "A"

                                   [TO FOLLOW]

25
<Page>

                                   EXHIBIT "B"

                                   [TO FOLLOW]

26
<Page>

                                    EXHIBIT 6

                              PERMITTED EXCEPTIONS

     1.   See Schedule 6A attached hereto and made a part hereof.

     2.   Laws and governmental regulations that affect the use and maintenance
of the Shopping Center.

     3.   Rights, if any, of any utility company to construct and/or maintain
lines, pipes, wires, cables, poles, conduits and distribution boxes and
equipment in, over, under, and/or upon the Real Estate or any portion thereof.

     4.   Current (tax year 2003-2004) Real Estate Taxes and assessments,
subject to apportionment as hereinafter set forth.

     5.   Rights, if any, of tenants under Space Leases.

     6.   The Service Contracts assumed by Buyer and approved by Buyer during
the Due Diligence Period .

     7.   Any and all other covenants, easements, reservations, agreements and
other matters, if any, of record as of the date of this Agreement; provided same
do not prohibit the maintenance of the Real Estate or the existing use thereof.
Should a dispute arise as to whether any of such matters prohibit the
maintenance or existing use of the Real Estate, Buyer agrees that same shall not
constitute a title objection if the title company shall affirmatively insure
that they do not prohibit such maintenance or existing use of the Real Estate.

     8.   Any matter than an accurate survey may show.

     9.   The REA.

     10.  The Grant of Easement to be executed by El Khazen Enterprises LLC
("Khazen") and Seller as provided for in the Agreement between Khazen and
Northern Loop Properties Limited Partnership; Sellers predecessor in interest
dated January 13, 1999 and recorded as Document Number 99-0117577 in the
Official Records of Maricopa County.

27
<Page>

                                  EXHIBIT "6-A"

               (Schedule "B" from Seller's Existing Title Policy)

28
<Page>

                                    EXHIBIT 7

                             SCHEDULE OF LITIGATION

                                   [TO FOLLOW]

29
<Page>

                                    EXHIBIT 8

                              FORM OF MASTER LEASE
                                  MASTER LEASE

                                ESCROW AGREEMENT

     This ESCROW AGREEMENT is made and entered into as of__________________,
2003, by and among Kimco Peoria Crossing, L.P., an Arizona Limited Partnership
("Seller"), and Inland Southeast, L.L.C., a Delaware limited liability company
("Purchaser"), and CHICAGO TITLE INSURANCE COMPANY (hereinafter referred to as
"Escrow Agent") having as its address - attention: Nancy Castro, Division II,
171 North Clark Street, Chicago, Illinois 60601.

                              W I T N E S S E T H:

     WHEREAS, pursuant to that certain Agreement of Sale, dated as of
_______________ (the "Contract"), Purchaser acquired on and as of the date
hereof from Seller a portion of that certain real property known as Peoria
Crossing shopping center located in Peoria, Arizona (the "Property"); and

     WHEREAS, Seller has agreed to deposit with Escrow Agent the sum of
____________________________________ and _________ Dollars ($_________________)
(the "Master Lease Deposit") with respect to Seller's obligation to pay certain
lease commissions, landlord's share of tenant build out, free rent periods, and
rent payable to Purchaser, and other charges, for the Vacant Space (as defined
below), and as itemized on EXHIBIT A attached hereto and made a part hereof by
this reference (the "Deposit Breakdown"); and

     WHEREAS, the Master Lease Deposit is hereafter sometimes referred to as the
Escrow Deposit.

     WHEREAS, Escrow Agent is willing to accept the Escrow Deposit and hold and
disburse same in accordance with the terms and conditions set forth below.

     NOW, THEREFORE, for and in consideration of the premises hereto, the
covenants and agreements hereinafter made, and for Ten Dollars ($10.00) in hand
paid to Escrow Agent, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

     1.   Seller hereby deposits with Escrow Agent, and Escrow Agent hereby
acknowledges receipt of the Master Lease Deposit. Escrow Agent hereby agrees to
deposit the Escrow Deposit into an interest bearing account with a bank, savings
and loan institution, money market account, or other depository reasonably
satisfactory to Purchaser, Seller and Escrow Agent, with interest accruing for
the benefit of Seller. The federal taxpayer identification of Seller is as
follows: 86-1011402 and the FEIN of Seller's general partner is86-1011235.

     2.   Escrow Agent shall retain the Escrow Deposit in the account, and shall
cause the same to be disbursed therefrom as follows:

               (i)     Subject to the terms hereof, the Escrow Deposit shall be
held and disbursed by Escrow Agent and used to fund to Purchaser the items set
forth on the Deposit Breakdown.

