General Counsel Employment Agreement

Exhibit 10.4



EMPLOYMENT AGREEMENT



THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into as of April 21, 2008, but shall be effective, nunc pro tunc , as of January 1, 2008, by and between INLAND REAL ESTATE CORPORATION, a Maryland corporation (the "Company"), and Beth Sprecher Brooks (the "Executive" ).



RECITALS:



A. The Company is a real estate investment trust which owns, operates and acquires neighborhood retail centers and community centers within an approximate 400 mile radius of its headquarters in Oak Brook, Illinois (the "Business").



B. Executive has served as the Company92s General Counsel pursuant to an employment agreement, effective as of January 1, 2007, by and between the Company and Executive and during her employment thereunder, Executive has demonstrated certain unique and particular talents and abilities with regard to the Business.



C. The Company desires to continue to assure itself of the availability of the talents and abilities of Executive, by entering into a new employment agreement to become effective as of January 1, 2008.



D. Executive desires to continue to be employed by the Company, subject to the terms, conditions and covenants hereinafter set forth.



E. As a condition for the Company to enter into this Agreement, Executive has agreed to restrict her ability to enter into competition with the Company.



NOW, THEREFORE, in consideration of the foregoing and the agreements, covenants and conditions set forth herein, Executive and the Company hereby agree as follows:



ARTICLE I
EMPLOYMENT



1.1 Employment .



(a) The Company hereby employs and engages Executive, and Executive hereby accepts employment, upon the terms and conditions set forth in this Agreement. Effective as of January 1, 2008 (the "Effective Date"), Executive shall serve as General Counsel, Vice President and Secretary with duties commensurate with such position and such other duties and responsibilities as assigned from time to time by the Company.



(b) In addition, Executive shall provide advice, consultation and services to any other entities which control, are controlled by or are under common control with the Company now or in the future (collectively, "Affiliates"), as may be requested by the Company.












1.2 Activities and Duties During Employment . Executive represents and warrants to the Company that she is free to engage in full-time employment with the Company, and that she has no prior or other commitments or obligations of any kind to anyone else which would hinder or interfere with her acceptance of her obligations under this Agreement, or the exercise of her reasonable commercial efforts as an employee of the Company. During the Employment Term (as defined below), Executive agrees:



(a) to faithfully serve and further the interests of the Company in every lawful way, giving honest, diligent, loyal and cooperative service to the Company and its Affiliates;



(b) to comply with all reasonable rules and policies which are consistent with the terms of this Agreement and which, from time to time, may be adopted by the Company or its Affiliates; and



(c) to devote all of her business time, attention and efforts to the faithful and diligent performance of her services to the Company and its Affiliates.



ARTICLE II
TERM



2.1 Term . The term of employment under this Agreement shall commence on the Effective Date and shall last through and including December 31, 2009 (the "Employment Term") except as this Agreement may be terminated as provided in Section 2.2 .



2.2 Termination . The Employment Term and employment of Executive may be terminated as follows:



(a) By the Company immediately for Cause (as hereinafter defined).



(b) By the Company immediately without Cause.



(c) Automatically, without the action of either party, upon the death of Executive.



(d) By either party upon a determination of Total Disability (as hereinafter defined) of Executive.



(e) Voluntarily by Executive.



(f) By Executive, immediately for Good Reason (as hereinafter defined).



(g) On expiration of the Employment Term if not extended by the mutual consent of the Company and Executive.



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2.3 Definitions of "Cause," "Total Disability," Good Reason" and "Change of Control. "



(a) For the purpose of this Agreement, "Cause" shall mean: (i) conduct amounting to fraud, embezzlement, disloyalty or illegal misconduct in connection with Executive92s duties under this Agreement and as an employee of the Company; (ii) conduct that the Company reasonably believes has brought the Company into substantial public disgrace or disrepute; (iii) failure to perform her duties hereunder as reasonably directed by the Company after providing written notice of the failure to Executive and Executive has failed to cure within ten (10) days of receiving notice; (iv) gross negligence or willful misconduct by the Executive with respect to the Company, its clients, its employees and its activities; or (v) material breach by the Executive of this Agreement or any other agreement to which Executive and the Company are a party or any material breach by the Executive of any written policy adopted by the Company concerning conflicts of interest, standards of business conduct or fair employment practices and any other similar matter, provided that the Company has provided written notice of the breach to Executive and Executive has failed to cure the breach within ten (10) days of receiving notice.



