As filed with Securities and Exchange Commission on October 18, 2000
Registration No. 333-90017
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SECURITIES AND EXCHANGE COMMISSION
-------------
AMENDMENT NO. 4
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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DATA SYSTEMS & SOFTWARE INC.
(Exact name of registrant as specified in its charter)
DELAWARE 22-2786081
(State of (I.R.S. Employer
incorporation) Identification No.)
200 ROUTE 17
MAHWAH, NJ 07430
(201) 529-2026
(Address, including zip code, and telephone number,
including area code, of registrant's
principal executive offices)
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GEORGE MORGENSTERN
DATA SYSTEMS & SOFTWARE INC.
200 ROUTE 17
MAHWAH, NEW JERSEY 07430
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
COPIES TO:
SHELDON KRAUSE
EHRENREICH EILENBERG & KRAUSE LLP
11 EAST 44TH STREET
NEW YORK, NEW YORK 10017 (212) 986-9700
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Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this registration statement.
If the only securities being registered on this Form are to be offered
pursuant to dividend or interest reinvestment plans, please check the following
box. |_|
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the "Securities Act"), other than
<PAGE>
securities offered only in connection with dividend or interest reinvestment
plans, check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. |_|
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_|
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If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box.
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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Title of each class Amount Proposed maximum Proposed maximum Amount of
of securities to be to be offering price per aggregate offering registration
registered registered share price fee
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 100,000(1) $ 3.06(2) $ 306,000 $ 85.07
----------------------------------------------------------------------------------------------------------
Common Stock 20,000(1) $ 3.06(2) $ 61,200 $ 17.01
----------------------------------------------------------------------------------------------------------
Common Stock 84,794(3) $ 2.3125(4) $ 196,086 $ 51.77
----------------------------------------------------------------------------------------------------------
Total $ 153.85(5)
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</TABLE>
(1) Shares which may be sold by selling security holders following exercise of
certain outstanding warrants.
(2) Pursuant to Rule 457(g), calculated upon the basis of the exercise price of
the warrants.
(3) Shares issued upon conversion of certain convertible debentures which may
be sold by selling security holders.
(4) Pursuant to Rule 457(c), calculated on the initial filing date upon the
basis of the average of the high and low prices of the Common Stock, as
quoted through the NASDAQ National Market, on October 27, 1999.
(5) Previously paid in connection with the filing of this Registration
Statement.
<PAGE>
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The Registrant hereby amends the Registration Statement on such date or dates as
may be necessary to delay its effective date until the Registrant shall file a
further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a), may
determine
<PAGE>
The information in this prospectus is not complete and may be changed. We
may not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these Securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
PROSPECTUS
(Subject to completion, dated October 18, 2000)
DATA SYSTEMS & SOFTWARE INC.
COMMON STOCK
Certain of our security holders may offer, from time to time, shares of our
common stock. Data Systems & Software is not offering any shares.
Shares That May be Offered
This prospectus covers the resale of a total of up to 454,794 shares of our
common stock, including 84,794 shares issued to a selling security holder upon
conversion of convertible debentures and up to 370,000 shares issuable to the
selling security holders in the future upon exercise of outstanding warrants.
Method of Sale
The shares may be sold:
o through the Nasdaq Stock Market, in the over-the-counter market, in
privately negotiated transactions or otherwise;
o directly to purchasers or through agents, brokers, dealers or
underwriters; and
o at market prices prevailing at the time of sale, at prices related to
the prevailing market prices, or at negotiated prices.
Our common stock is listed on the Nasdaq National Market under the symbol
"DSSI." On June 5, 2000, the closing price of our common stock was $5.00.
Investing in our securities involves certain risks. You should consider the
"Risk Factors" beginning on page 1 in deciding whether to buy any common stock.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities, or determined if this
prospectus in truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this Prospectus is October 18, 2000.
