Document:

EXHIBIT 10.18

 

TERM NOTE

 

November 6, 2012

 

Term Credit Amount:  $3,340,460.00

 

Maturity Date:     August 6, 2013 (the “Maturity Date”)

 

1.              Promise to Pay.  FOR VALUE RECEIVED, on the Maturity Date, IREIT DG SPE Member, L.L.C., a Delaware limited liability company (“the undersigned” or “Borrower”) promises to pay to the order of V-IN DOLLAR, LLC, an Illinois limited liability company, or its assigns (“Lender”), the sum of Three Million Three Hundred Forty Thousand Four Hundred Sixty and 00/100 Dollars ($3,340,460.00) at the office of the Lender, or at such location as any legal holder hereof shall designate, as follows:

 

(A)          commencing on December 10, 2012, and continuing on the 10th day of each month thereafter, the undersigned shall make consecutive monthly payments of interest only in arrears accrued to the date of such payment; and

 

(B)          on the Maturity Date, a payment shall be paid in the amount of the then remaining principal balance of this Note, plus interest accrued to the date of such payment.

 

2.              Interest Rate.  The unpaid principal amount from time to time outstanding on this Note shall bear interest at the rate of 10% per annum (the “Interest Rate”); provided, however, that upon the occurrence and continuance of an Event of Default, this Note shall bear interest at a rate 4% in excess of the aforesaid Interest Rate.  Interest shall accrue when payments received are not collected funds and until such funds are collected.

 

3.              Waivers. The undersigned and any endorsers and accommodation parties hereto hereby waive presentment, demand, notice of dishonor and protest.

 

4.              Prepayment.  The undersigned may from time to time, upon two (2) business days’ prior written notice received by Lender, prepay this Note in whole or in any part; provided, however, that any prepayment shall be applied to the unpaid delinquent installments thereof in the inverse order of maturity and then to principal.

 

5.              Security.  This Note is unsecured.

 

6.              Guaranty.  This Note is fully and unconditionally guarantied by Inland Real Estate Investment Corporation, a Delaware corporation (“Guarantor”) pursuant to that certain Guaranty of even date herewith given by Guarantor to Lender (as may be amended from time to time, the “Guaranty”).

 

7.              Events of Default. Each of the following acts, occurrences or omissions shall constitute an event of default under this Note (herein referred to as an “Event of Default”), whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment or order of any court or any order, rule or regulation of any governmental or nongovernmental body or tribunal:

 

 

(A)       Borrower shall default in the payment when due of any amount due and owing to the Lender under this Note or in the payment of any other amount owing by the undersigned to the Lender pursuant to any other agreement, note, instrument or guarantee; or

 

(B)       Borrower shall default in the performance or observance of any term, covenant, condition or agreement on its part to be performed or observed under this Note (not constituting an Event of Default under any other clause of this Section 7 of this Note) and such default shall continue unremedied for 10 days after written notice thereof shall have been given by the Lender to the undersigned; or

 

(C)       Any representation or warranty made by the undersigned contained in this Note or any agreement, document or instrument referenced in or contemplated by this Note (collectively, the “Documents”) shall at any time prove to have been incorrect in any material respect when made; or

 

(D)       Either: (i) Borrower or Guarantor shall become insolvent or generally fail to pay, or admit in writing his inability to pay in an insolvency proceeding, such Person’s debts as they become due, or a proceeding under any bankruptcy, reorganization, arrangement of debt, insolvency, readjustment of debt or receivership law or statute is filed by or against Borrower or Guarantor or Borrower or Guarantor makes an assignment for the benefit of creditors; provided, however, that no Event of Default shall exist pursuant to this Subsection D, Clause (i) due to an involuntary bankruptcy case, proceeding or petition filed against Borrower or Guarantor unless such involuntary case, proceeding or petition shall not have been dismissed or withdrawn within 90 days after the date of such involuntary filing; or (ii) corporate or other action shall be taken by Borrower or Guarantor for the purpose of effectuating any of the foregoing; or

