**UNITED STATES**

**SECURITIES AND EXCHANGECOMMISSION**

**Washington,D.C. 20549**

 

**FORM 10-K/A**

 

**AmendmentNo. 1**

 

| **(Mark one)** | ** ** | ** **                                                                                                | ** ** |
|----------------|------------|-----------------------------------------------------------------------------------------------------------|------------|
|           |       |                                                                                                      |       |
| ** **     | ** ** | **ý**** Annual report pursuant to  Section 13 or 15(d) of the Securities Exchange Act of 1934** | ** ** |
|           |       |                                                                                                      |       |
| ** **     | ** ** | **For the fiscal year ended December 31, 2005**                                                           | ** ** |
| ** **     | ** ** | ** **                                                                                                | ** ** |
| ** **     | ** ** | **OR**                                                                                                    | ** ** |
|           |       |                                                                                                      |       |
| ** **     | ** ** | **o**** Transition report  pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934**  | ** ** |

 

**CommissionFile Number:  0-31151**

 

**RADVIEW SOFTWARE LTD.**

(Exact name ofregistrant as specified in its charter)

 

| **Israel**                       | ** ** | **Not  applicable**  |
|----------------------------------|------------|----------------------|
| (State or other  jurisdiction of |       | (I.R.S. Employer     |
| incorporation or  organization)  |       | Identification  No.) |

 

**7 NewEngland Executive Park**

**Burlington,MA 01803**

(Address ofprincipal executive offices)

 

##### **Telephone Number (781) 238-1111**

(Registrant’stelephone number, including area code)

 

Securitiesregistered pursuant to Section 12(b) of the Act:

**None**

** **

Securitiesregistered pursuant to Section 12(g) of the Act:

**Ordinary Shares, NIS0.01 par value**

(Title of Class)

 

Indicate by check mark ifthe registrant is a well-known seasoned issuer, as defined in Rule 405 of theSecurities Act. Yes  o  No  ý.

 

Indicate by check mark ifthe registrant is not required to file reports pursuant to Section 13 orSection 15(d) of the Act. Yes  o  No  ý.

 

Indicate by check markwhether the registrant (1) has filed all reports required to be filed bySection 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding12 months (or for such shorter period that the registrant was required to filesuch reports), and (2) has been subject to such filing requirements for thepast 90 days. Yes  ý  No  o.

 

Indicate by check mark ifdisclosure of delinquent filers pursuant to Item 405 of Regulation S-K is notcontained herein, and will not be contained, to the best of registrant’sknowledge, in definitive proxy or information statements incorporated byreference in Part III of this Form 10-K or any amendment to this Form 10-K. ý

 

Indicate by check mark whether the registrant is alarge accelerated filer, an accelerated filer, or a non-accelerated filer. Seedefinition of “accelerated filer and large accelerated filer” in Rule 12b-2 ofthe Exchange Act). (Check one):

 
| Large accelerated filer o |   | Accelerated filer o |   | Non-accelerated filer ý |
|---------------------------|--------|---------------------|--------|------------------------------|

 

Indicate by check mark ifthe registrant is a shell company (as defined in Rule 12b-2 of the Act).Yes  o  No  ý.

 

Aggregate market value,based upon the closing sale price of the shares as reported by the NasdaqSmallCap Market, of voting shares held by non-affiliates at June 30, 2005:$2,710,930 (excludes shares held by executive officers, directors, andbeneficial owners of more than 10% of the registrant’s Ordinary Shares). Exclusionof shares held by any person should not be construed to indicate that suchperson possesses the power, direct or indirect, to direct or cause thedirection of management or policies of the registrant, or that such person iscontrolled by or under common control with the registrant.

 

As of March 31, 2006,there were 20,525,682 shares of the registrant’s Ordinary Shares outstanding,excluding 134,000 Ordinary Shares held by the registrant as treasury sharesthat are “dormant” shares for purposes of Israeli law.

 

 

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This Form 10-K/A Amendment No. 1 is being filed byRadView Software Ltd. (the “Company”) in order to include the informationrequired by Items 10 through 13 of Part III of Form 10-K under the SecuritiesExchange Act of 1934, as amended. The Company’s Annual Report on Form 10-K wasfiled with the Securities and Exchange Commission on April 14, 2006 and providedfor the incorporation by reference in Items 10 through 13 of the informationcontained in the Company’s proxy statement to be issued in connection with its2006 Annual Meeting of shareholders. The Company will not file its proxystatement by April 30, 2006.

 

The Annual Report on Form 10-K for the fiscal yearended December 31, 2005 of the Company, as filed with the Securities andExchange Commission on April 14, 2006, is hereby amended by amending andrestating Items 10 through 13 of Part III.

 

**PART III**

** **

**Item 10. DIRECTORS AND EXECUTIVE OFFICERS OFTHE REGISTRANT**

** **

**Appointmentof New Director**

 

In accordance with theCompany’s articles of association, the Company’s board of directors hasappointed Eli Blatt as a director of the Company effective April 26, 2006 toserve until the next annual meeting of shareholders. Information about Mr.Blatt is presented below.

