SOURCE: Building Materials Holding Corporation

Building Materials Holding Corporation

October 01, 2009 17:56 ET

BMHC Obtains Commitment for Exit Financing

Files Amended Plan of Reorganization and Disclosure Statement

Company Positioned to Complete Balance Sheet Restructuring by Year-End

BOISE, ID--(Marketwire - October 1, 2009) - Building Materials Holding Corporation, a leading provider of building materials and construction services to professional residential builders and contractors, today announced that it has secured a commitment for $83.5 million of exit financing that will be available to the Company upon its emergence from Chapter 11 to help meet its operating needs and grow its business. The agreement includes an option to expand the facility by up to $20 million, for a total of $103.5 million, subject to certain conditions. The facility will be provided by a group of lenders led by Wells Fargo. BMHC expects to emerge from Chapter 11 before the end of the year.

BMHC also announced that it has filed an Amended Disclosure Statement and Plan of Reorganization with the U.S. Bankruptcy Court in Wilmington, Delaware. The amended plan, which is subject to Court approval, provides for BMHC's secured lenders to convert debt into equity, becoming majority owners of the Company upon emergence. The proposed treatment of other creditor classes, including general unsecured creditors, is described in the amended Disclosure Statement.

"We are very pleased to have obtained a commitment for exit financing, which is an important step in preparing the Company for emergence and keeps us on track to complete our balance sheet restructuring before year-end," said Robert E. Mellor, Chairman and Chief Executive Officer. "The restructuring will reduce our debt substantially and provide us with greater financial flexibility, putting our Company in a stronger position for the future. We look forward to completing the remaining steps in this process, while continuing to provide our customers and business partners with the high level of quality and service they know they can expect from BMHC."

As previously announced, on June 16, 2009, BMHC and all of its subsidiaries voluntarily initiated reorganization cases in Delaware under Chapter 11 of the U.S. Bankruptcy Code. A hearing at which the Company will seek Court approval of its Amended Disclosure Statement has been scheduled for October 7, 2009. Pursuant to the bankruptcy plan, BMHC's existing common shares held by shareholders will be extinguished and these shareholders will not receive any distributions.

This press release is available on the Company's website at www.bmhc.com, along with additional information on the restructuring.

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 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 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 shares held by shareholders will be extinguished
    under our proposed plan of reorganization and these shareholders will not
    receive any distributions;
--  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;
--  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:

--  our existing common shares held by shareholders will be extinguished
    under our proposed plan of reorganization and these shareholders will not
    receive any distributions;
--  price for our shares may fluctuate significantly;
--  our shares may be less attractive as they are only traded on the "pink
    sheets" and are not traded on a large, more well-known exchange nor on the
    OTC Bulletin Board; 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 the impact of our restructuring initiatives, the approval of our plan of reorganization and our emergence from bankruptcy 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 obtain approval of our plan of reorganization from the bankruptcy court and emerge from bankruptcy. 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.

Contact Information

  • For More Information:
    Bill Smartt
    Senior Vice President and Chief Financial Officer
    +1.415.627.9100

    Mark Kailer
    Vice President, Treasurer and Investor Relations Officer
    +1.415.627.9100

    Lisa Laukkanen
    The Blueshirt Group for BMHC
    +1.415.217.4967