SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

               QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2004

                         COMMISSION FILE NUMBER 0-19771

          ------------------------------------------------------------

                          DATA SYSTEMS & SOFTWARE INC.
               (Exact name of registrant as specified in charter)

           DELAWARE                                              22-2786081
(State or other jurisdiction of                               (I.R.S. employer
incorporation or organization)                               identification no.)


   200 ROUTE 17, MAHWAH, NEW JERSEY                                 07430
(Address of principal executive offices)                          (Zip code)


                                 (201) 529-2026
               Registrant's telephone number, including area code
            -----------------------------------------------------------


     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

                  |X| Yes                       |_| No


     Indicate by check mark whether the registrant is an  accelerated  filer (as
defined in Rule 12b-2 of the Act).

                   | | Yes                      |X| No


             Number of shares outstanding of the registrant's common
                   stock, as of November 12, 2004: 8,021,691

<PAGE>

                  DATA SYSTEMS & SOFTWARE INC. AND SUBSIDIARIES

                                TABLE OF CONTENTS

PART I.  FINANCIAL INFORMATION

Item 1. Unaudited Consolidated Financial Statements

    Consolidated Balance Sheets as of December 31, 2003 and
      September 30, 2004..................................................     1

    Consolidated Statements of Operations and Comprehensive Loss
      for the nine and three month periods ended
      September 30, 2003 and 2004.........................................     2

    Consolidated Statement of Changes in Shareholders' Equity
      for the nine month period ended September 30, 2004..................     3

    Consolidated Statements of Cash Flows for the nine month periods ended
      September 30, 2003 and 2004.........................................     4

    Notes to Consolidated Financial Statements............................     6

Item 2. Management's Discussion and Analysis of Financial Condition
        and Results of Operations.........................................    11

Item 3. Quantitative and Qualitative Disclosures
        about Market Risk.................................................    15

Item 4. Controls and Procedures...........................................    15


PART II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K..................................    16

SIGNATURES................................................................    17

Certain statements contained in this report are forward-looking in nature. These
statements  are  generally  identified  by the  inclusion of phrases such as "we
expect",  "we  anticipate",  "we  believe",  "we  estimate" and other phrases of
similar meaning. Whether such statements ultimately prove to be accurate depends
upon a variety of factors that may affect our business and  operations.  Many of
these  factors are  described in our most recent  Annual  Report on Form 10-K as
filed with Securities and Exchange Commission.
<PAGE>

                  DATA SYSTEMS & SOFTWARE INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                 (in thousands, except share and per share data)

<TABLE>
<CAPTION>
                                                                    As of                     As of
                                                                 December 31,              September 30,
                                      ASSETS                        2004                      2003
                                                                   --------                 --------
Current assets:                                                                            (unaudited)
<S>                                                              <C>                      <C>
  Cash and cash equivalents                                        $  1,213                 $    896
  Restricted cash                                                       241                      241
  Accounts receivable, net                                            7,053                    6,361
  Inventory                                                              88                       87
  Other current assets                                                  661                      768
                                                                   --------                 --------

    Total current assets                                              9,256                    8,353
                                                                   --------                 --------

Investment in Comverge, net                                              68                       --
Property and equipment, net                                             814                      677
Other assets                                                            613                      540
Funds in respect of employee termination benefits                     2,379                    2,636
Goodwill                                                              4,430                    4,236
Other intangible assets, net                                            114                       85
                                                                   --------                 --------
    Total assets                                                   $ 17,674                 $ 16,527
                                                                   ========                 ========

                      LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
   Short-term bank credit and current
   maturities of long-term debt                                    $  1,517                 $  1,394
   Trade accounts payable                                             2,586                    2,315
   Accrued payroll, payroll taxes and social benefits                 1,451                    1,431
   Other current liabilities                                          2,973                    2,064
                                                                   --------                 --------
   Total current liabilities                                          8,527                    7,204
                                                                   --------                 --------
Investment in Comverge, net                                              --                    1,268
                                                                   --------                 --------

Long-term liabilities:
     Long-term debt                                                     632                      241
     Other liabilities                                                  227                       84
     Liability for employee termination benefits                      3,721                    4,088
                                                                   --------                 --------

            Total long-term liabilities                               4,580                    4,413
                                                                   --------                 --------
Minority interests                                                    1,367                    1,351
                                                                   --------                 --------
Shareholders' equity:
     Common stock - $0.01 par value per share:
       Authorized - 20,000,000 shares;
       Issued - 8,740,729 and 8,842,395 shares as of
          December 31, 2003 and September 30, 2004, respectively         87                       88
     Additional paid-in capital                                      39,595                   39,685
     Warrants                                                           461                      461
     Stock-based deferred compensation                                   --                      (64)
     Accumulated deficit                                            (33,069)                 (33,929)
      Treasury stock, at cost - 838,704 and 820,704
      shares at December 31, 2003 and
         September 30, 2004, respectively                            (3,874)                  (3,791)
     Accumulated other comprehensive loss                                --                     (159)
                                                                   --------                 --------
         Total shareholders' equity                                   3,200                    2,291
                                                                   --------                 --------
         Total liabilities and shareholders' equity                $ 17,674                 $ 16,527
                                                                   ========                 ========
</TABLE>
              The accompanying notes are an integral part of these
                  condensed consolidated financial statements.