 

Mr. Blatt, along with oneof the Company’s other directors, Yochai Hacohen, is a partner in FortissimoCapital Funds G.P. L.P. (“Fortissimo”). As reported elsewhere in this AnnualReport on Form 10-K, Fortissimo and the Company have entered into definitiveagreements for an investment by Fortissimo in convertible preferred shares andconvertible debt of the Company. Fortissimo has provided the Company withinterim financing pursuant to a bridge loan agreement that provides for up to$500,000 of bridge loans, of which the Company has borrowed $330,000 as ofApril 30, 2006.

 

**Informationabout Directors and Executive Officers**

 

The following table containscertain information about the directors and executive officers of theregistrant:

 
| **Name**           | ** ** | **Age** | ** ** | **Position**                                     |
|--------------------|------------|---------|------------|--------------------------------------------------|
|               |       |    |       |                                             |
| Shai Beilis        |       | 57      |       | Chairman of the Board                            |
| Ilan Kinreich      |       | 48      |       | Chief Executive  Officer, President and Director |
| Christopher Dineen |       | 37      |       | Chief Financial Officer                          |
| David Assia        |       | 54      |       | Director                                         |
| Yochai Hacohen     |       | 40      |       | Director                                         |
| Eli Blatt          |       | 43      |       | Director                                         |

 

**SHAIBEILIS** has served as a **Director**since May 1998. Mr. Beilis was elected as Chairman of the Board in May 2001. Mr.Beilis has been the Chairman and Managing Partner of Formula Ventures Ltd.since December 1998. From January 1995 until joining Formula Ventures Ltd., Mr.Beilis served as the Chief Executive Officer of Argotec Ltd., a wholly-ownedsubsidiary of Formula Systems (1985) Ltd. established in 1993 to capitalize oninvestment opportunities in the IT sector where he was responsible forinitiating, overseeing and managing Argotec’s investments. Before joiningFormula Systems (1985) Ltd., Mr. Beilis served as Chief Executive Officer ofClal Computers and Technology Ltd. and was employed by Digital EquipmentCorporation. Mr. Beilis serves as a director for Crystal System Solutions Ltd.,Applicom Software Industries Ltd. and several private companies. Mr. Beilisholds a B.S. degree in Mathematics and Economics from the Hebrew University inJerusalem and a M.S. in Computer Science from the Weizmann Institute ofScience.

 

**ILANKINREICH** has served as a **Director**and our Chief Executive Officer and President since inception of our operationsin 1993. From August 1989 to February 1991, Mr. Kinreich was a co-founder andVice President of

 

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Research and Developmentat Mercury Interactive, a software testing company. From May 1985 until joiningMercury Interactive, Mr. Kinreich held the position of Research and DevelopmentManager at Daisy Systems. Prior to that, Mr. Kinreich was part of theintegration team for the Lavi jet fighter. Prior to this, Mr. Kinreich servedseven years in the Israel Defense Forces, holding the rank of Captain, where heled development and deployment of command and control systems. Mr. Kinreichholds a B.Sc. in Mathematics and Computer Science from Bar Ilan University.

 

**CHRISTOPHERDINEEN**has servedas our Chief Financial Officer since June 2003. From June 2000 until hisappointment as Chief Financial Officer, Mr. Dineen served as our Vice Presidentof Finance. From September 1991 until joining us in June 2000, Mr. Dineen wasan auditor with Arthur Andersen LLP serving clients in varied industries,including software, manufacturing, and advertising. Mr. Dineen has a B.S. inaccounting from Northeastern University and is a Certified Public Accountant.

 

**DAVIDASSIA** has served as an External Director of the Company sinceNovember 2002. Mr. Assia, a co-founder and acting CEO since August 2005 ofMagic Software Enterprises Ltd., has served as Chairman and/or Vice Chairman ofMagic Software since 1986, and as a director of Magic Software since itsinception in 1984. From 1986 until September 1997, he was Chief ExecutiveOfficer of Magic Software. He also serves as a Director of Aladdin KnowledgeSystems Ltd., Babylon Ltd. and Enformia Ltd. Mr. Assia holds B.A. and M.B.A.degrees from Tel Aviv University.

 

**YOCHAIHACOHEN** has served as a Director of the Company sinceFebruary 2006. Mr. Hacohen joined Fortissimo in May 2004 and became a partnerin January 2005. From October 2003 through May 2004, Mr. Hacohen served as theGeneral Manager of a U.S. division of Magal Security Systems Ltd., a providerof hardware and software solutions for the surveillance market. From October1998 through September 2002, Mr. Hacohen served as the Director of EMEA Salesand Marketing for the video recording division of Nice Systems Ltd., a providerof digital video and audio recording solutions. Mr. Hacohen received a B.Sc.degree in biotechnology and M.B.A. in marketing from Tel Aviv University. Mr.Hacohen also served in an elite intelligence unit in the Israel defense forces.

