Exhibit 10.1

 

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March 22, 2019

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Term Employment Agreement

Dear Shella,

Upon your relinquishing your current role as Chief Legal Officer & Corporate
Secretary of Yum China Holdings, Inc. (“YUMC”), we are pleased to offer you the
subject Term Employment Agreement (“Agreement”) with Yum! Restaurants Consulting
(Shanghai) Co., Ltd. (the “Company”) under the following terms and conditions:

1.

Term

This Agreement shall govern your employment with the Company and its affiliates
from May 1, 2019 (the “Effective Date”) to November 30, 2019 (the “Term”). Your
employment with the Company and its affiliates shall terminate upon the
expiration of the Term unless otherwise agreed to between you and the Company.

2.

Work Schedule and Assignment Location

To remain as an active employee of YUMC, you are expected to provide on average
of ten (10) hours of service per week (or an average of 40 hours of service per
month) during the Term, and your assignment location will be Hong Kong and
Shanghai.

3.

Role, Responsibilities and Reporting

Pursuant to this Agreement, you will assume the role of Senior Consultant to
YUMC. In your role as Senior Consultant, you will report to the Chief Executive
Officer (“CEO”) of YUMC. Your scope of service will include, but not be limited
to, the following:

 

•

Advise YUMC management and the Board of Directors of YUMC (the “Board”) on
matters pertaining to Corporate Governance and Compliance;

 

•

Provide counsel and guidance to the Legal and Corporate Secretary function of
YUMC; and

 

•

Other special projects as assigned to you by the CEO.

You are required to review the progress/milestones of your assignments &
projects with your supervisor on monthly basis, or upon reasonable request.

4.

Compensation and Allowance

During the Term, you will be paid a monthly rate of HKD 100,000 (gross). Should
the services required from you exceed 40 hours per month, upon mutual agreement
of such extra hours, you will be paid at an hourly rate of HKD 2,500 (gross) for

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such service. You are also required to submit your monthly time sheet to Aiken
Yuen, CPO for verification. In addition, you will be paid a gross transportation
allowance of RMB 10,000 per month.

The gross monthly and hourly rates as well as the gross transportation allowance
are subject to tax equalization for Hong Kong Tax withholding (Tax
Equalization). In addition, gains realized from the exercise of your vested
stock appreciation rights (“SARs”) or income realized upon the vesting of
restricted stock unit (“RSU”) awards, in each case, granted to you prior to 2018
will continue to be subject to tax equalization for Hong Kong Tax withholding.
For the avoidance of doubt, you will be responsible for taxes in China and Hong
Kong, as applicable, for any income realized on grants awarded to you after
2017, and such income will be subject to Hong Kong and/or China tax withholding
to comply with applicable laws and regulations.

To facilitate the filing of your tax returns in China and Hong Kong, you are
required to furnish your travel record to the Chief People Officer of the YUMC
(to show the number of days of stay in China and Hong Kong, including the date
of entry and departure).

5.

Company Housing

During the Term, you will continue to be provided with your current Company
house lease in Shanghai. If you choose to relinquish housing, you will be
covered in accordance with the T&E standards of the Business Travel Policy.
Utilities expenses will be reimbursed to you at a rate no higher than 5% of the
rental budget. Only actual amounts incurred will be reimbursed by the Company.

6.

Company Contribution to ORSO Provident Fund Plan, Medical, Dental & Life
Insurance Plan

If your work hours in China reach 40 hours per month (on average), you will
continue to be eligible for Company contributions to the ORSO Provident Fund
Plan, Medical and Dental coverage (for employee only) and Life & AD&D insurance
coverage.

7.

Continued Vesting of Unvested LTI grant

During the Term and subject to a minimum of 40 hours per month, your unvested
long-term incentive awards (SARs & RSUs) previously granted to you will continue
to vest in accordance with their normal vesting schedules and such vesting will
cease upon the expiration of the Term unless the Term is extended in accordance
with Section 1.

8.

Business Travel

For approved business travel, expenses will be reimbursed in accordance with the
Company’s business travel policy.

9.

Outside Employment

Subject to the satisfaction of your obligations stipulated under this Agreement
and any other agreements with YUMC and the Company, including the non-compete
and non-disclosure provisions set forth below, you will not be prohibited from
seeking, obtaining or undertaking any employment position, full-time or not,
with another company during the Term or thereafter.

10.

Code of Conduct

As an employee of the Company, you are expected to observe the Company’s Code of
Conduct. You are also expected to obey the laws and regulations and respect the
lawful customs of the People’s Republic of China and any other countries which
you may visit while performing your duties for the Company. Naturally, we would
expect that you would not engage in any employment or business activity that
conflicts with the business interests of the Company.

11.