                                      - 1 -
<PAGE>

                  DATA SYSTEMS & SOFTWARE INC. AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED)
                 (in thousands, except net loss per share data)

<TABLE>
<CAPTION>
                                                               Nine months ended            Three months ended
                                                                 September 30,                September 30,
                                                             ----------------------      ----------------------
                                                               2003          2004          2003          2004
                                                             --------      --------      --------      --------
Sales:
<S>                                                          <C>           <C>           <C>           <C>
     Products ..........................................     $ 16,900      $ 13,157      $  3,779      $  4,764
     Services ..........................................        7,306         6,831         2,327         2,141
     Projects ..........................................        2,459         2,049           564           577
                                                             --------      --------      --------      --------
           Total sales .................................       26,665        22,037         6,670         7,482
                                                             --------      --------      --------      --------

Cost of sales:
     Products ..........................................       13,951        10,801         3,202         3,887
     Services ..........................................        5,082         5,049         1,665         1,670
     Projects ..........................................        2,087         1,655           601           469
                                                             --------      --------      --------      --------
           Total cost of sales .........................       21,120        17,505         5,468         6,026
                                                             --------      --------      --------      --------
     Gross profit ......................................        5,545         4,532         1,202         1,456

Operating expenses:
   Research and development ............................          153            --            --            --
   Selling, marketing, general and administrative ......        8,345         5,496         1,982         2,168
                                                             --------      --------      --------      --------
           Total operating expenses ....................        8,498         5,496         1,982         2,168
                                                             --------      --------      --------      --------
Operating loss .........................................       (2,953)         (964)         (780)         (712)
Interest income ........................................           42            79            15             2
Interest expense .......................................         (714)         (125)          (68)          (39)
Other income (expense), net ............................         (408)          239          (243)            2
                                                             --------      --------      --------      --------
     Loss before taxes on income .......................       (4,033)         (771)       (1,076)         (747)
Taxes on income ........................................            7            17           (27)           37
                                                             --------      --------      --------      --------
Loss from operations of the Company and its consolidated
   subsidiaries ........................................       (4,040)         (788)       (1,049)         (784)
Share of losses in Comverge ............................       (1,161)       (1,066)         (611)         (382)
Gain on sale of shares in Comverge .....................           --           705            --           705
Minority interests .....................................          139           (59)           35           (11)
                                                             --------      --------      --------      --------
       Net loss from continuing operations .............       (5,062)       (1,208)       (1,625)         (472)
Net income (loss) from discontinued operations,
   net of tax ..........................................          (38)          348            (4)           --
                                                             --------      --------      --------      --------
       Net loss ........................................       (5,100)         (860)       (1,629)         (472)
                                                             --------      --------      --------      --------

Differences from translation of financial statements of
   subsidiaries ........................................           --          (159)           --            11
                                                             --------      --------      --------      --------
       Comprehensive loss ..............................     $ (5,100)     $ (1,019)     $ (1,629)     $   (461)
                                                             ========      ========      ========      ========

Basic and diluted net income (loss) per share:
  Loss per share from continuing operations ............     $  (0.66)     $  (0.15)     $  (0.21)     $  (0.06)
  Discontinued operations ..............................        (0.00)         0.04         (0.00)        (0.00)
                                                             --------      --------      --------      --------
  Basic and diluted net loss per share .................     $  (0.66)     $  (0.11)     $  (0.21)     $  (0.06)
                                                             ========      ========      ========      ========
Weighted average number of shares outstanding:
        Basic and diluted ..............................        7,680         7,927         7,894         7,936
                                                             ========      ========      ========      ========
</TABLE>

              The accompanying notes are an integral part of these
                  condensed consolidated financial statements.

                                      - 2 -
<PAGE>

                  DATA SYSTEMS & SOFTWARE INC. AND SUBSIDIARIES
      CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED)
                      NINE MONTHS ENDED SEPTEMBER 30, 2004
                                 (in thousands)
<TABLE>
<CAPTION>
                                                                                                         Accumulated
                                              Additional             Stock-Based                            Other
                          Number    Common     Paid-In                Deferred   Accumulated  Treasury  Comprehensive
                        of Shares    Stock     Capital    Warrants  Compensation  Deficit      Stock        Loss        Total
                        --------   --------    --------   --------    --------    --------    --------    --------    --------
<S>                     <C>        <C>        <C>         <C>        <C>          <C>         <C>        <C>          <C>
Balances as of
   December 31, 2003       8,741   $     87    $ 39,595   $    461    $     --    $(33,069)   $ (3,874)   $     --    $  3,200

Exercise of
  options ...........          1          *         (48)        --          --          --          83          --          35

Shares issued as
  compensation ......        100          1          70         --          --          --          --          --          71

Changes related
  to stock-based
  deferred
  compensation ......         --         --          68         --         (68)         --          --          --          --

Amortization of
  stock-based
  deferred
  compensation ......         --         --          --         --           4          --          --          --           4

Net loss ............         --         --          --         --          --        (860)         --          --        (860)

Differences from
  translation of
  subsidiaries'
  financial
  statements ........         --         --          --         --          --          --          --        (159)       (159)
                        --------   --------    --------   --------    --------    --------    --------    --------    --------

Balances as of
   September 30, 2004      8,842   $     88    $ 39,685   $    461    $    (64)   $(33,929)   $ (3,791)   $   (159)   $  2,291
                        ========   ========    ========   ========    ========    ========    ========    ========    ========
</TABLE>

*     Less than $1

              The accompanying notes are an integral part of these
                  condensed consolidated financial statements.

                                      - 3 -
<PAGE>

                  DATA SYSTEMS & SOFTWARE INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                             (dollars in thousands)

<TABLE>
<CAPTION>
                                                                                      Nine months ended September 30,
                                                                                      ------------------------------
                                                                                              2003         2004
                                                                                            -------      -------
<S>                                                                                         <C>          <C>
Cash flows used in operating activities:
     Net loss .........................................................................     $(5,100)     $  (860)
      Adjustments to reconcile net loss to net cash provided by  operating activities -
      Schedule A: .....................................................................       4,913          318
                                                                                            -------      -------
         Net cash used in operating activities ........................................        (187)        (542)
                                                                                            -------      -------
Cash flows provided by (used in) investing activities:
     Restricted cash ..................................................................       4,200           --
     Proceeds from sale of property and equipment .....................................          11           52
     Proceeds from sale of Comverge shares ............................................          --          975
     Acquisitions of property and equipment ...........................................        (193)         (99)
     Funding of termination benefits ..................................................        (243)        (257)
     Business disposition - see Schedule B ............................................      (3,527)          --
                                                                                            -------      -------
         Net cash provided by investing activities ....................................         248          671
                                                                                            -------      -------

