Document:

Exhibit 10.2

 

QIHOO TECHNOLOGY COMPANY LIMITED

 

RULES OF THE EMPLOYEE SHARE VESTING SCHEME

(2006)

 

1.                                               INTERPRETATION

 

1.1                                          In these Rules:

 

“Articles” means the articles of association of the Company;

 

“Auditors” means the auditors for the time being of the Company;

 

“Cessation Date” means the date on which a notice is given by or to a Grantee to terminate his employment with the Group;

 

“Company” means Qihoo Technology Company Limited (registered in the Cayman Islands);

 

“Date of Grant” means in respect of any Grantee, the date of the Notice of Grant by which the monetary benefit of the Shares are granted in accordance with clause 3;

 

“Disposal” has the meaning ascribed to it under clause 5.2;

 

“Employee” means any employee or consultants of the Company or of any subsidiary of the Company;

 

“Exit” means (i) a Listing, (ii) a sale of all or substantially all of the issued share capital of the Company, (iii) a sale by the Company of all or substantially all of its assets, (iv) the passing of an effective resolution or the making of an order of a competent court for the winding up of the Company or (v) or the similar events that may occur pursuant to a resolution duly passed by the Board of Directors of the Company;

 

“Grantee” means any Employee to whom the right to the monetary benefits of a Share or Shares is granted in accordance with the terms of this Scheme;

 

“Group” means the Company and its subsidiaries;

 

“HK$” means Hong Kong dollars, the lawful currency of Hong Kong;

 

“Hong Kong” means the Hong Kong Special Administrative Region of the People’s Republic of China;

 

 

“Listing” means the admission of all or any of the share capital of the Company or any holding company incorporated for such purpose to trading on a recognized stock exchange;

 

“Nominee” means such person as designated by the Company at its sole and absolute discretion to hold the Shares which are granted or vested in accordance with the Scheme on behalf of the Grantees;

 

“Notice of Grant” means a notice of grant issued by the Company in accordance with clause 3.2;

 

“Reorganisation” has the meaning set out in clause 8.1;

 

“Rules” means the rules of the Scheme;

 

“Scheme” means this Share Vesting Scheme as amended from time to time;

 

“Shares” means ordinary shares of US$0.001 each of the Company (or any other denomination or renominated value of share created from the sub-division, consolidation, reclassification or reorganisation thereof);

 

“grant” or “granting” means that the Company notifies an employee that he or she is entitled to be granted the right to the monetary benefits in respect of a certain number of Shares pursuant to this Scheme;

 

“vest” or “vesting” means, in such event that the right to the monetary benefits in respect of a certain number of Shares has been granted to an employee, after each date set out in Clause 4.1 respectively or such other date as the Company shall determine and so notify the Grantee in writing, the right to the monetary benefits in respect of such corresponding number of Shares is held by Nominee on behalf of the Employee and the Employee shall have the right to all the monetary benefits deriving therefrom when the Shares are disposed of in accordance with this Scheme;

 

“Vesting Date” means, in respect of any Grantee and any grant by the Company to such Grantee, the date on which the right to the monetary benefits in respect of the Shares is vested in him pursuant to such grant;

 

1.2                                          Words and expressions defined in the Companies Ordinance (Chapter 32 of the Laws of Hong Kong) including, without limitation, “subsidiary” and “holding company” shall, unless the context otherwise requires, have the same meanings where used in these Rules.

 

1.3                                          Headings are used in these Rules for convenience only and shall not affect their construction or interpretation.

 

1.4                                          These Rules shall be governed by and construed in accordance with the law of Hong Kong and the Company and each Grantee submit to the non-exclusive jurisdiction of the courts of Hong Kong.

 

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2.                                               ADMINISTRATION

 

This Scheme shall be subject to the administration of the Company whose decision as to all matters arising in relation to this Scheme or its interpretation or effect shall (save as otherwise provided herein) be final and binding on all parties.

 

3.                                               GRANT OF SHARES

 

3.1                                          The Company may grant to any Employee such number of Shares as the Company shall determine at its sole and absolute discretion on the terms of this Scheme.

 

3.2                                          Shares will be granted to an Employee by delivery of a notice in writing in such form as the Company may from time to time determine specifying the number of Shares is granted and any other terms and conditions (including, without limitation, conditions as to disposal) on which it is granted.  All Shares shall be granted and vested on the terms of these Rules.

 

3.3                                          Any Grantee to whom a Notice of Grant is delivered may, by notice in writing to the Company given within 30 days after the relevant Date of Grant, renounce his rights thereto, in which event such Shares shall be deemed for all purposes not to have been granted.

 

4.                                               VESTING AND LAPSE OF UNVESTED RIGHT S TO MONETARY BENEFITS IN RESPECT OF SHARES

 

4.1                                          Shares granted under this Scheme will (unless the Company shall otherwise determine and so notify the Grantee in writing) vest on the Grantee as follows:

 

4.1.1                                as to 15 per cent of the aggregate number of Shares so granted, 12 months after the Date of Commencement;

 

4.1.2                                as to 20 per cent of the aggregate number of Shares so granted, 24 months after the Date of Commencement;

 

4.1.3                                as to 30 per cent of the aggregate number of Shares so granted, 36 months after the Date of Commencement;

 

4.1.4                                as to 35 per cent of the aggregate number of Shares so granted, 48 months after the Date of Commencement.