 

(E)        Borrower or Guarantor shall be dissolved, whether voluntarily or involuntarily and such Person has not taken all actions required to become reinstated; or

 

(F)         Subject to any applicable cure and/or notice periods, any material default shall occur under any material agreement, document or instrument binding upon Borrower, or any assets of the Borrower, including, but not limited to, any default in the payment when due of any principal of or interest on any indebtedness for money borrowed or guaranteed by the Borrower, or any default in the payment when due, or in the performance or observance of, any material obligation of, or condition agreed to by, the Borrower with respect to any purchase or lease of any real or personal property or services; or

 

(G)       Any default or event of default (however such terms are defined) shall occur under any mortgage loan documents, whether now existing or hereafter arising, between IREIT East Brenton DG, L.L.C., IREIT Robertsdale DG, L.L.C. IREIT Wetumpka DG, L.L.C., IREIT Madisonville DG, L.L.C., and/or IREIT Newport DG, L.L.C., each a Delaware limited liability company, as borrower, and its respective mortgage lender.

 

8.              Governing Law; Interpretation; Fees. This Note has been executed and delivered at Chicago, Illinois, and shall be governed by the laws of the State of Illinois.  This Note is not effective until it has been accepted by Lender in Chicago, Illinois.  Whenever possible, each provision of this Note shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Note shall be prohibited by or invalid under applicable 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 Note, or any provision of any agreement between the undersigned and Lender.  The undersigned agrees to pay (A) all out-of-pocket fees and expenses of Lender

 

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(including, but not limited to, fees and expenses of outside counsel to Lender and paralegals) in connection with the making and administration of the loan evidenced by this Note;  and (B) following the occurrence of an Event of Default, all reasonable fees and out-of-pocket expenses of Lender (including, but not limited to, outside counsel to Lender) in connection with the enforcement of this Note and the Documents.

 

9.              Notice.  All notices, demands, instructions and other communications required or permitted to be given to or made upon any party hereto shall be in writing personally delivered or sent by overnight courier or by facsimile machine, and shall be deemed to be given for purposes of this Note on the day that such writing is personally delivered or sent by facsimile machine or one (1) business day after such notice is sent by overnight courier to the intended recipient thereof in accordance with the provisions of this Section.  Unless otherwise specified in a notice sent or delivered in accordance with the foregoing provisions of this Section, notices, demands, instructions and other communications in writing shall be given to or made upon the respective parties hereto at their respective addresses indicated for such party below:

 

	
If   to the Borrower:
    	
IREIT   DG SPE Member, L.L.C.
    
	
 
    	
2901   Butterfield Road
    
	
 
    	
Oakbrook, Illinois   60523
    
	
 
    	
Attn:   JoAnn McGuinness
    
	
 
    	
Phone:   (630) 218-8000
    
	
 
    	
Fax   No.: (630) 218-4900
    
	
 
    	
 
    
	
With   a copy to:
    	
The   Inland Real Estate Group, Inc.
    
	
 
    	
2901   Butterfield Road
    
	
 
    	
Oakbrook, Illinois   60523
    
	
 
    	
Attn:   General Counsel
    
	
 
    	
Phone:   (630) 218-8000
    
	
 
    	
Fax   No.: (630) 218-4900
    
	
 
    	
 
    
	
If   to the Lender:
    	
V-In   Dollar, LLC
    
	
 
    	
c/o   Sherwin Real Estate, Inc.
    
	
 
    	
1560   Sherman Avenue, Suite 203
    
	
 
    	
Evanston, Illinois   60201
    
	
 
    	
Attention:   Lawrence J. Starkman
    
	
 
    	
Phone:   (847) 864-9200
    
	
 
    	
Fax   No. (847) 864-0757
    
	
 
    	
 
    
	
With   a copy to:
    	
Scott   H. Reynolds, Esq.
    
