Exhibit 4.56

 

This is an English translation

 

Agreement No.:

121200102035

 

 

 

 

 

 

International Electronic Headquarters ofthe Electronic Zone

Qihu 360 Headquarters Program

 

 

 

Purchase Agreement for

Floors 5-19 of Tower A

 

 

 

 

 

 

 

 

 

 

 

Beijing Electronic Zone Co., Ltd.

Qifei Xiangyi (Beijing) Software Co., Ltd.

 

 

 

August 31, 2012

Beijing

 

 

Party A: Beijing Electronic Zone Co., Ltd.

Address: A 12 Jiuxianqiao Road, ChaoyangDistrict, Beijing

Zip Code: 100015

Business License No: 110000005030270

Legal Representative and Person in Charge:Wang Yan                   Contact Tel.: 010-58833501

 

PartyB: Qifei Xiangyi (Beijing) Software Co., Ltd.,

Address: Room 536, Block 46, No. 9 RadioComponents Factory (2-1), Shengou Village, Chaoyang District, Beijing

Zip Code: 100025

Business License No: 110000450214306

Legal Representative and Person in Charge:Qi Xiangdong              Contact Tel.: 58781000

 

Whereas:

1.	Party A has undertakenthe reconstruction of the Electronic Zone as an old industrial base, and the construction of the East Area of the Electronic Zonein Zhongguancun Science Park, as well as investment solicitation thereof.

 

1.1	Party A haslegally obtained the land use rights to the state-owned land 3# with a size of 19,669.36 square meters (usable floor area) at theInternational Electronic Headquarters of the Electronic Zone (Land Use Right Certificate: Jing Chao Guo Yong (2007) No. 0479; landuse: research and development; expiration date: December 8, 2056).

 

1.2	Party A warrantsthat the state-owned land use rights regarding the Property (as defined herein) under this Agreement and the construction in progressare free from any pledge, lawsuit, arbitration or other limitation of rights.

 

1.3	Party A hasobtained the approval for the Project of Building 2# on Land 3# from the competent authorities, the Planned Permit of Building(No.: Jian Zi No. 110000200900546, 2009 Gui Jian Zi No. 0214) and the Building Construction Permit (No.: [2010] Shi [Chao] JianZi No. 0198).

 

1.4	As of the dateof this Agreement, Party B was informed that the main body, electrical and mechanical engineering and architectural curtain wallof the Property had been completed and the outdoor landscaping was under construction. Party B agrees to purchase the Propertysubject to Appendix 5 “Standards on Delivery of the Property” of this Agreement.

 

2.	As a leadinginternet security software product and service provider, Party B meets the industrial guidance of the Science Park of the ElectronicZone in respect of industrial positioning and business. Upon fully understanding the project of “International ElectronicHeadquarters of Zhongguancun Electronic Zone” as well as other information concerned, Party B decides to purchase Building2# on Land 3# in the International Electronic Headquarters from Party A to locate its headquarters and use the Property for theapproved purposes and undertakes that it will register the Property as its principal office and for the purpose of tax paymentafter entry.

 

Both parties have reachedthe following agreement through negotiation based on equality, voluntariness and fairness and in accordance with the relevant lawsand regulations.

 

**Article 1 The Property**

 

1.1	Scope of theProperty:

 

For the purpose ofthis Agreement, the “Property” refers to Floors 5-19, Tower A, Building 2# on Land 3# at International ElectronicHeadquarters, Jiuxianqiao Road, Chaoyang District, Beijing (see Appendix 1). The main body of the building is a frame-shearstructure with 19 floors. The Property consists of floors 5-19 above the ground floor of the west wing, floors 5-12 above theground floor of the west wing, 6th and 7th units (with corridors) between floor 12 and floor 1#. The gross floor area of theProperty is estimated at 24,934.56 square meters

 

See Appendix 2 fordetails. The area indicated above shall be subject to registration in the Certificate of Title.

 

1.2	Confirmationof Area of the Property:

 

The gross floor areaof the Property is estimated at 24,934.56 square meters (see Appendix 3 for details). Both parties agree that the floorarea will be for reference only whereas the actual floor area of the Property shall be subject to the confirmed area to be registeredunder the relevant Certificate of Title.