 

4.2                                          Notwithstanding any other provision of these Rules or any Notice of Grant or the terms on which any Share is granted or vested, any Shares granted or vested in accordance with this Scheme will, in all cases, be held by the Nominee or Nominees, unless the Company shall otherwise agree in writing, and all rights (including without limitation, the voting rights and the right to receive the share certificates etc) attached to such Shares will be exercised by the Nominee(s) at its sole and absolute discretion, except that the Grantee shall have the right to all the monetary benefits (“Rights to Monetary Benefits”) deriving from the Shares Vested when the Shares are disposed of in accordance with this Scheme.

 

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4.3                                          In the event that any Grantee ceases to be an Employee of the Group for whatever reasons, all Shares (and the Rights to Monetary Benefits thereto) remaining unvested at the Cessation Date, shall automatically lapse.

 

4.4                                          In the event of any Reorganisation, the numbers of Shares granted or vested in accordance with this Scheme will be adjusted, in such manner as the Company may determine, at its sole and absolute discretion, to be in its opinion fair and reasonable in accordance with clause 7.

 

5.                                               DISPOSAL OF SHARES

 

5.1                                          Any Shares granted or vested hereunder (and all Rights to Monetary Benefits attached thereto) shall be personal to the Grantee and shall not be assignable, unless the Company shall otherwise agree in writing.  No Grantee shall in any way sell, transfer, charge, mortgage, encumber, create any interest (legal or beneficial) or otherwise dispose of in favour of any third party over or in relation to any Shares or the Rights to Monetary Benefits attached thereto other than in accordance with the prior written approval of the Company.  No person other than the named Grantee thereof and the Nominee(s), as the case may, may disposal of any Shares (and the Rights to Monetary Benefits attached thereto), unless the Company shall otherwise agree in writing.

 

5.2                                          Notwithstanding any other provision of these Rules or any Notice of Grant or the terms on which any Shares are granted or vested, no Shares may be sold, transferred, charged, mortgaged, encumbered or created any interest (legal or beneficial) or otherwise disposed of (“Disposal”) prior to the occurrence of an Exit, unless the Company shall otherwise agree and so notify you in writing separately.

 

5.3                                          In the event that an Exit is proposed:

 

 5.3.1                             the Company shall use all reasonable endeavours (to the extent permitted by law) to notify all holders of Shares in advance of the Exit;

 

 5.3.2                             a Disposal made following such notice shall be:

 

(a)                                           conditional upon the Exit becoming unconditionally effective; and

 

(b)                                          deemed to

 

(i)                                              authorise the Nominee to do all things and exercise all rights to facilitate the effective conclusion of the Exit; and

 

(ii)                                           include on behalf of the relevant Grantee an undertaking to do all things within his power to facilitate the effective conclusion of the Exit, and (if so required by the Company) to execute a power of attorney authorizing one or more directors of the

 

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Company to do such things and exercise such rights on his behalf.

 

 5.3.3                             the Company may, at its sole and absolute discretion, procure the Nominee(s) to transfer to the Grantee the Shares which have been vested on him.

 

5.4                                          Notwithstanding any other provision of these Rules or any Notice of Grant or the terms on which any Shares are granted or vested, the Disposal by a Grantee of any Shares vested in accordance with this Scheme shall, in all cases, be implemented and exercised by and through the Nominee(s), unless the Company shall otherwise agree in writing.

 

6.                                               REPURCHASE OF VESTED SHARES

 

6.1     All Shares vested on any Grantee pursuant to this Scheme shall be subject to the Company’s rights to repurchase as set out in the remaining provisions of this Clause 6.

 

6.2                                          If the employment of a Grantee with the Group is terminated for whatsoever reason:

 

(a)                                              on or before the second(2th) anniversary of his Date of Commencement, all the Shares already vested on him will be subject to the repurchase by the Company at an aggregate repurchase price of RMB1.00 and the Grantee shall not have any claim whatsoever against the Company and/or the Nominee in respect of such repurchase;

 

(b)                                             after the second (2th) anniversary but on or before the fourth(4th) anniversary of his Date of Commencement, 50% of all the Shares already vested on him will be subject to the repurchase by the Company at an aggregate repurchase price of RMB1.00 and the Grantee shall not have any claim whatsoever against the Company and/or the Nominee in respect of such repurchase, PROVIDED that if the employment of such Grantee with the Group is terminated as a result of  (i) the Grantee’s theft, conversion, misappropriation, or embezzlement of any asset or property of the Group; (ii) the Grantee being imprisoned or convicted of any criminal offence involving dishonesty or punishable with six (6) months or more imprisonment; or (iii) the Grantee’s material breach of any provision contained in his employment contract with the Group, all the Shares (instead of 50% thereof) already vested on him will be subject to the repurchase by the Company at an aggregate repurchase price of RMB1.00; or

 

(c)                                              after the fourth(4th) anniversary of his Date of Commencement, no Shares already vested on him shall be repurchased by the Company, PROVIDED that if the employment of such Grantee with the Group is terminated as a result of  (i) the Grantee’s theft, conversion, misappropriation, or embezzlement of any asset or property of the Group; or (ii) the Grantee’s material breach of any provision

 

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contained in his employment contract with the Group, all the Shares already vested on him will be subject to the repurchase by the Company at an aggregate repurchase price of RMB1.00 and the Grantee shall not have any claim whatsoever against the Company and/or the Nominee in respect of such repurchase.

 

6.3                                 The Company’s rights to repurchase the vested Shares in accordance with this Clause 6 shall be referred to hereinafter as “Repurchase Right” and be subject to the terms and provisions as set forth in Exhibit A attached hereto.

