Form SC 13E3 51JOB, INC. Filed by: 51JOB, INC.

 

Exhibit (b)-(3)

 

EQUITY COMMITMENT LETTER

 

June 21, 2021

 

Garnet Faith Limited

Address:

c/o Intertrust Corporate Services (Cayman) Limited
190 Elgin Avenue, George Town
Grand Cayman KY1-9005, Cayman Islands

 

Ladies and Gentlemen:

 

This letter agreement is being delivered by and sets forth the commitment of DCP Capital Partners II, L.P. (the “Sponsor”), on the terms and subject to the conditions contained herein, to purchase, directly or indirectly, certain equity interests of Garnet Faith Limited, an exempted company with limited liability incorporated under the Laws of the Cayman Islands (“Merger Sub”). It is contemplated that, pursuant to that certain Agreement and Plan of Merger, dated as of the date hereof (as amended, restated, supplemented or otherwise modified from time to time, the “Merger Agreement”), between 51job, Inc. (the “Company”) and Merger Sub, Merger Sub will merge with and into the Company (the “Merger”), with the Company surviving the Merger. Concurrently with the delivery of this letter agreement, RY Holdings Inc., RY Elevate Inc., 51 Elevate Limited and Ocean Link Partners II, L.P. (each, an “Other Sponsor”) are entering into letter agreements substantially identical to this letter agreement (each, an “Other Sponsor Equity Commitment Letter”) committing to invest, directly or indirectly, in Merger Sub. Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to such terms in the Merger Agreement. For the purpose of this letter agreement, the term “person” shall have the meaning given to it in Section 9.03 of the Merger Agreement.

 

1.              Equity Commitment.

 

(a)            This letter agreement confirms the commitment of the Sponsor, at or prior to the Effective Time, on the terms and subject to the conditions set forth herein, to purchase, or to cause the purchase of equity interests of Merger Sub and to pay, or cause to be paid to Merger Sub in immediately available funds an aggregate cash purchase price equal to US$348,924,021.18 (the “Equity Commitment”), which Merger Sub shall use for the purpose of funding, to the extent necessary to fund, such portion of the Merger Consideration and such other amounts required to be paid by Merger Sub pursuant to and in accordance with the Merger Agreement, together with related fees and expenses; provided that the Sponsor (together with its permitted assigns) shall not, under any circumstances, be obligated to contribute more than the Equity Commitment to Merger Sub and the aggregate amount of liability of the Sponsor hereunder shall not exceed the amount of the Equity Commitment (the “Cap”).

 

 

(b)            The Sponsor may effect the funding of the Equity Commitment directly or indirectly through one or more direct or indirect Subsidiaries of the Sponsor or any investment fund or vehicles sponsored, advised or managed by the investment manager of the Sponsor or any Affiliate thereof or any other investment fund or person that is a limited partner of the Sponsor or of an Affiliate of the Sponsor or other Affiliates of the Sponsor. The Sponsor will not be under any obligation under any circumstances to contribute more than the amount of the Equity Commitment to Merger Sub or any other person pursuant to the terms of this letter agreement.

 

2.              Conditions. The Equity Commitment shall be subject to (a) the satisfaction in full or waiver, if permissible (and in accordance with the Interim Investors Agreement), at or prior to the Closing, of each of the conditions set forth in Section 7.01 and Section 7.02 of the Merger Agreement (other than any conditions that by their nature are to be satisfied at the Closing but subject to the prior or substantially concurrent satisfaction of such conditions), (b) either the substantially contemporaneous consummation of the Closing or the obtaining by the Company in accordance with Section 9.08 of the Merger Agreement of a final and non-appealable order requiring Merger Sub to cause the Equity Financing to be funded and to effect the Closing, (c) the Debt Financing and/or the Alternative Financing (if applicable) having been funded or will be funded at the Closing in accordance with the terms thereof if the Equity Financing is funded at the Closing, and (d) the substantially contemporaneous funding to Merger Sub of the contributions contemplated by the Other Sponsor Equity Commitment Letters, which Merger Sub agrees shall not be modified, amended or altered in any manner adverse to the Sponsor without the Sponsor’s prior written consent, provided that the satisfaction or failure of the condition set forth in clause (d) shall not limit or impair the ability of Merger Sub or the Company to seek enforcement of the obligations of the Sponsor under and in accordance with this letter agreement, if (x) the Company is also seeking enforcement of the Other Sponsor Equity Commitment Letters or (y) each Other Sponsor has satisfied or will satisfy its obligations under its Other Sponsor Equity Commitment Letter.

 

3.            Limited Guarantee. Concurrently with the execution and delivery of this letter agreement, (i) the Sponsor is executing and delivering to the Company a limited guarantee related to certain payment obligations of Merger Sub under the Merger Agreement (the “Limited Guarantee”) and (ii) each of the Other Sponsors (except 51 Elevate Limited) and Recruit Holdings Co., Ltd. is executing and delivering to the Company a limited guarantee substantially identical to the Limited Guarantee (each, an “Other Limited Guarantee” and collectively, together with the Limited Guarantee, the “Limited Guarantees”) relating to certain payment obligations of Merger Sub under the Merger Agreement. Other than as set forth herein (including without limitation, the rights of the Company pursuant to Section 4) or with respect to the Retained Claims (as defined in the Limited Guarantee), (a) the Company’s remedies against the Sponsor under the Limited Guarantee shall be, and are intended to be, the sole and exclusive direct or indirect remedies available to the Company and the Guaranteed Party Related Persons (as defined in the Limited Guarantee) against the Sponsor or any of the Non-Recourse Parties (as defined in the Limited Guarantee) for any liability, loss, damage or recovery of any kind (including consequential, indirect or punitive damages, and whether at law, in equity or otherwise) arising out of or relating to this letter agreement or the Merger Agreement, or of the failure of any of the transactions contemplated by any such agreement to be consummated or otherwise in connection with any of the transactions contemplated hereby and thereby or in respect of any other document or theory of law or in equity, or in respect of any written or oral representations made or alleged to have been made in connection with any such agreement, whether at law, in equity, in contract, in tort or otherwise, (whether or not Merger Sub’s breach is caused by the Sponsor’s breach of its obligations under this letter agreement); and (b) the Company and the Guaranteed Party Related Persons (as defined in the Limited Guarantee) shall not have, and they are not intended to have, any right of recovery against the Sponsor or any of the Non-Recourse Parties in respect of any liabilities or obligations arising out of or relating to, this letter agreement or the Merger Agreement, including in the event Merger Sub breaches its obligations under the Merger Agreement and whether or not Merger Sub’s breach is caused by the Sponsor’s breach of its obligations under this letter agreement, except for claims of the Company against the Sponsor pursuant to and in accordance with the Limited Guarantee.

 

 

4.            Enforceability; Third-Party Beneficiary.

 

(a)            This letter agreement may only be enforced by Merger Sub (in its sole discretion); provided that, subject to Sections 4(b), 6 and 7, the Company shall be entitled to enforce, and is hereby expressly made a third-party beneficiary of this letter agreement with the right to enforce, the rights granted to Merger Sub to cause the Sponsor to fund the Equity Commitment in accordance with Section 1 if, and only if the conditions set forth in Section 2 are satisfied and the Company is entitled to seek specific performance pursuant to Section 9.08 of the Merger Agreement. None of Merger Sub’s or the Company’s creditors or any provider or source of the Financing shall have the right to enforce this letter agreement or to cause Merger Sub or the Company to enforce this letter agreement against the Sponsor.

 

(b)            Subject to the terms and conditions set forth herein, the Company shall be entitled to specifically enforce Merger Sub’s right to cause the Equity Commitment to be funded to Merger Sub solely to the extent permitted under Section 4(a) and the Company shall be a third party beneficiary for such purpose but not for any other purpose (including, without limitation, any claim for monetary damages hereunder or under the Merger Agreement). The Company hereby agrees that specific performance shall be its sole and exclusive remedy with respect to any breach by the Sponsor of this letter agreement and that the Company may not seek or accept any other form of relief that may be available for any such breach of this letter agreement (including monetary damages); provided, that, notwithstanding anything to the contrary, if the Company seeks specific performance for such breach of this letter agreement as permitted under Section 4(a), and a court of competent jurisdiction in a final, non-appealable determination as to the availability of specific performance does not specifically enforce any obligation of the Sponsor hereunder pursuant to any proceeding for specific performance brought against the Sponsor, then the Company shall have the right to seek the payments contemplated by, and subject to the terms and conditions of, Section 1 of the Limited Guarantee (subject to the limitations and conditions therein). In addition, the Company shall, and shall cause each of its Affiliates to, cause any proceeding still pending to be dismissed with prejudice upon the earlier of (i) the consummation of the Closing by Merger Sub or (ii) the payment of the Merger Sub Termination Fee pursuant to the Merger Agreement.

 

(c)            Notwithstanding anything to the contrary set forth herein, in no event shall the maximum amount of the liabilities of the Sponsor in the aggregate under this letter agreement exceed the Cap.

 

 

(d)            Notwithstanding the foregoing, if the Company or any of its Affiliates asserts in any proceeding that the Cap on the Sponsor’s liabilities hereunder or the Cap (as defined in each Other Sponsor Equity Commitment Letter) on any Other Sponsor’s liabilities is illegal, invalid or unenforceable in whole or in part, then (i) the obligations of the Sponsor under this letter agreement shall terminate ab initio and be null and void, (ii) if the Sponsor has previously made any payments under this letter agreement, it shall be entitled to recover such payments, and (iii) the Sponsor shall not have any liabilities or obligations to any person under this letter agreement.

 

(e)            Each party hereto acknowledges and agrees that (i) this letter agreement is not intended to, and does not, create any agency, partnership, fiduciary or joint venture, relationship, between or among any of the parties hereto, and neither this letter agreement nor any other document or agreement entered into by any party hereto relating to the subject matter hereof shall be construed to suggest otherwise, and (ii) the obligations of the Sponsor under this letter agreement are solely contractual in nature.

 

(f)             The parties hereto agree that their respective agreements and obligations set forth herein are solely for the benefit of the other party hereto and its respective successors and permitted assigns, in accordance with and subject to the terms of this letter agreement, and this letter agreement is not intended to, and does not, confer upon any person other than the parties hereto and their respective successors and permitted assigns any benefits, rights or remedies under or by reason of, or any rights to enforce or cause Merger Sub to enforce, the obligations set forth therein; provided that (i) the Company is a third-party beneficiary of this letter agreement to the extent and only to the extent of its rights specifically provided in Section 4(a) in accordance with, and subject to the terms of the Merger Agreement and this letter agreement; and (ii) the Non-Recourse Parties may rely upon and enforce the provisions of Section 3 and Section 12. Except as expressly provided in the foregoing sentence, nothing in this letter agreement, express or implied, is intended to confer upon any person other than Merger Sub or the Sponsor, any rights or remedies under or by reason of this letter agreement. In no event shall this letter agreement or the Equity Commitment to be funded hereunder be enforced by any person unless such person is also seeking enforcement of the Other Sponsor Equity Commitment Letters to the extent that any Other Sponsor has not performed in full its obligations under its Other Sponsor Equity Commitment Letter.

 

5.              No Modification; Entire Agreement. This letter agreement may not be amended or otherwise modified without the prior written consent of (i) Merger Sub and the Sponsor and (ii) if such amendment or modification (for the avoidance of doubt, including any amendment or modification of Section 11) would impact the Company’s rights as a third-party beneficiary of this letter agreement pursuant to Section 4(a), the Company. Together with the Merger Agreement (including any schedules, exhibits and annexes thereto and any other documents and instruments referred to thereunder), the Interim Investors Agreement, each Other Sponsor Equity Commitment Letter, the Limited Guarantee, each Other Guarantee (as defined in the Limited Guarantee), the Support Agreements and the Confidentiality Agreement by and between DCP Services Limited and the Company dated as of October 10, 2020, this letter agreement constitutes the sole agreement, and supersedes all prior agreements, understandings and statements, written or oral, between, the Sponsor or any of its Affiliates, on the one hand, and Merger Sub or any of its Affiliates, on the other hand, with respect to the transactions contemplated hereby. Each of the parties acknowledges that each party and its respective counsel have reviewed this letter agreement and that any rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this letter agreement.

 

 

6.              Governing Law. This letter agreement and all disputes or controversies arising out of or relating to this letter agreement or the transactions contemplated hereby shall be interpreted, construed and governed by and in accordance with the Laws of the State of New York without regard to the conflicts of law principles thereof.

 

7.              Dispute Resolution.

 

(a)            Any disputes, actions and proceedings against any party or arising out of or in any way relating to this letter agreement shall be submitted to the Hong Kong International Arbitration Centre (“HKIAC”) and resolved in accordance with the Arbitration Rules of HKIAC in force at the relevant time and as may be amended by this Section 7(a) (the “Rules”). The place of arbitration shall be Hong Kong. The official language of the arbitration shall be English and the arbitration tribunal shall consist of three arbitrators (each, an “Arbitrator”). The claimant(s), irrespective of number, shall nominate jointly one Arbitrator; the respondent(s), irrespective of number, shall nominate jointly one Arbitrator; and a third Arbitrator will be nominated jointly by the first two Arbitrators and shall serve as chairman of the arbitration tribunal. In the event the claimant(s) or respondent(s) or the first two Arbitrators shall fail to nominate or agree the joint nomination of an Arbitrator or the third Arbitrator within the time limits specified by the Rules, such Arbitrator shall be appointed promptly by the HKIAC. The arbitration tribunal shall have no authority to award punitive or other punitive-type damages. The award of the arbitration tribunal shall be final and binding upon the disputing parties. Any party to an award may apply to any court of competent jurisdiction for enforcement of such award and, for purposes of the enforcement of such award, the parties irrevocably and unconditionally submit to the jurisdiction of any court of competent jurisdiction and waive any defenses to such enforcement based on lack of personal jurisdiction or inconvenient forum.

 

(b)            Notwithstanding the foregoing, the parties hereto consent to and agree that in addition to any recourse to arbitration as set out in this Section 7, any party may, to the extent permitted under the rules and procedures of the HKIAC, seek an interim injunction or other form of relief from the HKIAC as provided for in its Rules. Such application shall also be governed by, and construed in accordance with, the laws of the State of New York.

 

8.              Waiver of Jury Trial.       EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS LETTER AGREEMENT AND ANY OF THE AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR OTHER TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HERETO CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE EITHER OF SUCH WAIVERS, (B) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVERS, (C) IT MAKES SUCH WAIVERS VOLUNTARILY, AND (D) IT HAS BEEN INDUCED TO ENTER INTO THIS LETTER AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8.

 

 

9.             Counterparts. This letter agreement may be executed and delivered (including by e-mail of PDF or scanned versions or by facsimile) in one or more counterparts, and by the parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement.

 

10.            Confidentiality. This letter agreement shall be treated as confidential and is being provided to Merger Sub solely in connection with the Merger Agreement and the transactions contemplated thereby. This letter agreement may not be used, circulated, quoted or otherwise referred to in any document by either party hereto, except with the prior written consent of the other party; provided, however, that each party hereto may disclose the existence and content of this letter agreement to the Company, to their respective officers, directors, employees, partners, members, investors, financing sources, advisors (including financial and legal advisors) and any representatives of the foregoing (collectively, “Representatives”), to the Other Sponsors and their respective Representatives and to the extent required by applicable Law, the applicable rules of any national securities exchange or in connection with any SEC filings relating to the Merger Agreement and the transactions contemplated thereby or in connection with any litigation relating to the Merger Agreement and the transactions contemplated thereby as permitted by or provided in the Merger Agreement and the Sponsor may disclose the existence and content of this letter agreement to any Non-Recourse Party which needs to know of the existence of this letter agreement and is subject to the confidentiality obligations substantially identical to the terms contained in this Section 10.

 

11.            Termination. This letter agreement and the obligation of the Sponsor to fund the Equity Commitment will terminate automatically and immediately upon the earliest to occur of (a) the valid termination of the Merger Agreement in accordance with its terms, (b) the Closing, at which time such obligation will be discharged but subject to the performance of such obligation, (c) the Company or any of its controlled Affiliates directly or indirectly taking affirmative steps to pursue remedies (including asserting a claim or initiate a proceeding) against the Sponsor under the Limited Guarantee or any Other Sponsor under any Other Guarantee, or (d) the Company or any of its controlled Affiliates directly or indirectly (i) asserting a claim or initiate a proceeding against the Merger Sub, the Sponsor or any Non-Recourse Party (as defined in the Limited Guarantee) in connection with or relating to this letter agreement, the Merger Agreement or any of the transactions contemplated under the Merger Agreement (other than a claim seeking an order of specific performance of the Sponsor’s obligation to make the Equity Commitment in the circumstances provided for in Section 4(a) or seeking specific performance pursuant to the Merger Agreement or the Other Sponsor Equity Commitment Letters), or (ii) asserting that the Cap on Sponsor’s aggregate liabilities hereunder or the Cap (as defined in each Other Sponsor Equity Commitment Letter) on any Other Sponsor’s liabilities is illegal, invalid or unenforceable in whole or in part. Upon termination of this letter agreement, all rights and obligations of the Sponsor hereunder with respect to the Equity Commitment shall terminate, and the Sponsor shall not have any further liabilities hereunder. Notwithstanding anything to the contrary in this letter agreement, the provisions set forth in this letter agreement that are for the benefit of any Non-Recourse Party (as defined in the Limited Guarantee) shall indefinitely survive any termination of this letter agreement.

