EXHIBIT 10.32

This  note  supercedes  and  replaces  the note dated December 20, 1999 executed
by  the  Borrower  in  favor  of  the  Bank  in  the  amount  of  $10,000,000.00

PROMISSORY  NOTE


U.S.  $10,000,000.00
     --------------

March  16,  2000  New  York,  New  York
--------------

1.     OBLIGATION  AND  REPAYMENT:  For  value received, Borrower absolutely and
       unconditionally  promises to pay to the order of the Bank, at the Office,
       without  defense,  setoff  or  counterclaim,  the principal amount of Ten
       Million  and 00/100 United States Dollars, together with interest and any
       other  sum(s)  due  as specified below. The principal amount of this Note
       shall  be  due  and  payable as follows (complete one of the following as
       applicable):

       (A)    [  ]  ON  DEMAND.

       (B)    On  May  31,  2001;  and

       (C)    In  consecutive  installments, of which each but the last shall be
              $_____________  and  the  last of which shall be equal to the then
              unpaid  principal balance of this Note. The first such installment
              shall  be due on ______________, 19__. Each subsequent installment
              shall  be  due  on  the  corresponding day of each month/ quarter/
              other  __________ thereafter (or if there is no such corresponding
              day,  on  the  last  day  of such period). The remaining principal
              balance  shall  be  due  on  ______________,  19__.

       (D)    [X]  In  accordance  with  the  attached  Rider.

2.     INTEREST: Subject to paragraph A(2) of the Terms and Conditions, interest
       shall  accrue  on the principal amount of this Note outstanding from time
       to  time  at  the  following  rate (the "Loan Rate") (complete one of the
       following  as  applicable):

       (A)    A  fixed  rate  equal  to  ______%  per  year.

       (B)    A  Variable  Prime-Based Rate equal to the Prime Rate plus ______%
              per  year.

       (C)    [X]  In  accordance  with  the  attached  Rider.

       Interest  shall  be payable monthly/ quarterly/ (other) _____________ and
       at any Payment Date and at any time that any part of the principal or any
       installment  of  this  Note  is  paid.

3.     RIDERS:  IN  THE  EVENT  OF  ANY  INCONSISTENCY BETWEEN THIS NOTE AND ANY
       RIDER(S)  TO  WHICH THIS NOTE IS SUBJECT, THE PROVISIONS OF SUCH RIDER(S)
       SHALL  PREVAIL.  THIS  NOTE  IS  SUBJECT  TO  ANY RIDER(S) REFERRED TO IN
       PARAGRAPH  1(D)  AND/OR  2(C) AND TO THE FOLLOWING RIDER(S), ALL OF WHICH
       ARE  PART  OF  THIS  NOTE:

                  Multiple-Loan  Rider  to  Promissory  Note
                  --------------------------------------
                           (Libor-Based  Rate)

4.     ADDRESS  AND  IDENTIFICATION  OF  BORROWER:

       Address:   800  Regency  Parkway
               ---------------------------------------------------------
                  Cary,  NC  27511
               ---------------------------------------------------------
       Telex  or  similar  number:
                               -----------------------------------------
       Answerback:
                  ------------------------------------------------------
       Telecopy  or  similar  number:
                                  --------------------------------------
       Social  Security  or  Taxpayer  ID  number:
                                             ---------------------------

5.     AGREEMENT  TO  ALL TERMS AND CONDITION; AUTHORIZATION TO COMPLETE BLANKS:
       THIS  NOTE  IS SUBJECT TO THE TERMS AND CONDITIONS SET FORTH BELOW AND ON
       THE  REVERSE  SIDE OF THIS NOTE. EACH OF THE UNDERSIGNED AGREES TO ALL OF
       THE  PROVISIONS  OF THIS NOTE, INCLUDING THE TERMS AND CONDITIONS AND ANY
       RIDER(S).  THE  BANK  IS  AUTHORIZED  TO COMPLETE ANY BLANK SPACE IN THIS
       NOTE.  SUCH COMPLETION SHALL BE CONCLUSIVE, FINAL AND BINDING ON BORROWER
       IN  THE  ABSENCE  OF  MANIFEST  ERROR.

6.     NO  REPRESENTATIONS  OR  AGREEMENTS  BY THE BANK: EACH OF THE UNDERSIGNED
       ACKNOWLEDGES  THAT  THE  BANK  HAS  MADE  NO  REPRESENTATION,  COVENANT,
       COMMITMENT  OR  AGREEMENT  TO  BORROWER  EXCEPT  PURSUANT  TO ANY WRITTEN
       DOCUMENT  EXECUTED  BY  THE  BANK.

7.     NO REPRESENTATION OF NONENFORCEMENT: EACH OF THE UNDERSIGNED ACKNOWLEDGES
       THAT  NO REPRESENTATIVE OR AGENT OF THE BANK HAS REPRESENTED OR INDICATED
       THAT  THE BANK WILL NOT ENFORCE ANY PROVISION OF THIS NOTE, INCLUDING THE
       TERMS  AND  CONDITIONS  AND  ANY  RIDER(S), IN THE EVENT OF LITIGATION OR
       OTHERWISE.

8.     WAIVER  OF  JURY  TRIAL:  BORROWER  WAIVES, AND UNDERSTANDS THAT THE BANK
       WAIVES,  THE  RIGHT  TO  A JURY TRIAL WITH RESPECT TO ANY DISPUTE ARISING
       HEREUNDER  OR RELATING TO ANY OF THE LIABILITIES; ANY JUDICIAL PROCEEDING
       WITH  RESPECT  TO  ANY  SUCH  DISPUTE  SHALL  TAKE  PLACE WITHOUT A JURY.