Cash flows provided by (used in) financing activities:
     Short-term debt, net .............................................................        (503)          --
     Borrowings of long-term debt .....................................................         441           --
     Repayments of long-term debt .....................................................        (479)        (481)
     Investment in subsidiary by minority interest ....................................          22           --
     Exercise of options ..............................................................          17           35
     Purchase of treasury stock .......................................................          (2)          --
                                                                                            -------      -------
         Net cash used in financing activities ........................................        (504)        (446)
                                                                                            -------      -------
Net decrease in cash and cash equivalents .............................................        (443)        (317)
Cash and cash equivalents at beginning of period ......................................       1,150        1,213
                                                                                            -------      -------
Cash and cash equivalents at end of period ............................................     $   707      $   896
                                                                                            =======      =======
Supplemental cash flow information:
     Cash paid during period for interest .............................................     $   308      $   113
                                                                                            =======      =======
     Cash paid during period for income taxes .........................................     $   106      $    35
                                                                                            =======      =======
Non-cash investing and financing activities:
      Issuance of common stock in lieu of debt repayment ..............................     $   803
      Increase in investment in Comverge from issuance of common stock credited to
       additional paid in capital .....................................................     $ 1,085
</TABLE>

         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.

                                      - 4 -
<PAGE>

                  DATA SYSTEMS & SOFTWARE INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                             (dollars in thousands)

<TABLE>
<CAPTION>
                                                                                           Nine months ended September 30,
                                                                                           ------------------------------
                                                                                               2003             2004
                                                                                            -----------       ----------
<S>                                                                                       <C>                <C>
Schedule A:
  Adjustments to reconcile net loss to net cash (used in) provided by operating
    activities:
     Depreciation and amortization.....................................................           $447             $177
     Stock and stock-based compensation................................................             55               75
       Accretion of discount on convertible note and amortization of
                related costs and warrants.............................................            493                -
     Minority interests................................................................          (139)               59
     Share of losses in Comverge.......................................................          1,161            1,066
     Loss on write-off of stockholder's note...........................................            298                -
     Increase in liability for employee termination benefits...........................            283              367
     Exchange adjustment on long-term debt.............................................             49             (33)
     Loss (gain) on disposition of property and equipment..............................              3              (4)
     Gain on sale of Comverge shares...................................................              -            (705)
     Change in deferred taxes..........................................................          (166)              (9)
     Change in operating assets and liabilities:
         Decrease in accounts receivable and other assets..............................          4,332              658
         Increase in inventory.........................................................            326                1
         Decrease in accounts payable and other liabilities............................        (2,229)          (1,334)
                                                                                            -----------      -----------
         Total.........................................................................         $4,913            $ 318
                                                                                            ===========      ===========

 Schedule B:
    Assets and liabilities disposed of in disposition of Comverge:
       Current assets...................................................................       $4,634
       Property, equipment and other assets.............................................        1,190
       Goodwill ........................................................................          499
       Intangibles......................................................................          214
       Short-term debt..................................................................      (3,880)
       Current liabilities..............................................................      (2,340)
       Other liabilities................................................................        (517)
       Cash investment in Comverge......................................................      (3,327)
                                                                                           -----------
                                                                                             $(3,527)
                                                                                           ===========
</TABLE>

         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.

                                      - 5 -

<PAGE>

                  DATA SYSTEMS & SOFTWARE INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                             (dollars in thousands)

NOTE 1:  BASIS OF  PRESENTATION

      The  accompanying  unaudited  consolidated  financial  statements  of Data
Systems & Software Inc.  ("DSSI") and  subsidiaries  (the  "Company")  have been
prepared in accordance  with  accounting  principles  generally  accepted in the
United  States  of  America  for  interim  financial  information  and  with the
instructions to Article 10 of Regulation S-X.  Accordingly,  they do not include
all of the information and footnotes required by accounting principles generally
accepted in the United  States of America for  complete  consolidated  financial
statements.  In the opinion of management,  all adjustments considered necessary
for a fair presentation have been included. Operating results for the nine-month
period ended  September 30, 2004 are not  necessarily  indicative of the results
that may be expected  for the year ending  December 31,  2004.  These  unaudited
consolidated  financial  statements  should  be read  in  conjunction  with  the
consolidated   financial  statements  and  footnotes  thereto  included  in  the
Company's  Annual  Report on Form 10-K for the year  ended  December  31,  2003.
Certain  reclassifications  have  been  made  to the  Company's  prior  period's
consolidated   financial   statements   to  conform  to  the  current   period's
consolidated financial statement presentation.

NOTE 2: FINANCING OF OPERATIONS

      As of  September  30,  2004,  the Company  had working  capital of $1,149,
including $896 in non-restricted cash and cash equivalents. Net cash used in the
nine months of 2004 was $317. Net cash of $542 was used in operating  activities
during the first three quarters of 2004. The net loss for the nine-month  period
ended  September  30, 2004 of $860,  was due  primarily to the net loss from the
Company's   investment  in  Comverge  of  $361  and  expenses  incurred  in  the
unsuccessful  transaction with Kardan Communications Ltd. of $342. The Company's
use of cash in  operating  activities  during the first nine  months of 2004 was
primarily  for payment of accounts  payable and other  liabilities  in excess of
collections  of  trade  accounts  receivables  of  $676,  net.  Net cash of $671
provided by investing  activities,  was primarily  from the net proceeds of $975
from  the  sale by the  Company  of  preferred  shares  of its  Comverge  equity
investment,  less  amounts  used to fund  employee  termination  benefits in the
Company's  majority-owned  dsIT  subsidiary  of $257.  Net cash of $446  used in
financing activities was primarily for payment of debt of $481.

      Approximately $287 of the total working capital at September 30, 2004, was
in  dsIT.  Due to  Israeli  tax  and  company  law  constraints,  as well as the
significant  minority interest in dsIT, such working capital and cash flows from
dsIT's operations are not readily available to finance U.S. activities.

      dsIT was utilizing  approximately $859 of its $1,100 lines of credit as of
September 30, 2004.  dsIT's lines of credit are  denominated  in NIS and bear an
average interest rate of the Israeli prime rate plus 1.4% per annum. The Israeli
prime rate fluctuates and as of September 30, 2004 was 5.6%.