 

 

12.            No Recourse. Notwithstanding anything that may be expressed or implied in this letter agreement or any document or instrument delivered in connection herewith, Merger Sub, by its acceptance of the benefits of the Equity Commitment provided herein, covenants, agrees and acknowledges that no person (other than the Sponsor or its successors or permitted assigns hereunder) shall have any liabilities or obligations hereunder or in connection with the transactions contemplated hereby and that, notwithstanding the fact that the Sponsor or any of its respective successors or permitted assigns may be partnerships, limited liability companies, corporations or other entities, Merger Sub has no rights of recovery against, and no recourse hereunder or under any document or instrument delivered in connection herewith or in respect of any oral representations made or alleged to be made in connection herewith or therewith shall be had against, any Non-Recourse Party, whether by or through attempted piercing of the corporate (or limited liability company or limited partnership) veil, by or through a claim (whether at law or equity or in tort, contract or otherwise), by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of any applicable Law; it being agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any Non-Recourse Party for any obligations or liabilities of the Sponsor or any of its successors or permitted assigns hereunder or any document or instrument delivered in connection herewith or in respect of any oral representation made or alleged to be made in connection herewith or therewith or for any proceeding (whether at law or equity or in tort, contract or otherwise) based on, in respect of, or by reason of such obligations or liabilities or their creation.

 

13.          Representations and Warranties. The Sponsor hereby represents and warrants to Merger Sub that:

 

(a)           it has all necessary organizational power and authority to execute and deliver this letter agreement and perform its obligations hereunder;

 

(b)          the execution, delivery and performance of this letter agreement by it has been duly and validly authorized and approved by all necessary limited partnership or corporate action (as applicable) by it;

 

(c)          this letter agreement has been duly and validly executed and delivered by the Sponsor and (assuming due execution and delivery of this letter agreement, the Merger Agreement and the Limited Guarantee by all parties hereto and thereto, as applicable) constitutes a valid and legally binding obligation of the Sponsor, enforceable against the Sponsor in accordance with the terms of this letter agreement (subject to (i) the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and (ii) general equitable principles (whether considered in a proceeding in equity or at law));

 

(d)          it will, at the Closing, have sufficient funds, available lines of credit, unfunded capital commitments that it is entitled to call to fulfill its Equity Commitment, or other sources of immediately available funds to fulfill its payment obligation for the sum of the Equity Commitment and all of its other unfunded contractually binding equity commitments that are then outstanding;

 

 

(e)            except for the applicable requirements of the Exchange Act, no action, consent, permit, authorization by, and no notice to or filing with, any governmental entity is required in connection with the execution, delivery or performance of this letter agreement by the Sponsor; and

 

(f)            the execution, delivery and performance of this letter agreement by the Sponsor do not (i) violate the organizational documents of the Sponsor, (ii) violate any applicable Law binding on the Sponsor or the assets of the Sponsor or (iii) conflict with any material agreement binding on the Sponsor.

 

14.            No Assignment. The Sponsor’s obligation to fund the Equity Commitment may not be assigned (whether by operation of law, merger, consolidation or otherwise) or delegated, except that the Sponsor may assign or delegate all or a portion of its obligations to fund the Equity Commitment to any of the Sponsor’s Affiliates, or any affiliated investment fund or investment vehicle sponsored, advised or managed by the general partner or the investment manager of the Sponsor or any of its Affiliates thereof (including any affiliated investment fund or investment vehicle to be set up after the date hereof that is sponsored, advised or managed by such Sponsor or any of its Affiliates as of such assignment); provided, any such assignment or delegation shall not relieve the Sponsor of its obligations under this letter agreement. Merger Sub may not assign its rights to any of its Affiliates or other entity owned directly or indirectly by the beneficial owners of Merger Sub, without the prior written consent of the Sponsor. The Company may not assign its rights without the prior written consent of Merger Sub and the Sponsor. Any transfer, assignment or delegation in violation of this Section 14 shall be null and void and of no force and effect.

 

15.            Interpretation. Headings are used for reference purposes only and do not affect the meaning or interpretation of this letter agreement. When a reference is made in this letter agreement to a Section, such reference shall be to a Section of this letter agreement unless otherwise indicated. All words used in this letter agreement will be construed to be of such gender or number as the circumstances require. The word “including” and words of similar import when used in this letter agreement will mean “including, without limitation,” unless otherwise specified. The words “hereof,” “herein” and “hereunder” and words of similar import when used in this letter agreement shall refer to this letter agreement as a whole and not to any particular provision of this letter agreement. The definitions contained in this letter agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term. Any agreement or instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein. References from or through any date shall mean, unless otherwise specified, from and including or through and including, respectively. The symbol “US$” refers to United States Dollars.

 

 

16.            Severability. Any term or provision of this letter agreement that is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of this letter agreement or affecting the validity or enforceability of any of the terms or provisions of this letter agreement in any other jurisdiction. If any provision of this letter agreement is so broad as to be unenforceable, the provision shall be interpreted to be only so broad as would be enforceable.

 

[Remainder of page intentionally left blank]

 

 

Sincerely,

 

For and on behalf of

DCP General Partner II, Limited

acting as general partner of

 DCP Capital Partners II. L.P.

 

By:	/s/ Julian Juul Wolhardt
Name:	Julian Juul Wolhardt
Title:	Director

 

[signature page to equity commitment letter]

 

 

Agreed to and accepted as of the date first written above:

 

Garnet Faith Limited

 

By:	/s/ Julian Juul Wolhardt
Name:	Julian Juul Wolhardt
Title:	Director

 

[signature page to equity commitment letter]

 

 

Exhibit (b)-(4)

 

EQUITY COMMITMENT LETTER

 

June 21, 2021

 

Garnet Faith Limited

Address:

c/o Intertrust Corporate Services (Cayman) Limited
190 Elgin Avenue, George Town
Grand Cayman KY1-9005, Cayman Islands

 

Ladies and Gentlemen:

 

This letter agreement is being delivered by and sets forth the commitment of Ocean Link Partners II, L.P. (the “Sponsor”), on the terms and subject to the conditions contained herein, to purchase, directly or indirectly, certain equity interests of Garnet Faith Limited, an exempted company with limited liability incorporated under the Laws of the Cayman Islands (“Merger Sub”). It is contemplated that, pursuant to that certain Agreement and Plan of Merger, dated as of the date hereof (as amended, restated, supplemented or otherwise modified from time to time, the “Merger Agreement”), between 51job, Inc. (the “Company”) and Merger Sub, Merger Sub will merge with and into the Company (the “Merger”), with the Company surviving the Merger. Concurrently with the delivery of this letter agreement, RY Holdings Inc., RY Elevate Inc., 51 Elevate Limited and DCP Capital Partners II, L.P. (each, an “Other Sponsor”) are entering into letter agreements substantially identical to this letter agreement (each, an “Other Sponsor Equity Commitment Letter”) committing to invest, directly or indirectly, in Merger Sub. Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to such terms in the Merger Agreement. For the purpose of this letter agreement, the term “person” shall have the meaning given to it in Section 9.03 of the Merger Agreement.

 

1.            Equity Commitment.

 

(a)          This letter agreement confirms the commitment of the Sponsor, at or prior to the Effective Time, on the terms and subject to the conditions set forth herein, to purchase, or to cause the purchase of equity interests of Merger Sub and to pay, or cause to be paid to Merger Sub in immediately available funds an aggregate cash purchase price equal to US$ 187,882,165.25 (the “Equity Commitment”), which Merger Sub shall use for the purpose of funding, to the extent necessary to fund, such portion of the Merger Consideration and such other amounts required to be paid by Merger Sub pursuant to and in accordance with the Merger Agreement, together with related fees and expenses; provided that the Sponsor (together with its permitted assigns) shall not, under any circumstances, be obligated to contribute more than the Equity Commitment to Merger Sub and the aggregate amount of liability of the Sponsor hereunder shall not exceed the amount of the Equity Commitment (the “Cap”).

 

 

(b)          The Sponsor may effect the funding of the Equity Commitment directly or indirectly through one or more direct or indirect Subsidiaries of the Sponsor or any investment fund or vehicles sponsored, advised or managed by the investment manager of the Sponsor or any Affiliate thereof or any other investment fund or person that is a limited partner of the Sponsor or of an Affiliate of the Sponsor or other Affiliates of the Sponsor. The Sponsor will not be under any obligation under any circumstances to contribute more than the amount of the Equity Commitment to Merger Sub or any other person pursuant to the terms of this letter agreement.

 

2.            Conditions. The Equity Commitment shall be subject to (a) the satisfaction in full or waiver, if permissible (and in accordance with the Interim Investors Agreement), at or prior to the Closing, of each of the conditions set forth in Section 7.01 and Section 7.02 of the Merger Agreement (other than any conditions that by their nature are to be satisfied at the Closing but subject to the prior or substantially concurrent satisfaction of such conditions), (b) either the substantially contemporaneous consummation of the Closing or the obtaining by the Company in accordance with Section 9.08 of the Merger Agreement of a final and non-appealable order requiring Merger Sub to cause the Equity Financing to be funded and to effect the Closing, (c) the Debt Financing and/or the Alternative Financing (if applicable) having been funded or will be funded at the Closing in accordance with the terms thereof if the Equity Financing is funded at the Closing, and (d) the substantially contemporaneous funding to Merger Sub of the contributions contemplated by the Other Sponsor Equity Commitment Letters, which Merger Sub agrees shall not be modified, amended or altered in any manner adverse to the Sponsor without the Sponsor’s prior written consent, provided that the satisfaction or failure of the condition set forth in clause (d) shall not limit or impair the ability of Merger Sub or the Company to seek enforcement of the obligations of the Sponsor under and in accordance with this letter agreement, if (x) the Company is also seeking enforcement of the Other Sponsor Equity Commitment Letters or (y) each Other Sponsor has satisfied or will satisfy its obligations under its Other Sponsor Equity Commitment Letter.

 

3.            Limited Guarantee. Concurrently with the execution and delivery of this letter agreement, (i) the Sponsor is executing and delivering to the Company a limited guarantee related to certain payment obligations of Merger Sub under the Merger Agreement (the “Limited Guarantee”) and (ii) each of the Other Sponsors (except 51 Elevate Limited) and Recruit Holdings Co., Ltd. is executing and delivering to the Company a limited guarantee substantially identical to the Limited Guarantee (each, an “Other Limited Guarantee” and collectively, together with the Limited Guarantee, the “Limited Guarantees”) relating to certain payment obligations of Merger Sub under the Merger Agreement. Other than as set forth herein (including without limitation, the rights of the Company pursuant to Section 4) or with respect to the Retained Claims (as defined in the Limited Guarantee), (a) the Company’s remedies against the Sponsor under the Limited Guarantee shall be, and are intended to be, the sole and exclusive direct or indirect remedies available to the Company and the Guaranteed Party Related Persons (as defined in the Limited Guarantee) against the Sponsor or any of the Non-Recourse Parties (as defined in the Limited Guarantee) for any liability, loss, damage or recovery of any kind (including consequential, indirect or punitive damages, and whether at law, in equity or otherwise) arising out of or relating to this letter agreement or the Merger Agreement, or of the failure of any of the transactions contemplated by any such agreement to be consummated or otherwise in connection with any of the transactions contemplated hereby and thereby or in respect of any other document or theory of law or in equity, or in respect of any written or oral representations made or alleged to have been made in connection with any such agreement, whether at law, in equity, in contract, in tort or otherwise, (whether or not Merger Sub’s breach is caused by the Sponsor’s breach of its obligations under this letter agreement); and (b) the Company and the Guaranteed Party Related Persons (as defined in the Limited Guarantee) shall not have, and they are not intended to have, any right of recovery against the Sponsor or any of the Non-Recourse Parties in respect of any liabilities or obligations arising out of or relating to, this letter agreement or the Merger Agreement, including in the event Merger Sub breaches its obligations under the Merger Agreement and whether or not Merger Sub’s breach is caused by the Sponsor’s breach of its obligations under this letter agreement, except for claims of the Company against the Sponsor pursuant to and in accordance with the Limited Guarantee.

 

 

4.            Enforceability; Third-Party Beneficiary.

 

(a)          This letter agreement may only be enforced by Merger Sub (in its sole discretion); provided that, subject to Sections 4(b), 6 and 7, the Company shall be entitled to enforce, and is hereby expressly made a third-party beneficiary of this letter agreement with the right to enforce, the rights granted to Merger Sub to cause the Sponsor to fund the Equity Commitment in accordance with Section 1 if, and only if the conditions set forth in Section 2 are satisfied and the Company is entitled to seek specific performance pursuant to Section 9.08 of the Merger Agreement. None of Merger Sub’s or the Company’s creditors or any provider or source of the Financing shall have the right to enforce this letter agreement or to cause Merger Sub or the Company to enforce this letter agreement against the Sponsor.

 

(b)          Subject to the terms and conditions set forth herein, the Company shall be entitled to specifically enforce Merger Sub’s right to cause the Equity Commitment to be funded to Merger Sub solely to the extent permitted under Section 4(a) and the Company shall be a third party beneficiary for such purpose but not for any other purpose (including, without limitation, any claim for monetary damages hereunder or under the Merger Agreement). The Company hereby agrees that specific performance shall be its sole and exclusive remedy with respect to any breach by the Sponsor of this letter agreement and that the Company may not seek or accept any other form of relief that may be available for any such breach of this letter agreement (including monetary damages); provided, that, notwithstanding anything to the contrary, if the Company seeks specific performance for such breach of this letter agreement as permitted under Section 4(a), and a court of competent jurisdiction in a final, non-appealable determination as to the availability of specific performance does not specifically enforce any obligation of the Sponsor hereunder pursuant to any proceeding for specific performance brought against the Sponsor, then the Company shall have the right to seek the payments contemplated by, and subject to the terms and conditions of, Section 1 of the Limited Guarantee (subject to the limitations and conditions therein). In addition, the Company shall, and shall cause each of its Affiliates to, cause any proceeding still pending to be dismissed with prejudice upon the earlier of (i) the consummation of the Closing by Merger Sub or (ii) the payment of the Merger Sub Termination Fee pursuant to the Merger Agreement.

 

(c)          Notwithstanding anything to the contrary set forth herein, in no event shall the maximum amount of the liabilities of the Sponsor in the aggregate under this letter agreement exceed the Cap.

 

 

(d)          Notwithstanding the foregoing, if the Company or any of its Affiliates asserts in any proceeding that the Cap on the Sponsor’s liabilities hereunder or the Cap (as defined in each Other Sponsor Equity Commitment Letter) on any Other Sponsor’s liabilities is illegal, invalid or unenforceable in whole or in part, then (i) the obligations of the Sponsor under this letter agreement shall terminate ab initio and be null and void, (ii) if the Sponsor has previously made any payments under this letter agreement, it shall be entitled to recover such payments, and (iii) the Sponsor shall not have any liabilities or obligations to any person under this letter agreement.

 

(e)          Each party hereto acknowledges and agrees that (i) this letter agreement is not intended to, and does not, create any agency, partnership, fiduciary or joint venture, relationship, between or among any of the parties hereto, and neither this letter agreement nor any other document or agreement entered into by any party hereto relating to the subject matter hereof shall be construed to suggest otherwise, and (ii) the obligations of the Sponsor under this letter agreement are solely contractual in nature.

 

(f)           The parties hereto agree that their respective agreements and obligations set forth herein are solely for the benefit of the other party hereto and its respective successors and permitted assigns, in accordance with and subject to the terms of this letter agreement, and this letter agreement is not intended to, and does not, confer upon any person other than the parties hereto and their respective successors and permitted assigns any benefits, rights or remedies under or by reason of, or any rights to enforce or cause Merger Sub to enforce, the obligations set forth therein; provided that (i) the Company is a third-party beneficiary of this letter agreement to the extent and only to the extent of its rights specifically provided in Section 4(a) in accordance with, and subject to the terms of the Merger Agreement and this letter agreement; and (ii) the Non-Recourse Parties may rely upon and enforce the provisions of Section 3 and Section 12. Except as expressly provided in the foregoing sentence, nothing in this letter agreement, express or implied, is intended to confer upon any person other than Merger Sub or the Sponsor, any rights or remedies under or by reason of this letter agreement. In no event shall this letter agreement or the Equity Commitment to be funded hereunder be enforced by any person unless such person is also seeking enforcement of the Other Sponsor Equity Commitment Letters to the extent that any Other Sponsor has not performed in full its obligations under its Other Sponsor Equity Commitment Letter.

 

5.            No Modification; Entire Agreement. This letter agreement may not be amended or otherwise modified without the prior written consent of (i) Merger Sub and the Sponsor and (ii) if such amendment or modification (for the avoidance of doubt, including any amendment or modification of Section 11) would impact the Company’s rights as a third-party beneficiary of this letter agreement pursuant to Section 4(a), the Company. Together with the Merger Agreement (including any schedules, exhibits and annexes thereto and any other documents and instruments referred to thereunder), the Interim Investors Agreement, each Other Sponsor Equity Commitment Letter, the Limited Guarantee, each Other Guarantee (as defined in the Limited Guarantee), the Support Agreements and the Confidentiality Agreement by and between Ocean Link Partners II Limited and the Company dated as of October 10, 2020, this letter agreement constitutes the sole agreement, and supersedes all prior agreements, understandings and statements, written or oral, between, the Sponsor or any of its Affiliates, on the one hand, and Merger Sub or any of its Affiliates, on the other hand, with respect to the transactions contemplated hereby. Each of the parties acknowledges that each party and its respective counsel have reviewed this letter agreement and that any rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this letter agreement.