<PAGE>
TABLE OF CONTENTS
PAGE
-----
Risk Factors....................................................... 1
Selling Security Holders........................................... 3
Use of Proceeds.................................................... 3
Plan of Distribution............................................... 3
Legal Matters...................................................... 4
Experts............................................................ 4
Where You Can Find More Information................................ 4
Information Incorporated by Reference.............................. 5
<PAGE>
RISK FACTORS
Investing in this company entails substantial risk. You should consider the
following risks and other information contained in this prospectus, information
incorporated by reference, and information which we file with the Securities and
Exchange Commission from time to time. The information in this prospectus is
complete and accurate as of this date, but the information may change after the
date of this prospectus.
GENERAL
We Have a History of Operating Losses and May Not be Able to Continue Operations
if We do Not Generate Positive Cash Flow.
We are experiencing and have in the past experienced operating losses. In 1999
and 1998, we had operating losses of approximately $5.6 million and $1.6
million, respectively. We may continue to have operating losses in 2000.
Exchange Rate Fluctuations Could Increase the Cost of our Israeli Operations.
A significant portion of our sales and expenses are in New Israeli Shekels
("NIS"). The dollar cost of our operations in Israel will be increased if the
rate of inflation in Israel is not offset (or is offset on a lagging basis) by
the devaluation of the NIS in relation to the dollar.
Loss of the Services of a Few Key Employees Could Harm Our Operations.
We depend on our key management and technical employees. The loss of certain
managers could diminish our ability to develop and maintain relationships with
customers and potential customers. The loss of technical personnel could harm
our ability meet development and implementation schedules. We have employment
contracts with some but not all of our key managerial employees, and most of our
significant employees are bound by confidentiality and non-competition
agreements. We do not maintain a "key man" life insurance policy on any of our
executives or employees.
Competition for Hiring Technical Employees Could Harm Our Business
Our future success, particularly in our consulting business, depends on our
continuing ability to identify, hire, train and retain highly qualified
technical personnel. Competition for such personnel is intense and costly. If we
fail to attract or retain highly qualified technical personnel on reasonable
terms in the future, our business could be disrupted.
Year 2000 Problems May Harm Our Business.
While we have not experienced any significant disruption in our operations
due to "Year 2000 Problems," we cannot be certain that we will not experience
such disruptions--due to internal failures or failures of our customers and/or
vendors. Our year 2000 compliance costs to date have not been material and we do
not expect them to be material. However, it is possible that we have not
identified or will not be able to correct all potential year 2000 problems, or
that our key suppliers and customers have not done so. If we or our key
suppliers or customers fail to cure any year 2000 compliance problems, our
business could be seriously harmed.
RISKS RELATED TO THE DATA COMMUNICATIONS SOLUTIONS FOR UTILITIES SEGMENT
We have made a significant investment in our utilities segment, which
develops and markets systems offering load control and two-way automated meter
reading and related data management capability to utilities. Although the
revenue base of the segment has recently improved, to date this segment has
generated limited revenue and has operated at a loss. We expect to continue our
investment in our utilities segment. The activities of this segment are subject
to many risks, including the following:
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<PAGE>
The Pace of Utility Deregulation Has Been Slow; The Ultimate Regulatory
Structure of the Utility Industry May Not Provide Mandates or Incentives to
Purchase Our Products; If the Market for Our Products Does Not Develop, Our
Business Will Not Be Profitable.
The electric utility industry is undergoing significant deregulation. Market
observers expect deregulation to include energy choice and time-of-use pricing
requirements which will mandate or favor implementation by utilities of load
control programs and the use of automated meter reading and data distribution.
However, the pace of deregulation has not been as rapid as expected and to date
only a limited number of utilities have made purchase commitments for automated
meter reading and data distribution systems. Many utilities have also deferred
the purchase of load control systems pending resolution of broader industry and
regulatory developments. The results of deregulation are uncertain and may not
result in the mandates or incentives for the types of services which require AMR
systems. If the state and federal regulation does not provide these requirements
or incentives, the market for our products may not develop as we expect.
We Must Compete With Other Utility Solutions Companies for Market Acceptance and
Customers.
While we believe that the systems offered by our utility solutions segment offer
advantages over competing load control and data communications solutions, there
are alternative solutions. Alternatives may offer lower cost, different
communication media or attractive value-added functions and services. In
addition, some of our competitors have more sales and marketing resources and/or
better brand recognition. If our potential customers do not adopt our solutions
or do so less rapidly than we expect, our future financial results and our
ability to achieve positive cash flow or profitability, will be harmed.
