Related Party Transactions

9 Months Ended

Oct. 31, 2011

Related Party Transactions [Abstract]

Related Party Transactions

19. RELATED PARTY TRANSACTIONS

Verint Series A Convertible Perpetual Preferred Stock

On May 25, 2007, in connection with Verint's acquisition of Witness, CTI entered into a Securities Purchase Agreement with Verint (the "Securities Purchase Agreement"), whereby CTI purchased, for cash, an aggregate of 293,000 shares of Verint's Series A Convertible Perpetual Preferred Stock (the "preferred stock"), which represents all of Verint's outstanding preferred stock, for an aggregate purchase price of $293.0 million. Proceeds from the issuance of the preferred stock were used to partially finance the acquisition. The preferred stock is eliminated in consolidation. Through October 31, 2011 and January 31, 2011, cumulative, undeclared dividends on the preferred stock were $55.6 million and $45.7 million, respectively. As of October 31, 2011 and January 31, 2011, the liquidation preference of the preferred stock was $348.6 million and $338.7 million, respectively.

Each share of preferred stock is entitled to a number of votes equal to the number of shares of common stock into which such share of preferred stock is convertible using the conversion rate that was in effect upon the issuance of the preferred stock in May 2007, on all matters voted upon by Verint Systems' common stockholders. The conversion rate was set at 30.6185 shares of common stock for each share of preferred stock. As of October 31, 2011 and January 31, 2011, the preferred stock could be converted into approximately 10.7 million and 10.4 million shares of Verint Systems' common stock, respectively.