 

7.                                               VOTING

 

7.1                                          Shares vested on any Grantee will be subject to the provisions of the Articles and will rank pari passu in all respects with the existing fully paid Shares in issue on the relevant Vesting Date, and will entitle the holders thereof to participate in all dividends or other distributions paid or made on or after the Vesting Date, save that no voting rights attached to or associated with the Shares vested in accordance with this Scheme shall be exercised by the Grantee and the Nominee shall have the unfettered right to exercise, at its sole and absolute discretion, such voting rights.  By accepting the grant by the Company of any Shares, the Grantee will be deemed to have waived such voting rights and have unconditionally and irrevocably authorized the Nominee(s) holding the relevant Shares to exercise such rights.

 

7.2    No Employee shall be entitled to any rights, interest or benefits attached to the Shares granted pursuant to this Scheme unless and until such Shares have been vested on him in accordance with the terms of this Scheme.

 

8.                                               REORGANISATION OF CAPITAL STRUCTURE

 

8.1                                          In the event of any alteration in the capital structure of the Company, arising from capitalization of profits or reserves, consolidation, subdivision or reduction of the share capital of the Company (a “Reorganisation”), such corresponding adjustments (if any) may be made in the number or nominal amount of any Shares granted or vested in accordance with this Scheme, as the Auditors shall, at the request of the Company or any Grantee, certify in writing to be in their opinion fair and reasonable, provided that any issue of Shares or other securities of the Company for cash or other valuable consideration shall not be regarded as a circumstance requiring any such adjustments.

 

8.2                                          The capacity of the Auditors in this clause is that of experts and not as arbitrators and their certification shall, in the absence of manifest error, be final and binding on the Company and the relevant Grantees.

 

9.                                               DISPUTES

 

Any dispute arising in connection with this Scheme (whether as to the number of Shares the subject of a grant or otherwise) shall be referred to the decision of the Board of the Company whose decision shall, in the absence of manifest error, be final and binding.

 

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10.                                        ALTERATION OF THIS SCHEME

 

This Scheme may be amended by the Company from time to time as it thinks fit, provided that notice in writing shall be given to the Grantees in respect of such amendment.

 

11.                                        TAXATION

 

11.1                                    A Grantee shall be responsible for obtaining any governmental or other official consent that may be required in any jurisdiction in order to permit the grant to, vesting on or Disposal by him of any Shares.  The Company shall not be responsible for any failure by a Grantee to obtain any such consent or for any taxation, duty, social security payment or other liability to which a Grantee may become subject as a result of his participation in this Scheme.

 

11.2                                    To the greatest extent permitted by law, each Grantee shall pay to the Company on demand an amount equal to the full amount of any actual or future liability to any taxation, levy, duty, social security or other payment incurred by the Company or any other member of the Group arising out of the grant to, vesting on or disposal by him of any Shares.

 

12.                                        MISCELLANEOUS

 

12.1                                    This Scheme and the grant of any Shares hereunder shall not form part of any contract of employment between any member of the Group and any Employee, and the rights and obligations of any Employee under the terms of his office or employment shall not be affected by his participation in this Scheme.

 

12.2                                    The Company shall bear the costs of establishing and administering this Scheme, including any costs of the Nominee(s) and Auditors in relation to the provision by them of any service in relation to this Scheme.

 

12.3                                    Each holder of Shares which have been vested shall be entitled to receive copies of any notices or other documents sent by the Company to other shareholders of the Company in relation to any proposal for an Exit, but not otherwise.

 

12.4                                    Any notice or other communication between the Company and a Grantee may be given by sending the same by prepaid post or by personal delivery to, in the case of the Company, its principal place of business in Beijing and, in the case of the Grantee, in person or at his address as notified to the Company.

 

12.5                                    Any notice or other communication if sent by the Grantee shall be irrevocable and shall not be effective until actually received by the Company.

 

12.6                                    Any notice or other communication if sent to the Grantee shall be deemed to be given or made:-

 

(a)                                          one day after the date of posting, if sent by mail; and

 

(b)                                         when delivered, if delivered by hand.

 

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EXHIBIT A

 

RIGHTS TO REPURCHASE VESTED SHARES

 

1.                             Exercise of Repurchase Right

 

The repurchase by the Company of the Vested Shares pursuant to the Repurchase Right shall be effected by the payment of the consideration (as provided for under Clause 6.2) delivered to the Grantee within ninety (90) days after the Cessation Date without further notification to or consent from, such Grantee.  Payment shall be made in cash or cash equivalents or by canceling indebtedness to the Company incurred by Grantee.  The Repurchase Right shall terminate with respect to any Vested Share for which it has not been timely exercised pursuant to this paragraph 1.

 

For clarification purpose, the payment referred to in the preceding paragraph shall be deemed to have been effected if the consideration (as provided for under Clause 6.2) has been made available to the Grantee and so notified the Grantee in writing and the Grantee fails to collect such payment within seven (7) dates from such notification.

 

2.                             Additional Shares or Substituted Securities

 

In the event of the declaration of a stock dividend, the declaration of an extraordinary dividend payable in a form other than stock, a spin-off, a stock split, an adjustment in conversion ratio, a recapitalization or a similar transaction affecting the Company’s outstanding securities without receipt of consideration, any new, substituted or additional securities or other property (including money paid other than as an ordinary cash dividend) that by reason of such transaction are distributed with respect to any Vested Shares or into which such Vested Shares thereby become convertible shall also be subject to the Repurchase Rights.