Our Markets are Subject to Rapid Technological Change; If We Fail to Keep Pace,
We Will Have Difficulty Developing and Maintaining a Market for Our Products and
Services
The utilities solutions market is emerging and is characterized by rapid
technological change. As the market grows and develops, we will need to invest
in continued product and/or process development in order to keep pace with
changing technologies. Our R&D efforts are focused on the technologies that we
currently believe are most promising, developing products using various
communication media. We must remain flexible and respond to the technological
developments within the industry. We may not have adequate resources to invest
in development, and our development efforts may not be successful. Future
technological advances may render our technology obsolete or less cost effective
than competitive systems.
We May Encounter Difficulties in Implementing our Technology, Products and
Services.
Problems may occur in the implementation of our technology, products or
services, and we may not successfully complete the commercial implementation of
our technology on a wide scale. Delays in full-scale product roll-out due to
revised customer specifications and/or problems in implementation and
installation are typical of implementation of systems like our load control and
gateway systems. Such delays have not caused material harm to our business in
the past. However, problems in implementation could make it difficult for us to
offer competitive services or offer appropriate new technologies on a timely
basis or on satisfactory terms.
Delays, Quality Control and Price Problems Could Arise Due to Our Reliance on
Third-Party Manufacturers of Certain Components.
We use outside parties to manufacture components of some of our products. These
manufacturers may not be able to meet our manufacturing needs in a satisfactory
and timely manner. Delays or quality control problems at our third-party
manufacturers could harm our relationships with our customers, our operating
results and cash flow. To date, we have not experienced material delays or
quality control problems from third-party manufacturers. However, our reliance
on third party manufacturers exposes us to risks that are out of our control
relating to quality control and pricing. An increase in the price or reduction
in the quality of the components produced by third party manufacturers could
harm our business.
CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in, or incorporated by reference in, this
prospectus are forward-looking in
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<PAGE>
nature. These statements can be identified by the use of forward-looking
terminology such as "believes," "expects," "may," "will," "should" or
"anticipates" or the negatives thereof or comparable terminology, or by
discussions of strategy. You are cautioned that our business and operations are
subject to a variety of risks and uncertainties and, consequently, our actual
results may materially differ from those projected by any forward-looking
statements. Certain of these risks and uncertainties are discussed above under
the heading "Risk Factors." We make no commitment to revise or update any
forward-looking statements in order to reflect events or circumstances after the
date any such statement is made.
SELLING SECURITY HOLDERS
Certain of our security holders may sell, from time to time, up to 454,794
shares of our common stock pursuant to this prospectus. The table below
identifies the selling security holders and indicates the number of shares that
each selling security holder may sell pursuant to this prospectus. If a selling
security holder transfers any of the shares shown in the table, the transferee
will be considered a selling security holder for purposes of this prospectus,
provided that (1) the transfer was a private placement and (2) the transferee is
identified in a supplement to this prospectus.
<TABLE>
<CAPTION>
Number of Shares Number of Shares
Name of Selling Security Holder Prior to Sale After Sale
---------------------- ------------- --------------
<S> <C> <C>
Bounty Investors LLC(1)................................. 184,794(2) 0(3)
Maram Stern(4).......................................... 20,000(2) 0(3)
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</TABLE>
(1) Holder of (a) 84,794 shares of common stock issued upon conversion of 0%
Convertible Subordinated Debentures and (b) warrants to purchase 100,000
shares of common stock for an exercise price of $3.06625. The warrants will
terminate if not exercised on or before October 12, 2002. Bounty Investors
LLC is a private investment fund that is owned by all of its investors and
managed by WEC Asset Management LLC, which has voting and investment
control over the shares owned by Bounty. Messrs. Ethan Benovitz, Jaime
Hartman, Nark Nordlicht and Daniel Saks are the managing members and
controlling persons of WEC Asset Management LLC.
(2) Assumes exercise of all warrants held by the named selling security holder.