 

 

6.            Governing Law. This letter agreement and all disputes or controversies arising out of or relating to this letter agreement or the transactions contemplated hereby shall be interpreted, construed and governed by and in accordance with the Laws of the State of New York without regard to the conflicts of law principles thereof.

 

7.            Dispute Resolution.

 

(a)          Any disputes, actions and proceedings against any party or arising out of or in any way relating to this letter agreement shall be submitted to the Hong Kong International Arbitration Centre (“HKIAC”) and resolved in accordance with the Arbitration Rules of HKIAC in force at the relevant time and as may be amended by this Section 7(a) (the “Rules”). The place of arbitration shall be Hong Kong. The official language of the arbitration shall be English and the arbitration tribunal shall consist of three arbitrators (each, an “Arbitrator”). The claimant(s), irrespective of number, shall nominate jointly one Arbitrator; the respondent(s), irrespective of number, shall nominate jointly one Arbitrator; and a third Arbitrator will be nominated jointly by the first two Arbitrators and shall serve as chairman of the arbitration tribunal. In the event the claimant(s) or respondent(s) or the first two Arbitrators shall fail to nominate or agree the joint nomination of an Arbitrator or the third Arbitrator within the time limits specified by the Rules, such Arbitrator shall be appointed promptly by the HKIAC. The arbitration tribunal shall have no authority to award punitive or other punitive-type damages. The award of the arbitration tribunal shall be final and binding upon the disputing parties. Any party to an award may apply to any court of competent jurisdiction for enforcement of such award and, for purposes of the enforcement of such award, the parties irrevocably and unconditionally submit to the jurisdiction of any court of competent jurisdiction and waive any defenses to such enforcement based on lack of personal jurisdiction or inconvenient forum.

 

(b)          Notwithstanding the foregoing, the parties hereto consent to and agree that in addition to any recourse to arbitration as set out in this Section 7, any party may, to the extent permitted under the rules and procedures of the HKIAC, seek an interim injunction or other form of relief from the HKIAC as provided for in its Rules. Such application shall also be governed by, and construed in accordance with, the laws of the State of New York.

 

8.            Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS LETTER AGREEMENT AND ANY OF THE AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR OTHER TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HERETO CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE EITHER OF SUCH WAIVERS, (B) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVERS, (C) IT MAKES SUCH WAIVERS VOLUNTARILY, AND (D) IT HAS BEEN INDUCED TO ENTER INTO THIS LETTER AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8.

 

 

9.            Counterparts. This letter agreement may be executed and delivered (including by e-mail of PDF or scanned versions or by facsimile) in one or more counterparts, and by the parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement.

 

10.          Confidentiality. This letter agreement shall be treated as confidential and is being provided to Merger Sub solely in connection with the Merger Agreement and the transactions contemplated thereby. This letter agreement may not be used, circulated, quoted or otherwise referred to in any document by either party hereto, except with the prior written consent of the other party; provided, however, that each party hereto may disclose the existence and content of this letter agreement to the Company, to their respective officers, directors, employees, partners, members, investors, financing sources, advisors (including financial and legal advisors) and any representatives of the foregoing (collectively, “Representatives”), to the Other Sponsors and their respective Representatives and to the extent required by applicable Law, the applicable rules of any national securities exchange or in connection with any SEC filings relating to the Merger Agreement and the transactions contemplated thereby or in connection with any litigation relating to the Merger Agreement and the transactions contemplated thereby as permitted by or provided in the Merger Agreement and the Sponsor may disclose the existence and content of this letter agreement to any Non-Recourse Party which needs to know of the existence of this letter agreement and is subject to the confidentiality obligations substantially identical to the terms contained in this Section 10.

 

11.          Termination. This letter agreement and the obligation of the Sponsor to fund the Equity Commitment will terminate automatically and immediately upon the earliest to occur of (a) the valid termination of the Merger Agreement in accordance with its terms, (b) the Closing, at which time such obligation will be discharged but subject to the performance of such obligation, (c) the Company or any of its controlled Affiliates directly or indirectly taking affirmative steps to pursue remedies (including asserting a claim or initiate a proceeding) against the Sponsor under the Limited Guarantee or any Other Sponsor under any Other Guarantee, or (d) the Company or any of its controlled Affiliates directly or indirectly (i) asserting a claim or initiate a proceeding against the Merger Sub, the Sponsor or any Non-Recourse Party (as defined in the Limited Guarantee) in connection with or relating to this letter agreement, the Merger Agreement or any of the transactions contemplated under the Merger Agreement (other than a claim seeking an order of specific performance of the Sponsor’s obligation to make the Equity Commitment in the circumstances provided for in Section 4(a) or seeking specific performance pursuant to the Merger Agreement or the Other Sponsor Equity Commitment Letters), or (ii) asserting that the Cap on Sponsor’s aggregate liabilities hereunder or the Cap (as defined in each Other Sponsor Equity Commitment Letter) on any Other Sponsor’s liabilities is illegal, invalid or unenforceable in whole or in part. Upon termination of this letter agreement, all rights and obligations of the Sponsor hereunder with respect to the Equity Commitment shall terminate, and the Sponsor shall not have any further liabilities hereunder. Notwithstanding anything to the contrary in this letter agreement, the provisions set forth in this letter agreement that are for the benefit of any Non-Recourse Party (as defined in the Limited Guarantee) shall indefinitely survive any termination of this letter agreement.

 

 

12.          No Recourse. Notwithstanding anything that may be expressed or implied in this letter agreement or any document or instrument delivered in connection herewith, Merger Sub, by its acceptance of the benefits of the Equity Commitment provided herein, covenants, agrees and acknowledges that no person (other than the Sponsor or its successors or permitted assigns hereunder) shall have any liabilities or obligations hereunder or in connection with the transactions contemplated hereby and that, notwithstanding the fact that the Sponsor or any of its respective successors or permitted assigns may be partnerships, limited liability companies, corporations or other entities, Merger Sub has no rights of recovery against, and no recourse hereunder or under any document or instrument delivered in connection herewith or in respect of any oral representations made or alleged to be made in connection herewith or therewith shall be had against, any Non-Recourse Party, whether by or through attempted piercing of the corporate (or limited liability company or limited partnership) veil, by or through a claim (whether at law or equity or in tort, contract or otherwise), by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of any applicable Law; it being agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any Non-Recourse Party for any obligations or liabilities of the Sponsor or any of its successors or permitted assigns hereunder or any document or instrument delivered in connection herewith or in respect of any oral representation made or alleged to be made in connection herewith or therewith or for any proceeding (whether at law or equity or in tort, contract or otherwise) based on, in respect of, or by reason of such obligations or liabilities or their creation.

 

13.          Representations and Warranties. The Sponsor hereby represents and warrants to Merger Sub that:

 

(a)          it has all necessary organizational power and authority to execute and deliver this letter agreement and perform its obligations hereunder;

 

(b)          the execution, delivery and performance of this letter agreement by it has been duly and validly authorized and approved by all necessary limited partnership or corporate action (as applicable) by it;

 

(c)          this letter agreement has been duly and validly executed and delivered by the Sponsor and (assuming due execution and delivery of this letter agreement, the Merger Agreement and the Limited Guarantee by all parties hereto and thereto, as applicable) constitutes a valid and legally binding obligation of the Sponsor, enforceable against the Sponsor in accordance with the terms of this letter agreement (subject to (i) the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and (ii) general equitable principles (whether considered in a proceeding in equity or at law));

 

(d)          it will, at the Closing, have sufficient funds, available lines of credit, unfunded capital commitments that it is entitled to call to fulfill its Equity Commitment, or other sources of immediately available funds to fulfill its payment obligation for the sum of the Equity Commitment and all of its other unfunded contractually binding equity commitments that are then outstanding;

 

 

(e)          except for the applicable requirements of the Exchange Act, no action, consent, permit, authorization by, and no notice to or filing with, any governmental entity is required in connection with the execution, delivery or performance of this letter agreement by the Sponsor; and

 

(f)           the execution, delivery and performance of this letter agreement by the Sponsor do not (i) violate the organizational documents of the Sponsor, (ii) violate any applicable Law binding on the Sponsor or the assets of the Sponsor or (iii) conflict with any material agreement binding on the Sponsor.

 

14.          No Assignment. The Sponsor’s obligation to fund the Equity Commitment may not be assigned (whether by operation of law, merger, consolidation or otherwise) or delegated, except that the Sponsor may assign or delegate all or a portion of its obligations to fund the Equity Commitment to any of the Sponsor’s Affiliates, or any affiliated investment fund or investment vehicle sponsored, advised or managed by the general partner or the investment manager of the Sponsor or any of its Affiliates thereof (including any affiliated investment fund or investment vehicle to be set up after the date hereof that is sponsored, advised or managed by such Sponsor or any of its Affiliates as of such assignment); provided, any such assignment or delegation shall not relieve the Sponsor of its obligations under this letter agreement. Merger Sub may not assign its rights to any of its Affiliates or other entity owned directly or indirectly by the beneficial owners of Merger Sub, without the prior written consent of the Sponsor. The Company may not assign its rights without the prior written consent of Merger Sub and the Sponsor. Any transfer, assignment or delegation in violation of this Section 14 shall be null and void and of no force and effect.

 

15.          Interpretation. Headings are used for reference purposes only and do not affect the meaning or interpretation of this letter agreement. When a reference is made in this letter agreement to a Section, such reference shall be to a Section of this letter agreement unless otherwise indicated. All words used in this letter agreement will be construed to be of such gender or number as the circumstances require. The word “including” and words of similar import when used in this letter agreement will mean “including, without limitation,” unless otherwise specified. The words “hereof,” “herein” and “hereunder” and words of similar import when used in this letter agreement shall refer to this letter agreement as a whole and not to any particular provision of this letter agreement. The definitions contained in this letter agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term. Any agreement or instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein. References from or through any date shall mean, unless otherwise specified, from and including or through and including, respectively. The symbol “US$” refers to United States Dollars.

 

16.          Severability. Any term or provision of this letter agreement that is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of this letter agreement or affecting the validity or enforceability of any of the terms or provisions of this letter agreement in any other jurisdiction. If any provision of this letter agreement is so broad as to be unenforceable, the provision shall be interpreted to be only so broad as would be enforceable.

 

[Remainder of page intentionally left blank]

 

 

Sincerely,

 

Ocean Link Partners II, L.P.

By: Ocean Link Partners II GP, L.P., its general partner

By: Ocean Link Partners II GP Limited, its general partner  

 

 

By:	/s/ Tianyi Jiang
Name: Tianyi Jiang
Title: Director

 

[signature page to equity commitment letter]

 

 

Agreed to and accepted as of the date first written above:

 

Garnet Faith Limited

 

 

By:	/s/ Julian Juul Wolhardt
Name: Julian Juul Wolhardt
Title: Director

 

[signature page to equity commitment letter]

 

 

Exhibit (c)-(2)

 

Exhibit 99.6 Confidential 51job, Inc. Fairness Analysis Presented to the Special Committee of Independent Directors June 21, 2021 The information contained herein is of a confidential nature and is intended for the use of the persons or firm to whom it is furnished by us. Reproduction, publication, or dissemination of any portion hereof may not be made without prior approval of Kroll, LLC.

 

The following pages contain materials that are being provided by Duff & Phelps, A Kroll Business operating as Kroll, LLC (“Duff & Phelps”) to the special committee of independent directors (the “Special Committee”) of the board of directors (the “Board of Directors”) (solely in its capacity as the Special Committee) of 51job, Inc. (the “Company”) in the context of a meeting of the Special Committee held to consider the Proposed Transaction (as defined herein). The accompanying materials are, and any Opinion (as defined herein) will be, compiled and presented on a confidential basis, solely for the use and benefit of the Special Committee in connection with its evaluation of the Proposed Transaction and may not be, in whole or in part, distributed to any other party, publicly disclosed, or relied upon for any other purpose without the prior written consent of Duff & Phelps or as otherwise provided in the engagement letter among Duff & Phelps, the Company, and the Special Committee. Because these materials were prepared for use in the context of an oral presentation to the Special Committee, whose members are familiar with the business and affairs of the Company, neither Duff & Phelps nor any of its respective legal or financial advisors or accountants, take any responsibility for the accuracy or completeness of any of the accompanying materials if used by persons other than the Special Committee. These materials are not intended to represent an Opinion and shall not be treated, construed, used or relied upon in any way as an Opinion. These materials are intended to serve as discussion materials for the Special Committee and as a summary of the basis upon which Duff & Phelps may render an Opinion, and are incomplete without reference to, and should be viewed solely in conjunction with, the discussion between Duff & Phelps and the Special Committee. The accompanying material does not, and any Opinion provided by Duff & Phelps would not: (i) address the merits of the underlying business decision to enter into the Proposed Transaction versus any alternative strategy or transaction; (ii) constitute a recommendation as to how the Special Committee, the Board of Directors or any other person (including security holders of the Company) should vote or act with respect to any matters relating to the Proposed Transaction, or whether to proceed with the Proposed Transaction or any related transaction; or (iii) create any fiduciary duty on the part of Duff & Phelps to any party. The information utilized in preparing this presentation was obtained from the Company and from public sources under the assumption that they are complete and accurate as of the date of provision. Duff & Phelps did not independently verify such information. Any estimates and forecasts contained herein have been prepared by or are based on discussions with the senior management of the Company and involve numerous and significant subjective determinations, which may or may not prove to be correct. No representation or warranty, expressed or implied, is made as to the accuracy or completeness of such information and nothing contained herein is, or shall be relied upon as, a representation or warranty, whether as to the past or the future. No selected company or selected transaction used in our analysis is directly comparable to the Company or the Proposed Transaction.

 

Introduction and Transaction Overview Valuation Analysis Discounted Cash Flow Analysis Selected Public Companies / M&A Transactions Analysis

 

Introduction and Transaction Overview

 

The Engagement Duff & Phelps was retained by the Company to serve as independent financial advisor to the Special Committee (solely in its capacity as such). Specifically, Duff & Phelps has been asked to provide an opinion (the “Opinion”) as to the fairness, from a financial point of view, to (i) the holders of common shares, par value US$0.0001 per share, of the Company (each, a “Share” or, collectively, the “Shares”), other than the Excluded Shares, the Continuing Shares, the Dissenting Shares and Shares represented by ADSs (each as defined below), and (ii) the holders of American Depositary Shares of the Company, each representing one Share (each, an “ADS” and collectively, “ADSs”), other than ADSs representing the Excluded Shares and the Continuing Shares, of the Merger Consideration (as defined below) to be received by such holders in the Proposed Transaction (as defined below) (without giving effect to any impact of the Proposed Transaction on any particular holder of Shares or ADSs other than in its capacity as a holder of Shares or ADSs). The Proposed Transaction It is Duff & Phelps’ understanding that the Company and Garnet Faith Limited, an exempted company with limited liability incorporated under the laws of the Cayman Islands (“Merger Sub”), propose to enter into an Agreement and Plan of Merger (the “Merger Agreement”), dated as of the date hereof, the latest draft of which Duff & Phelps has reviewed is dated as of June 21, 2021. Pursuant to the Merger Agreement, among other things, Merger Sub will be merged with and into the Company and cease to exist, with the Company surviving the merger. In connection with such merger, (i) each Share issued and outstanding immediately prior to the Effective Time (other than the Excluded Shares, the Continuing Shares, the Dissenting Shares and Shares represented by ADSs) shall be cancelled and cease to exist in exchange for the right to receive US$79.05 in cash per Share without interest (the “Per Share Merger Consideration”) and (ii) each ADS issued and outstanding immediately prior to the Effective Time (other than ADSs representing the Excluded Shares and the Continuing Shares), together with the Shares represented by such ADSs, shall be cancelled and cease to exist in exchange for the right to receive US$79.05 in cash per ADS without interest (the “Per ADS Merger Consideration”, and together with the Per Share Merger Consideration, the “Merger Consideration”) (collectively, the “Proposed Transaction”). The terms and conditions of the Proposed Transaction are more fully set forth in the Merger Agreement. For purposes of the Opinion, (i) “Excluded Shares” shall mean, collectively, (a) Shares (including Shares represented by ADSs) held by the Company or any of its Subsidiaries and (b) Shares (including ADSs corresponding to such Shares) held by the Depositary and reserved for issuance and allocation pursuant to the Company Share Plans; and (ii) “Effective Time”, “Continuing Shares”, “Dissenting Shares”, “Subsidiaries”, “Depositary”, and “Company Share Plans” shall have the meanings set forth in the Merger Agreement.

