Variance to Credit Agreement

         This Variance is dated as of October 28, 1999 and is made in respect of
the  Credit  Agreement  dated  as of July  12,  1996 as  amended  and in  effect
immediately  prior to the date hereof (the "Credit  Agreement") by and among PSC
Scanning,  Inc., a Delaware  corporation  formerly known as  SpectraScan,  Inc.,
which is the successor by merger to PSC Acquisition, Inc., (the "Borrower"), PSC
Inc.  ("PSC"),  the financial  institutions  party to the Credit  Agreement (the
"Lender  Parties"),  Fleet National Bank  (formerly  known as Fleet Bank) as the
"Initial  Issuing Bank", and Fleet National Bank, as  administrative  agent (the
"Administrative  Agent")  under the Credit  Agreement.  All terms defined in the
Credit Agreement are used herein with the same meanings.

                            Statement of the Premises

         The Borrower's Total Debt Ratio,  determined according to the financial
statements of Borrower for the  quarterly  period  ending  October 1, 1999,  has
improved  from  "Level  III" to "Level  IV" as  described  under the  Applicable
Margin.  The  Borrower  has  requested  that  the  corresponding  change  in the
Applicable Margin become effective as soon as possible rather than at the end of
the current Interest Period, as provided in the Credit Agreement, and the Lender
Parties are willing to grant such variance in this specific instance.

                           Statement of Consideration

         Accordingly,  in consideration of the premises, and under the authority
of Section  5-1103 of the New York General  Obligations  Law, the parties hereto
agree as follows.

                                    Agreement

1. Variance.  Effective on the date on which the Administrative Agent shall have
received all  signatures  to this  Variance by all Lender  Parties,  PSC and the
Borrower,  the Applicable Margin shall be deemed to be at Level IV.  Immediately
upon receiving all such signatures,  the Administrative Agent shall execute this
Variance and shall notify all parties to the Credit Agreement in writing of such
effective date.

2. Effect on the Credit  Agreement.  Except as  specifically  varied above,  the
Credit  Agreement  shall remain in full force and effect and is hereby  ratified
and  confirmed.  No  obligation  to make any  similar  variance in the future is
expressed or implied.

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3.  Expenses.  The  Borrower  shall pay  promptly  when  billed  all  reasonable
out-of-pocket  expenses  of each of the Lender  Parties  and the  Administrative
Agent (including, but not limited to, reasonable fees, charges and disbursements
of counsel to each of the Lender Parties and the Administrative  Agent) incident
to this Variance.

4.  Execution in  Counterparts.  This  Variance may be executed in any number of
counterparts and by the different parties hereto on separate counterparts,  each
of which  shall be deemed to be an  original,  and all of which  taken  together
shall  constitute one and the same  agreement,  regardless of whether or not the
execution by all parties shall appear on any single counterpart.  Delivery of an
executed counterpart of a signature page to this Variance by telecopier shall be
effective as delivery of a manually executed counterpart of this Variance.

         IN WITNESS  WHEREOF,  the parties  hereto have caused a counterpart  of
this Variance to be executed and delivered by their  respective  representatives
thereunto duly authorized, as of the date first above written.


PSC Inc.                                    PSC Scanning, Inc.

By:                                         By:
Title:   Vice President, Chief Financial    Title:   Vice President and Chief
         Officer & Treasurer                         Financial Officer


Fleet National Bank, as Initial             Fleet National Bank, as
Issuing Bank                                Administrative Agent

By:                                         By:
Title:                                      Title:


Fleet National Bank                         First Union National Bank

By:                                         By:
Title:                                      Title:


The Chase Manhattan Bank                    Key Bank National Association

By:                                         By:
Title:                                      Title:

                                      -82-
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Manufacturers & Traders Trust Company

By:
Title:

                                      -83-