Badger Income Fund releases Canadian tax information


    CALGARY, Feb. 28 /CNW/ - The information provided below is solely to
assist Canadian individual unitholders with tax reporting information in
respect of distributions paid and declared during the calendar year 2007. The
information contained herein is based on Badger Income Fund's understanding of
the Canadian Income Tax Act and the regulations thereunder and is provided for
general information only. Canadian unitholders should consult with a taxation
or investment professional for individual tax advice.

    Fund Units Held Within an RRSP, RRIF, RESP or DPSP
    No amounts are to be reported on the unitholders' 2007 Income Tax Return
where fund units are held within a Registered Retirement Savings Plan (RRSP),
Registered Retirement Income Fund (RRIF), Registered Education Savings Plan
(RESP) or a Deferred Profit Sharing Plan (DPSP).

    Fund Units Held Outside an RRSP, RRIF, RESP or DPSP
    Unitholders who hold their fund units outside of an RRSP, RRIF, RESP or
DPSP and were entitled to receive distributions on a distribution record date
within the calendar year 2007 will receive a T3 Statement of Trust Income
Allocations and Designations slip ("T3") directly from Computershare Investor
Services or from the broker/intermediary who the unitholder holds their fund
units through. The amount reported in Box 26 "Other Income" on the T3 should
be reported on the Unitholders' 2007 Income Tax Return. The deadline for
mailing the 2007 T3's to unitholders, as required by the Canada Revenue
Agency, is March 31, 2008.

    Adjusted Cost Base of Fund Units for Capital Gain Purposes
    Unitholders are required to reduce the adjusted cost base ("ACB") of
their fund units by the amount reported in Box 42 "Amount Resulting in Cost
Base Adjustment" of the T3, which is equal to the cumulative distribution
declared during calendar 2007 less the amount reported as "Other Income" in
Box 26 of the T3. The ACB is used in determining the capital gain or loss on
the disposition of fund units.

    Schedule of Tax Treatment of 2007 Distributions
    The following schedule details the cash distributions declared in 2007
and the tax treatment of each distribution per Trust unit for income tax

                                         Taxable     Tax Deferred      Total
                                         Amount         Amount        Distri-
    Record Date       Payment Date    (T3 - Box 26)  (T3 - Box 42)    bution
    January 31/07     February 15/07    0.09555        0.00945        0.1050
    February 28/07    March 15/07       0.09555        0.00945        0.1050
    March 30/07       April 16/07       0.09555        0.00945        0.1050
    April 30/07       May 15/07         0.09555        0.00945        0.1050
    May 31/07         June 15/07        0.09555        0.00945        0.1050
    June 29/07        July 16/07        0.09555        0.00945        0.1050
    July 31/07        August 15/07      0.09555        0.00945        0.1050
    August 31/07      September 17/07   0.09555        0.00945        0.1050
    September 28/07   October 15/07     0.09555        0.00945        0.1050
    October 31/07     November 15/07    0.09555        0.00945        0.1050
    November 30/07    December 17/07    0.09555        0.00945        0.1050
    December 31/07    January 15/08     0.09555        0.00945        0.1050

    Badger Income Fund is an open-ended trust that is North America's largest
provider of non-destructive excavating services. Badger traditionally works
for contractors and facility owners in the utility and petroleum industries.
Our key technology is the Badger Hydrovac, which is used primarily for safe
digging in congested grounds and challenging conditions. The Badger Hydrovac
uses a pressurized water stream to liquefy the soil cover, which is then
removed with a powerful vacuum system and deposited into a storage tank.
Badger manufactures its truck-mounted hydrovac units.
    Badger Income Fund's business model involves the provision of excavating
services through two distinct entities: the Operating Partners (franchisees in
the United States and agents in Canada), and Badger Corporate. Badger
Corporate works with its Operating Partners to provide Hydrovac service to the
end user. In this partnership, Badger provides the expertise, the trucks, and
North American marketing and administration support. The Operating Partners
deliver the service by operating the equipment and developing their local
markets. All work is invoiced by Badger and then shared with the Operating
Partner based upon a revenue sharing formula. In certain locations Badger has
established corporate run operations to market and deliver the service in the
local area.

    This press release contains forward-looking statements subject to various
risk factors and uncertainties, which may cause the actual results,
performances or achievements of Badger to be materially different from any
future results, performances or achievements expressed or implied by such
forward-looking statements. Such factors include, but are not limited to,
fluctuations in the market for oil and gas related products and services,
political and economic conditions, the demand for services provided by Badger,
industry competition and Badger's ability to attract and retain key personnel.

    The Toronto Stock Exchange has neither approved nor disapproved the
    information contained herein.

    %SEDAR: 00020566E

For further information:

For further information: Tor Wilson, President and CEO, 2820, 715 - 5th
Avenue SW, Calgary, Alberta T2P 2X6; Greg Kelly, CA, Vice President Finance
and CFO, Phone (403) 264-8500, Fax (403) 228-9773

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