      The Company  intends to fund its US activities with the cash available and
anticipated  profits  from  its  US  operations.  The  Company  is  seeking  and
considering  various  restructuring,  merger  or  acquisition  and/or  financing
transactions.  Should the Company  need  additional  liquidity to finance its US
activities  and should it be  unsuccessful  in  completing a timely  transaction
providing the necessary  liquidity,  it may not have sufficient funds to finance
its US  activities.  In such event,  the Company  might need to sell  additional
Comverge shares.

                                      - 6 -

<PAGE>

                  DATA SYSTEMS & SOFTWARE INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                      (in thousands, except per share data)


Note 3: Investment in Comverge

      Comverge's  summary  results  of  operations  for the three and nine month
periods ended September 30, 2004 are as follows:

                                                 Nine months        Three months
                                                    ended              ended
                                                September 30,      September 30,
      Results of Operations                          2004               2004
                                                -------------      -------------
      Sales                                          $12,375            $ 3,774
      Gross profit                                   $ 5,057            $ 1,534
      Net loss                                       $(6,947)           $(2,707)

      The change in the Company's  Comverge  investment,  during the nine months
ended September 30, 2004 is as follows:


<TABLE>
<CAPTION>
                                                Comverge         Comverge    Net investment
                                              common stock   preferred stock   in Comverge
                                              ------------   ---------------   -----------
<S>                                           <C>            <C>               <C>
        Balances as of December 31, 2003         $(1,824)        $ 1,892         $    68
        Shares sold                                   --            (270)           (270)
        Equity loss in Comverge                       --          (1,066)         (1,066)
                                                 -------         -------         -------

        Balances as of September 30, 2004        $(1,824)        $   556         $(1,268)
                                                 =======         =======         =======
</TABLE>


      In September  2004,  the Company  signed an agreement  with certain  other
shareholders of Comverge's  Series A Preferred Stock for the sale by the Company
to other  shareholders  of  shares  of  Comverge  Series A  Preferred  Stock for
approximately  $1,000,  resulting in a gain of $705. After giving effect to this
transaction,  the Company held approximately 11% of Comverge's  preferred equity
and approximately 34% of its total equity.


      In  October  2004  Comverge  completed  the  sale of  preferred  stock  to
investors. For more detail see Note 9 - Subsequent Event.

Note 4: Goodwill

      The  entire  balance  of  goodwill  was in  the  software  consulting  and
development  segment.  There were no  acquisitions  or  impairments  of goodwill
recorded during the nine-month period ended September 30, 2004.

      The  Company's   amortizable   intangible  assets  consisted  of  software
licenses, with a gross carrying amount of $253, accumulated amortization of $163
and $139 and net balances of $90 and $114, as of September 30, 2004 and December
31, 2003,  respectively.  All intangibles  assets are being amortized over their
estimated useful lives, which averaged 5 years and the amortization  expense for
the nine  months  ended  September  30,  2003 and 2004  amounted to $59 and $24,
respectively.

Note 5: Warranty Provision

      The Company grants its customers  one-year product warranty.  No provision
was made in respect of warranties based on the Company's previous history.


                                       -7-

<PAGE>

                  DATA SYSTEMS & SOFTWARE INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                      (in thousands, except per share data)


Note 6: Stock-Based Compensation

      The Company applies  Accounting  Principles  Board Opinion ("APB") No. 25,
"Accounting  for Stock Issued to Employees" and the related  interpretations  in
accounting  for its stock option  grants to employees  and  directors,  with the
disclosure   provisions   of  SFAS  No.   123,   "Accounting   for   Stock-Based
Compensation".  Under APB No. 25,  compensation  expense is  computed  under the
intrinsic  value method of  accounting  to the extent that the fair value of the
underlying  shares on the date of the grant  exceed  the  exercise  price of the
share option, and thereafter  amortized on a straight-line  basis against income
over the expected service period.

      Had compensation cost for the Company's option plans been determined based
on the fair  value at the grant  dates of  awards,  consistent  with the  method
prescribed in SFAS No. 123, the Company's net loss and loss per share would have
been changed to the pro forma amounts indicated below:

<TABLE>
<CAPTION>
                                                          Nine months ended           Three months ended
                                                           September 30,                 September 30,
                                                           -------------                 -------------
                                                      2003            2004            2003            2004
                                                     -------         -------         -------         -------
<S>                                                  <C>             <C>             <C>             <C>
Net loss as reported ........................        $(5,100)        $  (860)        $(1,629)        $  (472)
Plus: Stock-based employee and director
       compensation expense included in
       reported net loss ....................             55              75               2              75
Less: Total stock-based employee compensation
       expense determined under fair value
       based method for all awards ..........            186             136               2              75
                                                     -------         -------         -------         -------

Pro forma net loss ..........................        $(5,231)        $  (921)        $(1,629)        $  (472)
                                                     =======         =======         =======         =======

   Net loss per share:
      Basic and diluted - as reported .......        $ (0.66)        $ (0.11)        $ (0.21)        $ (0.06)
                                                     =======         =======         =======         =======
      Basic and diluted - pro forma .........        $ (0.68)        $ (0.12)        $ (0.21)        $ (0.06)
                                                     =======         =======         =======         =======
</TABLE>

      The pro forma  information  in the above  table also  gives  effect to the
application  of  SFAS  No.  123 on  the  share  option  plans  of the  Company's
subsidiaries.

      The Company accounts for stock-based  compensation issued to non-employees
on a fair value basis in accordance  with SFAS No. 123 and EITF Issue No. 96-18,
"Accounting for Equity  Instruments  That Are Issued to Other Than Employees for
Acquiring,  or in  Conjunction  with  Selling,  Goods or  Services"  and related
interpretations.


