<PAGE> 1
As filed with the Securities and Exchange Commission on March 5, 1997,
amending reports filed on January 24, 1997 and March 3, 1997.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-KA
No. 1
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934
Date of Report: January 9, 1997
(Date of earliest event reported)
INLAND REAL ESTATE CORPORATION
(Exact name of registrant as specified in the charter)
Maryland 000-28382 36-3953261
(State or other jurisdiction (Commission File No.) (IRS Employer
of incorporation) Identification No.)
2901 Butterfield Road
Oak Brook, Illinois 60521
(Address of Principal Executive Offices)
(630) 218-8000
(Registrant's telephone number including area code)
n/a
(Former name or former address, if changed since last report)
<PAGE> 2
Item 7. Financial Statements and Exhibits
(a) Financial statements of businesses acquired.
<TABLE>
Page
Maple Park Place Shopping Center*
<S> <C>
Independent Auditors' Report ................................................ F-1
Historical Summary of Gross Income and Direct Operating Expenses for the
year ended December 31, 1996 of Maple Park Place Shopping Center ............ F-2
Notes to Historical Summary of Gross Income and Direct Operating Expenses
for the year ended December 31, 1996 of Maple Park Place Shopping Center .... F-3
Aurora Commons Shopping Center**
Independent Auditors' Report ................................................ F-5
Historical Summary of Gross Income and Direct Operating Expenses for the
year ended December 31, 1996 of Aurora Commons Shopping Center .............. F-6
Notes to Historical Summary of Gross Income and Direct Operating Expenses
for the year ended December 31, 1996 of Aurora Commons Shopping Center ...... F-7
Lincoln Park Place Shopping Center**
Independent Auditors' Report ................................................ F-9
Historical Summary of Gross Income and Direct Operating Expenses for the
year ended December 31, 1996 of Lincoln Park Place Shopping Center .......... F-10
Notes to Historical Summary of Gross Income and Direct Operating Expenses
for the year ended December 31, 1996 of Lincoln Park Place Shopping Center .. F-11
(b) Pro forma financial information.
Pro Forma Balance Sheet at December 31, 1995 (unaudited) .................... F-13
Notes to Pro Forma Balance Sheet at December 31, 1995 (unaudited) ........... F-15
Pro Forma Statement of Operations for the year ended
December 31, 1995 (unaudited) ............................................... F-24
Notes to Pro Forma Statement of Operations for the year
ended December 31, 1995 (unaudited) ......................................... F-26
</TABLE>
2
<PAGE> 3
<TABLE>
<S> <C>
Pro Forma Balance Sheet at September 30, 1996 (unaudited) ........... F-44
Notes to Pro Forma Balance Sheet at September 30, 1996 (unaudited) .. F-46
Pro Forma Statement of Operations for the nine months ended
September 30, 1996 (unaudited) ...................................... F-53
Notes to Pro Forma Statement of Operations for the nine months
ended September 30, 1996 (unaudited) ................................ F-55
</TABLE>
* Information required to be included under Item 2 with respect to Maple Park
Place Shopping Center was previously filed on an initial report on Form 8-K
made on January 24, 1997 and dated January 9, 1997.
** Information required to be included under Item 2 with respect to Aurora
Commons Shopping Center and Lincoln Park Place Shopping Center was
previously filed on an initial report on Form 8-K made on March 3, 1997
and dated January 24, 1997.
3
<PAGE> 4
Independent Auditors' Report
The Board of Directors
Inland Real Estate Corporation:
We have audited the accompanying Historical Summary of Gross Income and Direct
Operating Expenses (Historical Summary) of Maple Park Place for the year ended
December 31, 1996. This Historical Summary is the responsibility of the
management of the Inland Real Estate Corporation. Our responsibility is to
express an opinion on the Historical Summary based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the Historical Summary is free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the Historical Summary. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the Historical Summary. We believe that our audit provides a reasonable basis
for our opinion.
The accompanying Historical Summary was prepared for the purpose of complying
with the rules and regulations of the Securities and Exchange Commission and
for inclusion in the Registration Statement on Form S-11 of Inland Real Estate
Corporation, as described in note 2. It is not intended to be a complete
presentation of Maple Park Place's revenues and expenses.
In our opinion, the Historical Summary referred to above presents fairly, in
all material respects, the gross income and direct operating expenses described
in note 2 of Maple Park Place for the year ending December 31, 1996, in
conformity with generally accepted accounting principles.
KPMG Peat Marwick LLP
Chicago, Illinois
January 8, 1997
F-1
<PAGE> 5
Maple Park Place
Historical Summary of Gross Income and Direct Operating Expenses
Year ended December 31, 1996
Gross income:
Base rental income.............................. $1,844,314
Operating expense and real estate
tax recoveries................................ 405,223
Other income.................................... 641
-----------
Total Gross Income.............................. 2,250,178
-----------
Direct operating expenses:
Real estate taxes............................... 189,477
Operating expenses.............................. 104,640
Management fees................................. 77,853
Utilities....................................... 49,355
Insurance....................................... 23,065
-----------
Total direct operating expenses................. 444,390
-----------
Excess of gross income over direct
operating expenses.............................. $1,805,788
===========
See accompanying notes to historical summary of gross income and direct
operating expenses.
F-2
<PAGE> 6
Maple Park Place
Notes to Historical Summary of Gross Income and Direct Operating Expenses
Year ended December 31, 1996
1. Business
Maple Park Place (Maple Park) is located in Bolingbrook, Illinois. It
consists of approximately 220,000 square feet of gross leasable area and was
100% leased and occupied at December 31, 1996. Inland Real Estate
Corporation has signed a sale and purchase agreement for the purchase of
Maple Park from an unaffiliated third party (Seller).
2. Basis of Presentation
The Historical Summary of Gross Income and Direct Operating Expenses
(Historical Summary) has been prepared for the purpose of complying with
Rule 3-14 of the Securities and Exchange Commission Regulation S-X and for
inclusion in the Registration Statement on Form S-11 of Inland Real Estate
Corporation and is not intended to be a complete presentation of Maple
Park's revenues and expenses. The Historical Summary has been prepared on
the accrual basis of accounting and requires management of Maple Park to
make estimates and assumptions that affect the reported amounts of the
revenues and expenses during the reporting period. Actual results may
differ from those estimates.
3. Gross Income
Maple Park leases retail space under various lease agreements with its
tenants. All leases are accounted for as operating leases. Certain of
the leases include provisions under which Maple Park is reimbursed for
common area, real estate, and insurance costs. In addition, Maple Park
collects common area and insurance costs from a tenant of the parcel located
adjacent to Maple Park. Operating expenses and real estate tax recoveries
reflected in the Historical Summary include amounts for 1996 expenses for
which the tenants have not yet been billed. Certain leases contain renewal
options for various periods at various rental rates.
Base rentals are reported as income over the lease term as they become
receivable under the provisions of the leases. However, when rentals vary
from a straight-line basis due to short-term rent abatements or escalating
rents during the lease term, the income is recognized based on effective
rental rates. Related adjustments increased base rental income by $43,819
for the year ended December 31, 1996.
F-3
<PAGE> 7
Maple Park Place
Notes to Historical Summary of Gross Income and Direct Operating Expenses
Year ended December 31, 1996
Minimum rents to be received from tenants under operating leases in
effect at December 31, 1996 are as follows:
Year Amount
---- ------
1997 $ 1,773,056
1998 1,741,306
1999 1,682,846
2000 1,500,349
2001 1,434,626
Thereafter 20,758,807
-----------
$28,890,990
===========
4. Direct Operating Expenses
Direct operating expenses include only those costs expected to be
comparable to the proposed future operations of Maple Park. Costs such as
mortgage interest, depreciation, amortization, and professional fees are
excluded from the Historical Summary.
Maple Park has not received its final real estate tax bill for 1996. Real
estate tax expense is estimated based upon bills for 1995. The difference
between this estimate and the final bill is not expected to have a material
impact on the Historical Summary.
Maple Park is managed pursuant to the terms of a management agreement
for an annual fee of 3.75% of rental income (as defined), less a deduction
of $10,000 for unleased space during the year, plus a fixed amount of
$20,000 for the salary of the property manager. Subsequent to the sale of
Maple Park (note 1), the current management agreement will cease. Any new
management agreement may cause future management fees to differ from the
amounts reflected in the Historical Summary.
F-4
<PAGE> 8
Board of Directors
Inland Real Estate Corporation
Oak Brook, Illinois
We have audited the accompanying Historical Summary of Gross Income and Direct
Operating Expenses (Historical Summary) of Aurora Commons Partnership (An
Illinois Limited Partnership) D/B/A Aurora Commons Shopping Center as of
December 31, 1996. This Historical Summary is the responsibility of the
management of the partnership. Our responsibility is to express an opinion on
the Historical Summary based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the Historical Summary is free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the Historical Summary. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the Historical Summary. We believe that our audit provides a reasonable basis
for our opinion.
The accompanying Historical Summary was prepared for the purpose of complying
with the rules and regulations of the Securities and Exchange Commission and
for inclusion in the Registration Statement and Form S-11 of Inland Real Estate
Corporation as described in the notes. It is not intended to be a complete
presentation of Aurora Commons Partnership D/B/A Aurora Commons Shopping
Center's revenues and expenses.
In our opinion, the Historical Summary referred to above presents fairly, in
all material respects, the gross income and direct operating expenses described
in note 3 for the year ended December 31, 1996, in conformity with generally
accepted accounting principles.
Warady & Davis LLP
January 22, 1997
F-5
<PAGE> 9
Aurora Commons Partnership
D/B/A Aurora Commons Shopping Center
Historical Summary of Gross Income and Direct Operating Expenses
For the year ended December 31, 1996
REVENUES
Minimum Rent.................................. $ 1,145,656
Percentage Rent............................... 195,792
-----------
1,341,448
Tenant Reimbursements
Real Estate Taxes............................. 275,310
Common Area................................... 224,494
Other......................................... 34,443
-----------
Total Tenant Reimbursements................... 534,247
-----------
Gross Revenues................................ 1,875,695
Costs and Other (Income) Expenses
Common Area Expenses.......................... 209,951
General Expenses.............................. 49,224
Management Fees............................... 111,480
Real Estate Taxes and Contesting Fees......... 288,550
----------
Total Direct Operating Expenses............... 659,205
----------
Excess of Gross Revenue over
Direct Operating Expenses..................... $ 1,216,490
===========
See accompanying notes.
F-6
<PAGE> 10
Aurora Commons Partnership
D/B/A Aurora Commons Shopping Center
Notes to Financial Statements
Partnership Activity
The Partnership was established to construct, develop and operate a shopping
center located in Aurora, Illinois. The Center has a total gross leasable area
of approximately 227,000 square feet on 18 acres of which approximately 124,500
square feet was owned by the Partnership and was approximately 98% occupied at
December 31, 1996. On January 24, 1997, the Partnership was sold to Inland
Real Estate Corporation, an unaffiliated third party.
Note 1 - Summary of Significant Accounting Policies
This summary of significant accounting policies is presented to assist in
understanding the Partnership's Historical Summary. The Historical Summary and
notes are representations of management who is responsible for their integrity
and objectivity.
Basis of Preparation
The Historical Summary has been prepared for the purpose of complying with Rule
3-14 of the Securities and Exchange Commission Regulation S-X and for inclusion
in the Registration Statement on Form S-11 of Inland Real Estate Corporation
and is not intended to be a complete presentation of Aurora Commons
Partnership's revenues and expenses. The Historical Summary has been prepared
on the accrual basis of accounting and requires management to make estimates
and assumptions that affect the reported amounts of the revenues and expenses
during the reporting period.
