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Exhibit 10.5
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TAX INDEMNIFICATION AGREEMENT
THIS TAX INDEMNIFICATION AGREEMENT (the "Agreement") is made and
entered into as of _______________, 1997, by and between Cardinal Realty
Services, Inc., an Ohio corporation ("Cardinal"), and Lexreit Properties, Inc.,
an Ohio corporation ("Company").
WHEREAS, in connection with Cardinal's distribution to its shareholders
of 93% of the outstanding common stock of Company (the date of such distribution
being referred to as the "Distribution Date") the parties have agreed to execute
this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. INDEMNITY. Cardinal covenants and agrees to indemnify, defend
and hold Company harmless from any and all costs, expenses, losses or
liabilities, including, without limitation, reasonable attorneys' fees, incurred
by Company, or any of its subsidiaries, resulting from, attributable to or
arising under any of the following:
(a) any federal, state, local or foreign tax liabilities
(including penalties, interest and additions to tax) of Company or any
of its current subsidiaries for all taxable periods ending on or
before the Distribution Date;
(b) any federal, state, local or foreign tax liabilities
(including penalties, interest and additions to tax) of any
subsidiaries that Cardinal contributes to Company after the
Distribution Date for all taxable periods ending on or before the
date any such subsidiary is contributed to Company;
(c) any federal income tax liabilities (including penalties,
interest and additions to tax) that Company or any of its subsidiaries
is, or may be, liable for under Treasury Regulation Section 1.1502-6(a)
as a result of being a member of the Cardinal affiliated group for any
and all taxable periods, or portions thereof, ending on or before, or
including the Distribution Date; and
(d) any state, local or foreign income tax (including any
franchise tax based on income) liabilities (including penalties,
interest and additions to tax) that Company or any of its subsidiaries
is, or may be, liable for as a result of any state, local or foreign
law or regulation similar to Treasury Regulation Section 1.1502-6(a) as
a result of being a member of a combined, unitary or consolidated group
that includes Cardinal or any of its subsidiaries (other than Company
and its subsidiaries) for any and all taxable periods, or portions
thereof, ending on or before, or including, the Distribution Date;
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2. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and assigns.
3. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original but all of which
together will constitute one and the same document.
4. APPLICABLE LAW. This Agreement shall be governed by and construed
in accordance with Ohio law.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the _____ day of _________________, 1997.
CARDINAL REALTY SERVICES, INC.
By:__________________________________
Its:_________________________________
LEXREIT PROPERTIES, INC.
By:__________________________________
Its:_________________________________
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