                                       -8-

<PAGE>

                  DATA SYSTEMS & SOFTWARE INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                      (in thousands except per share data)

Note 7: Segment Information

<TABLE>
<CAPTION>
                                             Software           Energy
                                           consulting and    intelligence
                                            development       solutions        Computer
                                                (*)              (**)           hardware       Other (***)         Total
                                              --------         --------         --------         --------         --------
<S>                                        <C>               <C>               <C>              <C>              <C>
Nine months ended September 30, 2004:
   Revenues from external customers           $  8,676         $     --         $ 13,335         $     26         $ 22,037
   Intersegment revenues                            --               --               --               --               --
   Segment gross profit                          2,056               --            2,450               26            4,532
   Segment income (loss)                           208             (361)             231                6               84

Nine months ended September 30, 2003:
   Revenues from external customers           $  8,966         $  4,700         $ 12,974         $     25         $ 26,665
   Intersegment revenues                            --              284               20               --              304
   Segment gross profit                          1,931            1,313            2,276               25            5,545
   Segment loss                                   (455)          (2,772)            (247)             (17)          (3,491)

Three months ended September 30, 2004:
   Revenues from external customers           $  2,675         $     --         $  4,806         $      1         $  7,482
   Intersegment revenues                            --               --               --               --               --
   Segment gross profit                            562               --              893                1            1,456
   Segment income (loss)                            23              323              (60)              (1)             285

Three months ended September 30, 2003:
   Revenues from external customers           $  2,813         $     --         $  3,856         $      1         $  6,670
   Intersegment revenues                            --               --               --               --               --
   Segment gross profit                            548               --              653                1            1,202
   Segment loss                                    (24)            (909)            (156)             (11)          (1,100)
</TABLE>

-----------

(*)   Excludes the discontinued results of the US-based consulting  activities -
      see Note 8.

(**)  Operating  results  of  Comverge  (in the  energy  intelligence  solutions
      segment) are no longer consolidated beginning the second quarter of 2003.

(***) Represents the  operations of a VAR software  operation in Israel that did
      not meet the quantitative thresholds of SFAS No. 131.

Reconciliation of Segment Loss to Consolidated Net Loss

<TABLE>
<CAPTION>
                                                       Nine months ended             Three months ended
                                                         September 30,                  September 30,
                                                   -----------------------         -----------------------
                                                    2003            2004            2003            2004
                                                   -------         -------         -------         -------
<S>                                                <C>             <C>             <C>             <C>
Total income (loss) for reportable segments        $(3,474)        $    78         $(1,089)        $   286
Other operational segment income (loss)                (17)              6             (11)             (1)
                                                   -------         -------         -------         -------
Total operating income (loss)                       (3,491)             84          (1,100)            285

Net loss of corporate headquarters                  (1,571)         (1,292)           (525)           (757)
Discontinued operations income (loss)                  (38)            348              (4)             --
                                                   -------         -------         -------         -------
Total consolidated net loss                        $(5,100)        $  (860)        $(1,629)        $  (472)
                                                   =======         =======         =======         =======
</TABLE>

                                       -9-

<PAGE>

                  DATA SYSTEMS & SOFTWARE INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                      (in thousands except per share data)

Note 8: Discontinued Operations

      Since the latter part of 2003, the Company has not recorded  revenues from
its US-based consulting business. During the second quarter of 2004, the Company
decided to  discontinue  its  efforts to  reestablish  this  business  as it was
previously conducted. As a result, the Company recorded a gain from discontinued
operations of $348, net of tax.

      Assets and liabilities of the discontinued operation were as follows:

<TABLE>
<CAPTION>
                                                  December 31, 2003   September 30, 2004
                                                  -----------------   ------------------
<S>                                               <C>                 <C>
Current assets .............................            $  2                $ --
                                                        ====                ====
Fixed assets ...............................            $  2                $ --
                                                        ====                ====
Current liabilities ........................            $729                $ --
                                                        ====                ====
</TABLE>

      Profit and loss of the discontinued  operations within consulting  segment
were as follows:

<TABLE>
<CAPTION>
                                            Nine months ended          Three months ended
                                               September 30,              September 30,
                                               -------------              -------------
                                            2003          2004         2003           2004
                                            ----          ----         ----           ----
                                          Restated                   Restated
                                          --------                   --------
<S>                                        <C>           <C>           <C>           <C>
Sales ...............................      $ 172         $  --         $  14         $--
Cost of sales .......................        154            --            13          --
                                           -----         -----         -----         ---
Gross profit ........................         18            --             1          --
                                           -----         -----         -----         ---
Loss from operations ................        (31)           (2)           (1)         --
Interest expense ....................          7             4             3          --
                                           -----         -----         -----         ---
Net income (loss) from discontinued
    operations ......................      $ (38)        $ 348         $  (4)        $--
                                           =====         =====         =====         ===
</TABLE>


Note 9: Subsequent Event

      In  October  2004,  Comverge  closed on the sale of  additional  preferred
equity financing in the amount of $13,600. The preferred equity is senior to the
preferred  stock of  Comverge  owned by the  Company.  This  round of  financing
diluted the  Company's  holdings to  approximately  7% of  Comverge's  preferred
equity and approximately 25% of its total equity.

                                     - 10 -
<PAGE>

                          DATA SYSTEMS & Software Inc.
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

      The following  discussion  includes statements that are forward-looking in
nature.  Whether such statements  ultimately prove to be accurate depends upon a
variety of factors that may affect our business and operations. Certain of these
factors are discussed  below under "Factors That May Influence  Future  Results"
and in "Item 1.  Description  of  Business-Factors  That  May  Influence  Future
Results" in our Annual Report on Form 10-K for the year ended  December 31, 2003
(the "2003 10-K").

OVERVIEW AND TREND INFORMATION

      During  the  periods  included  in  this  report,  we  operated  in  three
reportable  segments:  software consulting and development,  energy intelligence
solutions, and computer hardware. The following analysis should be read together
with  the  segment  information  provided  in  Note 7 to the  interim  unaudited
consolidated  financial  statements  included in this  quarterly  report,  which
information is hereby incorporated by reference into this Item 2.