Note 2 - Leasing Arrangements
The Partnership leases shopping center space to tenants under noncancelable
operating leases requiring fixed and contingent rentals based on sales in
excess of stipulated minimum levels. Real estate taxes and tenant share of
various other expenses are included in tenant reimbursements in the
accompanying Historical Summary.
The following is a schedule of future minimum rentals under these leases at
December 31, 1996 not including renewal option increases or any re-leasings:
Year Ending December 31,
1997................................ $ 1,147,010
1998................................ 1,038,804
1999................................ 916,509
2000................................ 664,033
2001................................ 554,041
Subsequent to 2001.................. 3,416,591
-----------
Aggregate Future Minimum Rentals.... $ 7,736,988
===========
F-7
<PAGE> 11
Aurora Commons Partnership
D/B/A Aurora Commons Shopping Center
Notes to Financial Statements
Note 2 - Leasing Arrangements (Continued)
Base rentals are reported as income over the lease term as they become
receivables under the provision of the leases. However, when rentals vary from
a straight-line basis due to short-term rent abatements or escalating rents
during the lease term, the income is recognized based on effective rental
rates. Related adjustments decreased base rental income by $9,606 for the year
ended December 31, 1996.
Note 3 - Direct Operating Expenses
Direct operating expenses include only those costs expected to be comparable to
the proposed future operations of Aurora Commons Partnership. Costs such as
mortgage interest, depreciation, amortization, and professional fees are
excluded from the Historical Summary.
The Partnership has not received its final real estate tax bill for 1996. Real
estate tax expense is based on 1995 tax bills. The difference between this
estimate and the final bill is not expected to have a material impact on the
Historical Summary. Tenant reimbursements for real estate taxes, common area
and other expenses are based on estimated expenses to be recovered. The
difference between this estimate and the final reconciled recoveries is not
expected to have a material impact on the Historical Summary.
Note 4 - Related Party Transactions
A Company under the control of Joseph J. Freed has provided management services
to the Partnership. Management fees of $111,480 for the year ended December
31, 1996 have been included in the Historical Summary.
Subsequent to the sale of Aurora Commons, as noted above, the current
management agreement will cease. Any new management agreement may cause future
management fees to differ from the amounts reflected in the Historical Summary.
F-8
<PAGE> 12
Board of Directors
Inland Real Estate Corporation
Oak Brook, Illinois
We have audited the accompanying Historical Summary of Gross Income and Direct
Operating Expenses (Historical Summary) of Clark & Diversey Property Limited
Partnership (An Illinois Limited Partnership) D/B/A Lincoln Park Place as of
December 31, 1996. This Historical Summary is the responsibility of the
management of the partnership. Our responsibility is to express an opinion on
the Historical Summary based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the Historical Summary is free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the Historical Summary. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the Historical Summary. We believe that our audit provides a reasonable basis
for our opinion.
The accompanying Historical Summary was prepared for the purpose of complying
with the rules and regulations of the Securities and Exchange Commission and
for inclusion in the Registration Statement and Form S-11 of Inland Real Estate
Corporation as described in the notes. It is not intended to be a complete
presentation of Clark & Diversey Property Limited Partnership D/B/A Lincoln
Park Place's revenues and expenses.
In our opinion, the Historical Summary referred to above presents fairly, in
all material respects, the gross income and direct operating expenses as
described in Note 3 for the year ended December 31, 1996, in conformity with
generally accepted accounting principles.
Warady & Davis LLP
January 24, 1997
F-9
<PAGE> 13
Clark & Diversey Property Limited Partnership
D/B/A Lincoln Park Place
Historical Summary of Gross Income and Direct Operating Expenses
For the year ended December 31, 1996
REVENUES
Minimum Rent................................. $ 228,218
Tenant Reimbursements
Real Estate Taxes............................ 105,000
Common Area.................................. 3,475
Other........................................ 3,522
----------
Total Tenant Reimbursements................ 111,997
----------
Gross Revenues............................... 340,215
Costs and Other (Income) Expenses
Common Area Expenses......................... 3,253
General Expenses............................. 4,746
Management Fees.............................. 17,177
Real Estate Taxes and Contesting Fees........ 105,000
----------
Total Direct Operating Expenses............ 130,176
----------
Excess of Gross Revenue over
Direct Operating Expenses.................... $ 210,039
==========
See accompanying notes.
F-10
<PAGE> 14
Clark & Diversey Property Limited Partnership
D/B/A Lincoln Park Place
Notes to Financial Statements
Partnership Activity
The Partnership operates 10,678 square feet of street front retail space
located in Chicago, Illinois. The center is 100% occupied and draws customers
from the surrounding Chicagoland area. On January 24, 1997 the Partnership was
sold to Inland Real Estate Corporation, an unaffiliated third party.
Note 1 - Summary of Significant Accounting Policies
This summary of significant accounting policies is presented to assist in
understanding the Partnership's Historical Summary. The Historical Summary and
notes are representations of management who is responsible for their integrity
and objectivity.
Basis of Preparation
The Historical Summary has been prepared for the purpose of complying with Rule
3-14 of the Securities and Exchange Commission Regulation S-X and for inclusion
in the Registration Statement on Form S-11 of Inland Real Estate Corporation
and is not intended to be a complete presentation of Clark & Diversey Property
Limited Partnership's revenues and expenses. The Historical Summary has been
prepared on the accrual basis of accounting and requires management to make
estimates and assumptions that affect the reported amounts of the revenues and
expenses during the reporting period.
Note 2 - Leasing Arrangements
The Partnership leases shopping center space to tenants under noncancelable
operating leases requiring fixed and contingent rentals based on sales in
excess of stipulated minimum levels. Real estate taxes and tenant share of
various other expenses are included in tenant reimbursements in the
accompanying Historical Summary.
The following is a schedule of future minimum rentals under these leases at
December 31, 1996 not including renewal option increases or any re-leasings:
Year Ending December 31
1997................................ $ 235,633
1998................................ 239,219
1999................................ 222,724
2000................................ 140,250
2001................................ 35,063
Subsequent to 2001.......................... -
---------
Aggregate Future Minimum Rentals............ $ 872,889
=========
F-11
<PAGE> 15
Clark & Diversey Property Limited Partnership
D/B/A Lincoln Park Place
Notes to Financial Statements
Note 2 - Leasing Arrangements (Continued)
Base rentals are reported as income over the lease term as they become
receivables under the provision of the leases. However, when rentals vary from
a straight-line basis due to short-term rent abatements or escalating rents
during the lease term, the income is recognized based on effective rental
rates. Related adjustments decreased base rental income by $1,956 for the year
ended December 31, 1996.
Note 3 - Direct Operating Expenses
Direct operating expenses include only those costs expected to be comparable to
the proposed future operations of Clark & Diversey Property Limited
Partnership. Costs such as mortgage interest, depreciation, amortization, and
professional fees are excluded from the Historical Summary.
The Partnership has not received its final real estate tax bill for 1996. Real
estate tax expense is based on 1996 assessed valuation. The difference between
this estimate and the final bill is not expected to have a material impact on
the Historical Summary. Tenant reimbursements for real estate taxes, common
area and other expenses are based on estimated amounts to be recovered. The
difference between this estimate and the final reconciled recoveries is not
expected to have a material impact on the Historical Summary.
Note 4 - Related Party Transactions
A Company under the control of Joseph J. Freed has provided management services
to the Partnership. Management fees of $17,177 for the year ended December 31,
1996 have been included in the Historical Summary.
Subsequent to the sale of Clark & Diversey Property Limited Partnership, as
noted above, the current management agreement will cease. Any new management
agreement may cause future management fees to differ from the amounts reflected
in the Historical Summary.
F-12
<PAGE> 16
Inland Real Estate Corporation
Pro Forma Balance Sheet
December 31, 1995
(unaudited)
The following unaudited Pro Forma Balance Sheet of the Company is presented to
effect the acquisitions of Mundelein Plaza, the Regency Point Shopping Center,
Prospect Heights Plaza, Montgomery-Sears Shopping Center, the Zany Brainy
store, Salem Square, Hawthorn Village Commons, Six Corners Plaza, Spring Hill
Fashion Corner, Grand and Hunt Club, The Quarry Outlot, Crestwood Plaza
Shopping Center, Park St. Claire, Lansing Square Shopping Center, Summit of
Park Ridge, Maple Park Place Shopping Center, Aurora Commons Shopping Center
and Lincoln Park Place Shopping Center as though these transactions occurred
December 31, 1995. This unaudited Pro Forma Balance Sheet should be read in
conjunction with the December 31, 1995 Financial Statements and the notes
thereto as filed on Form 10-K.
This unaudited Pro Forma Balance Sheet is not necessarily indicative of what
the actual financial position would have been at December 31, 1995, nor does it
purport to represent the future financial position of the Company. Unless
otherwise defined, capitalized terms used herein shall have the same meaning as
in the Prospectus.
F-13
<PAGE> 17
Inland Real Estate Corporation
Pro Forma Balance Sheet
December 31, 1995
(unaudited)
<TABLE>
<CAPTION>
December 31,
December 31, 1995
1995 Pro Forma Pro Forma
Historical(A) Adjustments(B) Balance Sheet
------------- -------------- -------------
<S> <C> <C> <C>
Assets
- ------
Net investment in
properties.................. $ 17,342,538 106,308,990 123,651,528
Cash and cash equivalents..... 738,931 - 738,931
Restricted cash............... 150,000 - 150,000
Accounts and rents
receivable.................. 333,823 2,289,458 2,623,281
Other assets.................. 185,585 164,751 350,336
------------- ------------- -------------
Total assets.................. $ 18,750,877 108,763,199 127,514,076
============= ============= =============
Liabilities and Stockholders' Equity
- ------------------------------------
Accounts payable and accrued
expenses.................... $ 288,037 7,500 295,537
Accrued real estate taxes..... 374,180 2,994,923 3,369,103
Distributions payable (C)..... 129,532 - 129,532
Security deposits............. 54,483 240,059 294,542
Mortgage payable.............. 750,727 36,413,089 37,163,816
Notes payable to Affiliate.... 360,000 - 360,000
Other liabilities............. 178,852 - 178,852
------------- ------------- -------------
Total liabilities............. 2,135,811 39,655,571 41,791,382
------------- ------------- -------------
Common Stock.................. 19,996 80,360 100,356
Additional paid in capital
(net of Offering costs)..... 16,835,183 69,027,268 85,862,451
Accumulated distributions in
excess of net income........ (240,113) - (240,113)
------------- ------------- -------------
Total Stockholders' equity.... 16,615,066 69,107,628 85,722,694
------------- ------------- -------------
Total liabilities and
Stockholders' equity........ $ 18,750,877 108,763,199 127,514,076
============= ============= =============
</TABLE>
See accompanying notes to pro forma balance sheet.
F-14
<PAGE> 18
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
December 31, 1995
(unaudited)
(A) The December 31, 1995 Historical column represents the historical balance
sheet as presented in the December 31, 1995 10-K as filed with the SEC.
(B) The following pro forma adjustment relates to the acquisition of the
subject properties as though they were acquired on December 31, 1995. The
terms are described in the notes that follow.