 

Duff & Phelps has made such reviews, analyses and inquiries as it has deemed necessary and appropriate under the circumstances. Duff & Phelps also took into account its assessment of general economic, market and financial conditions, as well as its experience in securities and business valuation, in general, and with respect to similar transactions, in particular. Duff & Phelps’ procedures, investigations, and financial analysis with respect to the preparation of its analysis included, but were not limited to, the items summarized below: Reviewed the following documents: The Company’s annual reports and audited financial statements on Form 20-F filed with the Securities and Exchange Commission (“SEC”) for the years ended December 31, 2017 through December 31, 2020 and the Company’s unaudited interim financial statements for the three months ended March 31, 2019 and March 31, 2020 included in the Company’s Form 6-K filed with the SEC; The Company’s unaudited interim financial statements for the three months ended March 31, 2021, provided by the management of the Company; Certain unaudited and segment financial information for the Company for the years ended December 31, 2017 through December 31, 2020 and for the three months ended March 31, 2019, March 31, 2020 and March 31, 2021, each provided by the management of the Company; A detailed financial projection model for the Company for the years ending December 31, 2021 through December 31, 2025, prepared and provided to Duff & Phelps by the management of the Company, upon which Duff & Phelps has relied, with the Company’s and the Special Committee’s consent, in performing its analysis (collectively, the “Management Projections”); Other internal documents relating to the history, current operations, and probable future outlook of the Company, provided to Duff & Phelps by the management of the Company; A letter dated June 16, 2021 from the management of the Company, which made certain representations as to historical financial information for the Company, the Management Projections and the underlying assumptions of such projections (the “Management Representation Letter”); and A draft of the Merger Agreement dated as of June 21, 2021; A draft of an Interim Investors Agreement by and among Merger Sub, Recruit Holdings Co., Ltd. (“Recruit”) and the other parties thereto, dated as of June 21, 2021; A draft of a Support Agreement by and among Merger Sub and the other parties listed as “Continuing Shareholders” in Schedule A thereto, dated as of June 21, 2021; and A draft of a Support Agreement by and among Merger Sub, Recruit and the other parties thereto, dated as of June 21, 2021 (the Merger Agreement together with Interim Investors Agreement and Support Agreements, collectively, the “Transaction Documents”).

 

Discussed the information referred to above and the background and other elements of the Proposed Transaction with the management of the Company; Discussed with the management of the Company its plans and intentions with respect to the management and operation of the Company’s business; Reviewed the historical trading price and trading volume of the ADSs and the publicly traded securities of certain other companies that Duff & Phelps deemed relevant; Performed certain valuation and comparative analyses using generally accepted valuation and analytical techniques including a discounted cash flow analysis, an analysis of selected public companies that Duff & Phelps deemed relevant, and an analysis of selected transactions that Duff & Phelps deemed relevant; and Conducted such other analyses and considered such other factors as Duff & Phelps deemed appropriate.

 

51job, Inc. - Ownership Current ShareholdersADSs (1)% of Ownership

 

51job, Inc. - Trading History September 18, 2019 to June 18, 2021 Offer Price Premium Relative to: $95.00 $90.00 March 17, 2020 51job reported Q4'19 financial results. The Company reported total revenue of USD163.1 million and net income of USD35.6 million for the three months ended December 31, 2019. May 8, 2020 51job reported Q1'20 financial results. The Company reported total revenue of USD111.7 million and net income of USD28.5 million for the three months ended March 31, 2020. August 11, 2020 51job reported Q2'20 financial results. The Company reported total revenue of USD117.3 million and net income of USD52.8 million for the three months ended June 30, 2020. September 17, 2020 November 20, 2020 Current (6/18/21) One Day Prior 30-Day VWAP (1) 60-Day VWAP (1) Day VWAP (1) May 4, 2021 $74.65 $68.12 $67.07 $68.13 $66.53 5.9% 16.0% 17.9% 16.0% 18.8% 1,400 1,200 $85.00 $80.00 51job received a preliminary non-binding proposal letter from DCP Capital Partners, L.P. to acquire all of the outstanding common shares of the Company for USD79.05 per common share in cash. 51job reported Q3'20 financial results. The Company reported total revenue of USD133.5 million and net income of USD24.2 million for the three months ended September 30,2020. 51job received an updated non-binding proposal letter from from DCP Services Limited, Ocean Link Partners Limited, and Mr. Rick Yan to acquire all of the outstanding common shares of the Company for USD79.05 per common share in cash. Volume (thousands) Per ADS Price 800 $70.00 $65.00 $60.00 November 15, 2019 51job reported Q3'20 financial results. The Company reported total revenue of USD138.4 million and net income of USD41.8 million for the three months ended September 30, 2019. March 19, 2021 51job reported Q4'20 financial results. The Company reported total revenue of USD178.3 million and net income of USD50.9 million for the three months ended December 31, 2020. 600 400 $55.00 200 $50.000 VolumePrice30-day Trailing VWAP60-day Trailing VWAP90-day Trailing VWAPOffer Trailing Volume Weighted Average Price (VWAP) Prior to Offer at September 17, 2020. Source: Capital IQ, SEC filings, press releases.

 

51job, Inc. - Offe r Price Pre mium Re lative To51job, Inc. - Implie d Multiple s (USD in millions, except per ADS data) ADSImplied Price Premium Fully Diluted ADSs Issued and Outstanding (millions) 71.7 Offer $79.05 ays trailing VWAP prior to September 17, 2020$68.1316.0% Offer Price$79.05 Implied Offer Multiples: EV / LTM EBITDA $149 24.2x EV / 2021 EBITDA $111 32.5x EV / 2022 EBITDA $151 23.5x EV / 2023 EBITDA $197 17.7x EV / LTM Revenue $588 6.14x ADS price as of 6/18/21 $74.65 5.9% One-day prior (9/16/20) $68.12 16.0% One-week prior (9/10/20) $66.04 19.7% 30-days trailing VWAP prior to September 17, 2020$67.0717.9% 90-days trailing VWAP prior to September 17, 2020 $66.53 18.8% Less: Proceeds from Exercise of Options(245.7) Less: Cash and Cash Equivalents (1)(1,555.4) Less: Long-term Investments (2)(229.8) Less: Prepayment for Office Building (3)(62.0) Plus: Non-controlling Interests31.7 Implied Enterprise Value$3,608.6 Note: Balance sheet data and LTM as of March 31, 2021. Financial performance metrics presented are adjusted to exclude non-recurring income and expenses and public company costs. Reflects a 10% withholding tax discount on the onshore balance. Reflects book value of investments as of March 31, 2021, per Company management; reflects a 10% withholding tax discount on onshore investments. Reflects a prepayment for the purchase of an office building pending government approval, per Company management.

 

Valuation Range Conclusions (RMB in thousands, except per ADS values or otherwise noted) Discounted Cash Flow Analysis Selected Public Companies / M&A Transactions Analysis ￥19,360,000 ￥21,770,000 -￥27,160,000 -￥26,720,000 Enterprise Value Range ￥20,570,000 -￥26,940,000 Plus: Proceeds from Exercise of Options 1,585,560 -1,585,560 Plus: Cash and Cash Equivalents (1) 10,037,272 -10,037,272 Plus: Long-term Investments (2) 1,483,091 -1,483,091 Plus: Prepayment (3) 400,000 -400,000 Less: Non-controlling Interests (204,580) -(204,580) Equity Value Range ￥33,871,342 -￥40,241,342 Fully Diluted ADSs Issued and Outstanding 71,724,169 -71,724,169 Value Per ADS Range (RMB) ￥472.24 -￥561.06 RMB to USD FX rate (as of 6/18/2021) 6.45 -6.45 Offer Price Value Per ADS Range (USD) $73.18 -$86.94 $79.05 Implied Valuation Multiples Note: Balance sheet data and LTM as of March 31, 2021. Financial performance metrics presented are adjusted to exclude non-recurring income and expenses and public company costs. Reflects a 10% withholding tax discount on the onshore balance. Reflects book value of investments as of March 31, 2021, per Company management; reflects a 10% withholding tax discount on onshore investments. Reflects a prepayment for the purchase of an office building pending government approval, per Company management.

 

$79.05 Offer Price Discounted Cash Flow Analysis $70.57 $87.42 Selected Public Companies / M&A Transactions Analysis $75.77 $86.47 Concluded Range $73.18 $86.94 Value Per ADS (USD) $60.00$65.00$70.00$75.00$80.00$85.00$90.00$95.00$100.00

 

Valuation Analysis

 

Historical and Projected Financial Performance (RMB in thousands) YTDYTDLTMMa na ge me nt Proje ctions 2017A2018A2019A2020A3/31/20203/31/20213/31/20212021P2022P2023P2024P2025P Adjusted EBITDA￥1,028,753 ￥1,428,269 ￥1,504,959 ￥1,127,210￥197,729￥31,903￥961,383￥716,856￥989,706 ￥1,319,275 ￥1,676,752 ￥2,081,099 Purchase of Fixed Assets￥23,655￥87,053￥25,919￥47,327￥7,367￥6,012￥45,972￥50,000￥50,000￥75,000￥75,000￥100,000 Net working capital as of March 31, 2021 excludes RMB 400 million prepayment for the purchase of an office building pending government approval. Note: Financial performance metrics presented are adjusted to exclude non-recurring income and expenses and public company costs. Source: Company filings, the management of the Company.

 

Discounted Cash Flow Methodology Duff & Phelps performed a discounted cash flow analysis of the projected unlevered free cash flows. Unlevered free cash flow is defined as cash generated by the business that is available to either reinvest or to distribute to security holders. Projected free cash flows are discounted to the present using a discount rate which reflects their relative risk. The discount rate is equivalent to the rate of return that security holders could expect to realize on alternative investment opportunities with similar risk profiles. Discounted Cash Flow Key Assumptions Duff & Phelps utilized and relied upon the Management Projections for the fiscal years ending December 31, 2021 through 2025 (excluding public company expenses, as provided by the management of the Company), discussions with the management of the Company, and a review of the Company’s historical performance and other factors to develop the DCF analysis. Beyond the projection period, Duff & Phelps estimated the “terminal value” using a perpetuity formula. Duff & Phelps discounted the resulting free cash flows and terminal value using a weighted average cost of capital range of 10.0% to 12.0%, derived from the Capital Asset Pricing Model. The following is a summary of the Management Projections utilized in the discounted cash flow analysis: Net revenue increases at a compound annual growth rate (“CAGR”) of 12.5% from 2020 to 2025. EBITDA increases at a CAGR of 13.0% from 2020 to 2025. EBITDA margin averages 24.8% from 2021 to 2025. Total purchase of fixed assets and purchases of intangible assets averages 1.8% of net revenue from 2021 to 2025. Net working capital averages -48.1% of net revenue from 2021 to 2025.

 

Discounted Cash Flow Analysis (RMB in thousands) Terminal LTM2021P2022P2023P2024P2025PYear Enterprise Value RangeLowHigh Implied Valuation Multiples (1) Prior to application of 10% dividend withholding tax, which is calculated based on levered cash flows and discounted separately at the cost of equity derived in the WACC calculation and included in the concluded enterprise value range. Note: LTM as of March 31, 2021. Financial performance metrics presented are adjusted to exclude non-recurring income and expenses and public company costs.

 

Selected Public Companies Analysis Duff & Phelps selected six publicly traded companies that were deemed relevant to its analysis. Duff & Phelps analyzed the financial performance of each of the publicly traded companies. Duff & Phelps then analyzed the selected public companies’ trading multiples, including enterprise value to revenue and EBITDA. Selected M&A Transactions Analysis Duff & Phelps also reviewed certain merger and acquisition transactions involving target companies that were deemed relevant to its analysis and computed the implied valuation multiples for such transactions. Duff & Phelps analyzed a number of factors in comparing the Company to the selected public companies and the targets in the selected M&A transactions, including historical and forecasted growth in revenue and profits, profit margins and other characteristics that we deemed relevant. Duff & Phelps selected multiples that reflect the Company’s size, growth outlook, capital requirements, profit margins, revenue mix, and other characteristics relative to the group. None of the companies utilized for comparative purposes in the following analysis are directly comparable to the Company, and none of the transactions utilized for comparative purposes in the following analysis are directly comparable to the Proposed Transaction. Duff & Phelps does not have access to non-public information of any of the companies used for comparative purposes. Accordingly, a complete valuation analysis of the Company and the Proposed Transaction cannot rely solely upon a quantitative review of the selected companies and selected transactions, and involves complex considerations and judgments concerning differences in financial and operating characteristics of such companies and targets, as well as other factors that could affect their value relative to that of the Company. Therefore, the Selected Public Companies / Selected M&A Transactions Analysis is subject to certain limitations.

 

Se le cte d Public Companie s AnalysisAs of June 18, 2021 COMPANY INFORMATIONREVENUE GROWTHEBITDA GROWTHEBITDA MARGIN Company Name 3-YR CAGRLTM202120222023 3-YR CAGRLTM202120222023 3-YR AVGLTM202120222023 LTM = Latest Twelve Months CAGR = Compounded Annual Growth Rate EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortization Note: The Company’s EBITDA is adjusted to exclude public company costs and non-recurring items as provided by Company management. Source: Capital IQ, Bloomberg, SEC Filings, Annual and Interim Reports.

 

Se le cte d Public Companie s AnalysisAs of June 18, 2021 (US$ in millions, except per share data) COMPANY INFORMATIONMARKET DATAENTERPRISE VALUE AS MULTIPLE OF Common LTM = Latest Twelve Months EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortization Enterprise Value = [Market Capitalization + Management Equity + Debt + Finance Leases + Operating Leases (for IFRS/non-US GAAP companies only) + Preferred Stock + Non-Controlling Interest] - [Cash & Equivalents + Long-Term Investments + Net Non-Operating Assets] Source: Capital IQ, Bloomberg, SEC Filings, Annual and Interim Reports.

 

Selected M&A Transactions Analysis ($ in millions) AnnouncedTarget NameTarget Business DescriptionAcquirer Name Enterprise Value LTM Revenue LTM EBITDA EBITDA Margin EV / Revenue EV / EBITDA Mean 2.51x 10.0x Median 0.94x 11.0x

 

Selected Public Companies / M&A Transactions Analysis Summary (RMB in thousands) Valuation MultiplesValuation Summary Metric Public Companies Range Public Companies Median M&A Transactions Median Selected Multiple Range Company Performance Enterprise Value Range EV / 2022 EBITDA5.4x-25.3x12.6xNA22.0x-27.0x￥989,706￥21,773,530-￥26,722,059 Enterprise Value Range￥21,770,000-￥26,720,000 Implied Value Per ADS Range (USD)$75.77$86.47 Implied Multiples Note: LTM data for the Company as of March 31, 2021. Financial performance metrics presented are adjusted to exclude non-recurring income and expenses and public company costs.

 

 

Exhibit (d)-(4)

 

LIMITED GUARANTEE

 

LIMITED GUARANTEE, dated as of June 21, 2021 (this “Limited Guarantee”), by DCP Capital Partners II, L.P. (the “Guarantor”), in favor of 51job, Inc., an exempted company with limited liability incorporated under the Laws of the Cayman Islands (the “Company” or “Guaranteed Party”). Capitalized terms used and not otherwise defined herein shall have the meaning ascribed to them in the Merger Agreement (as defined below). For the purpose of this Limited Guarantee, each of the terms “control” and “person” shall have the meaning given to it in Section 9.03 of the Merger Agreement.

