ADAC Laboratories, Inc. Named in Shareholder Class Action Suit.

MINNEAPOLIS--(BUSINESS WIRE)--Jan. 21, 1999--Pursuant to Section 21D (a)(3)(A)(i) of the Private Securities Litigation Reform Act of 1995, Lockridge Grindal Nauen & Holstein P.L.L.P. hereby gives notice that a class action complaint has been filed in the United States District Court for the Northern District of California on behalf of a Class of persons who purchased common stock issued by ADAC Laboratories, Inc. (Nasdaq: ADACE news; "ADAC Labs" or the "Company") at artificially inflated prices during the period January 10, 1996 through December 28, 1998 (the "Class Period") and who were damaged thereby. The case allegedly involves a manipulation of financial statements in which, among other acts of deception, defendants knowingly or recklessly overstated ADAC Labs' results of operations, net worth and gross profit for fiscal years 1996, 1997 and 1998.

The Complaint charges that throughout the Class Period, ADAC Labs, R. Andrew Eckert, ADAC Labs' Chief Executive Officer, P. Andre Simone, ADAC Labs' Vice President of Finance, Treasurer and Chief Financial Officer, and David L. Lowe, ADAC Labs' Chairman of the Board of Directors, violated Sections 10(b) and 20(a) of the Securities Exchanges Act of 1934 by issuing statements during the Class Period regarding the Company's second quarter ended September 30, 1998, which were materially false and misleading. The complaint charges that during the Class Period, the defendants assured investors that the Company's revenue were increasing each quarter. On December 29, 1998, the Company shocked the market when it disclosed that it would restate its financials for fiscal years 1996, 1997 and 1998. The restatement was necessitated by the fact that defendants had improperly recognized revenue prematurely and improperly treated certain charges and expenses in violation of generally accepted accounting principles ("GAAP").

Plaintiffs are represented by the law firm of Lockridge Grindal Nauen & Holstein P.L.L.P. The firm has considerable experience in prosecuting securities class actions.

If you are a member of the class described above, you may, if you so choose, but not later than March 1, 1999 file a motion with the District Court to serve as lead plaintiff. Class members must meet certain legal requirements to serve as a lead plaintiff. If you have questions or information regarding this action, or if you are interested in serving as a lead plaintiff in this action, you may call or write:

Gregg M. Fishbein Lockridge Grindal Nauen & Holstein P.L.L.P. 100 Washington Avenue South Suite 2200 Minneapolis, MN 55401 [phone] [e-mail]