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ALBARA UPDATES STATUS OF LITIGATION

 CONROE, Texas, June 21 /PRNewswire/ -- Albara Corp. (NASDAQ Small-Cap Market: ALAB) announced today that the United States District Court for the Central District of California has denied an application filed by one of the company's former product suppliers, Dataproducts Corp. ("Dataproducts") seeking the mandatory turnover of all pledged collateral associated with a certain line of credit. In addition, efforts to negotiate a settlement between the parties have faltered and are unlikely to come to fruition in the near term.
 In late April, the company was served a complaint filed in United States District Court for the Central District of California by Dataproducts seeking to accelerate repayment of a line of credit which it alleges was approximately $700,000 at the time of filing. Prior to the filing, the company engaged in extensive negotiations with Dataproducts in an effort to resolve claims made by the company against Dataproducts arising from the conduct of the existing business relationship. Over the course of such negotiations, the company significantly reduced the outstanding balance of the line of credit extended to the company by Dataproducts, but has declined to make any further reductions pending the resolution of its pricing and other claims against Dataproducts. A material portion of the company's assets, including all inventory and account receivables of its subsidiary, Micro Business Solutions Inc., are pledged as collateral associated with this line of credit.
 In addition, in early May, the company was served notice that Dataproducts filed an application with the court seeking the mandatory turnover of the pledged collateral associated with the line of credit. The company contested Dataproducts' application, and in early June, the court denied Dataproducts' application.
 Also in early May, the company filed a series of counterclaims in response to the Dataproducts complaint. The counterclaims allege breach of contract and fraudulent and negligent misrepresentation by Dataproducts. The company seeks damages resulting from these counterclaims which total in excess of $1,000,000.
 In mid-May, management met with representatives of Dataproducts to initiate discussions and negotiations toward a settlement of all disputes between the two companies. Over the past month, while not conceding any liability, each party has made several proposals in an effort to find a reasonable basis for settlement. Although both parties have made some progress in moving toward a settlement, all negotiations have now stopped. Management now believes that it is unlikely that a negotiated settlement will be reached in the near term and therefore, it is unlikely the company will renew its sales of products manufactured by Dataproducts.
 Given the status of settlement negotiations, the company plans on taking a $100,000 reserve for legal expenses which could be incurred as a result of this litigation in its second quarter 1993 results. The company intends to continue to vigorously oppose Dataproducts' complaint and to prosecute is counterclaims.
 The company has two subsidiaries: Hardware That Fits and Helix Technologies. Hardware That Fits is a direct response reseller of Apple Macintosh computers and peripherals such as monitors, printers, scanners and hard drives. Hardware That Fits also sells a line of digital imaging computer products under its own brand name RealTech which offer computer users added value at competitive prices. Hardware That Fits generates the bulk of Albara's revenues and has been in operation since 1989. Helix Technologies is a developer and publisher of relational database software products for the Macintosh computer. The flagship product at Helix Technologies is Helix Express, a powerful database development environment for the Macintosh.
 The company's common stock trades on the NASDAQ Small-Cap Market under the symbol ALAB.
 -0- 6/21/93
 /CONTACT: Holly Arbuckle of Albara, 409-539-2992/
 (ALAB)


CO: Albara Corp.; Dataproducts Corp. ST: Texas IN: CPR SU:

MC -- DV002 -- 3892 06/21/93 08:04 EDT
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Publication:PR Newswire
Date:Jun 21, 1993
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