               (ii)    For purposes hereof, the term "Vacant Space" shall mean
the ___________ square feet of tenant floor area at the Property that, as of the
date of Closing, for which the Tenant Conditions as hereinafter defined are not
satisfied. For the purposes hereof, the Tenant Conditions for any Property
vacant space gross leasable area are hereby defined as (i) a signed lease, and
(ii) with Tenant either paying full rent and reimbursements or the all
conditions precedent to Rent Commencement Date (as defined in such tenant lease)
shall have occurred or been satisfied and (iii) with all the leasing commissions
and tenant improvement allowances either paid for by Seller or credited to Buyer
and (iv) with a certificate of occupancy or its equivalent occupancy permit
issued by the local governmental authorities, for such tenant's respective
demised premises. Purchaser shall receive a prorated credit from the Master
Lease Deposit on the date of Closing (as defined in the Contract) for the rent
and reimbursable expenses attributable to the Vacant Space from the date of
Closing through the end of the month in which Closing occurs in accordance with
the terms of Exhibit "A" attached hereto and made a part hereof. However as
noted on Exhibit A such total shall be reduced by Thirty Eight Thousand Dollars
and 00/100 ($38,000). Thereafter, through the date upon which all Tenant
Conditions are satisfied with respect to all or any portion of the Vacant Space,
Escrow Agent shall pay to Purchaser (and Escrow Agent is hereby authorized to
pay to Purchaser without further direction from Seller) from the Master Lease
Deposit, on the first day of each month, the amount of rent and other
reimburseable expenses and

30
<Page>

other charges (in accordance with the terms of Exhibit A) which would be due on
a monthly basis from tenants of the Vacant Space as if the Tenant Conditions
were satisfied (prorated for any partial month) (the "Master Lease Deposit
Monthly Payment"). The Master Lease Deposit Monthly Payment shall be made by
Escrow Agent to Purchaser until such time as the respective tenant(s) for the
Vacant Space, and Seller, have satisfied the Tenant Conditions. Purchaser shall
promptly notify Seller and Escrow Agent of the date any tenant satisfies its
Tenant Conditions. The Vacant Space may be subdivided and leased to more than
one tenant in Seller's commercially reasonable discretion. As all or any portion
of the Vacant Space is leased during the 12-month period following the date of
Closing, with the Tenant Conditions having then been satisfied for such Vacant
Space so leased, the balance of the Master Lease Deposit remaining to the end of
the Escrow Term (as hereinafter defined)(measured as the number of days
remaining from the date the Tenant Conditions for such leased portion of the
Vacant Space are met through the last day of the Escrow Term), attributable to
rent, reimbursable expenses, taxes, other charges and Excess Leasing Costs
(defined as those costs stated on Exhibit "A" for such expense less the actual
cost incurred for such expense) for such leased portion of the Vacant Space,
shall be released to Seller upon the joint direction of Seller and Purchaser.
The approval of a disbursement requested by either party will be deemed approved
if the non-requesting party does not object to the disbursement request within
five (5)-business days of receipt of such request. That portion of the Master
Lease Deposit attributable to tenant improvement allowances, free rent, and
broker or consultant fees and commissions (collectively, the "Leasing Costs"),
shall be released for payment (either to Seller or third parties, as the case
may be) upon presentment of the required lien waivers and related documentation
required by any governing lease or commission agreement. The balance of the
Master Lease Deposit attributable to the Leasing Costs, if any, after
satisfaction of the Tenant Conditions with respect to all or any portion of the
Vacant Space within the 12-month period following the date of Closing, shall be
released to Seller in accordance with the terms of Exhibit A. However, if the
Tenant Conditions have not been satisfied within 12-months of the date of
Closing for any portion of the Vacant Space to achieve the Lease-up Deficiency
as defined in 11(B)(d) of the Agreement of Sale on the first day of the
nineteenth month after date of Closing, all remaining sums then remaining of the
Master Lease Deposit attributable to such Leasing Costs (to the portion of
vacant space necessary to achieve the Lease-up Deficiency) shall be released to
Purchaser. Purchaser shall promptly notify Seller and Escrow Agent of the date
any tenant opens for business as provided under any lease. Any interest on the
Escrow Deposit shall be the property of Seller and in all events shall be
disbursed to Seller no later than the final disbursement made pursuant hereto.
The term of this Escrow Agreement (the "Escrow Term") shall be from the date
hereof until the first to occur of: (a) 12-months from the date of Closing; or
(b) such date as Seller leases sufficient portion of the vacant space to achieve
Lease-up of the Property equal to One Hundred (100%) percent.

