EXHIBIT 99.1
MEMORANDUM
TO: Mark McHugh, Deutsche Bank Alex. Brown
CC: Marnie Seif
FROM: Charles R. Stuckey Jr. /s/Charles R. Stuckey, Jr.
DATE: May 21, 2003
RE: Advanced instructions to sell RSAS Stock & Exercise and Sell RSAS
Options, Under Rule 144
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Mark:
The instructions outlined in this memo are to be used as my 10B5-1 Plan for RSA
Security, Inc.:
A. DURATION OF PLAN
This plan should commence on July 21, 2003 and end on December 31, 2003,
unless extended in writing 60 days prior to expiration.
B. RESTRICTED PERIODS OF SALE
For the first month of each quarter, no shares should be sold until 48
hours after RSAS earnings are publicly released. In addition, no sales
should occur during the last month of each quarter. (i.e. no sales should
take place during RSA Security's company blackout).
C. ACCEPTABLE PERIODS OF SALE, SHARE AMOUTS & PRICE LIMITS
In total, the directions and orders below (1-9) allow for the sale of up to
a total of 190,000 shares of RSA Security, Inc. stock for the duration of
this plan.
The following limit orders are to be placed in my DB Alex. Brown account
entitled, "Charles R. Stuckey & Marilyn Y. Stuckey TTEES Charles R. Stuckey
Revocable Trust" (Act. #5XM-002237) on the first trading day after each
blackout ends. These limit orders are to remain in my account until the
first day of the next blackout period. Any partial execution of the limit
orders below will result in the balance of that order being placed in the
next open window period. I understand that DB Alex. Brown is a market-maker
in RSAS and that the limits below are net of commission:
1. Order: Sell 20,000 RSAS @ $10.00
Shares Used (DB Act. #5XM-002237):
19,816 shares trade date: 01/02/1997, price: $20.33
184 shares trade date: 03/02/1998, price: $19.75
2. Order: Sell 30,000 RSAS @ $12.50
Shares Used (DB Act. #5XM-002237):
30,000 shares trade date: 03/02/1998, price: $19.75
3. Order: Sell 40,000 RSAS @ $15.00
Shares Used (DB Act. #5XM-002237):
40,000 shares trade date: 03/02/1998, price: $19.75
4. Order: Sell 50,000 RSAS @ $17.50
Shares Used (DB Act. #5XM-002237):
4,816 shares trade date: 03/02/1998, price: $19.75
4,700 shares trade date: 05/18/2001, price: $17.25
15,000 shares trade date: 08/31/1998, price: $6.81
25,484 shares trade date: 08/21/1998, price: $6.25
The following limit orders are to be placed in my DB Alex. Brown account
entitled, "Charles R. Stuckey & Marilyn Y. Stuckey TTEES Charles R. Stuckey
Revocable Trust" (Act. #5XM-00223) throughout ONLY the second open window,
during the six month duration of this plan:
5. Order: Sell 10,000 @ $12.00
Shares Used (DB Act. #5XM-002237):
10,000 shares trade date: 08/21/1998, price: $6.25
6. Order: Sell 10,000 @ $13.00
Shares Used (DB Act. #5XM-002237):
10,000 shares trade date: 08/21/1998, price: $6.25
7. Order: Sell 10,000 @ $14.00
Shares Used (DB Act. #5XM-002237):
10,000 shares trade date: 08/21/1998, price: $6.25
8. Order: Sell 10,000 @ $15.00
Shares Used (DB Act. #5XM-002237):
10,000 shares trade date: 08/21/1998, price: $6.25
9. Order: Sell 10,000 @ $16.00
Shares Used (DB Act. #5XM-002237):
10,000 shares trade date: 08/21/1998, price: $6.25
I have directed RSAS as soon as practicable, to notify Deutsche Bank Alex.
Brown and me of any circumstance pursuant to which a sale of shares by me
in accordance with the terms of the plans described above could be expected
either to: (a) result in a violation by me or RSAS of Regulation M
promulgated pursuant to the Securities Act of 1933, or (b) result in the
inability of RSAS to qualify for "pooling treatment" under applicable U.S.
accounting guidelines with respect to a transaction that the Company
considers imminent. Following my receipt of any such notice that I am to
suspend trading, I will instruct Deutsche Bank Alex. Brown not to sell any
shares under this plan until I am advised in writing by the Company that
the suspension has been terminated.
ADVANCED INSTRUCTION TO SELL COMMON STOCK
To: Deutsche Bank Alex. Brown
A Division of Deutsche Bank Securities Inc.
Account Number: 5XM-002237
I am a holder of shares and options to acquire shares, of the common stock
RSA Security, Inc. (Tkr: RSAS). I would like to periodically sell Company shares
in order to diversify my portfolio. I also wish to take advantage of Rule 10b5-1
under the Securities Exchange Act of 1934, as amended, which provides for an
affirmative defense from insider trading liability for purchases and sales
effected pursuant to a contract, instruction or plan entered into when a person
is not aware of any material nonpublic information. This instruction
("Instruction") is intended to constitute a "written plan for trading
securities" within the meaning of Rule 10b5-1.