9.     EXECUTION  OF  PROMISSORY  NOTE:

       Print  name  of  Borrower:  Level  8  Systems,  Inc.
                               -------------------------------------------------
       (Signature)  By:        /s/  Steven  Dmiszewicki
                      ----------------------------------------------------------
       Print  name:            Steven  Dmiszewicki
                      ----------------------------------------------------------
       Title  or  capacity:     President
                         -------------------------------------------------------
       (if  signing  on  behalf  of  Borrower)
       (Signature)  By:        /s/  Dennis  McKinnie
                      ----------------------------------------------------------
       Print  Name:            Dennis  McKinnie
                      ----------------------------------------------------------
       Title  or  capacity:     SVP,  Secretary
                         -------------------------------------------------------
       (if  signing  on  behalf  of  Borrower)

================================================================================

                              TERMS  AND  CONDITIONS

Definitions  are  set  forth  in  paragraph  M

A.     CALCULATION  AND  ACCRUAL  OF INTEREST: (1) GENERALITY. Interest shall be
       calculated  on  a  daily  basis on outstanding balances at the Applicable
       Rate,  divided  by  360, on the actual days elapsed. During any time that
       the  Applicable  Rate  would exceed the applicable maximum lawful rate of
       interest,  the  Applicable  Rate  shall  automatically be reduced to such
       maximum  rate.  Any  interest payment made in excess of such maximum rate
       shall be applied as, and deemed to be, in the Bank's sole discretion, (a)
       a  payment of any of the Liabilities, in such manner as determined by the
       Bank,  or  (b)  cash  collateral  to  be  retained  by the Bank to secure
       repayment  of this Note. (2) INCREASED RATE. Interest shall accrue at the
       Increased  Rate  upon  and  after (a) the occurrence of any Debtor Relief
       Action,  (b) any demand of payment of this Note (if payable on demand) or
       (c) the occurrence of any Event of Default (if this Note is payable other
       than  on  demand).  (3) ACCRUAL. To the extent permitted by Law, interest
       shall  accrue at the Applicable Rate on all unpaid Liabilities under this
       Note,  including  but  not  limited to any unpaid interest and any unpaid
       obligation  owed  pursuant  to  paragraph  B  (Indemnification).

B.     INDEMNIFICATION:  To the extent permitted by Law: (1) TAXES: All payments
       under  this  Note  shall be made free and clear of, and without deduction
       for,  any  Taxes.  If  Borrower  shall be required to deduct any Taxes in
       respect  of  any  sum  payable  under this Note, then (a) the sum payable
       shall  be increased so that the Bank shall receive an amount equal to the
       sum  the  Bank  would  have received had no deductions been made, and (b)
       Borrower  shall make such deductions and shall pay the amount deducted to
       the  relevant  Governmental  Authority. Borrower shall pay to the Bank on
       demand,  and shall indemnify and hold the Bank harmless from, any and all
       Taxes  paid  by  the Bank and any and all liability (including penalties,
       interest  and  expenses)  with respect thereto, whether or not such Taxes
       were  correctly  or  legally asserted. Within 30 days after any Taxes are
       paid, Borrower shall furnish evidence thereof to the Bank. (2) REGULATORY
       COSTS.  In  the  event  that  in  connection

       with  the  transaction(s),  contemplated  by  this Note and/or the Bank's
       funding  of  such  transaction(s),  the  Bank  is  required  to incur any
       Regulatory Costs in order to comply with any Law issued after the date of
       this  Note,  then  Borrower  shall  pay  the  Bank  on  demand, and shall
       indemnify  and  hold  the  Bank harmless from any and all such Regulatory
       Costs. (3) COSTS AND EXPENSES. Borrower shall pay the Bank on demand, and
       shall  indemnify  and  hold the Bank harmless from, any and all costs and
       expenses.  (4) PREPAYMENT COSTS. If Borrower makes any payment of Prepaid
       Principal  (voluntarily  or not), and if the Applicable Rate with respect
       to  such  Prepaid  Principal  is  not  a  Variable Prime-Based Rate, then
       Borrower  shall  pay  to  the Bank an amount sufficient to compensate the
       Bank for its Prepayment Costs. Borrower acknowledges that determining the
       actual  amount  of Prepayment Costs may be difficult or impossible in any
       specific  instance.  Accordingly,  Borrower  agrees that Prepayment Costs
       shall  be  deemed to be the excess, if any, of (i) the product of (A) the
       Prepaid  Principle,  times  (B) the Applicable Rate divided by 360, times
       (C)  the  remaining  number  of  days from the date of the payment to the
       applicable Payment Date, over (ii) that amount of interest which the Bank
       determines  that the holder of a Treasury Obligation selected by the Bank
       in  the  amount  (or  as close to such amount as feasible) of the Prepaid
       Principal  and  having  a maturity date on (or as soon after as feasible)
       the  applicable  Payment Date would earn if that Treasury Obligation were
       purchased  in  the  secondary market on the date the Prepaid Principal is
       paid  to  the  Bank  and  were held to maturity. Borrower agrees that the
       determination  of  Prepayment  Costs  shall  be  based on amounts which a
       holder  of a Treasury Obligation could receive under these circumstances,
       whether  or  not  the  Bank actually invests the Prepaid Principal in any
       Treasury  Obligation.  (5) BANK CERTIFICATE. The Bank's certificate as to
       any  amounts  owing under this paragraph shall be prima facia evidence of
       Borrower's  obligation.

C.     SET  OFF:  Every  Account of Borrower with the Bank shall be subject to a
       lien  and  to  being set off against the Liabilities. The Bank may at any
       time  at its option and without notice, except as may be required by law,
       charge  and/or  appropriate and apply all or any part of any such Account
       toward  the  payment  of  any  of  the  Liabilities.