	
 
    	
Levenfeld   Pearlstein, LLC
    
	
 
    	
2   North LaSalle Street
    
	
 
    	
Suite 1300
    
	
 
    	
Chicago, Illinois   60602
    
	
 
    	
Phone:   (312) 346-8380
    
	
 
    	
Fax   No. (312) 346-8434
    

 

 

10.       Jurisdiction and Venue; Waiver of Jury Trial. THE UNDERSIGNED ACKNOWLEDGES THAT THIS NOTE IS BEING ACCEPTED BY THE LENDER IN PARTIAL CONSIDERATION OF LENDER’S RIGHT TO ENFORCE IN THE JURISDICTION STATED BELOW THE TERMS AND PROVISION OF THIS NOTE AND THE DOCUMENTS. THE UNDERSIGNED CONSENTS TO JURISDICTION IN THE STATE OF ILLINOIS AND VENUE IN ANY

 

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FEDERAL OR STATE COURT IN THE COUNTY OF COOK FOR SUCH PURPOSES AND WAIVES ANY AND ALL RIGHTS TO CONTEST SAID JURISDICTION AND VENUE AND ANY OBJECTION THAT SAID COUNTY ARE NOT CONVENIENT.  THE UNDERSIGNED WAIVES ANY RIGHTS TO COMMENCE ANY ACTION AGAINST LENDER IN ANY JURISDICTION EXCEPT THE AFORESAID COUNTY AND STATE.  LENDER (BY ITS ACCEPTANCE) AND THE UNDERSIGNED HEREBY EACH EXPRESSLY WAIVE ANY AND ALL RIGHTS TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY WITH RESPECT TO ANY MATTER WHATSOEVER RELATING TO, ARISING OUT OF OR IN ANY WAY CONNECTED WITH THE LOAN, THE DOCUMENTS AND/OR THE TRANSACTION WHICH IS THE SUBJECT OF THIS NOTE.

 

{Signature Page Follows]

 

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[Signature Page to Term Note]

 

	
 
    	
IREIT   DG SPE MEMBER, L.L.C., a
    
	
 
    	
Delaware   limited liability company
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
INLAND   REAL ESTATE INCOME TRUST, INC., its sole member
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Catherine L. Lynch
    
	
 
    	
 
    	
Name:
    	
 Catherine L. Lynch
    
	
 
    	
 
    	
Title:   
    	
CFO
    
						

 

5EXHIBIT 10.19

 

GUARANTY AGREEMENT

 

THIS GUARANTY AGREEMENT (this “Guaranty”) is executed as of November 6, 2012, by INLAND REAL ESTATE INVESTMENT CORPORATION, a Delaware corporation (“IREIC”), and INLAND REAL ESTATE INCOME TRUST, INC., a Maryland corporation (“IREIT”), each having an address at 2901 Butterfield Road, Oak Brook, Illinois 60523 (individually and collectively, as the context may require, “Guarantor”), for the benefit of JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a banking association chartered under the laws of the United States of America, having an address at 383 Madison Avenue, New York, New York 10179 (“Lender”).

 

W I T N E S S E T H:

 

WHEREAS, pursuant to that certain Promissory Note, dated of even date herewith, executed by the entities set forth on Schedule A attached hereto (each an “Individual Borrower” and collectively, “Borrower”), and payable to the order of Lender in the original principal amount of THREE MILLION THREE HUNDRED FORTY THOUSAND FOUR HUNDRED FIFTY AND NO/100 DOLLARS ($3,340,450.00) (as the same may hereafter be amended, restated, renewed, supplemented, replaced, extended or otherwise modified from time to time, the “Note”), Borrower has become indebted, and may from time to time be further indebted, to Lender with respect to a loan (“Loan”) made pursuant to that certain Loan Agreement, of even date herewith, between Borrower and Lender (as the same may hereinafter be amended, modified, restated, renewed or replaced, the “Loan Agreement”);

 

