<PAGE> 1
Filed pursuant to Rule 424(b)(3)
Registration Number 333-49949
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED MAY 27, 1998
784,342 Shares
SECURITY DYNAMICS TECHNOLOGIES, INC.
Common Stock
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Set forth in this Prospectus Supplement is information concerning the
Selling Stockholders that supersedes and replaces the information set forth
under the caption "The Selling Stockholders" in the Prospectus dated May 27,
1998 (the "Prospectus"). Capitalized terms used and not defined herein shall
have the meanings set forth 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. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
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The date of this Prospectus Supplement is January 13, 1999
<PAGE> 2
THE SELLING STOCKHOLDERS
The Shares were originally issued in the aggregate to Robert L. Kane and
Lillian Kane on March 26, 1998 (the "Effective Date") in connection with the IDI
Acquisition. On October 8, 1998, Lillian Kane transferred an aggregate of 56,473
Shares to Dynamic Investment Co. L.P., a limited partnership of which Ms. Kane
and her husband are the general partners and members of her family are the
limited partners.
Robert L. Kane served as Chief Executive Officer and principal stockholder
of IDI until its acquisition by the Company in March 1998. Since March 1998, Mr.
Kane has served as Vice President - Technical Marketing of the Company. Lillian
Kane is Robert L. Kane's mother.
The following table sets forth certain information regarding the beneficial
ownership of shares of Common Stock as of the Effective Date and December 31,
1998, and as adjusted to reflect the assumed sale of all of the shares of Common
Stock offered hereby by each of the Selling Stockholders.
<TABLE>
<CAPTION>
Number of Number of
Number of Shares of Shares of
Shares of Common Stock Number of Common
Common Stock Beneficially Shares of Stock to be
Beneficially Owned as of Common Beneficially
Name of Owned Prior to December 31, Stock Being Owned After
Selling Stockholder Offering 1998 Offered Offering
- ---------------------------- ------------------ ------------------ --------------- -----------
<S> <C> <C> <C> <C>
Robert L. Kane 705,908 481,594(1) 705,908 375,000(2)
Lillian Kane 78,434 78,434(3) 78,434(3) 0
Dynamic Investment Co. L.P. 0 56,473 56,473 0
</TABLE>
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(1) Includes 350,000 shares which may be acquired pursuant to stock options
exercisable within 60 days after December 31, 1998, none of which shares
are offered hereby.
(2) Consists of 375,000 shares which may be acquired pursuant to stock options
exercisable within 60 days after March 26, 1999 (the scheduled completion
date of the Offering), none of which shares are offered hereby.
(3) Includes 56,473 shares held by Dynamic Investment Co. L.P., a limited
partnership of which Ms. Kane and her husband are the general partners and
members of her family are the limited partners.
-2-
<PAGE> 3
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NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS SUPPLEMENT OR THE 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 STOCKHOLDERS. THIS PROSPECTUS SUPPLEMENT AND THE
PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER
TO BUY ANY OF THE SECURITIES OFFERED HEREBY AND THEREBY TO ANY PERSON IN ANY
JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION OF AN OFFER WOULD BE UNLAWFUL.
NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS NOR ANY
OFFER OR SALE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY OR THAT
THE INFORMATION CONTAINED HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT
TO THE DATE OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS, RESPECTIVELY.
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TABLE OF CONTENTS
Page
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The Selling Stockholders..................... 2
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SECURITY DYNAMICS
TECHNOLOGIES, INC.
784,342 SHARES
COMMON STOCK
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PROSPECTUS SUPPLEMENT
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JANUARY 13, 1999
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