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                                                                     EXHIBIT 3.2

                                     BYLAWS
                                       OF
                              LEVEL 8 SYSTEMS, INC.
                            (a Delaware corporation)

                           as amended February 9, 2001


                                    ARTICLE 1
                                     OFFICES

     Level 8 Systems, Inc. (the "Corporation") shall at all times maintain a
registered office in the State of Delaware and a registered agent at that
address but may have other offices located in or outside of the State of
Delaware as the Board of Directors may from time to time determine.

                                   ARTICLE 2
                              STOCKHOLDERS' MEETING

     2.1 Places of Meetings. All meetings of stockholders shall be held at such
place or places inside or outside of the State of Delaware as the Board of
Directors may from time to time determine or as may be designated in the notice
of meeting or waiver of notice thereof, subject to any provisions of the laws of
the State of Delaware.

     2.2 Annual Meetings. The annual meeting of stockholders for the election of
directors and the transaction of such other business as may properly come before
the meeting shall be held on such date and at such time as may be designated
from time to time by the Board of Directors within four months after the end of
each fiscal year of the Corporation. If the annual meeting is not held on the
date designated, it may be held as soon thereafter as convenient and shall be
called the annual meeting. Written notice of the time and place of the annual
meeting shall be given by mail to each stockholder entitled to vote thereat at
his address as it appears on the records of the Corporation, not less than ten
(10) nor more than sixty (60) days prior to the scheduled date thereof, unless
such notice is waived as provided by Article 9 of these Bylaws.

     2.3 Special Meetings. Special meetings of stockholders may be called at any
time by the Board of Directors and shall be called by the President or Secretary
or an Assistant Secretary at the written request of the holders of at least 50%
of the total number of shares of stock then outstanding and entitled to vote
stating the specific purpose or purposes thereof. Written notice of the time,
place and specific purposes of such meeting shall be given by mail to each
stockholder entitled to vote thereat at his address as it appears on the records
of the Corporation, not less than ten (10) nor more than sixty (60) days prior
to the scheduled date thereof, unless such notice is waived as provided in
Article 9 of these Bylaws.

     2.4 Voting. At all meetings of stockholders, each stockholder entitled to
vote on the record date, as determined under Section 6.3 of these Bylaws or, if
not so determined, as prescribed under the laws of the State of Delaware, shall
be entitled to one vote for each share of


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stock standing of record in his name, subject to any restrictions or
qualifications set forth in the Certificate of Incorporation or any amendment
thereto.

     2.5 Quorum. At any meeting of stockholders, a majority of the number of
shares of stock outstanding and entitled to vote thereat, present in person or
by proxy, shall constitute a quorum, but a small interest may adjourn any
meeting from time to time, and the meeting may be held as adjourned without
further notice, subject to such limitation as may be imposed under the laws of
the State of Delaware. When a quorum is present at any meeting, a majority of
the number of shares of stock entitled to vote present thereat shall decide any
question brought before such meeting unless the question is one upon which a
different vote is required by express provision of the laws of the State of
Delaware, the Certificate of Incorporation or these Bylaws, in which case such
express provision shall govern.

     2.6 Action Without Meeting. Unless otherwise provided in the Certificate of
Incorporation or any amendment thereto or by the laws of the State of Delaware,
any action required by the laws of the State of Delaware to be taken at any
annual or special meeting of stockholders, or any action which may otherwise be
taken at any annual or special meeting of stockholders, may be taken without a
meeting, without prior notice and without a vote; if: (i) a consent in writing,
setting forth the action so taken, shall be signed by the holders of outstanding
stock having not less than the minimum number of votes that would be necessary
to authorize or take such action at a meeting at which all shares entitled to
vote thereon were present and voted; and (ii) prompt notice of the taking of
such action by less than unanimous written consent is given to the other
stockholders to the extent and in the manner required by the laws of the State
of Delaware.