WHEREAS, the Loan is secured by, among other things, the lien and security interest of those certain mortgages and/or deeds of trust, each dated as of the date hereof, given by Borrower to or for the benefit of Lender and encumbering the Property (such mortgages and deeds of trust, as the same may hereafter be amended, restated, renewed, supplemented, replaced, extended or otherwise modified from time to time, each, a “Mortgage” and collectively, the “Mortgages”), and is further evidenced, secured or governed by such other instruments and documents executed in connection with the Loan (together with the Note, the Loan Agreement and the Mortgages are hereinafter collectively referred to as the “Loan Documents”);

 

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

 

WHEREAS, IREIC is an affiliate of Borrower, and IREIC will benefit from Lender’s making the Loan to Borrower; and

 

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

 

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

 

 

ARTICLE 1
 NATURE AND SCOPE OF GUARANTY

 

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

 

1.2                               Definition of Guaranteed Obligations. As used herein, the term “Guaranteed Obligations” means all obligations and liabilities of Borrower pursuant to Section 9.3 of the Loan Agreement.

 

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

 

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

 

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

 

1.6                               No Duty To Pursue Others.  It shall not be necessary for Lender (and Guarantor hereby waives any rights which Guarantor may have to require Lender), in order to enforce the obligations of Guarantor hereunder, first to (i) institute suit or exhaust its remedies against Borrower or others liable on the Loan or the Guaranteed Obligations or any other person, (ii)

 

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enforce Lender’s rights against any collateral which shall ever have been given to secure the Loan, (iii) enforce Lender’s rights against any other guarantors of the Guaranteed Obligations, (iv) join Borrower or any others liable on the Guaranteed Obligations in any action seeking to enforce this Guaranty, (v) exhaust any remedies available to Lender against any collateral which shall ever have been given to secure the Loan, or (vi) resort to any other means of obtaining payment of the Guaranteed Obligations. To the extent permitted by applicable law, Lender shall not be required to mitigate damages or take any other action to reduce, collect or enforce the Guaranteed Obligations.

 

1.7                               Waivers.  Guarantor agrees to the provisions of the Loan Documents, and to the extent permitted by applicable law, hereby waives notice of (i) any loans or advances made by Lender to Borrower, (ii) acceptance of this Guaranty, (iii) any amendment or extension of the Note, the Mortgages, the Loan Agreement or of any other Loan Documents, (iv) the execution and delivery by Borrower and Lender of any other loan or credit agreement or of Borrower’s execution and delivery of any promissory notes or other documents arising under the Loan Documents or in connection with any Individual Property, (v) the occurrence of any breach by Borrower or an Event of Default, (vi) Lender’s transfer or disposition of the Guaranteed Obligations, or any part thereof, (vii) sale or foreclosure (or posting or advertising for sale or foreclosure) of any collateral for the Guaranteed Obligations, (viii) protest, proof of non-payment or default by Borrower, or (ix) any other action at any time taken or omitted by Lender, and, generally, all demands and notices of every kind in connection with this Guaranty, the Loan Documents, any documents or agreements evidencing, securing or relating to any of the Guaranteed Obligations and the obligations hereby guaranteed.

 

1.8                               Payment of Expenses.  In the event that Guarantor should breach or fail to timely perform any provisions of this Guaranty, Guarantor shall, immediately upon demand by Lender, pay Lender all costs and expenses (including court costs and attorneys’ fees) incurred by Lender in the enforcement hereof or the preservation of Lender’s rights hereunder.  The covenant contained in this Section shall survive the payment and performance of the Guaranteed Obligations.

 

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

 

1.10                        Waiver of Subrogation, Reimbursement and Contribution.  Notwithstanding anything to the contrary contained in this Guaranty, Guarantor hereby unconditionally and irrevocably waives, releases and abrogates any and all rights it may now or hereafter have under any agreement, at law or in equity (including, without limitation, any law subrogating the Guarantor to the rights of Lender), to assert any claim against or seek contribution, indemnification or any other form of reimbursement from Borrower or any other party liable for

 

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payment of any or all of the Guaranteed Obligations for any payment made by Guarantor under or in connection with this Guaranty or otherwise.

