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                                                                    Exhibit 99.1
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Contact:   Daniel M. Junius                      Paul Buffum
           Vice President-Finance                Vice president, Secretary
           and CFO                               and General Counsel
           (603) 880-2363                        (603) 880-2952


                NASHUA CORPORATION ADOPTS SHAREHOLDER RIGHTS PLAN
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         Nashua, N.H., July 19, 1996 -- Nashua Corporation (NYSE: NSH) today
announced that its Board of Directors has adopted a Shareholder Rights Plan in
which preferred stock purchase rights will be distributed on September 2, 1996
as a dividend at the rate of one Right for each share of Nashua Corporation
Common Stock outstanding as of the close of business on August 15, 1996. These
rights will replace the rights currently outstanding under the Company's August
22, 1986 Rights Agreement, which will expire on September 2, 1996.

         The Rights Plan is designed to enable all shareholders of Nashua to
realize the long-term value of their investment in the Company. Specifically,
the Plan is designed to deter coercive or unfair takeover tactics and to prevent
an acquiror from gaining control of the Company without offering a fair price to
all of the Company's shareholders. The Rights will expire on September 2, 2006
unless earlier redeemed or exchanged.

         Gerald G. Garbacz, Nashua's chairman, chief executive officer and
president, said "The Rights Plan will not restrict consideration by the Board of
any offer on terms favorable to all shareholders. Rather, it is intended to
protect the interests of shareholders in the event that the Company is
confronted with coercive or unfair takeover tactics."

         Such tactics include a partial or two-tiered tender offer that does not
treat all shareholders equally, the acquisition in the open market or otherwise
of shares constituting control without offering fair value to all shareholders,
or other abusive takeover tactics. Garbacz added, "These tactics can unfairly
pressure shareholders out of their investment without giving them any real
choice, and deprive them of the full value of their shares. With this in mind,
Nashua's Plan is similar to plans that have been adopted by more than 1,500
public companies."

         Each Right will entitle the holders of Common Stock of Nashua
Corporation to purchase one one-hundredth of a share of a new series of junior
participating preferred stock of the Company at an exercise price of $75.00. The
Rights will be exercisable only if a person or group has acquired beneficial
ownership of ten


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percent or more of the common stock of the Company or announces a tender or
exchange offer that would result in such person or group owning ten percent or
more of the common stock of the Company.

         If any person becomes the beneficial owner of ten percent or more of
the shares of common stock of the Company, except pursuant to a tender or
exchange offer for all shares at a fair price as determined by the outside Board
members, each Right not owned by the ten percent or more shareholder will enable
its holder to purchase that number of shares of the Company's common stock which
equals the exercise price of the Right divided by one-half of the current market
price of such common stock at the date of the occurrence of the event. In
addition, if the Company is involved in a merger or other business combination
transaction with another person or group in which it is not the surviving
corporation or in connection with which its common stock is changed or
converted, or it sells or transfers 50 percent or more of its assets or earning
power to another person, each Right that has not previously been exercised will
entitle its holder to purchase that number of shares of common stock of such
other person which equals the exercise price of the Right divided by one-half of
the current market price of such common stock at the date of the occurrence of
the event.

         The Company will generally be entitled to redeem the Rights at $.01 per
Right at any time until the tenth day following public announcement that a ten
percent stock position has been acquired and in certain other circumstances.

         Nashua Corporation offers a diverse mix of products including thermal
papers, pressure-sensitive labels, specialty papers, copies and laser printer
supplies, and photofinishing services.