 

**ELIBLATT** has served as Director of the Company since April 26,2006. Mr. Hacohen joined Fortissimo as a partner January 2005. From March 1999through May 2004, Mr. Blatt served as the Chief Financial Officer and VicePresident of Operations of Noosh, Inc., a supplier of cross-enterprisee-business software solutions. From September 1997 through February 1999, Mr.Blatt served as the Director of Operations for CheckPoint Software TechnologiesInc., an Internet security company, where he was responsible for OEMoperations, product licensing and customer service. Mr. Blatt currently serveson the board of directors of Telrad Networks and NUR Macroprinters Ltd. Mr.Blatt received an MBA degree from Indiana University and a B.Sc. degree inIndustrial Engineering from Tel Aviv University. Mr. Blatt also served as afighter pilot in the Israeli air force.

 

**Section 16(a) BeneficialOwnership Reporting Compliance**

 

Section 16(a) of theSecurities Exchange Act of 1934 requires the Company’s directors and executiveofficers, and persons who own more than ten percent of a registered class ofthe Company’s equity securities, to file with the Securities and ExchangeCommission initial reports of ownership and reports of changes in ownership ofordinary share and other equity securities of the Company.

 

The Company believes thatduring the 2005 fiscal year, the officers, directors and holders of more than10% of the Company’s ordinary shares complied with all Section 16(a) filingrequirements.

 

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**Item 11. EXECUTIVECOMPENSATION**

 

The following tables set forth certain informationwith respect to compensation paid or accrued for services rendered to theCompany in all capacities for each of the three fiscal years ended December 31,2005 by its Chief Executive Officer and the other executive officer of theCompany whose salary and bonus during the fiscal year ended December 31, 2005exceeded $100,000 (collectively, the “Named Executive Officers”). The Companyhad no other executive officers in the year ended December 31, 2005.

 

**SUMMARYCOMPENSATION TABLE**

 
| ** **                      | ** ** | ** **       | ** ** | ** **               | ** ** | ** ** | ** ** | **Long-Term  Compensation  Awards** | ** ** |
|---------------------------------|------------|------------------|------------|--------------------------|------------|------------|------------|-------------------------------------|------------|
| ** **                      | ** ** | ** **       | ** ** | **Annual  Compensation** | ** ** | ** ** | ** ** | **Number  of**                      | ** ** |
| **Name and Principal Position** | ** ** | **Fiscal  Year** | ** ** | **Salary**               | ** ** | **Bonus**  | ** ** | **Other  Annual  Compensation**     | ** ** | **Securities********Underlying  Options** | ** ** |
|                            |       |             |       |                     |       |       |       |                                |       |   |   |
| **Ilan Kinreich,**              | ** ** | **2005**         | ** ** | **$**                    | 174,677    |       | $          | 24,243                              | ** ** | **—** | ** ** | **—** | ** ** |
| ***Chief Executive  Officer***  | ** ** | **2004**         | ** ** | **171,000**              |       | 18,311     | ** ** | **—**                          | ** ** | **—** | ** ** |
| ***and President***             | ** ** | **2003**         | ** ** | **179,038**              | ** ** | —     | ** ** | **—**                          | ** ** | **—** | ** ** |
|                            |       |             |       |                     |       |       |       |                                |       |   |   |
| **Christopher Dineen**          |       | 2005             |       | 133,779                  |       | 23,156     |       | —                              |       | 117,400 |   |
| ***Chief Financial  Officer***  |       | 2004             |       | 118,096                  |       | 22,111     |       | —                              |       | — |   |
|                            |       | 2003             |       | 100,962                  |       | —     |       | —                              |       | 75,000 |   |
|                                 |            |                  |            |                          |            |            |            |                                     |            |  |  |  |  |

 

# **EmploymentContracts, Termination of Employment and Change of Control Arrangements**

 

At the start of theiremployment, our employees in the United States generally sign offer lettersspecifying basic terms and conditions of employment as well as agreements thatinclude confidentiality, non-compete provisions and assignment of intellectualproperty rights related to their employment. At the start of their employment,our employees in Israel generally sign written employment agreements thatinclude confidentiality and non-compete provisions.

 

In addition, certain keyemployees of the Company, including Messrs. Kinreich and Dineen have a changeof control agreement with the Company under which (i) fifty percent (50%) ofunvested stock options and/or restricted shares then held by the employee shallimmediately vest upon a change of control of the Company; (ii) they willreceive a severance package consisting of six months’ base salary, plus any accruedcompensation, reimbursements and vacation time owed; and (iii) the remainingunvested stock options and/or restricted shares then held by the employee shallimmediately vest, if the employee terminates his employment with the Companyfor a good reason, as defined therein, or his employment is terminated withoutcause, each within twelve (12) months of a change in control of the Company. Underthe terms of the change of control agreements, a change of control will bedeemed to have occurred upon the following events: (a) a sale, lease or othertransfer of all or substantially all of the assets of the Company; (b) personsconstituting the Board of Directors of the Company on the date of the agreementor new directors approved by those persons cease to constitute a majority ofthe members of the Board of Directors; (c) a merger of the Company with anotherentity following which the shareholders of the Company do not own 50% of thevoting power of the securities of the entity acquiring the Company; (d) a thirdparty acquires 25% or more of the total number of votes that may be cast forthe Directors of the Company; or (e) the Directors adopt a resolution statingthat a change in control has occurred for the purposes of the agreement. TheCompany expects that upon consummation of the investment by Fortissimo, asdescribed elsewhere in the Annual Report on Form 10-K, a change in controlevent will occur.