               (iii)   In the event either party objects to the disbursement of
the Escrow Deposit, the Escrow Agent shall have the right, at its option, either
(a) to hold the Escrow Deposit in escrow pending resolution of such objection by
mutual agreement of the parties or by judicial resolution of same or (b) to
disburse the Escrow Deposit into the court having jurisdiction over such
objection. After any disbursement of the Escrow Deposit under the terms of this
Escrow Agreement, Escrow Agent's duties and obligations hereunder shall cease.
In the event of any dispute regarding disbursement of the Escrow Deposit, the
party ultimately receiving the Escrow Deposit after resolution of such dispute
shall be entitled to receive from the other party all the prevailing party's
costs and expenses incurred in connection with the resolution of such dispute
including, without limitation, all court costs and reasonable attorney's fees.

     3.   This Escrow Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective heirs, principals, successors and
assigns and shall be governed and construed in accordance with the laws of the
State of Arizona. No modification, amendment or waiver of the terms hereof shall
be valid or effective unless in writing and signed by all of the parties hereto.
This Escrow Agreement may be executed in multiple counterpart originals, each of
which shall be deemed to be and shall constitute an original. This Escrow
Agreement constitutes the entire agreement between the parties hereto with
respect to this Escrow, and it supersedes all prior understandings or agreements
of the parties with respect thereto.

     4.   NOTICES. All notices, requests, consents and other communications
hereunder shall be sent to each of the following parties and be in writing and
shall be personally delivered, sent by Federal Express or other overnight or
same day courier service providing a return receipt, to the following addresses:

If to Purchaser:

                      Inland Real Estate Acquisitions, Inc.
                      2901 Butterfield Road
                      Oakbrook, IL 60523
                      Attention: G. Joseph Cosenza

31
<Page>

                          with a copy to:

                      The Inland Group, Inc.
                      2901 Butterfield Road\
                      Oak Brook, IL 60523
                      Attn: Robert Baum, General Counsel
                      Facsimile: (630) 218-4900

                          with a copy to:         Mr. Charles J. Benvenuto, Esq.
                      2901 Butterfield Road, 3rd Floor
                      Oak Brook, Illinois 60523
                      Telephone: 630-571-2331
                      Facsimile: 630-571-2360

If to Seller:         8383 Wilshire Boulevard
                      Suite 950
                      Beverly Hills, CA 90211
                      Attn: Jerald Friedman
                      Phone: (323) 866-3500
                      Fax: (323) 866-3511

with a copy to:

                      3333 New Hyde Park Road
                      Suite 100
                      New Hyde Park, New York 11042
                      Attn: Barbara E. Briamonte, Esq.
                      Phone: (516) 869-7216
                      Fax: (516) 869-7199

     5.   COUNTERPARTS. This Escrow Agreement may be executed in counterparts
and shall constitute an agreement binding on all parties notwithstanding that
all parties are not signatories of the original or the same counterpart.
Furthermore, the signatures from one counterpart may be attached to another to
constitute a fully executed original. The Escrow Agreement may be executed by
facsimile.

     6.   SELLER'S FORM LEASE AND LEASING PARAMETERS. Purchaser has approved of
Seller's form tenant lease and agrees to reasonably approve of variations
negotiated in good faith by Seller with prospective tenants in the ordinary
course of business. Seller and Purchaser further agree that attached hereto as
Exhibit B, and made a part hereof, is the agreed-to Leasing Parameters
applicable to the lease-up of the Vacant Space. Purchaser shall be obligated to
accept a prospective tenant and its prospective lease so long as the terms of
this paragraph 6 and Exhibit B are adhered-to. Notwithstanding the foregoing, in
the event there is a conflict between an actual lease approved by Purchaser and
the terms of the Leasing Parameters, the actual, approved lease shall control in
regard to Seller's adherence to the Leasing Parameters.

32
<Page>

     IN WITNESS WHEREOF, each of the parties hereto has caused this Escrow
Agreement to be signed and delivered as of the day and year first above written.

