Current Report Filing (8-k)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_____________________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):

April 15, 2015

COMVERSE, INC.

(Exact name of registrant as specified in its charter)



Delaware	001-35572	04-3398741

(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

200 Quannapowitt Parkway

Wakefield, MA

01880

(Address of Principal Executive Offices)

(Zip Code)

Registrant's telephone number, including area code: (781) 246-9000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement.

On April 14, 2015, Comverse, Inc. (the “Company”) entered into a Master Service Agreement (the “MSA”) with Tech Mahindra Limited (“Tech Mahindra”) pursuant to which Tech Mahindra will perform certain services for the Company’s Digital Services business on a global basis. The services include research and development, project deployment and delivery and maintenance and support for customers of the Company’s Digital Service business. In connection with the transaction, up to 570 employees of the Company and its subsidiaries may be rehired by Tech Mahindra or its affiliates. However, under the terms of the MSA, where applicable, Tech Mahindra’s provision of such services (and any employee rehire) is contingent upon local decisions for Company entities to enter into the agreement on a country-by-country basis after the completion of all regulatory and compliance requirements under applicable law.

Under the MSA, the Company is obligated to pay to Tech Mahindra in the aggregate approximately $211 million in base fees for services to be provided pursuant to the MSA for a term of six years, renewable at the Company’s option. The services under the MSA will start on June 1, 2015. The Company expects to realize gross savings in excess of $70 million over the term of the MSA.

The Company has the right to terminate the MSA for convenience subject to the payment of certain termination fees. The Company may terminate the MSA upon certain material breaches, certain material performance failures or violations of applicable law by Tech Mahindra without termination fees. Tech Mahindra may terminate the MSA upon certain material breaches by the Company, including the failure to pay undisputed amounts. Upon any termination or expiration, Tech Mahindra will provide reverse transition services to transition the services being provided by Tech Mahindra pursuant to the MSA back to the Company or its designee.

The foregoing description of the MSA does not purport to be complete and is qualified in its entirety by reference to the MSA, a copy of which the Company intends to file with its Quarterly Report on Form 10-Q for the quarterly period ending April 30, 2015. Portions of the MSA may be omitted in accordance with a request for confidential treatment that the Company expects to submit to the Securities and Exchange Commission.

Item 2.05 Costs Associated with Exit or Disposal Activities.

In connection with the MSA, on April 14, 2015, the Company approved the commencement of a restructuring plan expected to include a reduction of workforce included in cost of revenue, research and development and selling, general and administrative expenses. The plan is expected to be substantially completed by January 31, 2016. The aggregate cost of the plan is currently estimated to range from $10 million to $12 million in severance-related costs, which is expected to be accrued and paid by January 31, 2017.

Item 7.01 Regulation FD Disclosure.

On April 15, 2015, the Company and Tech Mahindra issued a joint press release in connection with the entry into the MSA. A copy of the press release is attached as Exhibit 99.1 hereto and is incorporated by reference in its entirety herein.

The information contained in Item 7.01 of this Current Report, including the press release attached as an exhibit hereto, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section and shall not be incorporated by reference into any registration statement or other document filed pursuant to the Securities Act of 1933, as amended, or the Exchange Act except as shall be expressly set forth by a specific reference in such filing.


Item 9.01.	Financial Statements and Exhibits


Exhibit No.	Description


99.1	Joint Press Release of Comverse, Inc. and Tech Mahindra, dated April 15, 2015.

Forward-Looking Statements

This Current Report includes “forward-looking statements.” Forward-looking statements include statements regarding the parties’ performance under the MSA, rehiring of Company employees, payment amounts, expected costs and savings, plans and objectives, and assumptions relating thereto. In some cases, forward-looking statements can be identified by the use of terminology such as “may,” “expects,” “plans,” “anticipates,” “estimates,” “believes,” “potential,” “projects,” “forecasts,” “intends,” or the negative thereof or other comparable terminology. By their very nature, forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause actual results, performance and the timing of events to differ materially from those anticipated, expressed or implied by the forward-looking statements in this Current Report. Such risks or uncertainties may give rise to future claims and increase exposure to contingent liabilities. These risks and uncertainties relate to (among other factors) the effect of restructuring initiatives on the Company’s business; exposure to additional risks as a result of outsourcing, such as loss of control over outsourced operations and increased exposure to security breaches; risks associated with foreign operations; satisfaction and performance by the parties of the terms and conditions of the MSA; changed conditions affecting current estimates, including with respect to costs and savings; dependence by the Company on Tech Mahindra; economic, industrial and competitive conditions; compliance with applicable laws and regulations; lack of market acceptance of Digital Services offerings; and additional risks described in the sections entitled “Forward-Looking Statements” and Item 1A, “Risk Factors” and elsewhere in the Company's most recent Annual Report on Form 10-K, or in subsequently filed periodic, current or other reports with the U.S. Securities and Exchange Commission. The Company undertakes no commitment to update or revise any forward-looking statements except as required by law.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.



	COMVERSE, INC.

	By:	/s/ Roy S. Luria
		Roy S. Luria
		Senior Vice President, General Counsel and Corporate Secretary
Date: April 15, 2015

EXHIBIT INDEX




Exhibit No.	Description
99.1	Joint Press Release of Comverse, Inc. and Tech Mahindra, dated April 15, 2015.