 

1.              Limited Guarantee. (a) To induce the Guaranteed Party to enter into that certain Agreement and Plan of Merger, dated as of the date hereof (as amended, restated, supplemented or otherwise modified from time to time, the “Merger Agreement”), between the Guaranteed Party and Garnet Faith Limited (“Merger Sub”), pursuant to which, Merger Sub will merge with and into the Guaranteed Party (the “Merger”), with the Guaranteed Party continuing as the surviving company in the Merger, the Guarantor, intending to be legally bound, hereby unconditionally and irrevocably guarantees to the Guaranteed Party the due and punctual payment, observance, performance and discharge of 14.2% (the “Guaranteed Percentage”) of the payment obligations of Merger Sub with respect to (a) the Merger Sub Termination Fee owed by Merger Sub to the Company, if and when due, pursuant to Section 8.06(b) of the Merger Agreement, (b) the Expenses owed by Merger Sub to the Company, if and when due, pursuant to Section 8.06(c) of the Merger Agreement, and (c) costs and expenses in connection with the collection of the Merger Sub Termination Fee owed by Merger Sub to the Company, if and when due, pursuant to Section 8.06(f) of the Merger Agreement, in each case subject to the terms and limitations of Section 8.06(h) of the Merger Agreement (the aggregate obligations of Merger Sub described in clauses (a) through (c), collectively, without regard to the Guaranteed Percentage thereof, the “Obligations”); provided, that notwithstanding anything to the contrary express or implied herein, in no event shall the Guarantor’s maximum aggregate liability under this Limited Guarantee exceed the amount of US$23,247,017.36 less 14.2% of any amount actually paid by or on behalf of Merger Sub to the Guaranteed Party in respect of the Obligations (the “Cap”). The parties agree that this Limited Guarantee may not be enforced without giving effect to the proviso to the immediately preceding sentence, including the Cap, and to the provisions of Section 8 and Section 9 hereof, and that the Guaranteed Party will not seek to enforce this Limited Guarantee for an amount in excess of the Cap. This Limited Guarantee may be enforced for the payment of money only. The Guaranteed Party may, in its sole discretion, bring and prosecute a separate action or actions against the Guarantor pursuant to and in accordance with the terms of this Limited Guarantee for the Guaranteed Percentage of the Obligations, subject to the Cap and the other limitations described herein, regardless of whether an action is brought against any other person (including Merger Sub or any Other Guarantor (as defined below)) or whether any such person is joined in any such action or actions. The Guaranteed Party, by execution of this Limited Guarantee, agrees that in no event shall the Guarantor be required to pay to any person under, in respect of, or in connection with this Limited Guarantee, an amount in excess of the Cap, that the payment by the Guarantor of the Guaranteed Percentage of the Obligations (subject to the Cap) is the sole and exclusive remedy of the Guaranteed Party against the Guarantor in the event the Obligations become due and payable, and that the Guarantor shall not have any obligation or liability to the Guaranteed Party relating to, arising out of or in connection with, this Limited Guarantee, the Equity Commitment Letter (as defined below), the Support Agreements, the Merger Agreement, or any other Transaction Agreement (as defined below) (whether or not the Guarantor is a party thereto or any of the transactions contemplated hereby or thereby, other than as expressly set forth herein (including the Retained Claims) or in the Equity Commitment Letter or in the Support Agreement to which the Guarantor is a party. The Guaranteed Party, by execution of this Limited Guarantee, further acknowledges that, in the event that Merger Sub has any unsatisfied payment obligations, payment of the Guaranteed Percentage of the Obligations in full in accordance with and subject to the terms and conditions (including the Cap) of this Limited Guarantee by the Guarantor (or by any other person, including Merger Sub on behalf of the Guarantor) shall constitute satisfaction in full of the Guarantor’s obligations with respect thereto. All payments hereunder shall be made in lawful money of the United States in immediately available funds. Concurrently with the delivery of this Limited Guarantee, the parties set forth on Schedule A (each, an “Other Guarantor”) are also entering into limited guarantees substantially similar to this Limited Guarantee (each, an “Other Guarantee”) with the Guaranteed Party. The Guaranteed Party represents to the Guarantor that, other than this Limited Guarantee, the Other Guarantees, the Equity Commitment Letters (as defined below) and the Support Agreements, and except as has been furnished to the Guarantor prior to the date hereof, there has been and will be no agreement, understanding or other arrangement (whether written or oral) entered into by the Guaranteed Party with any Other Guarantor in respect of the subject matters of this Limited Guarantee or the Other Guarantees. This Limited Guarantee shall become effective upon the substantially simultaneous signing of this Limited Guarantee and the Other Guarantees.

 

 

(b)            All payments made by the Guarantor pursuant to this Limited Guarantee shall be free and clear of any deduction, offset, defense, claim or counterclaim of any kind. If Merger Sub fails to pay or cause to be paid any or all of the Obligations as and when due pursuant to Section 8.06 of the Merger Agreement, as applicable and subject to the other relevant terms and limitations of the Merger Agreement, then the Guarantor’s liabilities to the Guaranteed Party hereunder in respect of such Obligation shall, at the Guaranteed Party’s option, become immediately due and payable and the Guaranteed Party may at any time and from time to time, at the Guaranteed Party’s option, and so long as Merger Sub remains in breach of such Obligation, take any and all actions available hereunder or under applicable Law to collect the Obligations from the Guarantor, subject to limitations described herein (including the Cap).

 

(c)            The Guarantor agrees to pay on demand all reasonable and documented out-of-pocket expenses (including reasonable fees and expenses of counsel) incurred by the Guaranteed Party in connection with the enforcement of its rights hereunder if (i) the Guarantor asserts in any arbitration, litigation or other proceeding that this Limited Guarantee is illegal, invalid or unenforceable in accordance with its terms and the Guaranteed Party prevails in such arbitration, litigation or other proceeding or (ii) the Guarantor fails or refuses to make any payment to the Guaranteed Party hereunder when due and payable and it is determined judicially or by arbitration that the Guarantor is required to make such payment hereunder.

 

 

2.              Nature of Guarantee. The Guaranteed Party shall not be obligated to file any claim relating to the Obligations in the event that Merger Sub becomes subject to a bankruptcy, reorganization or similar proceeding, and the failure of the Guaranteed Party to so file shall not affect the Guarantor’s obligations hereunder. Subject to the terms hereof, the Guarantor’s liability hereunder is absolute, unconditional, irrevocable and continuing irrespective of any modification, amendment or waiver of or any consent to departure from the Merger Agreement that may be agreed to by Merger Sub, in each case to the extent that any of the foregoing does not have the effect of expanding the circumstances under which the Obligations are payable. In the event that any payment to the Guaranteed Party hereunder in respect of the Obligations is rescinded or must otherwise be returned for any reason whatsoever (other than as set forth in the last sentence of Section 8 hereof), the Guarantor shall remain liable hereunder with respect to the Guaranteed Percentage of such Obligations, subject to the terms and conditions hereof (including the Cap), as if such payment had not been made. This Limited Guarantee is an unconditional guarantee of payment and not of collection. This Limited Guarantee is a primary obligation of the Guarantor and is not merely the creation of a surety relationship, and the Guaranteed Party shall not be required to proceed against Merger Sub first before proceeding against the Guarantor hereunder. Notwithstanding anything herein to the contrary, the Guarantor shall have the right to assert, and shall have the benefit of, any defenses to the payment of the Obligations that are available to Merger Sub under the Merger Agreement or as otherwise expressly provided in Section 3(a) hereof, other than defenses arising from bankruptcy, reorganization or similar proceeding of Merger Sub.

 

 

3.              Changes in Obligations; Certain Waivers. (a) The Guarantor agrees that, subject to the terms hereof, the Guaranteed Party may, in its sole discretion at any time and from time to time, without notice to or further consent of the Guarantor, extend the time of payment of any portion of or waive the Obligations in accordance with Section 9.11 of the Merger Agreement, and may also enter into any agreement with Merger Sub for the extension, renewal, payment, compromise, discharge or release thereof, in whole or in part, or for any modification of the terms of the Merger Agreement or of any agreement between the Guaranteed Party, on the one hand, and Merger Sub, on the other hand, in each case in accordance with the terms of the Merger Agreement, without in any way impairing or affecting the Guarantor’s obligations as provided in this Limited Guarantee; provided, that the consent of the Guarantor shall be required to the extent it has the effect of expanding the circumstances under which the obligations will be payable. The Guaranteed Party shall not release any of the Other Guarantors from any obligations under such Other Guarantees or amend or waive any provision of such Other Guarantees except to the extent the Guarantor under this Limited Guarantee is released or the provisions of the Limited Guarantee are amended or waived, in each case, on terms and conditions no less favorable than those applicable to the Other Guarantees. The Guarantor agrees that, except as set forth in clause (i) in the last sentence of Section 3(c) and except for termination in accordance with Section 8 of this Limited Guarantee, the obligations of the Guarantor hereunder shall not be released or discharged, in whole or in part, or otherwise affected by: (i) the failure or delay of the Guaranteed Party to assert any claim or demand or to enforce any right or remedy against Merger Sub or any Other Guarantor or any other person interested in the transactions contemplated by the Merger Agreement; (ii) any change in the time, place or manner of payment of any of the Obligations, or any escrow arrangement or other security therefor, or any rescission, waiver, compromise, consolidation or other amendment or modification of any of the terms or provisions of the Merger Agreement (in each case, to the extent effected in accordance with the terms of the Merger Agreement) or any other agreement evidencing, securing or otherwise executed in connection with any of the Obligations, in each case, to the extent any of the foregoing does not have the effect of increasing the Cap; (iii) the addition, substitution, discharge or release (in the case of a discharge or release, other than a discharge or release of the Guarantor with respect to the Guaranteed Percentage of the Obligations as a result of payment in full of the Guaranteed Percentage of the Obligations in accordance with their terms, a discharge or release of Merger Sub by the Company with respect to the Obligations under the Merger Agreement, or as a result of defenses to the payment of the Obligations that would be available to Merger Sub under the Merger Agreement) of any person interested in the transactions contemplated by the Merger Agreement; (iv) any change in the corporate existence, structure or ownership of Merger Sub or any other person interested in the transactions contemplated by the Merger Agreement; (v) any insolvency, bankruptcy, reorganization or other similar proceeding affecting Merger Sub or any other person interested in the transactions contemplated by the Merger Agreement or any of their respective assets or any other person now or hereafter liable with respect to the Obligations; (vi) the existence of any claim, set-off or other right which the Guarantor may have at any time against Merger Sub or the Guaranteed Party, whether in connection with the Obligations or otherwise; (vii) any other act or omission that may in any manner or to any extent vary the risk of or to the Guarantor or otherwise operate as a discharge of the Guarantor’s obligations as a matter of law or equity (other than as a result of payment of the applicable Obligations in accordance with its terms); (viii) the adequacy of any other means the Guaranteed Party may have of obtaining repayment of any of the Obligations; or (ix) the value of the Other Guarantees or any other agreement or instrument referred to herein or therein. To the fullest extent permitted by applicable Law, the Guarantor hereby expressly waives any and all rights or defenses arising by reason of any applicable Law which would otherwise require any election of remedies by the Guaranteed Party. The Guarantor waives promptness, diligence, notice of the acceptance of this Limited Guarantee and of the Obligations, presentment, demand for payment, notice of non-performance, default, dishonor and protest, notice of any Obligations incurred and all other notices of any kind (except for notices to be provided to Merger Sub in accordance with the Merger Agreement, this Limited Guarantee or any other agreement or instrument delivered herewith or therewith), all defenses which may be available by virtue of any valuation, stay, moratorium Law or other similar applicable Law now or hereafter in effect, any right to require the marshalling of assets of Merger Sub or any other person interested in the transactions contemplated by the Merger Agreement, and all suretyship defenses generally. Notwithstanding anything herein to the contrary, each of the following defenses shall be retained by the Guarantor: (i) defenses to the payment of the Obligations that are available to Merger Sub or any other person under the Merger Agreement; (ii) breach by the Guaranteed Party of this Limited Guarantee; and (iii) fraud or willful misconduct by the Guaranteed Party or any of the Guaranteed Party Related Persons. The Guarantor acknowledges that it will receive substantial direct and indirect benefits from the transactions contemplated by the Merger Agreement and that the waivers set forth in this Limited Guarantee are knowingly made in contemplation of such benefits.

 

 

(b)            The Guaranteed Party hereby covenants and agrees that it shall not institute, directly or indirectly, and it shall cause its Subsidiaries and other controlled Affiliates and their respective officers and directors (collectively but excluding any member of Merger Sub Group, the “Guaranteed Party Related Persons”) not to institute, directly or indirectly, in the name of or on behalf of the Guaranteed Party or any other person, any action, suit or proceeding or bring any other claim arising under, or in connection with, this Limited Guarantee, the Merger Agreement or the Equity Commitment Letter between the Guarantor and Merger Sub dated the date hereof (the “Equity Commitment Letter”, and together with the other equity commitment letters between each Other Guarantor and 51 Elevate Limited, as applicable, and Merger Sub, collectively, the “Equity Commitment Letters”) and the Support Agreements (this Limited Guarantee, the Other Guarantees, the Merger Agreement, the Equity Commitment Letters and the Support Agreements, collectively, the “Transaction Agreements”), any other agreement or instrument delivered pursuant to such Transaction Agreements, or any of the transactions contemplated hereby or thereby, or in respect of any written or oral representations made or alleged to have been made in connection herewith or therewith, whether at law, in equity, in contract, in tort or otherwise, against Merger Sub, the Guarantor or any Non-Recourse Party (as defined below), except for claims against (i) Merger Sub and its successors and assigns under and to the extent expressly provided in the Merger Agreement, (ii) the Guarantor (but not any Non-Recourse Party) and its successors and assigns under (and to the extent permitted by) this Limited Guarantee by the Guaranteed Party (subject to the Cap and the other limitations described herein), (iii) each Other Guarantor and its successors and assigns under (and to the extent permitted by) its Other Guarantee (subject to the Cap as defined in such Other Guarantee and the other limitations described therein), (iv) the Guarantor, the Other Guarantors and their respective successors and permitted assigns under the Equity Commitment Letters pursuant to and in accordance with the terms of the Equity Commitment Letters and the Merger Agreement and (v) the Continuing Shareholders under the Support Agreements pursuant to and in accordance with the terms of the Support Agreements (claims under clauses (i) through (v) collectively, the “Retained Claims”). Notwithstanding anything in this Agreement to the contrary, but, for the avoidance of doubt, without prejudice to any right to specific performance the Guaranteed Party may have under any Transaction Agreement, in no event shall the Guaranteed Party be entitled to claim, seek or collect money damages from the Guarantor under this Limited Guarantee or any other Transaction Agreement in connection with a Retained Claim involving an aggregate amount payable (inclusive of the Guarantor’s payment of the Guaranteed Percentage of the Obligations) that would exceed the Cap.

 

(c)            The Guarantor hereby unconditionally and irrevocably waives, and agrees not to exercise, any rights that it may now have or hereafter acquire against Merger Sub that arise from the existence, payment, performance, or enforcement of the Obligations under or in respect of this Limited Guarantee (subject to the Cap and the other limitations described herein) or any other agreement in connection therewith, including any right of subrogation, reimbursement, exoneration, contribution or indemnification and any right to participate in any claim or remedy of the Guaranteed Party against Merger Sub or any Other Guarantor, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, including the right to take or receive from Merger Sub or any Other Guarantor, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim, remedy or right, unless and until the Guaranteed Percentage of the Obligations (subject to the Cap) shall have been paid in full in immediately available funds by the Guarantor (or by any other person, including Merger Sub, on behalf of the Guarantor) to the Guaranteed Party. If any amount shall be paid to the Guarantor in violation of the immediately preceding sentence at any time prior to the payment in full in immediately available funds of the Guaranteed Percentage of the Obligations (subject to the Cap) by the Guarantor (or by any other person, including Merger Sub, on behalf of the Guarantor) to the Guaranteed Party, such amount shall be received and held in trust for the benefit of the Guaranteed Party, shall be segregated from other property and funds of the Guarantor and shall forthwith be paid or delivered to the Guaranteed Party in the same form as so received (with any necessary endorsement or assignment) to be credited and applied to the Guaranteed Percentage of the Obligations (subject to the Cap) in accordance with the terms of the Merger Agreement and this Limited Guarantee, whether matured or unmatured, or to be held as collateral for such Guaranteed Percentage of the Obligations (subject to the Cap). Notwithstanding anything to the contrary contained in this Limited Guarantee but subject to clause (v) under Section 3(a), the Guaranteed Party hereby agrees that, (i) to the extent the Obligations are not payable pursuant to, and in accordance with, the Merger Agreement, the Guarantor shall be similarly relieved of its obligations to make payments under this Limited Guarantee for the same obligation for which Merger Sub were relieved under the Merger Agreement, and (ii) the Guarantor shall have the right to assert and shall have the benefit of all defenses to the payment of its obligations under this Limited Guarantee (which in any event shall be subject to the Cap and the other limitations described herein) that would be available to Merger Sub (whether or not any such defense has been asserted by Merger Sub) under the Merger Agreement with respect to the Obligations as well as any defense in respect of fraud or willful misconduct of the Guaranteed Party or the Guaranteed Party Related Persons hereunder or any breach by the Guaranteed Party of any term hereof.

 

 

4.              No Waiver; Cumulative Rights. No failure on the part of either party to exercise, and no delay in exercising, any right, remedy or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise by either party of any right, remedy or power hereunder preclude any other or future exercise of any right, remedy or power hereunder by such party. Except as otherwise set forth herein, each and every right, remedy and power hereby granted to each party hereto or, subject to the terms hereof, allowed it by applicable Law or other agreement shall be cumulative and not exclusive of any other, and may be exercised by such party at any time or from time to time. The Guaranteed Party shall not have any obligation to proceed at any time or in any manner against, or exhaust any or all of the Guaranteed Party’s rights against, Merger Sub or any other person (including any Other Guarantor) liable for any portion of the Obligations prior to proceeding against the Guarantor hereunder, and the failure by the Guaranteed Party to pursue rights or remedies against Merger Sub (or any Other Guarantor) shall not relieve the Guarantor of any liability hereunder, and shall not impair or affect the rights and remedies, whether express, implied or available as a matter of Law, of the Guaranteed Party.

 

5.              Representations and Warranties. The Guarantor hereby represents and warrants that:

 

(a)            it is duly organized and validly existing under the Laws of the jurisdiction of its organization;

 

(b)            it has the requisite power and authority to execute, deliver and perform this Limited Guarantee, and the execution, delivery and performance of this Limited Guarantee have been duly authorized by all necessary action on the Guarantor’s part and do not contravene any provision of the Guarantor’s organizational documents or any Law or contractual restriction binding on the Guarantor;

 

 

(c)            except for the applicable requirements of the Exchange Act, all consents, approvals, authorizations, permits of, filings with and notifications to, any governmental authority necessary for the due execution, delivery and performance of this Limited Guarantee by the Guarantor have been obtained or made and all conditions thereof have been duly complied with;

 

(d)            assuming due execution and delivery of this Limited Guarantee and the Merger Agreement by the Guaranteed Party, this Limited Guarantee constitutes a legal, valid and binding obligation of the Guarantor enforceable against the Guarantor in accordance with its terms, subject to (i) the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar Laws affecting creditors’ rights generally, and (ii) general equitable principles (whether considered in a proceeding in equity or at law); and

 

(e)            the Guarantor has the financial capacity to pay and perform its obligations under this Limited Guarantee, and all funds necessary for the Guarantor to fulfill its obligations under this Limited Guarantee shall be available to the Guarantor (or its assignee pursuant to Section 6) for so long as this Limited Guarantee shall remain in effect in accordance with Section 8.