                  PURCHASER:

                       INLAND SOUTHEAST, L.L.C.,
                       a Delaware limited liability company

                       By: Inland Retail Real Estate
                           Limited Partnership, an Illinois limited partnership,
                           member

                       By: Inland Retail Real Estate Trust, Inc.,
                           a Maryland corporation, general partner

                       By:
                          -----------------------------
                       Name:
                            -----------------------------
                       As Its:
                              --------------------------

33
<Page>

                       SELLER:

                       KIMCO PEORIA CROSSING, L.P.
                       an Arizona limited partnership

                       By:Kimco Peoria 476, Inc., its general partner

                       By:
                          -----------------------------
                       Name:
                            -----------------------------
                       As Its:
                              --------------------------

                  ESCROW AGENT:

                  CHICAGO TITLE INSURANCE COMPANY

                  By:
                     --------------------------------------------
                  Nancy Castro, Senior Escrow Officer

34
<Page>

                                    EXHIBIT A

Rent per square foot for Vacant Space as set forth on the Rent Roll for twelve
(12) months (Escrow Term) ...$__________ $__________per month

Reimbursable expenses (CAM, insurance)
at $_____psf of Vacant Space, for
twelve (12) months ...................$____________   $__________per month

Real Estate Taxes at $_______ psf of Vacant
Space, for twelve (12) months ........... $__________ $__________ per month

Tenant Improvements: (a) $______ psf for vacant space

Leasing Commissions at $4.00 psf - total: $________
                                            $_________

Seller Vacancy Credit          ($38,000.00)
To be a credit to Seller and a reduction in amount calculated above as total
escrow

Note: As the Tenant Conditions are met for any part of the Vacant Space, rent,
CAM and real estate tax deposits into the Escrow shall be released to Seller at
the rate of $_____________ psf of Vacant Space for the period (if any) remaining
to the end of the Escrow Term, measured as the number of days remaining from the
date the Tenant Conditions for any part of the Vacant Space are met through the
last day of the Escrow Term. In the event the Tenant Conditions are not met for
any part of the Vacant Space necessary to achieve the Lease-up Deficiency Income
Threshold within the Escrow Term, the amount of Tenant Improvements deposit and
Leasing Commissions deposit then remaining in the Escrow and attributable to
such Vacant Space, shall be released to Purchaser upon the expiration of the
Escrow Term.

35
<Page>

                                   -EXHIBIT B-
                               LEASING PARAMETERS

     1.        The proposed use shall be a use typically found in retail centers
        of this type.

     2.        The proposed use does not violate any exclusions existing in any
        other tenant's lease or covenants existing in any other documents of
        record.

     3.        The lease is for an original term of not less than 5 years, nor
        more than 10 years.

     4.        No concessions shall be provided to the tenant which would be at
        Purchaser's expense.

     5.        All leases shall be prepared substantially in accordance with the
        small shop tenant lease form approved by Purchaser (the "SST Lease")
        during the Due Diligence Period subject to commercially reasonable
        variances and prevailing market parameters.

     6.        The proposed tenant has retail and/or business and/or management
        operating experience including, but not limited to, eighteen months in
        the type of business to be operated at the leased premises. In the
        absence of three years experience, the prospective tenant must be an
        approved franchise or a recognized regional or national franchiser.

     7.        The proposed tenant and/or lease guarantor has an aggregate net
        worth of at least two years of the total aggregate annualized rent,
        including all expenses, for any tenant of the leased premises up to
        7,000 square feet

     8.        Said leases shall average comparable revenue at least 2%
        increases per year or 7.5% aggregate increase over the 5 year term over
        the primary term of the lease as current space leases.

     9.        The tenant's lease will not include rent reductions or early
        termination clauses of any kind (excluding typical casualty/condemnation
        provisions and landlord not reconstructing the demised premises, and as
        otherwise described by the SST Lease).

     10.       In addition to tenant's base rent, the leases will include
        reimbursement for taxes, insurance and common area maintenance,
        including either a 10% administrative charge for CAM or no less than a
        4% management fee for all tenancies or as otherwise described by the SST
        Lease.

     11.       Purchaser shall act in a commercially reasonable manner and in
        good faith during its review and determination of the credit worthiness
        of any tenant and/or guarantor. Also, Purchaser agrees to respond to
        Seller deliveries of tenant/guarantor credit information within 5
        business days after its receipt by Purchaser, otherwise said
        tenant/guarantor credit worthiness shall be deemed approved by
        Purchaser.

     12.       The lease renewals, if any, will not be less than the primary
        term amounts without tenant improvements, free rent, or leasing
        commissions paid for by Purchaser.

     13.       No lease shall contain representations or warranties in regard to
        the condition of any demised premises, each being delivered in its
        as-is, where-is condition, subject to the terms of the SST Lease.

     14.       Purchaser shall act in a commercially reasonable manner and in
        good faith during its review and approval of a proposed lease pursuant
        to this Master Lease. Also, Purchaser agrees to respond to Seller
        deliveries of leases for approval and/or execution within ten (10)
        business days after its receipt by Purchaser, otherwise said lease shall
        be deemed approved.

