Taiga Building Products Ltd. announces tax reassessment settlement and new dividend policy

BURNABY, BC, October 15, 2008 /CNW/ - Taiga Building Products Ltd. ("Taiga" or the "Company") (TSX: TBL & TBL.NT) announced today that it has settled its provincial income tax reassessment (the "Reassessment") and agreed to pay a total amount of $9.6 Million (the "Settlement Amount"). Taiga refers you to its press releases of May 16, 2007 and May 28, 2008, and other financial disclosure, for further description.

To date, Taiga has already paid $1.8 Million of the Settlement Amount in cash and the balance is expected to be paid by October 30, 2008.

As at March 31, 2008, Taiga had already expensed $8.6 Million of the Settlement Amount in its financial statements and the balance, being $1.0 Million, will be accounted for in the 2nd fiscal Quarter ended September 30, 2008.

The Reassessment was the result of an intra-corporate tax financing structure arranged and sold by Deloitte and Touche, the Company's advisors and auditors at the time. Taiga has launched a lawsuit against Deloitte and Touche for, among other things, breach of contract, breach of fiduciary duty and professional negligence. Taiga is claiming a return of all costs arising from the failed plan including in excess of $725,000 paid as contingency fees. Deloitte and Touche has counterclaimed against Taiga for additional contingency fees. As a result of the inherent uncertainty of litigation, Taiga cannot predict the outcome of such actions.

In connection with the Reassessment settlement, Taiga announces a revised Dividend Policy. Pursuant to the revised policy, the Company intends to pay dividends on its common shares equal to 25% of the prior fiscal year's Net Earnings. This revised policy is designed to link dividends more directly to accomplishment. Taiga will discontinue its current monthly Dividend Payment Policy of $0.015 per share per month. The last payment will be on October 15, 2008 for the month ended September 30, 2008.

Dividend payments under the revised policy will occur bi-annually on each July 15th, (or the first business day thereafter) and each January 15th (or the first business day thereafter) to be paid to the shareholders of record on June 30th and December 31st (or the first business days thereafter).

In the current fiscal year, Taiga has already distributed in excess of 25% of the prior fiscal year's Net Earnings. Accordingly the first dividend payment, if any, under the new policy will be on July 15, 2009 and based upon the fiscal year ended March 31, 2009.

The payment of any dividends by the Company is subject to the discretion of its board of directors and subject to its determination of the Company's capital and operational requirements, adequacy of reserves and compliance with contractual and legal requirements.

The change in dividend policy will, among other things, conserve cash during this period when the tax Settlement must be paid. Taiga also intends to consider other sources of new financing to replenish our working capital and for future operational requirements arising from anticipated slower demand.

Forward-Looking Statements:

This press release contains certain forward-looking information and statements relating, but not limited, to future events or performance and strategies and expectations of Taiga. Forward-looking information typically contains statements with words such as "consider", "anticipate", "believe", "expect", "plan", "intend", "likely", "may", "will", "should", "predict", "potential", "continue" or similar words suggesting future outcomes or statements regarding expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. Readers should be aware that these statements are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward-looking statements.

These forward-looking statements reflect management's current expectations or beliefs and are based on information currently available to Taiga and although Taiga believes it has a reasonable basis for making the forward-looking statements included in this document, readers are cautioned not to place undue reliance on such forward-looking information. By its nature, the forward-looking information of Taiga involves numerous assumptions and inherent risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts and other forward-looking statements will not occur. These factors include, but are not limited to, changes in business strategies; the effects of litigation, competition and pricing pressures; changes in operational costs; changes in laws and regulations, including tax, environmental, employment, competition, anti-terrorism and trade laws; and Taiga's anticipation of and success in managing the risks associated with the foregoing.

Contacts

regarding Taiga please contact: Tom Stefan
Vice President
Finance and Administration
Phone: (604) 438-1471
Fax: (604) 439-4242