Inland Real Estate Group

The Company may acquire Real Estate Assets from the Sponsor, Business Manager, Real Estate Managers, Directors or Affiliates, subject to majority Independent Director approval and fair-value / appraisal requirements. No arm's-length negotiation is mandated — the charter permits above-cost purchases if 'substantial justification' exists and Independent Directors find it reasonable.

“The Company shall not purchase Real Estate Assets from the Sponsor, the Business Manager, any Real Estate Manager, a Director or any Affiliate thereof, unless a majority of Directors (including a majority of Independent Directors) not otherwise interested in the transaction approves the transaction as being fair and reasonable to the Company and the price for the Real Estate Assets is no greater than the cost paid by the Sponsor, the Business Manager, the Real Estate Manager, a Director or any Affiliate for the Real Estate Assets, unless substantial justification for the excess exists and the excess is, in the opinion of the Board (including a majority of the Independent Directors), reasonable”

The mutual non-compete specifically excludes entities sponsored by Inland Private Capital Corporation and assets managed for investors sourced outside the Channels, meaning Inland affiliates may continue to compete with the Company in meaningful segments of the CRE debt market.

“this provision does not restrict the Advisor or the Sub-Advisor or any of their respective Affiliates (i) with respect to any entity having an investment strategy not primarily focused on investment in Primary Target Investments, irrespective of whether such entity was capitalized or is intended to be capitalized substantially with capital sourced, directly or indirectly, from individual investors through the Channels, including but not limited to entities sponsored by Inland Private Capital Corporation”

The Amended Agreement explicitly acknowledges that both the Advisor and Sub-Advisor and their affiliates engage in businesses competitive with the Company and may advise other persons, including other REITs, creating potential conflicts of interest in investment allocation.

“nothing herein contained shall prevent the Advisor or Sub-Advisor from engaging in or earning fees from other activities, including, without limitation, the rendering of advice to other Persons (including other REITs) and the management of other programs advised, sponsored or organized by the Advisor or the Sub-Advisor, respectively, or any of their Affiliates.”

The Company may borrow from the Sponsor, Business Manager, Real Estate Managers, Directors or Affiliates if a majority of Independent Directors approves the terms as fair, competitive and no less favorable than an unaffiliated loan. This creates a structural conflict where affiliated lenders can provide financing to the Company.

“The Company may not borrow money from the Sponsor, the Business Manager, any Real Estate Manager, a Director or any Affiliate thereof or from a wholly-owned subsidiary of the Company, unless a majority of Directors (including a majority of Independent Directors) not otherwise interested in the transaction approves the loan as being fair, competitive and commercially reasonable and no less favorable to the Company than a loan from an unaffiliated party under the same circumstances”

The charter permits the Company to purchase Real Estate Assets from, sell assets to, borrow from, and invest in joint ventures with the Sponsor, Business Manager, Real Estate Manager, Directors, and their Affiliates, subject to majority Independent Director approval and fairness determinations. This creates ongoing related-party transaction risk.

“The Company shall not purchase Real Estate Assets from the Sponsor, the Business Manager, any Real Estate Manager, a Director or any Affiliate thereof, unless a majority of Directors (including a majority of Independent Directors) not otherwise interested in the transaction approve the transaction as being fair and reasonable to the Company and the price for the Real Estate Assets is no greater than the cost paid by the Sponsor, the Business Manager, the Real Estate Manager, a Director or any Affiliate for the Real Estate Assets, unless substantial justification for the excess exists and the excess is, in the opinion of the Board (including a majority of the Independent Directors), reasonable.”

The Business Manager and its Affiliates (including the Sponsor) are expressly permitted to engage in any other business or activity and to advise on real estate investment opportunities for other persons or entities, creating direct potential for competing investment opportunities and allocation-of-opportunity conflicts.

“Nothing contained herein shall prevent the Business Manager or an Affiliate of the Business Manager (including the Sponsor) from engaging in any other business or activity including rendering services or advising on real estate investment opportunities to any other person or entity.”

The charter expressly provides that the Company has no interest in any investment opportunity known to the Business Manager or its Affiliates unless affirmatively recommended to the Company, waiving the corporate opportunity doctrine for the externally-managed structure.

