EXHIBIT 10.8.33

 

STOCK PLEDGE AGREEMENT

 

This STOCK PLEDGE AGREEMENT (this “Pledge Agreement”) dated as of February 14,
2008, is entered into by and among U.S. BANK NATIONAL ASSOCIATION, a national
banking association, as administrative agent for the benefit of the Secured
Parties (as such term is defined in the Financing Agreement, as defined below)
(“Agent”), WESTAFF, INC., a Delaware corporation (“Parent Pledgor”), WESTAFF
(USA), INC., a California corporation (“Borrower”), WESTAFF SUPPORT, INC., a
California corporation (“Westaff Support”), and MEDIAWORLD INTERNATIONAL, a
California corporation (“MediaWorld”; and together with Borrower, Parent Pledgor
and Westaff Support, each is individually from time to time is referred to
herein as a “Pledgor” and collectively as “Pledgors”).

 

RECITALS

 

A.            Concurrently herewith, Borrower is entering into a Financing
Agreement dated of even date herewith (as the same from time to time hereafter
may be amended, modified, supplemented or restated, the “Financing Agreement”)
among the Borrower, as borrower, the Parent Pledgor, as parent guarantor, the
Lenders party thereto (collectively, the “Lenders”), and Agent, pursuant to
which the Secured Parties have agreed to make and maintain certain loans of
money and to extend certain other credit (collectively, the “Credit”) to the
Borrower on the terms and subject to the conditions set forth in the Financing
Agreement and the other Loan Documents.

 

B.            Concurrently therewith and herewith, (i) Parent Pledgor is
entering into a Continuing Guaranty dated as of even date herewith in favor of
Agent for the benefit of the Secured Parties (the “Parent Guaranty”), pursuant
to which Parent Pledgor agrees to guaranty the payment and performance of
Borrower’s obligations under the Financing Agreement and the other Loan
Documents; and (ii) Westaff Support and MediaWorld are entering into a
Continuing Guaranty dated as of even date herewith in favor of Agent for the
benefit of the Secured Parties (the “Subsidiary Guaranty”), pursuant to which
Westaff Support and MediaWorld agree to guaranty the payment and performance of
Borrower’s obligations under the Financing Agreement and the other Loan
Documents.

 

C.            Borrower is a member of an affiliated group of companies that
includes each other Pledgor.

 

D.            The proceeds of the extensions of credit under the Financing
Agreement will be used in part to enable Borrower to make valuable transfers to
one or more of the other Pledgors in connection with the operation of their
respective businesses.

 

E.             Borrower and the other Pledgors are engaged in related
businesses, and each Pledgor will derive substantial direct and indirect benefit
from the making of the extensions of credit under the Financing Agreement.

 

F.             Pledgors are the record and beneficial owners of the issued and
outstanding capital stock in Borrower and its subsidiaries, as described on
Exhibit A attached hereto, which Exhibit is incorporated herein by this
reference and may be amended or supplemented pursuant to the terms of this
Pledge Agreement.

 

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G.            The Secured Parties are willing to make, extend and maintain the
Credit to the Borrower on and after the date of the Financing Agreement, but
only upon the condition, among others, that Pledgors shall have executed this
Pledge Agreement and delivered this Pledge Agreement and the Pledged Collateral
(as defined below) to the Agent, on behalf of and for the benefit of the Secured
Parties.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing Recitals and for other good
and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, and intending to be legally bound, each Pledgor hereby represents,
warrants, covenants and agrees as follows:

 

ARTICLE I

 

DEFINITIONS

 

1.1          Definitions.  Except as provided in Section 1.2 below, all
capitalized terms used but not defined herein shall have the respective meanings
given to them in the Financing Agreement.  In addition, the following terms
shall have the following meanings:

 

“Pledged Collateral” has the meaning set forth in Section 2.1, below and shall
not include any Excluded Collateral.

 

“Code” means the Uniform Commercial Code, as enacted in the State of California,
as amended or superseded from time to time after the date of this Pledge
Agreement.

 

1.2          Code Definitions; Rules of Construction. Unless otherwise defined
herein or the context otherwise requires, terms for which meanings are provided
in the Code are used in this Pledge Agreement, including its preamble and
recitals, with such meanings. Section 1.2 of the Financing Agreement, including
those provisions relating to rules of contract construction and interpretation,
are incorporated into and shall apply to this Pledge Agreement in the same way
and manner as they apply to the Financing Agreement (provided that all
references to “Pledge Agreement” shall refer to this Pledge Agreement and not
the Financing Agreement).