 

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# **Option Grants**

# ** **

The following tablepresents each grant of ordinary share options during the fiscal year endedDecember 31, 2005 to each of the Named Executive Officers.

 

**OPTION GRANTS IN LAST FISCALYEAR**

** **
| **Name**               | ** ** | **Number  of********Securities********Underlying********Options  Granted** | ** ** | **Percent  of********Total  Options********Granted  To********Employees********In  2005 (1)** | ** ** | **Exercise********Price********Per  Share (2)** | ** ** | **Expiration  Date** | ** ** | **Potential  Realizable  Value At Assumed  Annual Rates********Of  Stock Price  Appreciation********For  Option Terms (3)** | ** ** |
|------------------------|------------|----------------------------------------------------------------------------|------------|-----------------------------------------------------------------------------------------------|------------|-------------------------------------------------|------------|----------------------|------------|-----------------------------------------------------------------------------------------------------------------------------|------------|
| **5%**                 | ** ** | **10%**                                                                    | ** ** |
|                   |       |                                                                       |       |                                                                                          |       |                                            |       |                 |       |                                                                                                                        |       |   |   |
| **Ilan Kinreich**      |       | —                                                                     |       | —                                                                                        |       | —                                          |       | —               |       | —                                                                                                                      |       | — |   |
| **Christopher Dineen** |       | 100,000                                                                    | (4)        | 9.1                                                                                           | %          | $                                               | 0.22       |                 | 3/15/15    |                                                                                                                        | $          | 13,836 |   | $ | 35,062 |   |
|                   |       | 17,400                                                                     | (4)        | 1.6                                                                                           | %          | 0.22                                            |       | 4/29/15              |       | 2,407                                                                                                                       |       | 6,101 |   |
|                        |            |                                                                            |            |                                                                                               |            |                                                 |            |                      |            |                                                                                                                             |            |  |  |  |  |  |

 

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(1)   Percentagesshown under “Percent of Total Options Granted to Employees in 2005” are basedon an aggregate of 1,101,055 options granted to our employees under our optionplans during 2005.

 

(2)   Theexercise price equals the fair market value of the ordinary shares, which isequal to the closing sales prices of the ordinary shares as quoted on theNasdaq Stock Market as of the grant date.

 

(3)   Thepotential realizable value is calculated based on the term of the option at thetime of grant. Share price appreciation of 5.0% and 10.0% is assumed pursuantto the rules promulgated by the SEC and does not represent our estimate offuture stock price performance. The potential realizable values at 5.0% and10.0% appreciation are calculated by: (a) multiplying the number of ordinaryshares under the option by the exercise price per share; (b) assuming that theaggregate share value derived from that calculation compounds at the annual5.0% or 10.0% rate shown in the table until the expiration of the options; and(c) subtracting from that result the aggregate option exercise price.

 

(4)   Theseoptions vest quarterly over four years.

 

**The following table sets forth information withrespect to (i) stock options exercised in the fiscal year ended December 31,2005 by the Named Executive Officers and (ii) unexercised stock options held bysuch individuals.**

 

**AGGREGATED OPTION EXERCISESIN 2005AND FISCAL YEAR-END OPTION VALUES**

 
| **Name**                | ** ** | **Shares  Acquired  on  Exercise (#)** | ** **      | **Value  Realized** | ** **        | **Number of Securities****Underlying Unexercised  Options at December 31, 2005** | ** ** | **Value of Unexercised****in-the-Money Options at  December 31, 2005** | ** ** |
|-------------------------|------------|----------------------------------------|-----------------|---------------------|-------------------|----------------------------------------------------------------------------------|------------|------------------------------------------------------------------------|------------|
| **Exercisable**         | ** ** | **Unexercisable**                      | **Exercisable** | ** **          | **Unexercisable** | ** **                                                                       |
|                    |       |                                   |            |                |              |                                                                             |       |                                                                   |       |   |   |   |   |
| **Ilan  Kinreich**      | ** ** | **—**                             | ** **      | **—**          | ** **        | **520,000**                                                                      | ** ** | **430,000**                                                            | ** ** | **—** | ** ** | **—** | ** ** |
| **Christopher  Dineen** | ** ** | **—**                             | ** **      | **—**          | ** **        | **132,150**                                                                      | ** ** | **120,250**                                                            |       | **—** | ** ** | **—** | ** ** |

 

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**REPORT OFCOMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION**

 

This report is submittedby the Compensation Committee. The Compensation Committee currently consists ofShai Beilis and David Assia. Each of the members of the Compensation Committeeis an independent director under the rules of the SEC and Nasdaq.

 

***Compensation Philosophy****.*****The Company’s executive compensation program is designed toattract, retain and reward executives in a competitive industry. To achievethis goal, the Compensation Committee applies the philosophy that compensationof executive officers should be linked to meeting specified performance goals.

