BMHC Obtains Lender Authorization To Borrow Up To $20 Million Through June 1, 2009

BOISE, Idaho, April 14, 2009 /PRNewswire-FirstCall via COMTEX/ -- BLGM | Quote | Chart | News | PowerRating -- Building Materials Holding Corporation (OTC Bulletin Board: BLGM), a leading provider of building materials and construction services to professional residential builders and contractors, today announced that it has obtained a revised waiver from its lenders that authorizes the Company to borrow up to $20 million through June 1, 2009.

Robert E. Mellor, Chairman and Chief Executive Officer, said, "We are in discussions with our lenders and appreciate their support. The focus of our discussions is on how to create the best capital structure to move the business forward and support our long-term strategic plan and business objectives. As these negotiations continue, we believe our ability to borrow up to $20 million under our revolver through June 1 should provide us with sufficient liquidity to continue to meet our ongoing business obligations to customers, suppliers and employees as we have always done. Our team remains as committed as ever to serving our customers with the same high quality materials and services they have come to expect from BMHC."

BMHC's credit agreement provides a $200 million revolver subject to borrowing base limitations and a $340 million term note maturing in November 2011. As of April 13, 2009, there were $8.3 million in borrowings outstanding under the revolver and approximately $315 million outstanding under the term note.

As previously reported, BMHC's credit agreement requires monthly compliance with financial covenants including minimum liquidity and adjusted earnings before interest, taxes, depreciation and amortization (monthly Adjusted EBITDA) at least through 2010. Based on financial information for February 2009, the Company was not in compliance with the monthly Adjusted EBITDA requirement of its credit agreement. In March 2009, BMHC obtained a temporary waiver through April 15, 2009 for lack of compliance with this requirement. This waiver has now been extended through June 1. In addition, the lenders have agreed to waive a potential default that would otherwise arise under the current credit agreement if, as expected, BMHC's independent registered public accounting firm includes a going concern explanatory paragraph in their opinion as to the Company's financial statements for the year ended December 31, 2008. The waiver also requires BMHC to proceed with filing of tax returns, development of a business plan and includes a $0.5 million limitation on capital expenditures.

BMHC is in the process of finalizing its financial statements for the fourth quarter and full year 2008 and completing its year-end audit. The Company expects to file its Form 10-K annual report on or before April 15, 2009. BMHC also announced that it has filed its 2008 federal tax return that seeks a refund of approximately $56 million. Any refund obtained will be used by the Company to pay down existing obligations and will help de-lever its capital structure.

About BMHC

BMHC is one of the largest providers of building materials and residential construction services in the United States. We serve the homebuilding industry through two recognized brands: as BMC West, we distribute building materials and manufacture building components for professional builders and contractors in the western and southern states; as SelectBuild, we provide construction services to high-volume production homebuilders in key markets. To learn more about BMHC, visit our website at www.bmhc.com.

BUSINESS RISKS AND FORWARD-LOOKING STATEMENTS

There are a number of business risks and uncertainties that affect our operations and therefore could cause future results to differ from past performance or expected results. Additional information regarding business risks and uncertainties is contained in Part 1 Item 1A of Form 10-K. These risks and uncertainties may include, however are not limited to:

    --  substantial doubt about our ability to continue as a going concern;
    --  demand for and supply of single-family homes which is influenced by
        changes in the overall condition of the U.S. economy, including interest
        rates, consumer confidence, job formation, availability of credit and
        other important factors;
    --  our ability to maintain adequate liquidity, reduce operating costs and
        increase market share in an industry that has experienced and continues
        to experience a significant reduction in average annual housing starts;
    --  our dependence upon operating performance, an efficient cash conversion
        cycle and compliance with financial covenants for our liquidity;
    --  our ability to implement and maintain cost structures that align with
        sales trends;
    --  loss of customers as well as changes in the business models of our
        customers which may limit our ability to provide building products and
        construction services;
    --  additional impairment charges and costs to close or consolidate
        additional business units in underperforming markets;
    --  intense competition;
    --  availability of and our ability to attract, train and retain qualified
        individuals;
    --  fluctuations in our costs and availability of sourcing channels for
        commodity wood products, concrete, steel and other building materials;
    --  weather conditions including natural catastrophic events;
    --  exposure to product liability and construction defect claims as well as
        other legal proceedings;
    --  disruptions in our information systems;
    --  actual and perceived vulnerabilities as a result of widespread credit
        and liquidity concerns, terrorist activities and armed conflict;
    --  costs and/or restrictions associated with federal, state and other
        regulations and
    --  numerous other matters of a local and regional scale, including those of
        a political, economic, business, competitive or regulatory nature.

Risks related to our shares may include, however are not limited to:

    --  price for our shares may fluctuate significantly;
    --  our shares may be less attractive as they are not traded on a large,
        more well-known exchange and
    --  anti-takeover defenses and certain provisions could prevent an
        acquisition of our company or limit share price.

Certain statements in this news release, including those related to expectations about our ability to reach agreement with our lenders on an appropriate amendment to our credit agreement, the ability to continue to borrow under our credit agreement, our anticipated liquidity, the impact on our business operations from any non-compliance with financial covenants, the timing of the filing of our Form 10-K, and the receipt of any tax refunds, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not historical or current facts, including statements about our expectations, anticipated financial results and future business prospects are forward-looking statements. While these statements represent our current judgment on what the future may hold and we believe these judgments are reasonable, these statements involve risks and uncertainties that are important factors that could cause our actual results to differ materially from those in forward-looking statements. These factors include, however are not limited to the risks and uncertainties cited in the above paragraph, as well as the risks that: we may not be able to reach agreement with our lenders with respect to amendments and waivers to our credit agreement on terms acceptable to us and our lenders; our non-compliance with the financial covenant may adversely affect our liquidity and our business; our efforts to maintain preferred supplier status and focus on cost efficiencies may not be sufficient to allow us to weather the downturn in the housing industry; and we may not be able to timely and successfully implement our restructuring program and realignment of our business and achieve the benefits that they are designed to provide. Undue reliance should not be placed on such forward-looking statements, as such statements speak only as of the date of this news release. We undertake no obligation to update forward-looking statements.

SOURCE Building Materials Holding Corporation

http://www.bmhc.com

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