If the filing
person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following
box. ☐
The information required on the remainder of this cover page
shall not be deemed to be “filed” for the purpose of section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions
of the Act (however, see the Notes).
SCHEDULE 13D
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CUSIP No. 81374A105
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Page 2 of 8
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Names of
reporting persons
Michael R. Cote
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2
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Check the appropriate box if a member
of a group (see instructions)
(a) ☐ (b) ☐
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3
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SEC use only
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4
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Source of funds (see instructions)
OO
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5
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Check if disclosure of legal
proceedings is required pursuant to Items 2(d) or 2(e) ☐
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6
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Citizenship or place of
organization
United States of America
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Number of
shares
beneficially
owned by
each
reporting
person
with:
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7
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Sole voting power
799,983 shares of Class A Common Stock
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8
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Shared voting power
-0-
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9
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Sole dispositive power
237,427 shares of Class A Common Stock
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10
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Shared dispositive power
-0-
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11
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Aggregate amount beneficially owned by each reporting person
799,983 shares of Class A Common Stock
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12
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Check if the aggregate amount in Row
(11) excludes certain shares (see instructions) ☐
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13
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Percent of class represented by amount
in Row (11)
7.3%
1
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14
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Type of reporting person (see
instructions)
IN
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1
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Based on 10,850,137 shares of Class A Common Stock outstanding as of April 24, 2017, as reported by the Issuer in its Definitive Proxy
Statement on Schedule 14A for the Issuer’s 2017 Annual Meeting of Stockholders filed with the Securities and Exchange Commission on May 12, 2017.
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Item 1.
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Security and Issuer.
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This statement on Schedule 13D (the “Schedule 13D”)
relates to the shares of Class A Common Stock, par value $0.01 per share (the “Class A Common Stock”), of SecureWorks Corp., a Delaware corporation (the “Issuer”). The Issuer’s principal executive offices are
located at One Concourse Parkway NE Suite 500, Atlanta, Georgia 30328.
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Item 2.
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Identity and Background.
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This Schedule 13D is being filed by Michael R. Cote (the
“Reporting Person”), who is the President and Chief Executive Officer and a member of the Board of Directors of the Issuer. The Reporting Person’s principal business address is c/o SecureWorks Corp., One Concourse Parkway NE
Suite 500, Atlanta, Georgia 30328.
During the past five years, the Reporting Person has not been (a) convicted in any criminal
proceeding (excluding traffic violations or similar misdemeanors) or (b) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
The Reporting Person is a citizen of the United States.
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Item 3.
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Source and Amount of Funds or Other Consideration.
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None of the shares of Class A
Common Stock beneficially owned by the Reporting Person were acquired by purchase. All of such shares were received by the Reporting Person pursuant to compensatory equity incentive awards approved by the Issuer’s Board of Directors (the
“Board”) and granted under the SecureWorks Corp. 2016 Long-Term Incentive Plan (the “2016 Plan”).
The information set
forth in Item 4 is incorporated by reference herein.
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Item 4.
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Purpose of the Transaction.
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The Reporting Person became the beneficial owner of more
than 5% of the outstanding Class A Common Stock upon his receipt on March 7, 2017 of a compensatory equity incentive award under the 2016 Plan approved by the Board and consisting of 116,388 time-based restricted shares of Class A
Common Stock and 116,388 performance-based restricted shares of Class A Common Stock, as described below. As of May 17, 2017, the shares of Class A Common Stock beneficially owned by the Reporting Person consisted of the following
compensatory equity incentive awards outstanding under the 2016 Plan:
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•
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562,556 restricted shares of Class A Common Stock subject to vesting in accordance with the terms of such awards, which include:
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•
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329,780 restricted shares of Class A Common Stock representing 80% of a grant of time-based restricted shares approved by the Board on April 22, 2016 in connection with the Issuer’s initial public
offering, and awarded pursuant to the Issuer’s Restricted Stock Agreement for executives under the 2016 Plan;
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•
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116,388 restricted shares of Class A Common Stock representing 100% of a grant of time-based restricted shares approved by the Board on March 7, 2017, and awarded pursuant to the Issuer’s Restricted Stock
Agreement for executives under the 2016 Plan; and
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•
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116,388 restricted shares of Class A Common Stock representing 100% of a grant of performance-based restricted shares approved by the Board on March 7, 2017, and awarded pursuant to the Issuer’s
Performance-Based Restricted Stock Agreement for executives under the 2016 Plan;
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•
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177,836 shares of Class A Common Stock which the Reporting Person may acquire upon the exercise of vested
stock options as of or within 60 days of May 17, 2017 representing 20% of a grant of options to
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Page 3 of 8
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purchase 889,183 shares of Class A Common Stock approved by the Board on April 21, 2016 in connection with the Issuer’s initial public offering, and awarded pursuant to the
Issuer’s Nonqualified Stock Option Agreement for executives under the 2016 Plan; and
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•
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59,591 unrestricted shares of Class A Common Stock representing 20% of the grant of time-based restricted shares approved by the Board on April 22, 2016, as described above, that vested on April 22, 2017,
less 22,854 shares delivered by the Reporting Person to the Issuer on April 25, 2017 in satisfaction of tax withholding obligations related to such vesting, in accordance with the 2016 Plan.
