UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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Sohu.com Inc.
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April 27, 2017 | ||||||
Dear Sohu.com Stockholders: |
Sincerely, | ||||||
Charles Zhang |
____________________
TO BE HELD on JuneON JUNE 20, 20142017
10:00 A.M. BEIJING TIME
1) | To elect |
2) | To vote on an advisory resolution approving our executive compensation; |
3) | To make an advisory vote on the frequency of future advisory votes on our executive compensation; |
4) | To ratify the appointment of PricewaterhouseCoopers Zhong Tian LLP as our independent auditors for the fiscal year ending December 31, |
5) | To consider and act upon all other matters which may properly come before the Annual Meeting or any adjournment or postponement thereof. |
By order of the Board of Directors, | ||||||
/s/ Timothy B. Bancroft | ||||||
Timothy B. Bancroft | ||||||
Secretary |
FOR the ratification of the appointment of PricewaterhouseCoopers Zhong Tian LLP (“PricewaterhouseCoopers”) as our independent auditors for the fiscal year ending December 31, 2014; and
By-laws, the presence in person or by proxy of a majority of the shares of our common stock outstanding on the record date is required for a quorum. Abstentions and broker non-votes are each included for purposes of determining the presence or absence of a sufficient number of shares to constitute a quorum for the transaction of business. With respect to the approval of any particular proposal, abstentions and broker non-votes are not counted in determining the number of votes cast. The election of directors requires a plurality of the votes cast in person or by proxy. The nominees receiving the highest number of affirmative votes of the shares present or represented and voting on the election of the directors at the Annual Meeting will be elected as directors. In voting on the advisory resolution approving our executive compensation, stockholders may vote in favor of the proposal or against the proposal, or abstain from voting. This matter will be decided by the affirmative vote of the holders of a majority of the shares of our common stock that are present in person or by proxy at the Annual Meeting.Meeting and entitled to vote thereon. In the advisory vote on the frequency of future advisory votes on our executive compensation, stockholders may vote to have an advisory vote on executive compensation every one, two or three years, or abstain from voting. The number of years that receives a plurality of the votes cast will be considered the period approved by the stockholders. The result of the advisory vote approving our executive compensation and the advisory vote on the frequency of future advisory votes on our executive compensation will not be binding on us or our Board. Our Board and Compensation Committee will review the voting result and take it into consideration when making future decisions regarding executive compensation and decisions regarding the frequency of future advisory votes on our executive compensation. The ratification of the appointment of PricewaterhouseCoopers as our independent auditors requires the affirmative vote of the holders of a majority of the shares of our common stock that are present in person or by proxy at the Annual Meeting. In voting on the stockholder proposal regarding the position of Chairman of the Board, if the proposal is properly presented at the Annual Meeting stockholders mayand entitled to vote in favor of the proposal or against the proposal, or abstain from voting. This matter will be decided by the affirmative vote of the holders of a majority of the shares of our common stock that are present in person or by proxy at the Annual Meeting. The result of a vote on the stockholder proposal regarding the position of Chairman of the Board will not be binding on us or our Board. Our Board will review the voting result and may take it into consideration when making future decisions regarding the position of Chairman of the Board.
Name, Age, Positions and Offices with Sohu.com Inc. | Principal Occupation, Business Experience and Directorships held with Other Public Corporations during the past Five Years | Term of Office as Director | |||||||||||||
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Education Holdings Ltd. 47 years old. | Mr. Charles Huang is the Founder, Chief Executive Officer and Chairman of Netbig Education Holdings Ltd. (“Netbig”), a leading education enterprise in China. Prior to founding Netbig in 1999, Mr. Charles Huang served as Executive Director and Head of the Asia Securitization Group of Deutsche Bank, New York and Hong Kong, as well as a Senior Vice President of Prudential Securities Inc., New York. He holds a Master of Science degree in Computer Science from Mr. Charles Huang also serves as director of ZTO Express (Cayman) Inc (New York Stock Exchange). We believe Mr. Charles Huang’s qualifications to serve on our Board include his (i) qualification as a Chartered Financial Analyst and related experience in senior positions in the corporate finance industry in the U.S. and Asia, (ii) academic credentials and experience in the computer industry, (iii) status and track record as a successful entrepreneur and (iv) extensive experience managing an Internet company. | Mr. Charles Huang’s term expires at the |
Name, Age, Positions and Offices with Sohu.com Inc. | Principal Occupation, Business Experience and Directorships held with Other Public Corporations during the past Five Years | Term of Office as Director | |||||||||||||
Dr. Dave Qi 53 years old. | Dr. Dave Qi is a Professor of Accounting and the former Associate Dean of the Cheung Kong Graduate School of Business. He began teaching at the Cheung Kong Graduate School of Business in 2002 and was the founding Director of the Executive MBA program. Before joining the Cheung Kong Graduate School of Business, Dr. Dave Qi was an Associate Professor at the School of Accounting of the Chinese University of Hong Kong. Dr. Dave Qi has published many articles and research essays on accounting, financial reporting, capital market and other related topics. He has a Ph.D. in accounting from the Eli Broad Graduate School of management of Michigan State University, a Master of Business Administration from the University of Hawaii at Manoa and a Bachelor of Science and a Bachelor of Arts degree from Fudan University. Dr. Dave Qi is currently a member of the American Accounting Association. Dr. Dave Qi also serves as director of the following public companies: We believe Dr. Dave Qi’s qualifications to serve on our Board include his (i) strong academic credentials and working experience with accounting and finance in general, and with accounting and finance in China in particular, (ii) status as former associate Dean of one of the | Dr. Dave Qi’s term expires at the |
Name, Age, Positions and Offices with Sohu.com Inc. | Principal Occupation, Business Experience and Directorships held with Other Public Corporations during the past Five Years | Term of Office as Director | ||||||
Mr. Shi Wang 66 years old. | Mr. Shi Wang is the Chairman of the Board of Directors of Vanke, of which he also served as General Manager from 1991 to 1999. In 1984 Mr. Shi Wang founded the Shenzhen Exhibition Center of Modern Science and Education Equipment, We believe Mr. Shi Wang’s qualifications to serve on our Board include (i) history as the founder of Vanke, a | Mr. Shi Wang’s term | ||||||
Dr. Charles Zhang 52 years old. | Dr. Charles Zhang is our founder and has been Chairman of our Board and Chief Executive Officer since August 1996. Dr. Charles Zhang also served as our President from August 1996 to July 2004. Prior to founding Sohu.com Inc., Dr. Charles Zhang worked for Internet Securities Inc. and helped to establish its China operations. Prior to that, Dr. Charles Zhang worked as MIT’s liaison officer with China. Dr. Charles Zhang has a Ph.D. in experimental physics from MIT and a Bachelor of Science degree from Tsinghua University in Beijing. Dr. Charles Zhang is a native of the People’s Republic of China. Dr. Charles Zhang is also the Chairman of the Board of Changyou.com Limited, our independently-listed majority-owned subsidiary. We believe Dr. Charles Zhang’s qualifications to serve on our Board include his (i) position as our Chief Executive Officer, (ii) history as the founder of our company and status as one of the best-known and most successful entrepreneurs in China, (iii) general reputation and track record as an innovator, visionary and early mover in the Internet industry in China and (iv) deep understanding of the Chinese Internet industry. | Dr. Charles Zhang’s term expires at the 2018 Annual Meeting. |
Positions and Offices with Sohu.com Inc. | Principal Occupation, Business Experience and Directorships held with Other Public Corporations during the past Five Years | Term of Office as Director | ||
Dr. Zhonghan Deng 49 years old. | Dr. Zhonghan Deng is the Chief Executive Officer and Chairman of the Board of Directors of Vimicro International Corporation (“Vimicro”), which he co-founded in 1999. Dr. Zhonghan Deng received a Ph.D. in electrical engineering and computer sciences, a Master of Science degree in economics and a Master of Science degree in physics from the University of California, Berkeley. After graduating from Berkeley, Dr. Zhonghan Deng worked as a research scientist for International Business Machines Corporation at the T.J. Watson Research Center in Yorktown Heights, New York. We believe Dr. Zhonghan Deng’s qualifications to serve on our Board include (i) academic credentials and experience in the computer industry, (ii) history as the founder of Vimicro, a company that was listed on NASDAQ until its recent going-private transaction, (iii) status and track record as a successful entrepreneur in China, and (iv) extensive experience managing a company that was listed on NASDAQ. | Dr. Zhonghan Deng’s term expires at the 2018 Annual Meeting. |
Name, Age, Positions and Offices with Sohu.com Inc. | Principal Occupation, Business Experience and Directorships held with Other Public Corporations during the past Five Years | Term of Office as Director | ||
Mr. Dave De Yang 51 years old. | Mr. Dave De Yang became a Partner in and the Chief Financial Officer of Dalton International, a private equity firm based in Chicago, in 2017. From 2012 through 2016, Mr. Yang served as Chief Financial Officer for the North Asia region, including China, Hong Kong, Taiwan, Japan, and Korea, of Reckitt Benckiser, a London-based company that is listed on the London Stock Exchange and is included in the FTSE 100 Index. Prior to joining Reckitt Benckiser, Mr. Yang worked for McDonald’s Corporation as a senior financial director, including an international assignment as the Corporate Controller of McDonald’s China for three and half years. Prior to that role, he served as acting controller of McDonald’s India and Indonesia divisions and as a senior director of McDonald’s Corporation in the Asia Pacific, Middle East and Africa division, where he oversaw the development and supervision of financial strategy and policy. Prior to joining McDonald’s Corporation, Mr. Yang worked in the U.S. business unit of Ernst & Young LLP for seven years in various positions, including as a group manager. During Mr. Yang’s tenure at Ernst & Young LLP, he focused on business risk management consultation, corporate M&A, restructuring of corporate internal management processes, internal audits, risk assessment, control system designs, and auditing of corporate financial statements, primarily for Fortune 500 companies. Mr. Yang has a master of business administration degree from the City University of New York, a master’s degree in Management and Engineering from the Graduate School of the Chinese Academy of Sciences in Beijing, and a bachelor’s degree in physics from the University of Science and Technology of China. Mr. Yang is a member of the U.S. Institute of Certified Internal Auditors, the Institute of Certified Public Accountants and the Institute of Certified Management Accountants. Mr. Yang has served as a member of the Board of Directors and of the Audit Committee of our majority-owned subsidiary Changyou.com Limited since 2009. We believe Mr. Dave De Yang’s qualifications to serve on our Board include his (i) extensive background and experience in senior financial and accounting management positions, including at Reckitt Benckiser, McDonald’s, and Ernst & Young, (ii) positions as a member of the Board of Directors and of the Audit Committee of our Nasdaq-listed subsidiary Changyou.com Limited, and (iii) educational and professional degrees and credentials in management, finance, accounting, and physics. | Mr. Dave De Yang’s term expires at the 2018 Annual Meeting. |
(1) | member of our Audit Committee |
(2) | member of our Compensation Committee |
(3) | member of our Nominating Committee |
There werehave been no material changes to suchin our Nominating Committee’s procedures after wefor selecting director candidates since our last provided this disclosure.annual meeting of stockholders. The committeeNominating Committee does not intend to alter the manner in which it evaluates candidates, including the criteria set forth above, based on whether the candidate was recommended by a stockholder or otherwise.
