VANCOUVER, BRITISH COLUMBIA--(Marketwired - Apr 14, 2014) - Coast Wholesale Appliances Inc. (TSX:CWA) ("Coast") announced today that it has reached an agreement with CWAL Investments Ltd. ("CWAL") with respect to Coast's shareholder rights plan (the "Rights Plan") as it relates to CWAL's offer to purchase all of the outstanding common shares of Coast not beneficially owned by CWAL and its joint actors at a price of $4.55 per share (the "Offer").

Under the agreement reached, CWAL will amend the terms and conditions of the Offer such that:
(i) the condition under the Offer that at least a majority of the total number of common shares of Coast outstanding, excluding shares beneficially owned by CWAL and its joint actors, has been validly deposited under the Offer (the "Minimum Tender Condition") shall be irrevocable; and
(ii) upon the Minimum Tender Condition being satisfied, and all other conditions of the Offer being satisfied or waived, CWAL will make a public announcement of the satisfaction of the Minimum Tender Condition and extend the expiry date of the Offer for at least 10 additional business days following such announcement. Coast will conditionally waive the application of the Rights Plan upon Coast being advised by CWAL that the Minimum Tender Condition has been satisfied.

As a result of Coast's agreement with CWAL, CWAL has withdrawn its application to the British Columbia Securities Commission (the "BCSC") to cease trade the Rights Plan and the hearing scheduled for April 14, 2014 to address such application will be cancelled.

Coast adopted the Rights Plan on March 4, 2014 to ensure: (i) that the Special Committee and the Board of Directors (the "Board") of Coast will have sufficient time to properly develop and pursue alternatives to maximize value for all shareholders; and (ii) that all shareholders of Coast are treated fairly in any transaction involving a change of control of Coast.

Coast's agreement with CWAL eliminates the inherently coercive nature of the Offer which previously permitted CWAL to waive the Minimum Tender Condition at its sole discretion. Therefore, absent the Rights Plan or Coast's agreement with CWAL, CWAL could simply take-up as little as 11% of the issued and outstanding shares of Coast and obtain absolute control and CWAL would not be required to notify Coast shareholders if such condition is satisfied or waived, nor would CWAL be required to provide additional time for shareholders to tender to the Offer with the benefit of that information.

Now, as a result of Coast's agreement with CWAL, at least a majority of the common shares of Coast not beneficially owned by CWAL and its joint actors (approximately 30% of Coast's outstanding shares) must be validly tendered under the Offer before being able to be taken up by CWAL. In addition, shareholders of Coast can delay tendering to the Offer unless and until CWAL has announced the satisfaction of the Minimum Tender Condition because CWAL must provide shareholders with an additional 10 business days to tender following such announcement.

The agreement reached by CWAL does not hinder in any way the ability of Coast to continue discussions with third parties regarding alternative transactions aimed at maximizing value for all shareholders of Coast.

The Board continues to recommend to shareholders of Coast that they REJECT the Offer and DO NOT TENDER their common shares to the inadequate Offer. Shareholders who have already tendered their shares and wish to withdraw shares should contact their broker to withdraw their shares as soon as possible. The Board's recommendation to shareholders of Coast and a more detailed discussion of the reasons for rejecting the Offer are contained in the Directors' Circular dated March 26, 2014. The Directors' Circular includes an inadequacy opinion and a formal valuation from CIBC World Markets Inc., which confirm that: (i) the consideration offered to shareholders of Coast pursuant to the Offer is inadequate from a financial point of view to such shareholders; and (ii) the fair market value of the common shares of Coast is in the range of $5.25 to $5.75 per share.

The Directors' Circular is available on SEDAR at www.sedar.com and was mailed to shareholders of Coast on March 27, 2014.

In addition, Coast announces its intention to adjourn to a later date to be determined by the Board, the special meeting of its shareholders scheduled for May 21, 2014 (the "Special Meeting") which was to be held to consider the ratification of the Rights Plan.

About Coast

Coast is a leading independent supplier of major household appliances and accessories to builders and developers of multi-family and single-family housing, and to retail customers. Founded in 1978, Coast operates stores across the four western provinces and in the Greater Toronto Area of Ontario, as well as a network of warehouse distribution centres strategically situated to serve these locations.

Forward-Looking Statements and Information

Certain statements herein may contain forward-looking statements and forward-looking information within the meaning of applicable securities laws. Such forward-looking statements and forward-looking information include, but are not limited to, statements concerning the amendments to be made by CWAL to the Offer, the conditional waiver by Coast of the application of the Rights Plan upon being advised by CWAL that the Minimum Tender Condition has been satisfied, the cancellation of the hearing at the BCSC to be held on April 14, 2014, Coast continuing discussions with third parties regarding alternative transactions aimed at maximizing value for all shareholders of Coast and the intention of management to adjourn the Special Meeting. Such statements and information include statements regarding the expectation and beliefs of management and appear in a number of places and often can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate" or "believes" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.

Although the forward-looking statements contained herein are based upon what management believes to be reasonable assumptions, Coast cannot assure investors that actual results will be consistent with these forward-looking statements. The forward-looking statements reflect management's current beliefs and are based on information currently available to Coast. They speak only as of the date hereof, and reflect current assumptions regarding future events and operating performance. These assumptions include, without limitation: slow economic growth in Coast's current market areas; continued fluctuations in exchange rates; continued low interest rates through 2014; continuing cautious credit markets in which Coast's major builder customers obtain financing for their current and future building activities; weak consumer confidence due to the slow economic recovery, which may be reflected in lower retail sales; and no significant change to the total housing starts in 2014 compared to those recorded in 2013.

Forward-looking statements are subject to known and unknown risks, uncertainties and other factors which could cause actual results of Coast to differ materially from the conclusion, forecast or projection stated in such forward-looking statements. These risks, uncertainties and other factors include, but are not limited to: actions taken by CWAL; actions taken by directors, officers and shareholders of Coast in respect of the Offer; the possible effect of the Offer on Coast's business; sensitivity to general economic conditions; changes in consumer confidence in the economy; maintenance of profitability and management of changes in Coast's business; competition; increases to interest rates; reliance on suppliers and their ability to supply product for sale on a timely basis; changes in consumer preferences; changes in the mix of product sales; fluctuations in fuel and commodity pricing, which may impact freight and other costs; usage of extended warranty programs and the costs to deliver these services; changes to planning and supply chain processes; lack of long term supplier agreements; reliance on key personnel; foreign exchange rates as they relate to imported products and Coast's suppliers' costs; and other factors referenced in Coast's continuous disclosure filings which are available on SEDAR at www.sedar.com.

These forward-looking statements are made as of the date hereof and Coast assumes no obligation to update or revise them to reflect new events or circumstances, other than as required by law.