DATA Inc. Files Lawsuit Against Indian Company Concerning an Acquisition Agreement.

Business Editors

MONTVALE, N.J.--(BUSINESS WIRE)--October 5, 2000

DATA Inc. announced that it has filed a lawsuit in State Superior Court Docket No. BER-C-311-00, filed on Sept 26, 2000 against Polaris Software Lab Ltd, concerning an acquisition agreement.

The announcement was made by Arun Verma, President of DATA Inc.

"Polaris unilaterally and without justification", said Verma, "refused to proceed after signing an agreement on 5/23/00 to acquire DATA Inc. for $21 million in cash and stock. On our part, we have complied with all the terms and conditions of the agreement."

"Within a few weeks of signing the agreement, in several communications to us, Polaris sought to renegotiate the deal downwards, despite the fact that by any objective measure, DATA Inc. is now worth more than the purchase price originally agreed to. This was in total disregard to the interests of their shareholders, as DATA Inc. was rapidly outstripping all previous targets and this would definitely have benefited the investors. Their consistently stated desire was to substantially reduce the cash component of the consideration."

"At every step in the diligence process, DATA Inc provided all the information and took all the actions required by Polaris. We have fulfilled both the letter and the spirit of the agreement."

"We have complied fully with every step of the due diligence process. All our representations have been deemed by Polaris's auditors to be accurate. Any queries they had were answered to their satisfaction. There has been no communication to us by Polaris or their auditors to the contrary. Any review of this process will clearly show that we complied fully and faithfully in providing all documents and adhered scrupulously to all schedules."

"In an attempt to cover their true intent, Polaris requested for an audited financial statement for the first 6 months of this year, citing this technicality to be the reason that was causing delays. Although not obligated to do so, this financial statement was also prepared and made available to Polaris, as desired by them."

"We have revealed extensive confidential information to Polaris during this period, which now could seriously compromise our competitive position and as a measure of good faith, we even introduced Polaris to many of our contacts in India and paid generously for Polaris services in the USA."

"As a result, Data Inc. has incurred major expenses. Taking Polaris' assurances and commitments at face value, we also told our employees and our clients of the impending acquisition of Data Inc. by Polaris. We now face the difficult task of explaining why the acquisition will not be consummated."

Data Inc. is a strong, profitable and respected company - and growing more so steadily. We have a staff of brilliant, innovative people. We have a long and impressive list of Blue Chip clients, and revenue spread over a wide, stable base. Our revenues in 1999 were in excess of $ 9 million and in 2000, our revenues will exceed $ 16 million. More than twenty percent of our revenues are generated from "high technology", "E-Commerce" projects that are implemented in our state-of-the art data-center in Montvale, NJ. For the last few years, we have also been delivering off-shore software development services through our highly respected associates in India. We are strongly positioned in the fastest growing field in the worldwide economy. If Polaris cannot see this, and fulfill its commitments, that is their loss.

With our planned organic growth, our revenues or expected to exceed $ 28 million in the year 2001. And in the year 2002, our revenues are expected to be $ 50 million.

About Arun Verma

Arun Verma has over 28 years experience in the field of data processing spanning the areas of management, analysis, design, implementation, training and documentation of business systems. He is currently the President of Data Inc.; a software company incorporated in the state of New Jersey, USA. He holds a bachelor's degree in Engineering from India.

Arun spent his formative years in India and received his early education from the reputable Mayo College, Ajmer. Following which he was trained at India's premier defense establishments, the National Defense Academy and the Indian Military Academy. He served as an officer in the Indian Army for 12 years and then migrated to the United States in 1977 after obtaining pre-mature retirement from the Army.

From 1977 Arun worked in a software company. He then moved into the role of a consultant for major corporations in the US. In 1983, he took on the challenge of being at the helm of affairs at Data Inc., and has been responsible for managing all aspects of the company.

About Data Inc.

Data Inc. was established in 1983 as an information technology company and is headquartered in New Jersey, USA. The company offers state of the art technology solutions to a premium list of Fortune 500 clients in various sectors such as Finance, Banking, Manufacturing, Pharmaceuticals, Services and Utilities. In 1999, Data Inc. recorded a turnover of over $ 9 million. In 2000, Data Inc. will have a revenue of about $ 16 million, 20% of which will be from application development in our state-of-the-art data center in Montvale, NJ.