We have appropriate weighting of long-term incentive compensation; |
goals are appropriately set to avoid targets that, if not achieved, result in a large percentage loss of compensation; |
we do not rely on hard targets that can only be evaluated with reference to numerical results, so as to minimize the risk of our executives’ focusing excessively on short-term results; and |
we have a limit on the total amount of compensation that can be paid to each executive, which helps reduce the risk of our executives’ pursuing achievement of |
Amount and Nature of | |||||||||||
Name and Address of Beneficial Owner | Beneficial Ownership(1) | Percent of Class(1) | |||||||||
Charles Zhang | 7,916,520 | (2) | 20.30 | % | |||||||
Charles Huang(3) | 76,265 | * | |||||||||
Xiaochuan Wang(4) | 53,858 | * | |||||||||
Shi Wang(5) | 34,132 | * | |||||||||
Dave Qi(6) | 28,940 | * | |||||||||
Zhonghan Deng(7) | 15,549 | * | |||||||||
Joanna Lv | 5,500 | (8) | * | ||||||||
Dave De Yang(9) | — | — | |||||||||
Dewen Chen(10) | — | — | |||||||||
Carol Yu | 62,500 | (11) | * | ||||||||
All directors, nominees and executive officers as a group (9 persons) | 8,193,264 | (12) | 21.01 | % | |||||||
Photon Group Limited(13) | 7,722,820 | 19.88 | % | ||||||||
Orbis Investment Management Ltd. | 6,696,218 | (14) | 17.29 | % | |||||||
Delaware Management Business Trust | 3,983,588 | (15) | 10.28 | % |
Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership(1) | Percent of Class(1) | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Charles Zhang | 7,745,479 | (2) | 20.12 | % | ||||||
Edward Roberts | 300,920 | (3) | * | |||||||
Charles Huang | 70,387 | (4) | * | |||||||
Xiaochuan Wang | 38,858 | (5) | * | |||||||
Carol Yu | 35,000 | (6) | * | |||||||
Dave Qi | 22,261 | (7) | * | |||||||
Shi Wang | 31,387 | (8) | * | |||||||
Zhonghan Deng | 9,671 | (9) | * | |||||||
All directors, nominees and executive officers as a group (8 persons) | 8,248,963 | (10) | 21.40 | % | ||||||
Photon Group Limited | 7,028,254 | (11) | 18.27 | % | ||||||
Orbis Investment Management Ltd. | 6,245,827 | (12) | 16.24 | % | ||||||
Delaware Management Business Trust | 2,776,876 | (13) | 7.22 | % | ||||||
Platinum Asset Management Ltd. | 2,752,963 | (14) | 7.16 | % |
* | Less than 1%. |
(1) | Includes the number of shares and percentage ownership represented by such shares determined to be beneficially owned by a person in accordance with the rules of the SEC. The number of shares beneficially owned by a person includes shares of common stock subject to options or restricted stock units held by that person that are currently exercisable or |
(2) | Includes (i) |
(3) |
(4) | Mr. Xiaochuan Wang’s address is c/o |
(5) | Mr. Shi Wang’s address is Vanke Architecture Research Center, No. 68 Meilin Road, Futian District, Shenzhen 518049, People’s Republic of China. | |
(6) | Dr. Dave Qi’s address is 63 Saabee Lase, Discovery Bay, Hong Kong. | |
(7) | Dr. Zhonghan Deng’s address is 16/F, Shining Tower, No. 35, Xueyuan Road, Haidian District, Beijing 100191, People’s Republic of China. | |
(8) | Includes 2,500 shares of our common stock subject to options exercisable within 60 days of April 14, 2017. Ms. |
Mr. Dave | |||
(10) | Mr. Dewen Chen’s address is c/o | ||
(11) | Ms. Yu resigned as our President and Chief Financial Officer effective July 31, 2016. |
Includes |
(13) | Photon Group Limited’s address is c/o Sohu.com Inc., Sohu.com Media Plaza, Block 3, No. 2 Kexueyuan South Road, Haidian District, Beijing 100190, People’s Republic of China. |
(14) | Data based on a Schedule 13G/A filed with the SEC on February 14, 2017. Orbis Investment Management |
(15) | Data based on a Schedule 13G/A filed with the SEC on February 14, 2017. Delaware Management Business Trust’s address is 2005 Market Street, Philadelphia, PA 19103. |
the nature of the related person’s interest in the transaction; |
the material terms of the transaction, including, without limitation, the amount and type of transaction; |
the importance of the transaction to the related person and to us; |
whether the transaction would impair the judgment of any of our directors or executive officers to act in our best interest; |
whether the terms of the transaction are substantially equal to or more favorable to us and no more favorable to the related person than if we had negotiated similar arrangements with non-affiliated third parties; and |
any other matters our Audit Committee deems appropriate. |
received the written disclosures and the letter from the independent auditors required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent auditors’ communications with the Audit Committee concerning independence; |
discussed with the independent auditors the independent auditors’ independence; and |
discussed with the independent auditors the matters required to be discussed |
Respectfully submitted, | ||||||
AUDIT COMMITTEE | ||||||
Dr. Dave Qi | ||||||
Dr. Zhonghan Deng | ||||||
Mr. Dave De Yang |
Xiaochuan Wang,age 39, has been the Chief Executive Officer of Sogou since 2010, and was named as one of our executive officers effective November 1, 2016. Under his leadership, Sogou has developed many strategic products, including the Sogou Search Engine, the Sogou Pinyin Input Method and the Sogou Browser. From 2010 to 2013, Mr. Wang also served as our Chief FinancialTechnology Officer. From March 1995 until November 2000, Ms. Carol Yu served as Senior Vice-President Investment Banking of Donaldson Lufkin & Jenrette Securities Corporation in Hong Kong. Ms. Carol Yu also worked with Arthur Andersen Hong Kong and Beijing for ten years and was a partner of the Audit Division, holding the position of General Manager of Arthur Andersen-Hua Qiang, the joint venture accounting firm formed between Arthur Andersen and the Ministry of Finance in China.
Dewen Chen,age 41, is the Chief Executive Officer of Changyou and Commercialwas one of the principal founders of Changyou’s online game business. Mr. Chen was named as one of our executive officers effective November 1, 2016. Mr. Chen joined us in 2005 as a business manager, responsible for building a sales team for game products. Beginning in May 2006, Mr. Chen was in charge of the overall marketing, promotion, sales and channel distribution of our game products. Prior to Changyou’s carve-out from us in 2007, Mr. Chen was the Director of Marketing & Operations of our online game business. From April 2000 until he joined us in 2005, Mr. Chen worked at Shanghai Hua Teng Software System Co. Ltd. as a pre-sale technology consultant and sales manager. Prior to that, Mr. Chen worked with Fujian Shi Da Computer Group as a software engineer and project manager, and later as the Director of the Technology Department of the Shanghai branch office. Mr. Dewen Chen received a bachelor’s degree in Computer Engineering from Xi’an Jiaotong University.
Our executive compensation program for 2016, which was reviewed, and recommended to our Board of Directors for approval, by our Compensation Committee and was approved by our Board of Directors in August 2016, applied only to our Chief Executive Officer Dr. Charles Zhang. See “2016 Executive Compensation Program for Dr. Charles Zhang.”
Prior to July 31, 2016, Ms. Joanna Lv was our Senior Finance Director, reporting to Ms. Carol Yu, who was our President and Chief Financial Officer. Ms. Lv’s initial compensation package for 2016, which was reviewed and approved by Ms. Yu, consisted of a mix of base salary, performance-based cash bonus and allowances. Ms. Lv’s compensation mix for 2016 remained unchanged after she became our Acting Chief Financial Officer on July 31, 2016, except that our Board of Directors approved an increase in her performance-based cash bonus due to her increased level of responsibility. See “Compensation for Ms. Joanna Lv in 2016.”
Mr. Xiaochuan Wang’s compensation package for 2016 was designed and implemented by Sogou. Mr. Wang’s compensation package for 2016 remained unchanged after our Board named Mr. Wang as one of our executive officers effective November 1, 2016. See “Compensation for Mr. Xiaochuan Wang in 2016.”
Mr. Dewen Chen’s compensation package for 2016 was designed and implemented by Changyou. Mr. Chen’s compensation package for 2016 remained unchanged after our Board named Mr. Chen as one of our executive officers effective November 1, 2016. See “Compensation for Mr. Dewen Chen in 2016.”
Our Executive Pay Philosophy
Attract and retain executives who will significantly contribute to the creation of value for our stockholders; |
Pay compensation that is competitive in comparison to that paid by others in our industry; |
Effectively make use of our cash and available equity incentives by determining appropriate cash salary and bonus and equity award components in view of each executive’s position and responsibility level in our company, individual performance, skills, competency, experience, and contribution to our realization of our performance goals as a company; and |
Rationally and fairly pay performance-based compensation through a combination of financial performance reviews and non-quantitative evaluations, in order to help ensure transparency in our executive compensation decisions. |
the competitiveness of the total compensation |
the level of responsibility of |
the skills, competency, and past work experience of |
Base salary. We aim to offer pay at a level that is sufficiently competitive to attract and retain experienced and successful executives. We |
Annual cash incentive. We offer an annual cash bonus incentive to encourage and reward contributions to our annual financial performance |
of 200% (i.e., a maximum annual cash bonus equal to 200% of his annual base salaries for 2016), to encourage |
Long-term incentives. Long-term incentives are designed to encourage and reward building long-term stockholder value and to retain our executive officers. We provide a mix of stock options and |
consideration of pay-for-performance, in order to align compensation with our business objectives and performance; |
consideration of the state of the market for executive talent, in order to position Sohu competitively among the companies against which we recruit and compete for talent, in order to enable us to attract, retain, and reward executive officers; and |
the availability of relevant data from the companies selected. |
Based on these criteria the Hay Group recommended three categories of peer group, consisting of:Peer Group 1: Listed US companies in high-tech/media or related industries
Activision Blizzard, Inc. | Linkedin Corporation | |||||
Adobe Systems Inc. | Microsoft Corp. | |||||
Amazon.com, Inc. | NetApp, Inc. | |||||
Netflix, Inc. | ||||||
Apple Inc. | News Corp. | |||||
Oracle Corp. | ||||||
Blucora Inc. | Qualcomm, Inc. | |||||
Salesforce.com Inc | ||||||
Demand Media Inc. | Symantec Corp. | |||||
eBay Inc. | ||||||
The Walt Disney Co. | ||||||
Electronic Arts Inc. | TheStreet.com, Inc. | |||||
Time Warner Inc. | ||||||
Expedia, Inc. | Twitter Inc. | |||||
Facebook Inc. | Viacom, Inc. | |||||
Google Inc. | Xo Group Inc. | |||||
Groupon Inc. | Yahoo! Inc. | |||||
IAC/InterActive Corp. | Yelp Inc. | |||||
Intuit Inc. | Zynga Inc. | |||||
obtains data from these companies subject to agreements of confidentiality, but has authorized us to identify the companies below, which represent a few of the larger and better-known companies included in Peer Group 2, but do not necessarily represent companies that reflect the 50th to 75th percentile in terms of the cash compensation paid to their executives.