“For so long as the Company is externally advised by the Business Manager, the Company has no interest in any opportunity known to the Business Manager or an Affiliate thereof unless it has been recommended to the Company by the Business Manager or an Affiliate thereof. The preceding sentence shall be of no consequence except in connection with the application of the corporate opportunity doctrine.”

The charter restricts but permits the Company to purchase Real Estate Assets from affiliated parties (Sponsor, Business Manager, Directors) if approved by a majority of disinterested Independent Directors and the price does not exceed the Sponsor's cost (absent substantial justification). All affiliate sales, leases, loans, and joint ventures require majority Independent Director approval.

“The Company shall not purchase Real Estate Assets from the Sponsor, the Business Manager, any Real Estate Manager, a Director or any Affiliate thereof, unless a majority of Directors (including a majority of Independent Directors) not otherwise interested in the transaction approves the transaction as being fair and reasonable to the Company and the price for the Real Estate Assets is no greater than the cost paid by the Sponsor, the Business Manager, the Real Estate Manager, a Director or any Affiliate for the Real Estate Assets, unless substantial justification for the excess exists and the excess is, in the opinion of the Board (including a majority of the Independent Directors), reasonable”

The Corporation may invest in Joint Ventures with the Sponsor, Business Manager, Directors, or Affiliates only with majority Independent Director approval finding the transaction fair and reasonable; all other transactions with Sponsor/Business Manager/Directors/Affiliates similarly require majority Independent Director approval on arms-length terms.

“The Corporation may invest in Joint Ventures with the Sponsor, the Business Manager, one or more Directors or any Affiliate, only if a majority of Directors (including a majority of Independent Directors) not otherwise interested in the transaction approve such investment as being fair and reasonable to the Corporation and on substantially the same terms and conditions as those received by the other joint venturers.”

The Company and Business Manager acknowledge their relationship is subject to various conflicts of interest. The Business Manager and its Affiliates owe a fiduciary duty to the Company and Stockholders, but must balance Company interests against their own. Separately, Schedule 2(t) lists at least ten Inland-affiliated entities providing paid services to the Company (IT, legal, insurance, investment advisory, mortgage placement/servicing, communications, office services, personnel, property tax), creating pervasive related-party service arrangements.

“The Company and the Business Manager recognize that their relationship is subject to various conflicts of interest. The Business Manager, on behalf of itself and its Affiliates, acknowledges that the Business Manager and its Affiliates have a fiduciary relationship to the Company and to the Stockholders. The Business Manager, on behalf of itself and its Affiliates, shall endeavor to balance the interests of the Company with the interests of the Business Manager and its Affiliates in making any determination where a conflict of interest exists between the Company and the Business Manager or its Affiliates.”

The Company expressly waives any interest in investment opportunities known to the Business Manager or its Affiliates unless such opportunities have been recommended to the Company by the Business Manager, creating a structural conflict of interest.

“For so long as the Company is externally advised by the Business Manager, the Company has no interest in any opportunity known to the Business Manager or an Affiliate thereof unless it has been recommended to the Company by the Business Manager.”

When conflicts arise between the interests of the General Partner's shareholders and the Limited Partners, and the General Partner determines the conflict cannot be resolved without adverse impact to one party, the Agreement explicitly requires the conflict to be resolved in favor of the shareholders, not the Limited Partners.

“In the event of a conflict between the interests of its shareholders on one hand and the Limited Partners on the other, the General Partner shall endeavor in good faith to resolve the conflict in a manner not adverse to either its shareholders or the Limited Partners; provided, however, that for so long as the General Partner directly owns a controlling interest in the Partnership, any such conflict that the General Partner, in its sole and absolute discretion, determines cannot be resolved in a manner not adverse to either its shareholders or the Limited Partner shall be resolved in favor of the shareholders.”

The General Partner and its affiliates are expressly permitted to engage in business activities identical to or competing with the Partnership, with no obligation to offer such opportunities to the Partnership or Limited Partners. Additionally, affiliates may be retained by the Partnership and receive compensation determined solely by the General Partner.

“the General Partner shall be entitled to and may have business interests and engage in business activities in addition to those relating to the Partnership, including business interests and activities substantially similar or identical to those of the Partnership. Neither the Partnership nor any of the Limited Partners shall have any rights by virtue of this Agreement in any such business ventures, interests or activities... the General Partner shall have no obligation pursuant to this Agreement to offer any interest in any such business ventures, interests and activities to the Partnership or any Limited Partner”

Article XIII contemplates future internalization of the Business Manager and Property Managers. The Company and the related-party managers share the cost of an investment banker. Any business combination requires a fairness opinion and majority stockholder vote, but Inland Group / Sponsor shares are counted for quorum yet excluded from the vote count unless the proposal passes, creating a governance asymmetry.