Exhibit 99.1

Contact:



Michael Grossi Comverse, Inc. michael.grossi@comverse.com +1-781-224-8030	Aashish Washikar Tech Mahindra Ltd. Aashish.washikar@techmahindra.com +91 40 30675493

Comverse and Tech Mahindra Sign Global Strategic Relationship

WAKEFIELD, Mass. and TEL AVIV, Israel, April 15, 2015 - Comverse (NASDAQ: CNSI) and Tech Mahindra announced today they have reached an agreement in principle on a strategic relationship, whereby Comverse will accelerate its transformation as a global innovator in digital services by leveraging Tech Mahindra’s expertise and scale in development and delivery of digital offerings. As part of this initiative, employees from certain functions within Comverse’s Digital Services business unit are anticipated to join Tech Mahindra. Tech Mahindra is a specialist in digital transformation, consulting and business re-engineering, particularly in the global technology industry.

Tech Mahindra will complement Comverse’s R&D and engineering operations through innovation in product development techniques and just-in-time capability reinforcement. Tech Mahindra will bring its experience in developing and creating a start-up ecosystem that has helped launch path-breaking solutions for the connected world. The company will also enable global exposure and long-term career opportunities for the employees coming onboard from Comverse.

This relationship gives Comverse access to a flexible operating model to respond more quickly to changes in market demands and brings an influx of skills to expand Comverse’s delivery of innovative products for its customers.

“With this initiative, Comverse will significantly improve its ability to focus on its prime areas of growth and innovation,” said Philippe Tartavull, President and Chief Executive Officer, Comverse. “Our objective is to build a strong foundation through a transformed and more competitive Comverse, for our customers, our employees and shareholders going forward. We are excited to work with Tech Mahindra and take the relationship to the next level.”

“The onboarding of Comverse’s expertise will help Tech Mahindra significantly, as we are one of the comprehensive integrators of technology services to communications service providers. This move will help us augment our investments in startup ecosystems, research and development, and network services. I take this opportunity to welcome members of the Comverse workforce into the $16.5 billion Mahindra Group,” said CP Gurnani, MD & CEO, Tech Mahindra.

The majority of the employees who will come onboard with Tech Mahindra as part of this initiative are based in Israel, the United States and several countries in APAC and EMEA. Comverse is in the process of engaging with employee representatives on its plans in accordance with country-specific legal obligations. The program is expected to be implemented starting June 1, 2015.

About Tech Mahindra

Tech Mahindra is a specialist in digital transformation, consulting and business re-engineering solutions. We are a USD 3.5 billion company with 98,000+ professionals across 51 countries. We provide services to 674 global customers including Fortune 500 companies. Our innovative platforms and reusable assets connect across a number of technologies to deliver tangible business value to all our stakeholders. Tech Mahindra is also amongst the Fab 50 companies in Asia as per the Forbes 2014 List.

We are part of the USD 16.5 billion Mahindra Group that employs more than 200,000 people in over 100 countries. Mahindra operates in the key industries that drive economic growth, enjoying a leadership position in tractors, utility vehicles, information technology, financial services and vacation ownership.

Connect with us on www.techmahindra.com

About Comverse

Comverse provides true carrier-grade cloud-based and in-network monetization and revenue management software solutions that help global carriers and growing enterprises profitably enable the way people obtain and share digital experiences, today and tomorrow. We support digital lifestyles through a suite of proven and flexible solutions that includes managed BSS and Policy, Enterprise and Cloud Billing, and Digital Services, all guided by an experienced Managed Services offering, that ensure our customers gain competitive advantage. Comverse’s customer base spans more than 125 countries with solutions successfully delivered to over 450 communication service providers and enterprises serving more than two billion subscribers. For more information, visit www.comverse.com.

Forward-Looking Statements

This press release includes “forward-looking statements,” including statements regarding Comverse’s transformation as a global innovator in digital services, Comverse employees joining Tech Mahindra, anticipated benefits of Comverse’s relationship with Tech Mahindra, objectives, growth, innovation, opportunities, compliance with legal obligations, and anticipated timing. In some cases, forward-looking statements can be identified by the use of terminology such as “may,” “expects,” “plans,” “anticipates,” “estimates,” “believes,” “potential,” “projects,” “forecasts,” “intends,” or the negative thereof or other comparable terminology. By their very nature, forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause actual results, performance and the timing of events to differ materially from those anticipated, expressed or implied by the forward-looking statements in this press release. Such risks or uncertainties may give rise to future claims and increase exposure to contingent liabilities. These risks and uncertainties relate to (among other factors) the effect of restructuring initiatives on Comverse’s business; exposure to additional risks as a result of outsourcing, such as loss of control over outsourced operations and increased exposure to security breaches; risks associated with foreign operations; satisfaction and performance of the terms and conditions of the parties’ agreement; changed conditions affecting current estimates; inability of the parties’ relationship to achieve anticipated results; disadvantages to Comverse employees, including reductions in workforce; dependence by Comverse on Tech Mahindra; delays or impediments to implementation of the parties’ arrangement; economic, industrial and competitive conditions; compliance with applicable laws and regulations; lack of market acceptance of Digital Services offerings; and additional risks described in the sections entitled “Forward-Looking Statements” and Item 1A, “Risk Factors” and elsewhere in Comverse's most recent Annual Report on Form 10-K, or in subsequently filed periodic, current or other reports filed with the U.S. Securities and Exchange Commission. Comverse undertakes no commitment to update or revise any forward-looking statements except as required by law.

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