                                   ARTICLE 3
                               BOARD OF DIRECTORS

     3.1 Powers. The business and affairs of the Corporation shall be carried on
by or under the direction of the Board of Directors, which shall have all the
powers authorized by the laws of the State of Delaware, subject to such
limitations as may be provided by the Certificate of Incorporation or these
Bylaws.

     3.2 Number and Qualification. A Board of Directors shall be elected at each
annual meeting of the stockholders, each director so elected to serve until the
election and qualifications of his successors or until his earlier resignation
or removal as provided in these Bylaws. The initial number of directors shall be
such as may be determined by the incorporator and thereafter the number of
directors shall be not less than one (1) and not more than nine (10), the exact
number within such minimum and maximum limits to be fixed and determined from
time to time by resolution of a majority of the Board of Directors or by the
affirmative vote of the holders of at least 50% of all outstanding shares of
capital stock entitled to vote in the election of directors, voting together as
a single class, as provided in the Certificate of Incorporation. Each director
shall serve for a term of one (1) year or until the election and qualification
of his successor or until his earlier resignation or removal as provided in the
Certificate or Incorporation or these Bylaws. Any employee of the Corporation or
a subsidiary of the Corporation who serves on the Board of Directors shall be
deemed to have tendered his resignation from the Board of Directors


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at the time such employee gives notice of termination of his employment with the
Corporation or any subsidiary, as the case may be, or upon the termination of
such employment for any reason, whichever occurs first; provided, however, that
the Board of Directors, in its sole discretion, may decline to accept the
resignation of the former employee from the Board of Directors if the former
employee agrees to continue to serve on the Board of Directors notwithstanding
the termination of his employment and if the Board of Directors determines that
the continued service of the former employee on the Board of Directors is in the
best interests of the Corporation and its stockholders. In case of an increase
in the number of directors between elections by the stockholders, the additional
directorships shall be considered vacancies and shall be filled in the manner
prescribed in Article 5 of these Bylaws. Directors need not be stockholders, nor
need they be residents of the State of Delaware.

     3.3 Compensation. The Board of Directors, or a committee thereof, may from
time to time by resolution authorize the payment of fees or other compensation
to the directors for services as such to the Corporation, including, but not
limited to, fees for attendance at all meetings of the Board of Directors or any
committee thereof, and determine the amount of such fees and compensation.
Directors shall in any event be paid their traveling expenses for attendance at
all meetings of the Board or committee thereof. Nothing herein contained shall
be construed to preclude any director from serving the Corporation in any other
capacity and receiving compensation therefor in amounts authorized or otherwise
approved from time to time by the Board or any committee thereof.

     3.4 Meetings and Quorum. Meetings of the Board of Directors may be held
either inside or outside of the State of Delaware. A quorum shall be one-half
(1/2) of the then authorized number of directors, but not less than two (2)
directors, provided, however, that if a Board of Directors consisting of one (1)
director is authorized, then one (1) director shall constitute a quorum.

     The Board of Directors shall, at the close of each annual meeting of
stockholders and without further notice other than these Bylaws, if a quorum of
directors is then present or as soon thereafter as may be convenient, hold a
regular meeting for the election of officers and the transaction of any other
business. At such meeting they shall elect a President and a Secretary and such
other officers as they deem proper.

     The Board of Directors may from time to time provide for the holding of
regular meetings with or without notice and may fix the times and places at
which such meetings are to be held. Meetings other than regular meetings may be
called at any time by the President and must be called by the President or the
Secretary or an Assistant Secretary upon the request of any director.

     Notice of each meeting, other than a regular meeting (unless required by,
the Board of Directors), shall be given to each director by mailing the same to
each director at his residence or business address at least two (2) days before
the meeting or by delivering the same to him personally or by telephone or
telegraph at least one (1) day before the meeting unless, in case of exigency,
the President or the Secretary shall prescribe a shorter notice to be given
personally or


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by telephone, telegraph, cable or wireless to all or any one or more of the
directors at their respective residences or places of business.

