SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) March 22, 2005
DATA SYSTEMS & SOFTWARE INC.
(Exact name of Registrant as Specified in their Charter)
Delaware 0-19771 22-2786081
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(State or Other Jurisdiction (Commission file Number) (IRS Employer
of Incorporation) Identification No.)
200 Route 17, Mahwah, New Jersey 07430
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (201) 529-2026
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-2 under the Exchange Act (17 CFR
240.14a-2)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Section 1 - Registrant's Business and Operations
Item 1.01 Entry into a Material Definitive Agreement.
On March 22, 2005, the Registrant's Audit Committee and its full Board of
Directors authorized the Registrant's Databit, Inc. subsidiary to enter into a
loan agreement with Shlomie Morgenstern (the "Lender"), providing for Databit to
request advances of up to $500,000 on or before July 31, 2005. The advances
would be used to enable Databit to finance the purchase of inventory for sale to
customers. The agreement contemplates an initial advance of $250,000, which was
drawn down on March 22, 2005. Additional drawdowns are subject to the consent of
the Lender at the time of the drawdown request. Databit's obligation to pay the
principal of and interest on any and all advances is evidenced by a revolving
note payable to Shlomie Morgenstern.
Advances bear interest at a floating rate equal to the prime rate as
published in The Wall Street Journal, plus 3%. Interest is payable with the
repayment of the principal of the advance. Advances are due 30 days after
drawdown, which due date may be extended, at the option of Databit for up to an
additional 60 days. All principal of and interest on any advances must be repaid
on or before the final maturity date of August 31, 2005. Databit's obligations
under the note are secured by a security interest on Databit's accounts
receivable and inventory and a guarantee by Data Systems & Software Inc.
Shlomie Morgenstern is the President of Databit and is Vice President
-Operations of the Registrant. Shlomie Morgenstern is the son of George
Morgenstern, Chairman, President and Chief Executive Officer of the Registrant.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized on this 28th day of March 2005.
DATA SYSTEMS & SOFTWARE, INC.
By: /s/ Yacov Kaufman
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Name: Yacov Kaufman
Title: Vice-President and Chief Financial Officer