 

ARTICLE II

 

PLEDGE

 

2.1          Pledge and Grant of Security Interest. As security for the full,
complete and final payment and performance when due (whether at stated maturity,
by acceleration or otherwise) of Pledgors’ joint and several Obligations under
the Financing Agreement, the Affiliate Guaranty Agreements and the other Loan
Documents to which such Pledgor is a party, any and all other debts, liabilities
and reimbursement obligations, indemnity obligations and other obligations for
monetary amounts (including reimbursement and indemnity obligations), fees,
expenses, costs or other sums (including Attorneys’ Fees) chargeable to Pledgors
under or

 

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pursuant to any of the Loan Documents, including the Financing Agreement, the
Parent Guaranty, the Subsidiary Guaranty and this Pledge Agreement
(collectively, the “Secured Obligations”), each Pledgor hereby collaterally
assigns, grants, conveys, mortgages, pledges and hypothecates to the Agent, on
behalf of and for the benefit of the Secured Parties, and hereby grants to the
Agent, on behalf of and for the benefit of the Secured Parties, a security
interest in and to all of such Pledgor’s right, title and interest in, to and
under each of the following, whether now existing or hereafter acquired (all of
which being hereinafter collectively called the “Pledged Collateral”):

 

(a)           all Capital Stock or other equity securities in the Borrower and
its subsidiaries owned by such Pledgor and described on Exhibit A hereto
(collectively, the “Shares”), and the certificates representing the Shares, and
all dividends, cash, instruments and other property or proceeds from time to
time received, receivable or otherwise distributed in respect of or in exchange
for any or all such Shares;

 

(b)           all additional Investments, including shares of capital stock or
other equity securities in or of the Borrower and its subsidiaries and voting
trust certificates from time to time acquired by such Pledgor in any manner, and
the certificates representing such additional shares, and all dividends, cash,
instruments, and other property or proceeds from time to time received,
receivable, or otherwise distributed in respect of or in exchange for any or all
of such shares; and

 

(c)           The rents, issues, profits, returns, income, allocations,
distributions and proceeds of and from any and all of the foregoing;

 

provided, however, that (A) if and solely to the extent that the grant of a Lien
herein in the Capital Stock of any Foreign Subsidiary owned by such Pledgor
(other than Westaff (U.K.) Limited) would constitute an investment of earnings
in United States property under Section 956 (or a successor provision) of the
Internal Revenue Code, which investment would trigger any increase in the gross
income of a United States shareholder of such Pledgor pursuant to Section 951
(or a successor provision) of the Internal Revenue Code, there shall be excluded
from the Pledged Collateral thirty-four percent (34.0%) of each class of the
issued and outstanding voting Capital Stock of such Foreign Subsidiary; it being
understood and agreed that all non-voting Capital Stock of such Foreign
Subsidiary shall constitute Pledged Collateral hereunder and (B) the Pledged
Collateral shall not include any of the Capital Stock of Westaff Australia so
long as the Australian Subordination Deed remains in effect and prohibits
Westaff Support from pledging any of the Capital Stock of Westaff Australia,
provided that the Pledged Collateral shall, automatically and without further
action, include, subject to subsection (A) of this proviso, the Capital Stock of
Westaff Australia upon the termination, extinguishment or other removal of such
prohibition (the Capital Stock excluded pursuant to subsections (A) and (B) of
this proviso is collectively referred to herein as the “Excluded Collateral”).

 

2.2          Continuing Security Interest. This Pledge Agreement shall create a
continuing security interest in the Pledged Collateral and shall:

 

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(a)           remain in full force and effect until the Payment in Full (other
than contingent indemnification obligations as to which no claims have yet been
asserted) of the Secured Obligations and the termination of all Revolving Credit
Commitments;

 

(b)           be binding upon each Pledgor and its successors, transferees and
assigns; and

 

(c)           inure, together with the rights and remedies of the Agent and the
Secured Parties hereunder, to the benefit of the Agent and the Secured Parties.

 

Upon the Payment in Full of the Secured Obligations (other than contingent
indemnification obligations as to which no claims have yet been asserted) and
the termination of all Revolving Credit Commitments, the security interest
granted herein shall terminate and all rights to the Pledged Collateral shall
revert to the respective Pledgor. Upon any such termination, the Agent then
shall, at each Pledgor’s sole expense, deliver to such Pledgor, without any
representations, warranties or recourse of any kind whatsoever, any and all
certificates and instruments representing or evidencing such Pledgor’s interest
in the Shares that had been previously delivered by such Pledgor to the Agent,
together with all other Pledged Collateral held by the Agent hereunder, and
execute and deliver to such Pledgor, at such Pledgor’s sole expense, such
documents as such Pledgor shall reasonably request to evidence such termination.