<TABLE>
<CAPTION>
Pro Forma Adjustments
---------------------------------------------------
Mundelein Regency Prospect Montgomery-
Plaza Point Heights Sears
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Assets
- ------
Net investment in
properties........ $ 5,658,230 5,700,000 2,165,000 3,419,000
Accounts and rent
receivable........ 84,375 16,867 38,771 27,842
Other assets........ - - - -
------------ ------------ ------------ ------------
Total assets........ $ 5,742,605 5,716,867 2,203,771 3,446,842
============ ============ ============ ============
Liabilities and Stockholders' Equity
- ------------------------------------
Accounts payable and
accrued expenses.. $ 7,500 - - -
Accrued real estate
taxes............. 89,010 16,867 63,517 32,655
Security deposits... 15,000 28,621 8,600 -
Mortgage payable.... - 4,473,200 - -
------------ ------------ ------------ ------------
Total liabilities... 111,510 4,518,688 72,117 32,655
------------ ------------ ------------ ------------
Common Stock(D)..... 6,548 1,393 2,479 3,970
Additional paid in
capital (net of
Offering costs)(D) 5,624,547 1,196,786 2,129,175 3,410,217
------------ ------------ ------------ ------------
Total Stockholders'
equity............ 5,631,095 1,198,179 2,131,654 3,414,187
------------ ------------ ------------ ------------
Total liabilities
and Stockholders'
equity............ $ 5,742,605 5,716,867 2,203,771 3,446,842
============ ============ ============ ============
</TABLE>
F-15
<PAGE> 19
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
December 31, 1995
(unaudited)
(B) Continued
<TABLE>
<CAPTION>
Pro Forma Adjustments
---------------------------------------------------
Hawthorn
Zany Salem Village Six
Brainy Square Commons Corners
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Assets
- ------
Net investment in
properties........ $ 2,455,000 6,173,850 8,450,000 6,000,000
Accounts and rent
receivable........ - 270,729 194,400 65,293
Other assets........ - - 39,550 -
------------ ------------ ------------ ------------
Total assets........ $ 2,455,000 6,444,579 8,683,950 6,065,293
============ ============ ============ ============
Liabilities and Stockholders' Equity
- ------------------------------------
Accounts payable and
accrued expenses.. $ - - - -
Accrued real estate
taxes............. - 270,729 194,400 217,643
Security deposits... - - - 15,542
Mortgage payable.... - - 2,900,000 -
------------ ------------ ------------ ------------
Total liabilities... - 270,729 3,094,400 233,185
------------ ------------ ------------ ------------
Common Stock(D)..... 2,855 7,179 6,499 6,781
Additional paid in
capital (net of
Offering costs)(D) 2,452,145 6,166,671 5,583,051 5,825,327
------------ ------------ ------------ ------------
Total Stockholders'
equity............ 2,455,000 6,173,850 5,589,550 5,832,108
------------ ------------ ------------ ------------
Total liabilities
and Stockholders'
equity............ $ 2,455,000 6,444,579 8,683,950 6,065,293
============ ============ ============ ============
</TABLE>
F-16
<PAGE> 20
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
December 31, 1995
(unaudited)
(B) Continued
<TABLE>
<CAPTION>
Pro Forma Adjustments
---------------------------------------------------
Spring Grand and
Hill Hunt Club Quarry Crestwood
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Assets
- ------
Net investment in
properties........ $ 9,200,000 3,592,000 1,800,000 1,808,760
Accounts and rent
receivable........ 95,470 - - 51,494
Other assets........ - - - -
------------ ------------ ------------ ------------
Total assets........ $ 9,295,470 3,592,000 1,800,000 1,860,254
============ ============ ============ ============
Liabilities and Stockholders' Equity
- ------------------------------------
Accounts payable and
accrued expenses.. $ - - - -
Accrued real estate
taxes............. 123,315 - - 51,494
Security deposits... 40,155 - - 12,800
Mortgage payable.... - - - 1,303,303
------------ ------------ ------------ ------------
Total liabilities... 163,470 - - 1,367,597
------------ ------------ ------------ ------------
Common Stock(D)..... 10,619 4,177 2,093 573
Additional paid in
capital (net of
Offering costs)(D) 9,121,381 3,587,823 1,797,907 492,084
------------ ------------ ------------ ------------
Total Stockholders'
equity............ 9,132,000 3,592,000 1,800,000 492,657
------------ ------------ ------------ ------------
Total liabilities
and Stockholders'
equity............ $ 9,295,470 3,592,000 1,800,000 1,860,254
============ ============ ============ ============
</TABLE>
F-17
<PAGE> 21
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
December 31, 1995
(unaudited)
(B) Continued
<TABLE>
<CAPTION>
Pro Forma Adjustments
----------------------------------------------------
Park Lansing Summit of Maple
St. Claire Square Park Ridge Park Place
------------ ------------ ------------ -------------
<S> <C> <C> <C> <C>
Assets
- ------
Net investment in
properties........ $ 1,525,000 16,300,000 3,200,000 15,262,150
Accounts and rent
receivable........ 26,391 825,340 162,643 173,777
Other assets........ - 80,000 - 20,000
------------ ------------ ------------ ------------
Total assets........ $ 1,551,391 17,205,340 3,362,643 15,455,927
============ ============ ============ ============
Liabilities and Stockholders' Equity
- ------------------------------------
Accounts payable and
accrued expenses.. $ - - - -
Accrued real estate
taxes............. 38,938 1,252,577 203,304 180,856
Security deposits... - 28,918 34,469 31,624
Mortgage payable.... - 8,000,000 - 8,000,000
------------ ------------ ------------ ------------
Total liabilities... 38,938 9,281,495 237,773 8,212,480
------------ ------------ ------------ ------------
Common Stock(D)..... 1,759 9,214 3,634 8,423
Additional paid in
capital (net of
Offering costs)(D) 1,510,694 7,914,631 3,121,236 7,235,024
------------ ------------ ------------ ------------
Total Stockholders'
equity............ 1,512,453 7,923,845 3,124,870 7,243,447
------------ ------------ ------------ ------------
Total liabilities
and Stockholders'
equity............ $ 1,551,391 17,205,340 3,362,643 15,455,927
============ ============ ============ ============
</TABLE>
F-18
<PAGE> 22
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
December 31, 1995
(unaudited)
(B) Continued
<TABLE>
<CAPTION>
Pro Forma Adjustments
---------------------------------------
Total
Aurora Lincoln Pro Forma
Commons Park Place Adjustment
------------ ------------ -------------
<S> <C> <C> <C>
Assets
- ------
Net investment in
properties........ $11,500,000 2,100,000 106,308,990
Accounts and rent
receivable........ 174,066 82,000 2,289,458
Other assets........ - 25,201 164,751
------------ ------------ -------------
Total assets........ $11,674,066 2,207,201 108,763,199
============ ============ =============
Liabilities and Stockholders' Equity
- ------------------------------------
Accounts payable and
accrued expenses.. $ - - 7,500
Accrued real estate
taxes............. 177,618 82,000 2,994,923
Security deposits... 24,330 - 240,059
Mortgage payable.... 9,720,476 2,016,110 36,413,089
------------ ------------ -------------
Total liabilities... 9,922,424 2,098,110 39,655,571
------------ ------------ ------------
Common Stock(D)..... 2,037 127 80,360
Additional paid in
capital (net of
Offering costs)(D) 1,749,605 108,964 69,027,268
------------ ------------ -------------
Total Stockholders'
equity............ 1,751,642 109,091 69,107,628
------------ ------------ -------------
Total liabilities
and Stockholders'
equity............ $11,674,066 2,207,201 108,763,199
============ ============ =============
</TABLE>
F-19
<PAGE> 23
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
(continued)
December 31, 1995
(unaudited)
Acquisition of Mundelein Plaza, Mundelein, Illinois
On March 29, 1996, the Company acquired the Mundelein Plaza property
located in Mundelein, Illinois ("Mundelein Plaza") from an unaffiliated
third party for a purchase price of $5,658,230, including closing costs of
$8,230, on an all cash basis, funded from cash and cash equivalents.
Acquisition of Regency Point Shopping Center, Lockport, Illinois
On April 5, 1996, the Company completed the acquisition of the Regency
Point Shopping Center located in Lockport, Illinois ("Regency Point"), from
an unaffiliated third party for a purchase price of $5,700,000. As part of
the acquisition, the Company will assume the existing first mortgage loan
of $4,473,200 along with a related interest rate swap agreement, with the
balance funded with cash and cash equivalents.
The first mortgage loan has a floating interest rate of 180 basis points
over the 30-day LIBOR rate, which rate is adjusted monthly. The interest
rate swap agreement, in conjunction with the first mortgage, provides for
Bank One, Chicago, to receive from or pay to the Company the difference
between 6.11% and the 30-day LIBOR rate, so that the first mortgage loan
has an effective rate of 7.91% per annum. The first mortgage loan matures
in August 2000. The related interest rate swap agreement was terminated on
April 18, 1996 resulting in $48,419 proceeds to the Company. No pro forma
adjustment has been made as a result of this termination.
Acquisition of Prospect Heights Plaza, Prospect Heights, Illinois
On June 17, 1996, the Company acquired this property from an unaffiliated
third party for the purchase price of $2,165,000 on an all cash basis,
funded from cash and cash equivalents.
Acquisition of Montgomery-Sears, Montgomery, Illinois
On June 17, 1996, the Company acquired this property from an unaffiliated
third party for the purchase price of $3,419,000 on an all cash basis,
funded from cash and cash equivalents.
Acquisition of Zany Brainy, Wheaton, Illinois
On July 1, 1996, the Company acquired this property from an unaffiliated
third party for the purchase price of $2,455,000 on an all cash basis,
funded from cash and cash equivalents.
F-20
<PAGE> 24
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
(continued)
December 31, 1995
(unaudited)
Acquisition of Salem Square, Countryside, Illinois
On August 2, 1996, the Company acquired this property from an unaffiliated
third party for the purchase price of $6,173,850, on an all cash basis,
funded from cash and cash equivalents.
Acquisition of Hawthorn Village Commons, Vernon Hills, Illinois
On August 15, 1996, the Company acquired this property from an unaffiliated
third party for the purchase price of $8,450,000.
The Company funded the purchase using: (i) the proceeds of a short-term
loan maturing August 23, 1996 in the amount of $2.9 million from Inland
Mortgage Investment Corporation ("IMIC"), an Affiliate of the Company (the
"Short-Term Loan"), and (ii) cash and cash equivalents. The Company did
not pay any fees in connection with the Short-Term Loan, which bears
interest at a rate of eight percent per annum. A majority of the Company's
board, including a majority of the Independent Directors has approved the
terms and conditions of the Short-Term Loan.
Acquisition of Six Corners, Chicago, Illinois
On October 18, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of approximately
$6,000,000, on an all cash basis, funded from cash and cash equivalents.
Acquisition of Spring Hill Fashion Center, West Dundee, Illinois
On November 13, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of approximately
$9,200,000, on an all cash basis, funded from cash and cash equivalents.
Acquisition of Grand and Hunt Club Outlot Center, Gurnee, Illinois
On December 24, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of $3,592,000 on an all
cash basis, funded from cash and cash equivalents.
Acquisition of the Quarry Outlot, Hodgkins, Illinois
On December 24, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of $1,800,000 on an all
cash basis, funded from cash and cash equivalents.
F-21
<PAGE> 25
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
(continued)
December 31, 1995
(unaudited)
Acquisition of Crestwood Plaza Shopping Center, Crestwood, Illinois
On December 27, 1996, the Company acquired this property from an affiliated
party, Inland Property Sales, for the purchase price of $1,808,760. As
part of the acquisition, the Company assumed the existing first mortgage
loan of 1,303,303 with the balance funded with cash and cash equivalents.
