For Immediate Release
Contact: Dr. E. Ted Prince
INSCI Corp
(508) 870-4015

INSCI Corp Announces Financial Results for Fiscal Year 1996

WESTBOROUGH, MA - JULY 3, 1996 - INSCI Corp (NASDAQ: INSI) today announced its results for the fourth quarter of fiscal year 1996 and for its fiscal 1996 year.

Revenue for the fourth quarter was $2,841,000 compared with revenue of $2,262,000 in the same quarter of the preceding year, an increase of 26%. There was a net profit of $41,000 in the fourth quarter. This was after a one-time charge of $75,000. This compares with a net profit of $431,000 in the same quarter of the preceding year. However, the profit in the year-ago quarter was part of a yearly loss of $3,113,000 and therefore was not representative of the Company's financial results for the previous fiscal year.

The fourth quarter of the year saw significant announcements including the acquisition of a new product line, Image Express from Custom Solutions, Inc., as well as the acquisition of Courtland Group, Inc. of Columbia, Maryland. The Company also signed marketing agreements with Xerox Corp., NEPS, Inc., a subsidiary of Moore Business Systems, and with Datawatch, Inc., and announced two new products developed by the company, COINS/CD for the Windows NT operating system and SetUp Expert, an application generator.

For the fiscal year 1996 revenue increased 10% and the net loss decreased by 53%. There was a net loss of $1,452,000 for the fiscal year 1996 on revenue of $7,913,000. This compares with a net loss of $3,113,000 in the preceding year on revenue of $7,188,000. Fourth quarter revenue was the highest ever achieved by the Company. Although for the year as a whole there was an operating loss, there were earnings before non-recurring charges in the last three quarters, attributable to management and operational changes undertaken in the first quarter of the year.

According to Dr. E. Ted Prince, Chairman, President and CEO, “We are very pleased with the progress that has been achieved this year. The Company has achieved profitability, significantly increased its sales, entered into a number of significant marketing agreements and has been recognized by market analysts as having the leading product in the high performance segment of the client server market for electronic printing and archiving solutions for corporations. We have broadened our product line and have therefore become a more attractive vendor to corporations who increasingly require one-stop shopping for enterprise document management solutions. We believe the stage is set for a very successful coming year.”

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INSCI Corp develops, markets, and supports client/server electronic printing and document management software utilizing optical disk and CD storage technology to index, archive, retrieve, and distribute computer-generated documents and scanned images including statements, reports, invoices, and transaction data. INSCI also sells print-on-demand software for the automated document factory market. The Company provides customers with an extensive range of system integration and consulting services based upon its expertise in integrated output management, electronic printing, print-on-demand, data storage, data warehousing and data mining. The Company is headquartered in Westborough, Massachusetts. For more information about INSCI Corp, visit its home page on the Internet at http://www.insci.com.

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FINANCIAL SUMMARY

(in thousands, except per share amounts)

For Fiscal Years Ended March 31,

(in thousands, except per share amounts)

For Quarter Ended March 31,