 

**Article 2 PurchaseConsideration of the Property and Schedule of Payment**

 

2.1	Considerationof the Property:

 

The purchase considerationof the Property shall be RMB20,000 (RMB Twenty Thousand) per square meter of gross floor area and is estimated to be RMB498,691,200(RMB Four Hundred and Ninety Eight Million Six Hundred and Ninety One Thousand and Two Hundred) (the “Purchase Consideration”)which is calculated on the basis of the estimated gross floor area.

 

2.2	Payment

 

The final price shallbe adjusted and settled according to the said registered title area, and in case of any divergence between the contractual areaand such registered title area, the latter shall prevail. The payment shall be settled within 30 working days after completionof the title registration from both parties and agreement of the purchase consideration adjustment (if any) in writing.

 

2.3	Schedule ofPayment

 

Party B will settlethe Purchase Consideration by installments.

 

The schedule of paymentshall be as follows:

 

2.3.1	Party B shallpay five percent (5%) of the Purchase Consideration, i.e., RMB24,934,560 (RMB Twenty Four Million Nine Hundred and ThirtyFour Thousand Five Hundred and Sixty) to Party A within 30 working days after execution of this Agreement).

 

2.3.2	Party B shallpay fifteen percent (15%) of the Purchase Consideration, i.e., RMB74,803,680 (RMB Seventy Four Million Eight Hundred andThree Thousand Six Hundred and Eighty) to Party A before August 31, 2013.

 

2.3.3	Party B shallpay the remaining eighty percent (80%) of the Purchase Consideration, i.e., RMB398,952,960 (Three Hundred and Ninety Eight MillionNine Hundred and Fifty Two Thousand Nine Hundred and Sixty) to Party A before January 31, 2014.

 

2.4	Both partiesagree that Party A shall issue an official invoice to Party B upon receipt of the total Purchase Consideration paid by Party Bpursuant to the schedule prescribed in Article 2.3.

 

2.5	Party A’sBank Account:

 

Party A notifies PartyB to directly remit the said installments to Party A’s bank account, details of which are as follows:

A/C bank: ElectronicZone Science Park Branch, China Construction Bank

Account name: BeijingElectronic Zone Co., Ltd.

Account No:

 

**Article 3 Deliveryof the Property**

 

3.1	Party A shallcomplete construction and inspection of the Property before February 10, 2014 (hereinafter referred to as the “agreeddate of delivery”) and notify Party B to acknowledge acceptance of the Property in writing twenty (20) working days priorto the agreed date of delivery. Party A shall be entitled to refuse delivery of the Property without any liability for delay ofdelivery in the case Party B has caused any delay in payment of the Purchase Consideration and Party A fails to receive the agreedamount before the agreed date of delivery. The following standards shall be satisfied upon delivery of the Property:

 

(1)	The Propertybeing completed and be deliverable;

(2)	The Approvalfor Acceptance of Planning and the Form of Final Completion for Filing regarding the Property being obtained;

(3)	The utilitiesof water supply and power supply and elevators are in working order;

(4)	All other facilitiesof the Property shall reach the standards for delivery as prescribed in Appendix 5; and

(5)	The Propertyshall satisfy other legal standards for completion and comprehensive inspection.

 

When deliveringthe Property, Party A shall provide Party B with the construction and project materials related to the Property, including:

 

(1)	Final acceptancematerials, such as the general plan of completed projects and as-built drawings of single building, structure, equipment and supportedfacilities;

(2)	Copies of theForm of Final Completion for Filing; and

(3)	Other materialsrelevant to the Property and the property management thereof.

 

3.2	Party B shallinspect the Property within twenty (20) working days after receiving Party A’s delivery notice and shall issue an acceptancenotice if the Property passes the acceptance inspection. In the case where the Property has been found in violation with any requirementunder national or local laws, regulations, rules and norms concerned, or as well as Appendix 5 during inspection, Party B shallissue a rectification notice in writing. Party A shall complete such rectification within one month; if impossible, it shall providea written rectification commitment to Party B, assuring Party B of the term of rectification and quality. If Party B believes theProperty, after rectification, is in material violation with any relevant laws and regulations, or significantly inconsistent withthe delivery standards and may actually affect the legal rights and interests of Party B, Party B may appoint an evaluation agencyacceptable to both parties to conduct an evaluation. If Party B’s opinion is confirmed after evaluation, Party B shall beentitled to refuse delivery by sending a written notice to Party A and the liabilities for delay of delivery as well as the evaluationfees shall be borne by Party A. Otherwise, Party B shall bear the evaluation fees.