(b) For purposes of this Agreement, Executive shall be determined to have a "Total Disability" upon the determination of a physician, acceptable to the Company and Executive that Executive is unable, by reason of accident or illness, to substantially perform her duties or is expected to be in the condition for periods totaling six (6) months (whether or not consecutive) during any period of twelve (12) months. Nothing herein shall limit Executive92s right to receive any payments to which Executive may be entitled under any disability or employee benefit plan of the Company or under any disability or insurance policy or plan. During a period of Total Disability prior to termination hereunder, Executive shall continue to receive her full compensation (including base salary) and benefits.



(c) "Good Reason" will mean any of the following events which have not been cured within ten (10) days following the Company92s receipt of Executive92s written notice specifying the events or factors constituting Good Reason:



(i) the Company requires Executive to relocate her principal residence to a location outside the Greater Chicago Metropolitan Area in order to perform her duties and responsibilities hereunder;



(ii) the Executive92s base salary or other compensation and benefits is reduced to less than the amount of the Base Salary and other compensation and benefits as set forth in Section 3.1 below;



(iii) a material breach by the Company of the provisions of this Agreement; or



(iv) following a Change of Control, the assignment to Executive of duties which constitute a material reduction in Executive92s title or authority and



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which are materially inconsistent with Executive92s position as contemplated by this Agreement.



(d) "Change of Control" shall mean any of the following events:



(i) the members of IREC92s board of directors as of the date of this Agreement fail to constitute a majority of the members of the board; provided , however , that any individual becoming a member of the board who is nominated or appointed to the board seat on the recommendation and approval of IREC92s Nominating and Corporate Governance Committee shall be treated as if he or she were a member of the board as of the date of this Agreement;



(ii) the disposition by IREC of all, or substantially all, of the assets of IREC; or



(iii) the termination and liquidation of IREC.



ARTICLE III
COMPENSATION AND BENEFITS





3.1 Compensation .



(a) Base Salary . During the Employment Term, the Company shall pay Executive a base salary (the "Base Salary") of $245,000 per annum.



(b) Annual Incentive Bonus . The Company shall, in addition to Executive92s Base Salary, pay Executive an Annual Incentive Bonus, which shall be payable within 120 days of the end of each fiscal year in accordance with the formula set forth on Exhibit A , attached hereto and made a part hereof.



(c) Annual Long Term Share Award . No later than June 30 of each fiscal year during the Employment Term, the Company shall grant Executive an Annual Long Term Share Award consisting of shares of the common stock of IREC ("Long Term Shares"), subject to the conditions set forth below and in accordance with the schedule set forth on Exhibit B , attached hereto and made a part hereof. Twenty percent (20%) of any Long Term Shares granted hereunder shall vest on each successive yearly anniversary of the grant of the Long Term Shares.



(i) All Long Term Shares shall be issued under, and in accordance with, IREC92s 2005 Equity Award Plan (the "2005 Equity Award Plan"); to the extent the terms of any Long Term Shares granted pursuant to this Agreement conflict with the terms of the 2005 Equity Award Plan, the terms of the 2005 Equity Award Plan shall apply to the minimum extent necessary to eliminate the conflict. Executive shall be the record owner of any Long Term Shares granted hereunder; provided that any Long Term Shares that have not yet vested shall be forfeited and redeemed by the Company, without any further action on the part of the Company or the Executive, if Executive is no longer employed by the Company for any reason, other than in connection with a termination as described



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in Sections 2.2(b), (c) or (d) . Executive may not sell, transfer, hypothecate, pledge or assign any Long Term Shares which have not vested.



(ii) Upon the occurrence of any forfeiture of Long Term Shares, Executive shall immediately take all actions necessary to permit the Company to redeem any forfeited Long Term Shares.



(iii) Unless forfeited, Executive may exercise all rights of a stockholder, including the right to vote and receive dividends with respect to any Long Term Shares granted Executive.



