Exhibit 4.1
FIRST AMENDMENT TO
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REGISTRATION RIGHTS AGREEMENT
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This FIRST AMENDMENT TO REGISTRATION RIGHTS AGREEMENT (this "Amendment")
dated as of August 8, 2001, is entered into by and between Level 8 Systems,
Inc., a Delaware corporation (the "Company"), and Liraz Systems, Ltd., a company
organized under the laws of Israel (the "Shareholder").
W I T N E S S E T H:
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WHEREAS, the Company and Shareholder are parties to that certain
Registration Rights Agreement dated as of June 15, 1995, entered into by and
between Across Data Systems, Inc., the predecessor of the Company, and the
Shareholder (the "Registration Rights Agreement"). Capitalized terms used and
not otherwise defined herein shall have the meanings ascribed to them in the
Registration Rights Agreement; and
WHEREAS, the parties desire to amend the Registration Rights Agreement to
provide for the registration (as that term is defined in the Registration Rights
Agreement) of all Registrable Securities held by the Shareholder; and
WHEREAS, the parties desire to enter into this Amendment in order to
evidence the foregoing and for other purposes.
NOW, THEREFORE, for and in consideration of the premises set forth herein
and other good and valuable consideration, the receipt, adequacy, and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. Registration. As promptly as practicable following the execution
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and delivery of that certain Asset Purchase Agreement (the "Asset Purchase
Agreement") by and between the Company and the Shareholder (and/or an affiliate
thereof), but not later than the closing of the transactions contemplated
therein, the Company shall cause a registration statement under the 1933 Act
covering any sale or other disposition of all the Registrable Securities owned
by Shareholder or any of Shareholder's subsidiaries to be filed with the SEC
(other than any Registrable Securities the sale of which already is covered by a
registration statement under the 1933 Act (an "Existing Registration
Statement")) (the "New Registration Statement"). The Company shall use its best
efforts (a) to cause the New Registration Statement to be declared effective by
the SEC as soon as practicable after it is filed, (b) to cause each Existing
Registration Statement to continue to, and, after the New Registration Statement
is declared effective by the SEC, to cause the New Registration Statement to
continue to, comply with all the requirements of the 1933 Act and the rules and
regulations under the 1933 Act by amending or supplementing each Existing
Registration Statement and the New Registration Statement from time to time to
enable the selling securityholders to sell or otherwise dispose of all such
securities at all times, until the earlier of (i) when all such securities
covered by the respective registration statements are sold or otherwise disposed
of, or (ii) when two years have passed from the date such respective
registration statements were declared effective by the SEC, and (c) upon written
notice given by Shareholder to the Company on not more than two occasions, cause
resales of any such securities by one or more persons or entities to whom
Shareholder (or any of its subsidiaries) sells or otherwise disposes of any such
securities to be covered by a registration statement under the 1933 Act, in
which case the other provisions of this section 1 shall apply to any such
registration statement as if such registration statement were the New
Registration Statement, mutatis mutandis. The Company shall bear all the
expenses of performing its obligations under this section 1.
2. Current Information. As long as Shareholder beneficially owns more
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than 15% of the outstanding shares of the Company's common stock, the Company
shall, at its own expense, furnish Shareholder (a) not later than 25 days after
the end of each calendar quarter and not later than 60 days after the end of
each calendar year, drafts of the Company's consolidated financial statements as
of and for the quarter and year to date then ended, and as of and for the year
then ended, as the case may be, prepared in accordance with United States
generally accepted accounting principles consistently applied, and (b) not later
than 35 days after the end of each calendar quarter and not later than 75 days
after the end of each calendar year, the Company's final consolidated financial
statements as of and for the quarter and year to date then ended, and as of and
for the year then ended, as the case may be, prepared in accordance with United
States generally accepted accounting principles consistently applied, and the
Company shall afford the Shareholder and its representatives access to its books
and records sufficient to enable them, beginning promptly after the draft
financial statements referred to above are prepared, to reconcile these
financial statements with financial statements prepared in accordance with
Israeli generally accepted accounting principles consistently.
3. Remedies. In addition to being entitled to exercise all rights
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granted by law, including recovery for damages, Shareholder will be entitled to
specific performance of its rights under this Amendment, including all rights
and remedies of the Shareholder under the Asset Purchase Agreement.
4. No Other Amendment or Waiver. Except for the amendments set forth
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above, the terms of the Registration Rights Agreement shall remain unchanged and
in full force and effect. Each party acknowledges and expressly agrees that the
other party requires strict compliance with all the terms and provisions of the
Registration Rights Agreement.
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IN WITNESS WHEREOF, the parties, each by its duly authorized signatory,
have executed this Amendment as of the date first above written.
COMPANY:
LEVEL 8 SYSTEMS, INC.
(Formerly Across Data Systems, Inc.)
/s/ ▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇▇,
President
SHAREHOLDER:
IRAZ SYSTEMS, LTD.
By:/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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