“for these purposes only, any shares held by The Inland Group, Inc., the Sponsor or any of their Affiliates will be counted for purposes of determining the presence of quorum but will not, however, initially constitute a vote cast for purposes of determining the number of votes necessary to approve the acquisition. If the proposal receives the necessary votes to approve the acquisition, all shares held by The Inland Group, Inc., the Sponsor or any of their Affiliates may then be voted in favor of the transaction.”

The Sub-Advisor may seek the same Primary Target Investments for other clients simultaneously, requiring a board-approved fair allocation policy. The Sub-Advisor is sole and exclusive source of investments but manages competing mandates.

“In the event the Sub-Advisor or any of its Affiliates is seeking investments within the definition of Primary Target Investments for any other Person, the Sub-Advisor shall present to the Advisor and the Board of Directors an allocation policy that fairly allocates investment opportunities to the Company, on the one hand, and to such other Persons, on the other hand”

The Company may invest in Joint Ventures alongside the Sponsor, Business Manager, Directors or their Affiliates. Such transactions require Independent Director approval as fair and on substantially the same terms as other Joint Venturers, but structural conflicts exist because affiliated parties share economics in the same assets.

“The Company shall not invest in Joint Ventures with the Sponsor, the Business Manager, any Real Estate Manager, a Director or any Affiliate thereof as a partner, unless a majority of Directors (including a majority of Independent Directors) not otherwise interested in the transaction approves the investment as being fair and reasonable to the Company and on substantially the same terms and conditions as those received by other Joint Venturers.”

The charter elects out of the Maryland Business Combination Statute specifically for The Inland Group, Inc. and all named affiliates (Business Manager, Property Managers, Sponsor, Dealer Manager), removing statutory anti-takeover protections that would otherwise apply when these related parties engage in business combinations with the Company.

“the Maryland Business Combination Statute, found in Title 3, Subtitle 6 of the MGCL (as amended from time to time or any successor statute thereto), shall not apply to any 'business combination' (as defined in Section 3-601(e) of the MGCL, as amended from time to time or any successor statute thereto) of the Company and The Inland Group, Inc., a Delaware corporation, or any Affiliate of The Inland Group, Inc., including Inland American Business Manager & Advisor, Inc., an Illinois corporation, Inland American Retail Management LLC, a Delaware limited liability company, Inland American Office Management LLC, a Delaware limited liability company, Inland American Industrial Management LLC, a Delaware limited liability company, Inland American Apartment Management LLC, a Delaware limited liability company, Inland Real Estate Investment Corporation, a Delaware corporation or Inland Securities Corporation, a Delaware corporation.”

The charter elects out of the Maryland Control Share Acquisition Statute for The Inland Group and all named Inland affiliates, meaning these related parties can acquire large blocks of the Company's Equity Stock without triggering voting-right restrictions that would apply to unaffiliated acquirors.

“the Maryland Control Share Statute, found in Title 3, Subtitle 7 of the MGCL (as amended from time to time or any successor statute thereto), shall not apply to the acquisition of any Equity Stock of the Company by The Inland Group, Inc., a Delaware corporation, or any Affiliate of The Inland Group, Inc., including Inland American Business Manager & Advisor, Inc., an Illinois corporation, Inland American Retail Management LLC, a Delaware limited liability company, Inland American Office Management LLC, a Delaware limited liability company, Inland American Industrial Management LLC, a Delaware limited liability company, Inland American Apartment Management LLC, a Delaware limited liability company, Inland Real Estate Investment Corporation, a Delaware corporation or Inland Securities Corporation, a Delaware corporation.”

The Company explicitly waives any interest in corporate opportunities known to the Business Manager or its Affiliates unless the Business Manager recommends the opportunity to the Company. This gives the external advisor broad discretion to allocate investment opportunities away from the Company.

“For so long as the Company is externally advised by the Business Manager, the Company has no interest in any opportunity known to the Business Manager or an Affiliate thereof unless it has been recommended to the Company by the Business Manager or an Affiliate thereof.”