 

6.              Assignment. Neither the Guarantor nor the Guaranteed Party may assign or delegate this Limited Guarantee or their respective rights, interests or obligations hereunder to any other person (except by operation of law), in whole or in part, without the prior written consent of the Guaranteed Party, in the case of any assignment or delegation by the Guarantor, or the Guarantor, in the case of any assignment or delegation by the Guaranteed Party, and any attempted assignment or delegation without such required consents shall be null and void ab initio and of no force or effect. Notwithstanding the foregoing, the Guarantor may assign or delegate all or a portion of its rights, interests or obligations hereunder, without the prior written consent of the Guaranteed Party, to any Affiliate of the Guarantor, limited partner of the Guarantor or any of its Affiliates, or any affiliated investment fund or investment vehicle that is advised, managed or sponsored by the general partner or the investment manager of the Guarantor or any of its Affiliates; provided that no such assignment or delegation shall relieve the Guarantor of its obligations hereunder.

 

7.              Notices. All notices and other communications hereunder shall be given by the means specified by the Merger Agreement (and shall be deemed given as specified therein), as follows:

 

if to the Guarantor:

 

DCP Capital

21/F, York House, The Landmark, 15 Queen’s Road Central, Hong Kong

Attention: Julian Wolhardt

 

with a copy (which shall not constitute notice) to:

 

Paul, Weiss, Rifkind, Wharton & Garrison LLP
Unit 5201, Fortune Financial Center,
5 Dongsanhuan Zhonglu, Chaoyang District, Beijing 100020, China
Email: [email protected]
Attention: Judie Ng Shortell

 

 

If to the Guaranteed Party, as provided in the Merger Agreement, or, in each case, to such other persons or addresses as may be designated in writing by the party hereto to receive such notice as provided above.

 

8.              Continuing Guarantee. Unless terminated pursuant to this Section 8, this Limited Guarantee shall remain in full force and effect and shall be binding on the Guarantor and its successors and permitted assigns until all of the Guaranteed Percentage of the Obligations (subject to the Cap) under this Limited Guarantee have been indefeasibly paid, observed, performed or satisfied in full, at which time this Limited Guarantee shall terminate in its entirety and the Guarantor shall have no further obligations under this Limited Guarantee. Notwithstanding the foregoing, this Limited Guarantee shall terminate and the Guarantor shall have no further obligations under this Limited Guarantee as of the earliest to occur of (i) the Effective Time, (ii) the termination of the Merger Agreement in accordance with its terms in any circumstances other than pursuant to which Merger Sub would be obligated to make a payment of the Merger Sub Termination Fee in accordance with Section 8.06(b) of the Merger Agreement or pay any other amounts under Sections 8.06(c) or 8.06(f) of the Merger Agreement, (iii) the payment in full of the Obligations, and (iv) the date that is ninety (90) days after any termination of the Merger Agreement in accordance with its terms in any circumstances pursuant to which Merger Sub would be obligated to make a payment of the Merger Sub Termination Fee in accordance with Section 8.06(b) of the Merger Agreement or pay any other amounts under Sections 8.06(c) or 8.06(f) of the Merger Agreement, except as to a claim for payment of any Obligation presented in writing by the Guaranteed Party to Merger Sub or the Guarantor on or prior to the date that is ninety (90) days after such termination of the Merger Agreement (in which case, the date such claim is resolved by a final and non-appealable judicial or arbitral decision or as agreed in writing by the parties hereto or otherwise satisfied), provided, that such claim shall set forth in reasonable detail the basis for such claim and the Guarantor shall not be required to pay any claim not submitted on or before the date that is ninety (90) days after such termination of the Merger Agreement. Notwithstanding anything herein to the contrary, in the event that the Guaranteed Party or any of the Guaranteed Party Related Persons directly or indirectly asserts in any Action at law or in equity or arbitration that the provisions of Section 1 hereof limiting the Guarantor’s liability to the Cap, the provisions of Section 1 hereof limiting the Guaranteed Party’s enforcement hereof to the payment of money only, or the provisions of this Section 8, Section 9 and Section 18 hereof are illegal, invalid or unenforceable in whole or in part, asserts that the Guarantor is liable in excess of or to a greater extent than the Guaranteed Percentage of the Obligations (subject to the Cap), or asserts any theory of liability against Merger Sub, the Guarantor or any Non-Recourse Parties (as defined below) with respect to or in connection with the Transaction Agreements, any other agreement or instrument delivered pursuant to such Transaction Agreements, or any of the transactions contemplated hereby or thereby, other than a Retained Claim, then (A) the obligations of the Guarantor under this Limited Guarantee shall terminate ab initio and be null and void, (B) if the Guarantor has previously made any payments under this Limited Guarantee, it shall be entitled to recover such payments, and (C) neither the Guarantor, nor Merger Sub, nor any Non-Recourse Parties (as defined below) shall have any liability whatsoever (whether at law or in equity, whether sounding in contract, tort, statue or otherwise) to the Guaranteed Party, with respect to the Transaction Agreements or the transactions contemplated by the Transaction Agreements.

 

 

9.              No Recourse. The Guaranteed Party acknowledges that Merger Sub has no assets other than certain contract rights and cash in a de minimis amount, and that no additional funds are expected to be contributed to Merger Sub unless and until the Closing occurs. Notwithstanding anything that may be expressed or implied in this Limited Guarantee, the Merger Agreement or any other Transaction Agreement, or in any agreement or instrument delivered, or statement made or action taken, in connection with or pursuant to the transactions contemplated by any of this Limited Guarantee, the Merger Agreement or any other Transaction Agreement or the negotiation, execution, performance or breach of this Limited Guarantee, the Merger Agreement or any other Transaction Agreements, notwithstanding any equitable, common law or statutory right or claim that may be available to the Guaranteed Party or any of its Affiliates, and notwithstanding the fact that the Guarantor may be a partnership, limited liability company corporation or other entity, by its acceptance of the benefits of this Limited Guarantee, the Guaranteed Party, by executing this Limited Guarantee, acknowledges and agrees, on behalf of itself and the Guaranteed Party Related Persons, that no person other than the Guarantor has any obligations hereunder, and it has no right of recovery hereunder against, no recourse shall be had hereunder against and no personal liability shall hereunder attach to, the Guarantor, any former, current or future direct or indirect holders of any equity, general or limited partnership or limited liability company interest, controlling persons, management companies, portfolio companies, incorporators, directors, officers, employees, agents, advisors, attorneys, Affiliates (other than any successor(s) or permitted assignee(s) under Section 6), members, managers, general or limited partners, stockholders, shareholders, representatives, successors or assignees of the Guarantor, or any former, current or future direct or indirect holders of any equity, general or limited partnership or limited liability company interest, controlling persons, management companies, portfolio companies, incorporators, directors, officers, employees, agents, advisors, attorneys, Affiliates (other than any successor(s) or permitted assignee(s) under Section 6), members, managers, general or limited partners, stockholders, shareholders, representatives, successors or assignees of any of the foregoing (collectively, but not including the Guarantor, the Continuing Shareholder, 51 Elevate Limited, Merger Sub, the Other Guarantors or any permitted assignee under Section 6 hereof, or their respective successors and permitted assigns under the Transaction Agreements, collectively the “Non-Recourse Parties,” and each a “Non-Recourse Party”), through Merger Sub or otherwise, whether by or through attempted piercing of the corporate veil, by or through a claim (whether at law or equity in tort, contract or otherwise) by or on behalf of Merger Sub against any Non-Recourse Party, by the enforcement of any assessment or by any legal or equitable proceeding, by virtue of any applicable Law, or otherwise, except for Retained Claims; provided, however, that notwithstanding anything to the contrary in this Agreement, in the event the Guarantor (A) consolidates with or merges with any other person and is not the continuing or surviving entity of such consolidation or merger or (B) transfers or conveys all or a substantial portion of its properties and other assets to any person such that the sum of the Guarantor’s remaining net assets plus unfunded capital commitments which it is entitled to call is less than the Cap as of the time of such transfer, then, and in each such case, the Guaranteed Party may seek recourse, whether by the enforcement of any judgment or assessment, by any legal or equitable proceeding or by virtue of any statute, regulation or other applicable Law, against such continuing or surviving entity or such person, as the case may be, but only if the Guarantor fails to satisfy its payment obligations hereunder and only to the extent of the liability of the Guarantor hereunder. No person other than the Guarantor (or any successors or permitted assignees under Section 6), the Guaranteed Party (or any successors or permitted assignees under Section 6) and the Non-Recourse Parties shall have any rights or remedies under, in connection with or in any manner related to this Limited Guarantee or the transactions contemplated hereby. Nothing set forth in this Limited Guarantee shall confer or give or shall be construed to confer or give to any person, including the Guaranteed Party or any of the Guaranteed Party (or any successors or permitted assignees under Section 6) Related Persons, any rights or remedies hereunder against any person other than the rights or remedies of the Guaranteed Party against the Guarantor (or any successors or permitted assignees under Section 6) as expressly set forth herein.

 

 

10.            Amendments and Waivers. No amendment or waiver of any provision of this Limited Guarantee will be valid and binding unless it is in writing and signed, in the case of an amendment, by the Guarantor and the Guaranteed Party, or in the case of a waiver, by the party against whom the waiver is to be effective.

 

11.            Governing Law; Jurisdiction.

 

(a)            This Limited Guarantee, and all claims or causes of action (whether at law or in equity, in contract or in tort) that may be based upon, arise out of or relate to this Limited Guarantee or the negotiation, execution or performance hereof, shall be governed by and construed in accordance with the Laws of the State of New York, without giving effect to any choice of Law or conflict of Law rules or provisions thereof that would cause the application of the Laws of any jurisdiction other than the State of New York.

 

(b)            Subject to the provisions of Section 11, any disputes, actions and proceedings against any party or arising out of or in any way relating to this Limited Guarantee shall be submitted to the Hong Kong International Arbitration Centre (“HKIAC”) and resolved in accordance with the Arbitration Rules of HKIAC in force at the relevant time and as may be amended by this Section 11(b) (the “Rules”). The place of arbitration shall be Hong Kong. The official language of the arbitration shall be English and the arbitration tribunal shall consist of three arbitrators (each, an “Arbitrator”). The claimant(s), irrespective of number, shall nominate jointly one Arbitrator; the respondent(s), irrespective of number, shall nominate jointly one Arbitrator; and a third Arbitrator will be nominated jointly by the first two Arbitrators and shall serve as chairman of the arbitration tribunal. In the event the claimant(s) or respondent(s) or the first two Arbitrators shall fail to nominate or agree the joint nomination of an Arbitrator or the third Arbitrator within the time limits specified by the Rules, such Arbitrator shall be appointed promptly by the HKIAC. The arbitration tribunal shall have no authority to award punitive or other punitive-type damages. The award of the arbitration tribunal shall be final and binding upon the disputing parties. Any party to an award may apply to any court of competent jurisdiction for enforcement of such award and, for purposes of the enforcement of such award, the parties irrevocably and unconditionally submit to the jurisdiction of any court of competent jurisdiction and waive any defenses to such enforcement based on lack of personal jurisdiction or inconvenient forum

 

 

(c)            Notwithstanding the foregoing, the parties hereto consent to and agree that in addition to any recourse to arbitration as set out in Section 11(b), any party may, to the extent permitted under the rules and procedures of the HKIAC, seek an interim injunction or other form of relief from the HKIAC as provided for in its Rules. Such application shall also be governed by, and construed in accordance with, the laws of the State of New York.

 

12.            Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS LIMITED GUARANTEE AND ANY OF THE AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR OTHER TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HERETO CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE EITHER OF SUCH WAIVERS, (B) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVERS, (C) IT MAKES SUCH WAIVERS VOLUNTARILY, AND (D) IT HAS BEEN INDUCED TO ENTER INTO THIS LIMITED GUARANTEE BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS section 12.

 

13.            Counterparts. This Limited Guarantee may be executed and delivered (including by e-mail of PDF or scanned versions or by facsimile) in one or more counterparts, and by the parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement.

 

14.            Confidentiality. This Limited Guarantee shall be treated as confidential and is being provided to the Guaranteed Party solely in connection with the Merger Agreement and the transactions contemplated thereby. This Limited Guarantee may not be used, circulated, quoted or otherwise referred to by the Guarantor, the Guaranteed Party or any of their respective Affiliates or representatives in any document, except with the prior written consent of the Guarantor and the Guaranteed Party; provided that the parties hereto may disclose the existence and content of this Limited Guarantee to the extent required by applicable Law, the applicable rules of any national securities exchange, in connection with any SEC filings relating to the Merger Agreement and the transactions contemplated thereby or in connection with any litigation relating to the Merger Agreement or the transactions contemplated thereby as permitted by or provided in the Merger Agreement and the Guarantor may disclose the existence and content of this Limited Guarantee to any Non-Recourse Party which needs to know of the existence of this Limited Guarantee and is subject to the confidentiality obligations substantially identical to the terms contained in this Section 14.

 

 

15.            Entire Agreement. This Limited Guarantee, together with the Merger Agreement (including any schedules, exhibits and annexes thereto and any other documents and instruments referred to thereunder, including the Equity Commitment Letters and the Other Guarantees), constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among or between any of the parties with respect to the subject matter hereof and thereof.

 

16.            No Third-Party Beneficiaries. This Limited Guarantee shall be binding solely on the parties hereto and their respective successors and permitted assigns. This Limited Guarantee shall inure solely to the benefit of the parties hereto and their respective successors and permitted assigns, and nothing set forth in this Limited Guarantee shall, or shall be construed to, confer upon or give to any person, other than the parties hereto and their respective successors and permitted assigns, any benefits, rights or remedies under or by reason of, or any rights to enforce or cause the Guaranteed Party to enforce, any provisions of this Limited Guarantee; provided that the Non-Recourse Parties may rely upon and enforce the provisions of Section 9.

 

17.            Interpretation. Headings are used for reference purposes only and do not affect the meaning or interpretation of this Limited Guarantee. When a reference is made in this Limited Guarantee to a Section, such reference shall be to a Section of this Limited Guarantee unless otherwise indicated. The word “including” and words of similar import when used in this Limited Guarantee will mean “including, without limitation,” unless otherwise specified. The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Limited Guarantee shall refer to this Limited Guarantee as a whole and not to any particular provision of this Limited Guarantee. The definitions contained in this Limited Guarantee are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term. Any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein. References from or through any date shall mean, unless otherwise specified, from and including or through and including, respectively. The symbol “US$” refers to United States Dollars.

 

18.            Severability. Any term or provision hereof that is prohibited or unenforceable in any jurisdiction shall be, as to such jurisdiction, ineffective solely to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction; provided, however, that this Limited Guarantee may not be enforced without giving effect to the limitation of the amount payable hereunder to the Cap and the provisions of Sections 8 and 9 and this Section 18.

 

[Remainder of this page intentionally left blank.]

 

 

IN WITNESS WHEREOF, the Guarantor has caused this Limited Guarantee to be executed and delivered as of the date first written above by its director or officer thereunto duly authorized.

 

	For and on behalf of
	DCP General Partner II, Limited
	acting as general partner of
	DCP Capital Partners II, L.P.
	By:	/s/ Julian Juul Wolhardt
	Name: Julian Juul Wolhardt
	Title: Director

 

[Signature Page to Limited Guarantee]

 

 

IN WITNESS WHEREOF, the Guaranteed Party has caused this Limited Guarantee to be executed and delivered as of the date first written above by its director or officer thereunto duly authorized.

 

	51job, Inc.
	By:	/s/ Eric He
	Name: Eric He
	Title: Director

 

[Signature Page to Limited Guarantee]

 

 

 

Exhibit (d)-(5)

 

LIMITED GUARANTEE

 

LIMITED GUARANTEE, dated as of June 21, 2021 (this “Limited Guarantee”), by Ocean Link Partners II, L.P. (the “Guarantor”), in favor of 51job, Inc., an exempted company with limited liability incorporated under the Laws of the Cayman Islands (the “Company” or “Guaranteed Party”). Capitalized terms used and not otherwise defined herein shall have the meaning ascribed to them in the Merger Agreement (as defined below). For the purpose of this Limited Guarantee, each of the terms “control” and “person” shall have the meaning given to it in Section 9.03 of the Merger Agreement.

