<PAGE>
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): NOVEMBER 5, 1998
CELLSTAR CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 0-22972 75-2479727
(STATE OF (COMMISSION FILE (I.R.S. EMPLOYER
INCORPORATION) NUMBER) IDENTIFICATION NO.)
1730 BRIERCROFT COURT, CARROLLTON, TEXAS 75006
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:
(972) 466-5000
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ITEM 5. OTHER EVENTS
On November 5, 1998, CellStar Corporation issued a press release announcing
a settlement of claims in its pending class action litigation. The press release
has been filed as an exhibit to this report and is incorporated by reference
herein.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) EXHIBITS
99.1 Press Release dated November 5, 1998
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.
CELLSTAR CORPORATION
November 10, 1998 By /s/ ELAINE F. RODRIGUEZ
---------------------------------------
Elaine F. Rodriguez
Vice President and General Counsel
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EXHIBIT INDEX
Exhibit Description
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99.1 Press release dated November 5, 1998
<PAGE>
EXHIBIT 99.1
[LETTERHEAD OF CELLSTAR APPEARS HERE]
NEWS RELEASE
- --------------------------------------------------------------------------------
FOR IMMEDIATE RELEASE
CONTACT: J. Warren Henry
Investor Relations
(972) 466-5031
CELLSTAR REACHES SETTLEMENT IN PENDING CLASS ACTION LITIGATION
CARROLLTON, TEXAS -- November 5, 1998 -- CellStar Corporation (NASDAQ:
CLST) today announced that it has agreed to a settlement of all claims in the
pending class action litigation involving the State of Wisconsin Investment
Board as lead plaintiff. The parties have signed a Memorandum of Understanding
and are negotiating the terms of a definitive settlement agreement, which will
be subject to court approval. The case represents the consolidation of lawsuits
that were filed from May 1996 to July 1996.
Based on the settlement, CellStar expects to recognize a one-time charge of
approximately $8.0 million (approximately $5.0 million after giving effect to
taxes) for the quarter ending November 30, 1998, reflecting the Company's
portion of payments under the settlement and legal costs associated with the
litigation.
"While we are confident that CellStar would ultimately have prevailed in
this lawsuit, the process was going to be drawn out, distracting for management,
and expensive," said Dick Gozia, president and chief operating officer for
CellStar. "Therefore, we believe that the best course of action was an early
settlement that would allow us to move forward and focus our attention on
growing the Company's business."
CellStar Corporation is a global integrated wholesaler and retailer of
wireless handsets and other wireless communications products, with operations in
North America, the Asia-Pacific Region, Latin America and Europe. The Company is
one of the world's largest non-carrier wholesale distributors of wireless
handsets for major manufacturers. For the first nine months of 1998, the Company
recorded revenues of $1.4 billion. Additional information about CellStar may be
found on its website at www.cellstar.com.
This press release contains forward-looking statements, as defined in the
Private Securities Litigation Reform Act of 1995. A variety of risk factors,
including delays in legal proceedings and other risk factors discussed in the
Company's Annual Report on Form 10-K and most recent Quarterly Report on Form
10-Q on file with the SEC, could cause CellStar's actual results to vary
materially from anticipated results or other expectations expressed in the
Company's forward-looking statements.
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