PAID IN FULL AND THE COMMITMENTS HAVE
TERMINATED, THE ADMINISTRATIVE AGENT WILL, AT THE GUARANTOR'S REQUEST, EXECUTE
AND DELIVER TO THE GUARANTOR APPROPRIATE DOCUMENTS, WITHOUT RECOURSE AND WITHOUT
REPRESENTATION OR WARRANTY OF ANY KIND WHATSOEVER, NECESSARY TO EVIDENCE THE
TRANSFER BY SUBROGATION TO THE GUARANTOR OF ANY INTEREST IN THE GUARANTY
OBLIGATIONS RESULTING FROM SUCH PAYMENT BY THE GUARANTOR. THE GUARANTOR HEREBY
AGREES THAT IT SHALL HAVE NO RIGHTS OF SUBROGATION WITH RESPECT TO AMOUNTS DUE
TO THE ADMINISTRATIVE AGENT OR THE LENDERS UNTIL SUCH TIME AS ALL OBLIGATIONS OF
BLFC TO THE LENDERS AND THE ADMINISTRATIVE AGENT HAVE BEEN PAID IN FULL, THE
COMMITMENTS HAVE BEEN TERMINATED AND THE CREDIT AGREEMENT HAS BEEN TERMINATED.
SECTION 7.
REPRESENTATIONS AND WARRANTIES. THE GUARANTOR
HEREBY REPRESENTS AND WARRANTS AS FOLLOWS:
(A)
FINANCIAL CONDITION.
(I)
THE CONSOLIDATED BALANCE SHEET OF THE
GUARANTOR AND ITS CONSOLIDATED SUBSIDIARIES AS AT DECEMBER 31, 2004 AND THE
RELATED CONSOLIDATED STATEMENTS OF INCOME FOR THE FISCAL YEAR ENDED ON SUCH
DATE, REPORTED ON BY THE GUARANTOR'S INDEPENDENT PUBLIC ACCOUNTANTS, COPIES OF
WHICH HAVE HERETOFORE BEEN FURNISHED TO THE ADMINISTRATIVE AGENT, ARE COMPLETE
AND CORRECT, IN ALL MATERIAL RESPECTS, AND PRESENT FAIRLY THE FINANCIAL
CONDITION OF THE GUARANTOR AND ITS CONSOLIDATED SUBSIDIARIES AS AT SUCH DATE,
AND THE RESULTS OF OPERATIONS FOR THE FISCAL YEAR THEN ENDED. SUCH FINANCIAL
STATEMENTS, INCLUDING ANY RELATED SCHEDULES AND NOTES THERETO, HAVE BEEN
PREPARED IN ACCORDANCE WITH GAAP APPLIED CONSISTENTLY THROUGHOUT THE PERIODS
INVOLVED (EXCEPT AS APPROVED BY THE EXTERNAL AUDITORS AND AS DISCLOSED THEREIN,
IF ANY).
(II)
EXCEPT AS DISCLOSED IN SCHEDULE VI
ATTACHED HERETO, NEITHER THE GUARANTOR NOR ITS CONSOLIDATED SUBSIDIARIES HAD, AT
THE DATE OF THE MOST RECENT BALANCE SHEET REFERRED TO ABOVE, ANY MATERIAL
GUARANTEE OBLIGATION, CONTINGENT LIABILITY (AS DEFINED IN ACCORDANCE WITH GAAP),
OR ANY LONG-TERM LEASE OR UNUSUAL FORWARD OR LONG-TERM COMMITMENT, INCLUDING,
WITHOUT LIMITATION, ANY INTEREST RATE OR FOREIGN CURRENCY SWAP OR EXCHANGE
TRANSACTION, WHICH IS NOT REFLECTED IN THE FOREGOING STATEMENTS OR IN THE NOTES
THERETO, EXCEPT FOR GUARANTEES, INDEMNITIES OR SIMILAR OBLIGATIONS OF THE
GUARANTOR OR CONSOLIDATED SUBSIDIARY SUPPORTING OBLIGATIONS OF ONE SUBSIDIARY TO
ANOTHER SUBSIDIARY.
(III)
DURING THE PERIOD FROM DECEMBER 31, 2004 TO
AND INCLUDING THE DATE HEREOF, EXCEPT AS DISCLOSED IN SCHEDULE VI ATTACHED
HERETO, NEITHER THE GUARANTOR NOR ITS CONSOLIDATED SUBSIDIARIES HAS SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF ANY MATERIAL PART OF ITS BUSINESS OR
PROPERTY, NOR HAS IT PURCHASED OR OTHERWISE ACQUIRED ANY BUSINESS OR PROPERTY
(INCLUDING ANY CAPITAL STOCK OF ANY OTHER PERSON) MATERIAL IN RELATION TO THE
CONSOLIDATED FINANCIAL
4
CONDITION OF THE GUARANTOR AND ITS CONSOLIDATED SUBSIDIARIES AT DECEMBER 31,
2004.
(B)
NO CHANGE. SINCE DECEMBER 31, 2004, EXCEPT
AS DISCLOSED IN SCHEDULE I HEREOF, THERE HAS BEEN NO DEVELOPMENT OR EVENT WHICH
HAS HAD OR COULD, IN THE GUARANTOR'S GOOD FAITH REASONABLE JUDGMENT, REASONABLY
BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.
(C)
CORPORATE EXISTENCE; COMPLIANCE WITH LAW.
THE GUARANTOR AND EACH OF ITS SUBSIDIARIES (I) IS DULY ORGANIZED AND VALIDLY
EXISTING UNDER THE