      SOFTWARE CONSULTING AND DEVELOPMENT

      Segment  revenues  continued  to  decrease  in the third  quarter of 2004,
primarily  as a result of the  decreasing  backlog  of fixed  price  development
projects.  We continue to invest significant  marketing efforts to introduce and
increase the visibility our products and expertise,  including our participation
in the MarketReach  America  program,  introducing our diver detection and sonar
system  (DDS) for  protecting  critical  coastal  and  offshore  sites to the US
Homeland Security market.

      ENERGY INTELLIGENCE SOLUTIONS

      In October 2004,  Comverge completed its latest round of equity financing,
raising  approximately  $13.6 million.  These funds will  facilitate  Comverge's
ability to enter into  additional  fourth  Virtual  Peaking  Capacity TM ("VPC")
programs.  DSSI did not participate in this round of finance, which included the
existing investors and new investors, and as a result our equity in Comverge was
diluted to approximately 7% of Comverge's preferred equity and approximately 25%
of its total equity.

      COMPUTER HARDWARE

      Sales in the third  quarter of 2004  continued to increase and were higher
than the previous quarter and the third quarter of 2003. However,  this increase
was from our traditional computer hardware VAR activity.  The sales in this area
are very  competitive and difficult to forecast.  Databit is making  significant
efforts  in order to  increase  its sales in other  areas such as WiFi and other
network, integrated hardware and software areas.

      CORPORATE

      Starting the beginning of this year, our Chief  Executive  Officer retired
from full-time  employment,  although at the Board's request he continues to act
as CEO as a consultant, under the terms of his employment agreement.

RECENT DEVELOPMENT

      As of September 30, 2004 our  shareholders  equity was $2.3 million,  $0.2
million short of the $2.5 million minimum required for continued  listing on The
Nasdaq  SmallCap  Market.  As a result,  our securities may be delisted from The
Nasdaq  Stock  Market.  We intend to  present  to Nasdaq  our plan to regain and
maintain compliance with the minimum shareholders equity requirement.  There can
be no assurance  that we will be able to maintain the listing for our securities
on the Nasdaq Stock Market.


                                     - 11 -
<PAGE>

Results of Operations

      The  following  table sets forth certain  information  with respect to the
unaudited  consolidated  results of  operations of the Company for the three and
nine month periods ended  September 30, 2003 and 2004,  including the percentage
of total revenues during each period  attributable to selected components of the
operations  statement  data and for the period to period  percentage  changes in
such components. Begining the second quarter of 2003 we do not fully consolidate
Comverge's  results of  operations,  but include  such results them on an equity
basis,  the results of the nine month periods  presented are therefore not fully
comparable.

<TABLE>
<CAPTION>
                                                    Nine months ended September 30,
                                      ----------------------------------------------------------
                                              2003                      2004             Change
                                      --------------------     --------------------     --------
                                                   % of                      % of         % of
                                      ($,000)      sales        ($,000)      sales        2003
                                      --------    --------     --------    --------     --------
<S>                                   <C>         <C>          <C>         <C>          <C>
Sales                                 $ 26,665         100%    $ 22,037         100%         -17%
Cost of sales                           21,120          79       17,505          79          -17
                                      --------    --------     --------    --------     --------

           Gross profit                  5,545          21        4,532          21          -18
R&D expenses                               153           1           --           0         -100
SMG&A expenses                           8,345          31        5,496          25          -34
                                      --------    --------     --------    --------     --------

          Operating loss                (2,953)        (11)        (964)         (4)         -67
Interest expense, net                     (672)         (3)         (46)          0          -93
Other income (loss), net                  (408)         (2)         239           1         -159
                                      --------    --------     --------    --------     --------

Loss before taxes on income             (4,033)        (15)        (771)         (3)         -81
Taxes on income                              7           0           17           0          143
                                      --------    --------     --------    --------     --------

Loss from operations of the             (4,040)        (15)        (788)         (4)         -80
   Company and its
   consolidated
   subsidiaries
Share of losses in Comverge             (1,161)         (4)      (1,066)         (5)          -8
Gain on sale of share in Comverge           --          --          705           3
Minority interests                         139           1          (59)          0         -142
                                      --------    --------     --------    --------     --------

Net loss from
  continuing operations                 (5,062)        (19)      (1,208)         (5)         -76

Net income (loss) from
   discontinued operations,
   net of tax                              (38)          0          348           2       -1,016
                                      --------    --------     --------    --------     --------
Net loss                              $ (5,100)        (19%)   $   (860)         (4)%       -83%
                                      ========    ========     ========    ========     ========
</TABLE>

<TABLE>
<CAPTION>
                                                    Three months ended September 30,
                                      ----------------------------------------------------------
                                             2003                      2004              Change
                                      --------------------     --------------------     --------
                                                    % of                   % of           % of
                                       ($,000)      sales      ($,000)     sales         2003
                                      --------    --------     --------    --------     --------
<S>                                   <C>         <C>          <C>         <C>          <C>
Sales                                 $  6,670         100%    $  7,482         100%          12%
Cost of sales                            5,468          82        6,026          81           10
                                      --------    --------     --------    --------     --------

           Gross profit                  1,202          18        1,456          19           21
R&D expenses                                --          --           --           0
SMG&A expenses                           1,982          30        2,168          29            9
                                      --------    --------     --------    --------     --------

          Operating loss                  (780)        (12)        (712)        (10)          -9
Interest expense, net                      (53)         (1)         (37)          0          -30
Other income (loss), net                  (243)         (4)           2           0         -101
                                      --------    --------     --------    --------     --------

Loss before taxes on income             (1,076)        (16)        (747)        (10)         -31
Taxes on income                            (27)         (0)          37           0         -237
                                      --------    --------     --------    --------     --------

Loss from operations of the             (1,049)        (16)        (784)        (10)         -25
   Company and its
   consolidated
   subsidiaries
Share of losses in Comverge               (611)         (9)        (382)         (5)         -37
Gain on sale of share in Comverge           --          --          705           9
Minority interests                          35           1          (11)          0         -131
                                      --------    --------     --------    --------     --------

Net loss from
  continuing operations                 (1,625)        (24)        (472)         (6)         -71

Net income (loss) from
   discontinued operations,
   net of tax                               (4)          0           --           0         -100
                                      --------    --------     --------    --------     --------
Net loss                              $ (1,629)        (24)    $   (472)         (6)%       -71%
                                      ========    ========     ========    ========     ========
</TABLE>

      Sales. The decrease in sales in the first nine months of 2004, as compared
to the same period in 2003,  was due the inclusion of  Comverge's  sales of $4.7
million in the first quarter of 2003;  commencing the second quarter of 2003, we
no longer consolidated Comverge's operations. The increase in sales in the third
quarter of 2004 was due to a $1 million  increase  in computer  hardware  sales,
which was partially offset by a $0.1 million decrease in software consulting and
development  sales.  The increase in computer  hardware sales was from Databit's
existing  customers.  The decrease in software  consulting and development sales
was due a decrease in development project revenues.