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From time to time, the Reporting Person may acquire beneficial ownership of additional shares of Class A Common Stock, by purchase or
otherwise, including (a) pursuant to the vesting or exercise of outstanding stock options currently owned by the Reporting Person or (b) upon receipt from the Issuer of future compensatory equity incentive awards for which the Reporting
Person qualifies, including, but not limited to, awards of restricted shares of Class A Common Stock, options to purchase shares of Class A Common Stock, and restricted stock units for Class A Common Stock. In addition, from time to
time, the Reporting Person may determine to dispose of all or a portion of the shares of Class A Common Stock which are beneficially owned by the Reporting Person and over which the Reporting Person has investment power.
Except as noted above, the Reporting Person has no current plans or proposals which relate to, or would result in, any of the matters set
forth in sub-items (a) through (j) of Item 4 of Schedule 13D. In the Reporting Person’s roles as President and Chief Executive Officer and a member of the Board of Directors of the Issuer, the Reporting Person has the
ability directly or indirectly to influence the management and policies of the Issuer.
The information set forth in Items 5 and 6 is
incorporated by reference herein.
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Item 5.
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Interest in Securities of the Issuer.
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(a)
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As of May 17, 2017, the Reporting Person beneficially owned 799,983 shares of the Class A Common Stock, consisting of 562,556 restricted shares of Class A Common Stock which are subject to vesting, 177,836
shares of Class A Common Stock which the Reporting Person may acquire upon the exercise of vested stock options as of or within 60 days of May 17, 2017 and 59,591 unrestricted shares of Class A Common Stock. As of such date, the 799,983
shares of Class A Common Stock beneficially owned by the Reporting Person represented approximately 7.3% of the shares of Class A Common
Stock.
2
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(b)
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As of May 17, 2017, the Reporting Person has:
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(i)
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sole power to vote or direct the vote of 799,983 shares of Class A Common Stock;
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(ii)
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shared power to vote or direct the vote of -0- shares of Class A Common Stock;
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(iii)
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sole power to dispose or direct the disposition of 237,427 shares of Class A Common Stock
3
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; and
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(iv)
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shared power to dispose or direct the disposition of -0- shares of Class A Common Stock.
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Under the terms of the Issuer’s Amended and Restated Certificate of Incorporation, a holder of a share of Class A Common Stock is
entitled to one vote per share and a holder of a share of the Issuer’s Class B Common Stock, par value $0.01 per share (the “Class B Common Stock”), is entitled to ten votes per share. As of May 17, 2017, 70,000,000 shares
of the Class B Common Stock were issued and outstanding, all of which were beneficially
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2
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Based on 10,850,137 shares of Class A Common Stock outstanding as of April 24, 2017, as reported by the Issuer in its Definitive Proxy Statement on Schedule 14A for the Issuer’s 2017 Annual Meeting of Stockholders
filed with the Securities and Exchange Commission on May 12, 2017.
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3
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As of May 17, 2017, the Reporting Person has the right to vote, but not the right to dispose or direct the disposition of, the restricted shares of Class A Common Stock beneficially owned by the Reporting Person. Of the
799,983 shares of Class A Common Stock beneficially owned by the Reporting Person as of such date, 562,556 are restricted shares of Class A Common Stock over which the Reporting Person will not have investment power until the vesting
thereof, as reported in Item 6.
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Page 4 of 8
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owned by Dell Technologies Inc. through an indirect wholly-owned subsidiary. As of such date, the Reporting Person has voting power over shares of Class A Common Stock representing
approximately 0.11% of the combined voting power of both classes of common stock of the Issuer.
