Common use of Tax Returns and Other Tax Matters Clause in Contracts

Tax Returns and Other Tax Matters. (i) 1st Financial and Mountain 1st have timely filed or caused to be filed all federal, state, and local tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, and local income, profits, franchise, sales, use, occupation, property, excise, and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st Financial, Mountain 1st or their property have been fully paid, or if not yet due, a reserve or accrual, which is adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, is reflected in the 1st Financial Interim Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial and Mountain 1st have not been subjected to audit by the Internal Revenue Service (the “IRS”) or the North Carolina Department of Revenue and neither 1st Financial nor Mountain 1st has received any indication of the pendency of any audit or examination in connection with any tax return or report and, to the Best Knowledge of 1st Financial, no such return or report is subject to adjustment; and (iv) neither 1st Financial nor Mountain 1st executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial Each of FNB and Mountain 1st have its subsidiaries has timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialFNB, Mountain 1st its subsidiaries or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of FNB to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim FNB Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial FNB and Mountain 1st its subsidiaries have not been subjected subject to audit by the Internal Revenue Service (the “IRS”) IRS or the North Carolina Department of Revenue in the last seven years and neither 1st Financial FNB nor Mountain 1st any of its subsidiaries has received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial FNB nor Mountain 1st any of its subsidiaries has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial AB&T and Mountain 1st Alliance have timely filed or caused to be filed all federal, state, and local tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, and local income, profits, franchise, sales, use, occupation, property, excise, and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialAB&T, Mountain 1st Alliance or their property have been fully paid, or if not yet due, a reserve or accrual, which is adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, is reflected in the 1st Financial AB&T Interim Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial AB&T and Mountain 1st Alliance have not been subjected to audit by the Internal Revenue Service (the “IRS”) or the North Carolina Department of Revenue or any other taxing authority and neither 1st Financial AB&T nor Mountain 1st Alliance has received any indication of the pendency of any audit or examination in connection with any tax return or report and, to the Best Knowledge of 1st FinancialAB&T, no such return or report is subject to adjustment; and (iv) neither 1st Financial AB&T nor Mountain 1st Alliance executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax. The aggregate unpaid taxes of AB&T and Alliance (i) did not, as of the most recent fiscal quarter end, exceed, in any material respect, the reserve for tax liability (as opposed to any reserve for deferred taxes established to reflect timing differences between book and tax income) set forth on the face of the most recent balance sheet delivered to 1st Financial (as opposed to in any notes thereto) and (ii) do not exceed, in any material respect, that reserve as adjusted for the passage of time through the Closing Date in accordance with the past custom and practice of AB&T and Alliance in filing their Tax Returns. Since the date of the most recent balance sheet delivered to 1st Financial, neither AB&T nor Alliance has incurred any liability for taxes arising from extraordinary gains or losses, as that term is used in GAAP, outside the ordinary course of business consistent with past custom and practice.

