MODCOMP Opens New German Subsidiary in Frankfurt, Germany

Marks First in Strategic Expansion of German Organization

August 24, 1999, Ft. Lauderdale, FL -- MODCOMP®, Inc., a subsidiary of CSP Inc. (NASDAQ: CSPI), announced that the company's German organization, Modular Computer Systems GmbH, established a new, wholly-owned subsidiary in Frankfurt on July 1, 1999. The new company operates under the name MODCOMP Systemhaus GmbH.

MODCOMP Systemhaus GmbH is a system supplier focused on the UNIX® market and is a reseller of Hewlett-Packard® (HP®) computer systems. The new company's location in the Rhine/Main region represents a broad market area and is in close proximity to its strategic partner, Hewlett-Packard. Primary offerings include HP server products, storage area network technologies, network and system management tools, and InConcert™ workflow products. The new company's goal is to establish and grow a systems integration and network management outsourcing business in this geography like Modular System GmbH has done in the Cologne area.

Founding the new company is the first step toward further expansion of the German based MODCOMP organization. "To achieve rapid growth in each geographic sector in Germany, highly flexible operational units that function independently in the market are being established, such as MODCOMP Systemhaus GmbH," according to Waldemar Rexa, general manager of MODCOMP Systemhaus GmbH.

"To accelerate growth, Modular Computer Systems GmbH continues to form new strategic alliances with companies that serve the mission critical UNIX applications market," adds Walter Pastucha, general manager of Modular Computer Systems GmbH.

Modular Computer Systems GmbH
Based in Cologne, Germany, Modular Computer Systems GmbH, a Hewlett-Packard Value Added Reseller, is a supplier of complete enterprise-specific hardware and software technology for mission critical applications. As a solution provider for companies with a critical need for high availability systems, Modular Computer Systems GmbH offers the most scaleable solutions in the market. Modular Computer Systems GmbH is a wholly owned subsidiary of MODCOMP Inc., located in Fort Lauderdale, Florida.

MODCOMP, Inc.
Founded in 1970, MODCOMP supplies high-performance, real-time computer systems, products and services for leading worldwide industrial and government organizations for their real-time applications -- such as government/aerospace, communications, process control and industrial automation. MODCOMP systems operate in exceptionally critical and demanding applications, where reliability and real-time performance are essential.

CSP, Inc.
Based in Billerica, Massachusetts, CSP Inc., and its subsidiaries develop and market Internet software for e-commerce, image processing software and systems, systems integration and network management outsourcing, and high performance computer systems.

CSP, Inc. 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 statements under the Act. Such forward-looking statements may include, but are not limited to, statements regarding the future growth of CSP Inc., and the success of the Company's and its subsidiary's products and services. The Company cautions that numerous factors could cause actual results to differ materially from any forward-looking statements made by the Company. Please refer to the section on forward-looking statements included in the Company's Form 10-K filed November 25, 1998 with the Securities and Exchange Commission.

To learn more about CSP Inc., consult www.cspi.com.
To learn more about MODCOMP, Inc., consult www.modcomp.com.
To learn more about Scanalytics, Inc., consult www.scanalytics.com.

Corporate Headquarters:
MODCOMP, Inc.
1650 West McNab Road
Ft. Lauderdale, FL 33309-1088
Tel: +1 954 974 1380
Fax: +1 954 977 1900
E-mail: info@modcomp.com
www.modcomp.com

Germany location:
Modular Computer Systems GmbH
Oskar-JŠger-Strasse 125
D-50825 Kšln
Germany
Phone: ++02 21 / 95 44 66 - 0
E-mail: mcssec@modcomp.de
URL: www.modcomp.de

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Note to Editors: MODCOMP is a registered trademark of MODCOMP, Inc. All other product and company names mentioned herein may be trademarks and/or registered trademarks of their respective companies.

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For more information regarding this press release contact:
USA -- Ellen Rowley, PH: 954-977-1655, E-mail: rowleye@modcomp.com
Germany -- Walter Pastucha, PH: ++02 21 / 95 44 66 -0, E-mail: mcssec@modcomp.de