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(c)
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Except as described in Item 4 with respect to the 22,854 shares of Class A Common Stock delivered by the Reporting Person to the Issuer on April 25, 2017 in satisfaction of tax withholding obligations
related to the vesting of awards of restricted shares under the 2016 Plan, there have been no transactions in shares of Class A Common Stock by the Reporting Person during the past 60 days. The delivery of such 22,854 shares of
Class A Common Stock to the Issuer was executed at a price of $9.00 per share of Class A Common Stock.
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(d)
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Except as set forth herein, to the knowledge of the Reporting Person, no other person has the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, any shares of
Class A Common Stock reported herein as beneficially owned.
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The information set forth in Items 4 and 6 is incorporated by reference
herein.
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Item 6.
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Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.
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Set forth below are the contracts, arrangements, understandings or relationships (legal or otherwise) between the Reporting Person and any
other persons with respect to any securities of the Issuer.
SecureWorks Corp. 2016 Long-Term Incentive Plan
All of the shares of Class A Common Stock beneficially owned by the Reporting Person were acquired by the Reporting Person pursuant to
grants of compensatory equity incentive awards under the 2016 Plan. The Issuer’s Board and sole stockholder approved and adopted the 2016 Plan before the closing of the Issuer’s initial public offering in April 2016. As described in
Item 4, the Board has granted to the Reporting Person awards under the 2016 Plan consisting of the items below.
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•
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Grants of (a) time-based restricted shares of Class A Common Stock and (b) options to purchase Class A Common Stock at an exercise price per share equal to the Issuer’s initial public offering
price of $14.00 per share, made on April 21 and 22, 2016, respectively, in connection with the Issuer’s initial public offering. Each of these awards vests ratably over a five-year period contingent upon the Reporting Person continuing in
service with the Issuer or its affiliates on each vesting date. The first stock option vesting event occurred on April 21, 2017 and the first restricted stock vesting event occurred on April 22, 2017.
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Grants of (a) time-based restricted shares of Class A Common Stock and (b) performance-based restricted shares of Class A Common Stock, made on March 7, 2017 in accordance with the Issuer’s
compensation policy with respect to its executive officers. Each of the time-based awards vests ratably over a three-year period contingent upon the Reporting Person continuing in service with the Issuer or its affiliates on each vesting date, with
the first vesting date to occur on March 7, 2018. Each of the performance-based awards will be earned upon the achievement of performance goals specified in the applicable award agreement at the time of grant and thereafter will vest over a
three-year period contingent upon the Reporting Person continuing in service with the Issuer or its affiliates on each vesting date, with the first vesting date to occur on a Board certification date which will be no later than 75 days following
February 2, 2018, and with subsequent vesting events to occur on March 7, 2019 and March 7, 2020.
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Award Agreements Under
SecureWorks Corp. 2016
Long-Term
Incentive Plan
The awards to the Reporting Person of
(a) time-based restricted shares of Class A Common Stock were made pursuant to the Issuer’s Restricted Stock Agreement for executives under the 2016 Plan, (b) performance-based restricted shares of Class A Common Stock were
made pursuant to the Issuer’s Performance-Based Restricted Stock Agreement for Executives under the 2016 Plan and (c) options to purchase shares of Class A Common Stock were made pursuant to the Issuer’s Nonqualified Stock Option
Agreement for executives under the 2016 Plan.
Under the 2016 Plan, the Board has authority to issue awards with award agreement
provisions that accelerate vesting and exercisability upon a change in control of the Issuer and other events, and to amend existing awards to provide for such acceleration. In accordance with this authority, the vesting of the Reporting
Person’s equity awards will be accelerated pursuant to the terms of the Reporting Person’s applicable award agreement upon an “involuntary termination” of employment (as defined below) within 12 months following a change in
control of the Issuer, as defined for purposes of the 2016 Plan.
Page 5 of 8
Under the 2016 Plan, “change in control” is generally defined as any of the following
events: (a) a transaction in which any person, entity or group (other than specified persons and entities, including, but not limited to, Dell Technologies Inc. and Michael S. Dell) becomes the beneficial owner of more than 50% of the total
voting power of the Issuer’s common stock; (b) the members of the Board as of April 28, 2016 (together with any new directors nominated by at least a majority of such members or other members nominated in accordance with this
provision) cease to constitute a majority of the members of the Board; (c) the Issuer undertakes a merger or consolidation in which the holders of the Issuer’s capital stock immediately before the merger or consolidation do not own in the
aggregate at least a majority of the voting power of the voting capital stock of the surviving entity; (d) a sale or transfer of substantially all of the assets of the Issuer and its subsidiaries; or (e) a liquidation, winding up or
dissolution of the Issuer.