                  If Purchaser fails to execute the lease (after having had the
opportunity to review same as provided herein) in said time period then same
shall be treated as a completed lease and Seller shall be given credit for
Leasing such vacant space pursuant to the terms contained therein and Tenant
Conditions shall be satisfied.

36
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                                    EXHIBIT 9

                            SITE PLAN OF VACANT SPACE

<Page>

                                   EXHIBIT 10

                                    EXHIBIT C

                   Tenant Estoppel Certificate Form - General

     To:

     Inland Real Estate Acquisitions, Inc., and
     Inland Southeast ____________, L.L.C. (insert Inland nominee entity),
     and its lenders, successors and assigns ("Purchaser")
     2901 Butterfield Road
     Oak Brook, Illinois 60523
     Attention: Robert Brinkman

Re:  Lease Agreement dated _________________ and amended _________________
     ("Lease"), between as "Landlord", and ____________________________________,
     as "Tenant", guaranteed by ("Guarantor") for leased premises known as (the
     "Premises") of the property commonly known as (the "Property").

1.   Tenant hereby certifies that the following represents with respect to the
     Lease are accurate and complete as of the date hereof.

     a. Dates of all amendments, letter
        agreements, modifications and waivers
        related to the Lease

     b. Commencement Date

     c. Expiration Date

     d. Current Annual Base Rent

                                            ADJUSTMENT DATE       RENTAL AMOUNT

     e. Fixed or CPI Rent Increases         _______________      _______________

     f. Square Footage of Premises

     g. Security Deposit Paid to Landlord

     h. Renewal Options

                                            _______ Additional Terms for
                                            _______ years at $__________per year

     i. Termination Options                 Termination Date _______________
                                            Fees Payable ___________________

2.   Tenant further certifies to Purchaser that:

     a. the Lease is presently in full force and effect and represents the
        entire agreement between Tenant and Landlord with respect to the
        Premises;
     b. the Lease has not been assigned and the Premises have not been sublet by
        Tenant;
     c. Tenant has accepted and is occupying the Premises, all construction
        required by the Lease has been completed and any payments, credits or
        abatements required to be given by Landlord to Tenant have been given;
     d. Tenant is open for business or is operating its business at the
        Premises;
     e. no installment of rent or other charges under the Lease other than
        current monthly rent has been paid more than 30 days in advance and
        Tenant is not in arrears on any rental payment or other charges;
     f. Landlord has no obligation to segregate the security deposit or to pay
        interest thereon;
     g. Landlord is not in default under the Lease and no event has occurred
        which, with the giving of notice or passage of time, or both, could
        result in a default by Landlord;

37
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     h. Tenant has no existing defenses, offsets, liens, claims or credits
        against the payment obligations under the Lease;
     i. Tenant has not been granted any options or rights to terminate the Lease
        earlier than the Expiration Date (except as stated in paragraph 1(i));
     j. Tenant has not been granted any options or rights of first refusal to
        purchase the Premises or the Property;
     k. Tenant has not received notice of violation of any federal, state,
        county or municipal laws, regulations, ordinances, orders or directives
        relating to the use or condition of the Premises or the Property;
     l. no hazardous wastes or toxic substances, as defined by all applicable
        federal, state or local statutes, rules or regulations have been
        disposed, stored or treated on or about the Premises or the Property by
        Tenant;
     m. Tenant has not received any notice of a prior sale, transfer,
        assignment, pledge or other hypothecation of the Premises or the Lease
        or of the rents provided for therein;
     n. Tenant has not filed, and is not currently the subject of any filing,
        voluntary or involuntary, for bankruptcy or reorganization under any
        applicable bankruptcy or creditors rights laws;
     o. the Lease does not give the Tenant any operating exclusives for the
        Property; and
     p. Rent has been paid through _______________, 2003.

3.   This certification is made with the knowledge that Purchaser is about to
     acquire title to the Property and obtain financing which shall be secured
     by a deed of trust (or mortgage), security agreement and assignment of
     rents, leases and contracts upon the property. Tenant acknowledges that
     Purchaser's interest in the Lease (as landlord) will be assigned to a
     lender as security for the loan. All rent payments under the Lease shall
     continue to be paid to landlord in accordance with the terms of the Lease
     until Tenant is notified otherwise in writing by Buyer's lender or its
     successors and assigns. In the event that a lender succeeds to landlord's
     interest under the Lease, Tenant agrees to attorn to the lender at lender's
     request, so long as the lender agrees that unless Tenant is in default
     under the Lease, the Lease will remain in full force and effect. Tenant
     further acknowledges and agrees that Purchaser (including its lender),
     their respective successors and assigns shall have the right to rely on the
     information contained in this Certificate. The undersigned is authorized to
     execute this Tenant Estoppel Certificate on behalf of Tenant.

