Tax Returns; Taxes (i) Each of Tidelands and Tidelands Bank has (i) duly and timely filed with the appropriate governmental entity all Tax Returns required to be filed by it (taking into account any applicable extensions), and all such Tax Returns are true, correct and complete in all material respects and prepared in compliance with all applicable laws and (ii) timely paid all Taxes due and owing (whether or not shown due on any Tax Returns). Neither Tidelands nor Tidelands Bank currently is the beneficiary of any extension of time within which to file any Tax Return. To the knowledge of Tidelands, no claim has ever been made by a governmental entity in a jurisdiction where Tidelands and Tidelands Bank do not file Tax Returns that Tidelands or Tidelands Bank is or may be subject to taxation by that jurisdiction. Neither Tidelands nor Tidelands Bank has commenced activities in any jurisdiction which will result in an initial filing of a Tax Return with respect to Taxes imposed by a governmental entity that it had not previously been required to file in the immediately preceding taxable period.
(ii) The unpaid Taxes of Tidelands and Tidelands Bank (A) did not, as of December 31, 2015, exceed the reserve for Tax liabilities (excluding any reserve for deferred Taxes established to reflect timing differences between book and Tax income) set forth on the face of the balance sheets (rather than in any notes thereto) contained in the Tidelands Financial Statements, which were prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Since December 31, 2015, neither Tidelands nor Tidelands Bank has incurred any liability for Taxes outside the ordinary course of business or otherwise inconsistent with past custom and practice.
(iii) There are no liens, charges, restrictions, encumbrances or claims of any kind (collectively, “Liens”) for Taxes upon any property or asset of Tidelands or Tidelands Bank, except for Liens for current Taxes the payment of which is not yet delinquent, or for Taxes contested in good faith through appropriate proceedings and reserved against in accordance with GAAP.
(iv) There are no deficiencies for Taxes with respect to Tidelands and Tidelands Bank that have been set forth or claimed in writing, or, to the knowledge of Tidelands, proposed or assessed by a governmental entity. There are no pending, or, to the knowledge of Tidelands, proposed or threatened audits, investigations, disputes or claims or other actions for or relating to any Tax Return or material liability for Taxes with respect to Tidelands and Tidelands Bank. No material issues relating to Taxes of Tidelands or Tidelands Bank were raised by the relevant governmental entity in any completed audit or examination that would reasonably be expected to recur in a later taxable period. None of Tidelands, Tidelands Bank or any predecessor has waived any statute of limitations in respect of Taxes or agreed to any extension of time with respect to a Tax assessment, deficiency, or collection, or has made any request in writing for any such extension or waiver, that remains in effect. There is not currently in effect any power of attorney authorizing any Person to act on behalf of Tidelands or Tidelands Bank, or receive information relating to Tidelands or Tidelands Bank, with respect to any Tax matter.
(v) Neither Tidelands nor Tidelands Bank has requested or received any ruling from any governmental entity, or signed any binding agreement with any governmental entity (including, without limitation, any advance pricing agreement) that would affect any amount of Tax payable after the Closing Date and has not made any request for issuance of a ruling from a governmental entity on behalf of the Tidelands or Tidelands Bank (regardless of whether the requested ruling is still pending or withdrawn).
(vi) Each of Tidelands and Tidelands Bank has withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, shareholder or other third party, and all Tax Returns (including without limitation all Internal Revenue Service (“IRS”) Forms W-2 and 1099) required with respect thereto have been properly completed and timely filed with, and supplied to, the appropriate parties.
(vii) Except for any customary agreements with customers, vendors, lenders, lessors or the like entered into in the ordinary course of business, neither Tidelands nor Tidelands Bank is a party to or bound by or has any obligation under any Tax sharing, allocation or indemnification agreement or similar contract or arrangement or any agreement that obligates it to make any payment computed by reference to the Taxes, taxable income or taxable losses of any other Person.
