BILLERICA, MA, July 1, 2005 - CSP Inc. (Nasdaq:CSPI), a provider of IT Solutions, systems integration services and dense cluster computing systems, today announced the sale of the assets of its Scanalytics, Inc. subsidiary to Atto Bioscience, Inc. in a cash transaction valued at $453,000.

A developer of quantitative image analysis software for the life sciences and biotechnology research community, Scanalytics' software is used by research scientists in life science research institutions worldwide. Atto Bioscience, a subsidiary of Beckton, Dickinson and Company, specializes in optical instrumentation, software, and reagents for real-time analysis of interactions taking place in living cells.

CSP Chairman, President and Chief Executive Officer, Alexander R. Lupinetti said, "Although Scanalytics has expanded its software product lines and its indirect channel partner relationships, its business has become increasingly non-strategic for CSP. This transaction will allow us to focus all of our assets and energies on the MultiComputer Division and MODCOMP - CSP's core businesses - where we continue to see solid prospects for growth."

Safe Harbor
The Company wishes to take advantage of the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995 with respect to statements that may be deemed to be forward-looking under the Act. Such forward-looking statements may include, but are not limited to, those relating to the Company's continuing to see solid prospects for growth in its core businesses. The Company cautions that numerous factors could cause actual results to differ materially from any forward-looking statements made by the Company. Such risks include general economic conditions, market factors, competitive factors and pricing pressures, and others described in the Company's filings with the SEC. Please refer to the section on forward-looking statements included in the Company's filings with the Securities and Exchange Commission.

About CSP Inc.

Based in Billerica, Massachusetts and founded in 1968, CSP Inc. (NASDAQ: CSPI) and its subsidiaries develop and market best-of-breed IT solutions, image processing software, systems integration services, and high-performance computer systems. CSP's Systems segment includes the MultiComputer Division, which supplies high-performance Linux cluster systems for a broad array of defense applications, including radar, sonar and surveillance signal processing. The Company's MODCOMP, Inc. subsidiary, also part of its Service and Systems Integration segment founded in 1970 and which includes the fiscal 2003 acquisition of Technisource, is a leading provider of IT solutions and systems integration services. MODCOMP works with third parties to develop customized solutions in the global IT markets and has offices in the U.S., U.K. and Germany.

More information about CSP is available on the company's Web site at www.cspi.com

To learn more about MODCOMP, Inc., consult www.modcomp.com