                                             [TENANT]
                                             By:
                                             Its:_______________________________
                                             Date:_______________________, 2003

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                         GUARANTOR ESTOPPEL CERTIFICATE

Date: _________________________, 2003

     To: ______________________

     Inland Real Estate Acquisitions, Inc., and
     Inland Southeast ___________, L.L.C. (insert Inland nominee entity),
     and its lenders, successors and assigns ("Purchaser")
     2901 Butterfield Road
     Oak Brook, Illinois 60523
     Attention: Robert Brinkman

    Re: Guaranty Agreement dated ______________________ ("Guaranty of Lease")
    pertaining to that certain lease dated ____________________________________
    between as Landlord and _________________________________ as Tenant for
    leased premises known as ______________________________ (the "Premises")
    located at the property commonly known as ________________________________
    (the "Property").

    1.  Guarantor certifies to Lender and Purchaser that: (a) the Guaranty of
        Lease has been properly executed by Guarantor and is presently in full
        force and effect without amendment or modification except as noted
        above; (b) Guarantor has no existing defenses, offsets, liens, claims or
        credits against the obligations under the Guaranty of Lease.

    2.  This certification is made with the knowledge that Purchaser is about to
        acquire title to the Property and a lender is about to provide Landlord
        with financing which shall be secured by a deed of trust (or mortgage),
        security agreement and assignment of rents, leases and contracts upon
        the Property. Guarantor further acknowledges and agrees that Purchaser
        and its lender and their respective successors and assigns shall have
        the right to rely on the information contained in this Certificate.

    3.  The undersigned is authorized to execute this Guarantor Estoppel
        Certificate on behalf of Guarantor.

                                             [GUARANTOR]

                                             By:

                                       40
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                                   EXHIBIT 11
                             REA ESTOPPEL STATEMENT

     The undersigned_________________, a __________ corporation ("______"), is a
party to the ____________________ (REA) recorded on ________________, _____ in
Book _____, Page ______ of the Public Records of ______ County, ______ (the
"REA"), between and among _______, a ______________ ("Developer"), and
_______________________, a ______________ (corporation) ("______"), with respect
to the _______________________ Shopping Center in ______, ______ (the "Shopping
Center"). ___________ has been advised that Developer is in process of selling
Developer's interest in the Shopping Center to INLAND (entity) having a notice
address of 2901 Butterfield Road, Oak Brook, Illinois 60523, Attention: Vice
Chairman (together with its lender, and successors and assigns, collectively
referred to herein as "Purchaser"). _____________ hereby states to Purchaser as
follows (without undertaking any investigation to verify the accuracy of the
statements made):

     1.   The REA has not been amended and is in full force and effect.

     2.   The REA is presently in full force and effect according to its terms.

     3.   __________ has neither given nor received any notice of default with
respect to the REA. To the best of _________'s knowledge (whereby knowledge
shall be limited to the party signing this REA Estoppel Agreement on behalf of
___________________), neither _____________ nor any other party is in default
under the REA.

     4.   As provided under Section __________ of the ______________________REA,
___________ acknowledges and agrees that, upon its acquisition of Developer's
interest in the Shopping Center, Purchaser shall be entitled to all of the
benefits, rights, privileges and burdens of the Developer under the REA.

     5.   The gross leasable area of the ____________ store is _____________.

     6.   ___________'s last contribution for common area maintenance costs and
expenses was for the month of _______________, 2003 in the amount of
$ _____________.

     This Statement does not (a) constitute a waiver of any rights
_______________ may have under the REA, or (b) modify, alter, or change any of
the terms or conditions of the REA.

     No officer or employee signing this Statement on behalf of ___________
shall have any liability as a result of having given this statement.

     The statements contained in this Statement are not affirmative
representations, warranties, covenants or waivers, and _______ shall not be
liable to Developer, Purchaser or any third party on account of any information
herein contained, notwithstanding the failure, for any reason, to disclose
and/or correct relevant information. Notwithstanding the preceding sentence,
_______ shall be estopped from asserting any claim or defense against Purchaser
to the extent such claim or assertion is based upon facts, now known to the
person(s) signing below on behalf of _______, which are contrary to those
contained herein, if Purchaser has acted in reasonable reliance upon such
statements without knowledge of facts to the contrary. This Statement is given
solely for Purchaser's information and may not be relied upon by anyone other
than Purchaser, or in connection with any transaction other than the transaction
described above. Capitalized terms used in this Statement, unless otherwise
defined, will have the meanings ascribed to such terms in the REA.