 

3.                             Termination of Rights as Shareholder

 

If the Company makes available, at the time and place and in the amount and form provided in this Agreement, the consideration (as provided for in Clause 6.2) for the Vested Shares to be repurchased in accordance herewith, then after such time the Grantee shall no longer have any rights (either legal or beneficial) as a holder of such Vested Shares (other than the right to receive payment of such consideration in accordance with this Agreement).  Such Vested Shares shall be deemed to have been repurchased in accordance with the applicable provisions hereof, whether or not the certificate(s) therefor have been delivered to the Company.

 

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QIHOO 360  TECHNOLOGY CO. LTD.

COMPLEMENTARY RULES OF THE EMPLOYEE SHARE VESTING SCHEME

(2008)

 

1.1                               REPURCHASE OF VESTED SHARES

 

According to the Employee Share Vesting Scheme,  Qihoo 360 Technology Co. Ltd. (the “Company”) has the right to repurchase all the shares held by the Grantee (as defined in the 2006 Employee Share Vesting Scheme) under the following circumstances:

 

(a)  the Grantee’s employment with the Company is terminated on or before the second(2th) anniversary of his Date of Commencement, all the Shares already vested on him will be subject to the repurchase by the Company at an aggregate repurchase price of RMB1.00 and the Grantee shall not have any claim whatsoever against the Company and/or its nominee in respect of such repurchase;

 

(b)  the Grantee’s employment with the Company is terminated after the second (2th) anniversary but on or before the fourth(4th) anniversary of his Date of Commencement, 50% of all the Shares already vested on him will be subject to the repurchase by the Company at an aggregate repurchase price of RMB1.00 and the Grantee shall not have any claim whatsoever against the Company and/or its nominee in respect of such repurchase, PROVIDED that if the employment of such Grantee with the Company is terminated as a result of (i) the Grantee’s theft, conversion, or embezzlement of any asset or property of the Company; (ii) the Grantee being convicted of any criminal offence involving dishonesty or punishable with six (6) months or more imprisonment; or (iii) the Grantee’s material breach of any provision contained in his employment contract with the Company, all the Shares already vested on him will be subject to the repurchase by the Company at an aggregate repurchase price of RMB1.00; or

 

(c) the Grantee’s employment with the Company is terminated after the fourth(4th) anniversary of his Date of Commencement, no Shares already vested on him shall be repurchased by the Company, PROVIDED that if the employment of such Grantee with the Company is terminated as a result of (i) the Grantee’s theft, conversion, or embezzlement of any asset or property of the Company; or (ii) the Grantee’s material breach of any provision contained in his employment contract with the Company, all the Shares already vested on him will be subject to the repurchase by the Company at an aggregate repurchase price of RMB1.00.

 

1.2                               EXERCISE OF REPURCHASE RIGHT

 

According to the 2006 Employee Share Vesting Scheme, the repurchase by the Company shall be effected within ninety (90) days after the cessation date of the Grantee’s employment with the Company. The payment shall be made in cash or cash equivalents or by cancelling indebtedness to the Company incurred by the Grantee. The repurchase right shall be terminated after ninety (90) days after the cessation date of the Grantee’s employment with the Company.

 

The payment shall be deemed to have been effected if the consideration has been made available to the Grantee and so notified the Grantee in writing. If the Grantee fails to collect such payment within seven (7) dates from such notification, the payment shall be considered effective.

 

 

If the Company effectively exercises the repurchase right, all the Grantee’s rights in connection with the shares shall be terminated.

 

1.3                               RESTRICTION OF VESTED SHARES

 

The complementary rules of the 2006 Employee Share Vesting Scheme hereby provide that: all the employees who beneficially hold the shares of the Company, whether present or leaving, shall not damage the interest of the Company, otherwise the Company is entitled to repurchase 100% of all the shares they hold. With respect to the employees who leave the company but hold certain shares of the Company, the shares they hold shall be considered as the compensation paid by the Company for their leaving and subject to the restrictions in this clause. The following activities will be considered as making damages to the Company:

 

(i) within 24 months after the cessation date of the Grantee’s employment with the Company, the Grantee’s participated subsidiary, holding subsidiary or formed subsidiary, engages any employee of the Company and its affiliated companies.

 

(ii) within 24 months after the cessation date of the Grantee’s employment with the Company, the Grantee joins a company which has direct competition with the Company or its affiliated companies (including but not limited to Google, Baidu, Kingsoft, Rising, Jiangmin, Tencent, Xunlei, Baofeng and so on).

 

(iii) within 24 months after the cessation date of the Grantee’s employment with the Company, the Grantee participates, holds or forms any company which engages in search or Internet security business as a competitor to the Company and its affiliated companies;

 

(iv) the Grantee makes negative public announcement with respect to the Company and its management.

 

----------------END OF DOCUMENT-----------------

 

11Exhibit 10.3

 

EMPLOYMENT AGREEMENT

 

This EMPLOYMENT AGREEMENT (the “Agreement”), is entered into as of             , 2010 by and between Qihoo 360 Technology Co. Ltd., a company incorporated and existing under the laws of the Cayman Islands (the “Company”), and              , an individual (the “Executive”).  The term “Company” as used herein with respect to all obligations of the Executive hereunder shall be deemed to include the Company and all of its direct or indirect parent companies, subsidiaries, affiliates, or subsidiaries or affiliates of its parent companies (collectively, the “Group”).

 

RECITALS

 

A.            The Company desires to employ the Executive as its                and to assure itself of the services of the Executive during the term of Employment (as defined below).

 

B.            The Executive desires to be employed by the Company as its                during the term of Employment and upon the terms and conditions of this Agreement.

 

AGREEMENT

 

The parties hereto agree as follows:

 

1.                                      POSITION

 

The Executive hereby accepts a position of                of the Company (the “Employment”).

