CSPIE Csp Inc. (MM)

BILLERICA, Mass., Feb. 27 /PRNewswire-FirstCall/ -- CSP Inc. (NASDAQ:CSPIE), a provider of IT Solutions, systems integration services and dense cluster computing systems, announced today that on February 22, 2006 it received a letter from the Nasdaq National Market notifying the Company that because the Company had failed to file with Nasdaq its quarterly report on Form 10-Q for the quarterly period ended December 31, 2005, as required by Marketplace Rule 4310(c)(14), its securities are subject to delisting from the Nasdaq Stock Market. The Company had a hearing with Nasdaq on February 16, 2006 concerning Nasdaq's prior notice of delisting, which notice we reported on Form 8-K, filed on January 23, 2006. Nasdaq advised us that the results of the hearing will be released to the Company in three to four weeks, and that the delisting action is stayed pending those results. The delay in the filing of the Form 10-Q for the first quarter of fiscal year 2006 is related to fact that the Company's 2005 Form 10-K has not yet been filed, due to the pending restatement of the consolidated balance sheet as of September 30, 2004 and statements of cash flows for the fiscal years ended September 30, 2004 and 2003. During the evaluation of the cash flow statements, certain investments, which were highly liquid and had maturities of three months or less, were identified as items that should have been reported as cash and cash equivalents at September 30, 2004 and 2003. The Company is therefore in the process of determining the impact of these restatements on the cash and cash equivalents and investments for those periods. The Company is diligently working to complete its 2005 Form 10-K, however we are still unable to predict the filing date for the 2005 Form 10-K. The Company is still assessing the need for a restatement of the balance sheets for the 2005 and 2004 quarters for the classification of certain cash and cash equivalents and investments, as well as determining the restatement of the statements of cash flows for the 2005 and 2004 quarters. About CSP Inc. Based in Billerica, Massachusetts and founded in 1968, CSP Inc. (NASDAQ: CSPIE) and its subsidiaries develop and market best-of-breed IT solutions, systems integration services, and high-performance computer systems. Its 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 System Integration segment, was 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 website at http://www.cspi.com/. To learn more about MODCOMP, Inc., please consult http://www.modcomp.com/. Contact: Gary Levine Chief Financial Officer CSP Inc. Tel: 978.663.7598 ext. 1200 Fax: 978.663.0150 First Call Analyst: FCMN Contact: DATASOURCE: CSP Inc. CONTACT: Gary Levine, Chief Financial Officer of CSP Inc., +1-978-663-7598, ext. 1200 Web site: http://www.cspi.com/ http://www.modcomp.com/

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