UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
12b-25
NOTIFICATION
OF LATE FILING
SEC
FILE
NUMBER: 0-19771
CUSIP
NUMBER: 237887104
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(Check One):
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o
Form
10-K |
o
Form 20-F |
o
Form 11-K |
x
Form
10-Q |
o
Form 10-D |
o
Form N-SAR |
o
Form N-CSR |
For
Period Ended: September 30, 2007
o
Transition Report on Form
10-K
o
Transition Report on Form
20-F
o
Transition Report on Form
11-K
o
Transition Report on Form
10-Q
o
Transition Report on Form
N-SAR
For
the
Transition Period Ended:
Read
Instruction (on back page) Before Preparing Form. Please Print or
Type.
Nothing
in this form shall be construed to imply that the Commission has verified
any
information contained herein.
If
the
notification relates to a portion of the filing checked above, identify the
Item(s) to which the notification relates:
PART
I -- REGISTRANT INFORMATION
ACORN
FACTOR, INC.
Full
Name
of Registrant
DATA
SYSTEMS AND SOFTWARE INC.
Former
Name if Applicable
4
West Rockland Road
Address
of Principal Executive Office (Street
and Number)
Montchanin,
Delaware 19710
City,
State and Zip Code
PART
II -- RULES 12b-25(b) AND (c)
If
the
subject report could not be filed without unreasonable effort or expense
and the
registrant seeks relief pursuant to Rule 12b-25(b), the following should
be
completed. (Check box if appropriate)x
(a)
The
reason described in reasonable detail in Part III of this form could not
be
eliminated without unreasonable effort or expense;
(b)
The
subject annual report, semi-annual report, transition report on Form 10-K,
Form
20-F, Form 11-K, Form N-SAR or Form N-CSR, or portion thereof, will be filed
on
or before the 15th calendar day following the prescribed due date; or the
subject quarterly report or transition report on Form 10-Q, or subject
distribution report on Form 10-D, or portion thereof, will be filed on or
before
the fifth calendar day following the prescribed due date; and
(c)
The
accountant's statement or other exhibit required by Rule 12b-25(c) has been
attached if applicable.
PART
III -- NARRATIVE
State
below in reasonable detail the reasons why the Form 10-K, 20-F, 11-K, 10-Q,
10-D, N-SAR, N-CSR, or the transition report or portion thereof, could not
be
filed within the prescribed time period. (Attach Extra Sheets if Needed):
The
registrant was not able to file its Quarterly Report on Form 10-Q within
the
prescribed time period because it has experienced delays in the collection,
analysis and disclosure of certain information required to be included in
(or
otherwise necessary in connection with) the preparation and filing of the
Form
10-Q. The Form 10-Q will be filed as soon as reasonably practicable and in
no
event later than the fifth calendar day following the prescribed due
date.
PART
IV -- OTHER INFORMATION
(1)
Name
and telephone number of person to contact in regard to this
notification
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Michael
Barth
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302
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656-1707
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(Name)
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(Area
Code)
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(Telephone
Number)
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(2)
Have
all other periodic reports required under Section 13 or 15(d) of the Securities
Exchange Act of 1934 or Section 30 of the Investment Company Act of 1940
during
the preceding 12 months or for such shorter period that the registrant was
required to file such report(s) been filed? If answer is no, identify report(s).
x Yes o
No
(3)
Is it
anticipated that any significant change in results of operations from the
corresponding period for the last fiscal year will be reflected by the earnings
statements to be included in the subject report or portion thereof? x Yes o
No
If
so,
attach an explanation of the anticipated change, both narratively and
quantitatively, and, if appropriate, state the reasons why a reasonable estimate
of the results cannot be made.
Set
forth
below is preliminary consolidated results of operations data for Acorn Factor,
Inc. (the "Company" or “us”) for the quarter and nine months ended September 30,
2007 and comparative data for the same periods in 2006.
The
Company had a net loss of $1.4 million and net income of $10.5 million for
the
quarter and nine months ended September 30, 2007, respectively, as compared
to a
net loss of $1.7 and $5.3 million for the quarter and nine months ended
September 30, 2006. Net loss for the quarter ended September 30, 2007 included
a
non-cash gain of $0.5 million with respect to the private placement of Paketeria
and a non-cash finance expense of $0.6 million recorded with respect to the
Company's private placement of Debentures in March and April, 2007. Net income
for the nine months ended September 30, 2007 included non-cash gains of $16.2
million with respect to the second quarter public offering of Comverge and
of
$0.5 million with respect to the recent private placement of Paketeria and
a
non-cash finance expense of $2.5 million recorded with respect to the private
placement of Debentures.