 

2.3          No Assumption. This Pledge Agreement is executed and delivered to
the Agent for collateral security purposes only.  Notwithstanding anything
herein to the contrary:

 

(a)           Each Pledgor shall remain liable under any contracts and
agreements included in the Pledged Collateral to the extent set forth therein,
and shall perform all of its duties and obligations under such contracts and
agreements to the same extent as if this Pledge Agreement had not been executed;

 

(b)           the exercise by the Agent or any Secured Party of any of its or
their rights hereunder shall not release any Pledgor from any of its duties or
obligations under any such contracts or agreements included in the Pledged
Collateral; and

 

(c)           the Agent and the Secured Parties shall not have any obligation or
liability under any such contracts or agreements included in the Pledged
Collateral by reason of this Pledge Agreement, nor shall the Agent or any
Secured Party be obligated to perform any of the obligations or duties of any
Pledgor thereunder or to take any action to collect or enforce any claim for
payment assigned hereunder.

 

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES

 

3.1          Representations And Warranties.  Each Pledgor hereby represents and
warrants to the Agent for the benefit of the Secured Parties, as at the date of
each pledge and delivery hereunder by such Pledgor to the Agent of any Pledged
Collateral and as of each date that the representations and warranties under the
Financing Agreement are made (other than representations and warranties made as
of a specific date, which shall be deemed to have been

 

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made as of such specific date), as set forth in the following Sections 3.1(a)
through 3.1(m), inclusive.

 

(a)           Organization.  Such Pledgor is duly formed and validly existing
under the laws of its state of incorporation and has full power and authority to
enter into and perform its obligations under this Pledge Agreement.

 

(b)           Capacity; Due Authorization; Non-Contravention. The execution,
delivery and performance by such Pledgor of this Pledge Agreement and each other
Loan Document executed or to be executed by it have been duly authorized by all
necessary action, and do not contravene its organizational documents; and in
each case do not:

 

(i)            contravene any material contractual restriction, court decree or
order binding on or affecting such Pledgor or, to the best of such Pledgor’s
knowledge, after due inquiry, any material law binding on or affecting such
Pledgor in a manner that would, in each case, be reasonably expected to
adversely affect the enforceability of this Agreement; or

 

(ii)           result in, or require the creation or imposition of, any Lien on
any of such Pledgor’s properties except as contemplated hereby.

 

(c)           Binding Obligations. This Pledge Agreement, when executed and
delivered, constitutes, and each other Loan Document executed by such Pledgor
will, on the due execution and delivery thereof, constitute, the legal, valid
and binding obligations of such Pledgor, enforceable against such Pledgor in
accordance with their respective terms, except as enforcement hereof may be
limited by bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors’ rights generally and by general
principles of equity.

 

(d)           Filing. As of the Closing Date, no presently effective Uniform
Commercial Code financing statement covering any of the Pledged Collateral is on
file in any public office, except for Uniform Commercial Code financing
statements in favor of the Agent.

 

(e)           Ownership; No Liens. Each Pledgor is the legal and beneficial
owner of, and has all rights and good title to (and has full right and authority
to pledge and collaterally assign) all Pledged Collateral pledged by such
Pledgor hereunder, free and clear of all adverse claims or other Liens, except
Permitted Liens and the Lien granted herein to the Agent.

 

(f)            Ownership Interests. Set forth in Exhibit A is the true and
accurate description of such Pledgor’s ownership interest in the Shares.

 

(g)           Certificate. No interest of such Pledgor in the Borrower or its
Subsidiaries is represented by a certificate of interest or similar instrument,
except, such certificates or instruments (together with all necessary
instruments of transfer or assignment, duly executed in blank) as have been
delivered to the Agent or the Agent’s designated bailee and are held in its
possession, except for such certificates which represent the Excluded
Collateral.

 

(h)           Information. All information with respect to the Pledged
Collateral set forth in any schedule, certificate or other writing at any time
furnished by such Pledgor to the

 

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Agent or any Secured Party, and all other written information at any time
furnished by such Pledgor to the Agent or any Secured Party, is and shall be
true and correct in all material respects as of the date furnished.

 

(i)            Records. The address of the location of the records of such
Pledgor concerning the Pledged Collateral and the address of such Pledgor’s
principal place of business and chief executive office as of the Closing Date is
set forth in Schedule I to this Pledge Agreement.

 

(j)            Authorization; Approval. No authorization, approval, or other
action by, and no notice to or filing with, any Governmental Authority, or any
other Person is required for the pledge by such Pledgor of any Pledged
Collateral pursuant to this Pledge Agreement or for the execution, delivery, and
performance of this Pledge Agreement by such Pledgor.

 

(k)           [Reserved.]

 

(l)            No Offset or Defense. The Secured Obligations are not subject to
any offset or defense of any kind against the Agent, the Secured Parties or such
Pledgor.