ABB (China) Ltd. |
IBM China |
Siemens China Ltd. | |
● | Saint-Gobain |
Dell (China) Co., Ltd. |
Shell China Ltd. |
Youku Tudou Co., Ltd. | ||
● | Standard Chartered (Hong Kong) | |
● | Apple (Hong Kong) Inc. | |
● | Singapore Telecommunications Limited |
21Vianet Group Inc. | Net Dragon Websoft Inc. | |||||
500.com Ltd. | NetEase.com, Inc. | |||||
51job, Inc. | NQ Mobile Inc. | |||||
58.com Inc. | Ourgame International Holdings Ltd. | |||||
AirMedia Group Inc. | ||||||
Pacific Online Ltd. | ||||||
Phoenix New Media | ||||||
Autohome Inc. | Qihoo 360 Technology Co | |||||
Baidu.com, Inc. | Qunar Cayman Islands Ltd. | |||||
Bitauto Holdings Ltd. | Renren Inc. | |||||
Cheetah Mobile Inc. | SINA Corp. | |||||
China Finance Online Co. | Sky mobi Ltd. | |||||
Chinanet Online Holdings Inc. | SouFun Holdings Ltd. | |||||
China Parenting Network Holdings Limited | Taomee Holdings Ltd. | |||||
Ctrip.com International, Ltd. | Tencent Holdings Ltd. | |||||
E Commerce China Dangdang Inc. | Tian Ge Interactive Holdings Limited. | |||||
eLong, Inc. | Tuniu Corp. |
iDreamSky Technology Ltd. | V Media Corp. | |||||
Vipshop Holdings Ltd. | ||||||
Jiayuan.com International Ltd. | VisionChina Media Inc. | |||||
Jumei International Holding Ltd. | Weibo Corp. | |||||
Kingsoft Corp. Ltd. | WOWO Ltd. | |||||
KongZhong Corp. | Xunlei Ltd. | |||||
Ku6 Media Co., Ltd. | Youku Tudou Inc. | |||||
Leju Holdings Ltd. | YY Inc. | |||||
Zhaopin Ltd. | ||||||
Key financial measurements such as revenue, operating profit, earnings per share and operating margins; |
Key performance indicator (“KPI”) measurements intended to challenge executive officers to drive high financial and operating results; | |
● |
Promoting commercial excellence by launching new or continuously improving products |
Becoming or remaining as a leading market player and attracting and retaining customers and users; |
Achieving excellence in the named executive officer’s business area of responsibility; and |
Supporting our values by promoting a culture of integrity and adherence to our code of conduct. |
annual base salary for 2016 by a bonus ratio determined based on the criteria described under the heading “2016 Executive Bonus Plan” in this Proxy Statement, (iii) equity awards, and (iv) allowances frequently provided to executives, such as housing allowances, ranging from $80,000 to $150,000.
2016 Increase/(decrease) | |||||||||
Increase/ | Increase/ | 2016 Base Salary | |||||||
2015 Base | (decrease) | (decrease) | Effective | ||||||
Name | Salary | Amount | Percentage | 1-Jan-16 | |||||
Charles Zhang | $653,595 | ($50,931.00)(1) | -8%(1) | $602,664(1) |
(1) | Dr. Charles Zhang’s base salary is denominated and payable in Chinese Yuan (“RMB”), which is the legal currency of China. Dr. Zhang’s base salary, denominated in RMB, for 2016 remained the same as his base salary for 2015, and the decrease in the U.S. dollar-denominated amounts of his base salary from 2015 to 2016 shown in the table above is entirely due to the depreciation of the RMB against U.S. dollars in 2016. |
Hay Group recommended a base salary increase in 2016 for Dr. Charles Zhang. Dr. Zhang, however, decided to voluntarily give up any increase in his base salary in 2016 and our Compensation Committee respected Dr. Zhang’s decision. As a result, Dr. Zhang’s base salary in 2016 remained the same as his base salary in 2015.
2016 Executive Bonus Plan
Our executive bonus plan generally is intended to reward our named executive officers were as follows:
2013 Increase | ||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | 2012 Base Salary | Increase Amount | Increase Percentage | 2013 Base Salary Effective 1-Jan-13 | ||||||||||||||
Charles Zhang | $ | 520,000 | $ | 50,000 | 9.6 | % | $ | 570,000 | ||||||||||
Carol Yu | $ | 420,000 | $ | 40,000 | 9.5 | % | $ | 460,000 | ||||||||||
Belinda Wang | $ | 400,000 | $ | 37,000 | 9.3 | % | $ | 437,000 | ||||||||||
Xiaochuan Wang | $ | 320,000 | $ | 10,000 | 3.1 | % | $ | 330,000 |
In determining the annual bonus rewards the high-performing officers who drive results in these areas and provides them with an incentive to sustain this performance over a long career with us. Under the plan, the named executive officers were eligible to receive a cash bonus equal to a percentage of their base salaries based on the attainment of certain corporate performance goals which were established at the beginning of the year. Once the overall bonus opportunity is calculated, our Chief Executive Officer, with respect to his direct reports (which included Ms. Carol Yu and Ms. Belinda Wang for 2013), or the Compensation Committee, with respect to our Chief Executive Officer, has the discretion to adjust the top bonus opportunity from 150% up to 200% based upon such named executive officer’s individual performance during the year. As Mr. Xiaochuan Wang resigned his position as our Chief Technology Officer on February 3, 2013, he did not participate in our 2013 Executive Bonus Plan, but instead was given a bonus opportunity based on corporate performance goals for Sogou.
Name | 2013 Threshold Bonus Opportunity (as a % of base salary) | 2013 Targeted Bonus Opportunity (as a % of base salary) | 2013 Maximum Bonus Opportunity (as a % of base salary) | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Charles Zhang | 0 | % | 60 | % | 120 | % | ||||||||
Carol Yu | 0 | % | 80 | % | 160 | % | ||||||||
Belinda Wang | 0 | % | 80 | % | 160 | % |
Under our 2016 Executive Bonus Plan:
● | The initial annual bonus ratio for our Chief Executive Officer was determined based on a performance review and was initially equal to the percentage level of attainment of specified corporate performance goals (including specified performance goals for our subsidiaries), except that no annual bonus would be paid unless a minimum weighted percentage level of performance, which was 70% for 2016, was achieved; and |
● | After the initial annual bonus ratio was determined, our Compensation Committee had the discretion to adjust Our Chief Executive Officer’s initial bonus ratio within a pre-determined, specified range based on our Compensation Committee’s non-quantitative evaluation based on strategic indicators and competency indicators. Our Compensation Committee generally did not expect to adjust the initial bonus ratio downward unless our Chief Executive Officer’s performance was deemed to have fallen below expectations. Our Compensation Committee did not establish in advance specific criteria for adjusting the bonus upward (or downward), but made an assessment retroactively based on its judgment of the Chief Executive Officer’s having exceeded expectations in his areas of responsibility. |
The levels of performance attainment on a sliding scale and the corresponding discretion ranges for our Compensation Committee for 2016 were as follows:
Compensation Committee’s | ||||||
Weighted KPI Achievement% | Discretion range | |||||
< 70% | 0 bonus | |||||
70% to 100% (exclusive) | 50%–110 | % | ||||
100% to 110% (exclusive) | 70–130 | % | ||||
110% to 120% (exclusive) | 80–150 | % | ||||
120% to 140% (exclusive) | 100–180 | % | ||||
>=140% | 120–200 | % |
Dr. Charles Zhang’s initial annual bonus ratio for 2016 was 107%, which was equal to attainment of a performance percentage of 107%, determined based on his achievement of specified corporate performance goals for 2016. Our Compensation Committee decided to not exercise its discretion to adjust Dr. Zhang’s initial bonus ratio. As a result, Dr. Zhang’s annual bonus ratio for 2016 was 107%, which we applied to Dr. Zhang’s targeted annual bonus (equal to 100% of Dr. Zhang’s annual base salary for 2016) in calculating his annual bonus for 2016.
Annual Equity Compensation
We did not grant any equity incentive awards to Dr. Charles Zhang in 2016.
Compensation for Ms. Carol YuJoanna Lv in 2016
Key components of Ms. Lv’s compensation for 2016 included:
● | Base Salary. Ms. Lv’s annual base salary for 2016 was $177,635, which was set to reflect Ms. Lv’s level of seniority, responsibility, expertise, skills, knowledge and experience. |
● | Performance-based Cash Bonus.Ms. Lv was entitled to receive a performance-based cash bonus in 2016, payable semi-annually, calculated by multiplying (i) a base amount equal to Ms. Lv’s base salary for an applicable bonus period by (ii) a bonus ratio, subject to further adjustment based on overall corporate performance (weighted 20%), the performance of Ms. Lv’s department (weighted 40%), and Ms. Lv’s individual performance (40%) for the bonus period. The bonus ratio for the first half of 2016 was set at 20%. Our Board of Directors subsequently approved an increase in Ms. Lv’s bonus ratio for the second half of 2016 from 20% to 40% due to her increased level of responsibility after July 31, 2016, when she became our Acting Chief Financial Officer. We paid Ms. Lv a total performance-based cash performance bonus of $72,953 for 2016, representing an average bonus ratio of 41% for 2016. |
● | Long-term Incentives.In 2015, we granted to Ms. Lv under our 2010 Stock Option Plan an option for the purchase of 10,000 shares of our common stock, subject to vesting over a four-year period. Also see “Terms of Stock Option and Restricted Stock Unit Awards and Sogou and Sohu Video Equity Incentive Awards – Sohu Stock Options.” We did not grant any equity incentive awards to Ms. Lv during 2016. |
Compensation for Mr. Xiaochuan Wang awardsin 2016
Mr. Xiaochuan Wang’s compensation package for 2016, consisting of options exercisable for ordinary sharesa mix of Sogou under Sogou’s 2010 Share Incentive Plan,base salary, performance-based cash bonus, long-term incentives and similarly made assumptions about Sogou’s future value in determining the number ofallowances, was designed and implemented by Sogou options that we would grant. The number of Sogou options granted to Ms. Carol Yu was determined in part based on her responsibilitySogou’s 2016 executive compensation program for restructuring and overseeing the overall Sogou business, and the numbermembers of Sogou options grantedSogou’s senior management. Sogou’s Human Resources department made a proposal as to Mr. Xiaochuan Wang was determinedWang’s compensation for 2016 based on his roleits review and analysis of a China Executive Pay Survey Report issued by Mercer Consulting, including competitive executive compensation and performance comparisons for similarly-situated employees at peer companies in China, which proposal Sogou’s Board of Directors approved. After our Board named Mr. Wang as one of our executive officers effective November 1, 2016, Mr. Wang’s compensation package for 2016 remained unchanged.
