For Immediate Release

      Contact: Annmarie Gordon (860) 645-7878/email: agordon@scanoptics.com
             Susan Lucek (860) 645-7878/email: slucek@scanoptics.com


                        Scan-Optics Saddened by Death of
               Chief Financial Officer and Chief Operating Officer
                               Michael J. Villano

         Manchester,  CT - March 2, 2004 - Scan-Optics,  Inc. (OTC BB: SOCR), is
saddened to  announce  the  untimely  death of Michael J.  Villano,  Senior Vice
President, Chief Financial Officer and Chief Operating Officer. Mr. Villano died
of natural causes on Friday, February 27, 2004.

         "Mike was a friend and an important  member of our corporate family and
the loss is difficult for everyone," said James C. Mavel,  Scan-Optics' Chairman
and Chief Executive Officer. "Since joining the Company eighteen years ago, Mike
demonstrated  remarkable talent,  effort and determination.  It is impossible to
capture with words the true character,  warmth and compassion Mike exhibited day
after day, no matter how  challenging the  circumstances.  He cared deeply about
building Scan-Optics into a highly successful and respected organization. To say
that we will miss Mike does not begin to describe  how much his  friendship  has
meant to me and the people with whom he worked."

         Mr. Villano joined Scan-Optics in 1986 as Director of Accounting and in
1988 was named Assistant Controller.  In 1989 he was promoted to the position of
Controller,  in February 1992 was named Vice President and Controller,  in March
1994 was named Chief Financial  Officer and Vice President and in April 2003 was
named  Chief  Operating  Officer,   Chief  Financial  Officer  and  Senior  Vice
President.  Mr.  Villano was appointed  Treasurer in May 1997.  Prior to joining
Scan-Optics,  he was an  advanced  Staff  Auditor  at Ernst & Young from 1982 to
1986. Mr. Villano held a Bachelor's degree in Accounting from Stonehill College,
Class of 1982.

         Scan-Optics and all of its employees  extend their deepest  sympathy to
Mike's wife, Mary, and their two children, Elizabeth and Michael.

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Michael J. Villano
Page Two


         Scan-Optics,  Inc., with headquarters in Manchester,  Connecticut, is a
leader in information  capture and customer  service  solutions for  government,
insurance,  order  fulfillment,  proxy,  health  claims,  test scoring and other
paper-intensive businesses and 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 storage
and  retrieval.  Scan-Optics  systems and  software  are  marketed  worldwide to
commercial and government customers directly and through  distributors.  Through
its Manufacturing Services Division,  Scan-Optics also provides business process
outsourcing  services to customers.  Scan-Optics  has sales and service  offices
located  throughout  the United  States and abroad.  Additional  information  is
available at www.scanoptics.com.

         Statements about  Scan-Optics'  future  expectations,  including future
revenues and earnings, and all other statements in this press release other than
historical  facts  are  "forward-looking  statements"  made  under  safe  harbor
provisions of the Private Securities Litigation Reform Act of 1995 and involve a
number of risks and  uncertainties  that could materially affect future results.
Among these risk factors are changes in general economic and business conditions
in the United States and foreign  markets,  which impact capital  investments by
customers,  the cyclical  nature of funding within federal and state  government
agencies, further adverse changes in Scan-Optics' banking, lending and financing
relationship,  insufficient cash resources,  increased  competition from similar
products, the implementation of other technologies which may provide alternative
solutions,  ability to  complete  projects  in a timely  manner,  and other risk
factors  and  cautionary  statements  listed  from time to time in  Scan-Optics'
periodic  reports filed with the Securities and Exchange  Commission,  including
but not limited to the  Scan-Optics'  Annual  Report on Form 10-K for the fiscal
year ended December 31, 2002.


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