I hereby instruct Deutsche Bank Securities Inc. (referred to herein as
"Deutsche Bank Alex. Brown") to sell currently held shares of Common Stock,
pursuant to the specific instructions set forth in the attached memo. My orders
here under are given to you on a not held basis, meaning that you shall use your
best judgement in the execution of each order, and that you shall be relieved of
all responsibility with respect to the time of execution or the price or prices
of execution. I understand that in exercising such judgement, it is possible
that you may not sell some or all of the shares that you are authorized
hereunder to sell in any given period under this Instruction.
You are authorized to make deliveries of securities and payment of moneys
in accordance with your normal practice. All shares to be sold shall have been
previously deposited into my account, and you shall not be required to follow
this Instruction if shares are not present in my account (or acceptable
arrangements to deliver option shares have not been made) prior to the dates on
which sales shall occur. If this Instruction requires you to exercise stock
options you shall do so in accordance with your normal procedures, and unless
instructed otherwise, remit the exercise price and the withholding tax as
calculated by the Company. In no instance should you exercise options that are
not in the money. The share amount listed above shall be increased or decreased
to reflect stock splits should they occur. I understand that I shall be
responsible to arrange for any filings that may be required under applicable law
(e.g., Form 144, Schedule 13D, and Forms 4 and 5), and that I may be subject to
the short swing profit rules contained in Section 16 of the Securities Exchange
Act of 1934. In this connection, I understand that upon my request, you will
assist me in making advance arrangements regarding the filing of Forms 144;
provided that you agree to notify me and a designated representative of RSA's
legal department within eight hours of making any trade so that I may file the
required Form 4 in a timely fashion:
o Margaret Seif: Phone: (781) 515-5403; email: mseif@rsasecurity.com
o Kathryn Leach: Phone: (781) 515-5422; email: kleach@rsasecurity.com
o Chris Dollase: Phone: (781) 515-5507; email: cdollase@rsasecurity.com
All sales shall be effected in your normal fashion in accordance with your
terms and conditions for my account and risk. You may act as principal in any
transaction hereunder. I
understand that you may not be able to make all of the sales contemplated under
this Instruction due to a market disruption or a legal, regulatory or
contractual restriction applicable to you or any other event or circumstance. I
further understand that even in the absence of such a circumstance, you may be
unable to make sales consistent with ordinary principles of best execution due
to insufficient volume of trading or other market factors in effect on the date
of a sale. I hereby ratify and confirm any and all transactions with you in
accordance with this Instruction. I also agree to indemnify and hold Deutsche
Bank Alex. Brown harmless from any and all losses arising from any cause of
action arising from its performance of this Instruction. For purposes of this
Section, the term "losses" shall mean monetary damages for which a court or
regulatory agency has found Deutsche Bank to be finally liable, after all
appeals have been exhausted, but which shall in no event exceed an amount equal
to the proceeds received by you in connection with exercises of stock options
pursuant to this Instruction. Notwithstanding the foregoing, "losses" shall not
include Deutsche Bank's attorneys fees, and Deutsche Bank may not settle any
action for which it will claim indemnification from you without your prior
written consent.
You will cease making sales under this Instruction as soon as practicable
following receipt of written notice from the Company, confirmed by telephone,
that the Company has entered into a transaction that results in my being subject
to trading restrictions. You shall resume making sales in accordance with this
Instruction as soon as practicable after you receive written notice from the
Company of the cessation or termination of any such trading restriction. Any
sales not made as a result of the imposition of any trading restriction shall be
deemed to be cancelled and shall not be made pursuant to this Instruction.
While this Instruction is in effect I will not enter into or alter any
corresponding or hedging transaction or position with respect to the Common
Stock (including any securities convertible or exchangeable into Common Stock).
I agree that until this Instruction has been terminated I will not enter into a
binding contract with respect to the purchase or sale of Common Stock with
another broker, dealer or financial institution, instruct any broker, dealer or
financial institution to purchase or sell Common Stock or adopt a trading plan
with respect to Common Stock other than this Instruction.
I represent and warrant that I am not presently aware of any material
nonpublic information regarding the Company or its securities and that I am
currently able to sell Common Stock under the Company's insider trading policies
and covenant that I will not discuss or otherwise disclose material nonpublic
information to my investment representative or any other of your personnel
responsible for carrying out this Instruction. I have obtained the approval of
the Company's counsel to enter into this Instruction.
This Instruction may be modified, terminated or amended only by a writing
signed by the parties hereto. Any modification or amendment of this Instruction
may only occur at a time when I am not aware of material nonpublic information
concerning the Company or its securities and I am otherwise permitted to make
sales under the Company's insider trading policies. If this Instruction is
modified or amended, or if I establish a new plan after termination of this
Instruction, no sales shall be made during the thirty (30) calendar days
immediately following such modification, amendment or termination (other than
sales already provided for in the Instruction prior to modification, amendment
or termination).
This Instruction shall not be effective until Deutsche Bank Alex. Brown
confirms its acceptance in writing by signing below. It shall remain in full
force and effect until revoked or modified by me in writing. Deutsche Bank Alex.
Brown may decline to act hereunder upon reasonable notice. I hereby irrevocably
authorize you to accept any instruction from the Company to cease or suspend
sales hereunder.
/s/Charles R. Stuckey, Jr.
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Charles R. Stuckey, Jr.
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Accepted
Deutsche Bank Alex. Brown
/s/Stuart C. Williams
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Stuart C. Williams, Branch Manager
Dated: 5/22/03