 

3.3	Failure of PartyB to issue an acceptance notice or a written rectification notice within 20 working days after Party A issues the delivery noticeshall be deemed as acceptance by Party B of the Property.

 

3.4	Both partiesshall execute the Delivery Receipt of the Property after the inspection and acceptance of the Property. The date of the DeliveryReceipt of the Property shall be deemed as the date of actual delivery of the Property (hereinafter referred to as the “actualdelivery date”) and Party A shall be deemed performed of its obligation of delivery. If Party B delays execution of or isreluctant to execute the Delivery Receipt of the Property after the Property after the inspection and acceptance of the Property,or if Party A provides the rectification commitment, it shall be deemed that Party A has performed its obligation of delivery.

 

3.5	Both partiesagree that any and all risks of damage and loss of the Property shall be transferred to Party B and any and all expenses relatedto the Property, including property management fees and utilities fees, shall be borne by Party B from the actual delivery date.Party B shall assume any and all liabilities and obligations stipulated in the rules of the property management company concerningproperty use, management and maintenance.

 

3.6	If the Propertyfails to be delivered before or on the agreed date of delivery due to any fault on the part of Party B, the risks and expensesincurred during this period, including damage or loss of the Property and property management fee, shall be assumed by Party B.

 

3.7	Both partiesshall separately execute a maintenance agreement.

 

3.8	Party B shallhave the right to name the Property or set up its trade name, logo, nameplate, direction boards or billboards on the roof or onthe external wall of or around the Property, provided that the specific plan on such naming and setup shall be subject to the consentof Party A and be harmonious with the overall planning of the International Electronic Headquarters and conform to the requirementsby the competent authorities in this regard. Party B shall be liable for going through relevant approval procedures and Party Apromises to provide relevant documents and certifications. All the expenses arising from or related to such approval and examinationprocedures shall be borne by Party B.

 

3.9	Given the titlesof the building, of which the Property is a part, and the corresponding underground parking area belongs to Party A, Party A agreeto lease the remaining parking lots to Party B in the proportion of the area it bought after appropriating several public parkinglots;

 

3.9.1	Party A maydetermine the specific position of such parking lots in the principle of a near position to the Property;

 

3.9.2	Party A shallgrant rent concession to Party B;

 

3.9.3	The parkinglots rent by Party B may not be used for other purposes except for parking by employees of Party B; and

 

3.9.4	The number,position and rent of the parking lots shall be separately negotiated by both parties.

 

3.10	Party B agreesto appoint Party A’s property management company to provide property management services, which may be separately stipulatedin the Property Management Service Agreement.

 

**Article 4 Certificateof Title**

 

4.1	Party A shallguarantee to obtain the Certificate of Title in Party B’s name within three (3) years after delivery of the Property, providedthat Party A receives the price due in full amount (except for the balance for difference between the estimated and actual areas)and complete documents required. If Party A delays or fails to obtain the Certificate of Title due to any fault on the part ofParty B, including but without limitation to failure of Party B to pay any taxes or fees, Party A will not assume any breach liabilities,except for assistance to obtain the Certificate of Tile.

 

4.2	Both partiesagree that the taxes and fees incurred during the process of obtaining the Certificate of Title shall be assumed by both partiesrespectively pursuant to relevant national provisions.

 

4.3	Since the Propertyis located in the Scientific Park of Zhongguancun Electronic Zone, Party B is not allowed to transfer it in accordance with therelevant provisions in principle; if transfer is necessary, Party B shall give a prior notice to Party A and Party A shall havethe preemptive rights under the same conditions.

 

**Article 5 Liabilitiesfor Breach**

 

5.1	Principle

 

Both parties shallenjoy and perform the rights and obligations as stipulated in this Agreement in good faith. In case of any breach of this Agreement,the default party shall assume its breach liabilities and pay damages to the non-default party. The express provisions on percentageof damages stipulated in this Agreement, if any, shall be executed. If both parties breach the Agreement, each party shall respectivelyassume its liabilities according to the extent or severity of its fault.

 

The non-default partyshall be entitled to require the default party to make corrections and any legal liabilities arising thereof shall be assumed bythe default party.

