THE CORPORATE LIBRARY

Related Party Transactions and Outside Related Director Information

Inland Real Estate Corporation (IRC)

4/28/2006 Proxy Information

During the year ended December 31, 2005, we purchased various administrative services, such as payroll preparation and management, data processing, insurance consultation and placement, investor relations, property tax reduction services and mail processing from or through affiliates of The Inland Group, Inc., known as “TIGI.” Two of our existing directors, Messrs. Goodwin and Parks, are directors and stockholders of TIGI. We pay for these services on an hourly basis. The hourly rate is based on the salary of the individual rendering the services, plus a pro rata allocation of overhead including, but not limited to, employee benefits, rent, materials, fees, taxes and operating expenses incurred by each entity in operating their respective businesses. Computer services were purchased at a contract rate of $50.00 per hour. For the year ended December 31, 2005, these expenses, totaling $775,000, were categorized as general and administrative expenses and property operating expenses. We will continue to purchase these services from TIGI affiliates.

Additionally, we lease our corporate office space from an affiliate of TIGI. Payments under this lease for the year ended December 31, 2005 were $284,000, and were also categorized as general and administrative expenses.

On February 1, 2001, one of our wholly-owned subsidiaries entered into a limited liability company agreement with a wholly-owned subsidiary of Tri-Land Properties, Inc. to acquire and redevelop the Century Consumer Mall in Merrillville, Indiana. Richard Dube, the brother-in-law of Mr. Daniel Goodwin, one of our directors, is the president and a principal owner of Tri-Land. Each partner’s initial equity contribution was $500,000. In addition, we had committed to lend the LLC up to $17,800,000. Draws on the loan bear interest at a rate of 9% per annum, with interest only paid monthly on average outstanding balances. The loan is secured by the property and had an initial maturity date of January 31, 2006.

On June 30, 2005, we entered into a buy-out and restructuring agreement with regard to the Tri-Land venture. A wholly owned subsidiary of Tri-Land Properties, Inc. purchased our entire economic interest in this joint venture for $1,000,000 including additional interest and preferred returns. This payment was made in the form of $500,000 in cash and the remaining $500,000 was funded through an increase in the outstanding mortgage loan balance. We will continue to be a lender to the wholly owned subsidiary of Tri-Land Properties, Inc. for this redevelopment project. The terms of the loan were revised with the June 30, 2005 agreement. We agreed to lend Tri-Land Properties, Inc. up to $21,500,000. Draws on the loan bear interest at a rate of 8.5% per annum, with 5.5% to be paid currently and the remaining 3% to be accrued and paid upon maturity. Tri-Land Properties Inc. has guaranteed $1,000,000 of this mortgage receivable. As a result of the agreement, we deconsolidated the joint venture effective June 30, 2005. We have recorded a deferred gain of $3,193,000 on the sale of our equity investment, as we did not qualify for gain recognition due to our lack of initial investment and continuing involvement.

On August 12, 2003, we entered into an agreement with Inland Investment Advisors, Inc., an affiliate of TIGI, to manage our investment in securities. We pay a fee equal to three quarter of one percent (0.75%) per annum on the net asset value under management. We paid approximately $98,000 for these services during the year ended December 31, 2005.

In May 2005, we acquired a 1% interest in The Inland Real Estate Group of Companies, Inc. for a purchase price of $1,000. The Inland Real Estate Group of Companies, Inc. will provide assistance in the marketing of our investment properties and will provide representation at various trade shows and conventions.