Peabody, MA, March 13, 2000 - ScanSoft, Inc. (NASDAQ: SSFT) today announced that it has completed its acquisition of Caere Corp. (NASDAQ: CAER). Under the terms of the transaction, which is valued at more than $145 million, Caere's common stockholders will receive $4 in cash and $7.75 in ScanSoft common stock for each share of Caere common stock that they own.

"We are excited to welcome Caere's employees, customers, and stockholders to ScanSoft," said Michael K. Tivnan, ScanSoft's president and chief executive officer. "We look forward to combining the strengths of our companies to provide leading-edge, digital imaging software solutions to the growing base of scanner, multifunction peripheral, and digital camera users worldwide. Acquiring Caere creates a number of compelling product, technology, distribution, and strategic relationship synergies that we expect to leverage going forward. Over the next few months, we plan to begin fully integrating Caere into ScanSoft's operations, which will also enable us to realize cumulative cost savings estimated to be at least $10 million."

The combined company, which retains the ScanSoft name, will be headquartered in Peabody, MA. The company will continue to sell and support the full line of ScanSoft and Caere products, and is expected to produce revenue at an annualized rate of $100 million by the second half of 2000. The company's senior management team is composed of Paul Ricci, chairman of the Board; Michael K. Tivnan, president and chief executive officer; John J. Rogers, Jr., senior vice president and chief financial officer; Wayne Crandall, senior vice president of sales and business development; Stan Swiniarski, senior vice president of software development; Valorie Cook Carpenter, senior vice president of marketing; and Akos Reszler, senior vice president of Hungary operations.

The acquisition has been accounted for under purchase accounting and will result in a one-time charge for in-process R&D for the quarter ended March 31, 2000. Excluding one-time charges and acquisition-related costs, the transaction is expected to be immediately accretive to earnings.

About ScanSoft, Inc.

Headquartered in Peabody, MA, ScanSoft, Inc. (NASDAQ: SSFT) is a leading developer of digital imaging software that enables users to leverage the power of their scanners, digital cameras, and other electronic devices. ScanSoft's award-winning product line - Pagis Pro, TextBridge Pro, PaperPort Deluxe, Kai's Photo Soap 2, Kai's SuperGoo, Kai's Power Show, PhotoFactory, OmniPage, OmniForm, OmniForm Internet Publisher, PageKeeper, Image AXS, and Production OCR Solutions and Developer's Kits - enables users to capture, recognize, edit, manage, and share documents and photos electronically by taking advantage of ScanSoft's cutting-edge technology.

ScanSoft software is sold and marketed worldwide through retail, dealer and OEM channels and the Internet, capturing the consumer, small office/home office (SOHO) and corporate markets. There are approximately 6 million registered users of ScanSoft products. For additional information, visit www.scansoft.com.

Except for the historical information contained herein, this press release includes forward-looking statements within the meaning of Section 21(e) of the Securities Exchange Act of 1934. These statements are based on the company's current expectations and estimates as to prospective events and circumstances which may or may not be in the company's control and as to which there can be no firm assurances given. These forward-looking statements are subject to risks and uncertainties and there can be no assurance that any of these forward-looking statements may prove to be correct and actual results may differ materially. These risks and uncertainties include, but are not limited to, market acceptance of the company's products, competitive products, pricing pressures, maintenance of distribution channels, and other risks detailed from time to time in ScanSoft's SEC reports and registration statements. ScanSoft disclaims any intent or obligation to update these forward-looking statements.

Pagis, TextBridge, PaperPort, PaperPort Deluxe, PhotoFactory, Kai's SuperGoo, Kai's Photo Soap 2, Kai's Power Show, OmniPage, OmniForm, OmniForm Internet Publisher, and PageKeeper, are registered trademarks or trademarks of ScanSoft, Inc. All other trademarks are the property of their respective holders. © 2000 all rights reserved.

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