 

(m)          Continuation of Representations and Warranties. Such Pledgor
covenants, warrants and represents to the Agent and each Secured Party that all
representations and warranties contained in this Pledge Agreement shall be true,
accurate and complete in all material respects at the time of such Pledgor’s
execution of this Pledge Agreement and, shall continue to be true, accurate and
complete in all material respects until the Secured Obligations have been fully,
completely and finally paid and performed and all Revolving Credit Commitments
terminated.

 

ARTICLE IV

 

COVENANTS

 

4.1          Protect Pledged Collateral; Further Assurances. No Pledgor shall
sell, assign, transfer, pledge or otherwise encumber the Pledged Collateral in
any manner (except for the pledge granted herein to the Agent), except to the
extent permitted by the Financing Agreement. Each Pledgor shall warrant and
defend the right and title granted by this Pledge Agreement to the Agent in and
to the Pledged Collateral (and all right, title and interest represented by the
Pledged Collateral) against the claims and demands of all Persons whomsoever,
but nothing contained herein shall prevent the Borrower from issuing additional
Capital Stock. Each Pledgor agrees, at any time, and from time to time, at the
expense of such Pledgor, such Pledgor shall promptly execute and deliver all
further instruments, and take all further action that may be necessary or
desirable, or that the Agent may reasonably request, in order to perfect and
protect any security interest granted or purported to be granted hereby or to
enable the Agent or any Secured Party to exercise and enforce its rights and
remedies hereunder with respect to any of the Pledged Collateral as set forth in
Article V hereof.

 

4.2          Voting Rights. If an Event of Default shall have occurred and be
continuing and the Agent shall have notified Pledgors of the Agent’s intention
to exercise its voting power under this Section 4.2, each Pledgor agrees:

 

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(a)           that the Agent may exercise (to the exclusion of such Pledgor) the
voting power, and all other incidental rights of ownership with respect to the
Pledged Collateral and such Pledgor hereby grants the Agent, from the date
hereof until the Payment in Full of the Secured Obligations (other than
contingent indemnity obligations as to which no claims have yet been asserted)
and termination of the Revolving Credit Commitments, an irrevocable proxy,
coupled with an interest exercisable under such circumstances, to vote such
Pledged Collateral; and

 

(b)           promptly to deliver to the Agent such additional proxies and other
documents as may be necessary to allow the Agent to exercise such voting power.

 

All payments and proceeds which may at any time and from time to time be held by
such Pledgor but which such Pledgor is obligated under the terms hereof or under
any other Loan Document to deliver to the Agent, on behalf of the Secured
Parties, shall be held by such Pledgor separate and apart from its other
Property in trust for the Agent and the Secured Parties. Unless an Event of
Default shall have occurred and be continuing and the Agent shall have given the
notice referred to in this Section 4.2, such Pledgor shall have the exclusive
voting power with respect to the Pledged Collateral and the Agent shall, upon
the written request of such Pledgor, promptly deliver such proxies and other
documents, if any, as shall be reasonably requested by such Pledgor which are
necessary to allow such Pledgor to exercise voting power with respect to the
Pledged Collateral; provided, however, that no vote shall be cast, or consent,
waiver or ratification given or action taken by such Pledgor that would impair
any Pledged Collateral or be inconsistent with or violate any provision of the
Financing Agreement or any other Loan Document (including this Pledge
Agreement).

 

4.3          Filings; Recordings. Each Pledgor authorizes the Agent at any time
and from time to time to file such Uniform Commercial Code financing statements
and Pledgor shall execute such other documents (and pay the cost of filing or
recording the same in all public offices reasonably deemed necessary or
appropriate by the Agent), and do such other acts and things, all as the Agent
may from time to time reasonably request to establish and maintain a valid,
perfected pledge of, and security interest in, the Pledged Collateral in favor
of the Agent.

 

4.4          Maintenance of Records. Subject to the provisions of Section 4.5,
each Pledgor shall keep at its address indicated on Schedule I all its records
concerning the Pledged Collateral.

 

4.5          Notice of Change of Address; Change of Jurisdiction of
Registration. Each Pledgor shall furnish to the Agent prior written notice of
any change in the address of such Pledgor’s chief executive office (as described
on Schedule I) or in the name of such Pledgor. No Pledgor shall change its state
of registration without 10 days prior written notice to the Agent.

 

4.6          Information. Each Pledgor shall furnish to the Agent such
information concerning the Pledged Collateral as the Agent may from time to time
reasonably request, and will permit the Agent and its designees, subject to
Section 8.2 of the Financing Agreement, from time to time during normal business
hours and upon reasonable prior notice, to inspect, audit and make copies of and
extracts from all records and all other papers in the possession of

 

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such Pledgor which pertain to the Pledged Collateral, and shall upon the
reasonable request of the Agent, deliver to the Agent copies of all of such
records and papers.

