<PAGE>
FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 29, 2000
CROWN CENTRAL PETROLEUM CORPORATION
(Exact name of registrant as specified in its charter)
Maryland 1-1059 52-0550682
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
One North Charles Street
Baltimore, Maryland 21201
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:(410)539-7400
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Item 5. Other Events
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On March 7, 2000, Crown Central Petroleum Corporation (CNPa and CNPb
on the American Stock Exchange) announced that it had received a proposal
from Rosemore, Inc., a Maryland corporation that owns approximately 49% of
Crown's Class A common stock and 11% of Crown's Class B common stock, to
acquire all of the issued and outstanding Class A and Class B common stock
held by shareholders other than Rosemore for a price of $8.35 per share.
The Rosemore proposal is subject to, among other conditions, the unanimous
approval of Crown's independent directors, the approval of the transaction
by Crown's shareholders, and the receipt of all necessary governmental
approvals. Rosemore's proposal was subsequently extended to expire at 5
p.m. (Maryland time) on April 17, 2000, or when rejected.
On March 10, 2000, Crown Central Petroleum Corporation announced that
it had received a competing proposal from Apex Oil Company, Inc., a
Missouri corporation that owns approximately 14.7% of Crown's Class A
common stock and 3.5% of Crown's Class B common stock, to acquire all of
the issued and outstanding Class A and Class B common stock held by
Crown's shareholders other than Apex for a price of $9.20 per share. The
Apex proposal is subject to approval by the board of directors and
shareholders of Crown, to the receipt of necessary governmental approvals,
and to Apex Oil Company's ability to conduct due diligence to verify that
there are no material adverse developments which have not been disclosed
in Crown's public filings. The Apex proposal was subsequently extended to
expire at 5 p.m. (Missouri time) on April 17, 2000, or when rejected.
On March 29, 2000, Rosemore advised Crown that it was increasing its
proposal to $9.35 per share, and that its proposal will expire at 5 p.m.
(Maryland time) on March 31, 2000, or when rejected.
Also on March 29, 2000, Apex advised Crown that Apex's proposal of
$9.20 per share in cash is conditioned on the completion of due diligence
and on the finalization of replacement financing for Crown's $125 million
of senior bonds, and that it was advancing two other proposals. Apex is
continuing to advance a stock for stock proposal that it made in November
1999, which it asserts would value the existing Crown shares at $10 per
share, and has also proposed as an alternative that it purchase between
3.5 and 4.5 million Class A shares of common stock from Crown in a private
placement at a price of $9.50 per share. Both of these additional
proposals are stated to include a shortfall distribution if the stock of
the merged company or Crown fails to reach certain trading ranges, and
both are conditioned on the finalization of replacement financing for
Crown's $125 million of senior bonds. The stock for stock merger proposal
is also conditioned on the completion of due diligence.
Crown's board committee of its independent directors is continuing to
consider the proposals of both Rosemore and Apex Oil.
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ITEM 7(C) EXHIBITS
Exhibit No. Description
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99.1 Proposal letter dated March 29, 2000 received from
Rosemore, Inc.
99.2 Letter dated March 29, 2000 from Apex Oil
Company, Inc. regarding certain conditions to
proposal set forth in letter of March 9, 2000
and advancing stock for stock and private
placement proposals.
99.3 Press Release dated March 30, 2000.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, the registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
CROWN CENTRAL PETROLEUM CORPORATION
(Registrant)
By: /s/ John E. Wheeler, Jr.
------------------------
Name: John E. Wheeler, Jr.
Title: Executive Vice President --
Chief Financial Officer
Dated: March 30, 2000
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EXHIBIT INDEX
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Exhibit No. Description
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99.1 Proposal letter dated March 29, 2000 received from
Rosemore, Inc.
99.2 Letter dated March 29, 2000 from Apex Oil
Company, Inc. regarding certain conditions to
proposal set forth in letter of March 9, 2000
and advancing stock for stock and private
placement proposals.
99.3 Press Release dated March 30, 2000.
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EXHIBIT 99.1
[CROWN NEWS RELEASE LETTERHEAD]
Institutional Inquiries:
JOHN E. WHEELER, JR.
Executive Vice President
and Chief Financial Officer
(410) 659-4803
Shareholder Inquiries:
J. STEVEN WISE, Manager,
Corporate & Government Affairs
(410) 659-4859
FOR IMMEDIATE RELEASE
Baltimore, Maryland - March 30, 2000
ROSEMORE AND APEX EACH AMEND CROWN BUYOUT PROPOSALS
On March 7, 2000, Crown Central Petroleum Corporation (CNPa and CNPb
on the American Stock Exchange) announced that it had received a proposal
from Rosemore, Inc., a Maryland corporation that owns approximately 49% of
Crown's Class A common stock and 11% of Crown's Class B common stock, to
acquire all of the issued and outstanding Class A and Class B common stock
held by shareholders other than Rosemore for a price of $8.35 per share.