D.     EVENTS  OF  DEFAULT: The remainder of this paragraph D shall not apply if
       this  Note  is payable on demand. Each of the following shall be an Event
       of  Default hereunder: (1) NONPAYMENT. (a) The nonpayment when due of any
       part of the Liabilities; (b) the prohibition by any Law of payment of any
       part  of any of the Liabilities; (2) BANKRUPTCY; ADVERSE PROCEEDINGS. (a)
       The  occurrence  of  any  Debtor  Relief Action; (b) the appointment of a
       receiver,  trustee,  committee,  custodian,  personal  representative  or
       similar  official  for  any Party or for any Material part of any Party's
       property;  (c)  any  action taken by any Party to authorize or consent to
       any  action  set  forth in subparagraph D(2)(a) or (b); (d) the rendering
       against  any  Party  of  one  or  more  judgments, orders, decrees and/or
       arbitration  awards  (whether  for  the payment of money or injunctive or
       other  relief) which in the aggregate are Material to such Party, if they
       continue in effect for 30 days without being vacated, discharged, stayed,
       satisfied  or  performed;  (e)  the  issuance  or  filing of any warrant,
       process,  order  of attachment, garnishment or other lien or levy against
       any  Material  part  of any Party's property; (f) the commencement of any
       proceeding  under, or the use of any of the provisions of any Law against
       any  Material  part of any Party's property, including but not limited to
       any  Law  (i)  relating to the enforcement of judgments or (ii) providing
       for  forfeiture  to,  or  condemnation,  appropriation, seizure or taking
       possession  by,  or  on  order  of  any  Governmental  Authority; (g) the
       forfeiture  to,  or  the  condemnation,  appropriation, seizure or taking
       possession  by,  or  on  the order of, any Governmental Authority, of any
       Material part of any Party's property; (h) any Party being charged with a
       crime  by indictment, information or the like. (3) NONCOMPLIANCE. (a) Any
       Default with respect to any Agreement with or to the Bank, (b) the giving
       to  the  Bank  by or on behalf of any Party at any time of any materially
       incorrect  or  incomplete  representation,  warranty,  statement  or
       information;  (c) the failure of any Party to furnish to the Bank, copies
       of  its  financial  statements  and such other information respecting its
       business,  properties,  condition  or operations, financial or otherwise,
       promptly  when,  and in such form as, reasonably required or requested by
       the Bank; (d) any Party's failure or refusal, upon reasonable notice from
       the  Bank,  to  permit the Bank's representative(s) to visit such Party's
       premises  during  normal  business  hours  and  to  examine  and  make
       photographs,  copies  and  extracts  of  such Party's property and of its
       books  and records; (e) any Party's concealing, removing or permitting to
       be  concealed  or  removed,  any  part of its property with the intent to
       hinder  or  defraud  any  of  its  creditors;  (f)  any Party's making or
       suffering  any  Transfer of any of its property, which Transfer is deemed
       fraudulent  under  the  law  of  any  applicable  jurisdiction;  (g)  the
       revocation  or  early  termination  of  any Party's obligations under any
       Agreement  with  or to the Bank (including, but not limited to any of the
       Liabilities)  or  the  validity,  binding effect or enforceability of any
       such  obligations  being  challenged or questioned, whether or not by the
       institution  of proceedings. (4) ADVERSE CHANGES. (a) the occurrence of a
       Material adverse change in any Party's financial condition; (b) the death
       or  incompetence  (if  a  person) or the dissolution or liquidation (if a
       corporation,  partnership  or  other entity) of any Party or such Party's
       failure to be and remain in good standing and qualified to do business in
       each  jurisdiction  Material to such Party; (c) any Material Default with
       respect to any Material Agreement other than with or to the Bank; (d) any
       Default  pursuant  to  which any Person shall have the power to effect an
       Acceleration  of  any  Material  Debt;  (e) any Acceleration or demand of
       payment  with  respect  to  any  Material  Debt; (f) any Party's becoming
       insolvent,  as  defined  in  the  Uniform Commercial Code; (g) the Bank's
       believing  in  good  faith  that  the  prospect  of payment of any of the
       Liabilities or of performance of any other obligation of any Party to the
       Bank  is  impaired;  (h) the Material suspension of any Party's business;
       (i)  any  Party's  Material  failure  to  pay  any  tax when due; (j) the
       expulsion  of any Party from any exchange or self-regulatory organization
       or any loss, suspension, nonrenewal or invalidity of any Party's Material
       license, permit, franchise, patent, copyright, trademark or the like; (k)
       the  occurrence of any event which gives any Person the right to assert a
       lien,  levy  or  right  of  forfeiture  against  any Material part of any
       Party's  property; (l) Borrower's failure to give the Bank notice, within
       10  Business  Days  after  Borrower  had  notice  or  knowledge,  of  the
       occurrence  of any event which, with the giving of notice and/or lapse of
       time, would constitute an Event of Default. (5) BUSINESS CHANGES. (a) any
       change in Control of any Party; (b) any merger or consolidation involving
       any Party; (c) any Party's sale or other Transfer or substantially all of
       its  property; (d) any bulk sale by any Party; (e) any Material change in
       the  nature  or structure of any Party's business. (6) EXCHANGE CONTROLS.
       (a)  Any  Party's failure to obtain any Exchange Control Permit deemed by
       the  Bank  to  be necessary or appropriate; (b) the failure to obtain the
       renewal of any such Exchange Control Permit at least 30 days prior to its
       expiration.

E.     REMEDIES: (1) ACCELERATION AT BANK'S OPTION. Upon any failure to pay this
       Note in full on demand (if payable on demand) or (if this Note is payable
       other  than  on  demand)  upon  the  occurrence  of  any  Event


                                       2

       of  Default  other  than  any  Debtor  Relief  Action,  then  any and all
       Liabilities,  not  then  due,  shall,  at  the  Bank's  option,  become
       immediately  due  and  payable without notice, which Borrower waives. (2)
       AUTOMATIC  ACCELERATION. Upon the occurrence of any Debtor Relief Action,
       then,  whether  or not any of the Liabilities are payable upon demand and
       notwithstanding paragraph F, any and all Liabilities, not then due, shall
       automatically  become  immediately  due  and  payable  without  notice or
       demand,  which  Borrower  waives. (3) Additional Remedies. The Bank shall
       have  all  rights  and  remedies  available  to  it  under any applicable
       Agreement  or  Law.

F.     WAIVER OF PROTEST, ETC.: Notice, presentment, protest, notice of dishonor
       and  except  for  such  of  the Liabilities as are payable on demand, but
       subject  to  subparagraph E(2) demand for payment are hereby waived as to
       all  of  the  Liabilities.