Under the terms of each of the Restricted Stock Agreement for executives, the Performance-Based Restricted
Stock Agreement for executives and the Nonqualified Stock Option Agreement for executives between the Issuer and the Reporting Person, “involuntary termination” is defined generally as a termination of employment by reason of (a) the
involuntary dismissal of the Reporting Person by the Issuer for reasons other than “cause” (as defined below) or (b) the voluntary resignation of the Reporting Person following the occurrence, without consent, of specified events,
including a material reduction in compensation or benefits, a demotion of more than one job grade, or a significant relocation of the Reporting Person’s principal work location.
Under the terms of such award agreements, “cause” is defined generally as (a) a violation of confidentiality obligations,
(b) acts resulting in being charged with specified types of criminal offenses, (c) conduct that constitutes poor performance, gross neglect, insubordination, willful misconduct or a breach of certain responsibilities to the Issuer or
(d) a determination that the Reporting Person violated laws relating to the workplace.
The foregoing descriptions of the 2016 Plan,
the Restricted Stock Agreement for executives, the Performance-Based Restricted Stock Agreement for executives and the Nonqualified Stock Option Agreement for executives are qualified in their entirety by reference to the complete text of the 2016
Plan and the forms of such agreements, copies of which are filed as exhibits hereto.
Except as described above and elsewhere in this
Schedule 13D, there are no other contracts, arrangements, understandings or relationships (legal or otherwise) between the Reporting Person and any person with respect to any securities of the Issuer.
The information set forth in Items 4, 5 and 7 is incorporated by reference herein.
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Item 7.
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Material to be Filed as Exhibits.
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Exhibit 1 – SecureWorks Corp. 2016 Long-Term
Incentive Plan (incorporated by reference to Exhibit 4.4 to the Issuer’s Registration Statement on Form S-8 filed with the Securities and Exchange Commission (the “Commission”) on April 22, 2016) (Registration
No. 333-210866).
Exhibit 2 – Form of Nonqualified Stock Option Agreement for executives under SecureWorks Corp. 2016 Long-Term
Incentive Plan (incorporated by reference to Exhibit 10.13 to the Issuer’s Registration Statement on Form S-1 filed with the Commission on December 17, 2015 (the “Form S-1”)) (Registration No. 333-208596).
Exhibit 3 – Form of Restricted Stock Agreement for executives under SecureWorks Corp. 2016 Long-Term Incentive Plan (incorporated by
reference to Exhibit 10.15 to the Form S-1) (Registration No. 333-208596).
Exhibit 4 – Form of Performance-Based Restricted
Stock Agreement for executives under the SecureWorks Corp. 2016 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on March 10, 2017) (Commission File
No. 001-37748).
Exhibit 5 – Limited Power of Attorney for Section 13 Reporting Obligations.
Page 6 of 8
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true,
complete and correct.
Dated: May 17, 2017
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MICHAEL R. COTE
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By:
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/s/ George B. Hanna
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Name:
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George B. Hanna
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Title:
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Attorney-in-Fact
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Page 7 of 8
EXHIBIT INDEX
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Exhibit
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Description of Exhibit
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1
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SecureWorks Corp. 2016 Long-Term Incentive Plan (incorporated by reference to Exhibit 4.4 to the Issuer’s Registration Statement on Form S-8 filed with the Securities and Exchange Commission (the “Commission”) on
April 22, 2016) (Registration No. 333-210866).
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2
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Form of Nonqualified Stock Option Agreement for executives under SecureWorks Corp. 2016 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.13 to the Issuer’s Registration Statement on Form S-1 filed with the
Commission on December 17, 2015 (the “Form S-1”)) (Registration No. 333-208596).
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3
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Form of Restricted Stock Agreement for executives under SecureWorks Corp. 2016 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.15 to the Form S-1) (Registration No. 333-208596).
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4
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Form of Performance-Based Restricted Stock Agreement for executives under the SecureWorks Corp. 2016 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the
Commission on March 10, 2017) (Commission File No. 001-37748).
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5
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Limited Power of Attorney for Section 13 Reporting Obligations.
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Page 8 of 8