 

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

 

ARTICLE 2
 EVENTS AND CIRCUMSTANCES NOT REDUCING OR 
 DISCHARGING GUARANTOR’S OBLIGATIONS

 

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

 

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

 

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

 

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

 

2.4                               Invalidity of Guaranteed Obligations.  The invalidity, illegality or unenforceability of all or any part of the Guaranteed Obligations, or any document or agreement executed in connection with the Guaranteed Obligations, for any reason whatsoever, including without limitation the fact that (i) the Guaranteed Obligations, or any part thereof, exceeds the amount permitted by law, (ii) the act of creating the Guaranteed Obligations or any part thereof is ultra vires, (iii) the officers or representatives executing the Note, the Mortgages, the Loan Agreement or the other Loan Documents or otherwise creating the Guaranteed Obligations acted in excess of their authority, (iv) the Guaranteed Obligations violate applicable usury laws, (v) Borrower has valid defenses, claims or offsets (whether at law, in equity or by agreement) which render the Guaranteed Obligations wholly or partially uncollectible from Borrower, (vi) the creation, performance or repayment of the Guaranteed Obligations (or the execution, delivery and performance of any document or instrument representing part of the Guaranteed Obligations

 

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or executed in connection with the Guaranteed Obligations, or given to secure the repayment of the Guaranteed Obligations) is illegal, uncollectible or unenforceable, or (vii) the Note, the Mortgages, the Loan Agreement or any of the other Loan Documents have been forged or otherwise are irregular or not genuine or authentic, it being agreed that Guarantor shall, to the extent permitted by applicable law, remain liable hereon regardless of whether Borrower or any other person be found not liable on the Guaranteed Obligations or any part thereof for any reason.

 

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

 

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

 

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

 

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

 

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

 

2.10                        Offset.  The Note, the Loan Agreement, the Guaranteed Obligations and the liabilities and obligations of the Guarantor to Lender hereunder shall not be reduced, discharged

 

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or released because of or by reason of any existing or future right of offset, claim or defense of Borrower against Lender, or any other party, or against payment of the Guaranteed Obligations, whether such right of offset, claim or defense arises in connection with the Guaranteed Obligations (or the transactions creating the Guaranteed Obligations) or otherwise.

 

2.11                        Merger.  The reorganization, merger or consolidation of Borrower into or with any other Person.

 

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

 

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

 

ARTICLE 3
 REPRESENTATIONS AND WARRANTIES

 

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

 

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

 

3.2                               Familiarity and Reliance.  Guarantor is familiar with, and has independently reviewed books and records regarding, the financial condition of Borrower and is familiar with the value of any and all collateral intended to be created as security for the payment of the Note or Guaranteed Obligations; however, Guarantor is not relying on such financial condition or the collateral as an inducement to enter into this Guaranty.

 

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

 

3.4                               Guarantor’s Financial Condition.  As of the date hereof, and after giving effect to this Guaranty and the contingent obligation evidenced hereby, Guarantor is solvent, and has assets which, fairly valued, exceed its obligations, liabilities (including contingent liabilities) and debts, and has property and assets sufficient to satisfy and repay its obligations and liabilities.

 

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

 

3.6                               Litigation.  There are no actions, suits or proceedings at law or in equity by or before any Governmental Authority or other agency now pending or, to Guarantor’s knowledge, threatened against or affecting Guarantor which actions, suits or proceedings may (a) result in any material adverse change in the business, operations, condition (financial or otherwise), properties or assets of Guarantor, (b) result in any material impairment of the rights or ability of Guarantor to carry on its business substantially as now conducted, (c) result in any material liability on the part of Guarantor, (d) draw into question the validity of this Agreement or of any action taken or to be taken in connection with the obligations of Guarantor contemplated herein, and/or (e) materially impact the ability of Guarantor to perform under the terms of this Guaranty.