G.     PAYMENT:  (1)  MANNER.  Any  payment  by other than immediately available
       funds  shall  be subject to collection, interest shall continue to accrue
       until  the  funds  by which payment is made are available to the Bank. If
       and  to the extent any payment of any of the Liabilities is not made when
       due,  the  Bank  is  authorized  in  its  discretion to effect payment by
       charging  any amount so due against any Account of Borrower with the Bank
       without  notice,  except  as  may be required by law, whether or not such
       charge creates an overdraft. (2) Application. Any payment received by the
       Bank  (including  a  deemed  payment  under  paragraph A, a set-off under
       paragraph  C or a charge against an Account under this paragraph G) shall
       be  applied  to  pay any obligation of indemnification (including but not
       limited to under paragraph B) and to pay any other Liabilities (including
       interest  thereon  and  the  principal thereof) in such order as the Bank
       shall  elect  in  its discretion. Borrower will continue to be liable for
       any  deficiency.  (3)  PREPAYMENT.  Borrower shall be entitled to pay any
       outstanding  principal  amount  or  installment  under  this  Note on any
       Business  Day  prior  to  the  applicable  Payment Date without the prior
       consent  of the Bank provided that (a) any such payment shall be together
       with  payment of all Liabilities then due and all interest accrued on the
       Prepaid  Principal to the date of such payment, and (b) if the Applicable
       Rate with respect to such Prepaid Principal is not a Variable Prime-Based
       Rate,  any such payment shall be on not less than 5 Business Day's notice
       to  the  Bank and shall be accompanied by any amount required pursuant to
       subparagraph  B(4). Any such payment shall, unless otherwise consented to
       by  the  Bank,  be  applied  pro  rata  to the last outstanding principal
       amount(s) to become due under this Note in inverse order of maturity. (4)
       NON-BUSINESS DAYS. If any payment of any of the Liabilities is due on any
       day  that is not a Business Day, it shall be payable on the next Business
       Day.  The  additional  day(s)  shall  be  included  in the compilation of
       interest. (5) EXTENSION AT BANK'S OPTION. The Bank shall have the option,
       which  may  be  exercise  one  or more times by notice(s) to Borrower, to
       extend  the  date on which any amount is payable hereunder to one or more
       subsequent  date(s)  set  forth  in  such  notice(s).

H.     PARTIES;  NO  TRANSFER  BY BORROWER: If Borrower is more than one Person,
       all  of  them  shall  be jointly and severally liable under the Note. The
       obligations  under  this  Note  shall  continue  in force and shall apply
       notwithstanding any change in the membership of any partnership executing
       this  Note,  whether  arising from the death or retirement of one or more
       partners or the accession of one or more new partners. Without the Bank's
       written consent, Borrower shall have no right to make any Transfer of any
       of the Liabilities, any such purported Transfer shall be void. Subject to
       the foregoing, the provisions of this Note shall be binding on Borrower's
       executors,  administrators,  successors  and  assigns.

I.     BANK  TRANSFERS:  (1) TRANSFERABILITY. Without limiting the Bank's rights
       hereunder,  the  Bank  may  make a Transfer of all or any part of (a) any
       obligation  of  Borrower to the Bank (including but not limited to any of
       the  Liabilities);  (b)  any  obligation of any other Party in connection
       with any of the Liabilities; (c) any Agreement of any Party in connection
       with  any  of  the  Liabilities;  (d)  any  collateral, mortgage, lien or
       security  interest, however denominated, securing any of the Liabilities;
       and/or (e) the Bank's rights and, if any, obligations with respect to any
       of  the  foregoing.  (2)  EXTENT OF TRANSFER. In the event the Bank shall
       make  any  Transfer  of any of the foregoing items ("Transferred Items"),
       then  - to the extent provided by the Bank with respect to such Transfer,
       the  Transferee shall have the rights, powers, privileges and remedies of
       the  Bank.  The Bank shall thereafter, to the extent of such Transfer, be
       forever  relieved  and  fully  discharged  from  all  liability  or
       responsibility,  if  any,  that  it  may  have to any Person with respect
       thereto,  except  for  claims,  if  any,  arising  prior  to or upon such
       Transfer. The Bank shall retain all its rights and powers with respect to
       any  Transferred  items  to  the  extent  that it has not made a Transfer
       thereof.  Without  limiting  the  foregoing,  to  the  extent of any such
       Transfer,  paragraph  B  (indemnification)  shall  apply  to  any  Taxes,
       Regulatory Costs, Costs and Expenses and Prepayment Costs of, or incurred
       by,  any Transferee, and paragraphs C (Set-Off) and G(1) (Payment-Manner)
       shall  apply  to  any  Account  of  Borrower  with  any  Transferee.  (3)
       DISCLOSURES.  The  Bank  is  authorized to disclose to any prospective or
       actual Transferee any information that the Bank may have or acquire about
       Borrower and any information about any other Person submitted to the Bank
       by  or  on behalf of Borrower. (4) NEGOTIABILITY DEFENSES WAIVED. IF THIS
       NOTE IS NOT A NEGOTIABLE INSTRUMENT, BORROWER WAIVES ALL DEFENSES (EXCEPT
       SUCH  DEFENSES  AS  MAY  BE  ASSERTED AGAINST A HOLDER IN DUE COURSE OF A
       NEGOTIABLE  INSTRUMENT)  WHICH  BORROWER  MAY HAVE OR ACQUIRE AGAINST ANY
       TRANSFEREE  WHO  TAKES  THIS NOTE, OR ANY COMPLETE OR PARTIAL INTEREST IN
       IT, FOR VALUE, IN GOOD FAITH AND WITHOUT NOTICE THAT IT IS OVERDUE OR HAS
       BEEN  DISHONORED  OR OF ANY DEFENSE AGAINST OR CLAIM TO IT ON THE PART OF
       ANY  PERSON.