 

ARTICLE V

 

THE ADMINISTRATIVE AGENT

 

5.1          The Agent Appointed Attorney-in-Fact. Each Pledgor hereby
irrevocably appoints the Agent to be such Pledgor’s attorney-in-fact, with full
authority in the place and stead of such Pledgor and in the name of such Pledgor
or otherwise, from time to time in the Agent’s discretion after the occurrence
and during the continuance of an Event of Default, to take any action and to
execute any instrument which the Agent may reasonably deem necessary or
advisable to accomplish the purposes of this Pledge Agreement, including:

 

(a)           to ask, demand, collect, sue for, recover, compromise, receive and
give acquittance and receipts for moneys due and to become due under or in
respect of any of the Pledged Collateral;

 

(b)           to receive, endorse, and collect any drafts or other instruments,
documents and chattel paper, in connection with clause (a), above; and

 

(c)           to file any claims or take any action or institute any proceedings
which the Agent may deem necessary or desirable for the collection of any of the
Pledged Collateral or otherwise to enforce the rights of the Agent with respect
to any of the Pledged Collateral.

 

Each Pledgor hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section 5.1 is irrevocable and coupled with an
interest; provided that the foregoing power of attorney shall terminate upon the
full, final and complete payment of the Obligations and the termination of all
Revolving Credit Commitments.

 

5.2          The Agent May Perform. If any Pledgor fails to perform any
agreement contained herein, the Agent may itself perform, or cause performance
of, such agreement for the benefit of the Secured Parties and not for such
Pledgor and the reasonable expenses of the Agent incurred in connection
therewith shall be payable by Pledgors pursuant to Section 6.5.

 

5.3          The Agent Has No Duty. The powers conferred on the Agent hereunder
are solely to protect its interest in the Pledged Collateral and shall not
impose any duty on it to exercise any such powers, except that the Agent will
exercise such duties, if any, imposed upon it under the Code or other
requirements of law.  The Agent shall have no duty as to any Pledged Collateral
or responsibility for (a) ascertaining or taking action with respect to calls,
conversions, exchanges, maturities, tenders or other matters relative to any
Pledged Collateral, whether or not the Agent has or is deemed to have knowledge
of such matters, or (b) taking any necessary steps to preserve rights against
prior parties or any other rights pertaining to any Pledged Collateral. Without
limiting the generality of the preceding sentence, the Agent shall be deemed to
have exercised reasonable care in the custody and preservation of any of the
Pledged Collateral if it takes such action for that purpose as any Pledgor
reasonably requests in writing at times other than upon the occurrence and
during the continuance of any Event of Default.

 

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Failure of the Agent to comply with any such request at any time shall not in
itself be deemed a failure to exercise reasonable care.

 

ARTICLE VI

 

DEFAULTS AND REMEDIES

 

6.1          Events Of Default. It shall be an “Event of Default” hereunder if
any Event of Default (as defined in the Financing Agreement) shall occur.

 

6.2          Certain Remedies. If any Event of Default shall have occurred and
be continuing:

 

(a)           The Agent may exercise in respect of the Pledged Collateral, in
addition to other rights and remedies provided for herein or otherwise available
to it, all the rights and remedies of a secured party on default under the Code
(whether or not the Code applies to the affected Pledged Collateral) and also
may, without notice except as specified below, sell the Pledged Collateral or
any part thereof in one or more parcels at public or private sale, at any of the
Agent’s offices or elsewhere, for cash, on credit or for future delivery, and
upon such other terms as the Agent may deem commercially reasonable. Each
Pledgor agrees that, to the extent notice of sale shall be required by law, at
least ten (10) days’ prior notice to such Pledgor of the time and place of any
public sale or the time after which any private sale is to be made shall
constitute reasonable notification. The Agent shall not be obligated to make any
sale of Pledged Collateral regardless of notice of sale having been given. The
Agent may adjourn any public or private sale from time to time by announcement
at the time and place fixed therefor, and such sale may, without further notice,
be made at the time and place to which it was so adjourned.

 

(b)           The Agent may:

 

(i)            transfer all or any part of the Pledged Collateral into the name
of the Agent or its nominee, with or without disclosing that such Pledged
Collateral is subject to the Lien hereunder;

 

(ii)           notify the parties obligated on any of the Pledged Collateral to
make payment to the Agent of any amount due or to become due thereunder;

 

(iii)         enforce collection of any of the Pledged Collateral by suit or
otherwise, and surrender, release or exchange all or any part thereof, or
compromise or extend or renew for any period (whether or not longer than the
original period) any obligations of any nature of any party with respect
thereto;

 

(iv)          endorse any checks, drafts, or other writings in any Pledgor’s
name to allow collection of the Pledged Collateral;

 

(v)            take control of any proceeds of the Pledged Collateral; and

 

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(vi)          execute (in the name, place and stead of any Pledgor)
endorsements, assignments and other instruments of conveyance or transfer with
respect to all or any of the Pledged Collateral.