 

2.                                      TERM

 

Subject to the terms and conditions of this Agreement, the initial term of the Employment shall be         years, commencing on        , 2010 (the “Effective Date”), until        , 20        , unless terminated earlier pursuant to the terms of this Agreement.  Upon expiration of the initial         -year term, the Employment shall be automatically extended for successive [one]-year terms unless either party gives the other party hereto a one-month prior written notice to terminate the Employment prior to the expiration of such [one]-year term or unless terminated earlier pursuant to the terms of this Agreement.

 

3.                                      LOCATION

 

The Executive’s place of employment shall be the Company’s principal executive offices are currently located at Block 1, Area D, Huitong Times Plaza, No.71 JianGuo Road, Chao Yang District, Beijing 100025, People’s Republic of China.  [The Executive’s principal place of employment shall be the Company’s principal executive offices.] / [The Executive agrees that he will be regularly present at the Company’s principal executive

 

 

offices.]  The Executive acknowledges that he may be required to travel from time to time in the course of performing his duties for the Company.

 

4.                                      PROBATION

 

No probationary period.

 

5.                                      DUTIES AND RESPONSIBILITIES

 

The Executive’s duties at the Company will include all jobs assigned by the Company’s Board of Directors (the “Board”) and/or the         of the Company.

 

The Executive shall devote all of his working time, attention and skills to the performance of his duties at the Company and shall faithfully and diligently serve the Company  in accordance with this Agreement, the Memorandum and Articles of Association of the Company (the “Articles of Association”), and the guidelines, policies and procedures of the Company approved from time to time by the Board.

 

The Executive shall use his best efforts to perform his duties hereunder.  The Executive shall not hold any other employment, and shall not be concerned or interested in any business or entity that directly or indirectly competes with the Group (any such business or entity, a “Competitor”), provided that nothing in this clause shall preclude the Executive from holding up to [       % of] or       ] shares or other securities of any Competitor that is listed on any securities exchange or recognized securities market anywhere, provided however, that the Executive shall notify the Company in writing prior to his obtaining a proposed interest in such shares or securities in a timely manner and with such details and particulars as the Company may reasonably require.  The Company shall have the right to require the Executive to resign from any board or similar body which he may then serve if the Board reasonably determines in writing that the Executive’s service on such board or body interferes with the effective discharge of the Executive’s duties and responsibilities to the Company or that any business related to such service is then in competition with any business of the Company or any of its subsidiaries or affiliates.

 

6.                                      NO BREACH OF CONTRACT

 

The Executive hereby represents to the Company that: (i) the execution and delivery of this Agreement by the Executive and the performance by the Executive of the Executive’s duties hereunder shall not constitute a breach of, or otherwise contravene, the terms of any other agreement or policy to which the Executive is a party or otherwise bound, except for agreements that are required to be entered into by and between the Executive and any member of the Group pursuant to applicable law of the jurisdiction where the Executive is based, if any; (ii) that the Executive has no information (including, without limitation, confidential information and trade secrets) relating to any other person or entity which would prevent, or be violated by, the Executive entering into this Agreement or carrying out his duties hereunder; (iii) that the Executive is not bound by any confidentiality, trade secret or similar agreement (other than this) with any other person or entity except for other member(s) of the Group, as the case may be.

 

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7.                                      COMPENSATION AND BENEFITS

 

(a)                                  Cash Compensation.  The Executive’s salary shall be provided by the Company pursuant to Schedule A hereto, subject to annual review and adjustment by the Company.

 

(b)                                 Equity Incentives.  The Executive will be entitled to receive an option to purchase         ordinary shares of the Company, and upon such other terms as determined by the Board.

 

(c)                                  Benefits.  The Executive is eligible for participation in any standard employee benefit plan of the Company that currently exists or may be adopted by the Company in the future, including, but not limited to, any retirement plan, life insurance plan, health insurance plan and travel/holiday plan.

 

(d)                                 Pension.  The Executive is entitled to become a member of the Company’s mandatory provident fund scheme subject to the terms of its trust deed and rules in force from time to time. No additional voluntary contribution shall be made by the Company.  No withholdings shall be made by the Company other than the Executive’s mandatory contribution.

 

8.                                      TERMINATION OF THE AGREEMENT

 

(a)                                  By the Company.  The Company may terminate the Employment for cause, at any time, without notice or remuneration, if the Executive (1) commits any serious or persistent breach or non-observance of the terms and conditions of your employment; (2): is convicted of a criminal offence other than one which in the opinion of the Board does not affect the executive’s position as an employee of the Company, bearing in mind the nature of your duties and the capacity in which the executive is employed; (3) wilfully disobeys a lawful and reasonable order; (4) misconducts himself or herself such conduct being inconsistent with the due and faithful discharge of the executive’s duties; (5) is guilty of fraud or dishonesty; or (6) is habitually neglectful in his or her duties.  The company may terminate the Employment without cause, at any time, upon one month written notice or by payment of one month salary in lieu of notice.

 

(b)                                 By the Executive.  The Executive may terminate the Employment at any time with a [one]-month prior written notice to the Company or by payment of one month salary in lieu of notice.  In addition, the Executive may resign prior to the expiration of the Agreement if such resignation or an alternative arrangement with respect to the Employment is approved by the Board.

 

(c)                                  Notice of Termination.  Any termination of the Executive’s employment under this Agreement shall be communicated by written notice of termination from the terminating party to the other party.  The notice of termination shall indicate the specific provision(s) of this Agreement relied upon in effecting the termination.

