UNITED STATES SECURITIES AND EXCHANGE COMMISSION

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

~~PURSUANT TO SECTION~~ July 13, ~~OR 15(d)~~ 2005

OFDate ~~THE~~of ~~SECURITIES~~Report ~~EXCHANGE~~(Date ~~ACT~~of OFearliest ~~1934~~event reported)

~~Date~~Daou ~~of Report (Date of Earliest Event Reported): September 9~~Systems, ~~2004~~ Inc.

~~DAOU~~(Exact ~~SYSTEMS,~~name ~~INC.~~of registrant as specified in its charter)

(Exact Name of Issuer as Specified in Charter)

DELAWARE	000-22073	33-0284454
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

412 Creamery Way, Suite 300 Exton, Pennsylvania			19341
(Address of principal executive offices)			(Zip Code)

DELAWARE		000-22073		33-0284454
(State or Other Jurisdiction of Incorporation or Organization)		(Commission File Number)		(I.R.S. Employer Identification Number)

610-594-2700

~~412~~(Registrant’s ~~Creamery~~telephone ~~Way~~number, ~~Suite~~ ~~300,~~including ~~Exton,~~area ~~Pennsylvania 19341~~ code)

~~(Address of Principal Executive Offices)~~ None

(~~610)~~Former ~~594-2700~~name or former address, if changed since last report.)

~~(Registrant’s~~Check ~~Telephone~~the ~~Number,~~appropriate ~~Including~~box below ~~Area~~if ~~Code)~~the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

~~Check~~o Written communications pursuant to Rule 425 under the ~~appropriate~~Securities ~~box~~Act ~~below~~(17 ifCFR 230.425) o Soliciting material pursuant to Rule 14a-12 under the ~~Form~~Exchange 8Act (17 CFR 240.14a-K12) iso ~~intended~~Pre-commencement communications pursuant to ~~simultaneously~~ ~~satisfy~~Rule 14d-2(b) under the ~~filing~~Exchange ~~obligation~~Act of(17 ~~the~~CFR ~~registrant~~240.14d-2(b)) ~~under~~o ~~any~~Pre-commencement ofcommunications pursuant to Rule 13e-4(c) under the ~~following~~Exchange ~~provisions:~~Act (17 CFR 240.13e-4(c))

¨Item ~~Written~~2.02. ~~communications~~Results ~~pursuant~~of toOperations ~~Rule~~and ~~425~~Financial ~~under the Securities Act~~Condition.

¨See ~~Soliciting~~the ~~material~~disclosure ~~pursuant to Rule 14a-12~~ under Item ~~the~~4.02 ~~Exchange Act~~below.

¨Item ~~Pre~~4.02 Non-~~commencement~~Reliance ~~communications~~on ~~pursuant~~Previously toIssued ~~Rule~~Financial ~~14d-2(b)~~Statements ~~under~~or ~~the~~a ~~Exchange~~Related ~~Act~~Audit Report or Completed Interim Review.

¨As ~~Pre~~part of a routine review of the Daou Systems, Inc. (the “Company”) Form 10-~~commencement~~K ~~communications~~for ~~pursuant~~the toyear ended ~~Rule~~December 31, ~~13e~~2004 by the staff of the Securities and Exchange Commission (“SEC”), the Company examined the classification on its balance sheet of its Series A-41 Preferred Stock (creferred to as “Series A Preferred Stock” in the Company’s Form 10-K for the year ended December 31, 2004). The ~~under~~Company had classified this amount as a component of stockholders’ equity in its financial statements for the ~~Exchange~~year ended ~~Act~~December 31, 2004 filed in its Form 10-K with the SEC.

~~Item.~~Based on the staff’s comment, the Company reviewed the terms of the Series A-1 Preferred Stock and noted that in the event of an unsolicited tender offer that results in the Company’s stockholders immediately prior to such transaction not holding at least 50% of the voting securities of the surviving entity, the holders of the Series A-1 Preferred Stock would be entitled to receive for each share of such stock an amount per share at least equal to Five Dollars and Fifty Cents ($5.0250) plus any accrued but unpaid dividends. Because ~~Departure~~such a transaction could result in a cash liquidation of ~~Directors~~the orSeries A-1 Preferred ~~Principal~~Stock ~~Officers;~~that ~~Election~~is outside the control of the Company, management, in consultation with the Company’s independent registered public accounting firm, concluded on July 13, 2005 that the Series A-1 Preferred Stock should be classified as a component of mezzanine equity and not a component of permanent equity on the Company’s balance sheet and that the Company should restate its previously issued financial statements. On July 18, 2005, the Audit Committee of the Company’s Board of Directors;, ~~Appointment~~in consultation with the Company’s independent registered public accounting firm, confirmed management’s conclusion that a restatement of ~~Principal~~the ~~Officers~~previously issued financial statements is required.

OnThe ~~September~~restatement 9,will ~~2004, the Board of Directors of Daou Systems, Inc.~~be ~~(“Daou”)~~an ~~increased~~adjustment ~~the size~~ of the ~~Board~~Company’s tobalance ~~six~~sheet ~~members~~ and ~~elected~~will ~~Richard~~have ~~Blumenthal~~no toimpact on the Company’s ~~Board.~~historical ~~There~~or ~~was~~future noincome ~~arrangement~~statements ofor ~~understanding~~cash ~~between Mr~~flows. The ~~Blumenthal~~Company ~~and~~intends ~~any other person pursuant~~ to ~~which~~file ~~Mr.~~the ~~Blumenthal was selected as a~~restated ~~director.~~financial ~~Mr.~~statements ~~Blumenthal~~in ~~has~~an ~~been~~amendment ~~added~~ to the ~~class~~Company’s ofForm 10-K ~~directors~~for ~~whose term will expire at~~ the year ~~2006~~ended ~~annual~~December 31, ~~meeting~~2004 ofand ~~stockholders.~~an Itamendment ~~is anticipated that Mr. Blumenthal will be appointed~~ to the ~~Audit~~Company’s ~~Committee~~Form 10-Q for ~~and Nominating Committee of~~ the ~~Board of~~quarter ~~Directors.~~ended ~~Daou~~March 31, ~~issued~~2005 aupon ~~press~~the ~~release~~completion onof ~~September~~the ~~10,~~SEC ~~2004 to announce Mr. Blumenthal~~staff’s routine ~~election.~~review ~~The full text~~ of the ~~press~~Company’s ~~release~~Form 10-K isfor ~~attached~~the asyear ~~Exhibit~~ended 99December 31, 2004.~~1 to this Current Report on Form 8-K.~~

~~Item 9.01. Financial Statements and Exhibits~~ 2

~~The following exhibits are filed with this Form 8-K:~~ Signatures

Exhibit No.		Description
99.1		Press Release dated September10, 2004.

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

SIGNATURES

	DAOU SYSTEMS, INC.


Date: July 13, 2005	By:	/s/ John A. Roberts
		John A. Roberts
		Chief Financial Officer

~~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.~~ 3

	DAOU SYSTEMS, INC.
Date: September 14, 2004	By:	/s/ John A. Roberts
		John A. Roberts Chief Financial Officer and Secretary

Index of Exhibits

Exhibit Number		Description
99.1		Press Release dated September 10, 2004.

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