 

(c)           If, at any time when the Agent shall determine to exercise its
right to sell the whole or any part of the Pledged Collateral hereunder, such
Pledged Collateral or the part thereof to be sold shall not, for any reason
whatsoever, be effectively registered under Securities Act of 1933, as amended
(as so amended, the “Act”), the Agent may, in its discretion (subject only to
applicable requirements of law), sell such Pledged Collateral or part thereof by
private sale in such manner and under such circumstances as the Agent may deem
necessary or advisable, but subject to the other requirements of this
Section 6.2(c), and shall not be required to effect such registration or cause
the same to be effected. Without limiting the generality of the foregoing, in
any such event the Agent may, in its sole discretion, (i) in accordance with
applicable securities laws, proceed to make such private sale notwithstanding
that a registration statement for the purpose of registering such Pledged
Collateral or part thereof could be or shall have been filed under the Act;
(ii) approach and negotiate with a single possible purchaser to effect such
sale; and (iii) restrict such sale to a purchaser who will represent and agree
that such purchaser is purchasing for its own account, for investment, and not
with a view to the distribution or sale of such Pledged Collateral or part
thereof. In addition to a private sale as provided above in this Section 6.2(c),
if any of the Pledged Collateral shall not be freely distributable to the public
without registration under the Act at the time of any proposed sale hereunder,
then the Agent shall not be required to effect such registration or cause the
same to be effected but may, in its sole discretion (subject only to applicable
requirements of law), require that any sale hereunder (including a sale at
auction) be conducted subject to such restrictions as the Agent may, in its sole
discretion, deem necessary or appropriate in order that such sale
(notwithstanding any failure so to register) may be effected in compliance with
the Bankruptcy Code of 1978, as amended, 11 U.S.C. § 101 et seq., as amended,
and other laws affecting the enforcement of creditors’ rights and the Act and
all applicable state securities laws.

 

(d)           Each Pledgor agrees that a breach of any covenants contained in
this Article VI which has the effect of denying the Agent the realization of the
practical benefits to be provided by this Pledge Agreement will cause
irreparable injury to the Agent, on behalf and for the benefit of the Secured
Parties, and that in such event the Agent and the Secured Parties would have no
adequate remedy at law in respect of such breach and, as a consequence, agrees
that in such event each and every covenant contained in this Article VI shall be
specifically enforceable against such Pledgor, and such Pledgor hereby waives
and agrees not to assert any defenses against an action for specific performance
of such covenants except for a defense that the Secured Obligations are not then
due and payable or that the Secured Obligations have been paid in full.

 

6.3          Compliance With Restrictions. Each Pledgor agrees that in any sale
of any of the Pledged Collateral under the terms of this Pledge Agreement,
whether at a foreclosure sale or otherwise, the Agent is hereby authorized to
comply with any limitation or restriction in connection with such sale as it may
be advised by counsel is necessary in order to avoid any violation of applicable
law (including compliance with such procedures as may restrict the number of
prospective bidders and purchasers, require that such prospective bidders and
purchasers have certain qualifications and restrict such prospective bidders and
purchasers to

 

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persons who will represent and agree that they are purchasing for their own
account for investment and not with a view to the distribution or resale of such
Pledged Collateral), or in order to obtain any required approval of the sale or
of the purchaser by any Governmental Authority, and such Pledgor further agrees
that such compliance shall not result in such sale being considered or deemed
not to have been made in a commercially reasonable manner, nor shall the Agent
nor the Secured Parties be liable nor accountable to such Pledgor for any
discount allowed by the reason of the fact that such Pledged Collateral is sold
in compliance with any such limitation or restriction.

 

6.4          Application Of Proceeds. All cash proceeds received by the Agent in
respect of any sale of, collection from, or other realization upon, all or any
part of the Pledged Collateral shall be applied as provided in the Financing
Agreement.  Any surplus of such cash or cash proceeds held by the Agent and
remaining after payment in full of all of the Secured Obligations, and the
termination of all Revolving Credit Commitments, shall be paid over to the
respective Pledgor(s) or as required by law.

 

6.5          Indemnity And Expenses. Each Pledgor hereby indemnifies and holds
harmless the Agent and each Secured Party from and against any and all claims,
losses, and liabilities arising out of or resulting from this Pledge Agreement
(including enforcement of this Pledge Agreement), except claims, losses, or
liabilities resulting solely from the gross negligence or willful misconduct of
the Agent or any Secured Party, or any of their officers, directors, employees
or agents.  To the extent not otherwise provided in the Financing Agreement,
upon demand, each Pledgor shall pay to the Agent or such Secured Party the
amount of any and all reasonable expenses, including the reasonable fees and
disbursements of its counsel and of any experts and agents (including Attorneys’
Fees, whether related to a suit or action or any reviews of or appeals from a
judgment or decree therein or in connection with non judicial action) which the
Agent or such Secured Party may incur in connection with (a) the custody,
preservation, use, or operation of, or the sale of, collection from, or other
realization upon, any of the Pledged Collateral, (b) the exercise or enforcement
of any of the rights of the Agent or the Secured Parties hereunder, or (c) the
failure by such Pledgor to perform or observe any of the provisions hereof.