 

1.                  Limited Guarantee. (a) To induce the Guaranteed Party to enter into that certain Agreement and Plan of Merger, dated as of the date hereof (as amended, restated, supplemented or otherwise modified from time to time, the “Merger Agreement”), between the Guaranteed Party and Garnet Faith Limited (“Merger Sub”), pursuant to which, Merger Sub will merge with and into the Guaranteed Party (the “Merger”), with the Guaranteed Party continuing as the surviving company in the Merger, the Guarantor, intending to be legally bound, hereby unconditionally and irrevocably guarantees to the Guaranteed Party the due and punctual payment, observance, performance and discharge of 7.6% (the “Guaranteed Percentage”) of the payment obligations of Merger Sub with respect to (a) the Merger Sub Termination Fee owed by Merger Sub to the Company, if and when due, pursuant to Section 8.06(b) of the Merger Agreement, (b) the Expenses owed by Merger Sub to the Company, if and when due, pursuant to Section 8.06(c) of the Merger Agreement, and (c) costs and expenses in connection with the collection of the Merger Sub Termination Fee owed by Merger Sub to the Company, if and when due, pursuant to Section 8.06(f) of the Merger Agreement, in each case subject to the terms and limitations of Section 8.06(h) of the Merger Agreement (the aggregate obligations of Merger Sub described in clauses (a) through (c), collectively, without regard to the Guaranteed Percentage thereof, the “Obligations”); provided, that notwithstanding anything to the contrary express or implied herein, in no event shall the Guarantor’s maximum aggregate liability under this Limited Guarantee exceed the amount of US$12,517,624.12 less 7.6% of any amount actually paid by or on behalf of Merger Sub to the Guaranteed Party in respect of the Obligations (the “Cap”). The parties agree that this Limited Guarantee may not be enforced without giving effect to the proviso to the immediately preceding sentence, including the Cap, and to the provisions of Section 8 and Section 9 hereof, and that the Guaranteed Party will not seek to enforce this Limited Guarantee for an amount in excess of the Cap. This Limited Guarantee may be enforced for the payment of money only. The Guaranteed Party may, in its sole discretion, bring and prosecute a separate action or actions against the Guarantor pursuant to and in accordance with the terms of this Limited Guarantee for the Guaranteed Percentage of the Obligations, subject to the Cap and the other limitations described herein, regardless of whether an action is brought against any other person (including Merger Sub or any Other Guarantor (as defined below)) or whether any such person is joined in any such action or actions. The Guaranteed Party, by execution of this Limited Guarantee, agrees that in no event shall the Guarantor be required to pay to any person under, in respect of, or in connection with this Limited Guarantee, an amount in excess of the Cap, that the payment by the Guarantor of the Guaranteed Percentage of the Obligations (subject to the Cap) is the sole and exclusive remedy of the Guaranteed Party against the Guarantor in the event the Obligations become due and payable, and that the Guarantor shall not have any obligation or liability to the Guaranteed Party relating to, arising out of or in connection with, this Limited Guarantee, the Equity Commitment Letter (as defined below), the Support Agreements, the Merger Agreement, or any other Transaction Agreement (as defined below) (whether or not the Guarantor is a party thereto or any of the transactions contemplated hereby or thereby, other than as expressly set forth herein (including the Retained Claims) or in the Equity Commitment Letter or in the Support Agreement to which the Guarantor is a party. The Guaranteed Party, by execution of this Limited Guarantee, further acknowledges that, in the event that Merger Sub has any unsatisfied payment obligations, payment of the Guaranteed Percentage of the Obligations in full in accordance with and subject to the terms and conditions (including the Cap) of this Limited Guarantee by the Guarantor (or by any other person, including Merger Sub on behalf of the Guarantor) shall constitute satisfaction in full of the Guarantor’s obligations with respect thereto. All payments hereunder shall be made in lawful money of the United States in immediately available funds. Concurrently with the delivery of this Limited Guarantee, the parties set forth on Schedule A (each, an “Other Guarantor”) are also entering into limited guarantees substantially similar to this Limited Guarantee (each, an “Other Guarantee”) with the Guaranteed Party. The Guaranteed Party represents to the Guarantor that, other than this Limited Guarantee, the Other Guarantees, the Equity Commitment Letters (as defined below) and the Support Agreements, and except as has been furnished to the Guarantor prior to the date hereof, there has been and will be no agreement, understanding or other arrangement (whether written or oral) entered into by the Guaranteed Party with any Other Guarantor in respect of the subject matters of this Limited Guarantee or the Other Guarantees. This Limited Guarantee shall become effective upon the substantially simultaneous signing of this Limited Guarantee and the Other Guarantees.

 

 

(b)               All payments made by the Guarantor pursuant to this Limited Guarantee shall be free and clear of any deduction, offset, defense, claim or counterclaim of any kind. If Merger Sub fails to pay or cause to be paid any or all of the Obligations as and when due pursuant to Section 8.06 of the Merger Agreement, as applicable and subject to the other relevant terms and limitations of the Merger Agreement, then the Guarantor’s liabilities to the Guaranteed Party hereunder in respect of such Obligation shall, at the Guaranteed Party’s option, become immediately due and payable and the Guaranteed Party may at any time and from time to time, at the Guaranteed Party’s option, and so long as Merger Sub remains in breach of such Obligation, take any and all actions available hereunder or under applicable Law to collect the Obligations from the Guarantor, subject to limitations described herein (including the Cap).

 

(c)               The Guarantor agrees to pay on demand all reasonable and documented out-of-pocket expenses (including reasonable fees and expenses of counsel) incurred by the Guaranteed Party in connection with the enforcement of its rights hereunder if (i) the Guarantor asserts in any arbitration, litigation or other proceeding that this Limited Guarantee is illegal, invalid or unenforceable in accordance with its terms and the Guaranteed Party prevails in such arbitration, litigation or other proceeding or (ii) the Guarantor fails or refuses to make any payment to the Guaranteed Party hereunder when due and payable and it is determined judicially or by arbitration that the Guarantor is required to make such payment hereunder.

 

 

2.                 Nature of Guarantee. The Guaranteed Party shall not be obligated to file any claim relating to the Obligations in the event that Merger Sub becomes subject to a bankruptcy, reorganization or similar proceeding, and the failure of the Guaranteed Party to so file shall not affect the Guarantor’s obligations hereunder. Subject to the terms hereof, the Guarantor’s liability hereunder is absolute, unconditional, irrevocable and continuing irrespective of any modification, amendment or waiver of or any consent to departure from the Merger Agreement that may be agreed to by Merger Sub, in each case to the extent that any of the foregoing does not have the effect of expanding the circumstances under which the Obligations are payable. In the event that any payment to the Guaranteed Party hereunder in respect of the Obligations is rescinded or must otherwise be returned for any reason whatsoever (other than as set forth in the last sentence of Section 8 hereof), the Guarantor shall remain liable hereunder with respect to the Guaranteed Percentage of such Obligations, subject to the terms and conditions hereof (including the Cap), as if such payment had not been made. This Limited Guarantee is an unconditional guarantee of payment and not of collection. This Limited Guarantee is a primary obligation of the Guarantor and is not merely the creation of a surety relationship, and the Guaranteed Party shall not be required to proceed against Merger Sub first before proceeding against the Guarantor hereunder. Notwithstanding anything herein to the contrary, the Guarantor shall have the right to assert, and shall have the benefit of, any defenses to the payment of the Obligations that are available to Merger Sub under the Merger Agreement or as otherwise expressly provided in Section 3(a) hereof, other than defenses arising from bankruptcy, reorganization or similar proceeding of Merger Sub.

 

 

3.                 Changes in Obligations; Certain Waivers. (a) The Guarantor agrees that, subject to the terms hereof, the Guaranteed Party may, in its sole discretion at any time and from time to time, without notice to or further consent of the Guarantor, extend the time of payment of any portion of or waive the Obligations in accordance with Section 9.11 of the Merger Agreement, and may also enter into any agreement with Merger Sub for the extension, renewal, payment, compromise, discharge or release thereof, in whole or in part, or for any modification of the terms of the Merger Agreement or of any agreement between the Guaranteed Party, on the one hand, and Merger Sub, on the other hand, in each case in accordance with the terms of the Merger Agreement, without in any way impairing or affecting the Guarantor’s obligations as provided in this Limited Guarantee; provided, that the consent of the Guarantor shall be required to the extent it has the effect of expanding the circumstances under which the obligations will be payable. The Guaranteed Party shall not release any of the Other Guarantors from any obligations under such Other Guarantees or amend or waive any provision of such Other Guarantees except to the extent the Guarantor under this Limited Guarantee is released or the provisions of the Limited Guarantee are amended or waived, in each case, on terms and conditions no less favorable than those applicable to the Other Guarantees. The Guarantor agrees that, except as set forth in clause (i) in the last sentence of Section 3(c) and except for termination in accordance with Section 8 of this Limited Guarantee, the obligations of the Guarantor hereunder shall not be released or discharged, in whole or in part, or otherwise affected by: (i) the failure or delay of the Guaranteed Party to assert any claim or demand or to enforce any right or remedy against Merger Sub or any Other Guarantor or any other person interested in the transactions contemplated by the Merger Agreement; (ii) any change in the time, place or manner of payment of any of the Obligations, or any escrow arrangement or other security therefor, or any rescission, waiver, compromise, consolidation or other amendment or modification of any of the terms or provisions of the Merger Agreement (in each case, to the extent effected in accordance with the terms of the Merger Agreement) or any other agreement evidencing, securing or otherwise executed in connection with any of the Obligations, in each case, to the extent any of the foregoing does not have the effect of increasing the Cap; (iii) the addition, substitution, discharge or release (in the case of a discharge or release, other than a discharge or release of the Guarantor with respect to the Guaranteed Percentage of the Obligations as a result of payment in full of the Guaranteed Percentage of the Obligations in accordance with their terms, a discharge or release of Merger Sub by the Company with respect to the Obligations under the Merger Agreement, or as a result of defenses to the payment of the Obligations that would be available to Merger Sub under the Merger Agreement) of any person interested in the transactions contemplated by the Merger Agreement; (iv) any change in the corporate existence, structure or ownership of Merger Sub or any other person interested in the transactions contemplated by the Merger Agreement; (v) any insolvency, bankruptcy, reorganization or other similar proceeding affecting Merger Sub or any other person interested in the transactions contemplated by the Merger Agreement or any of their respective assets or any other person now or hereafter liable with respect to the Obligations; (vi) the existence of any claim, set-off or other right which the Guarantor may have at any time against Merger Sub or the Guaranteed Party, whether in connection with the Obligations or otherwise; (vii) any other act or omission that may in any manner or to any extent vary the risk of or to the Guarantor or otherwise operate as a discharge of the Guarantor’s obligations as a matter of law or equity (other than as a result of payment of the applicable Obligations in accordance with its terms); (viii) the adequacy of any other means the Guaranteed Party may have of obtaining repayment of any of the Obligations; or (ix) the value of the Other Guarantees or any other agreement or instrument referred to herein or therein. To the fullest extent permitted by applicable Law, the Guarantor hereby expressly waives any and all rights or defenses arising by reason of any applicable Law which would otherwise require any election of remedies by the Guaranteed Party. The Guarantor waives promptness, diligence, notice of the acceptance of this Limited Guarantee and of the Obligations, presentment, demand for payment, notice of non-performance, default, dishonor and protest, notice of any Obligations incurred and all other notices of any kind (except for notices to be provided to Merger Sub in accordance with the Merger Agreement, this Limited Guarantee or any other agreement or instrument delivered herewith or therewith), all defenses which may be available by virtue of any valuation, stay, moratorium Law or other similar applicable Law now or hereafter in effect, any right to require the marshalling of assets of Merger Sub or any other person interested in the transactions contemplated by the Merger Agreement, and all suretyship defenses generally. Notwithstanding anything herein to the contrary, each of the following defenses shall be retained by the Guarantor: (i) defenses to the payment of the Obligations that are available to Merger Sub or any other person under the Merger Agreement; (ii) breach by the Guaranteed Party of this Limited Guarantee; and (iii) fraud or willful misconduct by the Guaranteed Party or any of the Guaranteed Party Related Persons. The Guarantor acknowledges that it will receive substantial direct and indirect benefits from the transactions contemplated by the Merger Agreement and that the waivers set forth in this Limited Guarantee are knowingly made in contemplation of such benefits.

 

 

(b)               The Guaranteed Party hereby covenants and agrees that it shall not institute, directly or indirectly, and it shall cause its Subsidiaries and other controlled Affiliates and their respective officers and directors (collectively but excluding any member of Merger Sub Group, the “Guaranteed Party Related Persons”) not to institute, directly or indirectly, in the name of or on behalf of the Guaranteed Party or any other person, any action, suit or proceeding or bring any other claim arising under, or in connection with, this Limited Guarantee, the Merger Agreement or the Equity Commitment Letter between the Guarantor and Merger Sub dated the date hereof (the “Equity Commitment Letter”, and together with the other equity commitment letters between each Other Guarantor and 51 Elevate Limited, as applicable, and Merger Sub, collectively, the “Equity Commitment Letters”) and the Support Agreements (this Limited Guarantee, the Other Guarantees, the Merger Agreement, the Equity Commitment Letters and the Support Agreements, collectively, the “Transaction Agreements”), any other agreement or instrument delivered pursuant to such Transaction Agreements, or any of the transactions contemplated hereby or thereby, or in respect of any written or oral representations made or alleged to have been made in connection herewith or therewith, whether at law, in equity, in contract, in tort or otherwise, against Merger Sub, the Guarantor or any Non-Recourse Party (as defined below), except for claims against (i) Merger Sub and its successors and assigns under and to the extent expressly provided in the Merger Agreement, (ii) the Guarantor (but not any Non-Recourse Party) and its successors and assigns under (and to the extent permitted by) this Limited Guarantee by the Guaranteed Party (subject to the Cap and the other limitations described herein), (iii) each Other Guarantor and its successors and assigns under (and to the extent permitted by) its Other Guarantee (subject to the Cap as defined in such Other Guarantee and the other limitations described therein), (iv) the Guarantor, the Other Guarantors and their respective successors and permitted assigns under the Equity Commitment Letters pursuant to and in accordance with the terms of the Equity Commitment Letters and the Merger Agreement and (v) the Continuing Shareholders under the Support Agreements pursuant to and in accordance with the terms of the Support Agreements (claims under clauses (i) through (v) collectively, the “Retained Claims”). Notwithstanding anything in this Agreement to the contrary, but, for the avoidance of doubt, without prejudice to any right to specific performance the Guaranteed Party may have under any Transaction Agreement, in no event shall the Guaranteed Party be entitled to claim, seek or collect money damages from the Guarantor under this Limited Guarantee or any other Transaction Agreement in connection with a Retained Claim involving an aggregate amount payable (inclusive of the Guarantor’s payment of the Guaranteed Percentage of the Obligations) that would exceed the Cap.

 

(c)               The Guarantor hereby unconditionally and irrevocably waives, and agrees not to exercise, any rights that it may now have or hereafter acquire against Merger Sub that arise from the existence, payment, performance, or enforcement of the Obligations under or in respect of this Limited Guarantee (subject to the Cap and the other limitations described herein) or any other agreement in connection therewith, including any right of subrogation, reimbursement, exoneration, contribution or indemnification and any right to participate in any claim or remedy of the Guaranteed Party against Merger Sub or any Other Guarantor, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, including the right to take or receive from Merger Sub or any Other Guarantor, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim, remedy or right, unless and until the Guaranteed Percentage of the Obligations (subject to the Cap) shall have been paid in full in immediately available funds by the Guarantor (or by any other person, including Merger Sub, on behalf of the Guarantor) to the Guaranteed Party. If any amount shall be paid to the Guarantor in violation of the immediately preceding sentence at any time prior to the payment in full in immediately available funds of the Guaranteed Percentage of the Obligations (subject to the Cap) by the Guarantor (or by any other person, including Merger Sub, on behalf of the Guarantor) to the Guaranteed Party, such amount shall be received and held in trust for the benefit of the Guaranteed Party, shall be segregated from other property and funds of the Guarantor and shall forthwith be paid or delivered to the Guaranteed Party in the same form as so received (with any necessary endorsement or assignment) to be credited and applied to the Guaranteed Percentage of the Obligations (subject to the Cap) in accordance with the terms of the Merger Agreement and this Limited Guarantee, whether matured or unmatured, or to be held as collateral for such Guaranteed Percentage of the Obligations (subject to the Cap). Notwithstanding anything to the contrary contained in this Limited Guarantee but subject to clause (v) under Section 3(a), the Guaranteed Party hereby agrees that, (i) to the extent the Obligations are not payable pursuant to, and in accordance with, the Merger Agreement, the Guarantor shall be similarly relieved of its obligations to make payments under this Limited Guarantee for the same obligation for which Merger Sub were relieved under the Merger Agreement, and (ii) the Guarantor shall have the right to assert and shall have the benefit of all defenses to the payment of its obligations under this Limited Guarantee (which in any event shall be subject to the Cap and the other limitations described herein) that would be available to Merger Sub (whether or not any such defense has been asserted by Merger Sub) under the Merger Agreement with respect to the Obligations as well as any defense in respect of fraud or willful misconduct of the Guaranteed Party or the Guaranteed Party Related Persons hereunder or any breach by the Guaranteed Party of any term hereof.

 

 

4.                  No Waiver; Cumulative Rights. No failure on the part of either party to exercise, and no delay in exercising, any right, remedy or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise by either party of any right, remedy or power hereunder preclude any other or future exercise of any right, remedy or power hereunder by such party. Except as otherwise set forth herein, each and every right, remedy and power hereby granted to each party hereto or, subject to the terms hereof, allowed it by applicable Law or other agreement shall be cumulative and not exclusive of any other, and may be exercised by such party at any time or from time to time. The Guaranteed Party shall not have any obligation to proceed at any time or in any manner against, or exhaust any or all of the Guaranteed Party’s rights against, Merger Sub or any other person (including any Other Guarantor) liable for any portion of the Obligations prior to proceeding against the Guarantor hereunder, and the failure by the Guaranteed Party to pursue rights or remedies against Merger Sub (or any Other Guarantor) shall not relieve the Guarantor of any liability hereunder, and shall not impair or affect the rights and remedies, whether express, implied or available as a matter of Law, of the Guaranteed Party.