 

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

 

ARTICLE 4
 SUBORDINATION OF CERTAIN INDEBTEDNESS

 

4.1                               Subordination of All Guarantor Claims.  As used herein, the term “Guarantor Claims” shall mean all debts and liabilities of Borrower to Guarantor, whether such debts and liabilities now exist or are hereafter incurred or arise, or whether the obligations of Borrower thereon be direct, contingent, primary, secondary, several, joint and several, or otherwise, and irrespective of whether such debts or liabilities be evidenced by note, contract, open account, or otherwise, and irrespective of the person or persons in whose favor such debts or liabilities may, at their inception, have been, or may hereafter be created, or the manner in which they have been or may hereafter be acquired by Guarantor.  The Guarantor Claims shall include without limitation all rights and claims of Guarantor against Borrower (arising as a result of subrogation or otherwise) as a result of Guarantor’s payment of all or a portion of the Guaranteed Obligations.  Upon the occurrence of an Event of Default or the occurrence of an event which would, with the giving of notice or the passage of time, or both, constitute an Event of Default, Guarantor shall not receive or collect, directly or indirectly, from Borrower or any other party any amount upon the Guarantor Claims.

 

4.2                               Claims in Bankruptcy.  In the event of receivership, bankruptcy, reorganization, arrangement, debtor’s relief, or other insolvency proceedings involving Guarantor as debtor, Lender shall have the right to prove its claim in any such proceeding so as to establish its rights hereunder and receive directly from the receiver, trustee or other court custodian dividends and payments which would otherwise be payable upon Guarantor Claims.  Guarantor hereby assigns such dividends and payments to Lender.  Should Lender receive, for application against the

 

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Guaranteed Obligations, any such dividend or payment which is otherwise payable to Guarantor, and which, as between Borrower and Guarantor, shall constitute a credit against the Guarantor Claims, then upon payment to Lender in full of the Guaranteed Obligations, Guarantor shall become subrogated to the rights of Lender to the extent that such payments to Lender on the Guarantor Claims have contributed toward the liquidation of the Guaranteed Obligations, and such subrogation shall be with respect to that proportion of the Guaranteed Obligations which would have been unpaid if Lender had not received dividends or payments upon the Guarantor Claims.

 

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

 

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

 

ARTICLE 5
 MISCELLANEOUS

 

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

 

5.2                               Notices. Any notice, demand, statement, request or consent made hereunder shall be in writing and shall be deemed to be received by the addressee on (a) the third day following the day such notice is deposited with the United States Postal Service first class certified mail, return receipt requested (b) expedited, prepaid delivery service, either commercial or United

 

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States Postal Service, with proof of attempted delivery and by telecopier (with answer back acknowledged), addressed to the address, as set forth below, of the party to whom such notice is to be given, or to such other address as either party shall in like manner designate in writing.  The addresses of the parties hereto are as follows:

 

	
Guarantor:
    	
Inland   Real Estate Investment Corporation
    
	
 
    	
2901   Butterfield Road
    
	
 
    	
Oak   Brook, Illinois 60523
    
	
 
    	
Attention:   Catherine Lynch
    
	
 
    	
Facsimile   No.: (630) 645-2082
    
	
 
    	
 
    
	
 
    	
Inland   Real Estate Income Trust, Inc.
    
	
 
    	
2901   Butterfield Road
    
	
 
    	
Oak   Brook, Illinois 60523
    
	
 
    	
Attention:   JoAnne McGuinness
    
	
 
    	
Facsimile   No.: (630) 368-2218
    
	
 
    	
 
    
	
with   a copy to:
    	
The   Inland Real Estate Group, Inc./Law Department
    
	
 
    	
2901   Butterfield Road
    
	
 
    	
Oak   Brook, Illinois 60523
    
	
 
    	
Attention:   General Counsel
    
	
 
    	
Facsimile   No.: (630) 218-4900
    
	
 
    	
 
    
	
Lender:
    	
JPMorgan   Chase Bank National Association
    
	
 
    	
383   Madison Avenue
    
	
 
    	
New   York, New York 10179
    
	
 
    	
Attention:   Joseph E. Geoghan
    
	
 
    	
Facsimile   No.: (212) 834-6029
    
	
 