J.     NO  ORAL  CHANGES;  NO WAIVER BY THE BANK; PARTIAL UNENFORCEABILITY. This
       Note  may  not  be changed orally. Neither a waiver by the Bank of any of
       its  options, powers or rights in one or more instances, nor any delay on
       the part of the Bank in exercising any of them, nor any partial or single
       exercise  thereof,  shall  constitute  a  waiver  thereof  in  any  other
       instance.  Any  provision of this Note which is prohibited, unenforceable
       or  not authorized in any jurisdiction shall, as to such jurisdiction, be
       ineffective  to  the  extent  of  such  prohibition,  unenforceability or
       non-authorization,  without  invalidating the remaining provisions of the
       Note  in  that  or  any  other  jurisdiction  and  without  affecting the
       validity,  enforceability  or  legality  of  such  provision in any other
       jurisdiction.

K.     DISPUTES  AND LITIGATION: (1) GOVERNING LAW. This Note and the rights and
       obligations  of  the Bank and Borrower hereunder shall be governed by the
       internal  laws of the State of New York without giving effect to conflict
       of  laws  principles.  (2)  JURISDICTION,  VENUES AND SERVICE OF PROCESS.
       Borrower  submits  to  the  nonexclusive  jurisdiction of the federal and
       state  courts in the State of New York in New York County with respect to
       any  dispute  that  may be made on Borrower by personal deliver at, or by
       mail addressed to, any address to which the Bank is authorized to address
       notices  to  Borrower. (3) WAIVER OF DEFENSES, SETOFFS, COUNTERCLAIMS AND
       CERTAIN  DAMAGES. Borrower waives the right to assert any defense, setoff
       or counterclaim in any proceeding relating in any way to this Note or any
       transaction  contemplated  hereby.  The Bank shall not have any liability
       for  negligence,


                                       3

       except  solely  to  the  extent required by law and not disclaimable, and
       except  for its own gross negligence or willful misconduct. In any event,
       the  Bank  shall not have any liability for any special, consequential or
       punitive  damages.  (4)  SOVEREIGN IMMUNITY. Borrower irrevocably waives,
       with  respect  to itself and its property, any sovereign immunity that it
       may have or hereafter acquire, including but not limited to immunity from
       the  jurisdiction  of  any court, from any legal process, from attachment
       prior to judgment, from attachment in aid of execution, from execution or
       otherwise.

L.     NOTICE.  Any notice in connection with any of the Liabilities shall be in
       writing  and  may be delivered personally or by cable, telex, telecopy or
       other  electronic  means  of  communication, or by certified mail, return
       receipt  requested,  addressed  (a) to Borrower as set forth herein or to
       any  other  address  that the Bank believes to be Borrower's address, and
       (b)  to  the Bank at Bank Hapoalim B.M., 1177 Avenue of the Americas, New
       York,  New York 10036, Attention Legal Department. Any such notices shall
       be  addressed  to  such other address(es) as may be designated in writing
       hereafter.  All  such  notices  shall  be  deemed  given  when  delivered
       personally  or  electronically or when mailed, except notice of change of
       address,  which  shall  be  deemed  to  have  been  given  when received.

