Panic has updated icon customization app CandyBar for compatibility with OS X 10.8, changed the price to free and handed it over to The Iconfactory. As the 'Factory workers point out, changes Apple has recently made to OS X security have hindered the app significantly. For that reason, it's no longer supported.
Mac users have long enjoyed the ability to customize the look of their operating system. Who remembers Kaleidoscope from the pre-OS X days? We sure do. Unfortunately, OS X rendered Kaleidoscope obsolete, and now Mountain Lion is looking to do the same to CandyBar.
For example, Apple's latest OS prevents customization of Dock icons (though the indicator light can be changed). Also, a custom icon on a signed app could cause the App Store to fail to recognize an available update.
Anyone who purchased CandyBar during July, 2012 can receive a refund (see details here). Panic indicates that The Iconfactory has plans for the app's future, but we'll have to wait and see what those will be.