    	
 
    
	
with   a copy to:
    	
JPMorgan   Chase Bank, National Association
    
	
 
    	
Four   New York Plaza, 20th Floor
    
	
 
    	
New   York, NY 10004
    
	
 
    	
Attention:   Nancy Alto
    
	
 
    	
Facsimile   No.: (212) 623-4779
    
	
 
    	
 
    
	
with   an additional copy to:
    	
 
    
	
 
    	
 
    
	
 
    	
Katten   Muchin Rosenman LLP
    
	
 
    	
550   South Tryon Street, Suite 2900
    
	
 
    	
Charlotte,   North Carolina 28202
    
	
 
    	
Attention:   Daniel S. Huffenus, Esq.
    
	
 
    	
Facsimile   No.: (704) 344-3056
    

 

5.3                               Governing Law.  THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.  ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR GUARANTOR

 

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ARISING OUT OF OR RELATING TO THIS GUARANTY MAY AT LENDER’S OPTION BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE CITY OF NEW YORK, COUNTY OF NEW YORK, PURSUANT TO SECTION 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND GUARANTOR WAIVES ANY OBJECTIONS WHICH IT MAY NOW OR HEREAFTER HAVE BASED ON VENUE AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND GUARANTOR AND HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING.  GUARANTOR DOES HEREBY DESIGNATE AND APPOINT:

 

The Corporation Trust Company

Corporation Trust Center

1209 Orange Street

Wilmington, Delaware 19801

 

AS ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND AGREES THAT SERVICE OF PROCESS UPON SAID AGENT AT SAID ADDRESS AND WRITTEN NOTICE OF SAID SERVICE MAILED OR DELIVERED TO GUARANTOR IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON GUARANTOR IN ANY SUCH SUIT, ACTION OR PROCEEDING IN THE STATE OF NEW YORK.

 

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

 

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

 

5.6                               Parties Bound; Assignment; Joint and Several.  This Guaranty shall be binding upon and inure to the benefit of the parties hereto and their respective successors, assigns and legal representatives; provided, however, that Guarantor may not, without the prior written consent of Lender, assign any of its rights, powers, duties or obligations hereunder.  If Guarantor consists of more than one person or party, the obligations and liabilities of each such person or party shall be joint and several.

 

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

 

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

 

5.9                               Counterparts.  To facilitate execution, this Guaranty may be executed in as many counterparts as may be convenient or required.  It shall not be necessary that the signature of, or on behalf of, each party, or that the signature of all persons required to bind any party, appear on each counterpart.  All counterparts shall collectively constitute a single instrument.  It shall not be necessary in making proof of this Guaranty to produce or account for more than a single counterpart containing the respective signatures of, or on behalf of, each of the parties hereto. Any signature page to any counterpart may be detached from such counterpart without impairing the legal effect of the signatures thereon and thereafter attached to another counterpart identical thereto except having attached to it additional signature pages.

 

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

 

5.11                        Other Defined Terms.  Any capitalized term utilized herein shall have the meaning as specified in the Loan Agreement, unless such term is otherwise specifically defined herein.

 

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

 

5.13                        Waiver of Right To Trial By Jury.  GUARANTOR HEREBY AGREES NOT TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVES ANY RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH REGARD TO THIS GUARANTY, THE NOTE, THE LOAN AGREEMENT, THE MORTGAGES, OR THE

 

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OTHER LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING IN CONNECTION THEREWITH.  THIS WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY AND VOLUNTARILY BY GUARANTOR, AND IS INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE.  LENDER IS HEREBY AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER BY GUARANTOR.