 

5.2	Party A’sLiabilities for Breach

 

The following provisionsshall apply if Party A fails to perform any of its obligations within the time limits as stipulated in this Agreement:

 

5.2.1	Party A shallpay Party B the damages equal to 0.01% of the amount paid by Party B per day if the Property failed to be delivered to Party Bbefore or on the agreed date of delivery due to any fault on the part of Party A. Party B shall be entitled to cancel this Agreementif the Property has not been delivered more than 180 days after the agreed date of delivery. If Party B cancels this Agreement,Party A shall refund the amount paid by Party B within 30 days from the date of Party B’s notice on cancellation of the agreementand pay the damages equal to ten percent (10%) of the total price of this Agreement to Party B. If Party B does not choose to cancelthis Agreement, Party A shall pay Party B the damages equal to 0.01% of the amount paid by Party B per day from the next day tothe agreed date of delivery and until the actual delivery date and this Agreement shall continue to be performed.

 

5.2.2	Party A shallpay Party B the damages equal to 0.01% of the amount paid by Party B per day if Party A fails to perform its obligation under Article4.1 due to any fault on the part of Party A. Party B shall be entitled to cancel this Agreement if Party A fails to perform suchobligation more than 180 days after the agreed date. If Party B cancels this Agreement, Party A shall refund the amount paid byParty B within 30 days from the date of Party B’s notice on cancellation of the agreement and pay the damages equal to tenpercent (10%) of the total price of this Agreement to Party B.

 

5.2.3	Except asotherwise stipulated herein, Party A undertakes that it will not resell the Property to others and it has not and will not createany mortgage over the Property; otherwise, Party A shall pay the damages equal to thirty percent (30%) of the total price of thisAgreement to Party B and continue to perform this Agreement at Party B’s discretion.

 

5.3	Party B’sLiabilities for Breach

 

The following provisionsshall apply if Party B fails to perform any of its obligations within the time limits as stipulated in this Agreement:

 

5.3.1	If Party Bfails to pay any amount within 180 days after the date of payment due to any fault on the part of Party B, Party B shallpay the damages equal to 0.01% of the amount due per day to Party A from the next day to the date of payment as stipulated in thisAgreement and until the amount due is paid in full amount and this Agreement shall continue to be performed.

 

5.3.2	Party B agreesthat if Party B does not pay any amount due more than 180 days after the date of payment due to any fault on the part of PartyB, Party A may cancel this Agreement, resell the Property to any person and refund the amount paid by Party B, and Party B shallpay Party A the damages equal to ten percent (10%) of the total price of this Agreement. If Party A does not choose to cancel thisAgreement, Party B shall pay Party A the damages equal to 0.01% of the amount overdue per day from the next day to the date ofpayment as stipulated in this Agreement and until the amount due is paid in full amount and this Agreement shall continue to beperformed.

 

5.4	Except as specificallystipulated in Article 6 herein and exercise by either party of its right to unilaterally cancel this Agreement pursuant to theAgreement, neither party may terminate this Agreement without cause. Any party who cancels this Agreement for causes other thanlegal provision or agreements herein shall pay the other party damages equal to ten percent (10%) of the total price of this Agreement.

 

5.5	Any party whohas to refund all amounts and/or pay damages to the other party pursuant to this Agreement due to its breach of the Agreement,shall refund all amounts as stipulated in the Agreement and pay such damages within thirty (30) days after receiving the writtennotice from the non-default party; otherwise, the default party shall pay the non-default party damages equal to 0.01% of the totalprice per day from the date when it shall pay such damages and until the damages are paid in full amount.

 

Both parties acknowledgethat the non-default party shall be entitled to deduct the damages or other compensations for damage that the default party shallpay pursuant to the Agreement from the amounts payable or receivable.

 

**Article 6 Terminationof Agreement**

 

6.1	This Agreementmay:

 

(1)	be early terminatedif both parties reach a new agreement in writing through negotiations;

(2)	be automaticallyterminated after both parties fully perform their obligations;

(3)	be terminatedby one party by sending a written notice to the other party who is or becomes legally incapable of continuing to perform this Agreementdue to bankruptcy, wind-up or cancellation of business license;

(4)	be terminatedby either party by sending a notice to the other party if this Agreement cannot be performed due to any force majeure event; or

(5)	be terminatedor cancelled due to other reasons as stipulated in laws, regulations or this Agreement.