(3) Assumes sale of all shares held by the selling security holder and
registered in this prospectus.
(4) Holder of shares issuable upon exercise of warrants to purchase 20,000
shares of common stock for an exercise price of $3.06625. The warrants were
issued as part of a finder's fee in connection with the issuance of certain
securities and will terminate if not exercised on or before October 12,
2002.
USE OF PROCEEDS
The shares covered by this prospectus are being offered by selling security
holders and not by us. Therefore, we will not receive proceeds from the sale of
shares. However, we will receive proceeds from the exercise of warrants. If all
the warrants are exercised, we will receive $1,195,450. We expect to use any
proceeds received upon the exercise of these warrants for working capital and
general corporate purposes.
PLAN OF DISTRIBUTION
The selling security holders may sell shares:
o through the Nasdaq Stock Market, otherwise in the over-the-counter
market, in privately negotiated transactions or otherwise;
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<PAGE>
o directly to purchasers or through agents, brokers, dealers or
underwriters; and
o at market prices prevailing at the time of sale, at prices related to
the prevailing market prices, or at negotiated prices.
If a selling security holder sells shares through agents, brokers, dealers
or underwriters, such agents, brokers, dealers or underwriters may receive
compensation in the form of discounts, commissions or concessions. This
compensation may be greater than customary compensation.
To the extent required, we will use our best efforts to file one or more
supplements to this prospectus to describe any material information with respect
to the plan of distribution not previously disclosed in this prospectus or any
material change in such information.
LEGAL MATTERS
Certain legal matters relating to the shares of common stock that may be
offered pursuant to this prospectus have been passed upon for us by Ehrenreich
Eilenberg & Krause LLP, counsel to the our company. Sheldon Krause, a partner of
Ehrenreich Eilenberg & Krause LLP, is a member of our Board of Directors and the
son-in-law of George Morgenstern, the Chairman of our Board of Directors,
President and Chief Executive Officer.
EXPERTS
The financial statements incorporated in this prospectus by reference from
our Annual Report on Form 10-K for the year ended December 31, 1999 (the "DSSI
1999 Form 10-K") have been audited by Deloitte & Touche LLP, independent
auditors, as stated in their report, which is incorporated herein by reference,
and has been so incorporated in reliance upon the report of such firm, given
upon their authority as experts in accounting and auditing.
The consolidated financial statements of Tower Semiconductor Ltd. and its
subsidiaries incorporated in this prospectus by reference from the DSSI 1999
Form 10-K have been audited by Brightman Almagor & Co. (formerly Brightman
Bar-Levav Friedman & Co.), independent auditors, as stated in their report dated
January 31, 2000, which is incorporated herein by reference, and has been so
incorporated in reliance upon the report of such firm, given upon their
authority as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Securities Exchange
Act of 1934. Accordingly, we file annual, quarterly and special reports, proxy
statements and other information with the SEC. You may read and copy any
document that we file at the SEC's public reference rooms in Washington, D.C.,
New York, New York, and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330
for further information on the public reference rooms. You can obtain copies of
our SEC filings at prescribed rates from the SEC Public Reference Section at 450
Fifth Street, N.W., Washington, D.C. 20549. Our SEC filings are also available
to you free of charge at the SEC's web site at http:www.sec.gov.
Shares of our common stock are traded on the Nasdaq National Market.
Documents we file can be inspected at the offices of the National Association of
Securities Dealers, Inc., Reports Section, 1735 K Street, N.W., Washington, D.C.
20006.
You can read and print press releases, financial statements and additional
information about us, free of charge, at our web site at http:www.dssiinc.com.
4
<PAGE>
This Prospectus is a part of a registration statement on Form S-3 filed by
us with the SEC under the Securities Act of 1993. This Prospectus does not
contain all of the information set forth in the registration statement, certain
parts of which are omitted in accordance with the rules and regulations of the
SEC. For further information with respect to us and the shares of Common Stock
offered hereby, please refer to the Registration Statement. The Registration
Statement may be inspected at the public reference facilities maintained by the
SEC at the addresses set forth above. Statements in this Prospectus about any
document filed as an exhibit are not necessarily complete and, in each instance,
you should refer to the copy of such document filed with the SEC. Each such
statement is qualified in its entirety by such reference.