     Dated as of __________________, 2003.

                                             ------------------------------
                                             A _______________(CORPORATION)

                                       41
<Page>

                                             By:
                                                ----------------------------
                                             As Its:

                                   EXHIBIT 12
                         INLAND SOUTHERN MANAGEMENT LLC
                          FINAL DUE DILIGENCE CHECKLIST

A.   FINANCIAL INFORMATION

     1. Copy of leases and any guarantees

     2. Current Rent Roll

     3. Prior five full years operating statements

     4. Prior year's general ledger statement

     5. Last three years' bills for:

             a.   Real estate taxes

             b.   Insurance
                  1) Liability
                  2) Property

             c.   Reconciliation's for CAM/taxes/insurance

             Statement of current monthly amounts paid by tenants for
                  CAM/tax/insurance plus a year-to-date balance of amounts paid
                  by each tenant

     6. Base rent collected in previous five calendar year period by tenant

     7. Physical occupancy for the last five calendar years prior to purchase

     8. Receivables status/aging report

     9. Tenant sales reports for last three years

    10. Tenant financial statements

    11. Lease expirations - next three years

B.   EXPENSE INFORMATION

     1. Twelve months of consecutive utility bills

             a.   Water
             b.   Gas
             c.   Electric
             d.   Telephone & dedicated lines

     2.  Copies of all service agreements, contracts or any leases that encumber
         the property

             a.   Fire/burglar alarm
                  1) Start date__________________________
                  2) Ending date_________________________

                                       42
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                  3) Notice period_______________________
                  4) Cancelable or not___________________

             b.   Antenna cable/satellite dish
                  1) Start date__________________________
                  2) Ending date_________________________
                  3) Notice period_______________________
                  4) Cancelable or not___________________

             c.   Cleaning
                  1) Start date__________________________
                  2) Ending date_________________________
                  3) Notice period_______________________
                  4) Cancelable or not___________________

             d.   Exterminating
                  1) Start date__________________________
                  2) Ending date_________________________
                  3) Notice period_______________________
                  4) Cancelable or not___________________

             e.   Landscaping
                  1) Start date__________________________
                  2) Ending date_________________________
                  3) Notice period_______________________
                  4) Cancelable or not___________________

             f.   Scavenger
                  1) Start date__________________________
                  2) Ending date_________________________
                  3) Notice period_______________________
                  4) Cancelable or not___________________

             g.   Security service
                  1) Start date__________________________
                  2) Ending date_________________________
                  3) Notice period_______________________
                  4) Cancelable or not___________________

             h.   Snow removal
                  1) Start date__________________________
                  2) Ending date_________________________
                  3) Notice period_______________________
                  4) Cancelable or not

             i.   Towing
                  1) Start date___
                  2) Ending date________
                  3) Notice period______
                  4) Cancelable or not__

             j.   Union contracts
                  1) Start date___
                  2) Ending date________
                  3) Notice period______
                  4) Cancelable or not__

             k.   Elevator
                  1) Start date_
                  2) Ending date________
                  3) Notice period______
                  4) Cancelable or not__

             1.   Uniform rental
                  1) Start date_

                                       43
<Page>

                  2) Ending date_______
                  3) Notice period_____
                  4) Cancelable or not_

             m.   Water softeners
                  1) Start date_
                  2) Ending date_______
                  3) Notice period_____
                  4) Cancelable or not_

             n.   Leasing
                  1) Start date_
                  2) Ending dale_______
                  3) Notice period_____
                  4) Cancelable or not_

             o.   Management
                  1) Start date_
                  2) Ending date_______
                  3) Notice period_____
                  4) Cancelable or not_

             p.   Advertising
                  1) Start date_
                  2) Ending date_______
                  3) Notice period_____
                  4) Cancelable or not_

             q.   Tax reduction legal fees
                  1) Start date_
                  2) Ending date_______
                  3) Notice period_____
                  4) Cancelable or not_

             r.       Any other service contracts or leases not cancelable in 90
                      days
                  1) Start date__________________________
                  2) Ending date_________________________
                  3) Notice period_______________________
                  4) Cancelable or not___________________

     3.  Copies of all warranties which benefit the initial construction of the
         improvements upon the Property (e.g., HVAC, roof and parking lot)

C. ENVIRONMENTAL REPORTS

         1.  Phase 1

         2.  Other

D. STAFFING

         1.  Itemized by position and salary

E. SITE INSPECTIONS

         1.  Inspection report

         2.  Photo attached

F. MISCELLANEOUS

         1.  Code violations

             a. Current and outstanding
             b. Last 24 months, with compliance

                                       44
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             c. Contact municipalities as to other problems