(iv) All Long Term Shares which may be issuable hereunder shall be issued in reliance upon the following representations, warranties and agreements of Executive, each of which shall be true and correct as of the date of issuance and each of which shall survive the termination of this Agreement.



(A) Executive acknowledges that the common stock underlying any Long Term Shares has been registered under the Securities Act of 1933, as amended (the " Securities Act"), pursuant to an effective registration statement on Form S-8 (file no. 333-128624);



(B) Executive acknowledges that once the common stock underlying any Long Term Shares has been issued to Executive, the common stock may not be subsequently transferred or sold by Executive except in compliance with the registration requirements of federal and state securities law or exemptions therefrom;



(C) Executive acknowledges that an investment in the IREC92s common stock is subject to significant risk, including the risks described, from time to time, in IREC92 s annual reports on Form 10-K. Executive represents and warrants that she has such knowledge and expertise in financial and business matters as to be capable of evaluating the merits and risks of an investment in IREC92s common stock and the ability to bear the economic risk of the investment; and



(D) Executive represents and warrants that she has had the opportunity to ask questions of the Company concerning its business and to obtain any information which she considers necessary to verify the accuracy of or to amplify upon the Company92s disclosures and that all questions which have been asked have been answered by the Company to Executive92s satisfaction.



(d) Annual Stock Option Award . No later than June 30 of each fiscal year during the Employment Term, the Company shall grant Executive an Annual Stock Option Award to purchase shares of the common stock of IREC ("Annual Stock Options"), subject to the conditions set forth below and in accordance with the schedule set forth on Exhibit C , attached hereto and made a part hereof. Twenty percent (20%) of



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any Annual Stock Options granted hereunder shall vest on each successive yearly anniversary of the grant of the Annual Stock Options.



(i) All Annual Stock Options shall be issued under, and in accordance with, the 2005 Equity Award Plan; to the extent the terms of any Annual Stock Options awarded pursuant to this Agreement conflict with the terms of the 2005 Equity Award Plan, the terms of the 2005 Equity Award Plan shall apply to the minimum extent necessary to eliminate the conflict. Any Annual Stock Options that have not yet vested shall be forfeited and redeemed by the Company, without any further action on the part of the Company or the Executive, if Executive is no longer employed by the Company for any reason, other than in connection with a termination as described in Sections 2.2(b), (c) or (d) . Executive may not sell, transfer, hypothecate, pledge or assign any Annual Stock Options which have not vested.



(ii) Upon the occurrence of any forfeiture of Annual Stock Options, Executive shall immediately take all actions necessary to permit the Company to redeem any forfeited Annual Stock Options.



(iii) All Annual Stock Options which may be issuable hereunder shall be issued in reliance upon the following representations, warranties and agreements of Executive, each of which shall be true and correct as of the date of issuance and each of which shall survive the termination of this Agreement.



(A) Executive acknowledges that the common stock underlying any Annual Stock Options has been registered under the Securities Act pursuant to an effective registration statement on Form S-8 (file no. 333-128624);



(B) Executive acknowledges that once the common stock underlying any Annual Stock Options has been issued to Executive, the common stock may not be subsequently transferred or sold by Executive except in compliance with the registration requirements of federal and state securities law or exemptions therefrom;



(C) Executive acknowledges that an investment in IREC92s common stock is subject to significant risk, including the risks described, from time to time, in IREC92s annual reports on Form 10-K. Executive represents and warrants that she has such knowledge and expertise in financial and business matters as to be capable of evaluating the merits and risks of an investment in IREC92s common stock and the ability to bear the economic risk of the investment; and



(D) Executive represents and warrants that she has had the opportunity to ask questions of the Company concerning its business and to obtain any information which she considers necessary to verify the accuracy of or to amplify upon the Company92s disclosures and that all



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questions which have been asked have been answered by the Company to Executive92 s satisfaction.



3.2 Payment . All Base Salary due Executive hereunder shall be paid in accordance with the general payroll payment practice of the Company for executive level employees; except that any payment relating to the termination of Executive shall be paid as a lump sum payment within fifteen (15) days of termination.



3.3 Business Expenses .



(a) Reimbursement . The Company shall reimburse Executive for all ordinary and necessary business expenses incurred by her in connection with the performance of her dutie ...