 

Under the direction ofthe Compensation Committee, the Company has developed and implementedcompensation policies. The Compensation Committee’s executive compensationpolicies are designed to (i) enhance operating results of the Company andshareholder value, (ii) integrate compensation with the Company’s annual andlong-term performance goals, (iii) reward corporate performance, (iv) recognizeindividual initiative, achievement and hard work, and (v) assist the Company inattracting and retaining qualified executive officers. Currently, compensationunder the executive compensation program is comprised of cash compensation inthe form of annual base salary and bonus and long-term incentive compensationin the form of stock options.

 

***Base Salary***.******TheCompensation Committee reviews salaries periodically. The CompensationCommittee’s policy is to consider amounts paid to senior executives withcomparable qualifications, experience and responsibilities at otherpublicly-held companies of similar size and engaged in a similar type ofbusiness to that of the Company, all of whom are constituent companies of theNasdaq Computer Index. The Compensation Committee does not take into accountthe Company’s relative performance as compared to comparable companies. TheCompensation Committee also considers compensation information pertaining tothe Company’s industry including salary surveys, industry reports and otheravailable information. The Compensation Committee analyzes this information torecommend salaries. The Compensation Committee does not use a fixed or rigidformula to recommend salaries.

 

The salary compensationfor the executive officers is based upon their qualifications, experience andresponsibilities, as well as the attainment of planned objectives. Mr. Kinreich’splanned objectives included: (1) implementing the 2005 operating plan; (2)building strategic relationships; and (3) executing product release plans. TheChief Executive Officer makes recommendations to the Compensation Committeeregarding the planned objectives and executive compensation levels. The overallplans and operating performance levels upon which management compensation isbased are reviewed and approved by the Compensation Committee on a periodicbasis.

 

***Bonus Compensation****.*****Our executive officers are eligible for quarterly cashbonuses, which are based primarily on corporate achievements and individualperformance objectives that are reviewed and approved by the CompensationCommittee and established at the beginning and in the course of each year. Afterthe completion of each quarter, the Compensation Committee reviews theattainment of corporate and individual objectives and recommends bonuses basedon the extent to which corporate objectives were met or exceeded and individualcontributions to the Company’s overall performance.

 

In July 2005, as part of a plan to reduce ouroperating cash flow, we suspended payments of all quarterly cash bonuses,commencing with the second quarter of 2005. However, we have accrued estimatedbonuses for the second quarter of 2005 and thereafter based on thepre-established corporate achievements and individual performance objectives. Thepayment of all, or a portion of, the accrued suspended quarterly cash bonusesor future quarterly cash bonuses will be subject to the approval by theCompensation Committee.

 

***Stock Options****.*****The Company relies on incentive compensation in the form ofstock options to retain and motivate executive officers and employees, whichgenerally is provided through initial option grants at the date of hire andperiodic additional grants. Incentive compensation in the form of stock optionsis designed to provide long-term incentives to executive officers and other employees,to encourage the executive officers and other employees to remain with theCompany and to enable them to develop and maintain a stock ownership positionin the Company’s ordinary shares.

 

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Awards take into accounteach officer’s scope of responsibility and specific assignments, strategic andoperational goals applicable to the officer, anticipated performance andcontributions of the officer and competitive market data for similar positions.Options are granted with an exercise price equal to the fair market value ofour ordinary shares on the date of grant. The standard vesting scheduleprovides that a portion of the shares subject to each option vest and becomeexercisable annually and quarterly over three- to four-year periods.

 

Option grants toexecutive officers are based on such factors as initiative, achievement andperformance. In administering grants to executive officers, the CompensationCommittee evaluates each officer’s total equity compensation package. TheCompensation Committee generally reviews the option holdings of each of theexecutive officers, including their vesting and exercise prices and the thencurrent value of any unvested options. The Compensation Committee considers equitycompensation to be an integral part of a competitive executive compensationpackage and an important mechanism to align the interests of management withthose of the Company’s shareholders.

 
|   | By the RadView Software  Ltd. Compensation Committee |
|--------|------------------------------------------------------|
|   | Shai Beilis and David  Assia                         |

 

# **CompensationCommittee Interlocks and Insider Participation**

# ** **

Shai Beilis and DavidAssia currently constitute the Company’s Compensation Committee. None of ourexecutive officers serve as a member of the board of directors or compensationcommittee of any entity that has any executive officer serving as a member ofour Board of Directors or Compensation Committee.

 

**REPORT OF AUDIT COMMITTEE**

** **

The AuditCommittee of the Board of Directors, which consists entirely of Directors whomeet the independence and experience requirements under the Israeli CompaniesLaw and the rules of the Securities and Exchange Commission, has furnished thefollowing report:

 

The AuditCommittee assists the Board in overseeing and monitoring the integrity of theCompany’s financial reporting process, its compliance with legal and regulatoryrequirements and the quality of its internal and external audit processes. Therole and responsibilities of the Audit Committee are set forth in a writtenCharter adopted by the Board**.**The Audit Committee reviews and reassessesthe Charter annually and recommends any changes to the Board for approval.