M.     DEFINITIONS.  The  following  definitions  apply  in  this  Note:  (1)
       ACCELERATION. Any acceleration of payment of requirement of prepayment of
       any  Debt,  or  any  Debt's  becoming  due  and  payable  prior to stated
       maturity.  (2)  ACCOUNT:  (a) the balance of any account of Borrower with
       any  Person,  (b) any claim of Borrower against any Person and/or (c) any
       property  in  the possession or custody of, or in transit to, any Person,
       whether  for  safekeeping,  collection,  pledge or otherwise, as to which
       Borrower  has any right, power or interest, in each case whether existing
       now  or  hereafter,  in  any  jurisdiction  worldwide, and whether or not
       disconnected  in  the  same  currency  as  any  of  the  Liabilities. (3)
       AGREEMENT. Any agreement or instrument (including but not limited to this
       Note),  no  matter  when  made, under which any Party is obligated to any
       Person. (4) APPLICABLE RATE. Whichever of the Loan Rate or Increased Rate
       is the applicable interest rate at any time. (5) BANK: Bank Hapoalim B.M.
       (6) BORROWER. The Person(s) executing this Note at paragraph 9 or any one
       or  more  of  them.  "Borrower"  may  refer  to  one or more Persons. (7)
       BUSINESS  DAY.  Any  day  on  which both (a) banks are regularly open for
       business  in  New  York  City  and  (b)  the  Office is open for ordinary
       business  in  the  Bank's  discretion,  the  Office  may be closed on any
       Saturday,  Sunday,  legal  holiday  or  other day on which it is lawfully
       permitted  to close. (8) CONTROL. The power, alone or in conjunction with
       others, directly or indirectly, through voting securities, by contract or
       otherwise,  to direct or cause the direction of a Person's management and
       policies.  (9)  COSTS  AND  EXPENSES.  Any  and  all reasonable costs and
       expenses (including but not limited to attorneys' fees and disbursements)
       incurred  in  connection  with  the  Borrower  and/or  the  Liabilities,
       including  but  not limited to those for (a) any action taken, whether or
       not  by  litigation,  to  collect, or to protect rights or interests with
       respect  to,  or  to  preserve  any  collateral  securing,  any  of  the
       Liabilities;  (b)  compliance  with  any  legal  process  or any order or
       directive  of  any  Governmental Authority with respect to any party; (c)
       any  litigation or administrative proceeding relating to any Party and/or
       (d)  any amendment, modification, extension or waiver with respect to any
       of  the  Liabilities.  (10)  DEBT. Any Party's obligation of any sort (in
       whole  or  in  part  for  the payment of money to any Person, whether (a)
       absolute  or  contingent, (b) secured or unsecured, (c) joint, several or
       independent,  (d) nor or hereafter existing, or (e) due or to become due.
       (11)  DEBTOR  RELIEF  ACTION.  The  commencement  by any Party or (unless
       dismissed  or  terminated  within  30  days)  against  any  Party  of any
       proceeding  under  any  law  of  any  jurisdiction  (domestic or foreign)
       relating  to  bankruptcy,  reorganization,  insolvency,  arrangement,
       composition,  receivership, liquidation, dissolution, moratorium or other
       relief  of  financially distressed debtors, or the making by any Party of
       any  assignment  for  the benefit of creditors. (12) DEFAULT. Any breach,
       default  or  event  of  default under, or any failure to comply with, any
       provision of any Agreement. (13) EVENT OF DEFAULT. Any event set forth in
       paragraph  D.  (14) EXCHANGE CONTROL PERMIT. Any permit or license issued
       by  a  Governmental  Authority  outside the United States under which any
       Party  is  permitted  (a)  to incur and pay any of the Liabilities in the
       United  States  in any currency(ies) in which denominated or (b) to enter
       into,  incur  and,  or  perform  any  other obligation or Agreement. (15)
       GOVERNMENTAL  AUTHORITY.  Any  domestic or foreign, national or local (a)
       government,  (b) governmental, quasi-governmental or regulatory agency or
       authority,  (c)  court  or  (d) central bank or other monetary authority.
       (16) INCREASED RATE. (a) If the Loan Rate is a Variable Prime-Based Rate,
       the  Increased  Rate  with  respect  to  the entire outstanding principal
       balance  shall be the Loan Rate plus 2% per year; (b) if the Loan Rate is
       not  a  Variable Prime-Based Rate, the Increased Rate with respect to any
       amount of principal or installment shall be (i) the Loan Rate plus 2% per
       year prior to the applicable Payment Date and (ii) the Prime Rate plus 4%
       per  year  on or subsequent to the applicable Payment Date. (17) LAW. Any
       treaty,  law,  regulation,  rule,  Judgment,  order,  decree,  guideline,
       interpretation or request (whether or not having the force of law) issued
       by  any  Governmental Authority. (18) LIABILITIES. (a) any and all of the
       Debt  evidenced  by this Note, and any and all other Debt of Borrower to,
       or  held or to be held by, the Bank in any jurisdiction worldwide for its
       own  account  or as agent for another or others, whether created directly
       or  acquired by Transfer or otherwise, and (b) any and all obligations of
       any  other  Party  with  respect to any of such Debt. (19) LOAN RATE. The
       interest  rate  determined  under paragraph 2. (20) MATERIAL. Material to
       the  business  or  financial  condition of any Party on a consolidated or
       consolidating basis. (21) OFFICE. The Bank's office at 1177 Avenue of the
       Americas,  New  York, New York 10036, or such other place as the Bank may
       specify  by  notice.  (22) PARTY. (a) borrower; (b) any maker co-maker or
       endorser  or  any  Agreement  evidencing  or  any  guarantor  surety,
       accommodation  party  or  indemnitor  with respect to, or any Person that
       provides  any  collateral  as  security  for, or any Person that issues a
       subordination,  comfort  letter,  standby  letter  of  credit, repurchase
       agreement, put agreement, option, other Agreement or other credit support
       with respect to any of the Liabilities; (c) if any Party is a partnership
       or  joint  venture,  any general partner or joint venturer in such Party,
       and  (d)  any  Person (i) that is under the Control of any Party and (ii)
       whose  business  or  financial  condition is Material to such Party. (23)
       PAYMENT  DATE. Any Business Day on which any part of the principal or any
       installment  of  this Note becomes due and payable under paragraph 1 (and
       not on account of an Acceleration). (24) PERSON. Any person, partnership,
       joint  venture,  company,  corporation,  uncorporated  organization  or
       association,  trust, estate, Governmental Authority, or any other entity.
       (25)  PREPAID  PRINCIPAL.  Any  amount of principal or any installment of
       this  Note  which  Borrower pays prior to the applicable Payment Date for
       such  amount.  (26)  PREPAYMENT  COSTS.  All  losses,  costs and expenses
       incurred as a result of receiving Prepaid Principal and of reinvesting it
       at  rate(s)  which  may  be  less  than  the  Applicable  Rate


                                       4

       for such Prepaid Principal. (27) PRIME RATE. The Bank's New York Branch's
       stated  Prime  Rate  as  reflected in the books and records as such Prime
       Rate  may change from time to time. The Bank's determination of its Prime
       Rate  shall  be  conclusive and final. The Prime Rate is a reference rate
       and  not  necessarily  the lowest interest rate charged by the Bank. (28)
       REGULATORY  COSTS.  Any  and all costs and expenses of complying with any
       Law,  including  but  not  limited to with respect to (a) any reserves or
       special  deposits maintained for or with, or pledges to, any Governmental
       Authority,  or (b) any capital, capital equivalency ledger account, ratio
       of  assets  to  liabilities,  risk-based  capital assessment or any other
       capital  substitute,  risk-based  or  otherwise.  (29) Taxes. Any and all
       present  and  future  taxes,  levies,  imposts,  deductions,  charges and
       withholdings  in  any  jurisdiction  worldwide,  and all liabilities with
       respect  thereto,  which  are imposed with respect to this Note or to any
       amount  payable  under this Note, excluding taxes determined on the basis
       of  the  net  income of a Person or of any of its offices. (30) TRANSFER.
       Any  negotiation,  assignment,  participation,  conveyance,  grant  of  a
       security  interest,  lease,  delegation,  or any other direct or indirect
       transfer  of  a complete or partial, legal, beneficial, economic or other
       interest or obligation. (31) TRANSFEREE. Any Person to whom a Transfer is
       made. (32) TRANSFERRED ITEMS. Items defined in paragraph I. (33) TREASURY
       OBLIGATIONS.  A  note,  bill or bond issued by the United States Treasury
       Department  as  a  full faith and credit general obligation of the United
       States.  (34)  VARIABLE  PRIME-BASED  RATE.  Any Applicable Rate which is
       determined  based  on  the  Prime  Rate.  Any  such  rate  shall  change
       automatically  when  and  as  the  Prime  Rate  changes.