 

5.                  Representations and Warranties. The Guarantor hereby represents and warrants that:

 

(a)                it is duly organized and validly existing under the Laws of the jurisdiction of its organization;

 

(b)                it has the requisite power and authority to execute, deliver and perform this Limited Guarantee, and the execution, delivery and performance of this Limited Guarantee have been duly authorized by all necessary action on the Guarantor’s part and do not contravene any provision of the Guarantor’s organizational documents or any Law or contractual restriction binding on the Guarantor;

 

 

(c)                except for the applicable requirements of the Exchange Act, all consents, approvals, authorizations, permits of, filings with and notifications to, any governmental authority necessary for the due execution, delivery and performance of this Limited Guarantee by the Guarantor have been obtained or made and all conditions thereof have been duly complied with;

 

(d)                assuming due execution and delivery of this Limited Guarantee and the Merger Agreement by the Guaranteed Party, this Limited Guarantee constitutes a legal, valid and binding obligation of the Guarantor enforceable against the Guarantor in accordance with its terms, subject to (i) the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar Laws affecting creditors’ rights generally, and (ii) general equitable principles (whether considered in a proceeding in equity or at law); and

 

(e)                the Guarantor has the financial capacity to pay and perform its obligations under this Limited Guarantee, and all funds necessary for the Guarantor to fulfill its obligations under this Limited Guarantee shall be available to the Guarantor (or its assignee pursuant to Section 6) for so long as this Limited Guarantee shall remain in effect in accordance with Section 8.

 

6.                 Assignment. Neither the Guarantor nor the Guaranteed Party may assign or delegate this Limited Guarantee or their respective rights, interests or obligations hereunder to any other person (except by operation of law), in whole or in part, without the prior written consent of the Guaranteed Party, in the case of any assignment or delegation by the Guarantor, or the Guarantor, in the case of any assignment or delegation by the Guaranteed Party, and any attempted assignment or delegation without such required consents shall be null and void ab initio and of no force or effect. Notwithstanding the foregoing, the Guarantor may assign or delegate all or a portion of its rights, interests or obligations hereunder, without the prior written consent of the Guaranteed Party, to any Affiliate of the Guarantor, limited partner of the Guarantor or any of its Affiliates, or any affiliated investment fund or investment vehicle that is advised, managed or sponsored by the general partner or the investment manager of the Guarantor or any of its Affiliates; provided that no such assignment or delegation shall relieve the Guarantor of its obligations hereunder.

 

7.                 Notices. All notices and other communications hereunder shall be given by the means specified by the Merger Agreement (and shall be deemed given as specified therein), as follows:

 

if to the Guarantor:

 

Address: Unit 2823, 28/F, AIA Central, 1 Connaught Road, Central, Hong Kong

Attention: Tony Tianyi Jiang

Facsimile: +852 3421 0430

E-mail: [email protected]

 

with a copy (which shall not constitute notice) to:

 

Kirkland & Ellis
Address: 26th Floor, Gloucester Tower, The Landmark, 15 Queen’s Road Central, Hong Kong
Email: [email protected]; [email protected]
Attention: Daniel Dusek; Joseph Casey

 

 

If to the Guaranteed Party, as provided in the Merger Agreement, or, in each case, to such other persons or addresses as may be designated in writing by the party hereto to receive such notice as provided above.

 

8.                  Continuing Guarantee. Unless terminated pursuant to this Section 8, this Limited Guarantee shall remain in full force and effect and shall be binding on the Guarantor and its successors and permitted assigns until all of the Guaranteed Percentage of the Obligations (subject to the Cap) under this Limited Guarantee have been indefeasibly paid, observed, performed or satisfied in full, at which time this Limited Guarantee shall terminate in its entirety and the Guarantor shall have no further obligations under this Limited Guarantee. Notwithstanding the foregoing, this Limited Guarantee shall terminate and the Guarantor shall have no further obligations under this Limited Guarantee as of the earliest to occur of (i) the Effective Time, (ii) the termination of the Merger Agreement in accordance with its terms in any circumstances other than pursuant to which Merger Sub would be obligated to make a payment of the Merger Sub Termination Fee in accordance with Section 8.06(b) of the Merger Agreement or pay any other amounts under Sections 8.06(c) or 8.06(f) of the Merger Agreement, (iii) the payment in full of the Obligations, and (iv) the date that is ninety (90) days after any termination of the Merger Agreement in accordance with its terms in any circumstances pursuant to which Merger Sub would be obligated to make a payment of the Merger Sub Termination Fee in accordance with Section 8.06(b) of the Merger Agreement or pay any other amounts under Sections 8.06(c) or 8.06(f) of the Merger Agreement, except as to a claim for payment of any Obligation presented in writing by the Guaranteed Party to Merger Sub or the Guarantor on or prior to the date that is ninety (90) days after such termination of the Merger Agreement (in which case, the date such claim is resolved by a final and non-appealable judicial or arbitral decision or as agreed in writing by the parties hereto or otherwise satisfied), provided, that such claim shall set forth in reasonable detail the basis for such claim and the Guarantor shall not be required to pay any claim not submitted on or before the date that is ninety (90) days after such termination of the Merger Agreement. Notwithstanding anything herein to the contrary, in the event that the Guaranteed Party or any of the Guaranteed Party Related Persons directly or indirectly asserts in any Action at law or in equity or arbitration that the provisions of Section 1 hereof limiting the Guarantor’s liability to the Cap, the provisions of Section 1 hereof limiting the Guaranteed Party’s enforcement hereof to the payment of money only, or the provisions of this Section 8, Section 9 and Section 18 hereof are illegal, invalid or unenforceable in whole or in part, asserts that the Guarantor is liable in excess of or to a greater extent than the Guaranteed Percentage of the Obligations (subject to the Cap), or asserts any theory of liability against Merger Sub, the Guarantor or any Non-Recourse Parties (as defined below) with respect to or in connection with the Transaction Agreements, any other agreement or instrument delivered pursuant to such Transaction Agreements, or any of the transactions contemplated hereby or thereby, other than a Retained Claim, then (A) the obligations of the Guarantor under this Limited Guarantee shall terminate ab initio and be null and void, (B) if the Guarantor has previously made any payments under this Limited Guarantee, it shall be entitled to recover such payments, and (C) neither the Guarantor, nor Merger Sub, nor any Non-Recourse Parties (as defined below) shall have any liability whatsoever (whether at law or in equity, whether sounding in contract, tort, statue or otherwise) to the Guaranteed Party, with respect to the Transaction Agreements or the transactions contemplated by the Transaction Agreements.

 

 

9.                  No Recourse. The Guaranteed Party acknowledges that Merger Sub has no assets other than certain contract rights and cash in a de minimis amount, and that no additional funds are expected to be contributed to Merger Sub unless and until the Closing occurs. Notwithstanding anything that may be expressed or implied in this Limited Guarantee, the Merger Agreement or any other Transaction Agreement, or in any agreement or instrument delivered, or statement made or action taken, in connection with or pursuant to the transactions contemplated by any of this Limited Guarantee, the Merger Agreement or any other Transaction Agreement or the negotiation, execution, performance or breach of this Limited Guarantee, the Merger Agreement or any other Transaction Agreements, notwithstanding any equitable, common law or statutory right or claim that may be available to the Guaranteed Party or any of its Affiliates, and notwithstanding the fact that the Guarantor may be a partnership, limited liability company corporation or other entity, by its acceptance of the benefits of this Limited Guarantee, the Guaranteed Party, by executing this Limited Guarantee, acknowledges and agrees, on behalf of itself and the Guaranteed Party Related Persons, that no person other than the Guarantor has any obligations hereunder, and it has no right of recovery hereunder against, no recourse shall be had hereunder against and no personal liability shall hereunder attach to, the Guarantor, any former, current or future direct or indirect holders of any equity, general or limited partnership or limited liability company interest, controlling persons, management companies, portfolio companies, incorporators, directors, officers, employees, agents, advisors, attorneys, Affiliates (other than any successor(s) or permitted assignee(s) under Section 6), members, managers, general or limited partners, stockholders, shareholders, representatives, successors or assignees of the Guarantor, or any former, current or future direct or indirect holders of any equity, general or limited partnership or limited liability company interest, controlling persons, management companies, portfolio companies, incorporators, directors, officers, employees, agents, advisors, attorneys, Affiliates (other than any successor(s) or permitted assignee(s) under Section 6), members, managers, general or limited partners, stockholders, shareholders, representatives, successors or assignees of any of the foregoing (collectively, but not including the Guarantor, the Continuing Shareholder, 51 Elevate Limited, Merger Sub, the Other Guarantors or any permitted assignee under Section 6 hereof, or their respective successors and permitted assigns under the Transaction Agreements, collectively the “Non-Recourse Parties,” and each a “Non-Recourse Party”), through Merger Sub or otherwise, whether by or through attempted piercing of the corporate veil, by or through a claim (whether at law or equity in tort, contract or otherwise) by or on behalf of Merger Sub against any Non-Recourse Party, by the enforcement of any assessment or by any legal or equitable proceeding, by virtue of any applicable Law, or otherwise, except for Retained Claims; provided, however, that notwithstanding anything to the contrary in this Agreement, in the event the Guarantor (A) consolidates with or merges with any other person and is not the continuing or surviving entity of such consolidation or merger or (B) transfers or conveys all or a substantial portion of its properties and other assets to any person such that the sum of the Guarantor’s remaining net assets plus unfunded capital commitments which it is entitled to call is less than the Cap as of the time of such transfer, then, and in each such case, the Guaranteed Party may seek recourse, whether by the enforcement of any judgment or assessment, by any legal or equitable proceeding or by virtue of any statute, regulation or other applicable Law, against such continuing or surviving entity or such person, as the case may be, but only if the Guarantor fails to satisfy its payment obligations hereunder and only to the extent of the liability of the Guarantor hereunder. No person other than the Guarantor (or any successors or permitted assignees under Section 6), the Guaranteed Party (or any successors or permitted assignees under Section 6) and the Non-Recourse Parties shall have any rights or remedies under, in connection with or in any manner related to this Limited Guarantee or the transactions contemplated hereby. Nothing set forth in this Limited Guarantee shall confer or give or shall be construed to confer or give to any person, including the Guaranteed Party or any of the Guaranteed Party (or any successors or permitted assignees under Section 6) Related Persons, any rights or remedies hereunder against any person other than the rights or remedies of the Guaranteed Party against the Guarantor (or any successors or permitted assignees under Section 6) as expressly set forth herein.

 

 

10.               Amendments and Waivers. No amendment or waiver of any provision of this Limited Guarantee will be valid and binding unless it is in writing and signed, in the case of an amendment, by the Guarantor and the Guaranteed Party, or in the case of a waiver, by the party against whom the waiver is to be effective.

 

11.               Governing Law; Jurisdiction.

 

(a)               This Limited Guarantee, and all claims or causes of action (whether at law or in equity, in contract or in tort) that may be based upon, arise out of or relate to this Limited Guarantee or the negotiation, execution or performance hereof, shall be governed by and construed in accordance with the Laws of the State of New York, without giving effect to any choice of Law or conflict of Law rules or provisions thereof that would cause the application of the Laws of any jurisdiction other than the State of New York.

 

(b)               Subject to the provisions of Section 11, any disputes, actions and proceedings against any party or arising out of or in any way relating to this Limited Guarantee shall be submitted to the Hong Kong International Arbitration Centre (“HKIAC”) and resolved in accordance with the Arbitration Rules of HKIAC in force at the relevant time and as may be amended by this Section 11(b) (the “Rules”). The place of arbitration shall be Hong Kong. The official language of the arbitration shall be English and the arbitration tribunal shall consist of three arbitrators (each, an “Arbitrator”). The claimant(s), irrespective of number, shall nominate jointly one Arbitrator; the respondent(s), irrespective of number, shall nominate jointly one Arbitrator; and a third Arbitrator will be nominated jointly by the first two Arbitrators and shall serve as chairman of the arbitration tribunal. In the event the claimant(s) or respondent(s) or the first two Arbitrators shall fail to nominate or agree the joint nomination of an Arbitrator or the third Arbitrator within the time limits specified by the Rules, such Arbitrator shall be appointed promptly by the HKIAC. The arbitration tribunal shall have no authority to award punitive or other punitive-type damages. The award of the arbitration tribunal shall be final and binding upon the disputing parties. Any party to an award may apply to any court of competent jurisdiction for enforcement of such award and, for purposes of the enforcement of such award, the parties irrevocably and unconditionally submit to the jurisdiction of any court of competent jurisdiction and waive any defenses to such enforcement based on lack of personal jurisdiction or inconvenient forum

 

 

(c)                Notwithstanding the foregoing, the parties hereto consent to and agree that in addition to any recourse to arbitration as set out in Section 11(b), any party may, to the extent permitted under the rules and procedures of the HKIAC, seek an interim injunction or other form of relief from the HKIAC as provided for in its Rules. Such application shall also be governed by, and construed in accordance with, the laws of the State of New York.

 

12.               Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS LIMITED GUARANTEE AND ANY OF THE AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR OTHER TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HERETO CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE EITHER OF SUCH WAIVERS, (B) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVERS, (C) IT MAKES SUCH WAIVERS VOLUNTARILY, AND (D) IT HAS BEEN INDUCED TO ENTER INTO THIS LIMITED GUARANTEE BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS section 12.

 

13.               Counterparts. This Limited Guarantee may be executed and delivered (including by e-mail of PDF or scanned versions or by facsimile) in one or more counterparts, and by the parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement.

 

14.               Confidentiality. This Limited Guarantee shall be treated as confidential and is being provided to the Guaranteed Party solely in connection with the Merger Agreement and the transactions contemplated thereby. This Limited Guarantee may not be used, circulated, quoted or otherwise referred to by the Guarantor, the Guaranteed Party or any of their respective Affiliates or representatives in any document, except with the prior written consent of the Guarantor and the Guaranteed Party; provided that the parties hereto may disclose the existence and content of this Limited Guarantee to the extent required by applicable Law, the applicable rules of any national securities exchange, in connection with any SEC filings relating to the Merger Agreement and the transactions contemplated thereby or in connection with any litigation relating to the Merger Agreement or the transactions contemplated thereby as permitted by or provided in the Merger Agreement and the Guarantor may disclose the existence and content of this Limited Guarantee to any Non-Recourse Party which needs to know of the existence of this Limited Guarantee and is subject to the confidentiality obligations substantially identical to the terms contained in this Section 14.

 

 

15.                Entire Agreement. This Limited Guarantee, together with the Merger Agreement (including any schedules, exhibits and annexes thereto and any other documents and instruments referred to thereunder, including the Equity Commitment Letters and the Other Guarantees), constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among or between any of the parties with respect to the subject matter hereof and thereof.

 

16.               No Third-Party Beneficiaries. This Limited Guarantee shall be binding solely on the parties hereto and their respective successors and permitted assigns. This Limited Guarantee shall inure solely to the benefit of the parties hereto and their respective successors and permitted assigns, and nothing set forth in this Limited Guarantee shall, or shall be construed to, confer upon or give to any person, other than the parties hereto and their respective successors and permitted assigns, any benefits, rights or remedies under or by reason of, or any rights to enforce or cause the Guaranteed Party to enforce, any provisions of this Limited Guarantee; provided that the Non-Recourse Parties may rely upon and enforce the provisions of Section 9.

 

17.               Interpretation. Headings are used for reference purposes only and do not affect the meaning or interpretation of this Limited Guarantee. When a reference is made in this Limited Guarantee to a Section, such reference shall be to a Section of this Limited Guarantee unless otherwise indicated. The word “including” and words of similar import when used in this Limited Guarantee will mean “including, without limitation,” unless otherwise specified. The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Limited Guarantee shall refer to this Limited Guarantee as a whole and not to any particular provision of this Limited Guarantee. The definitions contained in this Limited Guarantee are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term. Any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein. References from or through any date shall mean, unless otherwise specified, from and including or through and including, respectively. The symbol “US$” refers to United States Dollars.

 

18.              Severability. Any term or provision hereof that is prohibited or unenforceable in any jurisdiction shall be, as to such jurisdiction, ineffective solely to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction; provided, however, that this Limited Guarantee may not be enforced without giving effect to the limitation of the amount payable hereunder to the Cap and the provisions of Sections 8 and 9 and this Section 18.

 

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IN WITNESS WHEREOF, the Guarantor has caused this Limited Guarantee to be executed and delivered as of the date first written above by its director or officer thereunto duly authorized.

 

	Ocean Link Partners II, L.P.
	By: Ocean Link Partners II GP,
	L.P., its general partner
	By: Ocean Link Partners II GP
	Limited, its general partner

 

By:

/s/ Tianyi Jiang

	Name:  Tianyi Jiang
	Title:  Director

 

[Signature Page to Limited Guarantee]

 

 

IN WITNESS WHEREOF, the Guaranteed Party has caused this Limited Guarantee to be executed and delivered as of the date first written above by its director or officer thereunto duly authorized.

 

51job, Inc.

 

By:

/s/ Eric He

	Name:  Eric He
	Title:  Director

 

[Signature Page to Limited Guarantee]