 

ARTICLE VII

 

MISCELLANEOUS PROVISIONS

 

7.1          Loan Document. This Pledge Agreement is a Loan Document executed
pursuant to the Financing Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions thereof.

 

7.2          The Pledged Collateral.  Each Pledgor acknowledges that it has,
independently of and without reliance on the Secured Parties or the Agent, made
its own credit analysis of the Borrower and performed its own legal review of
this Pledge Agreement and the other Loan Documents and is not relying on the
Secured Parties or the Agent with respect to any of the aforesaid items. Each
Pledgor agrees to keep adequately informed from such means of any facts, events
or circumstances which might in any way affect such Pledgor’s risks hereunder.

 

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The Secured Parties and the Agent make no representation of its interest in, or
the priority or perfection of the Agent’s security interest in and to, any of
the Pledged Collateral.

 

7.3          Reinstatement. This Pledge Agreement shall remain in full force and
effect and continue to be effective if at any time payment of the Secured
Obligations, or any part thereof, is, pursuant to applicable law, avoided,
rescinded or reduced in amount, or must otherwise be restored or returned by any
obligee of the Secured Obligations, whether as a “voidable preference,”
“fraudulent conveyance,” or otherwise (and whether as a result of any demand,
settlement, litigation or otherwise), all as though such payment or performance
had not been made. In the event that any payment, or any part thereof, is
avoided, rescinded, reduced, restored, or returned, the Secured Obligations,
shall be reinstated and deemed reduced only by such amount paid and not so
avoided, rescinded, reduced, restored, or returned.

 

7.4          Amendments; Waivers. No amendment to or waiver of any provision of
this Pledge Agreement nor consent to any departure by any Pledgor from any
provision in this Pledge Agreement shall in any event be effective unless the
same shall be in writing and signed by the Agent and such Pledgor, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which it is given.

 

7.5          Protection Of Pledged Collateral. The Agent may from time to time,
at its option, perform any act which Pledgors agree hereunder to perform and
which any Pledgor shall fail to perform after being requested in writing so to
perform (it being understood that no such request need be given after the
occurrence and during the continuance of any Event of Default) and the Agent may
from time to time take any other action which the Agent reasonably deems
necessary for the maintenance, preservation or protection of any of the Pledged
Collateral or of its security interest therein, all such actions being for the
express benefit of the Secured Parties and the Agent and not Pledgors.

 

7.6          Addresses For Notices. All notices and other communications
provided for hereunder shall be in writing or by facsimile and addressed,
delivered or transmitted to such party at its address or facsimile number set
forth below its signature on this Pledge Agreement or at such other address or
facsimile number as may be designated by such party in a notice to the other
party. Any notice, if mailed and properly addressed with postage prepaid or if
properly addressed and sent by pre-paid courier service, shall be deemed given
when received; any notice, if transmitted by facsimile, shall be deemed given
when transmitted.

 

7.7          Right of Set-Off. Upon the occurrence and during the continuance of
any Event of Default, the Agent and the Secured Parties, after obtaining the
prior written consent of the Agent, are hereby authorized, at any time and from
time to time, without notice to Pledgors (any such notice being expressly waived
by each Pledgor), to set off against the Secured Obligations any deposits
(including general time or demand, provisional or final) or other sums credited
by or due and owing from such Secured Party or the Agent to Pledgors,
irrespective of whether or not such Secured Parties or the Agent, on behalf of
the Secured Parties, shall have made any demand under this Pledge Agreement, the
Financing Agreement or any of the other Loan Documents. The rights of the
Secured Parties and the Agent under this Section 7.7 are in addition to all
other rights and remedies (including, without limitation, other rights of
set-off) which the Secured Parties and the Agent may have. Each Pledgor grants
to the Agent for itself

 

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and for the benefit of the Secured Parties, a security interest in any and all
such deposit accounts as security for satisfaction of the foregoing obligations,
provided that such security interest shall not preclude any Pledgor from
withdrawing funds in the ordinary course from any such account prior to the
occurrence and during the continuation of an Event of Default.

 

7.8          Section Captions. Section captions used in this Pledge Agreement
are for convenience of reference only, and shall not affect the construction of
this Pledge Agreement.

 

7.9          Severability. Wherever possible each provision of this Pledge
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Pledge Agreement shall be
prohibited by or invalid under such law, such provision shall be ineffective to
the extent of such prohibition or invalidity, without invalidating the remainder
of such provision or the remaining provisions of this Pledge Agreement.