Acquisition of Park St. Claire Plaza, Schaumburg, Illinois
On December 31, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of $1,525,000, on an all
cash basis, funded from cash and cash equivalents.
Acquisition of Lansing Square Shopping Center, Lansing, Illinois
On December 31, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of $16,300,000.
The Company funded the purchase using: (i) the proceeds of five long-term
loans totaling $12,850,000 from LaSalle Bank of which approximately
$8,000,000 was used to purchase this property and (ii) cash and cash
equivalents. The Company paid a one point fee in connection with these
long-term loans. The loans have a term of seven years and, prior to the
maturity date, require payment of interest only, at 7.6%, fixed for five
years with the remaining two years at prime plus 1/2%.
Acquisition of The Summit of Park Ridge, Park Ridge, Illinois
On December 31, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of $3,200,000, on an all
cash basis, funded from cash and cash equivalents.
Acquisition of Maple Park Place Shopping Center, Bolingbrook, Illinois
On January 9, 1997, the Company acquired this property from an unaffiliated
third party for the purchase price of $15,262,150.
The Company funded the purchase using (i) the proceeds of a short-term loan
maturing April 7, 1997 in the amount of $8 million from Inland Mortgage
Investment Corporation ("IMIC"), an affiliate of the Company (the "Short-
Term Loan"), and (ii) cash and cash equivalents. The Short-Term Loan bears
interest at a rate of 9.0% per annum and requires a loan fee of 1/4%.
F-22
<PAGE> 26
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
(continued)
December 31, 1995
(unaudited)
Acquisition of Aurora Commons Shopping Center, Aurora, Illinois
On January 24, 1997, the Company acquired this property from an
unaffiliated third party for the purchase price of $11,500,000.
As part of the acquisition, the Company assumed the existing mortgage loan
maturing December 31, 2001, with the balance funded with cash and cash
equivalents. The assumed loan bears interest at a rate of 9% per annum
with monthly payments of principal and interest on the first day of each
month.
Acquisition of Lincoln Park Place Shopping Center, Chicago, Illinois
On January 24, 1997, the Company acquired this property from an
unaffiliated third party for the purchase price of $2,100,000.
The Company funded the purchase using the proceeds of a short-term loan
maturing February 3, 1997 in the amount of $2,016,110 from Inland Mortgage
Investment Corporation ("IMIC"), an affiliate of the Company (the "Short-
Term Loan"). The Company did not pay any fees in connection with the
Short-Term Loan, which bears interest at a rate of 9% per annum.
(C) No pro forma assumptions have been made for the additional payment of
distributions resulting from the additional proceeds raised.
(D) Additional Offering Proceeds of $80,360,000, net of additional Offering
costs of $11,252,372 are reflected as received as of December 31, 1995,
prior to the purchase of the properties. Offering costs consist
principally of registration costs, printing and selling costs, including
commissions.
F-23
<PAGE> 27
Inland Real Estate Corporation
Pro Forma Statement of Operations
For the year ended December 31, 1995
(unaudited)
The following unaudited Pro Forma Statement of Operations of the Company is
presented to effect the acquisitions of the Walgreens/Decatur property, Eagle
Crest Shopping Center, Montgomery-Goodyear property, Nantucket Square Shopping
Center, Mundelein Plaza, Regency Point Shopping Center, Prospect Heights Plaza,
Montgomery-Sears Shopping Center, Salem Square, Hawthorn Village Commons, Six
Corners Plaza, Spring Hill Fashion Corner, Crestwood Plaza Shopping Center,
Park St. Claire, Lansing Square Shopping Center, Summit of Park Ridge, Maple
Park Place Shopping Center, Aurora Commons Shopping Center and Lincoln Park
Place Shopping Center as though these transactions occurred on January 1, 1995.
Hartford/Naperville Plaza, Antioch Plaza and the Zany Brainy store were
constructed in 1995 and acquired shortly after construction was completed and
as such, the unaudited Pro Forma Statement of Operations of the Company is
presented to effect these acquisitions as of August 17, 1995, September 1, 1995
and November 22, 1995, respectively, the date occupancy commenced at these
properties. Grand and Hunt Club and the Quarry Outlot were constructed in
1996, as such, no operations are presented on the unaudited Pro Forma Statement
of Operations for 1995. This unaudited Pro Forma Statement of Operations
should be read in conjunction with the December 31, 1995 Financial Statements
and the notes thereto as filed on Form 10-K.
This unaudited Pro Forma Statement of Operations is not necessarily indicative
of what the actual results of operations would have been for the year ended
December 31, 1995, nor does it purport to represent the future results of
operations of the Company. Unless otherwise defined, capitalized terms used
herein shall have the same meaning as in the Prospectus.
F-24
<PAGE> 28
Inland Real Estate Corporation
Pro Forma Statement of Operations
for the year ended December 31, 1995
(unaudited)
<TABLE>
<CAPTION>
Pro Forma Adjustments
-----------------------------------
Acquisitions
1995
Historical 1995 1996 1997 1995
(A) (B) (C) (D) Pro Forma
---------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Rental
income.......... $ 869,485 585,614 7,163,124 3,217,369 11,835,592
Additional
rental income... 228,024 162,536 2,663,228 918,113 3,971,901
Interest
income (E)...... 82,913 - - - 82,913
---------- ----------- ----------- ----------- ------------
Total income.... 1,180,422 748,150 9,826,352 4,135,482 15,890,406
---------- ----------- ----------- ----------- ------------
Professional
services and
general and
administrative 23,132 - - - 23,132
Property operating
expenses........ 326,721 275,218 4,232,681 1,063,211 5,897,831
Interest expense.. 164,161 429,997 1,191,900 1,784,433 3,570,491
Depreciation (F).. 169,894 111,767 1,779,708 781,738 2,843,107
Amortization (H).. - - 11,429 6,457 17,886
---------- ----------- ----------- ----------- ------------
Total expenses.... 683,908 816,982 7,215,718 3,635,839 12,352,447
---------- ----------- ----------- ----------- ------------
Net income(loss) $ 496,514 (68,832) 2,610,634 499,643 3,537,959
========== =========== =========== =========== ============
Weighted average
common stock shares
outstanding (G). 943,156 8,979,156
========== ============
Net income per weighted
average common stock
outstanding (G). $ .53 .39
========== ============
</TABLE>
See accompanying notes to pro forma statement of operations.
F-25
<PAGE> 29
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
For the year ended December 31, 1995
(unaudited)
(A) The 1995 Historical column represents the historical statement of
operations of the Company for the year ended December 31, 1995, as filed
with the SEC on Form 10-K.
(B) Total pro forma adjustments for the year ended December 31, 1995 are as
though the acquisitions were acquired the earlier of January 1, 1995 or
date that operations commenced.
<TABLE>
<CAPTION>
Pro Forma Adjustments
---------------------------------------------------
Hartford
Montgomery- Naperville
Walgreens Eagle Crest Goodyear Plaza
----------- ----------- ------------ -----------
<S> <C> <C> <C> <C>
Rental
income.......... $ 10,651 95,232 101,359 15,077
Additional
Rental income... - 2,218 19,203 662
----------- ----------- ------------ -----------
Total income.... 10,651 97,450 120,562 15,739
----------- ----------- ------------ -----------
Property operating
expenses........ 533 17,376 47,758 3,436
Interest expense.. 4,840 77,170 46,325 13,625
Depreciation (F).. 3,141 16,324 20,682 8,867
----------- ----------- ------------ -----------
Total expenses.... 8,514 110,870 114,765 25,928
----------- ----------- ------------ -----------
Net income(loss) $ 2,137 (13,420) 5,797 (10,189)
=========== =========== ============ ===========
<CAPTION>
Total
Nantucket Antioch 1995
Square Plaza Pro Forma
----------- ----------- ------------
<S> <C> <C> <C>
Rental
income.......... $ 340,545 22,750 585,614
Additional
Rental income... 140,453 - 162,536
----------- ----------- -----------
Total income.... 480,998 22,750 748,150
----------- ----------- -----------
Property operating
expenses........ 205,903 212 275,218
Interest expense.. 267,137 20,900 429,997
Depreciation (F).. 57,357 5,396 111,767
----------- ----------- -----------
Total expenses.... 530,397 26,508 816,982
----------- ----------- -----------
Net income(loss) $ (49,399) (3,758) (68,832)
=========== =========== ===========
</TABLE>
F-26
<PAGE> 30
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
Acquisition of Walgreens/Decatur, Decatur, Illinois
In conjunction with the acquisition, the Company assumed a portion of the
first mortgage loan with a balance of $775,000. This mortgage has an
interest rate of 7.655%, amortizes over a 25-year period and matures May
31, 2004. The Company is responsible for monthly payments of principal
and interest of $5,689. The pro forma adjustment for interest expense for
the period prior to acquisition was estimated using the described loan
terms.
Acquisition of Eagle Crest Shopping Center, Naperville, Illinois
As part of the acquisition, the Company assumed a portion of the first
mortgage loan with a balance of $3,534,000, as well as entering into a
loan agreement with Inland Property Sales, Inc. ("IPS"), an Affiliate of
the Advisor, for the balance of the purchase price for $1,212,427. The
first mortgage bears interest at 9.5% per annum and the loan to IPS bears
interest at 10.5%. The pro forma adjustment for interest expense for the
period prior to acquisition was estimated using the described loan terms.
Acquisition of Montgomery-Goodyear, Montgomery, Illinois
As part of the acquisition, the Company entered into a loan agreement with
Inland Mortgage Investment Corporation ("IMIC"), an affiliate of the
Advisor, for $600,000 which bears interest of 10.9% per annum. The pro
forma adjustment for interest expense for the period prior to acquisition
was estimated using the described loan terms.
Acquisition of Hartford/Naperville Plaza, Naperville, Illinois
In conjunction with the acquisition, the Company entered into a loan
agreement with IMIC for $600,000 which bears interest of 10.9% per annum.
The pro forma adjustment for interest expense was estimated using the
described loan terms.
Acquisition of Nantucket Square Shopping Center, Schaumburg, Illinois
As part of the acquisition, the Company entered into a loan agreement with
IMIC for $3,550,000 which bears interest of 10.5% per annum. The pro
forma adjustment for interest expense for the period prior to acquisition
was estimated using the described loan terms.
F-27
<PAGE> 31
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
Acquisition of Antioch Plaza, Antioch, Illinois
This pro forma adjustment reflects the purchase of the Antioch Plaza
property as if the Company had purchased the property as of September 1,
1995, the date the first tenant occupied this newly constructed property.
The pro forma adjustment for operations for the period September 1, 1995
to December 28, 1995 (date of acquisition) was estimated using applicable
lease information. Blockbuster Video was the only tenant occupying the
property during that period. No pro forma adjustment was made for real
estate tax expense and the related recovery income since the property was
vacant land for most of 1995 and the amount would be difficult to estimate
and have an immaterial effect.
As part of the acquisition, the Company entered into a loan agreement with
Inland Real Estate Investment Corporation, an affiliate of the Advisor,
for $660,000 which bears interest of 9.5% per annum. The pro forma
adjustment for interest expense was estimated using the described loan
terms.
F-28
<PAGE> 32
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
(C) Total pro forma adjustments for 1996 Acquisitions are as though they were
acquired the earlier of January 1, 1995 or date that operations commenced.
