Calloway's Nursery And 3K Limited Partnership Announce Commencement Of Joint Tender Offer For Shares Of Calloway's Common Stock

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Jan 20, 2016, 09:00 ET

FORT WORTH, Texas, Jan. 20, 2016 /PRNewswire/ -- Calloway's Nursery, Inc. (PK:CLWY) ("Calloway's") and 3K Limited Partnership ("3K") today announced that, pursuant to a Recapitalization Agreement between the parties (the "Recapitalization Agreement"), they have commenced a joint tender offer to purchase up to 4,000,000 shares of Calloway's common stock at a purchase price of $2.52 per share. The joint tender offer is being made pursuant to an Offer to Purchase, dated January 20, 2016 (the "Offer to Purchase"), and a related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the "Offer").

Pursuant to the terms of the Recapitalization Agreement, the first 2,000,000 shares tendered in the Offer will be purchased by Calloway's, the next 1,000,000 shares tendered in the Offer will be purchased by 3K and any shares tendered in excess of the first 3,000,000 shares will be purchased by Calloway's and 3K on a fifty-fifty basis.

Participation in the Offer by Calloway's shareholders is voluntary and shareholders are not required to tender any shares in the Offer. If more than 4,000,000 shares are tendered in the Offer, Calloway's and 3K will purchase 4,000,000 shares from all shareholders who validly tendered their shares in the Offer on a pro rata basis. The Offer is not conditioned on a minimum number of shares being tendered, but is subject to the satisfaction or waiver of certain closing conditions described in the Offer to Purchase.

The Offer will expire at 5:00 P.M., Central Time, on February 18, 2016, unless extended. Shareholders who wish to tender their shares in the Offer must properly tender such shares prior to the expiration of the Offer. Tendered shares may be withdrawn at any time prior to the expiration of the Offer.

Immediately following the expiration of the Offer, 3K has agreed to purchase substantially all of the shares of Calloway's common stock held by James Estill, the Chief Executive Officer, Chairman of the Board of Directors and co-founder of Calloway's, and John Cosby, a former executive officer, former member of the Board of Directors and co-founder of Calloway's, at the same price that is being offered to shareholders in the Offer. The Offer and the purchase of these shares by 3K are collectively referred to as the "Recapitalization."

The purpose of the Recapitalization is primarily to (i) facilitate the sale of substantially all of the shares held by Messrs. Estill and Cosby, and, at the same time, (ii) provide an opportunity for liquidity to Calloway's shareholders on the same terms as the sale of shares by Messrs. Estill and Cosby and (iii) allow 3K to obtain a controlling block of Calloway's outstanding common stock. As a result of the Recapitalization, 3K and its affiliates will be the largest holder of Calloway's common stock and will be able to control the outcome of the election of members of Calloway's Board of Directors and other items for which shareholder approval is required or sought.

The information agent for the Offer is Georgeson, Inc. The depositary for the Offer is Computershare Trust Company, N.A. The Offer to Purchase and the related Letter of Transmittal are being distributed to Calloway's shareholders and will also be made available for distribution to beneficial owners of Calloway's common stock. Shareholders that have questions about the Offer or that wish to obtain additional copies of the Offer to Purchase and the related Letter of Transmittal should contact the information agent at its phone number or address as follows:

Georgeson, Inc.
480 Washington Blvd., 26th Floor
Jersey City, NJ 07310
Telephone: (866) 431-2101 (Toll-Free)

None of Calloway's, its Board of Directors, 3K, Georgeson or Computershare make any recommendation as to whether you should tender your shares in the Offer.

Additional Information

This announcement is for informational purposes only. This announcement is not an offer to purchase or a solicitation of an offer to purchase any shares. The Offer is being made solely pursuant to the Offer to Purchase and related Letter of Transmittal. Shareholders are urged to read the Offer to Purchase and the related Letter of Transmittal because they contain important information, including the various terms of, and conditions to, the Offer. The Offer is not being made to shareholders in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction.

Forward-looking Statements

This press release contains forward-looking statements about the expectations, beliefs, plans, intentions, and strategies of Calloway's. Forward-looking statements may be identified by the use of certain words, including, among others, "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "outlook," "plan," "potential," "predict," "project," "should," "will," "would" and similar expressions. Forward-looking statements are based on current expectations, estimates and projections, and they are not guarantees of future performance. There are a number of important factors that could cause actual results to differ materially from those anticipated by any forward-looking statements. Such factors include, but are not limited to: the successful closing of the Offer or the Recapitalization, uncertainty regarding the value of Calloway's shares and general economic, market or business conditions. All of the forward-looking statements made in this press release are qualified by these cautionary statements, and there can be no assurance that the actual results anticipated will be realized, or, if substantially realized, will have the expected consequences. Except as required by law, Calloway's undertakes no obligation to publicly update or revise any forward-looking statements.

About Calloway's

Founded in 1986, Calloway's Nursery, Inc. is a 17-store garden center chain serving the Dallas - Fort Worth and Houston markets as Calloway's Nursery in D/FW and Cornelius Nursery in Houston. Calloway's strives to make gardening fun, easy and successful for customers by offering expert advice from Texas Certified Nursery Professionals; store environments that are educational and easy to shop; gardening clinics that serve both novice and expert gardeners; displays and instructions to aid gardeners with design and color development in their yards; and a product selection of the best plant varieties available.

About 3K

3K Limited Partnership is a private investment firm organized to invest the capital of a private family trust.

SOURCE Calloway's Nursery, Inc.