 

Management isresponsible for the Company’s financial reporting process including its systemof internal control, and for the preparation of consolidated financialstatements in accordance with generally accepted accounting principles. TheCompany’s independent auditors are responsible for auditing those consolidatedfinancial statements. The responsibility of the Audit Committee is to monitorand review these processes. Members of the Audit Committee are not employees ofthe Company and are not required to be accountants or auditors by profession. Therefore,the Audit Committee has relied, without independent verification, on management’srepresentation that the consolidated financial statements have been preparedwith integrity and objectivity and in conformity with accounting principlesgenerally accepted in the United States and on the representations of theindependent auditors included in their report of the Company’s consolidatedfinancial statements.

 

The oversight bythe Audit Committee does not provide an independent basis to determine thatmanagement has maintained appropriate accounting and financial reportingprinciples or policies, or appropriate internal controls and proceduresdesigned to assure compliance with accounting standards and applicable laws andregulations. Furthermore, the Audit Committee cannot give assurance that theCompany’s consolidated financial statements are presented in accordance withgenerally accepted accounting principles, that the audit of the Company’sconsolidated financial statements has been carried out in accordance withgenerally accepted auditing standards or that the Company’s independentauditors are in fact “independent.”

 

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In fulfilling itsresponsibilities for the consolidated financial statements for fiscal year2005, the Audit Committee took the following actions:

 

•      Reviewedand discussed the audited consolidated financial statements for the fiscal yearended December 31, 2005 with management and Kost Forer Gabbay & Kasierer, amember of Ernst & Young Global, the Company’s independent auditors;

 

•      Discussedwith Kost Forer Gabbay & Kasierer the matters required to be discussed byStatement on Auditing Standards No. 61, *Communicationswith Audit Committees*, relating to the conduct of the audit; and

 

•      Receivedwritten disclosures and the letter from Kost Forer Gabbay & Kasierer regardingits independence as required by Independence Standards Board Standard No. 1.The Audit Committee further discussed with Kost Forer Gabbay & Kasierertheir independence. The Audit Committee also considered the status of pendinglitigation, taxation matters and other areas of oversight relating to thefinancial reporting and audit process that the Committee determinedappropriate.

 

Based on the AuditCommittee’s review of the audited consolidated financial statements anddiscussions with management and Kost Forer Gabbay & Kasierer, the AuditCommittee recommended to the Board that the audited consolidated financialstatements be included in the Company’s Annual Report on Form 10-K for thefiscal year ended December 31, 2005 to be filed with the Securities andExchange Commission.

 
|   | By the RadView Software  Ltd. Audit Committee |
|--------|-----------------------------------------------|
|   | David Assia                                   |

 

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**COMPARATIVESHARE PERFORMANCE GRAPH**

 

The following graph shows the cumulative shareholderreturn of the Company’s ordinary shares from August 10, 2000, the date of theCompany’s initial public offering, through December 31, 2005 as compared withthat of the Nasdaq Composite and the Nasdaq Computer Index. The graph assumesthe investment of $100 in the Company’s ordinary shares and each of thecomparison groups on August 10, 2000 and assumes the reinvestment of dividends.The Company has never declared a dividend on its ordinary shares. The ordinaryshare price performance depicted in the graph below is not necessarily indicativeof future price performance. This graph is not “soliciting material,” is notdeemed filed with the Securities and Exchange Commission and is not to beincorporated by reference in any filing of the Company under the Securities Actof 1933 or the Securities Exchange Act of 1934 whether made before or after thedate hereof and irrespective of any general incorporation language in any suchfiling.

 

 

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**Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT**

 

The following table sets forth certain informationknown to us regarding the beneficial ownership of our ordinary shares as ofApril 25, 2006, unless otherwise indicated, by: (i) each person known by us to beneficially own more than 5% of ourordinary shares; (ii) each Director of the Company; (iii) each executiveofficer named in the Summary Compensation Table above; and (iv) all of ourDirectors and executive officers as a group. Beneficial ownership is determinedin accordance with the rules of the Securities and Exchange Commission. Incomputing the number of shares beneficially owned by a person and thepercentage ownership of that person, ordinary shares under options and warrantsheld by that person that are currently exercisable or exercisable within 60days of April 25, 2006 are considered outstanding. These shares, however, arenot considered outstanding when computing the percentage ownership of eachother person. Except as indicated in the footnotes to this table and pursuantto state community property laws, each shareholder named in the table has solevoting and investment power for the shares shown as beneficially owned by them.Ownership percentages are based on 20,525,682 ordinary shares outstanding onApril 25, 2006. Unless otherwise noted below, the address of each of ourdirectors and executive officers is c/o RadView Software Ltd., 7 New EnglandExecutive Park, Burlington, Massachusetts 01803.