 

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9.                                      CONFIDENTIALITY AND NONDISCLOSURE

 

(a)                                  Confidentiality and Non-disclosure. The Executive hereby agrees at all times during the term of his employment and after termination, to hold in the strictest confidence, and not to use, except for the benefit of the Group, or to disclose to any person, corporation or other entity without written consent of the Company, any Confidential Information. The Executive understands that “Confidential Information” means any proprietary or confidential information of the Group, its affiliates, their clients, customers or partners, and the Group’s licensors, including, without limitation, technical data, trade secrets, research and development information, product plans, services, customer lists and customers (including, but not limited to, customers of the Group on whom the Executive called or with whom the Executive became acquainted during the term of his employment), supplier lists and suppliers, software, developments, inventions, processes, formulas, technology, designs, drawings, engineering, hardware configuration information, personnel information, marketing, finances, information about the suppliers, joint ventures, licensors, licensees, distributors and other persons with whom the Group does business, information regarding the skills and compensation of other employees of the Group or other business information disclosed to the Executive by or obtained by the Executive from the Group, its affiliates, or their clients, customers or partners either directly or indirectly in writing, orally or by drawings or observation of parts or equipment, if specifically indicated to be confidential or reasonably expected to be confidential. Notwithstanding the foregoing, Confidential Information shall not include information that is generally available and known to the public through no fault of the Executive.

 

(b)                                 Company Property.  The Executive understands that all documents (including computer records, facsimile and e-mail) and materials created, received or transmitted in connection with his work or using the facilities of the Group are property of the Group and subject to inspection by the Group, at any time. Upon termination of the Executive’s employment with the Company (or at any other time when requested by the Company), the Executive will promptly deliver to the Company all documents and materials of any nature pertaining to his work with the Company and will provide written certification of his compliance with this Agreement. Under no circumstances will the Executive have, following his termination, in his possession any property of the Group, or any documents or materials or copies thereof containing any Confidential Information.

 

(c)                                 Former Employer Information.  The Executive agrees that he has not and will not, during the term of his employment, (i) improperly use or disclose any proprietary information or trade secrets of any former employer or other person or entity with which the Executive has an agreement or duty to keep in confidence information acquired by Executive, if any, or (ii) bring into the premises of the Group any document or confidential or proprietary information belonging to such former employer, person or entity unless consented to in writing by such former employer, person or entity.  The Executive will indemnify the Group and hold it

 

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harmless from and against all claims, liabilities, damages and expenses, including reasonable attorneys’ fees and costs of suit, arising out of or in connection with any violation of the foregoing.

 

(d)                                 Third Party Information.   The Executive recognizes that the Group may have received, and in the future may receive, from third parties their confidential or proprietary information subject to a duty on the Group’s part to maintain the confidentiality of such information and to use it only for certain limited purposes.  The Executive agrees that the Executive owes the Group and such third parties, during the Executive’s employment by the Company and thereafter, a duty to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person or firm and to use it in a manner consistent with, and for the limited purposes permitted by, the Group’s agreement with such third party.

 

This Section 9 shall survive the termination of this Agreement for any reason.  In the event the Executive breaches this Section 9, the Company shall have right to seek remedies permissible under applicable law.

 

10.                               INVENTIONS

 

(a)                                  Inventions Retained and Licensed.  The Executive has attached hereto, as Schedule B, a list describing all inventions, ideas, improvements, designs and discoveries, whether or not patentable and whether or not reduced to practice, original works of authorship and trade secrets made or conceived by or belonging to the Executive (whether made solely by the Executive or jointly with others) that (i) were developed by Executive prior to the Executive’s employment by the Company (collectively, “Prior Inventions”), (ii) relate to the Group’s actual or proposed business, products or research and development, and (iii) are not assigned to the Group hereunder; or, if no such list is attached, the Executive represents that there are no such Prior Inventions.  Except to the extent set forth in Schedule B, the Executive hereby acknowledges and represents that, if in the course of his service for the Group, the Executive incorporates into a Group product, process or machine a Prior Invention owned by the Executive or in which he has an interest, (a) the Group is hereby granted and shall have a nonexclusive, royalty-free, irrevocable, perpetual, worldwide right and license (which may be freely transferred by the Group to any other person or entity) to make, have made, modify, use, sell, sublicense and otherwise distribute such Prior Invention as part of or in connection with such product, process or machine, and (b) he has all necessary rights, powers and authorization to use such Prior Invention in the manner it is used and such use will not infringe any right of any company, entity or person.  The Executive hereby agrees to indemnify the Group and hold it harmless from all claims, liabilities, damages and expenses, including reasonable legal fees and costs for resolving disputes arising out of or in connection with any violation or claimed violation of a third party’s rights resulting from any use, sub-licensing, modification, transfer or sale by the Group of such Prior Invention.

 

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(b)                                 Disclosure and Assignment of Inventions.     The Executive understands that the Company engages in research and development and other activities in connection with its business and that, as an essential part of the Employment, the Executive is expected to make new contributions to and create inventions of value for the Company.