Key components of Mr. Wang’s compensation for 2016 included:
● | Base Salary. Mr. Wang’s annual base salary for 2016 was approximately $361,598. |
● | Performance-based Cash Bonus. Mr. Wang’s compensation package for 2016 also included a targeted performance-based annual cash bonus of approximately $542,397 for 2016 in connection with his duties as Sogou’s Chief Executive Officer, with specified performance thresholds and target levels on a sliding scale. The initial annual bonus ratio for Mr. Wang was determined based on a performance review and was initially equal to the percentage level of his attainment of specified corporate performance thresholds and targets, except that no annual bonus would be paid unless a specified revenue-based target was achieved. We do not disclose the specific nature and/or actual amounts of these thresholds and targets, as they constitute confidential business and financial information related to Sogou’s internal budgeting and planning that could be unfairly used by Sogou’s competitors if revealed publicly, and we do not believe that the amounts of these targets are material information to our investors. After the initial annual bonus ratio was determined, our Chief Executive Officer had the discretion to adjust Mr. Wang’s initial bonus ratio within a pre-determined, specified range based on our Chief Executive Officer’s non-quantitative evaluation based on strategic indicators and competency indicators. Mr. Wang’s initial annual bonus ratio for 2016 was 112%, which was equal to attainment of a performance percentage of 112%, determined based on his achievement of specified corporate performance goals and targets for 2016. Our Chief Executive Officer decided to not exercise his discretion to adjust Mr. Wang’s initial bonus ratio; and as a result, Mr. Wang’s final bonus ratio was set at 112%. Sogou’s Board of Directors approved this bonus ratio, subject to the approval of our Board of Directors, which subsequently approved it. Accordingly, 112% was the ratio used to calculate the amount of Mr. Wang’s targeted performance-based annual cash bonus for 2016. In addition to the performance-based cash bonus described above, Sogou’s Board of Directors approved a special bonus of approximately $15,067 to Mr. Wang in recognition of his contributions to the development of certain key products for Sogou, subject to the approval of our Board of Directors, which subsequently approved the special bonus. |
● | Long-term Incentives.Mr. Wang, through a British Virgin Islands trust of which he is the beneficiary, holds 7,200,000 restricted Sogou Class A ordinary shares that were issued under Sogou’s 2010 Share Incentive Plan and are subject to vesting in five equal installments over a four-year period, with the first installment vesting following Sogou’s completion of an initial public offering and the expiration of all underwriters’ lockup periods applicable to the initial public offering. Also see “Terms of Stock Option and Restricted Stock Unit Awards and Changyou, Sogou and Sohu Video Equity Incentive Awards - Sogou Share Option/Restricted Shares Awards.” Neither we nor Sogou granted any equity incentive awards to Mr. Wang during 2016. |
Compensation for Mr. Dewen Chen in 2016
Mr. Dewen Chen’s compensation package for 2016, consisted of a mix of base salary, performance-based cash bonus, high-quality game bonus, long-term incentives, and allowances. Our Vice President of Human Resources made recommendations and a proposal as to Mr. Chen’s compensation for 2016 based on discussions with our Chief Executive Officer and their analysis of Sogou, where he has a key leadership rolecompetitive executive compensation and performance comparisons for similarly-situated employees at peer companies in Sogou’s performanceChina’s Internet game industry. Changyou’s Board of Directors then reviewed and approved the expansionproposal. Mr. Chen’s compensation package for 2016 remained unchanged after our Board named Mr. Chen as one of its business.our executive officers effective November 1, 2016.
● | Base Salary. Mr. Chen’s annual base salary for 2016 was approximately $225,999. |
● | Performance-based Cash Bonus. Mr. Chen’s compensation package for 2016 also included a targeted performance-based annual cash bonus of approximately $1,506,659 for Mr. Chen for 2016 in connection with his duties as Changyou’s Chief Executive Officer, with specified performance thresholds and target levels on a sliding scale. The initial annual bonus ratio for Mr. Chen was determined based on a performance review and was initially equal to his percentage level of attainment of specified corporate performance thresholds and targets, except that no annual bonus would be paid unless a minimum weighted percentage level of performance, which was 70%. We do not disclose the specific nature and/or actual amounts of these thresholds and targets, as they constitute confidential business and financial information related to Changyou’s internal budgeting and planning that could be unfairly used by Changyou’s competitors if revealed publicly, and we do not believe that the amounts of these targets are material information to our investors. After the initial annual bonus ratio was determined, Mr. Chen, as Changyou’s Chief Executive Officer, had the discretion to adjust his own initial bonus ratio within a pre-determined, specified range based on his non-quantitative evaluation based on strategic indicators and competency indicators. Mr. Chen’s initial annual bonus ratio for 2016 was 103%, which was equal to attainment of a performance percentage of 103%, determined based on his achievement of specified corporate performance goals and targets for 2016. Mr. Chen, as Changyou’s Chief Executive Officer, decided to not exercise his discretion to adjust his initial bonus ratio; and as a result, Mr. Chen’s final bonus ratio for 2016 was set at 103%. Changyou’s Board of Directors approved this bonus ratio, subject to the approval of our Board of Directors, which subsequently approved it. Changyou then applied this bonus ratio to Mr. Chen’s targeted performance-based annual cash bonus in calculating his annual bonus for 2016. |
● | High-Quality Game Bonus. Mr. Chen’s compensation package for 2016 also included an additional targeted cash bonus of approximately $301,332 for 2016, which was payable only if Changyou launched one or more high-quality games that met specified performance targets. As Changyou did not launch any games in 2016 that met the specified performance targets, no high-quality game bonus will be paid to Mr. Chen for 2016. |
● | Long-term Incentives. Mr. Chen currently holds share options that were granted to him under Changyou’s 2014 Share Incentive Plan for the purchase of Changyou Class A ordinary shares at an exercise price of $0.01 per share, subject to vesting over a four-year period. Also see “Terms of Stock Option and Restricted Stock Unit Awards and Changyou, Sogou and Sohu Video and Share Option Awards – Changyou Share Option/Restricted Share Unit Awards.” Neither we nor Changyou granted any equity incentive awards to Mr. Chen during 2016. |
Other Components of Compensation
Ms. Yu’s base salary for 2015 was at an annual rate of $392,157, which rate remained unchanged in 2016 through her resignation on July 31, 2016. Ms. Yu served as a consultant to the severance benefits afforded under Chinese law because she is notus from August 1, 2016 through December 31, 2016 and received a Chinese national. Rather, she is entitled to severance benefits based on her employment agreementconsulting fee from us in an aggregate amount of $148,522, plus a tax equalization payment with us. With respect to that fee that caused her effective income tax rate on the fee to be 15%,. Ms. Carol Yu ifalso received a bonus, payable in U.S. dollars, for the period from January 1, 2016 through July 31, 2016 in the amount of $182,371 as compensation for serving as our President and Chief Financial Officer, which was equal to 50% of her target bonus in 2015, and a bonus, payable in U.S. dollars, for the same period in the amount of $455,927 as compensation for serving as Co-Chief Executive Officer of Changyou. Ms. Yu’s health benefits and life insurance that were in effect at the time of her resignation continued through December 31, 2016. In addition, we terminateagreed that Ms. Yu could exercise vested options held by her withoutat the time of her resignation for the purchase from us of 720,000 Sogou Class A ordinary shares with an exercise price of $0.625 per share (or a total of $450,000), and we would cause or she terminates her employment with usSogou to purchase from Ms. Yu all of such shares for good reason,a purchase price of $10.00 per share (or a total of $7,200,000). The purchase was completed in January 2017.
In addition, we are obligated to pay her during the severance period (1) her monthly base salarystill in effect on the datediscussions with Ms. Yu regarding treatment of termination, (2) her monthly housing allowance and (3) the continuation of her insurance benefits. She would also be entitled to receive a payment of the bonusunvested options held by Ms. Yu for the remainderpurchase of 2,400,000 Sogou Class A ordinary shares and of vested options held by Ms. Yu for the year in which she was terminated to the extent that the bonus would have been earned had Ms. Carol Yu’s employment continued through the endpurchase of such year.