The Rosemore proposal is subject to, among other conditions, the unanimous
approval of Crown's independent directors, the approval of the transaction
by Crown's shareholders, and the receipt of all necessary governmental
approvals. Rosemore's proposal was subsequently extended to expire at 5
p.m. (Maryland time) on April 17, 2000, or when rejected.
On March 10, 2000, Crown Central Petroleum Corporation announced that
it had received a proposal from Apex Oil Company, Inc., a Missouri
corporation that owns approximately 14.7% of Crown's Class A common stock
and 3.5% of Crown's Class B common stock, to acquire all of the issued and
outstanding Class A and Class B common stock held by Crown's shareholders
other than Apex for a price of $9.20 per share. The Apex proposal is
subject to approval by the board of directors and shareholders of Crown,
to the receipt of necessary governmental approvals, and to Apex Oil
Company's ability to conduct due diligence to verify that there are no
material adverse developments which have not been disclosed in Crown's
public filings. The Apex proposal was subsequently extended to expire at
5 p.m. (St. Louis time) on April 17, 2000, or when rejected.
On March 29, 2000, Rosemore advised Crown that it was increasing its
proposal to $9.35 per share, and that its proposal will expire at 5 p.m.
(Maryland time) on March 31, 2000, or when rejected.
Also on March 29, 2000, Apex advised Crown that Apex's proposal of
$9.20 per share in cash is conditioned on the completion of due diligence
and on the finalization of replacement financing for Crown's $125 million
of senior bonds, and that it was advancing two other proposals. Apex is
continuing to advance a stock for stock proposal that it made in November
1999, which it asserts would value the existing Crown shares at $10 per
share, and has also proposed as an alternative that it purchase between
3.5 and 4.5 million Class A shares of common stock from Crown in a private
placement at a price of $9.50 per share. Both of these additional
proposals are stated to include a shortfall distribution if the stock of
the merged company or Crown fails to reach certain trading ranges, and
both are conditioned on the finalization of replacement financing for
Crown's $125 million of senior bonds. The stock for stock merger proposal
is also conditioned on the completion of due diligence.
Crown's board committee of its independent directors is continuing to
consider the proposals of both Rosemore and Apex Oil.
Headquartered in Baltimore, Maryland since 1930, Crown operates two
Texas refineries with a total capacity of 152,000 barrels per day, 331
Crown gasoline stations and convenience stores in the Mid-Atlantic and
Southeastern U.S., and 13 product terminals along the Colonial, Plantation
and Texas Eastern Product pipelines.
<PAGE>
EXHIBIT 99.2
[Rosemore, Inc. Letterhead]
March 29, 2000
STRICTLY CONFIDENTIAL
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Board of Directors of
Crown Central Petroleum Corporation
One North Charles Street Baltimore, Maryland 21201
Attention: Mr. Michael F. Dacey
Ladies and Gentlemen:
In response to your March 24th letter to us, after careful
consideration, the Board of Directors of Rosemore, Inc. ("Rosemore") is
pleased to submit to you a revised proposal to acquire all of the
outstanding shares of Class A and Class B Common Stock of Crown Central
Petroleum Corporation (the "Company") for a price of $9.35, payable in
cash, for each outstanding share not owned by us. Our proposal has been
approved by the Board of Directors of Rosemore, and no other corporate
proceeding is necessary on our part. In addition, with the assistance of
the Company's representatives we have satisfactorily concluded our due
diligence. Our proposal therefore only remains subject to (i) the approval
by Company's board of directors, including the unanimous approval of the
independent directors, (ii) the approval of the transaction by the
Company's shareholders and (iii) the receipt of all necessary government
approvals. We have previously submitted to you a form of merger agreement
that we are prepared to execute, subject to our satisfaction with the
information contained in the disclosure schedule that you supply to us in
response to the merger agreement. Based upon our discussions and the
discussions of our legal advisors on the merger agreement to this point,
we believe that we can resolve all outstanding issues quickly and are
prepared to do so. Our proposal will expire at 5:00 p.m., Maryland time on
March 31, 2000or at such time as our proposal is rejected by or on behalf
of the Company. Please call Mr. Edward L. Rosenberg at Rosemore (410-347-
7090), Mr. Garfield L. Miller III at Aegis Muse Associates (212-245-2552),
or Mr. John A. Marzulli, Jr. at Shearman & Sterling (212-848-8590) if you
would like to discuss any aspect of our proposal.
Sincerely,
ROSEMORE, INC.