Tax Returns and Other Tax Matters. (i) 1st Financial and Mountain 1st have Bancorp has timely filed or caused to be filed all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st Financial, Mountain 1st Bancorp or their property its properties have been fully paidpaid or, or if not yet due, a reserve or accrual, which is adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, is reflected in on the 1st Financial Bancorp Interim Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial and Mountain 1st Bancorp have not been subjected to audit by the Internal Revenue Service (the “IRS”) IRS or the North Carolina Department of Revenue in the last six (6) years and neither 1st Financial nor Mountain 1st Bancorp has not received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, and no such return or report is subject to adjustment; and (iv) neither 1st Financial nor Mountain 1st Bancorp has not executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any such tax return or report report, or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial Integrity and Mountain 1st have each of its subsidiaries has timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialIntegrity, Mountain 1st any subsidiary or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of Integrity to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim Integrity Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial Integrity and Mountain 1st its subsidiaries have not been subjected subject to audit by the Internal Revenue Service (the “IRS”) or the North Carolina Department of Revenue in the last seven years and neither 1st Financial Integrity nor Mountain 1st any subsidiary has received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial Integrity nor Mountain 1st any subsidiary has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax yeartax; (v) no closing agreements, private letter rulings, technical advice memoranda or similar agreements or rulings have been entered into or issued by any governmental authority with respect to Integrity and its subsidiaries; (vi) neither Integrity nor any of its subsidiaries maintains any compensation plans, programs or arrangements the audit payments under which would not reasonably be expected to be deductible as a result of the limitations under Section 162(m) of the Code and the regulations issued thereunder; (vii) neither Integrity nor any tax return of its subsidiaries (A) has agreed, or report is required, to make any adjustment under Section 481(a) of the Code or any comparable provision of state, local or foreign law or has any knowledge that a governmental authority has proposed any such adjustment or change in accounting method with respect to Integrity or its subsidiaries or (B) has any application pending with any governmental authority requesting permission for any change in accounting method; and (viii) neither Integrity nor any of its subsidiaries is required to include any item of income in, or exclude any item of deduction or loss from, taxable income for any taxable period or portion thereof beginning on or after the assessment Closing Date as a result of (A) a change in method of accounting for a taxable period beginning prior to the Closing Date, (B) any “closing agreement,” as described in Section 71 of the Code, or collection any corresponding provision of state, local or foreign law, executed on or before the Closing Date, (C) any taxsale reported on the installment method where such sale occurred on or prior to the Closing Date, (D) any prepaid amount received by Integrity or any of its subsidiaries on or prior to the Closing Date of (E) any intercompany transactions or excess loss account described in Treasury Regulations under Section 1502 of the Code or any corresponding provision of state, local or foreign law.

Tax Returns and Other Tax Matters. (i) 1st Financial FNB and Mountain 1st First National have timely filed or caused to be filed all federal, state, and local tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financialmanagement of FNB, all such returns and reports were true, correct, and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, and local income, profits, franchise, sales, use, occupation, property, excise, and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialFNB, Mountain 1st First National or their property have been fully paid, or if not yet due, a reserve or accrual, which is adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, is reflected in the 1st Financial FNB Interim Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial FNB and Mountain 1st First National have not been subjected to audit by the Internal Revenue Service (the “IRS”) or the North South Carolina Department of Revenue and neither 1st Financial FNB nor Mountain 1st First National has received any indication of the pendency of any audit or examination in connection with any tax return or report and, to the Best Knowledge of 1st Financialmanagement of FNB, no such return or report is subject to adjustment; and (iv) neither 1st Financial FNB nor Mountain 1st First National executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial ACB and Mountain 1st American have timely filed or caused to be filed all federal, state, and local tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financialmanagement of ACB, all such returns and reports were true, correct, and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, and local income, profits, franchise, sales, use, occupation, property, excise, and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialACB, Mountain 1st American or their property have been fully paid, or if not yet due, a reserve or accrual, which is adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, is reflected in the 1st Financial ACB Interim Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial ACB and Mountain 1st American have not been subjected to audit by the Internal Revenue Service (the “IRS”) or the North Carolina Department of Revenue and neither 1st Financial ACB nor Mountain 1st American has received any indication of the pendency of any audit or examination in connection with any tax return or report and, to the Best Knowledge of 1st Financialmanagement of ACB, no such return or report is subject to adjustment; and (iv) neither 1st Financial ACB nor Mountain 1st American executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial and Mountain 1st have Mutual has timely filed or caused to be filed all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st Financial, Mountain 1st Mutual or their property its properties have been fully paidpaid or, or if not yet due, a reserve or accrual, which is adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, is reflected in on the 1st Financial Mutual Interim Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial and Mountain 1st Mutual have not been subjected to audit by the Internal Revenue