 

From and after the Effective Date, the Executive shall make full written disclosure in confidence to the Company all inventions, improvements, designs, original works of authorship, formulas, processes, compositions of matter, computer software programs, databases, mask works, concepts and trade secrets, whether or not patentable or registrable under patent, copyright, circuit layout design or similar laws in China or anywhere else in the world, which the Executive may solely or jointly conceive or develop or reduce to practice, or cause to be conceived or developed or reduced to practice, during the period of the Executive’s Employment at the Company (whether or not during business hours) that are either related to the scope of his Employment at the Company or make use, in any manner, of the resources of the Group (collectively, the “Inventions”).  The Executive hereby acknowledges that the Company or the Group shall be the sole owner of all rights, title and interest in the Inventions created hereunder. In the event the foregoing assignment of Inventions to the Company or the Group is ineffective for any reason, each member of the Group is hereby granted and shall have a royalty-free, sub-licensable, transferable, irrevocable, perpetual, worldwide license to make, have made, modify, use, and sell such Inventions as part of or in connection with any product, process or machine. Such exclusive license shall continue in effect for the maximum term as may now or hereafter be permissible under applicable law. Upon expiration, such license, without further consent or action on the Executive’s part, shall automatically be renewed for the maximum term as is then permissible under applicable law, unless, within the six-month period prior to such expiration, the Company and the Executive have agreed that such license will not be renewed. The Executive also hereby forever waives and agrees never to assert any and all rights he may have in or with respect to any Inventions even after termination of his employment with the Company. The Executive hereby further acknowledges that all Inventions created by him (solely or jointly with others) are, to the extent permitted by applicable law, “works made for hire” or “inventions made for hire,” as those terms are defined in the People’s Republic of China (“PRC”) Copyright Law, the PRC Patent Law and the Regulations on Computer Software Protection, respectively, and all titles, rights and interests in or to such Inventions are or shall be vested in the Company.

 

(c)                                  Patent and Copyright Registration.  The Executive agrees to assist the Company or its designees in every proper way to obtain for the Company and enforce patents, copyrights, mask work rights, trade secret rights, and other legal protection for the Inventions in any and all countries.  The Executive will execute any documents that the Company may reasonably request for use in obtaining or enforcing such patents, copyrights, mask work rights, trade secrets and other legal protections.  The Executive’s obligations under this paragraph will continue

 

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beyond the termination of the Employment with the Company, provided that the Company will reasonably compensate the Executive after such termination for time or expenses actually spent by the Executive at the Company’s request on such assistance.  The Executive appoints the Company and its duly authorized officers and agents as the Executive’s attorney-in-fact to execute documents on the Executive’s behalf for this purpose.

 

(d)                                 Remuneration.  The Executive hereby agrees that the remuneration received by the Executive pursuant to this Agreement with the Company includes any remuneration which the Executive may be entitled to under applicable PRC law for any “works made for hire,” “inventions made for hire” or other Inventions assigned to the Company pursuant to this Agreement.

 

(e)                                  Return of Confidential Material.  In the event of the Executive’s termination of employment with the Company for any reason whatsoever, Executive agrees promptly to surrender and deliver to the Company all records, materials, equipment, drawings, documents and data of any nature pertaining to any confidential information or to his employment, and Executive will not retain or take with him any tangible materials or electronically stored data, containing or pertaining to any confidential information that Executive may produce, acquire or obtain access to during the course of his employment.

 

This Section 10 shall survive the termination of this Agreement for any reason.  In the event the Executive breaches this Section 10, the Company shall have right to seek remedies permissible under applicable law.

 

11.                               CONFLICTING EMPLOYMENT

 

The Executive hereby agrees that, during the term of his employment with the Company, he will not engage in any other employment, occupation, consulting or other business activity related to the business in which the Group is now involved or becomes involved during the term of the Executive’s employment, nor will the Executive engage in any other activities that conflict with his obligations to the Company without the prior written consent of the Company.

 

12.                               NON-COMPETITION AND NON-SOLICITATION

 

In consideration of the salary paid to the Executive by the Company, the Executive undertakes that for a period of [one (1)] year after he ceases to be employed by the Company, he will not, without the prior written consent of the Company:

 

(a)                                  in the territory of the PRC (for the purpose of this Section 12, the PRC shall include Hong Kong, Macau and Taiwan) (the “Territory”), either on his own account or through any of his affiliates, or in conjunction with or on behalf of any other person, carry on or be engaged, concerned or interested directly or indirectly whether as shareholder, director, employee, partner, agent or otherwise carry on any business in direct competition with the business of the Group;

 

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(b)                                 either on his own account or through any of his affiliates or in conjunction with or on behalf of any other person, solicit or entice away or attempt to solicit or entice away from the Group, any person, firm, company or organization who is or shall at any time within [two (2)] years prior to such cessation have been a customer, client, representative or agent of the Group or in the habit of dealing with the Group;

 

(c)                                  either on his own account or through any of his affiliates or in conjunction with or on behalf of any other person, employ, solicit or entice away or attempt to employ, solicit or entice away from the Group any person who is or shall have been at the date of or within twelve (12) months prior to such cessation of employment an officer, manager, consultant or employee of any such the Group whether or not such person would commit a breach of contract by reason of leaving such employment; or

 

(d)                                 either on his own account or through any of his affiliates or in conjunction with or on behalf of any other person, in relation to any trade, business or company use a name including the words [“Qihoo, “360,” “        ”] or any other words hereafter used by the Group in its name or in the name of any of its products, services or their derivative terms, or the Chinese or English equivalent or any similar word in such a way as to be capable of or likely to be confused with the name of the Group or the product or services or any other products or services of the Group, and shall use all reasonable endeavors to procure that no such name shall be used by any of his affiliates or otherwise by any person with which he is connected.

 

Each and every obligation under Section 12 shall be treated as a separate obligation and shall be severally enforceable as such and in the event of any obligation or obligations being or becoming unenforceable in whole or in part, such part or parts which are unenforceable shall be deleted from such section and any such deletion shall not affect the enforceability of the remainder parts of such section.