         2.  Easement/encumbrances: restrictive easement agreements/operating
             easement agreements

             a.  Warranties
             b.  Current tenant contact list
             c.  Certificates of insurance from tenants
             d.  Certificates of Occupancy for each tenant space

                                       45
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                                   EXHIBIT 13
                            SURVEYOR'S CERTIFICATION

     I/We hereby certify to INLAND _____________________ (Inland nominee),
_____________________(Lender) and ____________________ (Name of Title Insurance
Company) that (a) this survey was prepared by me or under my supervision, (b)
the legal description of the property as set forth herein, and the location of
all improvements, encroachments, fences, casements, roadways, rights of way and
setback lines which are either visible or of record in _______________
County,_________ _______________ (according to Commitment for Title Insurance
Number _______________, dated ______________, 2001(2), issued
___________________________), are accurately reflected hereon, (c) this survey
accurately depicts the state of facts as they appear on the ground, (d) except
as shown hereon, there are no improvements, encroachments, fences or roadways on
any portion of the property reflected hereon, (e) the property shown hereon has
access to a publicly dedicated roadway, (f) the property described hereon {does}
{does not} lie in a 100 year flood plain identified by the Secretary of Housing
and Urban Development or any other governmental authority under the National
Flood Insurance Act of 1968 (24 CFR Section l909.l), as amended (such
determination having been made from a personal review of flood map number
_______, which is the latest available flood map for the property), (g) the
title lines and lines of actual possession are the same, (h) all utility
services required for the operation of the property either enter the property
through adjoining public streets, or this survey shows the point of entry and
location of any utilities which pass through or are located on adjoining private
land, (i) this survey shows the location and direction of all storm drainage
systems for the collection and disposal of all surface drainage, (j) the
property surveyed contains _________ acres and _______ parking spaces, (k) any
discharge into streams, rivers, or other conveyance systems is shown on the
survey. This survey has been made in accordance with "MINIMUM STANDARD DETAIL
REQUIREMENTS FOR ALTA/ACSM LAND TITLE SURVEYS" jointly established and adopted
by American Land Title Association ("ALTA") and American Congress on Surveying
and Mapping ("ACSM") in 1999 and meets the accuracy requirements of an Urban
Survey, as defined therein and includes items 1, 3, 4, 6, 7(a, b, and c), 8-11
and 13 of Table A thereof.

Dated:_______________, 2003      (NAME OF SURVEYOR AND QUALIFICATION)

                                        _____________________________
                                        Registration No._____________

Note: Buyer also requires a finished floor elevation certificate for all
      finished structures located in a flood zone

                                       46
<Page>

                                   EXHIBIT 14
                                  TENANT LETTER
                              (Landlord Letterhead)

                   (Landlord or management company Letterhead)

_______ ____, 2003

Insert Tenant Name
Insert Tenant Address

     Re:     The lease dated ___________________________ (collectively, with any
             and all amendments thereto, the "Lease") between __________________
             as tenant ("Tenant") and _____________________, ________________ as
             landlord ("Landlord") for property located at the _________________
             Shopping Center, _________, ______(the "Property")

Dear Tenant:

     Please be advised that the Property, subject to the above-referenced Lease,
has been sold as of _______ ____, 2003 to Inland Southeast _________________,
L.L.C. Inland Southeast _________________, L.L.C. has hired Inland Mid-Atlantic
Management Corp. as its managing agent for the Property. Effective immediately,
all rent payments pursuant to the Lease should be made payable to Inland
Mid-Atlantic Management Corp. and sent to the following address:

     Inland Mid-Atlantic Management Corp.
     P. O. Box 403089
     Atlanta, GA 30384-3089

     In addition, all notices and other communications provided by Tenant under
the Lease should be sent to Inland Southeast ___________, L.L.C. at the
following address:

     Inland Mid-Atlantic Management Corp.
     c/o Inland Southeast __________________, L.L.C.
     Attn: Ms. Laura Sabatino
     200 East Woodlawn Road
     Charlotte, NC 28217
     Telephone: 704-527-4555

     In addition, please contact your insurance agent to have a certificate
forwarded, naming as additional insured: (i) Inland Mid-Atlantic Management
Corp., and (ii) Inland Southeast ___________________, L.L.C. Thank you for your
time and attention to this matter.

                                        Very truly yours,

                                        (Landlord or management company)

                                        By:
                                            ----------------------------------

cc:  Inland Southeast ________________, L.L.C.

                                       47
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                              INTENTIONALLY DELETED

                                       48

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