Service (the “IRS”) or the North Carolina Department of Revenue in the last six (6) years and neither 1st Financial nor Mountain 1st Mutual has not received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, and no such return or report is subject to adjustment; and (iv) neither 1st Financial nor Mountain 1st Mutual has not executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any such tax return or report report, or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial Each of United and Mountain 1st have its subsidiaries has timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialUnited, Mountain 1st any subsidiary or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of United to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim United Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial United and Mountain 1st its subsidiaries have not been subjected subject to audit by the Internal Revenue Service (the “IRS”) or the North Carolina Department of Revenue in the last seven years and neither 1st Financial United nor Mountain 1st any subsidiary has received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial United nor Mountain 1st any subsidiary has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st HC Financial and Mountain 1st High Country --------------------------------- have timely filed or caused to be filed all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st Financial, Mountain 1st HC Financial and High Country or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, which is adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, is reflected in on the 1st Financial High Country Interim Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st HC Financial and Mountain 1st High Country have not been subjected to audit by the Internal Revenue Service (the “"IRS”") or the North Carolina Department of Revenue Revenue, and neither 1st HC Financial nor Mountain 1st has and High Country have not received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financialmanagement of HC Financial and High Country, no such return or report is subject to adjustment; and (iv) neither 1st HC Financial nor Mountain 1st and High Country have not executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any such tax return or report report, or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial and Mountain 1st have BHS has timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialBHS, Mountain 1st or their property its respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of BHS to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim BHS Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial and Mountain 1st BHS have not been subjected subject to audit by the Internal Revenue Service (the “IRS”) or the North South Carolina Department of Revenue since December 31, 2000 and neither 1st Financial nor Mountain 1st BHS has not received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial nor Mountain 1st BHS has not executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial Each of UCB and Mountain 1st have its subsidiaries has timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialUCB, Mountain 1st its subsidiaries or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of UCB to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim UCB Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial UCB and Mountain 1st its subsidiaries have not been subjected subject to audit by the Internal Revenue Service (the “IRS”) IRS or the North Carolina Department of Revenue in the last seven years and neither 1st Financial UCB nor Mountain 1st any of its subsidiaries has received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial UCB nor Mountain 1st any of its subsidiaries has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial and Mountain 1st have SSB has timely filed or caused to be filed all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st Financial, Mountain 1st SSB or their property its properties have been fully paidpaid or, or if not yet due, a reserve or accrual, which is adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, is reflected in on the 1st Financial SSB Interim Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial and Mountain 1st SSB have not been subjected to audit by the Internal Revenue Service (the “IRS”) or the North Carolina Department of Revenue in the last ten years and neither 1st Financial nor Mountain 1st SSB has not received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, and no such return or report is subject to adjustment; and (iv) neither 1st Financial nor Mountain 1st SSB has not executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any such tax return or report report, or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (iI) 1st Financial First Savings and Mountain 1st have FSB each --------------------------------- has timely filed or caused to be filed all federal, state, state and local income tax returns and reports which are required by law to have been filed, and and, to the Best Knowledge of 1st Financialmanagement of First Savings, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (iiII) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st Financial, Mountain 1st First Savings or FSB or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim First Savings Financial Statements; (iiiIII) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial First Savings and Mountain 1st FSB have not been subjected to audit by the Internal Revenue Service (the “"IRS”") or the Department of Tax and Revenue of the State of North Carolina Department of Revenue in the last ten years and neither 1st Financial First Savings nor Mountain 1st FSB has received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financialmanagement of First Savings and FSB, no such return or report is subject to adjustment; and (ivIV) neither 1st Financial First Savings nor Mountain 1st FSB has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitationslimitation) with respect to any tax year, the audit of any such tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial and Mountain 1st have Centennial has timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialCentennial, Mountain 1st or their property its respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of Centennial to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim Centennial Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial and Mountain 1st Centennial have not been subjected subject to audit by the Internal Revenue Service (the “"IRS”") or the North Carolina Department of Revenue since its incorporation and neither 1st Financial nor Mountain 1st Centennial has not received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial nor Mountain 1st Centennial has not executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial Each of Community and Mountain 1st have its subsidiaries has timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialCommunity, Mountain 1st its subsidiaries or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of Community to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim Community Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial Community and Mountain 1st its subsidiaries have not been subjected subject to audit by the Internal Revenue Service (the “"IRS”") or the North Carolina Department of Revenue in the last seven years and neither 1st Financial Community nor Mountain 1st its subsidiaries has received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial Community nor Mountain 1st its subsidiaries has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial Main Street and Mountain 1st Piedmont have timely filed or caused to be filed all federal, state, state and local income tax returns and reports which are required by law to have been filed, and and, to the Best Knowledge of 1st Financialmanagement of Main Street and Piedmont, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st Financial, Mountain 1st Main Street and Piedmont or their property its respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, which is adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, is reflected in on the 1st Financial Piedmont Interim Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial Main Street and Mountain 1st Piedmont have not been subjected to audit by the Internal Revenue Service (the “"IRS”") or the North Carolina Department of Revenue in the last seven (7) years and neither 1st Financial nor Mountain 1st has Main Street and Piedmont have not received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financialmanagement of Main Street and Piedmont, no such return or report is subject to adjustment; and (iv) neither 1st Financial nor Mountain 1st Main Street and Piedmont have not executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any such tax return or report report, or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial Each of Rowan and Mountain 1st have Rowan Bank --------------------------------- has timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialXxxxx, Mountain 1st Xxxxx Bank or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of Rowan to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim Rowan Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial Rowan and Mountain 1st its subsidiary have not been subjected subject to audit by the Internal Revenue Service (the “"IRS”") or the North Carolina Department of Revenue in the last seven years and neither 1st Financial Rowan nor Mountain 1st Rowan Bank has received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial Rowan nor Mountain 1st Rowan Bank has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. To the best knowledge of management of PSB, (i) 1st Financial and Mountain 1st have PSB has timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialPSB, Mountain 1st or their property its respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of PSB to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim PSB Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial and Mountain 1st PSB have not been subjected subject to audit by the Internal Revenue Service (the “IRS”) or the North Carolina Department of Revenue since December 31, 2000 and neither 1st Financial nor Mountain 1st PSB has not received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial nor Mountain 1st PSB has not executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial Twentieth Bancorp and Mountain 1st the Bank have timely filed or caused to be filed all federal, state, state and local tax returns and reports which are required by law to have been filed, and and, to the Best Knowledge best knowledge and belief of 1st Financialmanagement of Twentieth Bancorp, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profitsbusiness and occupation, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st Financial, Mountain 1st Twentieth Bancorp or the Bank or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim Twentieth Bancorp Financial Statements; (iii) except as set forth in Twentieth Bancorp's Disclosure Statement, the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial Twentieth Bancorp and Mountain 1st the Bank have not been subjected subject to audit by the Internal Revenue Service (the “"IRS”") or the North Carolina Department of Tax and Revenue of the State of West Virginia in the last ten (10) years and neither 1st Financial Twentieth Bancorp nor Mountain 1st the Bank has received any indication of the pendency of any audit or examination in connection with any tax return or report and, to the Best Knowledge of 1st Financial, and have no knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial nor Mountain 1st Twentieth Bancorp or the Bank has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitationslimitation) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial Catawba and Mountain 1st Bancshares have --------------------------------- timely filed or caused to be filed all federal, state, and local tax returns and reports which are required by law to have been filed, and to the Best Knowledge best knowledge of 1st Financialmanagement of Catawba and Bancshares, all such returns and reports were true, correct, and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, and local income, profits, franchise, sales, use, occupation, property, excise, and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st Financial, Mountain 1st Catawba or Bancshares or their respective property have been fully paid, and, to the best knowledge of management of Catawba and Bancshares, with respect to any such taxes to become due from Catawba or if not yet dueBancshares for any period or periods through and including March 31, a reserve or accrual2001, which is adequate in all material respects provision has been made for the payment of all such taxes to be paid and the obligation for such unpaid taxes, provision is reflected in the 1st Financial Interim Catawba Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment Catawba and other tax returns and reports of 1st Financial and Mountain 1st Bancshares have not been subjected to audit by the Internal Revenue Service (the “IRS”) or the North Carolina Department of Revenue and neither 1st Financial nor Mountain 1st has received any indication of the pendency of any audit or examination in connection with any tax return or report and, to the Best Knowledge of 1st Financial, and have no knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial nor Mountain 1st Catawba and Bancshares have not executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitationslimitation) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax. Any deferred taxes of Catawba or Bancshares have been provided for in the Catawba Financial Statements in all material respects.