Respectfully submitted, | ||||||
COMPENSATION COMMITTEE | ||||||
Dr. Dave Qi | ||||||
Dr. Zhonghan Deng |
Sohu | Sohu | ||||||||||||||||||||||||||||||||||||||||
Restricted | Sogou | Changyou | Video | ||||||||||||||||||||||||||||||||||||||
Sohu | Stock | Share | Share | Share | Non-Equity | ||||||||||||||||||||||||||||||||||||
Option | Unit | Option | Option | Option | Incentive Plan | All Other | |||||||||||||||||||||||||||||||||||
Salary | Awards | Awards | Awards | Awards | Awards | Compensation | Compensation | Total | |||||||||||||||||||||||||||||||||
Name and Principal Position | Year | ($) | ($)(1) | ($)(2) | ($)(3) | ($)(4) | ($)(5) | ($) | ($)(6) | ($) | |||||||||||||||||||||||||||||||
Charles Zhang | 2016 | $ | 602,664 | $ | 410,386 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 644,850 | (7) | $ | 960,119 | $ | 2,618,019 | |||||||||||||||||||||
Chairman of the Board and | 2015 | $ | 653,595 | $ | 8,005,621 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 705,882 | $ | 832,042 | $ | 10,197,140 | ||||||||||||||||||||||
Chief Executive Officer | 2014 | $ | 653,595 | $ | 0 | $ | 6,294 | $ | 0 | $ | 0 | $ | 0 | $ | 584,175 | $ | 725,977 | $ | 1,970,041 | ||||||||||||||||||||||
Joanna Lv | 2016 | $ | 177,635 | $ | 9,986 | $ | 0 | $ | 0 | $ | 0 | $ | (4,675 | ) | $ | 72,953 | (8) | $ | 37,117 | $ | 293,016 | ||||||||||||||||||||
Acting Chief | 2015 | $ | 175,377 | $ | 194,803 | $ | 0 | $ | 11,043 | $ | 0 | $ | 1,650 | $ | 45,071 | $ | 38,338 | $ | 466,282 | ||||||||||||||||||||||
Financial Officer | 2014 | $ | 162,800 | $ | 0 | $ | 66,779 | $ | 67,407 | $ | 0 | $ | 22,275 | $ | 42,580 | $ | 35,870 | $ | 397,711 | ||||||||||||||||||||||
Xiaochuan Wang | 2016 | $ | 361,598 | $ | 0 | $ | 0 | $ | 936,768 | $ | 0 | $ | (2,125 | ) | $ | 622,552 | (9) | $ | 176,949 | $ | 2,095,742 | ||||||||||||||||||||
Chief Executive | 2015 | $ | 385,443 | $ | 0 | $ | 0 | $ | 1,510,108 | $ | 0 | $ | 750 | $ | 389,298 | $ | 161,209 | $ | 2,446,808 | ||||||||||||||||||||||
Officer of Sogou | 2014 | $ | 341,880 | $ | 0 | $ | 500,841 | $ | 18,217,021 | $ | 0 | $ | 10,125 | $ | 292,308 | $ | 68,337 | $ | 19,430,512 | ||||||||||||||||||||||
Dewen Chen | 2016 | $ | 225,999 | $ | 0 | $ | 0 | $ | 0 | $ | 1,644,000 | $ | 0 | $ | 1,551,859 | (10) | $ | 417,468 | $ | 3,839,326 | |||||||||||||||||||||
Chief Executive | 2015 | $ | 240,902 | $ | 0 | $ | 0 | $ | 0 | $ | 2,301,430 | $ | 0 | $ | 2,486,108 | $ | 437,359 | $ | 5,465,799 | ||||||||||||||||||||||
Officer of Changyou | 2014 | $ | 276,278 | $ | 0 | $ | 0 | $ | 0 | $ | 646,937 | $ | 0 | $ | 2,048,666 | $ | 276,720 | $ | 3,248,601 | ||||||||||||||||||||||
Carol Yu | 2016 | $ | 228,760 | $ | 0 | $ | 0 | $ | 162,057 | $ | 0 | $ | (53,125 | ) | $ | 638,298 | (11) | $ | 175,231 | $ | 1,151,221 | ||||||||||||||||||||
Former President and | 2015 | $ | 392,157 | $ | 6,671,351 | $ | 0 | $ | 273,988 | $ | 0 | $ | 18,750 | $ | 1,715,686 | $ | 631,162 | $ | 9,703,094 | ||||||||||||||||||||||
Chief Financial Officer | 2014 | $ | 490,196 | $ | 0 | $ | 6,294 | $ | 3,235,551 | $ | 0 | $ | 253,125 | $ | 919,111 | $ | 360,620 | $ | 5,264,897 |
Name and Principal Position | Year | Salary ($) | Sohu Option Awards ($)(1) | Sohu Stock Awards ($)(1) | Sogou Share Option Awards ($)(2) | Sohu Video Share Option Awards ($)(3) | Non-Equity Incentive Plan Compensation ($)(4) | All Other Compensation ($)(5) | Total ($) | |||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Charles Zhang | 2013 | $ | 570,000 | $ | 0 | $ | 123,264 | $ | 0 | $ | 0 | $ | 376,200 | $ | 620,453 | $ | 1,689,917 | |||||||||||||||||||||
Chairman of the Board and | 2012 | $ | 520,000 | $ | 0 | $ | 281,987 | $ | 0 | $ | 0 | $ | 343,200 | $ | 584,442 | $ | 1,729,629 | |||||||||||||||||||||
Chief Executive Officer | 2011 | $ | 460,000 | $ | 0 | $ | 531,051 | $ | 0 | $ | 0 | $ | 276,000 | $ | 504,624 | $ | 1,771,675 | |||||||||||||||||||||
Carol Yu | 2013 | $ | 460,000 | $ | 0 | $ | 123,264 | $ | 249,912 | $ | 0 | $ | 441,600 | $ | 413,375 | $ | 1,688,151 | |||||||||||||||||||||
Co-President and | 2012 | $ | 420,000 | $ | 0 | $ | 281,987 | $ | 228,888 | $ | 0 | $ | 302,400 | $ | 379,862 | $ | 1,613,137 | |||||||||||||||||||||
Chief Financial Officer | 2011 | $ | 350,000 | $ | 0 | $ | 529,000 | $ | 109,678 | $ | 0 | $ | 273,000 | $ | 320,908 | $ | 1,582,586 | |||||||||||||||||||||
Belinda Wang | 2013 | $ | 437,000 | $ | 0 | $ | 164,352 | $ | 167,569 | $ | 0 | $ | 349,600 | $ | 104,683 | $ | 1,223,204 | |||||||||||||||||||||
Co-President and | 2012 | $ | 400,000 | $ | 0 | $ | 375,982 | $ | 190,740 | $ | 0 | $ | 352,000 | $ | 120,007 | $ | 1,438,729 | |||||||||||||||||||||
Chief Operating Officer | 2011 | $ | 340,000 | $ | 0 | $ | 704,649 | $ | 91,399 | $ | 0 | $ | 326,400 | $ | 78,819 | $ | 1,541,267 | |||||||||||||||||||||
Xiaochuan Wang | 2013 | $ | 330,000 | $ | 0 | $ | 123,264 | $ | 1,786,728 | $ | 0 | $ | 287,760 | $ | 59,390 | $ | 2,587,142 | |||||||||||||||||||||
Chief Technology Officer | 2012 | $ | 320,000 | $ | 0 | $ | 281,987 | $ | 2,359,260 | $ | 0 | $ | 211,200 | $ | 54,790 | $ | 3,227,237 | |||||||||||||||||||||
2011 | $ | 230,000 | $ | 0 | $ | 528,132 | $ | 1,011,614 | $ | 0 | $ | 207,000 | $ | 45,765 | $ | 2,022,511 |
(1) | Options for the purchase of Sohu common stock contractually granted under the Sohu 2010 Stock Incentive Plan are subject to vesting in four equal installments over a period of four years, with each installment vesting upon satisfaction of a service period requirement and certain subjective performance targets. Compensation expense was accrued based on the then-current fair value of the awards. |
(2) | Amount represents |
(3) | Amount represents expense recognized with respect to Sogou share option awards. | |
(4) | Amount represents expense recognized with respect to Changyou share option awards. These share option awards, exercisable for the |
(5) | Sohu Video share options, which are exercisable for the purchase of Sohu Video ordinary shares, were granted in 2012 under Sohu Video’s 2011 Share Incentive Plan. |
(6) | The table below shows the components of this column for |
Health, | ||||||||||||||||||||||||
Life, Travel | ||||||||||||||||||||||||
Housing | Tax | and Disability | Other | |||||||||||||||||||||
Name | Allowance | Equalization | Insurance | Allowance | Total | |||||||||||||||||||
Charles Zhang | $ | 301,332 | $ | 629,974 | $ | 28,813 | $ | 0 | $ | 960,119 | ||||||||||||||
Joanna Lv | $ | 18,080 | $ | 0 | $ | 18,314 | $ | 723 | $ | 37,117 | ||||||||||||||
Xiaochuan Wang | $ | 150,666 | $ | 0 | $ | 26,283 | $ | 0 | $ | 176,949 | ||||||||||||||
Dewen Chen | $ | 376,665 | $ | 0 | $ | 35,680 | $ | 5,123 | $ | 417,468 | ||||||||||||||
Carol Yu | $ | 114,379 | $ | 33,470 | $ | 27,382 | $ | 0 | $ | 175,231 |
(7) | Consists of an annual cash bonus earned for 2016 that was paid by Sohu to Mr. Charles Zhang pursuant to our 2016 Executive Bonus Plan. | |
(8) | Consists of cash bonuses earned for 2016 that were paid by Sohu to Ms. Lv. See “Compensation Discussion and Analysis – Compensation for Ms. Joanna Lv in 2016.” | |
(9) | Consists of an annual cash bonus earned for 2016 that has not yet been paid by Sogou to Mr. Wang. See “Compensation Discussion and Analysis – Compensation for Mr. Xiaochuan Wang in 2016.” | |
(10) | Consists of an annual cash bonus earned for 2016 that was paid by Changyou to Mr. Chen. See “Compensation Discussion and Analysis – Compensation for Mr. Dewen Chen in 2016.” | |
(11) | Consists of a bonus for the period from January 1, 2016 through July 31, 2016 in the amount of $182,371 paid to Ms. Yu as compensation for serving as our President and Chief Financial Officer and a bonus for the same period in the amount of $455,927 paid to Ms. Yu as compensation for serving as Co-Chief Executive Officer of Changyou. |
Name | Housing Allowance | Tax Equalization | Health, Life, Travel and Disability Insurance | Training fees | Total | |||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Charles Zhang | $ | 150,000 | $ | 446,470 | $ | 23,983 | $ | 0 | $ | 620,453 | ||||||||||||
Carol Yu | $ | 150,000 | $ | 232,365 | $ | 31,010 | $ | 0 | $ | 413,375 | ||||||||||||
Belinda Wang | $ | 80,000 | $ | 0 | $ | 24,683 | $ | 0 | $ | 104,683 | ||||||||||||
Xiaochuan Wang | $ | 40,000 | $ | 0 | $ | 19,390 | $ | 0 | $ | 59,390 |
Estimated Payouts Under Non-Equity | |||||||||||||||
Incentive Plan Awards | |||||||||||||||
Threshold | Target | Maximum | |||||||||||||
Name | ($) | ($) | ($) | ||||||||||||
Charles Zhang(1) | $0 | $ | 602,664 | $ | 1,205,328 | ||||||||||
Joanna Lv(2) | $0 | $ | 53,607 | $ | 66,473 | ||||||||||
Xiaochuan Wang(3) | $0 | $ | 542,397 | $ | 1,084,795 | ||||||||||
Dewen Chen(4) | $0 | $ | 1,807,991 | $ | 3,615,983 | ||||||||||
Carol Yu(5) | N/A | N/A | N/A |
Estimated Payouts Under Non-Equity Incentive Plan Awards(1) | ||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Stock Award Grant Date | Threshold ($) | Target ($) | Maximum ($) | All Other Stock Awards: Number of Shares of Stock or Units Sogou | Grant Date Fair Value of Stock and Option Awards Sogou | ||||||||||||||||||||
Charles Zhang | N/A | $ | 0 | $ | 342,000 | $ | 684,000 | 0 | N/A | |||||||||||||||||
Carol Yu | 3/1/2013 | $ | 0 | $ | 368,000 | $ | 736,000 | 2,400,000 | (2) | 0.38 | ||||||||||||||||
Belinda Wang | N/A | $ | 0 | $ | 349,600 | $ | 699,200 | N/A | N/A | |||||||||||||||||
Xiaochuan Wang | 1/31/2013 | $ | 0 | $ | 264,000 | $ | 528,000 | 7,200,000 | (3) | 0.38 |
(1) | The amounts shown represent the range of non-equity incentive bonus opportunities for | |
(2) | The amounts shown represent the range of non-equity incentive bonus opportunities for Ms. Lv during 2016. See “Compensation Discussion and Analysis – Compensation for Ms. Joanna Lv in 2016” above. Payment of a bonus in the amount of $24,354 for the first half of 2016 was made to |
(3) | ||
(4) | The amounts shown represent the range of | |
(5) | As Ms. Yu resigned as our President and Chief Financial Officer effective July 31, 2016, she did not participate in our 2016 Executive Bonus Plan or the bonus plans of any of our subsidiaries. |
Executive Employment Agreements
We normally enterhave entered into a three-year employment agreementsagreement with our named executive officers.Chief Executive Officer, Dr. Charles Zhang, and Changyou has entered into an employment agreement with Mr. Dewen Chen, Changyou’s Chief Executive Officers. Under these employment agreements, the named executive officersDr. Zhang and Mr. Chen are generally entitled to (i) annual base salaries; (ii) an annual performance-based cash bonus; and (iii) equity incentive compensation, all as representedpresented in the Summary Compensation Table for 2013. The2016. These employment agreements may also provide for the followingcertain additional benefits forto the named executive officers:extent applicable, including vacation time, health, life, travel and disability insurance, housing allowances and tuition/training reimbursement and, in the case of Dr. Zhang, tax equalization.
payments equal to |
insurance benefits for so long as we are obligated to pay severance. |
he will not be entitled to any further payments from |
any insurance or other benefits that have continued will terminate immediately; and |
he must reimburse us or Changyou, as applicable, for any severance payments previously made by us to the named executive officer. |
Employment Agreements with Ms. Joanna Lv and Mr. Xiaochuan Wang
Our indirect wholly-owned subsidiary Beijing Sohu New Media Information Technology Co., Ltd. entered into an open-ended employment agreement with Ms. Joanna Lv, and our subsidiary Beijing Sogou Technology Development Co., Ltd. entered into an open-ended employment agreement with Mr. Xiaochuan Wang. Under these employment agreements, Ms. Lv and Mr. Wang are entitled to (i) base salaries and (ii) a performance-based cash bonus, both as presented in the Summary Compensation Table for 2016. Their employment agreements also provide for certain additional benefits to the extent applicable, including vacation time; life, unemployment, medical, work-related injury and other insurance; and allowances for housing. Ms. Lv and Mr. Wang also agreed in these employment agreements to be bound by obligations regarding (i) assignment of intellectual property and (ii) confidential treatment of proprietary information. These employment agreements are governed by the Chinese law.