      Gross  profit.  The decrease in gross  profits in the first nine months of
2004 as compared to the same period in 2003, was  attributable  to the inclusion
of Comverge's  gross profit of $1.3 million in the first  quarter of 2003.  This
decrease  was net of an  increase  in gross  profit in both of our  consolidated
segments.  In the third quarter of 2004,  gross profit and gross profit  margins
increased in both operating segments, compared to the third quarter of 2003.

      Selling,  marketing,  general and administrative  expenses ("SMG&A").  The
decrease  in SMG&A in the first nine  months of 2004 as compared to SMG&A in the
first nine months of 2003, was  attributable  to the fact that SMG&A in the 2003
period included $2.2 million of Comverge's SMG&A and since the second quarter of
2003, we no longer consolidate Comverge's operations.  The remaining decrease in
SMG&A was due to decreased corporate G&A and a decrease in SMG&A in our software
consulting and development  segment.  The increase in SMG&A in the third quarter
of 2004 as compared to third quarter of 2003, was primarily due to  professional
fees incurred in connection with the contemplated transaction with Kardan, which
was discontinued by Kardan in the third quarter of 2004.

                                     - 12 -
<PAGE>

      Share of losses in  Comverge.  The equity  loss in the third  quarter  and
first nine months of 2004 was attributable to our investment in Comverge,  whose
results we account for on an equity basis as of the second  quarter of 2003. Our
share of  Comverge's  net loss of $2.7  million and $6.9  million,  in the third
quarter  and first  nine  months of 2004,  was $0.4  million  and $1.1  million,
respectively.  Comverge's increased losses during the 2004 periods was primarily
due to  increased  SMG&A  expenses,  primarily  attributable  to  the  marketing
expenses  associated  with its new VPC  programs  and the  deferral  of revenues
pending the completion of certain test to be performed within these programs.

      Gain on sale of shares in Comverge.  During the third  quarter of 2004, we
sold a portion of our  investment  in  Comverge,  as a result  which we recorded
income of approximately $0.7 million.

      Other  income.  During the second  quarter of 2004, we received a decision
from the Israeli  Supreme  Court in our  dispute  with an Israeli  bank.  In its
decision,  the Court  reversed the district  court's award for costs in favor of
the bank for which we had had  previously  accrued.  The courts also remanded to
the district  court our claims  against the bank for a  determination  as to the
amount of  damages.  As a result of the  decision we  recorded  other  income of
approximately $0.2 million.

      Discontinued  operations.  Since  the  latter  part of  2003,  we have not
recorded  revenues  from our US based  consulting  business.  During  the second
quarter of 2004,  we decided to  discontinue  our  efforts to  reestablish  this
business as it was previously  conducted.  As a result,  we recorded a gain from
discontinued operations of $0.3 million.

Liquidity and Capital Resources

      As of  September  30,  2004,  we had  working  capital  of  $1.1  million,
including $0.9 million in  non-restricted  cash and cash  equivalents.  Net cash
used in the first  three  quarters  of 2004 was $0.3  million.  Net cash of $0.5
million was used in  operating  activities  during the first  three  quarters of
2004.  The net loss for the nine-month  period ended  September 30, 2004 of $0.9
million, resulted primarily from the net loss from our investment in Comverge of
$0.4 million and expenses  incurred in the unsuccessful  transaction with Kardan
of $0.3 million. We used cash in our operating activities during the first three
quarters  of 2004  primarily  for the  payment  of  accounts  payable  and other
liabilities  in excess of  collections  of trade  accounts  receivables  of $0.7
million,  net. The net cash of $0.7 million provided by investing activities was
primarily  related to the net proceeds received from the sale of Comverge shares
of $1.0 million less the funding employee  termination benefits of $0.3 million.
Net cash of $0.5 million used in financing  activities was primarily for the net
payment of debt.  Of the total  working  capital at  September  30,  2004,  $0.3
million  was in our  majority-owned  dsIT  subsidiary.  Due to  Israeli  tax and
company law  constraints as well as the significant  minority  interest in dsIT,
such  working  capital  and cash flows from  dsIT's  operations  are not readily
available to finance U.S. activities.

      As of October 31, 2004 our wholly  owned US  operations  (i.e.,  excluding
dsIT and  Comverge)  had an aggregate of $0.9 million in  unrestricted  cash and
cash  equivalents,  reflecting  a $0.2 million  decrease  from the balance as of
December 31, 2003.

      We intend to fund our US operations and corporate activities with the cash
available and anticipated profits from our US operations. Based on our operating
plans, we believe that we have sufficient liquidity to finance our US operations
and corporate  activities for at least the 12 months  following the date of this
report.  There is,  however,  no  assurance  that we will be able to operate our
business and  activities  as planned.  We continue to seek and consider  various
restructuring,  merger or acquisition and/or financing  transactions which would
increase shareholders equity and provide additional liquidity. Should we require
additional  liquidity  and  should we be  unsuccessful  in  completing  a timely
transaction providing the necessary liquidity,  we may not have sufficient funds
to finance  our US  activities.  In such event,  we may need to sell  additional
Comverge shares in order to finance our US activities.


