BORROWER SECURITY AGREEMENT
BORROWER SECURITY AGREEMENT dated as of December 15, 2000, made by LEVEL 8 SYSTEMS,
INC. (the "Borrower"), in favor of BANK HAPOALIM B.M., (the "Bank"), as holder of the Secured
Obligations and as party to the Loan Agreement described below.
WHEREAS, the Borrower, is a party to the Loan Agreement, dated as of December 15, 2000 (as amended,
supplemented or otherwise modified from time to time, the "Loan Agreement"), between the Borrower and the
WHEREAS, pursuant to the Loan Agreement, the Bank has agreed to make certain Extensions of Credit to the
Borrower upon the terms and subject to the conditions set forth therein; and
WHEREAS, it is a condition precedent to the obligation of the Bank to make Extensions of Credit to the
Borrower under the Loan Agreement that the Borrower shall have executed and delivered this Borrower Security
Agreement to the Bank.
NOW, THEREFORE, in consideration of the premises and to induce the Bank to make Extensions of Credit
under the Loan Agreement, the Borrower hereby agrees with the Bank as follows:
1. Defined Terms.
(a) Unless otherwise defined herein, terms defined in the Loan Agreement and used herein shall have the
meanings given to them in the Loan Agreement, and the following terms which are defined in the Uniform
Commercial Code in effect in the State of New York on the date hereof are used herein as so defined: Accounts,
Chattel Paper, Documents, Equipment, Farm Products, General Intangibles, Instruments, Inventory and
(b) The following terms shall have the following meanings:
"Agreement": this Security Agreement, as the same may be amended, supplemented or otherwise modified from
time to time.
"Code": the Uniform Commercial Code as from time to time in effect in
the State of New York.
"Collateral": as defined in Section 2.
"Investment Property": the collective reference to all "investment property" as such term is defined in Sect