Terms of Stock Option and Restricted Stock Unit Awards and Changyou, Sogou and Sohu Video Share OptionEquity Incentive Awards
Sohu Stock Options
The granted stock options as reflected in the “Outstanding Equity Awards at Fiscal Year End Table”End” table were granted to our named executive officers under our 2010 Stock Incentive Plan. On February 16, 2015, our Board approved grants of options to our management and key employees, including options (i) to our Chief Executive Officer Dr. Charles Zhang for the purchase of 300,000 shares of common stock and (ii) to Ms. Joanna Lv, who was then our Senior Finance Director, for the purchase of 10,000 shares of common stock with an exercise price of $0.001 per share. The options are subject to vesting in four equal annual installments commencing February 7, 2016. If our Chief Executive Officer determines, in his sole discretion, that the following termsperformance of any of the grantees, including himself and conditions. AllMs. Lv, in connection with his or her employment with us is not satisfactory, one or more installments or a portion of any installment of his or her unvested options may be forfeited and automatically suspended, and will remain so suspended indefinitely, unless and until our Chief Executive Officer determines, in his sole discretion, that all or part of such vesting should be resumed. Ms. Carol Yu, our former President and Chief Financial Officer, was also granted options on February 16, 2015 with a nominal exercise price of $0.001 per share for the purchase of 250,000 share of common stock, options granted under our 2000 Stock Incentive Plan that had not been forfeited or exercisedof which 62,500 were fully vested as of December 31, 2009. If we grant stock options underMs. Yu’s resignation and the 2010unvested balance of which was forfeited by Ms. Yu.
Sohu Restricted Stock Incentive Plan, 25% of the options will vest each year, beginning on the first anniversary of the grant date, unless our Compensation Committee determines otherwise with the approval of our full Board. The exercise prices of stock options granted under our 2000 Stock Incentive Plan were determined, and any future grants under the 2010 Stock Incentive Plan will be determined, based on the fair market value of a share of our common stock on the date of grant. Units
Under our 2000 Stock Incentive Plan the fair market value is determined,we could grant, and under the 2010 Stock Incentive Plan the fair market value will be determined, as of the last business day for which the prices or quotes for our common stock are available prior to the date an option is granted and was, and will be, equal to the average, on such date, of the high and low prices of our common stock on the NASDAQ Global Select Market. The stock options are, and will be, only exercisable for the purchase of our common stock and have a term of ten years.
Sohu Video Share Option Awards
On November 2, 2014, Changyou granted to Mr. Dewen Chen, Changyou’s Chief Executive Officer, 600,000 Changyou Class A restricted share units under Changyou’s 2014 Share incentive Plan, subject to vesting over a four-year period. On February 16, 2015, Changyou’s Board of Directors approved the conversion of 600,000 Class A restricted share units held by Mr. Chen into options for the purchase of Class A ordinary shares at an exercise price of $0.01, subject to the same vesting terms.
Option Awards(1) | Stock Awards(1) | ||||||||||||||||
Number of | Number of | Number of | |||||||||||||||
Securities | Securities | Shares or | Market Value | ||||||||||||||
Underlying | Underlying | Units of | of Shares or | ||||||||||||||
Unexercised | Unexercised | Option | Stock That | Units of Stock | |||||||||||||
Options | Options | Exercise | Option | Have Not | That Have | ||||||||||||
Exercisable | Unexercisable | Price | Expiration | Vested | Not Vested | ||||||||||||
Name | (#) | (#) | ($) | Date | (#) | ($) | |||||||||||
Charles Zhang | 75,000 | 225,000 | $ | 0.001 | 2/15/2025 | (2) | 0 | $0 | |||||||||
Joanna Lv | 0 | 7,500 | $ | 0.001 | 2/15/2025 | (2) | 0 | $0 | |||||||||
Carol Yu | 62,500 | 0 | $ | 0.001 | 2/15/2025 | (2) | 0 | $0 |
Option Awards(1) | Stock Awards(1) | ||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | |||||||||||||||||||||
Charles Zhang | 30,000 | (2) | 0 | $ | 22.86 | 7/25/2015 | (3) | 7,500 | (4) | $ | 546,975 | ||||||||||||||||
Carol Yu | — | — | — | — | 7,500 | (4) | $ | 546,975 | |||||||||||||||||||
Belinda Wang | — | — | — | — | 10,000 | (4) | $ | 729,300 | |||||||||||||||||||
Xiaochuan Wang | — | — | — | — | 7,500 | (4) | $ | 546,975 |
(1) | Sohu options |
(2) |
The grant date of each option is listed on the table below by reference to the expiration date set forth in the table below. |
Grant Date | Expiration Date | |||||||||
Name | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares That Have Not Vested (#) | Market Value of Shares That Have Not Vested ($) | ||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Carol Yu | — | 720,000 | (5) | $ | 0.625 | 6/3/2021 | (7) | — | — | |||||||||||||||||
— | 2,400,000 | (6) | $ | 0.625 | 2/28/2023 | (7) | — | — | ||||||||||||||||||
Belinda Wang | — | 1,200,000 | (5) | $ | 0.625 | 6/3/2021 | (7) | — | — | |||||||||||||||||
Xiaochuan Wang | — | — | — | — | 14,400,000 | (8) | N/A | (9) |
Share Option Awards | Restricted Share Awards | ||||||||||||||||
Number of | Number of | Number of | |||||||||||||||
Securities | Securities | Shares or | Market Value | ||||||||||||||
Underlying | Underlying | Units of | of Shares or | ||||||||||||||
Unexercised | Unexercised | Option | Stock That | Units of Stock | |||||||||||||
Options | Options | Exercise | Option | Have Not | That Have | ||||||||||||
Exercisable | Unexercisable | Price | Expiration | Vested | Not Vested | ||||||||||||
Name | (#) | (#) | ($) | Date | (#) | ($) | |||||||||||
Xiaochuan Wang | 0 | 0 | 7,200,000 | (3) | N/A | ||||||||||||
Carol Yu | 720,000 | (4) | 0 | $0.625 | 6/3/2021 | (5) | |||||||||||
2,400,000 | (6) | $0.625 | 2/28/2023 | (5) |
anniversaries of Sogou’s |
then fair market value of those shares. There is no public market for Sogou ordinary shares. |
Name | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price ($) | Option Expiration Date | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Carol Yu | 0 | (10) | 1,250,000 | $ | 0.01 | 1/3/2022 | (11) | |||||||||||
Belinda Wang | 0 | (10) | 1,250,000 | $ | 0.01 | 1/3/2022 | (11) | |||||||||||
Xiaochuan Wang | 0 | (10) | 50,000 | $ | 0.01 | 1/3/2022 | (11) |
Consists of options granted to Ms. Carol Yu by Sohu |
(5) | The grant date of each option |
Grant Date | Expiration Date | |||||||||
6/4/2011 | 6/3/2021 | |||||||||
3/1/ | 2/28/2023 |
(6) | Consists of unvested options previously granted to Ms. Yu for the purchase of 2,400,000 ordinary shares of Sogou held by us. There is a detailed description above under the heading “Sogou Share Option/Restricted Share Awards.” |
Sohu Video Share Option Awards
Number of | Number of | |||||||||||||
Securities | Securities | |||||||||||||
Underlying | Underlying | |||||||||||||
Unexercised | Unexercised | Option | ||||||||||||
Options | Options | Exercise | Option | |||||||||||
Exercisable | Unexercisable | Price | Expiration | |||||||||||
Name | (#) | (#) | ($) | Date | ||||||||||
Joanna Lv | 27,500 | (7) | 82,500 | $0.01 | 1/3/2022 | (8) | ||||||||
Carol Yu | 312,500 | (7) | 0 | $0.01 | 1/3/2022 | (8) |
(7) | ||
(8) | The grant date of these options was January 4, 2012. |
Changyou Share Option Awards
Number of | Number of | |||||||||||||
Securities | Securities | |||||||||||||
Underlying | Underlying | |||||||||||||
Unexercised | Unexercised | Option | ||||||||||||
Options | Options | Exercise | Option | |||||||||||
Exercisable | Unexercisable | Price | Expiration | |||||||||||
Name | (#) | (#) | ($) | Date | ||||||||||
Dewen Chen | 260,000 | (9) | 300,000 | $0.01 | 11/1/2024 | (10) |
(9) | Options granted to Mr. Dewen Chen by Changyou under its 2014 Share Incentive Plan. There is a detailed description above under the heading “Changyou Share Option/Restricted Share Units Awards.” | |
(10) | The grant date of these share options was November 2, 2014. |
Option Awards(1) | ||||||||||||||||
SOHU | Sogou | Changyou | ||||||||||||||
Number of Shares | Value | Number of Shares | Value | |||||||||||||
Number of Shares | Value | Acquired On | Realized on | Acquired On | Realized on | |||||||||||
Acquired On | Realized On | Exercise | Exercise | Exercise | Exercise | |||||||||||
Name | Exercise | Exercise | (#) | ($) | (#) | ($) | ||||||||||
Joanna Lv | 2,500 | $101,075 | 30,000 | $ | 117,900 | (2) | ||||||||||
Dewen Chen | 40,000 | $471,800 |
Option Awards(1) | Stock Awards(2) | ||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sohu | Sogou | Sohu | |||||||||||||||||||||||||
Name | Number of Shares Acquired On Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired On Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) | |||||||||||||||||||||
Charles Zhang | 9,000 | $ | 296,640 | 0 | $ | 0 | 0 | (3) | $ | 0 | |||||||||||||||||
Carol Yu | 0 | $ | 0 | 1,440,000 | $ | 1,915,200 | 7,500 | $ | 360,150 | ||||||||||||||||||
Belinda Wang | 0 | $ | 0 | 600,000 | $ | 9,000 | 10,000 | $ | 480,200 | ||||||||||||||||||
Xiaochuan Wang | 5,000 | $ | 178,300 | 10,800,000 | (4) | $ | 5,778,000 | 7,500 | $ | 364,950 |
(1) | Reflects shares received upon the exercise of stock options granted under the Sohu |
Calculated based on the fair market value of |