 

5.14                        Cooperation.  Guarantor acknowledges that Lender and its successors and assigns may (i) sell this Guaranty, the Note and other Loan Documents to one or more investors as a whole loan, (ii) participate the Loan secured by this Guaranty to one or more investors, (iii) deposit this Guaranty, the Note and other Loan Documents with a trust, which trust may sell certificates to investors evidencing an ownership interest in the trust assets, or (iv) otherwise sell the Loan or interest therein to investors (the transactions referred to in clauses (i) through (iv) are hereinafter each referred to as “Secondary Market Transaction”).  Guarantor shall cooperate with Lender in effecting any such Secondary Market Transaction and shall cooperate to implement all customary and reasonable requirements imposed by any Rating Agency or potential investor involved in any Secondary Market Transaction.  Guarantor shall provide such information and documents relating to Guarantor as Lender may reasonably request in connection with such Secondary Market Transaction.  In addition, Guarantor shall make available to Lender all information concerning its business and operations that Lender may reasonably request.  Lender shall be permitted to share all such information with the investment banking firms (or other potential investors), Rating Agencies, accounting firms, law firms and other third-party advisory firms involved with the Loan and the Loan Documents or the applicable Secondary Market Transaction.  It is understood that the information provided by Guarantor to Lender may ultimately be incorporated into the offering documents for the Secondary Market Transaction and thus various investors may also see some or all of the information.  Lender and all of the aforesaid third-party advisors and professional firms shall be entitled to rely on the information supplied by, or on behalf of, Guarantor in the form as provided by Guarantor.  Lender may publicize the existence of the Loan in connection with its marketing for a Secondary Market Transaction or otherwise as part of its business development.  All reasonable third party costs and expenses incurred by Guarantor in connection with Guarantor complying with requests made under this Section 5.14 shall be paid by Guarantor; provided, however, so long as no Event of Default has occurred and is continuing, all such reasonable third party costs and expenses incurred by Guarantor in connection with Guarantor’s complying with requests made under this Section 5.14 shall be paid by Lender.

 

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

 

5.16                        Release of IREIC.  Provided that no Event of Default shall then exist, IREIC shall be deemed released as guarantor hereunder, as indemnitor under the Environmental

 

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Indemnity and as Joinder Party under the Joinder Agreement upon IREIT delivering to Lender copies of the Form 10-K and/or Form 10-Q filings of IREIT, which show to Lender’s reasonable satisfaction that IREIT has maintained a Net Worth of not less than $25,000,000.00 during the two (2) consecutive calendar quarters immediately preceding such release (the “IREIC Release Event”).  Upon the occurrence of the IREIC Release Event, IREIC shall be deemed released automatically from all liability under this Guaranty, the Environmental Indemnity and the Joinder Agreement and all references to “Guarantor” in this Guaranty and the other Loan Documents shall be solely a reference to IREIT, and IREIC shall have no further obligations hereunder or under the other Loan Documents.  As used in this Section 5.16, “GAAP” shall mean generally accepted accounting principles, consistently applied, and “Net Worth” shall mean, as of a given date, (i) IREIT’s total assets as of such date less (ii) IREIT’s total liabilities as of such date, determined in accordance with GAAP.

 

[NO FURTHER TEXT ON THIS PAGE]

 

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EXECUTED as of the day and year first above written.

 

	
 
    	
GUARANTOR:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
INLAND   REAL ESTATE INVESTMENT CORPORATION, a Delaware corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Catherine L. Lynch
    
	
 
    	
 
    	
Name:   Catherine L. Lynch
    
	
 
    	
 
    	
Title:   CFO
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
INLAND   REAL ESTATE INCOME TRUST, INC., a Maryland corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   David Z. Lichterman
    
	
 
    	
 
    	
Name:   David Z. Lichterman
    
	
 
    	
 
    	
Title:   Chief Accounting Officer
    
				

 

 

SCHEDULE A

 

BORROWER

 

1.                                      IREIT East Brewton DG, L.L.C., a Delaware limited liability company

2.                                      IREIT Robertsdale DG, L.L.C., a Delaware limited liability company

3.                                      IREIT Wetumpka DG, L.L.C., a Delaware limited liability company

4.                                      IREIT Madisonville DG, L.L.C., a Delaware limited liability company

5.                                      IREIT Newport DG, L.L.C., a Delaware limited liability company

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