Sales
in
the first nine months of 2007 increased by $429,000, or 15%, from $2.9 million
in the first nine months of 2006 to $3.3 million in the first nine months
of
2007. Sales in the third quarter of 2007 reflected an increase of $672,000,
or
73%, from $0.9 million in the third quarter of 2006 to $1.6 million in the
third
quarter of 2007. The increases for both periods were wholly attributable
to the
increase in our RT Solutions segment sales (increases of $338,000 and $570,000
for the nine and three month periods ended September 30, 2007 as compared
to
2006, respectively) which was the result of two new significant projects
in
2007. This increase more than offset the slight decrease in sales in our
OncoProTM
segment
during those periods.
Gross
profits in the first nine months of 2007 decreased by $35,000, or 4%, to
$815,000, compared to $849,000 for the first nine months of 2006. The decrease
was primarily attributable to lower margins in the RT Solutions segment.
The
lower margins were due to the inclusion in 2006 of certain project sales
with
relatively high gross profit margins. Gross profit in the third quarter of
2007
increased by $197,000, or 71%, to $473,000, in comparison to $276,000 in
the
third quarter of 2006, primarily due to the previously mentioned increase
in RT
Solutions sales. Gross margins were unchanged in the third quarter of 2007
as
compared to the third quarter of 2006.
Selling,
marketing, general and administrative expenses (“SMG&A”) decreased
significantly in the first nine months of 2007 ($525,000) from $3.5 million
to
$3.0 million compared to the first nine months of 2006. SMG&A also decreased
significantly (by $418,000) in the third quarter of 2007 as compared to the
third quarter of 2006. The decreases for both the nine and three month periods
is due almost entirely to decreases in stock compensation expense recognized
in
the periods in accordance with FAS 123R.
In
April
2007, Comverge completed its initial public offering. As a result of the
Comverge offering, the Company recorded an increase in its investment in
Comverge and recorded a non-cash gain of $16.2 million in “Gain on public
offering of Comverge”. Subsequent to the offering, the Company no longer
accounts for its investment in Comverge under the equity method.
In
September 2007, Paketeria completed a private placement of shares. As part
of
the transaction, the Company converted approximately $1.2 million of debt
to
equity in Paketeria. As a result of the Paketeria private placement, the
Company
recorded a decrease in its investment in Paketeria and recorded a non-cash
gain
of $533,000 in “Gain on private placement of Paketeria”.
Finance
expense, net, increased in the first nine months of 2007 as compared to the
first nine months of 2006 from $23,000 to $2.8 million. Finance expense,
net,
also increased in the third quarter of 2007 as compared to the third quarter
of
2006 from $17,000 to $716,000. The increases are entirely attributable to
the
finance costs associated with our private placement of convertible debt in
the
first and second quarters of 2007.
In
the
first quarter of 2006, we recognized $210,000 in previously unrecognized
and
current losses of our Comverge equity affiliate offsetting our additional
investments during the quarter in that amount in Comverge preferred stock.
As
our investment in Comverge had been reduced to zero, we no longer recorded
additional losses against our investment in Comverge.
In
the
first nine months of 2007, we recognized losses of $779,000 representing
our
approximate 33% share of Paketeria’s losses for the period and amortization
expense associated with acquired non-compete and franchise agreements and
the
change in value of options. In addition, we also recognized additional losses
totaling $49,000 with respect to stock compensation expense associated with
a
previous option grant to Paketeria’s founder and managing director.
As
of
September 30, 2007, all of the Company’s 2,786,021 Comverge shares can be
considered “available-for-sale” under SFAS 115 “Accounting for Certain
Investments in Debt and Equity Securities”. Accordingly, at September 30, 2007,
the Company reflected its investment in Comverge at its then fair market
value
of $ 91.5 million, an increase of $63.2 million from the value reflected
at June
30, 2007. At September 30, 2007, the Company had a net deferred tax liability
of
$21.5 million with respect to its Comverge investment.
Certain
statements made above are forward-looking in nature. Whether such statements
ultimately prove to be accurate depends upon a variety of factors that may
affect the Company's business and operations. Many of these factors are
described in the Company's most recent Annual Report on Form 10-K as filed
with
Securities and Exchange Commission.
Acorn
Factor, Inc.
(Name
of
Registrant as Specified in Charter)
has
caused this notification to be signed on its behalf by the undersigned hereunto
duly authorized.
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ACORN
FACTOR,
INC. |
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| Date: November
15, 2007 |
By: |
/s/ MICHAEL
BARTH |
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Michael
Barth |
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Authorized
Representative |