The employment agreements with each of our named executive officers. These agreements,Dr. Zhang and Mr. Chen, along with Chinese legal requirements which are discussed in the Compensation Discussion and Analysis under the heading “Severance Benefits,” provide for certain payments and other benefits if a named executive officer’sDr. Zhang’s or Mr. Chen’s employment with us or Changyou, as applicable, is terminated under circumstances specified in his or her respectiveemployment agreement, including a change-in-control of us.us or Changyou, as applicable. Chinese legal requirements also provide for certain payments and benefits if an employment agreement is not renewed. A named executive officer’sDr. Zhang’s or Mr. Chen’s rights upon the termination of his or her employment will depend upon the circumstances of the termination. Central to an understanding of the rights of each named executive officerDr. Zhang and Mr. Chen under thetheir employment agreements is an understanding of the definitions of “cause,” “change-in-control,” “good reason” and “disability” that are used in those agreements. For purposes of the employment agreements such terms have the following meanings:
willful misconduct or gross negligence by the |
misconduct or negligence of the |
breach of any of the |
any attempt by the |
the |
declaration by a court that the |
habitual drug or alcohol abuse which materially impairs the |
filing of any petition or other proceeding seeking to find the |
any person (within the meaning of Section 13(d) or Section 14(d)(2) of the Securities Exchange Act of 1934) other than us or Changyou, as applicable, any trustee or other fiduciary holding securities under an employee benefit plan of |
during any period of two consecutive years after the date of the |
the effective date of a merger or consolidation of us or Changyou, as applicable, with any other entity, other than a merger or consolidation which would result in our or Changyou’s, as applicable, voting securities outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation and with the power to elect at least a majority of the board of directors or other governing body of such surviving entity; |
our or Changyou’s, as applicable, complete liquidation or the sale or disposition by us or Changyou, as applicable, of all or substantially all of our assets or Changyou’s, as applicable, assets; or |
there occurs any other event of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or a response to any similar item on any similar schedule or form) promulgated under the Securities and Exchange Act of 1934, whether or not we are then subject to such reporting requirements. |
any significant change in the duties and responsibilities of the |
any material breach by us or Changyou, as applicable, of the employment agreement with the |
the failure, in the event of a change-in-control in which we are, or Changyou is, as applicable, not the surviving entity, of the surviving entity or the successor to our or Changyou’s, as applicable, business to assume the |
Potential Payments Upon Termination or Chang-in-Control
Involuntary | |||||||||||||||||||||||||||||||||
Termination | Change in Control | ||||||||||||||||||||||||||||||||
Involuntary | |||||||||||||||||||||||||||||||||
Voluntary | Voluntary | Termination | |||||||||||||||||||||||||||||||
Resignation | Resignation | within 12 months | |||||||||||||||||||||||||||||||
Compensation | for Good | Death or | Without | For | for Good | Without | For | ||||||||||||||||||||||||||
Name | Element | Reason | Disability | Cause | Cause | Reason | Cause | Cause | |||||||||||||||||||||||||
Charles Zhang | Severance Pay(1) | $ | 301,332 | (2) | $ | 0 | $ | 301,332 | (2) | $ | 0 | $ | 301,332 | (2) | $ | 301,332 | (2) | $ | 0 | ||||||||||||||
Housing Allowance(1) | $ | 150,666 | $ | 0 | $ | 150,666 | $ | 0 | $ | 150,666 | $ | 150,666 | $ | 0 | |||||||||||||||||||
Bonus | $ | 0 | (3) | $ | 0 | (4) | $ | 0 | (3) | $ | 0 | $ | 0 | (3) | $ | 0 | (3) | $ | 0 | ||||||||||||||
Benefits | $ | 14,407 | $ | 0 | $ | 14,407 | $ | 0 | $ | 14,407 | $ | 14,407 | $ | 0 | |||||||||||||||||||
Accelerated Vesting | |||||||||||||||||||||||||||||||||
of Sohu Stock Options | |||||||||||||||||||||||||||||||||
and Restricted Stock | |||||||||||||||||||||||||||||||||
Unit Awards | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||||||||||
Total | $ | 466,405 | $ | 0 | $ | 466,405 | $ | 0 | $ | 466,405 | $ | 466,405 | $ | 0 | |||||||||||||||||||
Joanna Lv | Severance Pay(1)(5) | $ | 54,449 | $ | 0 | $ | 54,449 | $ | 0 | $ | 54,449 | $ | 54,449 | $ | 0 | ||||||||||||||||||
Housing Allowance | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||||||||||
Bonus | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||||||||||
Benefits | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||||||||||
Accelerated Vesting | |||||||||||||||||||||||||||||||||
of Sohu Stock Options | |||||||||||||||||||||||||||||||||
and Restricted Stock | |||||||||||||||||||||||||||||||||
Unit Awards | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||||||||||
Total | $ | 54,449 | $ | 0 | $ | 54,449 | $ | 0 | $ | 54,449 | $ | 54,449 | $ | 0 |
Involuntary | ||||||||||||||||||||||||||||||||
Termination | Change in Control | |||||||||||||||||||||||||||||||
Involuntary | ||||||||||||||||||||||||||||||||
Voluntary | Voluntary | Termination | ||||||||||||||||||||||||||||||
Resignation | Resignation | within 12 months | ||||||||||||||||||||||||||||||
Compensation | for Good | Death or | Without | For | for Good | Without | For | |||||||||||||||||||||||||
Name | Element | Reason | Disability | Cause | Cause | Reason | Cause | Cause | ||||||||||||||||||||||||
Xiaochuan Wang | Severance Pay(1)(5) | $ | 54,449 | $ | 0 | $ | 54,449 | $ | 0 | $ | 0 | $ | 54,449 | $ | 0 | |||||||||||||||||
Housing Allowance | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||||||
Bonus | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||||||
Benefits | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||||||
Accelerated Vesting | ||||||||||||||||||||||||||||||||
of Sogou Share | ||||||||||||||||||||||||||||||||
Options Awards | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||||||
Total | $ | 54,449 | $ | 0 | $ | 54,449 | $ | 0 | $ | 0 | $ | 54,449 | $ | 0 | ||||||||||||||||||
Dewen Chen | Severance Pay(1) | $ | 112,999 | (2) | $ | 0 | $ | 112,999 | (2) | $ | 0 | $ | 112,999 | (2) | $ | 112,999 | (2) | $ | 0 | |||||||||||||
Housing Allowance(1) | $ | 188,332 | $ | 0 | $ | 188,332 | $ | 0 | $ | 188,332 | $ | 188,332 | $ | 0 | ||||||||||||||||||
Bonus | $ | 0 | (3) | $ | 0 | (4) | $ | 0 | (3) | $ | 0 | $ | 0 | (3) | $ | 0 | (3) | $ | 0 | |||||||||||||
Benefits | $ | 17,871 | $ | 0 | $ | 17,871 | $ | 0 | $ | 17,871 | $ | 17,871 | $ | 0 | ||||||||||||||||||
Accelerated Vesting | ||||||||||||||||||||||||||||||||
of Changyou Share | ||||||||||||||||||||||||||||||||
Options Awards | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||||||
Total | $ | 319,202 | $ | 0 | $ | 319,202 | $ | 0 | $ | 319,202 | $ | 319,202 | $ | 0 |
Involuntary Termination | Change in Control | ||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Involuntary Termination within 12 months | |||||||||||||||||||||||||||||||||||
Name | | Compensation Element | | Voluntary Resignation for Good Reason | | Death or Disability | | Without Cause | | For Cause | | Voluntary Resignation for Good Reason | | Without Cause | | For Cause | |||||||||||||||||||
Charles Zhang | Severance Pay(1) | $ | 299,947 | (2) | $ | 0 | $ | 299,947 | (2) | $0 | $ | 299,947 | (2) | $ | 299,947 | (2) | $0 | ||||||||||||||||||
Housing Allowance(1) | $ | 150,000 | $ | 0 | $ | 150,000 | $0 | $ | 150,000 | $ | 150,000 | $0 | |||||||||||||||||||||||
Bonus | $ | 0 | (3) | $ | 0 | (4) | $ | 0 | (3) | $0 | $ | 0 | (3) | $ | 0 | (3) | $0 | ||||||||||||||||||
Benefits | $ | 11,991 | $ | 0 | $ | 11,991 | $0 | $ | 11,991 | $ | 11,991 | $0 | |||||||||||||||||||||||
Accelerated Vesting of Sohu Stock Options and Restricted Stock Unit Awards | $ | 0 | $ | 0 | $ | 0 | $0 | $ | 0 | $ | 6,294 | $0 | |||||||||||||||||||||||
Total | $ | 461,938 | $ | 0 | $ | 461,938 | $0 | $ | 461,938 | $ | 468,232 | $0 | |||||||||||||||||||||||
Carol Yu | Severance Pay(1) | $ | 230,000 | $ | 0 | $ | 230,000 | $0 | $ | 230,000 | $ | 230,000 | $0 | ||||||||||||||||||||||
Housing Allowance(1) | $ | 75,000 | $ | 0 | $ | 75,000 | $0 | $ | 75,000 | $ | 75,000 | $0 | |||||||||||||||||||||||
Bonus | $ | 0 | (3) | $ | 0 | (4) | $ | 0 | (3) | $0 | $ | 0 | (3) | $ | 0 | (3) | $0 | ||||||||||||||||||
Benefits | $ | 15,505 | $ | 0 | $ | 15,505 | $0 | $ | 15,505 | $ | 15,505 | $0 | |||||||||||||||||||||||
Accelerated Vesting of Sohu Stock Options and Restricted Stock Unit Awards | $ | 0 | $ | 0 | $ | 0 | $0 | $ | 0 | $ | 6,294 | $0 | |||||||||||||||||||||||
Accelerated Vesting of Sogou Share Options Awards | $ | 0 | $ | 0 | $ | 0 | $0 | $ | 0 | $ | 0 | $0 | |||||||||||||||||||||||
Total | $ | 320,505 | $ | 0 | $ | 320,505 | $0 | $ | 320,505 | $ | 326,799 | $0 |
Involuntary Termination | Change in Control | ||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Involuntary Termination within 12 months | |||||||||||||||||||||||||||||||||||
Name | | Compensation Element | | Voluntary Resignation for Good Reason | | Death or Disability | | Without Cause | | For Cause | | Voluntary Resignation for Good Reason | | Without Cause | | For Cause | |||||||||||||||||||
Belinda Wang | Severance Pay(1) | $ | 233,447 | (2) | $ | 0 | $ | 233,447 | (2) | $0 | $ | 233,447 | (2) | $ | 233,447 | (2) | $0 | ||||||||||||||||||
Housing Allowance(1) | $ | 80,000 | $ | 0 | $ | 80,000 | $0 | $ | 80,000 | $ | 80,000 | $0 | |||||||||||||||||||||||
Bonus | $ | 0 (3 | ) | $ | 0 (4 | ) | $ | 0 (3 | ) | $0 | $ | 0 (3 | ) | $ | 0 (3 | ) | $0 | ||||||||||||||||||
Benefits | $ | 12,341 | $ | 0 | $ | 12,341 | $0 | $ | 12,341 | $ | 12,341 | $0 | |||||||||||||||||||||||
Accelerated Vesting of Sohu Stock Options and Restricted Stock Unit Awards | $ | 0 | $ | 0 | $ | 0 | $0 | $ | 0 | $ | 8,392 | $0 | |||||||||||||||||||||||
Accelerated Vesting of Sogou Share Options Awards | $ | 0 | $ | 0 | $ | 0 | $0 | $ | 0 | $ | 40,691 | $0 | |||||||||||||||||||||||
Total | $ | 325,788 | $ | 0 | $ | 325,788 | $0 | $ | 325,788 | $ | 374,871 | $0 | |||||||||||||||||||||||
Xiaochuan Wang | Severance Pay(1) | $ | 179,852 | (2) | $ | 0 | $ | 179,852 | (2) | $0 | $ | 179,852 | (2) | $ | 179,852 | (2) | $0 | ||||||||||||||||||
Housing Allowance(1) | $ | 40,000 | $ | 0 | $ | 40,000 | $0 | $ | 40,000 | $ | 40,000 | $0 | |||||||||||||||||||||||