 

The Executive agrees that in light of the circumstances, the restrictive covenants contained in Section 12 are reasonable and necessary for the protection of the Group, and further agrees that having regard to those circumstances the said covenants and are not excessive or unduly onerous upon the Executive.  However, it is recognized that restrictions of the nature in question may fail for technical reasons currently unforeseen and accordingly it is hereby agreed and declared that if any of such restrictions shall be adjudged to be void as going beyond what is reasonable, in light of the circumstances, for the protection of the Group, but would be valid if part of the wording thereof were deleted or the periods thereof reduced or the range of activities or area dealt with thereby reduced in scope, the said restriction shall apply with such modification as may be necessary to make it valid and effective.

 

This Section 12 shall survive the termination of this Agreement for any reason.  In the event the Executive breaches this Section 12, the Executive acknowledges that there will be no adequate remedy at law, and the Company shall be entitled to injunctive relief and/or a decree for specific performance, and such other relief as may be proper

 

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(including monetary damages if appropriate).  In any event, the Company shall have right to seek all remedies permissible under applicable law.

 

13.                               NOTIFICATION OF NEW EMPLOYER

 

In the event that the Executive leaves the employ of the Company,  the Executive hereby grants consent to notification by the Company to his or her new employer about his or her rights and obligations under this Agreement.

 

14.                               ASSIGNMENT

 

This Agreement is personal in its nature and neither of the parties hereto shall, without the consent of the other, assign or transfer this Agreement or any rights or obligations hereunder; provided, however, that (i) the Company may assign or transfer this Agreement or any rights or obligations hereunder to any member of the Group without such consent, and (ii) in the event of a merger, consolidation, or transfer or sale of all or substantially all of the assets of the company with or to any other individual(s) or entity, this Agreement shall, subject to the provisions hereof, be binding upon and inure to the benefit of such successor and such successor shall discharge and perform all the promises, covenants, duties, and obligations of the Company hereunder.

 

15.                               SEVERABILITY

 

If any provision of this Agreement or the application thereof is held invalid, the invalidity shall not affect other provisions or applications of this Agreement which can be given effect without the invalid provisions or applications and to this end the provisions of this Agreement are declared to be severable.

 

16.                               ENTIRE AGREEMENT

 

This Agreement constitutes the entire agreement and understanding between the Executive and the Company regarding the terms of the Employment and supersedes all prior or contemporaneous oral or written agreements concerning such subject matter.  The Executive acknowledges that he has not entered into this  Agreement in reliance upon any representation, warranty or undertaking which is not set forth in this Agreement.  Any amendment to this Agreement must be in writing and signed by the Executive and the Company.

 

17.                               REPRESENTATIONS

 

The Executive hereby agrees to execute any proper oath or verify any proper document required to carry out the terms of this Agreement. The Executive hereby represents that the Executive’s performance of all the terms of this Agreement will not breach any agreement to keep in confidence proprietary information acquired by the Executive in confidence or in trust prior to his or her employment by the Company. The Executive has not entered into, and hereby agrees that he or she will not enter into, any oral or written agreement in conflict with this Section 17.

 

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18.                               GOVERNING LAW

 

This Agreement shall be governed by and construed in accordance with the law of New York.

 

19.                               AMENDMENT

 

This Agreement may not be amended, modified or changed (in whole or in part), except by a formal, definitive written agreement expressly referring to this Agreement, which agreement is executed by both of the parties hereto.

 

20.                               WAIVER

 

Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence.  No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver.

 

21.                               NOTICES

 

All notices, requests, demands and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given and made if (i) delivered by hand, (ii) otherwise delivered against receipt therefor, or (iii) sent by a recognized courier with next-day or second-day delivery to the last known address of the other party.

 

22.                               COUNTERPARTS

 

This Agreement may be executed in any number of counterparts, each of which shall be deemed an original as against any party whose signature appears thereon, and all of which together shall constitute one and the same instrument.  This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories.  Photographic copies of such signed counterparts may be used in lieu of the originals for any purpose.

 

23.                               NO INTERPRETATION AGAINST DRAFTER

 

Each party recognizes that this Agreement is a legally binding contract and acknowledges that he has had the opportunity to consult with legal counsel of choice.  In any construction of the terms of this Agreement, the same shall not be construed against either party on the basis of that party being the drafter of such terms.  The Executive agrees and acknowledges that he has read and understands this Agreement, is entering

 

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into it freely and voluntarily, and has been advised to seek counsel prior to entering into this Agreement and has ample opportunity to do so.

 

[Remainder of this page intentionally has been intentionally left blank.]

 

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IN WITNESS WHEREOF, this Agreement has been executed as of the date first written above.

 

 

	
Qihoo 360 Technology Co. Ltd.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
Name:
    	
 
    
	
Title:
    	
 
    
			

 

 

Signature Page to Employment Agreement

 

 

Executive

 

 

	
Signature:
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    

 

 

Signature Page to Employment Agreement

 

 

Schedule A

 

Cash Compensation

 

 

	
 
    	
 
    	
Amount
    	
 
    	
Pay Period
    	
 
    
	
Salary
    	
 
    	
[RMB]         annually
    	
 
    	
[RMB]         to be paid   monthly
    	
 
    

 

 

Schedule B

 

List of Prior Inventions

 

	
Title
    	
 
    	
Date
    	
 
    	
Identifying Number
   or Brief Description
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

 

	
              No inventions or improvements
    	
 
    
	
              Additional   Sheets Attached
    	
 
    
	
Signature   of Executive:
    	
 
    	
 
    
	
Print   Name of Executive:
    	
 
    	
 
    
	
Date:

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