TDZ HOLDINGS INC.: News Release.

TORONTO -- TDZ HOLDINGS INC., today announced its results for the nine months ended September 30, 2004.

Overview

The Company was formed on April 28, 1999 on the amalgamation of Tridel Enterprises Inc. ("TEI") and TDZ Holdings Inc. as part of a comprehensive restructuring of TEI's debt and guarantee obligations (the "Restructuring"). The Company has a 33% direct equity interest in Nualt Enterprises Inc. ("Nualt"), the parent company for the Construction Technology Business carried on by Aluma Enterprises Inc. and its subsidiaries, and the principal holding company for the former Residential Real Estate Business (collectively the "Businesses"). The Company's investment in Nualt has been pledged to Nualt's principal lenders (the "Lenders") to secure guarantee obligations. It is anticipated that all available cash flow of Nualt will be used to repay its indebtedness.

Summary of results

Net income for the nine months ended September 30, 2004 was $69,558,000 ($1.99 per share) on revenues of $289,000 as compared to a net income of $6,319,000 ($0.18 per share) on revenues of $200,000 for the nine months ended September 30, 2003.

The net income for the nine months ended September 30, 2004 was the result of a $71,011,000 adjustment to the net investment in Nualt as described below.

The net income for the nine months ended September 30, 2003 was the result of the equity share of Nualt's income. Nualt's net income for the nine months ended September 30, 2003 includes approximately $17,719,000 of foreign currency translation gains that are non-recurring in nature. The Company has included in income $5,847,000 ($0.17 per share) for its 33% share of this amount.

Cash used by operations before other working capital items was $29,000 ($0.00 per share) during the nine months ended September 30, 2004. Overall there was a $446,000 net increase in cash during this period. During prior periods, all of the general and administrative costs of the Company had been reimbursed by the Businesses as revenue to the Company. After July 29, 2004 the Company will be solely responsible for funding these costs.

Net investment in Nualt

At April 28, 1999, Nualt had a shareholder's deficiency of $69,776,000. Since the Company (as a result of its amalgamation) assumed guarantee obligations for approximately $190,000,000 of the debt of Nualt and its subsidiaries, the Company recorded a liability for the estimated fair value of the guarantee. The fair value of these obligations at April 28, 1999 has been determined to be the full amount of Nualt's shareholder deficiency at that date.

From April 28, 1999 to July 29, 2004 the net investment in Nualt was accounted for by the equity method and accordingly included the Company's share of net income or loss of Nualt during that period. During the period April 29, 1999 to July 29, 2004, Nualt has had cumulative net losses of $3,742,000. The Company recorded its 33% cumulative share in the amount of $1,235,000.

On July 29, 2004 the Company announced that the Residential Real Estate Business had been sold to a corporation in which an affiliate of Tridel Financial Corporation ("TFC") has a significant interest. TFC owns approximately 41% of the outstanding shares of the Company. In addition, the Company received sufficient funds to pay the balance owing on its outstanding Contingent Rights issued in connection with the Restructuring, with the result that the Company's obligations with respect to the Contingent Rights have been discharged. All of the net proceeds from the sale of the Residential Real Estate Business were applied to the repayment of the outstanding indebtedness of Nualt, a portion of which is guaranteed by the Company.

As part of the transaction, the unlimited guarantee of the Company in respect of the indebtedness of the Businesses was changed to a limited recourse obligation. As a result, the Lenders now have recourse only to the shares of Nualt held by the Company to satisfy any claims made under the guarantee. The Company, in turn, relinquished its rights under certain restructuring agreements to have its administrative and operating costs reimbursed, with the result that the Company is now solely responsible for those expenses.

The Company reflected the above as follows (in thousands of dollars):

Adjustment to fair value of the
 original net investment in Nualt                   69,776

Adjustment to fair value of the equity
 accounting in Nualt up to July 29, 2004             1,235
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                                                    71,011
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Since the Company has no legal obligation beyond the pledge of shares of Nualt to the Lenders, the Company has adjusted the equity reflected to nil.

The Company has determined that it no longer exercises significant influence over Nualt and will account for its investment in Nualt on a cost basis after July 29, 2004.