Filed pursuant to Rule 424(b)(3)
relating to Registration No. 333-63891
PROSPECTUS SUPPLEMENT
(To Prospectus dated October 14, 1998)
$11,425,000
COMVERSE TECHNOLOGY, INC.
4 1/2% Convertible Subordinated Debentures due 2005 initially
convertible into 177,127 Shares of Common Stock, par value $.10 per share
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This Prospectus Supplement and the accompanying Prospectus relate to an
aggregate of $8,675,000 of 4 1/2% Convertible Subordinated Debentures due 2005
(the "Debentures") of Comverse Technology, Inc. (the "Company"), and 177,127
shares of the Company's common stock, par value $.10 per share ("Common Stock"),
issuable upon conversion of the Debentures offered hereby by certain holders
named herein (collectively, the "Selling Holders"). See "Selling Holders." This
Prospectus Supplement should be read in conjunction with the Company's
Prospectus dated October 14, 1998 (the "Prospectus"), and this Prospectus
Supplement is qualified by reference to the Prospectus except to the extent that
the information contained herein supersedes the information contained in the
Prospectus.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
Dated: November 6, 1998
<PAGE>
No dealer, salesperson or any other person has been authorized in
connection with any offering made hereby to give any information or to make any
representations other than those contained or incorporated by reference in this
Prospectus Supplement or the accompanying Prospectus, and if given or made, such
information or representations must not be relied upon as having been authorized
by the Company or the Selling Holders. This Prospectus Supplement and the
accompanying Prospectus do not constitute an offer to sell or a solicitation of
an offer to buy any security other than the Shares offered hereby, nor do they
constitute an offer to sell or a solicitation of an offer to buy any of the
Shares offered hereby by anyone in any jurisdiction in which such offer or
solicitation is not authorized, or in which the person making such offer or
solicitation is not qualified to do so or to any person to whom it is unlawful
to make such offer or solicitation. Neither the delivery of this Prospectus
Supplement or the accompanying Prospectus nor any sale made hereunder shall,
under any circumstances, create any implication that there has been no change in
the affairs of the Company since the date hereof.
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PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY
The Company's Common Stock is traded on the Nasdaq National Market
under the symbol "CMVT." The following table sets forth, for the calendar
quarters indicated, the range of high and low closing prices for the Common
Stock, as reported by Nasdaq.
Low High
--- ----
1995
First Quarter.............................. $ 11.00 $ 14.63
Second Quarter............................. 13.25 18.25
Third Quarter.............................. 17.14 23.38
Fourth Quarter............................. 19.94 25.69
1996
First Quarter.............................. $ 16.63 $ 25.13
Second Quarter............................. 23.38 31.19
Third Quarter.............................. 23.75 41.38
Fourth Quarter............................. 32.56 38.13
1997
First Quarter.............................. $ 36.88 $ 46.38
Second Quarter............................. 36.50 52.00
Third Quarter.............................. 45.94 53.06
Fourth Quarter............................. 32.25 54.19
1998
First Quarter.............................. $ 30.63 $ 49.00
Second Quarter............................. 42.25 55.06
Third Quarter.............................. 36.63 56.94
Fourth Quarter (through November 5, 1998).. 29.94 50.63
On November 5, 1998, the last reported sale price of the Common Stock
on the Nasdaq National Market was $50.13. As of October 12, 1998, there were
approximately 2,688 holders of record of the Common Stock.
The Company has never declared or paid dividends on its capital stock
and does not anticipate paying any dividends in the foreseeable future. The
Company currently intends to retain its earnings, if any, to finance the
development and growth of its business. Any future determination as to the
declaration and payment of dividends will be made by the Company's Board of
Directors in its discretion, and will depend upon the Company's earnings,
financial condition, capital requirements and other relevant factors.
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<PAGE>
SELLING HOLDERS
The Debentures were originally issued by the Company and sold by Lehman
Brothers Inc. (the "Initial Purchaser"), in transactions exempt from the
registration requirements of the Securities Act of 1933, as amended (the
"Securities Act"), to persons reasonably believed by the Initial Purchaser to be
"qualified institutional buyers" (as defined in Rule 144A under the Securities
Act). The Selling Holders (which term includes their transferees, pledgees,
donees or their successors) may from time to time offer and sell pursuant to
this Prospectus any or all of the Debentures and Common Stock issued upon
conversion of the Debentures.
The following table sets forth information with respect to the Selling
Holders and the respective principal amounts of Debentures and shares of Common
Stock beneficially owned by each Selling Holder. Such information has been
obtained from the Selling Holders. Except as otherwise disclosed herein, none of
the Selling Holders has, or within the past three years has had, any position,
office or other material relationship with the Company or any of its
predecessors or affiliates. Because the Selling Holders may offer all or some
portion of the Debentures or the Common Stock issuable upon conversion thereof
pursuant to this Prospectus Supplement and the accompanying Prospectus, no
estimate can be given as to the amount of the Debentures or the Common Stock
issuable upon conversion thereof that will be held by the Selling Holders upon
termination of any such sales. In addition, the Selling Holders identified below
may have sold, transferred or otherwise disposed of all or a portion of their
Debentures since the date on which they provided the information regarding their
Debentures in transactions exempt from the registration requirements of the
Securities Act. Finally, additional Selling Holders may from time to time be
identified and information with respect to such Selling Holders be provided in a
Prospectus Supplement.
<TABLE>
<CAPTION>
Principal Amount of Number of
Debentures Percentage of Shares of
Beneficially Owned Debentures Common Stock
Selling Holder and Offered Hereby Outstanding Beneficially Owned(1)(2)
- -------------- ------------------ ----------- ------------------------
<S> <C> <C> <C>
BT Alex. Brown Inc.................... $ 4,500,000 1.5% 69,767
Chrysler Corporation Master Retirement
Trust.............................. 280,000(3) * 4,341
CIBC Oppenheimer Corp................. 275,000 * 4,263
Credit Suisse First Boston Corporation 2,400,000 * 61,891
D.E. Shaw Securities, L.P............. 2,750,000 * 44,235
Delta Air Lines Master Trust (c/o Oaktree
Capital Management, LLC)........... 135,000 * 2,093
OCM Convertible Limited Partnership... 10,000(3) * 155
OCM Convertible Trust................. 300,000(3) * 4,651
Partner Reinsurance Company Ltd....... 100,000 * 1,550
Raytheon Company Master Pension Trust. 155,000(3) * 2,403
Raytheon Company Master Pension Trust. 160,000 * 2,480
State Employees' Retirement Fund of the
State of Delaware.................. 105,000 * 1,627
Vanguard Convertible Securities Fund,
Inc................................ 255,000(3) * 3,953
</TABLE>
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* Less than 1%.
(1) Assumes conversion of the full amount of Debentures held by such holder at
the initial conversion rate of 15.5039 shares per $1,000 principal amount
of Debentures; such conversion rate is subject to adjustment as described
under "Description of Debentures--Conversion Rights" in the Prospectus.
Accordingly, the number of shares of Common Stock issuable upon conversion
of the Debentures may increase or decrease from time to time. Under the
terms of the Indenture, cash will be paid in lieu of issuing fractional
shares, if any, upon conversion of the Debentures.
(2) The number of shares of Common Stock held by each holder named herein is
less than 1% of the Company's outstanding Common Stock as of September 30,
1998.
(3) Represents principal amount of Debentures acquired from Lehman Brothers
Inc. pursuant to Rule 144A under the Securities Act, which principal amount
has been previously listed in the Prospectus.
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