     Notice of any meeting shall state the time and place of such meeting, but
need not state the purposes thereof unless otherwise required by the laws of the
State of Delaware, the Certificate of Incorporation, the Bylaws or the Board of
Directors.

     3.5 Committee. The Board of Directors may, by resolution pass by a majority
or the entire Board of Directors, provide for an Executive Committee of two or
more Directors and shall elect the members thereof to serve at the pleasure of
the Board of Directors and may designate one of such members to act as chairman.
The Board of Directors may at any time change the membership of the Executive
Committee, fill vacancies in it, designate alternate members to replace any
absent or disqualified members at any meeting of such committee, or dissolve it.
During the intervals between the meetings of the Board of Directors, the
Executive Committee shall possess and may exercise any or all of the powers of
the Board of Directors in the management or direction of the business and
affairs of the Corporation and under the Bylaws to the extent authorized by
resolution adopted by a majority of the whole Board of Directors and to such
limitations as may be imposed by the laws of the State of Delaware.

     The Executive Committee may determine its rules of procedure and the notice
to be given of its meeting, and it may appoint such other committees and
assistants as it shall from time to time deem necessary. A majority of the
members of the Executive Committee shall constitute a quorum.

     The Board of Directors may by resolution provide for such other committees
as it deems desirable and may discontinue the same at its pleasure. Each such
committee shall have the powers to perform such duties, not inconsistent with
law, as may be assigned to it by the Board.

     3.6 Conference Telephone Meetings. Any one or more members of the Board of
Directors or any committee thereof may participate in a meeting by means of a
conference telephone or similar communication equipment by means of which all
persons participating in the meeting can hear each other, and such participation
in a meeting shall constitute presence in person at such meeting.

     3.7 Action Without Meeting. Any action required or permitted to be taken at
any meeting of the Board of Directors or any committee thereof may be taken
without a meeting if all members of the Board of Directors or committee, as the
case may be, consent thereto in writing, and the writing or writings are filed
with the minutes of proceedings of the Board of Directors or committee.


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                                    ARTICLE 4
                                    OFFICERS

     4.1 Titles and Election. The officers of the Corporation shall be the
President, the Secretary and the Treasurer, all of whom shall initially be
elected as soon as convenient by the Board of Directors and thereafter, in the
absence of earlier resignations or removals, shall be elected at the first
meeting of the Board of Directors following each annual meeting of stockholders.
Each officer shall hold office at the pleasure of the Board of Directors except
as may otherwise be approved by the Board of Directors, or until his earlier
resignation, removal under these Bylaws or other termination of his employment.
Any person may hold more than one office if the duties can be consistently
performed by the same person and to the extent permitted by the laws of the
State of Delaware.

     The Board of Directors, in its discretion, may also at any time elect or
appoint one or more Vice Presidents, a Chief Operating Officer and one or more
Assistant Secretaries and such other officers as it may deem advisable, each of
whom shall hold office at the pleasure of the Board of Directors, except as may
otherwise be approved by the Board of Directors, or until his earlier
resignation, removal or other termination of employment, and shall have such
authority and shall perform such duties as may be prescribed or determined from
time to time by the Board of Directors or, if not prescribed or determined by
the Board of Directors, the Presidents or the then senior executive officer may
prescribe or determine. The Board of Directors may require any officer or other
employee or agent to give bond for the faithful performance of his duties in
such form and with such sureties as the Board may require.

     4.2 Duties. Subject to such extension, limitations, and other provisions as
the Board of Directors may from time to time prescribe or determine, the
following officers shall have the following powers and duties:

          (a) President. The President shall exercise the powers and authority
     and perform all of the duties commonly incident to his office, shall
     preside at all meetings of the stockholders and of the Board of Directors
     if he is a director, and shall perform such other duties as the Board of
     Directors shall specify from time to time. The President or a Vice
     President, unless some other person is thereunto specifically authorized by
     the Board of Directors, shall sign all certificates for shares, bonds,
     debentures, promissory notes, deeds and contracts of the Corporation.