Bonus | $ | 0 | (3) | $ | 0 | (4) | $ | 0 | (3) | $0 | $ | 0 | (3) | $ | 0 | (3) | $0 | ||||||||||||||||||
Benefits | $ | 9,695 | $ | 0 | $ | 9,695 | $0 | $ | 9,695 | $ | 9,695 | $0 | |||||||||||||||||||||||
Accelerated Vesting of Sohu Stock Options and Restricted Stock Unit Awards | $ | 0 | $ | 0 | $ | 0 | $0 | $ | 0 | $ | 6,294 | $0 | |||||||||||||||||||||||
Accelerated Vesting of Sogou Share Options Awards | $ | 0 | $ | 0 | $ | 0 | $0 | $ | 0 | $ | 434,052 | N/A | |||||||||||||||||||||||
Total | $ | 229,547 | $ | 0 | $ | 229,547 | $0 | $ | 229,547 | $ | 669,893 | $0 |
(1) | Severance payments are made ratably over the severance period according to our, Sogou’s, or Changyou’s standard payroll |
(2) |
In the event of a voluntary resignation for good reason or an involuntary termination without cause, | ||
(3) | In the event of a voluntary resignation for good reason or an involuntary termination without cause, Dr. Charles Zhang and Mr. Dewen Chen are entitled to receive their bonuses for the remainder of the year of the termination, but only to the extent that the |
(4) | In the event of | |
(5) | Severance benefits required to be made under Chinese law. |
Sohu Restricted | Special | ||||||
Stock Units Awards | Compensation | Total | |||||
Name | ($)(2) | ($)(3) | ($) | ||||
Dave Qi | $119,940 | $45,000 | $164,940 | ||||
Edward B. Roberts (4) | $119,940 | N//A | $119,940 | ||||
Shi Wang | $105,560 | N/A | $105,560 | ||||
Charles Huang | $105,560 | $50,000 | $155,560 | ||||
Zhonghan Deng | $105,560 | $25,000 | $130,560 |
Name | Sohu Option Awards ($)(2)(3) | Sohu Stock Awards ($)(2)(4) | Total ($) | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dave Qi | — | $ | 144,870 | $ | 144,870 | |||||||||
Shi Wang | — | $ | 127,468 | $ | 127,468 | |||||||||
Edward B. Roberts | — | $ | 144,870 | $ | 144,870 | |||||||||
Charles Huang | — | $ | 127,468 | $ | 127,468 | |||||||||
Zhonghan Deng | — | $ | 127,468 | $ | 127,468 |
(1) | Dr. Charles Zhang has been omitted from this table because he receives no compensation for serving on our Board. All compensation paid to Dr. |
(2) |
(3) | Amounts represent compensation paid to members of a special committee of our Board, consisting of Dr. Dave Qi, Mr. Charles Huang, and Dr. Zhonghan Deng, that was formed in | |
(4) | Mr. Edward B. Roberts resigned from our Board effective January 31, 2017. |
On January 12, 2016, Drs. Edward B. Roberts and Dave Qi were each granted 2,352 restricted stock units, and Messrs. Charles Huang, Shi Wang and Dr. Zhonghan Deng were each granted 2,070 restricted stock units. 50% of these restricted stock units vested on July 1, 2016 and the remaining 50% vested on December 31, 2016.
As provided in the Dodd-Frank Act, this vote will not be binding on our Board and may not be construed as overruling a decision by our Board, creating or implying any change to the fiduciary duties of our Board or any additional fiduciary duty by our Board or restricting or limiting the ability of stockholders to make proposals for inclusion in proxy materials related to executive compensation. Our Board and our Compensation Committee, however, may take into account the outcome of the vote when considering future executive compensation arrangements.
Section 951 of the Dodd-Frank Act and the implementing regulations of the Securities and Exchange Commission thereunder require that at the first annual meeting of stockholders held on or after January 21, 2011 and not less frequently than once every six years thereafter we must include a separate resolution subject to a stockholder advisory vote to determine whether the stockholder advisory vote on executive compensation that is the subject of Proposal II should occur every one, two or three years. Accordingly, at this year’s Annual Meeting, we are required under Section 951 of the Dodd-Frank Act to include a separate resolution subject to a stockholder advisory vote on the frequency of future advisory votes on our executive compensation.
Our Board welcomes the views of stockholders on executive compensation matters. Therefore, particularly in view of the previous vote by our stockholders of on the subject, our Board believes that it is desirable to have the advisory vote on executive compensation occur every year. Accordingly, our Board recommends that the advisory vote on executive compensation occur every year.
As provided in the Dodd-Frank Act, this vote will not be binding on our Board and may not be construed as overruling a decision by our Board, creating or implying any change to the fiduciary duties of our Board or any additional fiduciary duty by our Board or restricting or limiting the ability of stockholders to make proposals for inclusion in proxy materials related to executive compensation.
In voting on the frequency of future advisory votes on our executive compensation, stockholders may vote to have the vote occur every one, two or three years or abstain from voting. The period that receives the most votes from stockholders will be deemed to be the period selected by stockholders.
OUR BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE IN FAVOR OF HAVING FUTURE ADVISORY VOTES ON EXECUTIVE COMPENSATION OCCUR EVERY YEAR.
Proposal IV. Ratification of Appointment of Independent Auditors
By order of our Board of Directors | ||||||
People’s Republic of China | ||||||
April 27, 2017 |
IMPORTANT ANNUAL MEETING INFORMATION |
Electronic Voting Instructions | |
Available 24 hours a day, 7 days a week! | |
Instead of mailing your proxy, you may choose one of the voting methods outlined below to vote your proxy. | |
VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR. | |
Proxies submitted by the Internet or telephone must be received by 10:00 p.m., Eastern Time, on June 18, 2017. | |
Vote by Internet | |
● | Go towww.envisionreports.com/SOHU |
● | Or scan the QR code with your smartphone |
● | Follow the steps outlined on the secure website |
Vote by telephone | |
● | Call toll free 1-800-652-VOTE (8683) within the USA, US territories & Canada on a touch tone telephone |
● | Follow the instructions provided by the recorded message |
Using ablack inkpen, mark your votes with anXas shown in this example. Please do not write outside the designated areas. |
Annual Meeting Proxy Card |
▼IF YOU HAVE NOT VOTED VIA THE INTERNETOR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.▼ |
A | Proposals — | The Board of Directors recommends a voteFOR all the nominees listed, andFOR Proposals 2 and 4 and every YEAR for Proposal 3. |
1. | To elect three directors, who shall serve for a two-year term or until their earlier resignation or removal. Nominees: |
01 - Mr. Charles Huang | 02 - Dr. Dave Qi | 03 - Mr. Shi Wang |
☐ | Mark here to vote FOR all nominees | ☐ | Mark here toWITHHOLD vote from all nominees | ☐ | For AllEXCEPT- To withhold authority to vote for any nominee(s), write the name(s) of such nominee(s) below. | |||||
For | Against | Abstain | For | Against | Abstain | |||||||
2. | Advisory resolution approving our executive compensation | ☐ | ☐ | ☐ | 4. | Ratification of the appointment of PricewaterhouseCoopers Zhong Tian LLP as our independent auditors for the fiscal year ending December 31, 2017 | ☐ | ☐ | ☐ | |||
One Year | Two Years | Three Years | Abstain | |||||||||
3. | Advisory vote on the frequency of future advisory votes on our executive compensation | ☐ | ☐ | ☐ | ☐ | 5. | All other matters which may properly come before the Annual Meeting or any adjournment or postponement thereof | |||||
B | Non-Voting Items |
Change of Address— Please print new address below. | Comments— Please print your comments below. | |
C | Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below | |
NOTE: Please sign as your name(s) is (are) shown on the certificates to which the Proxy applies. When signing as attorney, executor, administrator, trustee or guardian, please give full title as such. If a corporation, please sign in full corporate name by president or other authorized officer. If a partnership or limited liability company, please sign in partnership or limited liability company name by authorized person. |
Date (mm/dd/yyyy) — Please print date below. | Signature 1 — Please keep signature within the box. | Signature 2 — Please keep signature within the box. | ||
// | ||||
02L5RB |
Important notice regarding the Internet availability of proxy materials for the Annual Meeting of Stockholders.
▼IF YOU HAVE NOT VOTED VIA THE INTERNETOR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.▼ |
Proxy — SOHU.COM INC. |
LEVEL 18, SOHU.COM MEDIA PLAZA
BLOCK 3, NO. 2 KEXUEYUAN SOUTH ROAD, HAIDIAN DISTRICT
BEIJING 100190, PEOPLE’S REPUBLIC OF CHINA
Proxy for the Annual Meeting of Stockholders – June 20, 2017 Beijing Time
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The person or entity signed on the reverse side of this proxy card hereby appoints Dr. Charles Zhang and Ms. Joanna Lv and each of them, as proxy or proxies for such person or entity, with full power of substitution, who may act by unanimous vote of said proxies or their substitutes as shall be present at the meeting, or, if only one be present, then the one shall have all the powers hereunder, to represent and to vote, as designated on the other side(if no direction is made, this Proxy will be voted FOR Proposals 1, 2, and 4 and is in favor of a frequency of every YEAR for future advisory votes on executive compensation),all of the shares of common stock, par value $0.001 per share, of Sohu.com Inc. standing in the name of such person or entity on April 24, 2017 at the Annual Meeting of Stockholders of Sohu.com Inc. to be held on Tuesday, June 20, 2017 at 10:00 a.m., Beijing time, and any adjournment thereof. In their discretion, the proxies are authorized to vote upon such other business as may properly come before the meeting.
(Please sign, date and return this proxy in the enclosed postage prepaid envelope).
(Continued and to be marked, dated and signed, on the other side)