INFORMATION INCORPORATED BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this Prospectus, and information that we file later
with the SEC will automatically update and supersede previously filed
information, including information contained in this Prospectus.
We incorporate by reference into this Prospectus the documents listed below
and any future filings we will make with the SEC under Sections 13(a), 13(c), 14
or 15(d) of the Exchange Act until this offering has been completed:
(1) Our Annual Report on Form 10-K for the fiscal year ended December 31,
1999, as amended by Amendment No. 1 on Form 10-K/A filed May 1, 2000;
(2) Our Quarterly Report on Form 10-Q for the three months ended March 31,
2000;
(3) Our Quarterly Report on Form 10-Q for the six months ended June 30,
2000;
(4) Our Current Report on Form 8-K filed on December 30, 1999, as amended
by Form 8-K/A filed on March 3, 2000;
(5) The description of our common stock contained in our Registration
Statement on Form 8-A, declared effective by the SEC on February 11,
1992, which was filed pursuant to Section 12 of the Exchange Act, and
any amendment or report filed for the purpose of updating such
description; and
(6) The description of our Common Stock Purchase Rights contained in our
Registration Statement on Form 8-A, dated March 22,1996, which was
filed pursuant to Section 12 of the Exchange Act, and any amendment or
report filed for the purpose of updating such description.
You may request a free copy of these documents by writing to Investor
Relations, Data Systems & Software Inc. 200 Route 17, Mahwah, New Jersey 07430,
or by calling Investor Relations at (201) 529-2026.
You should rely only on the information incorporated by reference or
provided in this Prospectus or a prospectus supplement or amendment. We have not
authorized anyone to provide you with different information. This Prospectus
does not offer these securities in any state where the offer is not permitted.
Also, this Prospectus does not offer to sell any securities other than the
securities covered by this Prospectus. You should not assume that the
information in this Prospectus or a prospectus supplement or amendment is
accurate as of any date other than the date on the front of the document.
5
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The Registrant will pay all expenses incident to the offering and sale to
the public of the shares being registered other than any commissions and
discounts of underwriters, dealers or agents and any transfer taxes. Such
expenses are set forth in the following table. All of the amounts shown are
estimates except the SEC registration fee and the Nasdaq National Market listing
fee.
SEC registration fee................................................... $1,688
NASDAQ National Market listing fee..................................... 6,000
Legal fees and expenses................................................ 15,000
Accounting fees and expenses........................................... 5,000
Miscellaneous expenses................................................. 1,000
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Total.................................................................. $28,688
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Certificate of Incorporation, as amended, and the Amended Bylaws of the
Registrant provide that the Registrant shall indemnify its officers, directors
and certain others to the fullest extent permitted by the General Corporation
Law of Delaware ("DGCL"). Section 145 of the DGCL provides that the Registrant,
as a Delaware corporation, is empowered, subject to certain procedures and
limitations, to indemnify any person against expenses (including attorney's
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with any threatened, pending or completed action,
suit or proceeding (including a derivative action) in which such person is mad a
party by reason of his being or having been a director, officer, employee or
agent of the Registrant (each, an "Indemnitee"); provided that the right of an
Indemnitee to receive indemnification is subject to the following limitations:
(i) an Indemnitee is not entitled to indemnification unless he acted in good
faith and in a manner that he reasonable believed to be in or not opposed to the
best interests of the Company, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe such conduct was unlawful and
(ii) in the case of a derivative action, and Indemnitee is not entitled to
indemnification in the event that he is judged to be liable to the Company
(unless and only to the extent that the court determines that the Indemnitee is
fairly and reasonably entitled to indemnification for such expenses as the court
deems proper). The statute provides that indemnification pursuant to its
provisions is not exclusive of other rights of indemnification to which a person
may be entitled under any bylaw, agreement, vote of stockholders or
disinterested directors, or otherwise.
Pursuant to Section 145 of the DGCL, the Registrant has purchased insurance
on behalf of its present and former directors and officers against any liability
asserted against or incurred by them in such capacity or arising out of their
status as such.