          (b) Vice President. The Vice President or Vice Presidents shall
     perform such duties as may be assigned to them from time to time by the
     Board of Directors or by the President if the Board of Directors does not
     do so. In the absence or disability of the President, the Vice Presidents
     in order of seniority may, unless otherwise determined by the Board of
     Directors, exercise the powers and perform the duties pertaining to the
     office of President, except that if one or more Vice Presidents has been
     elected or appointed, the person holding such office in order of seniority
     shall exercise the powers and perform the duties of the office of
     President.

          (c) Secretary. The Secretary or in his absence an Assistant Secretary
     shall keep the minutes of all meetings of stockholders and of the Board of
     Directors and any


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     committee thereof, give and serve all notices, attend to such
     correspondence as may be assigned to him, keep in safe custody the seal of
     the Corporation, and affix such seal to all such instruments properly
     executed as may require it, shall perform all of the duties commonly
     incident to his office and shall have such other duties and powers as may
     be prescribed or determined from time to time by the Board of Directors or
     by the President if the Board of Directors does not do so.

          (d) Treasurer. The Treasurer or in his absence an Assistant Treasurer,
     subject to the order of the Board of Directors, shall have the care and
     custody of the monies, funds, securities, valuable papers and documents of
     the Corporation (other than his own bond, if any, which shall be in the
     custody of the President), and shall have, under the supervision of the
     Board of Directors, all the powers and duties commonly incident to his
     office. He shall deposit all funds of the Corporation in such bank or
     banks, trust company or trust companies, or with such firm or firms doing a
     banking business as may be designated by the Board of Directors or by the
     President if the Board of Directors does not do so. He may endorse for
     deposit or collection all checks, notes, and similar instruments payable to
     the Corporation or to its order. He shall keep accurate books of account of
     the Corporation's transactions, which shall be the property of the
     Corporation, and together with all of the property of the Corporation in
     his possession, shall be subject at all times to the inspection and control
     of the Board of Directors. The Treasurer shall be subject in every way to
     the order of the Board of Directors, and shall render to the Board of
     Directors and/or the President of the Corporation, whenever they may
     require it, an account of all his transactions and of the financial
     condition of the Corporation. In addition to the foregoing, the Treasurer
     shall have such duties as may be prescribed or determined from time to time
     by the Board of Directors or by the President if the Board of Directors
     does not do so.

          (e) Assistant Secretaries and Treasurers. Assistants to the
     Secretaries and Treasurers may be appointed by the President or elected by
     the Board of Directors and shall perform such duties and have such powers
     as shall be delegated to them by the President or the Board of Directors.

     4.3 Delegation of Authority. The Board of Directors may at any time
delegate the powers and duties of any officer for the time being to any other
officer, director or employee.

     4.4 Compensation. The compensation of the officers of the Corporation shall
be fixed by the Board of Directors or a committee thereof, and the fact that any
officer is a director shall not preclude him from receiving compensation or from
voting upon the resolution providing the same.

                                   ARTICLE 5
                       RESIGNATIONS, VACANIES AND REMOVALS

     5.1 Resignations. Any director or officer may resign at any time by giving
written notice thereof to the Board of Directors, the President or the
Secretary. Any such resignation shall take effect at the time specified therein
or, if the time be not specified, upon receipt thereof;


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and unless otherwise specified therein, the acceptance of any resignation shall
not be necessary to make it effective.

     5.2 Vacancies.

         (a) Directors. Any vacancy in the Board of Directors caused by reason
     of death, incapacity, resignation, removal, increase in the authorized
     number of directors or otherwise, shall be filled by the vote of a majority
     of the Board of Directors. Any director so filling such a vacancy shall
     serve until the next annual meeting of stockholders and the election and
     qualification of his successor or until his earlier resignation or removal
     as provided in the Certificate of Incorporation or these Bylaws.