                                       5

                     Multiple-Loan  Rider  to  Promissory  Note

                               (Libor-Based  Rate)

This  Rider  is  referred  to in paragraph 2(c) of, and constitutes a part of, a
note  of  Borrower  to  the  Bank  dated  March  16,  2000.

===============================================================================

SPECIFIC  TERMS

(a)  Margin:  1.00%  per  year

(b)  Interest  Period:  (__)  _________  days  [x]  1,  2 or 3 months and [x] as
                       agreed  from  time  to  time

(c)  Minimum  Draw  Amount:  U.S.  $500,000.00              [  ]  None
                                ----------------

(d)  Minimum  Multiple  Amount:  U.S.  $                     [  ]  None
                                    ------------

===============================================================================

Borrower  agrees  to  the  above  Specific  Terms  and  to  all of the Terms and
Conditioning  set  forth  below.

Print  Borrower's  Name:    Level  8  Systems,  Inc.
                        ------------------------------------------------------



(Signature) By: /s/ Steven Dmiszewicki       (Signature) By: /s/ Dennis McKinnie
               ------------------------
---------------------
Print  Name  and :  Steven Dmiszewicki,        Print Name and : Dennis McKinnie,
         title    President                    title   SVP



TERMS  AND  CONDITIONS

Certain  capitalized  terms  are  defined  in  paragraph  4.

1.     Advances.  Borrower  may  receive  a  Loan  in  any principal amount upon
       Borrower's  request to the Bank and the Bank's agreement thereto, subject
       to  all  of  the  following  conditions:

       (a)    Agreement of the Bank and Borrower. Subject to subparagraphs 1(b),
              1(c)  and 2(b), the Bank and Borrower shall have agreed, not later
              than  the  Determination  Time,  with  respect  to  the Loan's (i)
              principal  amount, (ii) LIBOR-Base Rate and (iii) Interest Period;
              provided,  however,  that  if  the  Bank  determines  that by such
              Determination  Time,  Borrower  has failed or declined to agree on
              the  LIBOR-Based  Rate and/or Interest Period with respect to such
              Outstanding  Principal  Amount,  then interest on such Outstanding
              Principal  Amount shall accrue at the LIBOR-Based Rate without the
              agreement  of  Borrower,  and  the Interest Period shall be of the
              same  duration  as



              the  Interest  Period  just ended with respect to such Outstanding
              Principal  Amount  or, if there was no such prior Interest Period,
              one  month.

       (b)    Applicable  limitations. (i) The applicable Payment Date shall not
              be  later  than  the  Due  Date; (ii) the total of the Outstanding
              Principal  Amounts  of  all  Loans  shall not exceed the principal
              amount  set  forth  in the Note; (iii) the principal amount of any
              single Loan request shall be not less than any Minimum Draw Amount
              set  forth  under Specific Terms; and (iv) the principal amount of
              any  single  Loan  request  shall  be  an integral multiple of any
              Minimum  Multiple  Amount  set  forth  under  Specific  Terms.

       (c)    Borrower's  request  and  agreement. Borrower's request for a Loan
              and  Borrower's  agreement  to  the  terms  thereof  shall  be
              communicated  to  the  Bank in any form that is acceptable in each
              instance  to  the  Bank  in its sole discretion, which may include
              telephone,  telex,  telecopy  or  a  writing executed by Borrower.
              Borrower  shall  have  provided  the  Bank  with  documentation,
              satisfactory  in  form  and  substance  to  the  Bank  in its sole
              discretion,  confirming the authority of the person(s) agreeing to
              such  terms  on  behalf  of  Borrower.

2.     Payment of Principal and Interest. Subject to the other provisions of the
       Note:

       (a)    Obligation  and  Time  of  Repayment.  Each  Outstanding Principal
              Amount  shall  be  due and payable at the applicable Payment Date.

       (b)    Loan  Rate.  Interest  on  any  Outstanding Principal Amount shall
              accrue  at  the  LIBOR-Based  Rate; provided, however, that if the
              Bank  determines  (i) that by the Determination Time (A) by reason
              of  circumstances affecting the London Interbank Market generally,
              adequate  and  fair  means  do  not  exist  for  ascertaining  an
              applicable LIBOR rate or it is impractical for the Bank to fund or
              continue  to  fund  the  Outstanding  Principal  Amount during the
              applicable  Interest  Period,  or  (B)  quotes for funds in United
              States  Dollars  in  sufficient amounts comparable to the relevant
              Outstanding  Principal  Amount  and  for  the  duration  of  the
              applicable  Interest  Period would not be available to the Bank in
              the  London  Interbank  Market,  or (C) quotes for funds in United
              States  Dollars in the London Interbank Market will not accurately
              reflect  the  cost  to the Bank of making a Loan or of funding the
              relevant  Outstanding  Principal  Amount  during  the  applicable
              Interest Period, or (ii) that at any time the making or funding of
              loans,  or  charging of interest at rates, based on LIBOR shall be
              unlawful  or  unenforceable  for  any reason, then as long as such
              circumstance(s)  shall  continue,  interest  on  the  relevant
              Outstanding  Principal  Amount shall accrue at the Alternate Rate.

       (c)    Payment and Calculation of Interest. Interest shall be payable (i)
              at  each  Payment  Date  or  (whenever  the  Applicable  Rate is a
              variable Prime-Based Rate) monthly, (ii) at the Due Date and (iii)
              at  any time that any Outstanding Principal Amount or part thereof
              is  paid.  Interest  shall be calculated as set forth in the Note.