Tax Returns and Other Tax Matters. (i) 1st Financial Each of FNB and Mountain 1st have its subsidiary --------------------------------- has timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialFNB, Mountain 1st its subsidiary or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of FNB to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim FNB Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial FNB and Mountain 1st its subsidiary have not been subjected subject to audit by the Internal Revenue Service (the “"IRS”") or the North Carolina Department of Revenue in the last seven years and neither 1st Financial FNB nor Mountain 1st its subsidiary has received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial FNB nor Mountain 1st its subsidiary has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial Each of Carolina and Mountain 1st have its subsidiaries has timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialCarolina, Mountain 1st any subsidiary or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of Carolina to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim Carolina Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial Carolina and Mountain 1st its subsidiaries have not been subjected subject to audit by the Internal Revenue Service (the “"IRS”") or the North Carolina Department of Revenue in the last seven years and neither 1st Financial Carolina nor Mountain 1st any subsidiary has received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial Carolina nor Mountain 1st any subsidiary has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial Each of FNB and Mountain 1st have its --------------------------------- subsidiarieshas timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialFNB, Mountain 1st its subsidiaries or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of FNB to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim FNB Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial FNB and Mountain 1st its subsidiaries have not been subjected subject to audit by the Internal Revenue Service (the “"IRS”") or the North Carolina Department of Revenue in the last seven years and neither 1st Financial FNB nor Mountain 1st any of its subsidiaries has received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial FNB nor Mountain 1st any of its subsidiaries has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Each of Crescent Financial and Mountain 1st have Crescent has timely filed or caused to be filed filed, or obtained proper extensions of time for filing, all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st Crescent Financial, Mountain 1st Crescent or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is reasonably believed by the management of Crescent Financial to be adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim Crescent Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Crescent Financial and Mountain 1st Crescent have not been subjected subject to audit by the Internal Revenue Service (the “IRS”) IRS or the North Carolina Department of Revenue since incorporation and neither 1st Crescent Financial nor Mountain 1st Crescent has received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, no or has any knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Crescent Financial nor Mountain 1st Crescent has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitations) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.

Tax Returns and Other Tax Matters. (i) 1st Financial Each of Home Savings and Mountain 1st have the Subsidiary has timely filed or caused to be filed all federal, state, state and local income tax returns and reports which are required by law to have been filed, and to the Best Knowledge of 1st Financial, all such returns and reports were true, correct, correct and complete in all material respects and contained all material information required to be contained therein; (ii) all federal, state, state and local income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other taxes (including interest and penalties), charges and assessments which have become due from or been assessed or levied against 1st FinancialHome Savings, Mountain 1st the Subsidiary or their property respective properties have been fully paidpaid or, or if not yet due, a reserve or accrual, accrual which is adequate in all material respects for the payment of all such taxes to be paid and the obligation for such unpaid taxes, taxes is reflected in on the 1st Financial Interim Home Savings Financial Statements; (iii) the income, profits, franchise, sales, use, occupation, property, excise, withholding, employment and other tax returns and reports of 1st Financial Home Savings and Mountain 1st the Subsidiary have not been subjected subject to audit by the Internal Revenue Service (the “"IRS”") or the North Carolina Department of Revenue in the last ten years and neither 1st Financial Home Savings nor Mountain 1st the Subsidiary has received any indication of the pendency of any audit or examination in connection with any such tax return or report and, to the Best Knowledge of 1st Financial, and have no knowledge that any such return or report is subject to adjustment; and (iv) neither 1st Financial Home Savings nor Mountain 1st the Subsidiary has executed any waiver or extended the statute of limitations (or been asked to execute a waiver or extend a statute of limitationslimitation) with respect to any tax year, the audit of any tax return or report or the assessment or collection of any tax.