 

6.2	Either partywho terminates or cancels this Agreement pursuant to laws or regulations or this Agreement, shall issue a written notice of terminationor cancellation to the other party, and this Agreement shall be terminated or cancelled upon receipt of such notice by the otherparty. The non-default party shall be entitled to make claims against the other party in accordance with laws, regulations andthis Agreement.

 

**Article 7 Confidentiality**

 

7.1	Except as otherwisestipulated in this Agreement, laws and regulations and provisions of stock exchanges, each party shall, at any time after the dateof this Agreement, keep confidential the following information it obtains in the process of negotiation, execution and performanceof this Agreement (hereinafter referred to as the “confidential information”) and may not disclose such informationto a third party or use such information for purposes other than stipulated in this Agreement without prior written consent ofthe other party:

 

(1)	Any informationrelated to negotiations concerning this Agreement;

(2)	Any informationrelated to any trade or term under this Agreement; and

(3)	Any informationrelated to both parties to this Agreement and their affiliates.

 

7.2	Each party shallcause its employees, officials, representatives or agents, professional consultants or other affiliates or associated persons toperform the confidential obligation under Article 7.1 herein and prohibits the persons who access to such information from usingsuch confidential information for any business activities irrelevant to this Agreement.

 

7.3	The confidentialityobligation under Article 7 shall not apply to such confidential information that:

 

(1)	has been oris known to the public before disclosure by the other party;

(2)	is requiredto be disclosed or used by mandatory provisions of law or by court;

(3)	is disclosedor used with the prior written consent of the other party; or

(4)	is announcedor disclosed in accordance with this Agreement or for the purpose of fulfilling the transactions under this Agreement (includingannouncement in the trading system).

 

7.4	The confidentialityobligation under this Agreement shall survive the termination of this Agreement.

 

**Article 8 ForceMajeure**

 

8.1	A force majeureevent refers to any event that is unpredictable, inevitable and uncontrollable and may prevent the performance of this Agreement,including but without limitation to such natural disasters as flood and earthquake and such social events as war, strike, riot,and promulgation of new laws and regulations and launch of new policies, administrative measures by government and governmentalacts.

 

8.2	In case of anyforce majeure event, the affected party shall notify the other party of the force majeure event in a timely manner and providethe proving document issued by relevant organs in the place where the event occurs within 14 days after the force majeure eventoccurs. In addition, both parties shall do their utmost to take necessary measures to reduce the impacts of such force majeureevent. The prevented party shall notify the other party in a timely manner after the impact of such force majeure event eliminates.

 

8.3	Except as otherwiseprovided for by law, either party who is prevented from performing this Agreement by force majeure may be exempted from any breachliabilities according to the impacts of such force majeure.

 

**Article 9 Effectivenessand Version**

 

9.1	This Agreementshall enter into force upon signature and seal by both parties.

 

9.2	This Agreementhas been prepared in six (6) originals and each party keeps three (3) of them, which shall be of equal legal force.

 

**Article 10 DisputeSettlement**

 

10.1	 Any disputebetween both parties shall be settled through negotiations; if a negotiation fails, the dispute may be filed to the People’scourt for settlement in the place where the Property is located in accordance with the laws and regulations of the People’sRepublic of China.

 

**Article 11 Appendixes to theAgreement**

 

Appendix 1: Location of InternationalElectronic Headquarters

Appendix 2: General Plan of Land3# in International Electronic Headquarters

Appendix3: Technical Report on Estimation of the Area of Building 2# on Land 3# in International Electronic Headquarters (subject to thereport with the special stamp for mapping results submitted for filing)

Appendix 4: Copies of BusinessLicense of Both Parties (with Official Stamps)

Appendix 5: Standards on Deliveryof the Property

Appendix 6: Planning of Property(for reference only and subject to as-built drawings)

 

 

Party A: Beijing Electronic Zone Co., Ltd.

(Company Chop):                   	*/s/ [Company Stamp of Beijing Electronic Zone Co., Ltd.]*

Legal (Authorized) Representative:                	/s/

Signing Date: August 31, 2012 in Beijing

 

Party B: Qifei Xiangyi (Beijing) SoftwareCo., Ltd.

(Company Chop):                   	*/s/ [Company Stamp of Qifei Xiangyi (Beijing) Software Co., Ltd.]*

Legal (Authorized) Representative:                /s/

Signing Date: August 31, 2012 in Beijing