<TABLE>
<CAPTION>
Pro Forma Adjustments
-----------------------------------------------------------
Mundelein Regency Prospect Montgomery- Zany
Plaza Point Heights Sears Brainy
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Rental
income.......... $ 639,124 541,085 164,152 327,610 28,643
Additional
Rental income... 66,669 63,294 116,175 76,182 5,030
----------- ----------- ----------- ----------- -----------
Total income.... 705,793 604,379 280,327 403,792 33,673
----------- ----------- ----------- ----------- -----------
Property operating
expenses........ 141,482 71,615 180,819 102,067 5,502
Interest expense.. - 351,900 - - -
Depreciation (F).. 128,233 162,500 46,900 83,200 4,422
----------- ----------- ----------- ----------- -----------
Total expenses.... 269,715 586,015 227,719 185,267 9,924
----------- ----------- ----------- ----------- -----------
Net income...... $ 436,078 18,364 52,608 218,525 23,749
=========== =========== =========== =========== ===========
Hawthorn
Salem Village Six Spring
Square Commons Corners Hill Crestwood
----------- ----------- ----------- ----------- -----------
Rental
income.......... $ 717,522 970,313 685,443 1,117,082 203,007
Additional
Rental income... 387,179 353,145 164,345 290,755 66,739
----------- ----------- ----------- ----------- -----------
Total income.... 1,104,701 1,323,458 849,788 1,407,837 269,746
----------- ----------- ----------- ----------- -----------
Property operating
expenses........ 435,021 407,404 584,070 366,360 73,358
Interest expense.. - 232,000 - - -
Depreciation (F).. 150,000 194,467 153,000 246,866 49,439
----------- ----------- ----------- ----------- -----------
Total expenses.... 585,021 833,871 737,070 613,226 122,797
----------- ----------- ----------- ----------- -----------
Net income...... $ 519,680 489,587 112,718 794,611 146,949
=========== =========== =========== =========== ===========
</TABLE>
F-29
<PAGE> 33
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
<TABLE>
<CAPTION>
Pro Forma Adjustments
-----------------------------------------------
Total
Park Lansing Summit of 1995
St. Claire Square Park Ridge Pro Forma
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Rental
income.......... $ 70,928 1,406,317 291,898 7,163,124
Additional
Rental income... 28,960 825,340 219,415 2,663,228
----------- ----------- ----------- -----------
Total income.... 99,888 2,231,657 511,313 9,826,352
----------- ----------- ----------- -----------
Property operating
expenses........ 82,601 1,508,113 274,269 4,232,681
Interest expense.. - 608,000 - 1,191,900
Depreciation (F).. 40,681 434,667 85,333 1,779,708
Amortization (H).. - 11,429 - 11,429
----------- ----------- ----------- -----------
Total expenses.... 123,282 2,562,209 359,602 7,215,718
----------- ----------- ----------- -----------
Net income(loss) $ (23,394) (330,552) 151,711 2,610,634
=========== =========== =========== ===========
</TABLE>
F-30
<PAGE> 34
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
Acquisition of Mundelein Plaza, Mundelein, Illinois
Reconciliation of Gross Income and Direct Operating Expenses for the year
ended December 31, 1995 prepared in accordance with Rule 3.14 of
Regulation S-X (*) to the Pro Forma Adjustments:
<TABLE>
<CAPTION>
Mundelein Plaza
-------------------------------------
*As Pro Forma
Reported Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $ 639,124 - 639,124
Additional rental income......... 66,669 - 66,669
----------- ----------- -----------
Total income..................... 705,793 - 705,793
----------- ----------- -----------
Property operating expenses...... 141,482 - 141,482
Interest expense................. - - -
Depreciation (F)................. - 128,233 128,233
----------- ----------- -----------
Total expenses................... 141,482 128,233 269,715
----------- ----------- -----------
Net income....................... $ 564,311 (128,233) 436,078
=========== =========== ===========
</TABLE>
Acquisition of Regency Point, Lockport, Illinois
As part of the acquisition, the Company will assume the existing first
mortgage loan of $4,473,200, along with a related interest rate swap
agreement.
The first mortgage loan has a floating interest rate of 180 basis points
over the 30-day LIBOR rate, which rate is adjusted monthly. The interest
rate swap agreement, in conjunction with the first mortgage, provides for
Bank One, Chicago, to receive from or pay to the Company the difference
between 6.11% and the 30-day LIBOR rate, so that the first mortgage loan
has an effective rate of 7.91% per annum. The pro forma adjustment for
interest expense for 1995 was estimated using the described loan terms.
The related interest rate swap agreement was terminated on April 18, 1996
resulting in $48,419 proceeds to the Company. The pro forma adjustment
does not give effect to the termination of this agreement.
F-31
<PAGE> 35
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
Reconciliation of Gross Income and Direct Operating Expenses for the year
ended December 31, 1995 prepared in accordance with Rule 3.14 of
Regulation S-X (*) to the Pro Forma Adjustments:
<TABLE>
<CAPTION>
Regency Point
-------------------------------------
*As Pro Forma
Reported Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $ 541,085 - 541,085
Additional rental income......... 63,294 - 63,294
----------- ----------- -----------
Total income..................... 604,379 - 604,379
----------- ----------- -----------
Property operating expenses...... 71,615 - 71,615
Interest expense................. - 351,900 351,900
Depreciation (F)................. - 162,500 162,500
----------- ----------- -----------
Total expenses................... 71,615 514,400 586,015
----------- ----------- -----------
Net income....................... $ 532,764 (514,400) 18,364
=========== =========== ===========
</TABLE>
Acquisition of Prospect Heights Plaza, Prospect Heights, Illinois
Reconciliation of Gross Income and Direct Operating Expenses for the year
ended December 31, 1995 prepared in accordance with Rule 3.14 of
Regulation S-X (*) to the Pro Forma Adjustments:
<TABLE>
<CAPTION>
Prospect Heights
-------------------------------------
*As Pro Forma
Reported Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $ 164,152 - 164,152
Additional rental income......... 116,175 - 116,175
----------- ----------- -----------
Total income..................... 280,327 - 280,327
----------- ----------- -----------
Property operating expenses...... 180,819 - 180,819
Interest expense................. - - -
Depreciation (F)................. - 46,900 46,900
----------- ----------- -----------
Total expenses................... 180,819 46,900 227,719
----------- ----------- -----------
Net income....................... $ 99,508 (46,900) 52,608
=========== =========== ===========
</TABLE>
F-32
<PAGE> 36
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
Acquisition of Montgomery-Sears, Montgomery, Illinois
Reconciliation of Gross Income and Direct Operating Expenses for the year
ended December 31, 1995 prepared in accordance with Rule 3.14 of
Regulation S-X (*) to the Pro Forma Adjustments:
<TABLE>
<CAPTION>
Montgomery-Sears
-------------------------------------
*As Pro Forma
Reported Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $ 327,610 - 327,610
Additional rental income......... 76,182 - 76,182
----------- ----------- -----------
Total income..................... 403,792 - 403,792
----------- ----------- -----------
Property operating expenses...... 102,067 - 102,067
Interest expense................. - - -
Depreciation (F)................. - 83,200 83,200
----------- ----------- -----------
Total expenses................... 102,067 83,200 185,267
----------- ----------- -----------
Net income....................... $ 301,725 (83,200) 218,525
=========== =========== ===========
</TABLE>
Acquisition of Zany Brainy, Wheaton, Illinois
This pro forma adjustment reflects the purchase of Zany Brainy as if the
Company had purchased the property as of January 1, 1995. Operations for
this property for the period from November 22, 1995 (date of occupancy) to
December 31, 1995 were estimated using the lease and operating expense
information supplied by the seller. This property was purchased on an all
cash basis.
F-33
<PAGE> 37
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
Acquisition of Salem Square, Countryside, Illinois
Reconciliation of Gross Income and Direct Operating Expenses for the year
ended December 31, 1995 prepared in accordance with Rule 3.14 of
Regulation S-X (*) to the Pro Forma Adjustments:
<TABLE>
<CAPTION>
Salem Square
-------------------------------------
*As Pro Forma
Reported Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $ 717,522 - 717,522
Additional rental income......... 387,179 - 387,179
----------- ----------- -----------
Total income..................... 1,104,701 - 1,104,701
----------- ----------- -----------
Property operating expenses...... 435,021 - 435,021
Interest expense................. - - -
Depreciation (F)................. - 150,000 150,000
----------- ----------- -----------
Total expenses................... 435,021 150,000 585,021
----------- ----------- -----------
Net income....................... $ 669,680 (150,000) 519,680
=========== =========== ===========
</TABLE>
Acquisition of Hawthorn Village Commons, Vernon Hills, Illinois
Reconciliation of Gross Income and Direct Operating Expenses for the year
ended December 31, 1995 prepared in accordance with Rule 3.14 of
Regulation S-X (*) to the Pro Forma Adjustments:
<TABLE>
<CAPTION>
Hawthorn Village Commons
-------------------------------------
*As Pro Forma
Reported Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $ 970,313 - 970,313
Additional rental income......... 353,145 - 353,145
----------- ----------- -----------
Total income..................... 1,323,458 - 1,323,458
----------- ----------- -----------
Property operating expenses...... 407,404 - 407,404
Interest expense................. - 232,000 232,000
Depreciation (F)................. - 194,467 194,467
----------- ----------- -----------
Total expenses................... 407,404 426,467 833,871
----------- ----------- -----------
Net income....................... $ 916,054 (426,467) 489,587
=========== =========== ===========
</TABLE>
F-34
<PAGE> 38
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
The Company funded the purchase of Hawthorn Village Commons using: (i) the
proceeds of a short-term loan maturing August 23, 1996 in the amount of
$2.9 million from Inland Mortgage Investment Corporation ("IMIC"), an
Affiliate of the Company (the "Short-Term Loan"), and (ii) cash and cash
equivalents. The Company did not pay any fees in connection with the
Short-Term Loan, which bears interest at a rate of 8% per annum. A
majority of the Company's board, including a majority of the Independent
Directors has approved the terms and conditions of the Short-Term Loan.
Acquisition of Six Corners, Chicago, Illinois
This pro forma adjustment reflects the purchase of Six Corners as if the
Company had acquired the property as of January 1, 1995. The year ended
December 31, 1995 is based on the Historical Summary of Gross Income and
Direct Operating Expenses for the year ended June 30, 1996 prepared in
accordance with Rule 3-14 of Regulation S-X and information provided by
the seller.
<TABLE>
<CAPTION>
Six Corners
-------------------------------------
Year Ended
December 31, Pro Forma
1995 Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $ 685,443 - 685,443
Additional rental income......... 164,345 - 164,345
----------- ----------- -----------
Total income..................... 849,788 - 849,788
----------- ----------- -----------
Property operating expenses...... 584,070 - 584,070
Interest expense................. - - -
Depreciation (F)................. - 153,000 153,000
----------- ----------- -----------
Total expenses................... 584,070 153,000 737,070
----------- ----------- -----------
Net income....................... $ 265,718 (153,000) 112,718
=========== =========== ===========
</TABLE>
F-35
<PAGE> 39
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
Acquisition of Spring Hill Fashion Center, West Dundee, Illinois
Reconciliation of Gross Income and Direct Operating Expenses for the year
ended December 31, 1995 prepared in accordance with Rule 3.14 of
Regulation S-X (*) to the Pro Forma Adjustments:
<TABLE>
<CAPTION>
Spring Hill Fashion Center
-------------------------------------
*As Pro Forma
Reported Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $1,117,082 - 1,117,082
Additional rental income......... 290,755 - 290,755
----------- ----------- -----------
Total income..................... 1,407,837 - 1,407,837
----------- ----------- -----------
Property operating expenses...... 366,360 - 366,360
Interest expense................. - - -
Depreciation (F)................. - 246,866 246,866
----------- ----------- -----------
Total expenses................... 366,360 246,866 613,226
----------- ----------- -----------
Net income....................... $1,041,477 (246,866) 794,611
=========== =========== ===========
</TABLE>
Acquisition of Crestwood Plaza Shopping Center, Crestwood, Illinois
This pro forma adjustment reflects the purchase of Crestwood Plaza
Shopping Center as if the Company had acquired the property as of January
1, 1995. The year ended December 31, 1995 is based on the Historical
Summary of Gross Income and Direct Operating Expenses for the year ended
October 31, 1996 prepared in accordance with Rule 3-14 of Regulations S-X
and information provided by the seller.
