Scan-Optics, Inc. Announces Order from Northrop Grumman Corp.

MANCHESTER, Conn.--(BUSINESS WIRE)--Nov. 5, 1998--Scan-Optics, Inc. (Nasdaq National Market:SOCR), a leader in high performance document imaging systems, information management solutions and associated hardware and software services, today announced that it has received a $1.7 million order from Northrop Grumman, the systems integrator for the IRS SCRIPS project, for upgrades to the 19 scanning and tax processing systems used in the project.

The IRS uses Scan-Optics' Series 9000 systems to process tax returns for regional offices around the country. The upgrades will include the latest quality monitor, hardware and software, digital cameras, and JBIG encoders, and are intended to enhance the systems to state-of-the-art technology, enabling the IRS to improve its service to taxpayers across the United States.

According to Jim Gander, Program Director on the SCRIPS Project, "We are pleased to have the opportunity to make this important enhancement to the system by upgrading all the Scan- Optics scanners on our program."

Richard C. Goyette, Vice President of Sales and Marketing for Scan-Optics stated, "We are delighted to be partnering with Northrop Grumman and the Internal Revenue Service again, and appreciate their confidence and continued support of our technology."

Through its Logicon subsidiary based in Herndon, Virginia, Northrop Grumman is a major provider of advanced technology systems and services to support national security and industrial needs, and information technology systems and solutions for government and commercial customers.

Scan-Optics, Inc., with headquarters in Manchester, Connecticut, is recognized internationally as an innovator and solution provider in the information management and imaging business. It designs, manufactures and services products and systems for character recognition, image processing and display, data capture, data entry, and multi-user business computers. Scan-Optics' systems and software are marketed worldwide to commercial and government customers directly and through distributors. The Company has sales and service offices located throughout the United States and abroad.