 
| **Name of Beneficial Owner:**                                                    | ** ** | **Total Shares  Beneficially Owned** | ** ** | **Percentage of  Ordinary Shares** | ** ** |
|----------------------------------------------------------------------------------|------------|--------------------------------------|------------|------------------------------------|------------|
|                                                                             |       |                                 |       |                               |       |
| Five Percent  Shareholders:                                                      |       |                                 |       |                               |       |
| Computer  Associates International, Inc. (1)                                     |       | 1,635,067                            |       | 8.0                                | %          |
| Formula Ventures  (2)                                                            |       | 1,786,480                            |       | 8.7                                | %          |
| Shem Basum Ltd.  (2)                                                             |       | 1,705,809                            |       | 8.3                                | %          |
| Zohar Zisapel  (3)                                                               |       | 2,079,522                            |       | 10.1                               | %          |
| Yehuda Zisapel  (4)                                                              |       | 2,079,522                            |       | 10.1                               | %          |
|                                                                             |       |                                 |       |                               |       |
| Directors and  Executive Officers:                                               |       |                                 |       |                               |       |
| Ilan Kinreich  (5)                                                               |       | 929,005                              |       | 4.4                                | %          |
| Christopher  Dineen (6)                                                          |       | 159,560                              |       |                               | *          |
| Shai Beilis (2)  (7)                                                             |       | 3,642,289                            |       | 17.6                               | %          |
| David Assia (8)                                                                  |       | 150,000                              |       |                               | *          |
| Yochai Hacohen                                                                   |       | —                               |       | —                             |       |
| Eli Blatt                                                                        |       | —                               |       | —                             |       |
| All executive  officers and Directors as a group (6 persons) (2) (5) (6) (7) (8) |       | 4,880,854                            |       | 22.7                               | %          |

 

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* Represents beneficialownership of less than one percent of our ordinary shares.

 

(1)   ComputerAssociates International, Inc. is a public company traded on The New York StockExchange. Based on its annual report on Form 10-K for the year ended March 31,2005 filed with the SEC on June 29, 2005, and its quarterly report on Form 10-Qfor the quarter ended December 31, 2005 filed with the SEC on February 9, 2006,its directors are Kenneth D. Cron, Alfonse M. D’Amato, Gary J. Fernandes**,** Robert E. La Blanc, Jay W. Lorsch, William E. McCracken,Lewis S. Ranieri, Walter P. Schuetze, John A. Swainson, Laura S. Unger and RonZambonini. The address of Computer Associates International, Inc. is OneComputer Associates Plaza, Islandia, NY 11749.

 

(2)   Informationis derived in part from Amendment No. 2 to the Schedule 13G/A, filed onFebruary 20, 2004 by Formula Ventures L.P., FV-PEH, L.P. and Formula Ventures(Israel) L.P and Schedule 13G filed on January 17, 2006 by Shem Basum Ltd. Includes1,108,593 ordinary shares owned of record by Formula Ventures L.P; 311,947ordinary shares owned of record by FV-PEH L.P.; 356,140 ordinary shares ownedof record by Formula Ventures (Israel) L.P.; 1,705,809 ordinary shares owned ofrecord by Shem Basum Ltd. Shai Beilis, one of our Directors, is the managingdirector of Formula Ventures L.P. and Formula Ventures Ltd. Shai Beilis is alsothe principal shareholder and a director of Shem Basum Ltd and directly holds9,800 of our ordinary shares. Shai Beilis disclaims beneficial ownership of theshares held of record by Formula Ventures L.P., FV-PEH L.P. and FormulaVentures (Israel) L.P. except to the extent of his pecuniary interest therein.Shai Beilis

 

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has sole voting andinvestment power and is the beneficial owner of the 1,705,809 ordinary sharesowned of record by Shem Basum Ltd. Formula Ventures L.P., FV-PEH L.P. andFormula Ventures (Israel) L.P. are part of an affiliated group of investmententities managed by Formula Ventures Ltd. and Formula Ventures Partners (CaymanIslands) Ltd., a subsidiary thereof. Micha Gaiger, Yigal Erlich, Shai Beilis,Nir Linchevski and Dan Goldstein, by virtue of their board positions in FormulaVenture Ltd., and Shai Beilis and Nir Linchevski, by virtue of their boardpositions in Formula Venture Partners (Cayman Islands) Limited, each sharevoting and dispositive power with respect to the shares held by FormulaVentures L.P.; FV-PEH and Formula Ventures (Israel) L.P. Decisions with respectto voting and investment of the shares owned of record are made by majorityvote and as managing director, Shai Beilis shares voting and investment powerover the ordinary shares held by Formula Ventures L.P., FV-PEH L.P. and FormulaVentures (Israel) L.P. The address of Formula Ventures (Israel) L.P., FormulaVentures L.P. and FV-PEH L.P. is 11 Galgalei Haplada St., Herzliya, Israel46733.

 

(3)   Represents693,252 ordinary shares owned of record by Zohar Zisapel, 693,135 ordinaryshares owned of record by Michael and Klil Holdings (93) Ltd., and 693,135ordinary shares owned of record by Lomsha Ltd. Zohar Zisapel is a principalshareholder and a director of each of Michael and Klil Holdings (93) Ltd. andLomsha Ltd. Zohar Zisapel’s address is 24 Raoul Wallenberg Street, Tel Aviv,Israel, 69719.