The mortgage loan assumed at the time of purchase was originally funded
January 1996, and accordingly, no pro forma adjustment has been made for
interest expense for the year ended December 31, 1995.
F-36
<PAGE> 40
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
<TABLE>
<CAPTION>
Crestwood
-------------------------------------
Year ended
December 31, Pro Forma
1995 Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $ 203,007 - 203,007
Additional rental income......... 66,739 - 66,739
----------- ----------- -----------
Total income..................... 269,746 - 269,746
----------- ----------- -----------
Property operating expenses...... 73,358 - 73,358
Interest expense................. - - -
Depreciation (F)................. - 49,439 49,439
----------- ----------- -----------
Total expenses................... 73,358 49,439 122,797
----------- ----------- -----------
Net income....................... $ 196,388 (49,439) 146,949
=========== =========== ===========
</TABLE>
Acquisition of Park St. Claire Plaza, Schaumburg, Illinois
Reconciliation of Gross Income and Direct Operating Expenses for the year
ended December 31, 1995 prepared in accordance with Rule 3.14 of
Regulation S-X (*) to the Pro Forma Adjustments:
<TABLE>
<CAPTION>
Park St. Claire
-------------------------------------
*As Pro Forma
Reported Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $ 70,928 - 70,928
Additional rental income......... 28,960 - 28,960
----------- ----------- -----------
Total income..................... 99,888 - 99,888
----------- ----------- -----------
Property operating expenses...... 82,601 - 82,601
Interest expense................. - - -
Depreciation (F)................. - 40,681 40,681
----------- ----------- -----------
Total expenses................... 82,601 40,681 123,282
----------- ----------- -----------
Net income....................... $ 17,287 (40,681) (23,394)
=========== =========== ===========
</TABLE>
F-37
<PAGE> 41
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
Acquisition of Lansing Square Shopping Plaza, Lansing Illinois
Reconciliation of Gross Income and Direct Operating Expenses for the year
ended December 31, 1995 prepared in accordance with Rule 3.14 of
Regulation S-X (*) to the Pro Forma Adjustments:
<TABLE>
<CAPTION>
Lansing Square
-------------------------------------
*As Pro Forma
Reported Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $ 1,406,317 - 1,406,317
Additional rental income......... 825,340 - 825,340
----------- ----------- -----------
Total income..................... 2,231,657 - 2,231,657
----------- ----------- -----------
Property operating expenses...... 1,508,113 - 1,508,113
Interest expense................. - 608,000 608,000
Depreciation (F)................. - 434,667 434,667
Amortization (H)................. - 11,429 11,429
----------- ----------- -----------
Total expenses................... 1,508,113 1,054,096 2,562,209
----------- ----------- -----------
Net income....................... $ 723,544 (1,054,096) (330,552)
=========== =========== ===========
</TABLE>
The Company funded the purchase using: (i) the proceeds of five long-term
loans totaling $12,850,000 from LaSalle Bank of which approximately
$8,000,000 was used to purchase this property and (ii) cash and cash
equivalents. The Company paid a one point fee in connection with these
long-term loans. The loan has a term of seven years and, prior to the
maturity date, requires payments of interest only, at 7.6%, fixed for five
years with the remaining two years at prime plus 1/2%.
F-38
<PAGE> 42
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
Acquisition of Summit of Park Ridge, Park Ridge, Illinois
This pro forma adjustment reflects the purchase of Summit of Park Ridge as
if the Company had acquired the property as of January 1, 1995. The year
ended December 31, 1995 is based on the Historical Summary of Gross Income
and Direct Operating Expenses for the ten months ended November 30, 1996
prepared in accordance with Rule 3-14 of Regulation S-X and information
provided by the Seller.
<TABLE>
<CAPTION>
Summit of Park Ridge
-------------------------------------
Year ended
December 31, Pro Forma
1995 Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $ 291,898 - 291,898
Additional rental income......... 219,415 - 219,415
----------- ----------- -----------
Total income..................... 511,313 - 511,313
----------- ----------- -----------
Property operating expenses...... 274,269 - 274,269
Interest expense................. - - -
Depreciation (F)................. - 85,333 85,333
----------- ----------- -----------
Total expenses................... 274,269 85,333 359,602
----------- ----------- -----------
Net income....................... $ 237,044 (85,333) 151,711
=========== =========== ===========
</TABLE>
F-39
<PAGE> 43
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
(D) Total pro forma adjustments for 1997 acquisitions are as though they were
acquired the earlier of January 1, 1995 or date that operations commenced.
<TABLE>
<CAPTION>
Pro Forma Adjustments
-----------------------------------------------
Total
Maple Aurora Lincoln 1995
Park Place Commons Park Place Pro Forma
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Rental
income.......... $1,667,944 1,314,509 234,916 3,217,369
Additional
Rental income... 336,441 479,804 101,868 918,113
----------- ----------- ----------- -----------
Total income.... 2,004,385 1,794,313 336,784 4,135,482
----------- ----------- ----------- -----------
Property operating
expenses........ 427,078 523,694 112,439 1,063,211
Interest expense.. 720,000 882,983 181,450 1,784,433
Depreciation (F).. 404,905 334,573 42,260 781,738
Amortization (H).. 2,857 - 3,600 6,457
----------- ----------- ----------- -----------
Total expenses.... 1,554,840 1,741,250 339,749 3,635,839
----------- ----------- ----------- -----------
Net income(loss) $ 449,545 53,063 (2,965) 499,643
=========== =========== =========== ===========
</TABLE>
F-40
<PAGE> 44
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
Acquisition of Maple Park Shopping Center, Bolingbrook, Illinois
This pro forma adjustment reflects the purchase of Maple Park Place
Shopping Center as if the Company had acquired the property as of January
1, 1995. The year ended December 31, 1995 is based on information
provided by the Seller.
The Company funded the purchase using (i) the proceeds of a short-term
loan maturing April 7, 1997 in the amount of $8 million from Inland
Mortgage Investment Corporation ("IMIC"), an affiliate of the Company (the
"Short-Term Loan"), and (ii) cash and cash equivalents. The Short-Term
Loan bears interest at a rate of 9.0% per annum and requires a loan fee of
1/4%.
<TABLE>
<CAPTION>
Maple Park Place
-------------------------------------
Year ended
December 31, Pro Forma
1995 Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $1,667,944 - 1,667,944
Additional rental income......... 336,441 - 336,441
----------- ----------- -----------
Total income..................... 2,004,385 - 2,004,385
----------- ----------- -----------
Property operating expenses...... 427,078 - 427,078
Interest expense................. - 720,000 720,000
Depreciation (F)................. - 404,905 404,905
Amortization (H)................. - 2,857 2,857
----------- ----------- -----------
Total expenses................... 427,078 1,127,762 1,554,840
----------- ----------- -----------
Net income....................... $1,577,307 (1,127,762) 449,545
=========== =========== ===========
</TABLE>
F-41
<PAGE> 45
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
Acquisition of Aurora Commons Shopping Center, Aurora, Illinois
This pro forma adjustment reflects the purchase of Aurora Commons Shopping
Center as if the Company had acquired the property as of January 1, 1995.
The year ended December 31, 1995 is based on information provided by the
Seller.
As part of the acquisition of Aurora Commons Shopping Center, the Company
assumed the existing mortgage loan, with the balance funded with cash and
cash equivalents. The assumed loan bears interest at a rate of 9% per
annum with monthly payments of principal and interest on the first day of
each month.
<TABLE>
<CAPTION>
Aurora Commons
-------------------------------------
Year Ended
December 31, Pro Forma
1995 Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $1,314,509 - 1,314,509
Additional rental income......... 479,804 - 479,804
----------- ----------- -----------
Total income..................... 1,794,313 - 1,794,313
----------- ----------- -----------
Property operating expenses...... 620,883 (97,189) 523,694
Interest expense................. - 882,983 882,983
Depreciation (F)................. - 334,573 334,573
----------- ----------- -----------
Total expenses................... 620,883 1,120,367 1,741,250
----------- ----------- -----------
Net income....................... $1,173,430 (1,120,367) 53,063
=========== =========== ===========
</TABLE>
F-42
<PAGE> 46
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the year ended December 31, 1995
(unaudited)
Acquisition of Lincoln Park Place Shopping Center, Chicago, Illinois
The Company funded the purchase of Lincoln Park Place Shopping Center using
the proceeds of a short-term loan maturing February 7, 1997 in the amount
of $2,016,110 from Inland Mortgage Investment Corporation ("IMIC"), an
affiliate of the Company (the "Short-Term Loan"). the Company did not pay
any fees in connection with the Short-Term Loan, which bears interest at a
rate of 9% per annum.
This pro forma adjustment reflects the purchase of Lincoln Park Place
Shopping Center as if the Company had acquired the property as of January
1, 1995. The year ended December 31, 1995 is based on information provided
by the Seller.
<TABLE>
<CAPTION>
Lincoln Park Place
-------------------------------------
Year ended
December 31, Pro Forma
1995 Adjustments Total
----------- ----------- -----------
<S> <C> <C> <C>
Rental income.................... $ 234,916 - 234,916
Additional rental income......... 101,868 - 101,868
----------- ----------- -----------
Total income..................... 336,784 - 336,784
----------- ----------- -----------
Property operating expenses...... 112,439 - 112,439
Interest expense................. - 181,450 181,450
Depreciation (F)................. - 42,260 42,260
Amortization (H).................. - 3,600 3,600
----------- ----------- -----------
Total expenses................... 112,439 227,310 339,749
----------- ----------- -----------
Net income....................... $ 224,345 (227,310) (2,965)
=========== =========== ===========
</TABLE>
(E) No pro forma adjustment has been made relating to interest income which
would have been earned on the additional Offering Proceeds raised.
(F) Depreciation expense is computed using the straight-line method, based upon
an estimated useful life of thirty years.
(G) The pro forma weighted average common stock shares for the year ended
December 31, 1995 was calculated by estimating the additional shares sold
to purchase each of the Company's properties on a weighted average basis.
(H) Loan fees are amortized over the term of the related loan.
F-43
<PAGE> 47
Inland Real Estate Corporation
Pro Forma Balance Sheet
September 30, 1996
(unaudited)
The following unaudited Pro Forma Balance Sheet of the Company is presented to
effect the acquisition of the Six Corners Plaza, Spring Hill Fashion Corner,
Grand and Hunt Club, The Quarry Outlot, Crestwood Plaza Shopping Center, Park
St. Claire, Lansing Square Shopping Center, Summit of Park Ridge, Maple Park
Place Shopping Center, Aurora Commons Shopping Center and Lincoln Park Place
Shopping Center as though these transactions occurred September 30, 1996. This
unaudited Pro Forma Balance Sheet should be read in conjunction with the
September 30, 1996 Financial Statements and the notes thereto as filed on Form
10-Q.