         (b) Officers. The Board of Directors may at any time or from time to
     time fill any vacancy among the officers of the Corporation.

     5.3 Removals.

          (a) Directors. Except as may otherwise be provided by the General
     Corporation Law of Delaware, any director or the entire Board of Directors
     may be removed, with or without cause, by the holders of a majority of the
     shares then entitled to vote at an election of directors.

          (b) Officers. Subject to the provisions of any validly existing
     agreement, the Board of Directors may at any meeting remove from any office
     any officer, with or without cause, and may appoint a successor; provided
     that if action is to be taken to remove the President, the notice of
     meeting or waiver of notice thereof shall state that one of the purposes of
     the meeting is to consider and take action on his removal.

                                    ARTICLE 6
                                  CAPITAL STOCK

     6.1 Certificates of Stock. Every stockholder shall be entitled to a
certificate or certificates for shares of the capital stock of the Corporation
in such form as may be prescribed or authorized by the Board of Directors, duly
numbered and setting forth the number and kind of shares represented thereby.
Such certificates shall be signed by the President or a Vice President and by
the Treasurer or an Assistant Treasurer or by the Secretary or an Assistant
Secretary. Any or all of such signatures may be in facsimile.

     In case any officer, transfer agent or registrar who has signed or whose
facsimile signature has been placed on a certificate has ceased to be such
officer, transfer agent or registrar before the certificate has been issued,
such certificate may nevertheless be issued and delivered by the Corporation
with the same effect as if he were such officer, transfer agent or registrar at
the date of issue.

     6.2 Transfer of Stock. Shares of the capital stock of the Corporation shall
be transferable only upon the books of the Corporation upon the surrender of the
certificate or


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certificates properly assigned and endorsed for transfer. If the Corporation has
a transfer agent or registrar acting on its behalf, the signature of any officer
or representative thereof may be in facsimile.

     The Board of Directors may appoint a transfer agent and one or more
co-transfer agents and a registrar and one or more co-registrars and may make or
authorize such agents to make all such rules and regulations deemed expedient
concerning the issue, transfer and registration of shares of stock.

     6.3 Record Dates. For the purpose of determining stockholders entitled to
notice of or to vote at any meeting of stockholders or any adjournment thereof,
or entitled to receive payment of any dividend, or to express consent to
corporate action in writing without a meeting, or in order to make a
determination of stockholders for any other proper purposes, the Corporation's
stock transfer books shall not be closed, but a record date shall be set by the
Board of Directors and, upon that date, the Corporation or its transfer agent
shall take a record of the stockholders without actually closing the stock
transfer books. Such record date shall not be more than sixty (60) days, nor
less than ten (10) days, prior to the date on which the particular action
requiring such determination of stockholders is to be taken.

     If no such record date is fixed by the Board, the record date shall be that
prescribed by the laws of the State of Delaware.

     A determination of stockholders of record entitled to notice of or to vote
at a meeting of stockholders shall apply to any adjournment of the meeting;
provided, however, that the Board of Directors may fix a new record date for the
adjourned meeting.

     6.4 Lost Certificates. In case of loss or mutilation or destruction of a
stock certificate, a duplicate certificate may be issued upon such terms as may
be determined or authorized by the Board of Directors or the Executive
Committee, or by the President if the Board of Directors or the Executive
Committee does not do so.

                                   ARTICLE 7
                    FISCAL YEAR, BANK DEPOSITS, CHECKS, ETC.

     7.1 Fiscal Year. The fiscal year of the Corporation shall be the calendar
year, unless otherwise fixed by resolution of the Board of Directors.

     7.2 Bank Deposit, Checks, Etc. The funds of the Corporation shall be
deposited in the name of the Corporation or of any division thereof in such
banks or trust companies in the United States or elsewhere as may be designated
from time to time by the Board of Directors or the Executive Committee, or by
such officer or officers as the Board of Directors or the Executive Committee
may authorize to make such designations.