 

(4)   YehudaZisapel’s address is 24 Raoul Wallenberg Street, Tel Aviv, Israel, 69719.

 

(5)   Includes520,000 options exercisable within 60 days of April 25, 2006.

 

(6)   Includes158,375 options exercisable within 60 days of April 25, 2006.

 

(7)   Includes150,000 options exercisable within 60 days of April 25, 2006.

 

(8)   Represents150,000 options exercisable within 60 days of April 25, 2006.

 

**EQUITYCOMPENSATION PLAN INFORMATION**

 

The following table setsforth certain information, as of December 31, 2005, regarding the Company’sequity compensation plans.

 
| **Plan Category**                                               | ** ** | **Number of  securities to be  issued upon exercise  of outstanding  options, warrants  and rights** | ** ** | **Weighted-average  exercise price of  outstanding  options, warrants  and rights** | ** ** | **Number of securities  remaining available for  future issuance under  equity compensation  plans (excluding  securities reflected  in column (a))** | ** ** |
|-----------------------------------------------------------------|------------|------------------------------------------------------------------------------------------------------|------------|-------------------------------------------------------------------------------------|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------|------------|
| ** **                                                      | ** ** | **(a)**                                                                                              | ** ** | **(b)**                                                                             | ** ** | **(c)**                                                                                                                                               | ** ** |
| Equity  compensation plans approved by security holders (1)     |       | 2,022,411                                                                                            |       | $                                                                                   | 0.37       |                                                                                                                                                  | 3,211,833  |   |
| Equity  compensation plans not approved by security holders (2) |       | 1,010,469                                                                                            |       | $                                                                                   | 0.35       |                                                                                                                                                  | 1,651,730  |   |
| Total                                                           |       | 3,032,880                                                                                            |       | $                                                                                   | 0.36       |                                                                                                                                                  | 4,863,563  |   |

 

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(1)   Relatesto 2,950,000 options issued or issuable under the Company’s U.S. ShareIncentive Plan (2000) and 1,200,000 options available for issuance under theCompany’s Key Employee Share Incentive Plan (1996). Also includes 1,500,000ordinary shares available for purchase by employees under the Company’sEmployee Share Purchase Plan. After the date of shareholder approval of thereservation of options under the Key Employee Share Incentive Plan, the Boardof Directors amended certain provisions of the plan to comply with changes inthe Israeli Income Tax Ordinance and Tax Regulations. These changes weresubmitted to the Israeli tax authorities for their approval.

 

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(2)   Relatesto options issued or issuable under the Company’s Key Employee Share IncentivePlan (1996) (other than 1,200,000 options issuable under such plan that havereceived the approval of the Company’s security holders) and options issuedunder the Company’s Affiliate Employees Option Plan.

 

**MaterialFeatures of the Key Employee Share Incentive Plan (1996)**

 

The Key Employee Plan isadministered by the Compensation Committee, which has the authority to submitrecommendations to the Board of Directors as to the issuance of options underthe plan. All employees, directors and consultants of the Company and itsaffiliates are eligible to participate in the Key Employee Plan.

 

Options granted under theKey Employee Plan after January 1, 2003 are intended to comply with the “capitalgains” provision of Section 102 of the Israeli Income Tax Ordinance.

 

Stock options grantedunder the Key Employee Plan may not be granted at a price less than the parvalue of the ordinary shares on the date of grant. If any option award, or anypart thereof, under the Key Employee Plan has not been exercised and the sharescovered thereby not paid for within sixty-two (62) months after the date ofgrant (or any other period set forth in the instrument granting such optionaward), such option award, or such part thereof, terminates. An option grantedunder the Key Employee Plan is exercisable, during the optionholder’s lifetime,only by the optionholder and is not transferable by him or her except by willor by the laws of descent and distribution.

 

After the termination ofan optionholder’s employment with the Company, or cessation of status as adirector or consultant of the Company (other than by reason of death,disability or termination for cause as defined in the Key Employee Plan), allrights in respect of options granted under the Key Employee Plan and held atthe date of termination terminate within two weeks after the termination orcessation of status. Generally, in the event of the optionholder’s terminationfor cause, all outstanding and unexercised options granted under the KeyEmployee Plan are forfeited.

 

The Key Employee Plan maybe amended by the Board of Directors of the Company. Each grantee isresponsible for all personal tax consequences of the grant, the exercise andthe sale of shares thereof.

 

#### **Item13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS**

####  

**None.**

 

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**SIGNATURES**

 

**Pursuant to the requirements of the SecuritiesExchange Act of 1934, as amended, the Registrant has duly caused this report tobe signed on its behalf by the undersigned, thereunto duly authorized.**

 
| **RADVIEW SOFTWARE LTD.**   |
|-----------------------------|
|                        |
|                        |
| **By:**                     | **/s/ CHRISTOPHER DINEEN** |   |
| **Christopher Dineen**      |
| **Chief Financial Officer** |
|                        |
| **May 1, 2006**             |

 

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