                                     - 13 -
<PAGE>

Contractual Obligations and Commitments

      Our  contractual  obligations  and  commitments  at  September  30,  2004,
excluding certain severance  arrangements  described below,  principally include
obligations  associated  with  our  outstanding  indebtedness,   future  minimum
operating lease obligations and contractual  obligations to our CEO for payments
for his post-retirement consulting services to us, are as set forth in the table
below.

<TABLE>
<CAPTION>
                                                        Cash Payments Due During the Year Ending September 30,
                                                    --------------------------------------------------------------
                                                                        (amounts in thousands)
      Contractual Obligations                        Total         2005          2006          2007       After 2007
      -----------------------                       ------        ------        ------        ------        ------
<S>                                                 <C>           <C>           <C>           <C>              <C>
Long-term debt related to Israeli operations        $  777        $  535        $  179        $   63           $--

Guarantees                                             410           410            --            --            --

Operating leases                                     2,825         1,084           606           422           713

Consulting agreement with CEO                        1,127            --         1,127            --            --
                                                    ------        ------        ------        ------        ------

Total contractual cash obligations                  $5,139        $2,029        $1,912        $  485        $  713
                                                    ======        ======        ======        ======        ======
</TABLE>


      We expect to finance these  contractual  commitments from cash on hand and
cash generated from operations.

      Under the terms of his employment agreement with us, we have an obligation
to pay our Chief  Executive  Officer  consulting  fees over a seven-year  period
starting January 1, 2004. During the first four years of the consulting  period,
we have to pay our CEO $237,000  per year,  equal to 50% of his salary in effect
as of December 31, 2003.  During the last three years of the consulting  period,
we must pay $119,000 per year, equal to 25% of that salary. In addition, we must
make contributions to a non-qualified defined contribution retirement plan equal
to 25% of the  consulting  fee and  continue  benefits as provided for under his
employment  agreement.  Under  the  terms of the  employment  agreement,  we are
obligated to fund the amounts  payable for the term of the consulting  period by
the purchase of an annuity or similar investment product at the beginning of the
consulting  period.  The CEO has  agreed to forgo the  commitment  of  immediate
funding for the next 12 months or until we acquire additional funding.

      Our Israeli subsidiaries provided various performance,  advance and tender
guarantees as required in the normal course of its  operations.  As at September
30, 2004, such guarantees totaled approximately  $422,000 and were due to expire
through October 2005.

                                     - 14 -

<PAGE>

Item 3. Quantitative and Qualitative Disclosures About Market Risk

      In the  normal  course of  business,  we are  exposed to  fluctuations  in
interest  rates on  lines-of-credit  and long-term  debt incurred to finance our
operations in Israel,  currently  $0.9 million and $0.5  million,  respectively.
Additionally,   our  monetary   assets  and   liabilities   (net   liability  of
approximately  $0.9 million) in Israel are exposed to  fluctuations  in exchange
rates.  We do not  employ  specific  strategies,  such as the use of  derivative
instruments or hedging, to manage our interest rate or foreign currency exchange
rate exposures.


Item 4. Controls and Procedures

Evaluation of Controls and Procedures

      Within 90 days prior to the date of filing of this report,  we carried out
an  evaluation,  under  the  supervision  and  with  the  participation  of  our
management,  including  the Chief  Executive  Officer  and the  Chief  Financial
Officer,  of the design and operation of our disclosure controls and procedures.
Based on this  evaluation,  our Chief  Executive  Officer  and  Chief  Financial
Officer concluded that our disclosure  controls and procedures are effective for
gathering,  analyzing and disclosing the information we are required to disclose
in the reports we file under the  Securities  Exchange  Act of 1934,  within the
time periods specified in the SEC's rules and forms.

Changes in Controls and Procedures

      There have been no  significant  changes in our  internal  controls  or in
other factors that could  significantly  affect internal controls  subsequent to
the date of our most recent evaluation.


                                     - 15 -

<PAGE>

                           PART II - Other information

Item 6: Exhibits and Reports on Form 8-K

      (a)   Exhibits

            10.1  Employment Agreement executed on August 19, 2004 and effective
                  as  of  January  1,  2004  between   Databit   Inc.,   Shlomie
                  Morgenstern and the Registrant.

            10.2  Restricted Stock Award Agreement, dated as of August 19, 2004,
                  between the Registrant and Shlomie Morgenstern.

            10.3  Stock Option  Agreement  dated as of August 19, 2004,  between
                  the Registrant and Shlomie Morgenstern.

            10.4  Second   Amended  and  Restated   Co-Sale  And  First  Refusal
                  Agreement dated as of October 26, 2004, by and among Comverge,
                  Inc., the Registrant, and other persons party thereto.

            31(a) Rule 13a-14(a) Certification by Chief Executive Officer

            31(b) Rule 13a-14(a) Certification by Chief Financial Officer

            32(a) Section 1350 Certification by Chief Executive Officer *

            32(b) Section 1350 Certification by Chief Financial Officer *

-----------------

* A signed original of this written statement required by Section 906 has been
provided to the Company and will be retained by the Company and furnished to the
Securities and Exchange Commission or its staff upon request.


(b)   Reports on Form 8-K

      (i) Report on Form 8-K,  filed on July 28, 2004  (earliest  event reported
      July 26, 2004): Item 5 was reported.

      (ii) Report on Form 8-K, filed on August 13, 2004 (earliest event reported
      August 13, 2004): Item 2 was reported.

      (iii)  Report  on Form 8-K,  filed on  August  17,  2004  (earliest  event
      reported August 13, 2004): Item 7 was reported.

      (iv) Report on Form 8-K, filed on August 19, 2004 (earliest event reported
      August 18, 2004): Item 5 was reported.

      (v)  Report on Form 8-K,  filed on  September  10,  2004  (earliest  event
      reported September 9, 2004): Item 1.01 was reported.


                                     - 16 -

<PAGE>

                                   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 its
Principal Financial Officer thereunto duly authorized.



                                         DATA SYSTEMS & SOFTWARE INC.

Dated:  November 12, 2004

                                  By: /s/ YACOV KAUFMAN
                                      ---------------------------------
                                      Yacov Kaufman
                                      Vice President and Chief Financial Officer

                                     - 17 -