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Press release from CNW Group

The Brick Ltd. Announces Cash Tender Offer to Debenture Holders

Monday, March 12, 2012

The Brick Ltd. Announces Cash Tender Offer to Debenture Holders08:30 EDT Monday, March 12, 2012Strong cash position provides the opportunity for early debt retirement of up to $110,138,000 with support of major debenture holdersEDMONTON, March 12, 2012 /CNW/ - The Brick Ltd. (TSX: BRK)("The Brick") announced today that it has commenced an offer (the "Offer") to purchase for cash any and all of its outstanding 12% Senior Secured Debentures due May 30, 2014 (CUSIP Nos. 107879AA6 / 107879AB4) (the "Debentures") on the terms and conditions set out in the Offer to Purchase of The Brick dated March 12, 2012 (as it may be amended or otherwise modified from time to time, the "Offer to Purchase").Details regarding the OfferThe Offer for any and all of the outstanding Debentures commences on March 12, 2012 and will expire at 11:59 p.m. (Eastern Time) on April 6, 2012, unless extended or earlier terminated (such date and time, as the same may be modified, the "Expiration Time").  Registered holders of the Debentures (the "Holders") that wish to receive the Consideration (as defined below) must validly tender and not withdraw their Debentures on or prior to the Expiration Time.  Tendered Debentures may be withdrawn at any time on or prior to the Expiration Time, but not thereafter. As at the date hereof, there is approximately $110,138,000 principal amount of Debentures outstanding.'"As The Brick's financial position continues to strengthen, we are pleased to offer debenture holders market liquidity, at an attractive premium. At the same time, this cash tender offer of debentures represents a key step towards reducing the financing impact of The Brick's 2009 re-capitalization. The offer remains consistent with our previously stated use of cash strategy and is focused on enhancing long-term shareholder value. I am also very satisfied that full support agreements have been acknowledged by our two largest share and debenture holders", commented Vi Konkle, President and CEO of The Brick.If the conditions to the Offer described in the Offer to Purchase are satisfied or waived, then Debentures properly tendered and not validly withdrawn pursuant to the Offer will be accepted for payment immediately after the Expiration Time, and the respective Holders thereof will be entitled to receive for each $1,000 principal amount at maturity of such Debentures an amount in cash (the "Consideration") equal to (i) $1,140 plus (ii) accrued and unpaid interest to, but not including, the date of payment (such date, the "Payment Date").  The Payment Date is expected to occur on the third business day following the Expiration Time.  The Brick expects to fund the purchase of the Debentures pursuant to the Offer from cash on hand and potentially also from borrowings under its credit facility.The Brick has entered into support agreements (the "Support Agreements") with a subsidiary of Fairfax Financial Holdings Limited (such subsidiary, "Fairfax") and William H. Comrie ("Comrie" and, together with Fairfax, the "Supporting Entities"). Pursuant to the Support Agreements, the Supporting Entities each agreed (i) to tender and not withdraw their Debentures pursuant to the Offer not later than the Expiration Time and (ii) to consent to certain amendments to the indenture governing the Debentures which would delete or modify many of the covenants and events of default under the indenture governing the Debentures (the "Debenture Amendments"), and The Brick agreed that, for as long as any Debentures remain outstanding, it will not repurchase any Debentures at a price that is greater than $1,140 per $1,000 principal amount at maturity of such Debentures, plus accrued and unpaid interest. However, unless the Brick takes up and pays for Debentures, including the Supporting Entities' Debentures, pursuant to the Offer, the Debenture Amendments will not become effective. The Supporting Entities did not receive any fee or other payment in consideration for entering into the Support Agreements and performing their obligations thereunder, and will receive the same price for their Debentures in the Offer as each other Holder that validly tenders and does not withdraw its Debentures pursuant to the Offer.  The Offer is conditioned upon certain conditions described in the Offer to Purchase.The Brick has retained Scotia Capital Inc. to act as Dealer Manager for the Offer. Computershare Trust Company of Canada has been retained to act as the Depositary for the Offer and Georgeson has been retained to act as the Information Agent for the Offer. For additional information regarding the terms of the Offer, please contact: Michael Lay at Scotia Capital 1-888-776-3666 or 1-416-863-7257. Requests for documents and questions regarding the tendering of Debentures may be directed to Georgeson at 1-866-656-4118.  Copies of the Offer for Purchase and the supplemental indenture giving effect to the Debenture Amendments are also available electronically on the Brick's website (www.thebrick.com) and under the System for Electronic Document Analysis and Retrieval (SEDAR) System (www.sedar.com).Only Holders will be eligible to tender their Debentures pursuant to the Offer.  Non-registered holders whose Debentures are registered in the name of an intermediary, or in the name of a clearing agency (such as CDS) of which the intermediary is a participant, should promptly contact their intermediaries and follow their intermediaries' instructions with respect to the applicable tender procedures and deadlines, which may be earlier than the deadlines that are set out in this press release.This press release does not constitute an offer to sell or purchase, or a solicitation of an offer to sell or purchase, or the solicitation of tenders with respect to, the Debentures. No offer, solicitation, purchase or sale will be made in any jurisdiction in which such an offer, solicitation, or sale would be unlawful. The Offer is being made solely pursuant to the Offer to Purchase made available to holders of the Debentures. None of The Brick, the Dealer Manager, the Depositary, the Information Agent or their respective affiliates is making any recommendation as to whether or not Holders should tender all or any portion of their Debentures in the Offer. Holders are urged to evaluate carefully all information in the Offer to Purchase, consult their own investment and tax advisors and make their own decisions whether to tender Debentures.About The BrickThe Brick, together with its subsidiaries, is one of Canada's largest volume retailers of household furniture, mattresses, appliances and home electronics, operating under four banners: The Brick, United Furniture Warehouse, The Brick Mattress Store, and Urban Brick.  In addition, through its corporate sales division, The Brick services the subdivision, condominium, hospitality and high-rise builder market.  The Brick's retail and franchise operations are located in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, Prince Edward Island, Nova Scotia, New Brunswick, the Northwest Territory and Yukon.Forward-Looking Statements This news release contains "forward-looking statements" within the meaning of applicable Canadian securities laws, including (but not limited to) statements about The Brick's consolidated sales and operating revenue, consolidated EBITDA, consolidated net loss, sales and operating revenue in the financial services and retail segments, same store sales growth and goodwill and indefinite life intangible asset impairment charges, the financial flexibility and capital resources necessary to manage the business in the current economic environment, and similar statements concerning anticipated future events, results, circumstances, performance or expectations, that reflect management's current expectations and are based on information currently available to management of the Brick and its subsidiaries. The words "may", "will", "should", "believe", "expect", "plan", "anticipate", "intend", "estimate", "predict", "potential", "continue" or the negative of these terms, or other expressions which are predictions of or indicate future events and trends and which do not relate to historical matters, identify forward-looking matters. Reliance should not be placed on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of The Brick to differ materially from anticipated future results, performance or achievements expressed or implied by such forward-looking statements. The Brick undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by applicable law.www.thebrick.comFor further information: Vi Konkle  President and CEO The Brick Group (780) 930-6300 investor@thebrick.com Ken Grondin CFO and President, Financial Operations The Brick Group (780) 930-6300 investor@thebrick.com