BMHC Reaches Agreement With Secured Lender Group on Plan to Restructure Balance Sheet

BMHC Reaches Agreement With Secured Lender Group on Plan to Restructure
Balance Sheet

To Implement Pre-Negotiated Plan, Company Initiates Chapter 11 Reorganization
Proceedings

Receives Commitments for $80 Million in DIP Financing

BOISE, Idaho, June 16 /PRNewswire-FirstCall/ -- 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 reached agreement with members of its
secured lender group on a plan to restructure the Company's balance sheet and
provide greater financial flexibility to support its long-term business plan.
Under the proposed restructuring plan, BMHC will significantly reduce its
outstanding funded debt, establish a new revolving credit facility, and
substantially lower annual interest expense upon consummation of the plan.

In order to implement this "pre-negotiated" restructuring plan in an efficient
and timely manner, the Company and all of its subsidiaries have voluntarily
initiated reorganization proceedings under Chapter 11 of the U.S. Bankruptcy
Code in Delaware and have filed a plan of reorganization to implement the
restructuring.

BMHC plans to continue to operate as usual while it restructures its balance
sheet and will honor all of its commitments to customers. All of the Company's
locations are open today and are continuing to serve customers in the normal
course.

The Company has received commitments for $80 million in debtor-in-possession
(DIP) financing from Wells Fargo Bank and certain of its other existing
lenders. Of this amount, $40 million will be immediately available to the
Company upon interim Court approval, representing an incremental increase in
availability of $20 million from the Company's current $20 million revolver,
with the full $80 million accessible to the Company upon final Court approval.
The Company expects the new financing to provide ample liquidity to meet its
ongoing obligations to employees, customers and suppliers.

Robert E. Mellor, Chairman and Chief Executive Officer, said, "We are very
pleased to have reached agreement with representatives of our bank group on a
plan that will put our Company in a stronger financial position for the
future. Their support, and the fact that our new financing is coming from
existing lenders, is a sign that our business partners have confidence in our
strength as a company and our long-term potential. BMHC is an industry leader
with a strong market niche and well-recognized brands. We pride ourselves on
the quality of our products and services, and our customers should know that
this will not change while we undergo this restructuring.

"The restructuring will provide us with increased liquidity to navigate the
current market challenges while creating a capital structure that will better
support our long-term growth objectives. Importantly, this agreement caps a
series of actions we have taken to aggressively respond during this
unprecedented housing downturn. By lowering costs, aligning our expense
structure with reduced demand and selectively scaling back our presence in
non-core markets where the prospect of recovery is years away, we have made
BMHC a leaner, more competitive company. Coupled with a healthier capital
structure, these actions will put us in a solid position to capitalize on
opportunities when macroeconomic and market conditions improve. We appreciate
the support of our bank group and look forward to completing this process as
expeditiously as possible."

The Company today filed a proposed Disclosure Statement and Plan of
Reorganization with the court. Under the proposed plan, the Company's existing
secured lenders will convert their interests into equity in the newly
reorganized company and will receive interests in $135 million in newly issued
long-term notes. The Company's unsecured creditors will receive a cash
distribution and the right to receive future payments based upon the
performance of the Company. The Company's existing equity will be
extinguished, and current equity holders will not receive any distributions.
The Company anticipates completing the restructuring process in three to four
months.

BMHC has filed customary "First Day" motions to support its employees,
customers and suppliers during the reorganization process, including motions
to allow the Company to continue to pay its employees in the usual manner and
to continue without disruption their medical, dental, life insurance,
disability and other benefits. The Company does not plan to close any of its
facilities or reduce employment levels as a direct result of the filing,
though, as always, it will continue to monitor market conditions and make
adjustments in its business as necessary. Suppliers will be paid under normal
terms for goods and services provided after the filing date of June 16, 2009.
Payment for goods and services provided prior to the filing date will be
addressed through the Chapter 11 process.

Additional information on the restructuring is available on the Company's
website at www.bmhc.com.

The Company's legal advisor is Gibson, Dunn & Crutcher, its financial advisor
is Peter J. Solomon Company, and its restructuring advisor is Alvarez &
Marsal.

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 across the
country. 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 II Item 1A of our most recent
Form 10-Q. These risks and uncertainties may include, however are not limited
to:

-- substantial doubt about our ability to continue as a going concern;
-- our existing common equity may have no value;
-- demand for and supply of single-family homes which are 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 liquidity is dependent on operating performance, an efficient cash
conversion cycle and compliance with financial covenants;
-- our ability to implement and maintain cost structures that align with
sales trends and
-- losses of customers as well as changes in the business models of our
customers may limit our ability to provide building products and
construction services;
-- 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 our
restructuring initiatives and cost cutting efforts, our liquidity and
negotiations with our lenders 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 our ability to timely and successfully implement our restructuring
program and achieve the benefits that the program is designed to provide,
including preserving value, enhancing our liquidity, generating tax refunds,
reducing expenses and generating cash proceeds. 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

Bill Smartt, Senior Vice President and Chief Financial Officer, or Mark
Kailer, Vice President, Treasurer and Investor Relations Officer, both of
Building Materials Holding Corporation, +1-415-627-9100; or Lisa Laukkanen of
The Blueshirt Group, +1-415-217-4967, lisa@blueshirtgroup.com, for Building
Materials Holding Corporation