(viii) Except for the affiliated group of which Tidelands is the common parent, each of Tidelands and Tidelands Bank is not and has never been a member of an affiliated group of corporations within the meaning of Section 1504 of the Code or any group that has filed a combined, consolidated or unitary Tax Return. Neither Tidelands nor Tidelands Bank is liable for the Taxes of any Person (including an individual, corporation, general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, labor union or other entity or governmental entity) other than Tidelands and Tidelands Bank (i) under Treasury Regulations Section 1.1502-6 (or any similar provision of state, local or foreign law), (ii) as a transferee or successor, (iii) by contract, or (iv) otherwise.
(ix) Neither Tidelands nor Tidelands Bank has constituted either a “distributing corporation” or a “controlled corporation” in a distribution of stock intended to qualify for tax-free treatment under Section 355 or Section 361 of the Code.
(x) Neither Tidelands nor Tidelands Bank has been a party to a “reportable transaction,” as such term is defined in Treasury Regulations Section 1.6011-4(b)(1) (other than such transactions that have been properly reported) or any other substantially similar transaction requiring disclosure under analogous provisions of state, local or foreign Tax law.
(xi) Tidelands has not taken any action not in accordance with past practice that would have the effect of deferring a measure of Tax from a period (or portion thereof) ending on or before the Closing Date to a period (or portion thereof) beginning after the Closing Date. Tidelands has no deferred income or other Tax Liability arising out of any transaction, including, without limitation, any (i) intercompany transaction (as defined in Treasury Regulations Section 1.1502-13), (ii) the disposal of any property in a transaction accounted for under the installment method pursuant to Section 453 of the Code, (iii) excess loss account (as defined in Treasury Regulations Section 1.1502-19) with respect to the stock of any subsidiary of Tidelands, (iv) use of the long-term contract method of accounting, or (v) receipt of any prepaid amount on or before the Closing Date. Neither Tidelands nor Tidelands Bank has made an election under Section 108(i) of the Code (or any corresponding provision of state, local or foreign law).
(xii) Tidelands has delivered or made available to United for inspection complete and correct copies of (i) its federal and state income and franchise Tax Returns and reports for the past three (3) taxable periods ended on or after December 31, 2014, and has indicated those Tax Returns that have been audited and those Tax Returns that are currently the subject of an audit, and (ii) all private letter rulings, revenue agent reports, settlement agreements, a description of all deficiency notices and any similar documents submitted by, received by or agreed to by or on behalf of Tidelands, Tidelands Bank, and any predecessor thereof and relating to Taxes for such taxable periods. Tidelands has delivered or made available to United the amount of any net operating loss, net capital loss, unused investment or other credit, unused foreign tax or excess charitable deduction available for use by Tidelands or Tidelands Bank. There is currently no limitation on the use of the Tax attributes of Tidelands and Tidelands Bank under Sections 269, 382, 383, 384 or 1502 of the Code (and similar provisions of state, local or foreign Tax law).
(xiii) No closing agreement pursuant to Section 7121 of the Code (or any similar provision of state, local or non-U.S. law) has been entered into by or with respect to the Tidelands or Tidelands Bank.
Tax Returns Except as set forth on Schedule 3.6,
(a) As of the Closing Date, the Seller has duly, timely and accurately filed or caused to be duly, timely, and accurately filed with the appropriate taxing jurisdictions, all Federal, state, local and foreign Tax Returns required to be filed, has timely paid or caused to be timely paid all Taxes as shown on such returns or on any assessment received by it to the extent that such Taxes have become due. All Tax Returns were correct and complete in all respects. The Seller is not the beneficiary of any extension of time within which to file any Tax Return. The Seller has not waived any statute of limitation in respect of Taxes or agreed to any extension of time with respect to a Tax assessment or penalty.
(b) No audits or other administrative or court proceedings are pending or proposed with respect to the Seller that relate to Taxes. The Seller has never been a party to any audit, administrative or court proceeding that relate to Taxes.
(c) No claim or assessment has been made by any taxing authority for unpaid Taxes against the Seller. There are no Tax Liens upon the assets of Seller, except for any Liens for personal property taxes not yet due and payable.
(d) All Taxes due and payable by Seller on or before the Closing Date, for which neither filing of Tax Returns nor notice of deficiency or assessment is required, have been paid.