This unaudited Pro Forma Balance Sheet is not necessarily indicative of what
the actual financial position would have been at September 30, 1996, nor does
it purport to represent the future financial position of the Company. Unless
otherwise defined, capitalized terms used herein shall have the same meaning as
in the Prospectus.
F-44
<PAGE> 48
Inland Real Estate Corporation
Pro Forma Balance Sheet
September 30, 1996
(unaudited)
<TABLE>
<CAPTION>
September 30,
September 30, 1996
1996 Pro Forma Pro Forma
Historical(A) Adjustments(B) Balance Sheet
------------- ------------- --------------
<S> <C> <C> <C>
Assets
- ------
Net investment in
properties.................. $ 50,746,249 72,287,910 123,034,159
Cash and cash equivalents..... 19,250,977 - 19,250,977
Accounts and rents
receivable.................. 1,087,810 1,812,230 2,900,040
Other assets.................. 447,025 125,201 572,226
------------- ------------- -------------
Total assets.................. $ 71,532,061 74,225,341 145,757,402
============= ============= =============
Liabilities and Stockholders' Equity
- ------------------------------------
Accounts payable and accrued
expenses.................... $ 840,418 - 840,418
Accrued real estate taxes..... 981,687 2,019,166 3,000,853
Distributions payable (C)..... 372,337 - 372,337
Security deposits............. 112,374 205,438 317,812
Mortgages payable............. 18,003,626 30,579,050 48,582,676
Unearned income............... 62,650 - 62,650
Other liabilities............. 28,852 - 28,852
Due to Affiliates............. 244,040 - 244,040
------------- ------------- -------------
Total liabilities............. 20,645,984 32,803,654 53,449,638
------------- ------------- -------------
Common Stock.................. 59,824 48,164 107,988
Additional paid in capital
(net of Offering costs)..... 51,965,431 41,373,523 93,338,954
Accumulated distributions in
excess of net income........ (1,139,178) - (1,139,178)
------------- ------------- -------------
Total Stockholders' equity.... 50,886,077 41,421,687 92,307,764
------------- ------------- -------------
Total liabilities and
Stockholders' equity........ $ 71,532,061 74,225,341 145,757,402
============= ============= =============
</TABLE>
See accompanying notes to pro forma balance sheet.
F-45
<PAGE> 49
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
(continued)
September 30, 1996
(unaudited)
(A) The September 30, 1996 Historical column represents the historical balance
sheet as presented in the September 30, 1996 10-Q as filed with the SEC.
(B) The following pro forma adjustment relates to the acquisition of the
subject properties as though they were acquired on September 30, 1996. The
terms are described in the notes that follow.
<TABLE>
<CAPTION>
Pro Forma Adjustments
--------------------------------------
Six Spring Grand and
Corners Hill Hunt Club
------------ ------------ ------------
<S> <C> <C> <C>
Assets
- ------
Net investment in
properties........... $ 6,000,000 9,200,000 3,592,000
Accounts and rents
receivable........... 306,203 91,576 -
------------ ------------ ------------
Total assets........... $ 6,306,203 9,291,576 3,592,000
============ ============ ============
Liabilities and Stockholders' Equity
- ------------------------------------
Accrued real estate
taxes................ $ 336,487 97,421 -
Security deposits...... 15,542 40,155 -
Mortgages payable...... - - -
------------ ------------ ------------
Total liabilities...... 352,029 137,576 -
------------ ------------ ------------
Common Stock (D)....... $ 6,923 10,644 4,177
Additional paid in
capital (net of
Offering Costs)(D)... 5,947,251 9,143,356 3,587,823
------------ ------------ ------------
Total Stockholders'
equity............... 5,954,174 9,154,000 3,592,000
------------ ------------ ------------
Total liabilities and
Stockholders' equity. $ 6,306,203 9,291,576 3,592,000
============ ============ ============
</TABLE>
F-46
<PAGE> 50
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
(continued)
September 30, 1996
(unaudited)
(B) Continued
<TABLE>
<CAPTION>
Pro Forma Adjustments
--------------------------------------
Park
Quarry Crestwood St. Claire
------------ ------------ ------------
<S> <C> <C> <C>
Assets
- ------
Net investment in
properties........... $ 1,800,000 1,808,760 1,525,000
Accounts and rents
receivable........... - 53,639 23,627
------------ ------------ ------------
Total assets........... $ 1,800,000 1,862,399 1,548,627
============ ============ ============
Liabilities and Stockholders' Equity
- ------------------------------------
Accrued real estate
taxes................ $ - 53,639 47,785
Security deposits...... - 12,800 -
Mortgages payable...... - 1,303,303 -
------------ ------------ ------------
Total liabilities...... - 1,369,742 47,785
------------ ------------ ------------
Common Stock (D)....... $ 2,093 573 1,745
Additional paid in
capital(net of
Offering Costs)(D)... 1,797,907 492,084 1,499,097
------------ ------------ ------------
Total Stockholders'
equity............... 1,800,000 492,657 1,500,842
------------ ------------ ------------
Total liabilities and
Stockholders' equity. $ 1,800,000 1,862,399 1,548,627
============ ============ ============
</TABLE>
F-47
<PAGE> 51
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
(continued)
September 30, 1996
(unaudited)
(B) Continued
<TABLE>
<CAPTION>
Pro Forma Adjustments
--------------------------------------
Lansing Summit of Maple Park
Square Park Ridge Place
------------ ------------ ------------
<S> <C> <C> <C>
Assets
- ------
Net investment in
properties........... $16,300,000 3,200,000 15,262,150
Accounts and rents
receivable........... 868,035 134,486 142,108
Other assets........... 80,000 - 20,000
------------ ------------ ------------
Total assets........... $17,248,035 3,334,486 15,424,258
============ ============ ============
Liabilities and Stockholders' Equity
- ------------------------------------
Accrued real estate
taxes................ $ 986,404 160,102 142,108
Security deposits...... 28,918 34,469 49,224
Mortgages payable...... 8,000,000 - 8,000,000
------------ ------------ ------------
Total liabilities...... 9,015,322 194,571 8,191,332
------------ ------------ ------------
Common Stock (D)....... $ 9,573 3,651 8,410
Additional paid in
capital (net of
Offering Costs)(D)... 8,223,140 3,136,264 7,224,516
------------ ------------ ------------
Total Stockholders'
equity............... 8,232,713 3,139,915 7,232,926
------------ ------------ ------------
Total liabilities and
Stockholders' equity. $17,248,035 3,334,486 15,424,258
============ ============ ============
</TABLE>
F-48
<PAGE> 52
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
(continued)
September 30, 1996
(unaudited)
(B) Continued
<TABLE>
<CAPTION>
Pro Forma Adjustments
--------------------------------------
Total
Aurora Lincoln Pro Forma
Commons Park Place Adjustments
------------ ------------ ------------
<S> <C> <C> <C>
Assets
- ------
Net investment in
properties........... $11,500,000 2,100,000 72,287,910
Accounts and rents
receivable........... 130,550 62,006 1,812,230
Other assets........... - 25,201 125,201
------------ ------------ ------------
Total assets........... $11,630,550 2,187,207 74,225,341
============ ============ ============
Liabilities and Stockholders' Equity
- ------------------------------------
Accrued real estate
taxes................ $ 133,214 62,006 2,019,166
Security deposits...... 24,330 - 205,438
Mortgages payable...... 11,259,637 2,016,110 30,579,050
------------ ------------ ------------
Total liabilities...... 11,417,181 2,078,116 32,803,654
------------ ------------ ------------
Common Stock (D)....... $ 248 127 48,164
Additional paid in
capital (net of
Offering Costs)(D)..... 213,121 108,964 41,373,523
------------ ------------ ------------
Total Stockholders'
equity............... 213,369 109,091 41,421,687
------------ ------------ ------------
Total liabilities and
Stockholders' equity. $11,630,550 2,187,207 74,225,341
============ ============ ============
</TABLE>
F-49
<PAGE> 53
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
(continued)
September 30, 1996
(unaudited)
Acquisition of Six Corners, Chicago, Illinois
On October 18, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of approximately
$6,000,000, on an all cash basis, funded from cash and cash equivalents.
Acquisition of Spring Hill Fashion Center, West Dundee, Illinois
On November 13, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of approximately
$9,200,000, on an all cash basis, funded from cash and cash equivalents.
Acquisition of Grand and Hunt Club Outlot Center, Gurnee, Illinois
On December 24, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of $3,592,000 on an all
cash basis, funded from cash and cash equivalents.
Acquisition of The Quarry Outlot, Hodgkins, Illinois
On December 24, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of $1,800,000 on an all
cash basis, funded from cash and cash equivalents.
Acquisition of Crestwood Plaza Shopping Center, Crestwood, Illinois
On December 27, 1996, the Company acquired this property from an affiliated
party, Inland Property Sales, for the purchase price of $1,808,760. As
part of the acquisition, the Company assumed the existing first mortgage
loan of $1,303,303 with the balance funded with cash and cash equivalents.
Acquisition of Park St. Claire Plaza, Schaumburg, Illinois
On December 31, 1996, the Company acquired the property from an
unaffiliated third party for the purchase price of $1,525,000, on an all
cash basis, funded from cash and cash equivalents.
Acquisition of Lansing Square Shopping Center, Lansing, Illinois
On December 31, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of $16,300,000. The
Company funded the purchase using: (i) the proceeds of five long-term loans
totaling $12,850,000 from LaSalle Bank of which approximately $8,000,000
was used to purchase this property and (ii) cash and cash equivalents. The
Company paid a one point fee in connection with these long-term loans. The
loans have a term of seven years and, prior to the maturity date, require
payment of interest only, at 7.6%, fixed for five years with the remaining
two years at prime plus 1/2%.
F-50
<PAGE> 54
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
(continued)
September 30, 1996
(unaudited)
Acquisition of The Summit of Park Ridge, Park Ridge, Illinois
On December 31, 1996, the Company acquired this property from an
unaffiliated third party for the purchase price of $3,200,000, on an all
cash basis, funded from cash and cash equivalents.
Acquisition of Maple Park Place Shopping Center, Bolingbrook, Illinois
On January 9, 1997, the Company acquired this property from an unaffiliated
third party for the purchase price of $15,262,150.
The Company funded the purchase using (i) the proceeds of a short-term loan
maturing April 7, 1997 in the amount of $8 million from Inland Mortgage
Investment Corporation ("IMIC"), an affiliate of the company (the "Short-
Term Loan"), and (ii) cash and cash equivalents. The Short-Term Loan bears
interest at a rate of 9.0% per annum and requires a loan fee of 1/4%.
Acquisition of Aurora Commons Shopping Center, Aurora, Illinois
On January 24, 1997, the Company acquired this property from an
unaffiliated third party for the purchase price of $11,500,000.
As part of the acquisition, the Company assumed the existing mortgage loan
maturing December 31, 2001, with the balance funded with cash and cash
equivalents. The assumed loan bears interest at a rate of 9% per annum
with monthly payments of principal and interest on the first day of each
month.
Acquisition of Lincoln Park Place Shopping Center, Chicago, Illinois
On January 24, 1997, the Company acquired this property from an
unaffiliated third party for the purchase price of $2,100,000.
The Company funded the purchase using the proceeds of a short-term loan
maturing February 3, 1997 in the amount of $2,016,110 from Inland Mortgage
Investment Corporation ("IMIC"), an affiliate of the Company (the "Short-
Term Loan"). The Company did not pay any fees in connection with the
Short-Term Loan, which bears interest at a rate of 9% per annum.
