SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): February 8, 1999
MARSHALL INDUSTRIES
(Exact Name of Registrant as Specified in Charter)
California 1-5441 95-2048764
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
9320 Telstar Avenue, El Monte, California 91731-2895
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number including area code: (626) 307-6000
Not applicable.
(Former name or former address, if changed since last report.)
Item 5. Other Events.
ADOPTION OF SHAREHOLDER RIGHTS PLAN
On February 5, 1999, the Board of Directors of Marshall
Industries, a California corporation (the "Company"), declared a
distribution of one Right for each outstanding share of common
stock (the "Common Shares") of the Company. The distribution is
to be made as of February 19, 1999 (the "Record Date") to the
shareholders of record on that date. Each Right entitles the
registered holder to purchase from the Company, initially, one
one-thousandth of a share of Junior Participating Preferred Stock
("Preferred Shares") at a price of $100 (the "Purchase Price"),
subject to adjustment. The description and terms of the Rights
are set forth in a Rights Agreement (the "Rights Agreement")
between the Company and First Union National Bank, as Rights
Agent.
Under the Rights Agreement, Preferred Shares
purchasable upon exercise of the Rights will be entitled to
dividends of 1000 times the dividends per share declared on the
Common Shares and in the event of liquidation will be entitled to
a minimum preferential liquidating distribution of $l000 per
share and an aggregate liquidating distribution per share of 1000
times the distribution made per Common Share. The Preferred
Shares will vote together with the Common Shares and in the event
of any merger, consolidation or other transaction in which Common
Shares are exchanged, each Preferred Share will be entitled to
receive 1000 times the amount received per Common Share.
Because of the Preferred Shares' dividend and
liquidation rights, the value when issued of the one one-
thousandth interest in a Preferred Share purchasable upon
exercise of each Right should approximate the value of one Common
Share.
Until the earlier to occur of (i) 10 business days
following a public announcement that a person or group of
affiliated or associated persons (an "Acquiring Person") has
acquired beneficial ownership of 20% or more of the Company's
general voting power other than pursuant to a Qualified Offer (as
defined below), the date of such public announcement being called
the "Stock Acquisition Date," or (ii) 10 business days (or such
later date as may be determined by action of the Board of
Directors) following the commencement of, or announcement of an
intention to make, a tender offer or exchange offer the
consummation of which would result in the beneficial ownership by
a person or group of 20% or more of the Company's general voting
power (the date of such earlier occurrence being called the
"Distribution Date"), the Rights will be evidenced by the
certificates representing the Common Shares and will be
transferred with and only with the Common Shares. New
certificates representing Common Shares issued after the Record
Date upon transfer or new issuance of Common Shares will contain
a notation incorporating the Rights Agreement by reference, and
the surrender for transfer of any certificate for Common Shares,
even without such notation or a copy of the Summary of Rights
being attached thereto, will also constitute the transfer of the
Rights associated with the Common Shares represented by such
certificate. As soon as practicable following the Distribution
Date, separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Common
Shares as of the close of business on the Distribution Date and
such separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution
Date. The Rights will expire on the tenth anniversary of the
Record Date (the "Final Expiration Date"), unless the Final
Expiration Date is extended or unless the Rights are earlier
redeemed or exchanged by the Company, as described below.
The Purchase Price payable, the number of shares or
other securities or property issuable upon exercise of the Rights
and the number of outstanding Rights are subject to adjustment
from time to time to prevent dilution. With certain exceptions,
no adjustment in the Purchase Price will be required until
cumulative adjustments require an adjustment of at least 1% in
such Purchase Price. No fractional shares will be issued upon
the exercise of the Rights and in lieu thereof, a cash payment
will be made based on the market price of the Company's common
stock on the last trading date prior to the date of exercise.
A "Qualified Offer" is a tender offer or exchange offer
for all outstanding Common Shares which is determined by at least
a majority of the members of the Board of Directors to be
adequate and otherwise in the best interests of the Company and
its shareholders.
In the event that any person becomes an Acquiring
Person other than by a purchase pursuant to a Qualified Offer,
proper provision shall be made so that each holder of a Right,
other than Rights beneficially owned by the Acquiring Person
(which will not be entitled to the benefit of such adjustment)
will thereafter have the right to receive upon exercise that
number of Common Shares or Common Share equivalents having a
market value of two times the exercise price of the Right. For
example, at a purchase price of $100 per Right, each Right not
owned by an Acquiring Person (or by certain related parties)
following an event set forth in the preceding sentence would
entitle its holder to purchase $200 worth of common stock of the
Company (or other consideration, as noted above) for $100.