(e) The Seller is not a party to or bound by (nor will it become a party to or bound by) any Tax indemnity, Tax sharing, or Tax allocation agreement of any kind. There are not outstanding powers of attorney executed on behalf of the Seller.
(f) The Seller has never been a member of an affiliated group of corporations within the meaning of IRC Section 1504.
(g) The Seller has not filed a consent pursuant to the collapsible corporation provisions of IRC Section 341(f) (or any corresponding provision of state or local law) or agreed to have IRC Section 341(f)(2) (or any corresponding provisions of state or local law) apply to any disposition of any asset owned by the Seller.
(h) The Seller has not agreed to make nor is it required to make any adjustment under IRC Section 481(a) by reason of a change in accounting method or otherwise.
(i) The Seller is not nor has ever been a United States real property holding company within the meaning of IRC Section 897.
(j) There is no contract, agreement, plan, or arrangement covering any employee or former employee of the Seller that, individually or collectively, would give rise to a payment that would not be deductible by reason of IRC Section 280G.
(k) Adequate accruals for Taxes have been made on the books of the Seller that will be reflected in the Seller's Financial Statements.
(l) All Taxes required to be withheld by or on behalf of the Seller or with respect to the business or assets thereof have been withheld, and such withheld taxes have either been duly and timely paid to the proper Governmental Authorities or set aside in accounts for such purpose or accrued, reserved against and entered upon the books of the Seller. Notwithstanding anything to the contrary contained above, adjustments in claimed Net Operating Loss amounts that do not result in an adverse cash impact on the Seller shall not constitute a breach of any representation made in this Section 3.6.
Pre-Closing Tax Returns From and after the Closing, Peabody shall prepare or cause to be prepared all Tax returns required to be filed by the Peabody Transferred Subsidiaries or, other than Tax returns related to Income Taxes, with respect to the Peabody Contributed Assets for any Pre-Closing Tax Period (the “Peabody Prepared Returns”), and Arch shall prepare or cause to be prepared all Tax returns required to be filed by the Arch Transferred Subsidiaries or, other than Tax returns related to Income Taxes, with respect to the Arch Contributed Assets for any Pre-Closing Tax Period (the “Arch Prepared Returns”). Except as otherwise required by applicable Law, each of Peabody and Arch shall prepare such Tax returns in accordance with past practice. Peabody and Arch shall each deliver to the JV Company all Peabody Prepared Returns and Arch Prepared Returns, together with all supporting documentation, no later than ten days prior to the due date for filing such Tax return, and, if any Peabody Prepared Return or any Arch Prepared Return would reasonably be expected to result in or otherwise affect material Taxes of any JV Entity in any Post-Closing Taxable Period, Peabody or Arch, as the case may be, shall also deliver such Tax return, together with all supporting documentation to Arch or Peabody, as the case may be, no later than ten days prior to the due date for filing such Tax return, for review and reasonable comment by the JV Company and Arch or Peabody, as the case may be, and the party filing such Tax return shall incorporate any reasonable comments received no later than five days prior to the due date for filing such Tax return. Peabody and Arch shall use commercially reasonable efforts to determine which of Peabody, Arch or the JV Company shall file such Tax return. If after complying with the immediately preceding sentence in good faith, Peabody and Arch are unable to agree on which of Peabody, Arch or the JV Company is responsible for filing such Tax return, then the JV Company shall be responsible for filing such Tax return. If the JV Company files any Tax return pursuant to this Section 6.21(a)(i) and if such Tax return shows Taxes as due and owing, Peabody or Arch, as applicable, shall pay the amount of Contributor Taxes with respect to such Tax return to the JV Company no later than the due date for filing such Tax return and the JV Company shall remit such Taxes to the applicable Governmental Authority. If either Peabody or Arch files any Tax return pursuant to this Section 6.21(a)(i), such Tax return shows Taxes as due and owing, and such Taxes were specifically included in Peabody Net Working Capital or Arch Net Working Capital, as the case may be, as finally determined pursuant to Section 3.5(c), then the JV Company shall pay the amount of such identified Taxes to Peabody or Arch no later than the due date for filing such Tax return and Peabody or Arch, as the case may be, shall remit such Taxes to the applicable Governmental Authority.