F-51
<PAGE> 55
Inland Real Estate Corporation
Notes to Pro Forma Balance Sheet
(continued)
September 30, 1996
(unaudited)
(C) No pro forma assumptions have been made for the additional payment of
distributions resulting from the additional proceeds raised.
(D) Additional Offering Proceeds of $48,164,000, net of additional Offering
costs of $6,742,313 are reflected as received as of September 30, 1996,
prior to the purchase of the properties. Offering costs consist
principally of registration costs, printing and selling costs, including
commissions.
F-52
<PAGE> 56
Inland Real Estate Corporation
Pro Forma Statement of Operations
For the nine months ended September 30, 1996
(unaudited)
The following unaudited Pro Forma Statement of Operations of the Company is
presented to effect the acquisitions of Mundelein Plaza, Regency Point Shopping
Center, Prospect Heights Plaza, Montgomery-Sears Shopping Center, the Zany
Brainy store, Salem Square, Hawthorn Village Commons, Six Corners Plaza, Spring
Hill Fashion Corner, Crestwood Plaza Shopping Center, Park St. Claire, Lansing
Square Shopping Center, Summit of Park Ridge, Maple Park Place Shopping Center,
Aurora Commons Shopping Center and Lincoln Park Place Shopping Center as of
January 1, 1996. Grand and Hunt Club and the Quarry Outlot were constructed in
1996. Operations had not commenced as of September 30, 1996, and as such, no
operations are presented on the unaudited Pro Forma Statement of Operations for
September 30, 1996. This unaudited Pro Forma Statement of Operations should be
read in conjunction with the September 30, 1996 Financial Statements and the
notes thereto as filed on Form 10-Q.
This unaudited Pro Forma Statement of Operations is not necessarily indicative
of what the actual results of operations would have been for the nine months
ended September 30, 1996, nor does it purport to represent the future financial
position of the Company. Unless otherwise defined, capitalized terms used
herein shall have the same meaning as in the Prospectus.
F-53
<PAGE> 57
Inland Real Estate Corporation
Pro Forma Statement of Operations
For the nine months ended September 30, 1996
(unaudited)
<TABLE>
<CAPTION>
1996 Total
Historical Pro Forma 1996
(A) Adjustments(B) Pro Forma
------------- -------------- ------------
<S> <C> <C> <C>
Rental income............... $ 2,578,953 7,652,888 10,231,841
Additional rental income.... 785,719 3,366,476 4,152,195
Interest income (C)......... 212,063 - 212,063
Other income................ 64,870 - 64,870
------------- -------------- ------------
Total income.............. 3,641,605 11,019,364 14,660,969
------------- -------------- ------------
Professional services and
general and
administrative fees....... 120,919 - 120,919
Advisor asset management
fee....................... 242,341 699,379 941,720
Property operating expenses. 1,146,661 3,990,379 5,137,040
Interest expense............ 210,132 2,061,594 2,271,726
Depreciation (D)............ 561,983 2,105,490 2,667,473
Amortization................ 4,119 13,415 17,534
Acquisition costs expensed.. 22,511 - 22,511
------------- -------------- ------------
Total expenses.............. 2,308,666 8,870,257 11,178,923
------------- -------------- ------------
Net income................ $ 1,332,939 2,149,107 3,482,046
============= ============== ============
Weighted average
common stock shares
outstanding (E)........... 3,688,310 8,504,710
============= ============
Net income per weighted
average common stock
outstanding (E)........... $ .36 .41
============= ============
</TABLE>
See accompanying notes to pro forma statement of operations.
F-54
<PAGE> 58
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
For the nine months ended September 30, 1996
(unaudited)
(A) The 1996 Historical column represents the historical statement of
operations of the Company for the nine months ended September 30, 1996, as
filed with the SEC on Form 10-Q.
(B) Total pro forma adjustments for the nine months ended September 30, 1996
are as though the acquisitions of the following properties occurred on
January 1, 1996 on an all cash basis except for the following:
Regency Point
In the purchase of Regency Point the Company assumed the existing first
mortgage loan of $4,473,200, along with a related interest rate swap
agreement. The first mortgage loan has a floating interest rate of 180
basis points over the 30-day LIBOR rate, which rate is adjusted monthly.
The interest rate swap agreement, in conjunction with the first mortgage,
provides for Bank One, Chicago, to receive from or pay to the Company the
difference between 6.11% and the 30-day LIBOR rate, so that the first
mortgage loan has an effective rate of 7.91% per annum. The pro forma
adjustment for interest expense for 1996 was estimated using the described
loan terms. The related interest rate swap agreement was terminated on
April 18, 1996 resulting in $48,419 proceeds to the Company. The pro forma
adjustment does not give effect to the termination of this agreement.
Hawthorn Village Commons
The Company funded the purchase of Hawthorn Village Commons using: (i) the
proceeds of a short-term loan maturing August 23, 1996 in the amount of
$2.9 million from Inland Mortgage Investment Corporation ("IMIC"), an
Affiliate of the Company (the "Short-Term Loan"), and (ii) cash and cash
equivalents. The Company did not pay any fees in connection with the
Short-Term Loan, which bears interest at a rate of eight percent per annum.
A majority of the Company's board, including a majority of the Independent
Directors has approved the terms and conditions of the Short-Term Loan.
Crestwood Plaza Shopping Center
As part of the December 27, 1996 purchase of Crestwood Plaza, the Company
assumed the existing first mortgage loan of $1,330,253.
F-55
<PAGE> 59
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the nine months ended September 30, 1996
(unaudited)
Lansing Square Shopping Center
The Company funded the purchase using: (i) the proceeds of five long-term
loans totaling $12,850,000 from LaSalle Bank of which approximately
$8,000,000 was used to purchase this property and (ii) cash and cash
equivalents. The Company paid a one point fee in connection with these
long-term loans. The loans have a term of seven years and, prior to the
maturity date, require payments of interest only, at 7.6%, fixed for five
years with the remaining two years at prime plus 1/2%.
Maple Park Place Shopping Center
The Company funded the purchase using (i) the proceeds of a short-term loan
maturing April 7, 1997 in the amount of $8 million from Inland Mortgage
Investment Corporation ("IMIC"), an affiliate of the company (the "Short-
Term Loan"), and (ii) cash and cash equivalents. The Short-Term Loan bears
interest at a rate of 9.0% per annum and requires a loan fee of 1/4%.
Aurora Commons Shopping Center, Aurora, Illinois
As part of the acquisition of Aurora Commons Shopping Center, the Company
assumed the existing mortgage loan maturing December 31, 2001, with the
balance funded with cash and cash equivalents. The assumed loan bears
interest at a rate of 9% per annum with monthly payments of principal and
interest on the first day of each month.
Lincoln Park Place Shopping Center
The Company funded the purchase of Lincoln Park Place Shopping Center using
the proceeds of a short-term loan maturing February 7, 1997 in the amount
of $2,016,110 from Inland Mortgage Investment Corporation ("IMIC"), an
affiliate of the Company (the "Short-Term Loan"). The Company did not pay
any fees in connection with the Short-Term Loan, which bears interest at a
rate of 9% per annum.
F-56
<PAGE> 60
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the nine months ended September 30, 1996
(unaudited)
<TABLE>
<CAPTION>
Mundelein Regency Prospect Montgomery- Zany
Plaza Point Heights Sears Brainy
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Rental income..... $ 163,381 139,271 89,105 163,700 137,489
Additional rental
income.......... 32,975 16,034 83,593 57,012 24,144
Interest income... - - - - -
----------- ----------- ----------- ----------- -----------
Total income...... 196,356 155,305 172,698 220,712 161,633
----------- ----------- ----------- ----------- -----------
Property operating
expenses........ 53,986 19,046 91,364 66,944 30,331
----------- ----------- ----------- ----------- -----------
Total expenses.... 53,986 19,046 91,364 66,944 30,331
----------- ----------- ----------- ----------- -----------
Net income........ $ 142,370 136,259 81,334 153,768 131,302
=========== =========== =========== =========== ===========
</TABLE>
F-57
<PAGE> 61
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the nine months ended September 30, 1996
(unaudited)
<TABLE>
<CAPTION>
Hawthorn
Salem Village Six Spring
Square Commons Corners Hill Crestwood
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Rental income..... $ 422,146 548,667 749,262 808,264 152,255
Additional rental
income.......... 260,832 270,570 490,551 200,033 51,986
----------- ----------- ----------- ----------- -----------
Total income...... 682,978 819,237 1,239,813 1,008,297 204,241
----------- ----------- ----------- ----------- -----------
Property operating
expenses........ 270,756 293,132 607,048 257,627 58,837
----------- ----------- ----------- ----------- -----------
Total expenses.... 270,756 293,132 607,048 257,627 58,837
----------- ----------- ----------- ----------- -----------
Net income........ $ 412,222 526,105 632,765 750,670 145,404
=========== =========== =========== =========== ===========
Park Lansing Park Maple Park Aurora
St. Claire Square Ridge Place Commons
------------ ---------- ----------- ----------- -----------
Rental income..... $ 71,317 1,568,672 259,024 1,315,337 888,811
Additional rental
income.......... 37,148 998,368 179,194 274,903 310,727
------------ ---------- ----------- ----------- -----------
Total income...... 108,465 2,567,040 438,218 1,590,240 1,199,538
------------ ---------- ----------- ----------- -----------
Property operating
expenses........ 77,540 1,132,906 224,982 326,774 392,771
------------ ---------- ----------- ----------- -----------
Total expenses.... 77,540 1,132,906 224,982 326,774 392,771
------------ ---------- ----------- ----------- -----------
Net income........ $ 30,925 1,434,134 213,236 1,263,466 806,767
============ ========== =========== =========== ===========
</TABLE>
F-58
<PAGE> 62
Inland Real Estate Corporation
Notes to Pro Forma Statement of Operations
(continued)
For the nine months ended September 30, 1996
(unaudited)
<TABLE>
<CAPTION>
Lincoln Pro Forma
Park Place Adjustments Total
------------ ----------- ------------
<S> <C> <C> <C>
Rental income..... $ 176,187 - 7,652,888
Additional rental
income.......... 78,406 - 3,366,476
------------ ----------- ------------
Total income...... 254,593 - 11,019,364
------------ ----------- ------------
Advisor asset
management fee.. - 699,379 699,379
Property operating
expenses........ 86,335 - 3,990,379
Interest expense.. - 2,061,594 2,061,594
Depreciation (D).. - 2,105,490 2,105,490
Amortization (F).. - 13,415 13,415
------------ ----------- ------------
Total expenses.... 86,335 4,879,878 8,870,257
------------ ----------- ------------
Net income........ $ 168,258 (4,879,878) 2,149,107
============ =========== ============
</TABLE>
(C) No pro forma adjustment has been made relating to interest income which
would have been earned on the additional Offering Proceeds raised.
(D) Depreciation expense is computed using the straight-line method, based upon
an estimated useful life of thirty years.
(E) The pro forma weighted average common stock shares for the nine months
ended September 30, 1996 was calculated by estimating the additional shares
sold to purchase each of the Company's properties on a weighted average
basis.
(F) Loan fees are amortized over the term of the related loan.
F-59
<PAGE> 63
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Inland Real Estate Corporation
(Registrant)
By: /s/ Kelly Tucek
---------------------------------
Kelly Tucek
Chief Financial and Accounting Officer
Date: March 4, 1997
-------------