3.     Bank's  Conclusive  Determinations and Schedule. The Bank's determination
       with  respect  to  any  matter  hereunder  shall be conclusive, final and
       binding  on  Borrower,  absent  manifest

                                       2

       error.  The  Bank  shall  from time to time record the date and amount of
       each Loan, the Applicable Rate, each date on which any part of principal,
       interest or any other amount shall be due and payable, and the amount and
       date  of  each  payment  of principal, interest or any other amount, on a
       schedule,  which  in the Bank's discretion may be computer-generated, and
       which  is incorporated in, and is a part of, the Note and this Rider (the
       "Schedule").  The  Schedule  shall  be conclusive, final and binding upon
       Borrower,  absent  manifest error; provided, however, that the failure of
       the  Bank  to  record  any  of the foregoing shall not limit or otherwise
       affect  the  obligation  of  Borrower to pay all amounts owed to the Bank
       under  the  Note.  Without  limiting the foregoing, Borrower acknowledges
       that  the  Interest  Period  and  the Applicable Rate with respect to any
       Outstanding Principal Amount are subject to the Bank's consent ordinarily
       negotiated  between  Borrower  and  the  Bank  by telephone, and Borrower
       agrees  that  in  the  event of any dispute as to any of the terms of any
       Loan, the determination of the Bank and its respective entry with respect
       thereto  on  its  books  and  records  and/or  on  the  Schedule shall be
       conclusive,  final  and  binding  on  Borrower,  absent  manifest  error.

4.     Definitions.  Each  capitalized  term  not  defined herein shall have the
       meaning  ascribed thereto in the Note. The following definitions apply in
       this  Rider  and  in  the  Note,  and  shall  prevail  over any different
       definitions  in  the  Note.

       (a)    Alternate  Rate:  an annual Variable Prime-Based Rate equal to the
              Prime  Rate  plus  the  Margin.

       (b)    Applicable  Rate:  whichever of the Loan Rate or Increased Rate is
              the  applicable  interest  rate  at  any  time with respect to any
              Outstanding  Principal  Amount.

       (c)    Determination  Time:  12:00  noon (or any later time determined by
              the Bank in its sole discretion), New York City time, of a Working
              Day  that  is  three  Working  Days prior to the date of the Loan.

       (d)    Due  Date: the date set forth in paragraph 1(b) of the Note or, if
              the  Bank has extended such date pursuant to paragraph G(5) of the
              Note  or  by  an  agreement  with  Borrower,  such  extended date.

       (e)    Interest  Period:  any  term  of  1  day,  1 week, 1 to 6, 9 or 12
              months, or such other term as may be acceptable to the Bank in its
              discretion,  as set forth above under Specific Terms or, if not so
              set forth, as selected or agreed to by the Bank in its discretion.
              A  term  shall  not  be considered as "Interest Period" during any
              period  that  the  Applicable Rate is a Variable Prime-Based Rate.
              Each  Interest Period shall commence immediately at the end of the
              preceding  Interest  Period,  if  any;  if  there  had  been  no
              immediately  preceding  Interest  Period  with  respect  to  any
              Outstanding  Principal  Amount, the Interest Period shall commence
              on  the  first  Business  Day  on  which  (i) such amount shall be
              outstanding  and  (ii)  the  Applicable  Rate  is  not  a Variable
              Prime-Based  Rate.  If any Interest Period would otherwise come to
              an  end on a day which is not a Working Day, its termination shall
              be postponed to the next day that is a Working Day unless it would
              thereby  terminate  in  the  next  calendar  month.  In  such

                                       3


              case,  such  Interest  Period  shall  terminate on the immediately
              preceding  Working  Day.

       (f)    LIBOR: the rate or rates established by the New York Branch of the
              Bank  two  Working Days prior to the date of the Loan, by applying
              the  following:  (i)  the  British  Bankers  Association  ("BBA")
              Interest  Settlement Rates for U.S. Dollars, as defined in the BBA
              official  definitions and reflected on the Telerate BBA pages, for
              the  applicable  amounts and interest periods, which rates reflect
              the  offered  rates  at  which  deposits are being quoted to prime
              banks  in  the  London  Interbank Market at 11:00 A.M. London Time
              calculated  as  set forth in said BBA official definition; or (ii)
              such other recognized source of London Eurodollar deposit rates as
              the  Bank  may  determine  from  time-to-time.  In  the  event the
              applicable BBA page or pages shall be replaced by another Telerate
              page  or  other  Telerate  pages  for  quoting London Eurocurrency
              rates,  then  rates quoted on said replacement page or pages shall
              be  applied. If the Bank determines that London Eurocurrency rates
              are  no  longer  being  quoted (temporarily or permanently) on any
              Telerate  pages  or  that  Telerate  is  no  longer  functioning
              (temporarily  or  permanently) in substantially the same manner as
              on  the  date hereof, then the Bank shall notify the Borrower of a
              substitute,  publicly available reference for the determination of
              LIBOR.  If  the  Bank determines in its sole discretion that LIBOR
              cannot  be  determined or does not represent its effective cost of
              maintaining  Loans  under this Note, then interest shall accrue at
              the  effective  cost  to  the  Bank  to  maintain  the  Loans  (as
              determined  by  the  Bank  in  its  sole  discretion).

       (g)    LIBOR-Based  Rate:  an annual rate equal to LIBOR plus the Margin,
              as  determined  by  the  Bank.

       (h)    Loan:  (i) any loan advanced by the Bank to the Borrower under the
              Note;  (ii)  any  rollover  by  the  Bank of any such loan that is
              otherwise  due  and  payable  or  (iii)  any  conversion  of  the
              Applicable  Rate  for any Outstanding Principal Amount from a rate
              that  is  a  Variable Prime-Based Rate to one that is not, or vice
              versa.

       (i)    Loan  Rate:  the  interest rate determined under subparagraph 1(a)
              and/or  2(b).

       (j)    Margin: as set forth under Specific Terms or, if not so set forth,
              2%  per  year.

       (k)    Note:  the  note  of which this Rider is a part (including any and
              all  riders  and  amendments  to  the  Note).

       (l)    Outstanding  Principal Amount: the outstanding principal amount of
              each  Loan.

       (m)    Payment  Date:  the  last  Business Day of the applicable Interest
              Period  or,  if the applicable Loan Rate is a Variable Prime-Based
              Rate,  the  Due  Date.

       (n)    Working  Day: a Business Day on which banks are regularly open for
              business  in  London.

                                       4