By: /s/ Edward L. Rosenberg
-----------------------
Name: Edward L. Rosenberg
Title: President and Chief
Executive Officer
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EXHIBIT 99.3
March 29, 2000
Committee of Independent Directors
Crown Central Petroleum Corporation
One North Charles Street
Baltimore, Maryland 21201
Ladies and Gentlemen:
Enclosed herewith is a form of acquisition agreement we are submitting as
a revision to our March 9, 2000 merger proposal to the Board of Directors
of Crown Central Petroleum Corporation ("Crown"). As you know, on March
9,2000, we submitted our $9.20 per share cash merger proposal with
accompanying draft of merger agreement. On March 15, 2000, your counsel
submitted to us a "mark-up" of our form of merger agreement suggesting,
inter alia, that the transaction we proposed be restructured to include a
first step tender offer and follow-up merger. Although we have had no
substantive response to our proposal, because we have no objection to
restructuring the transaction as your counsel requested, we are submitting
the enclosed acquisition agreement to replace the merger agreement
previously submitted. As outlined in the attached document, this offer is
conditioned upon a reasonable period to complete due diligence and
finalize replacement financing for Crown's $125 million of senior bonds.
We are actively pursuing this replacement financing. We are also enclosing
a copy of Apex's Unaudited Consolidated Financial Statements for February
2000, to help demonstrate our earnings power and ability to complete an
acquisition of Crown. Your facsimile memorandum of Friday, March 24, 2000
indicates a "preference" for cash bids. We find this interesting as our
repeated requests over the past months to meet with the Committee to
discuss options for potential transactions and/or determine the
Committee's preferences have been thwarted on one pretext or another.
Despite this newfound direction, we continue to believe that other
alternatives may provide more value to the Crown shareholders. Our stock-
for-stock merger proposal, which we initially made in November1999, values
the existing Crown shares at a minimum of $10.00 per share. Your counsel
has informed us that you are unwilling to meet with us to explore a stock-
for-stock transaction, and advised that our investment bankers (Bear
Stearns & Co.) must meet with your bankers (Credit Suisse First Boston) to
present and discuss the terms of such a transaction. Accordingly, we have
instructed our bankers to prepare the appropriate presentation and
schedule a meeting with CSFB as soon as practicable for this purpose. When
they meet, Bear Stearns will explain that our stock-for-stock proposal now
contains value protection for Crown shareholders in that Apex will commit
to make a "shortfall distribution" to all shareholders on December 31,
2001 if the average closing price of the shares for the combined company
has not reached $12.00 (a 50% increase over the current price) for a
period of at least five consecutive days prior to that date. The
"shortfall distribution "will be equal to the difference between $12.00
and the highest five-day average closing price during the period. This
stock-for-stock merger proposal is similarly conditioned upon a reasonable
period to complete due diligence and finalize replacement financing for
Crown's $125 million of senior bonds. Because we have been unable to meet
with the Committee and get your input, we have also been unable to
present, for consideration by the Committee, other alternatives to
maximize shareholder value. As a third alternative to our all-cash and
all-stock proposals, Apex would purchase between 3.5 and 4.5 million Class
A common shares from Crown in a private placement at a price of $9.50 per
share, infusing badly needed equity in to the company. Further, Apex would
provide the same "shortfall distribution" incentive outlined above based
on the $12.00 per share average closing price. This proposal would not be
conditioned upon further due diligence. However, suspension of the Rights
Agreement dated February 1, 2000 and replacement financing, to the extent
that the $125 million of senior bonds become due as a result of this
transaction, would be conditions. In contrast to the discussions with
counsel for the Committee on Thursday, March 23, 2000 in which we were
instructed to have Bear Stearns contact CSFB, the March 24, 2000
memorandum requests "best and final offers "to be submitted no later than
4:30pm today. However, the request for such offers expressly notes that
the Committee is not bound by the deadline, may not bring the process to
conclusion at the end of today, and may modify any of the procedures used
prior to the deadline. We can only conclude from these events that you
desire to have cash offers submitted today but will consider the proposals
presented to CSFB in due course. Bear Stearns will be contacting CSFB soon
to continue this process. As you know, our $9.20 per share cash offer has
been extended, at your request, and does not expire until April 17, 2000.
Finally, we must again reiterate our concern that there exists some bias
among certain of your management personnel against Apex and in favor of a
related party. A number of circumstances contribute to our concerns. The
Chairman of your board is maintaining a competing offer for Crown, at a
price that we and other shareholders believe to be inadequate. There have
been repeated delay tactics to forestall a meeting with us and avoid our
due diligence. We have received contradictory responses from
representatives of the Committee. Now, you have established the date for
the "best and final offers" on the day of Crown's release of its 1999 Form
10-K. All of these circumstances fuel our concerns that the process has
been compromised. We again are requesting the opportunity to meet with the
Committee to discuss our interest in combining our companies and, as a
result thereof, to refine our "best and final" proposal. We firmly believe
that a combination of our companies serves the best interests of our
respective shareholders, employees, business partners and communities.
Given that our proposals to date result in the highest values being
offered to Crown shareholders, and the past unfair treatment we have been
afforded in our attempts to discuss our proposals with your board, we urge
full consideration of our position. By copy of this letter, we are
forwarding courtesy copies of our acquisition agreement to both Credit
Suisse First Boston and Skadden, Arps, Slate, Meagher & Flom.
Sincerely,
Apex Oil Company, Inc.
/s/--Edwin L. Wahl
Edwin L. Wahl
President