In accordance with Section 102(b)(7) of the DGCL, the Certificate of
Incorporation of the Registrant eliminates personal liability of the
Registrant's directors to the Registrant or its stockholders for monetary
damages for breach of their fiduciary duties as a director, with certain limited
exceptions set forth in Section 102(b) (7) of the DGCL.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling the Registrant
pursuant to the foregoing provisions, the Registrant has been informed that in
the opinion of the Commission such indemnification is against public policy as
expressed in the Securities Act and is therefore unenforceable.
II-1
<PAGE>
ITEM 16. EXHIBITS.
Please see Index of Exhibits on Page II-5 below.
ITEM 17. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) Securities Act of
1933 (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in the
effective Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement; PROVIDED,
HOWEVER, that paragraphs A(1)(i) and A(1)(ii) do not apply if the Registration
Statement is on Form S-3 or Form S-8, and the information required to be
included in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section 13 or Section 15(d)
of the Securities Exchange Act of 1934 (the "Exchange Act") that are
incorporated by reference in the Registration Statement;
(2) That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof;
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of
this offering.
B. UNDERTAKING REGARDING FILINGS INCORPORATING SUBSEQUENT EXCHANGE ACT DOCUMENTS
BY REFERENCE.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
C. UNDERTAKING IN RESPECT OF INDEMNIFICATION.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the
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<PAGE>
Registrant has been advised that in the opinion of the SEC such indemnification
is against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment No. 4 to
the registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the Township of Mahwah, New Jersey, on this 18th
day of October, 2000.
DATA SYSTEMS & SOFTWARE INC.
By: /s/ George Morgenstern
-------------------------
George Morgenstern
President and Chief Executive Officer
SIGNATURE TITLE
/s/ George Morgenstern Chairman, President, CEO and Director
-------------------------
George Morgenstern
/s/ Yacov Kaufman Vice President, Chief Financial Officer
-------------------------
Yacov Kaufman (Principal Financial Officer, Principal
Accounting Officer)
* Director
-------------------------
Robert Kuhn
* Director
-------------------------
Allen I. Schiff
* Director
-------------------------
Harvey Eisenberger
* Director
-------------------------
Maxwell Rabb
* Director, Secretary
-------------------------
Sheldon Krause
Director
-------------------------
Susan L. Malley
* By: /s/ George Morgenstern
Attorney-in-Fact
II-4
<PAGE>
INDEX OF EXHIBITS
Exhibit
Number Description
--------------------------------------------------------------------------------
2.1 Warrant Agreement between the Registrant and Bank Leumi USA dated as of
August 30, 1999 (incorporated herein by reference to the Registrant's Report on
Form 10-Q for the quarter ended September 30, 1999).
2.2 Securities Purchase Agreement between the Registrant and Bounty
Investors LLC, dated as of October 12, 1999, relating to the purchase and sale
of the Registrant's 0% Convertible Subordinated Debentures and Warrants,
including forms of Debentures, Warrants and Registration Rights Agreement
annexed as exhibits thereto (incorporated herein by reference to the
Registrant's Report on Form 8-K dated October 13, 1999).
2.3 Certificate of Incorporation of the Registrant, with amendments thereto
(incorporated herein by reference to Exhibit 3.1 to the Registrant's
Registration Statement on Form S-1 (File No. 33-70482)).
2.4. By-laws of the Registrant (incorporated herein by reference to Exhibit
3.2 to the Registrant's Registration Statement on Form S-1 (File No. 33-44027)).
2.5 Amendments to the By-laws of the Registrant adopted December 27, 1994
(incorporated herein by reference to Exhibit 3.3 of the Registrant's Current
Report on Form 8-K dated January 10, 1995).
5.1 Opinion of Ehrenreich Eilenberg & Krause LLP.
23.1 Consent of Deloitte & Touche LLP.**
23.2 Consent of Brightman Almagor & Co.**
23.3 Consent of Ehrenreich Eilenberg & Krause LLP (included in Exhibit
5.1).
24.1 Power of Attorney.**
** Previously filed.
II-5
