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Data Systems & Software Inc. Announces the Closing of the Sale of dsIT's Outsourcing Consulting Business

Posted on: Monday, 22 August 2005, 09:00 CDT

MAHWAH, N.J., Aug. 22 /PRNewswire-FirstCall/ -- Data Systems & Software Inc. (BULLETIN BOARD: DSSI) today announced that it and the other shareholders of its dsIT Technologies Ltd. subsidiary have completed the sale of dsIT's outsourcing consulting business to Taldor Computer Systems (1986) Ltd. . The sale was made pursuant to the previously announced definitive agreement entered into between Taldor and the dsIT Technologies shareholders on July 27, 2005.

Prior to the consummation of the sale, dsIT Technologies completed a spin-off of its project development and solutions activities to certain of its current shareholders. DSSI will own 80% of the entity, which will continue to conduct these activities under the name dsIT Solutions Ltd.

The transaction was structured as a sale to Taldor of all the shares of dsIT Technologies. The terms of the sale provide for an aggregate purchase price $6.0 million, of which approximately $5.65 was paid in cash and the balance by the transfer of dsIT Technologies net liabilities. Approximately $0.5 million of the cash consideration was placed in escrow and will be released to the sellers if and to the extent certain conditions set forth in the agreement are met.

At the closing, DSSI received approximately $3.5 million as its share of the gross proceeds paid at closing.

DSSI expects to file on or before August 24, 2005 a Current Report on Form 8-K, which will include additional information regarding the transaction, including proforma financial statements of DSSI reflecting the disposition of the outsourcing consulting business.

About Data Systems & Software Inc.

Data Systems & Software Inc. is a provider of software development and solution services and is an authorized direct seller and value added reseller of computer hardware. The Company's Comverge Inc. affiliate provides energy intelligence solutions to utilities.

For more information, contact: George Morgenstern, CEO, (201) 529-2026, george@dssiinc.com.

This press release includes forward-looking statements, which are subject to risks and uncertainties. Actual results may vary from those projected or implied by such forward-looking statements. The final consideration to be received by the Company in connection with the sale is subject to adjustment in accordance with the terms of the transaction and for taxes and other expenses. A discussion of risks and uncertainties which may affect the Company's business generally is included in "Business--Factors Which May Affect Future Results" in the Company's most recent Annual Report on Form 10-K as filed by the Company with the Securities and Exchange Commission.

Data Systems & Software Inc.

CONTACT: George Morgenstern, CEO of Data Systems & Software Inc.,+1-201-529-2026, george@dssiinc.com

Web site: http://www.dssiinc.com/

Source: PRNewswire-FirstCall

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