     All checks, drafts or other orders for the withdrawal of funds from any
bank account shall be signed by the President or such other person or persons as
may be designated from time to


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time by the Board of Directors or the Executive Committee. The signatures on
checks, drafts or other orders for the withdrawal of funds may be in facsimile
if authorized in the designation.

                                    ARTICLE 8
                                BOOKS AND RECORDS

     8.1 Place of Keeping Books. The books and records of the Corporation may be
kept outside of the State of Delaware.

     8.2 Examination of Books. Except as may otherwise be provided by the laws
of the State of Delaware, the Certificate of Incorporation or these Bylaws, the
Board of Directors shall have the power to determine from time to time whether
and to what extent and at what times and places and under what conditions any of
the accounts, records and books of the Corporation are to be open to the
inspection of any stockholder. No stockholder shall have any right to inspect
any account or book or document of the Corporation except as prescribed by law
or authorized by express resolution of the stockholders or of the Board of
Directors.

                                    ARTICLE 9
                                     NOTICES

     9.1 Requirements of Notice. Whenever notice is required to be given by
statute, the Certificate of Incorporation or these Bylaws, it shall not mean
personal notice unless so specified, but such notice may be given in writing by
depositing the same in a post office, letter box, or mail chute postage prepaid
and addressed to the person to whom such notice is directed at the address of
such person on the records of the Corporation, and such notice shall be deemed
given at the time when the same shall be thus mailed.

     9.2 Waivers. Any stockholder, director or officer may, in writing or by
telegram or cable, at any time waive any notice or other formality required by
statute, the Certificate of Incorporation or these Bylaws. Such waiver of
notice, whether given before or after any meeting or action, shall be deemed
equivalent to notice. Presence of a stockholder either in person or by proxy at
any meeting of stockholders and presence of any director at any meeting of the
Board of Directors shall constitute a waiver of such notice as may be required
by any statute, the Certificate of Incorporation or these Bylaws.

                                   ARTICLE 10
                                      Seal

     The corporate seal of the Corporation shall be in such form as the Board of
Directors shall determine from time to time and may consist of a facsimile
thereof or the word "SEAL" enclosed in parentheses.


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                                   ARTICLE 11
                               POWERS OF ATTORNEY

     The Board of Directors or the Executive Committee may authorize one or more
of the officers of the Corporation to execute powers of attorney delegating to
named representatives or agents power to represent or act on behalf of the
Corporation, with or without power of substitution.

     In the absence of any action by the Board of Directors or the Executive
Committee, any officer of the Corporation may execute, for and on behalf of the
Corporation, waivers of notice of meetings of stockholders and proxies, or may
vote shares directly, for such meetings of any company in which the Corporation
may hold voting securities.

                                   ARTICLE 12
              INDEMNIFICATION OF DIRECTORS, OFFICERS AND EMPLOYEES

     The Corporation shall indemnify its directors, officers and employees to
the extent provided in the Corporation's Certificate of Incorporation.

                                   ARTICLE 13
                                   AMENDMENTS

     Except as provided otherwise by the laws of the State of Delaware, the
Certificate of Incorporation or elsewhere in these Bylaws, these Bylaws may be
amended or repealed either:

          (a) at any meeting of stockholders at which a quorum is present by
     vote of a majority of the number of shares of stock entitled to vote
     present in person or by proxy at such meeting; or

          (b) at any meeting of the Board of Directors by a majority vote of the
     directors then in office;

provided that the notice of such meeting of stockholders or directors or waiver
of notice thereof contains a statement of the substance of the proposed
amendment or repeal.

                                   ARTICLE 14
                          AGREEMENT AMONG STOCKHOLDERS

     If any provision of these Bylaws shall be inconsistent or in conflict with
any written agreement among the stockholders of the Corporation, the applicable
provisions of such agreement shall control and take precedence over the terms of
these Bylaws notwithstanding any provision of these Bylaws.


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