Discretionary Payment

Subject to your acceptance of this Agreement and your compliance with the terms
set forth herein (including, but not limited to, the non-compete and
non-disclosure provisions stipulated below), and the completion of the Term, you
will be paid in December 2019 a discretionary pro-rata bonus for the period of
January 1, 2019 through April 30, 2019 in an amount of no less than HK$700,000
(gross). Should the actual pro-rated bonus payable under the Company’s annual
incentive program exceed the pro-rata bonus set forth in the prior sentence, the
balance will be paid to you in February

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2020 when the 2019 Team Factor result under the Company’s annual incentive
program is confirmed by the Compensation Committee of the Board. The
discretionary payment is subject to tax equalization for Hong Kong Tax
withholding.

Non-Disclosure

By signing this Agreement, you agree during the Term and thereafter, not to use
for your own or another’s advantage, or reveal to any person, firm, company or
organization, and shall use your best endeavors to prevent the publication or
disclosure of any of the trade secrets, business methods, computer systems or
any information, in written or electronic form, (including strategic plans and
annual operating plans but excluding any such information or data which enters
the public domain except through default) which you knew or ought reasonably to
have known to be confidential concerning the business or affairs of the Company
or any of its affiliates, vendors or customers, so far as they came to your
knowledge during your employment with the Company.

The restriction in this clause shall not apply to any disclosure or use
authorized by the management of the Company or required by law and it shall not
apply so as to prevent you from using your own personal skill in any business in
which you may lawfully engage (subject to clause hereunder) after your
employment with the Company is terminated. In addition, the foregoing shall not
limit your ability to report possible violations of law or regulation to, or
file a charge or complaint with, the United States Securities and Exchange
Commission.

Non-Competition

By signing this Agreement and receiving the compensation and allowance under
Section 4 and the discretionary payment under Section 11 (which is acknowledged
as inclusive of any legally mandated economic compensation for enforcement of
this non-compete covenant), you agree, for the one-year period following the
Effective Date, to not be engaged or interested (whether as principal, servant,
agent, consultant or otherwise) in any trade or business in the People’s
Republic of China or Hong Kong that you have been involved or with which you
have been concerned as part of your employment with the Company and its
affiliates and which is similar to, and by virtue of its location, competes
with, any trade or business being carried on as of the Effective Date by the
Company or any of its affiliates (i.e., the restaurant industry including
without limitation McDonald’s, Burger King, Wendy’s, Popeye, Domino’s,
Starbucks, Subway, Little Caesars Pizza, Papa John’s and Dicos).

Non-Solicitation

By signing this Agreement, you agree that for the three-year period following
the Effective Date, you will not endeavor (whether on your own account or for
any other person, firm, company or organization) to entice away from the Company
or any of its affiliates in the People’s Republic of China, Hong Kong or US, any
employee employed as of the expiration of the Term or at any time within a
period of 12 months prior to that date and with whom the Employee has worked or
with whom he/she has had personal contact as part of his employment with the
Company.

Non-Disparagement

By signing this Agreement, you agree not to do or say anything which criticizes
or disparages the Company or its affiliates, its management practices, or
products, which disrupts or impairs the Company’s normal ongoing business
operations; or which harms the Company’s reputations with its employees,
customers, suppliers, or the public.

Release

By signing this Agreement and upon receipt of the discretionary payment in
connection with the Agreement, you also agree to waive all rights and claims you
may have for any personal or monetary relief arising from your employment with
the Company, or the termination of employment with the Company.

Reasonable Cooperation in Investigation and Litigation

In the event the Company becomes involved in investigations, audits or
inquiries, tax examinations or legal proceedings, by a judicial, governmental or
regulatory authority, of any nature, related directly or indirectly to events
that occurred during your employment and about which you have or may have
personal knowledge, you agree that you will be reasonably available upon
reasonable notice from the Company, to answer discovery requests, give
depositions or testify, with respect to matters of which you have or may have
knowledge as a result of or in connection with your employment relationship with
the Company. In performing the obligations under this section, you agree that
you will truthfully, forthrightly and completely provide the information
reasonably requested. The Company will reimburse you for all reasonable
out-of-pocket expenses incurred by you in connection with such cooperation. The
parties understand and

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acknowledge that this provision is not intended to restrict your ability to
become employed by another employer or unreasonably interfere with such
employment.

12.

Termination of the Term

A two-month notice period is to be provided by either party if the Term has to
be terminated prior to November 30, 2019.

13.

Severability

If at any time any provision of this Agreement is or becomes illegal, invalid or
unenforceable in any respect, the legality, validity and enforceability of the
remaining provisions shall not be impaired or affected.

14.

Repatriation

Repatriation upon completion of the Term will be administered in accordance with
the Company’s policies.

Kindly acknowledge your acceptance of the above terms by signing and returning
the duplicate of this Agreement to the undersigned.

Yours sincerely,

For and on behalf of the Company

 

/s/ Aiken Yuen

 

 

 

 

 

Aiken Yuen

 

 

Chief People Officer, YUMC

 

 

 

 

 

 

 

 

I, Shella Ng, confirm that I have read and agreed to the terms outlined in this
letter.

 

 

 

 

 

 

/s/ Shella Ng

 

March 22, 2019

 

 

 

Shella Ng

 

Date

 

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