Assuming that the Common Stock had a per share value of $20 at
such time, the holder of each valid Right would be entitled to
purchase 10 shares of Common Stock for $100.
In the event that, at any time after an Acquiring
Person has become such, the Company is acquired in a merger or
other business combination transaction (other than a merger which
follows a Qualified Offer at the same or a higher price) or 50%
or more of its consolidated assets or earning power are sold,
proper provision will be made so that each holder of a Right will
thereafter have the right to receive, upon the exercise thereof
at the then current exercise price of the Right, that number of
shares of common stock of the acquiring company which at the time
of such transaction will have a market value of two times the
exercise price of the Right.
At any time after an Acquiring Person has become such,
the Board of Directors of the Company may exchange the Rights
(other than Rights owned by such person or group), in whole or in
part, at an exchange ratio of one Common Share per Right (subject
to adjustment).
Up to and including the tenth business day after a
Stock Acquisition Date, the Board of Directors of the Company may
elect to redeem the Rights in whole, but not in part, at a price
of $.01 per Right (the "Redemption Price") by providing the
Rights Agent with written notice of the proposed redemption at
least 40 days prior to the proposed redemption date. Such notice
of redemption may be cancelled by the Board of Directors of the
Company at any time prior to the redemption date by the delivery
of a subsequent notice to the Rights Agent cancelling the
redemption. Immediately upon any redemption of the Rights, the
right to exercise them will terminate and the only right of the
holders will be to receive the Redemption Price.
The terms of the Rights may be amended by the Board of
Directors without the consent of the holders of the Rights at any
time prior to the Distribution Date. Thereafter, subject to
certain limitations set forth in the Rights Agreement, the Rights
may be amended to make changes which do not adversely affect the
interests of the holders of the Rights or which shorten or
lengthen time periods (other than the forty (40) day notice
period required for redemption of the Rights which may not be
shortened).
Until a Right is exercised, the holder thereof, as
such, will have no rights as a shareholder of the Company,
including, without limitation, the right to vote or to receive
dividends. While the distribution of the Rights will not be
subject to federal taxation to shareholders or to the Company,
shareholders may, depending upon the circumstances, recognize
taxable income in the event that the Rights become exercisable
for common stock (or other consideration) of the Company or for
common stock of the acquiring company as set forth above.
The Rights have certain anti-takeover effects. The
Rights will cause substantial dilution to a person or group that
attempts to acquire the Company without conditioning the offer on
a substantial number of Rights being acquired, or in a manner or
on terms not approved by the Board of Directors. The Rights,
however, should not deter any prospective offeror willing to
negotiate in good faith with the Board of Directors. Nor should
the Rights interfere with any merger or other business
combination approved by the Board of Directors.
The foregoing description of the Rights does not
purport to be complete and is qualified in its entirety by
reference to the Exhibits to this Current Report. The Rights
Agreement, Exhibit 4.1 hereto, specifies the terms of the Rights
and includes the Form of Right Certificate (Exhibit A), the
Summary of Rights to Purchase Junior Participating Preferred
Stock (Exhibit B) and the Form of Certificate of Determination
of Junior Participating Preferred Stock (Exhibit C). The form of
the letter to be sent to the Company's shareholders describing
the Rights is Exhibit 20.1, and the Company's press release
announcing the adoption of the shareholder rights plan is
attached hereto as Exhibit 99.1. Each of the Exhibits hereto is
incorporated herein by this reference.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits
(c) Exhibits.
Exhibit No. Description of Exhibit
3.1 Certificate of Determination of Junior
Participating Preferred Stock, filed as Exhibit
2.2 to the Company's Registration Statement on
Form 8-A filed February 16, 1999 and incorporated
herein by this reference.
4.1 Rights Agreement dated as of February 8, 1999
between Marshall Industries and First Union
National Bank, as Rights Agent, including the
Form of Right Certificate (Exhibit A), the
Summary of Rights to Purchase Junior
Participating Preferred Stock (Exhibit B) and the
Form of Certificate of Determination of Junior
Participating Preferred Stock (Exhibit C), filed
as Exhibit 2.1 to the Company's Registration
Statement on Form 8-A filed February 16, 1999 and
incorporated herein by this reference.
20.1 Form of letter to be sent to the Company's
shareholders describing the Rights, filed as
Exhibit 2.3 to the Company's Registration
Statement on Form 8-A filed February 16, 1999 and
incorporated herein by this reference.
99.1 Press Release dated February 9, 1999.
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
MARSHALL INDUSTRIES
By: /s/ Robert Rodin
Robert Rodin
President and Chief Executive Officer
DATED: February 16, 1999