 

7.10        Counterparts. This Pledge Agreement may be executed in any number of
counterparts, each of which when so delivered shall be deemed an original, but
all such counterparts shall constitute but one and the same instrument. Each
such agreement shall become effective upon the execution of a counterpart hereof
or thereof by each of the parties hereto.

 

7.11        Governing Law; Entire Agreement. THIS PLEDGE AGREEMENT HAS BEEN
DELIVERED AND ACCEPTED AT AND SHALL BE DEEMED TO HAVE BEEN MADE AT LOS ANGELES,
CALIFORNIA.  THIS PLEDGE AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER
AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF CALIFORNIA (WITHOUT REGARD TO
CALIFORNIA CONFLICTS OF LAW PRINCIPLES). THIS PLEDGE AGREEMENT AND THE OTHER
LOAN DOCUMENTS CONSTITUTE THE ENTIRE UNDERSTANDING AMONG THE PARTIES HERETO WITH
RESPECT TO THE SUBJECT MATTER HEREOF AND SUPERSEDE ANY PRIOR AGREEMENTS, WRITTEN
OR ORAL, WITH RESPECT THERETO.

 

7.12        Waiver of Jury Trial. EACH PLEDGOR AND THE AGENT HEREBY IRREVOCABLY
WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL WITH RESPECT TO ANY ACTION, CLAIM
OR OTHER PROCEEDING, WHETHER ARISING IN CONTRACT, TORT OR OTHERWISE, ARISING OUT
OF ANY DISPUTE IN CONNECTION WITH THIS PLEDGE AGREEMENT OR THE OTHER LOAN
DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER, OR THE PERFORMANCE
OF SUCH RIGHTS AND OBLIGATIONS.

 

7.13        Incorporation of Judicial Reference Provisions.  The judicial
reference provisions set forth in Section 15.15 of the Financing Agreement are
hereby incorporated into this Pledge Agreement by reference (provided that for
purposes of this Section 7.13, each reference to “Borrower” therein shall be
deemed to refer to Pledgors, individually and collectively, hereunder) .

 

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7.14        Conflicting Terms.  In the event of any conflict between the terms
of this Pledge Agreement and the Security Agreement, the terms of the Security
Agreement shall control to the extent of any such conflict.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Pledge Agreement to be
duly executed and delivered by their respective duly authorized officers as of
the day and year first above written.

 

PLEDGORS:

WESTAFF (USA), INC.,

a California corporation

 

 

 

 

 

By:

/s/ Dawn M. Jaffray

 

 

Dawn M. Jaffray

 

 

Senior Vice President and Chief Financial

Officer

 

 

 

 

Address for Notices:

 

 

 

 

298 North Wiget Lane

Walnut Creek, California 94598

Attention: (925) 951-4011

Facsimile: (925) 934-5489

 

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WESTAFF, INC.,

a Delaware corporation

 

 

 

 

 

By:

/s/ Dawn M. Jaffray

 

 

Dawn M. Jaffray

 

 

Senior Vice President and Chief Financial

Officer

 

 

 

 

Address for Notices:

 

 

 

 

298 North Wiget Lane

Walnut Creek, California 94598

Attention: (925) 951-4011

Facsimile: (925) 934-5489

 

--------------------------------------------------------------------------------

 

 

WESTAFF SUPPORT, INC.,
a California corporation

 

 

 

 

 

By:

/s/ Dawn Jaffray

 

 

Dawn Jaffray

 

 

Senior Vice President and Chief Financial

Officer

 

 

 

 

Address for Notices:

 

 

 

 

298 North Wiget Lane

Walnut Creek, California 94598

Attention: (925) 951-4011

Facsimile: (925) 934-5489

 

--------------------------------------------------------------------------------

 

 

MEDIAWORLD INTERNATIONAL,
a California corporation

 

 

 

 

 

By:

/s/ Dawn Jaffray

 

 

Dawn Jaffray

 

 

Senior Vice President and Chief Financial

Officer

 

 

 

 

Address for Notices:

 

 

 

 

298 North Wiget Lane

Walnut Creek, California 94598

Attention: (925) 951-4011

Facsimile: (925) 934-5489

 

--------------------------------------------------------------------------------

 

U.S. BANK NATIONAL ASSOCIATION,

 

as Agent

 

 

 

By:

/s/ Susan V. Freed

 

 

Susan V. Freed

 

 

Vice President

 

 

 

 

Address for Notices:

 

U.S. Bank Business Credit
633 West Fifth Street, 29 Floor
Los Angeles, California 90071
Attention: Susan V. Freed
Telephone: (213) 615-6404
Facsimile: (213) 615-6594

 

 

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