**EXHIBIT10.8.31**

 

**CONTINUINGGUARANTY**

 

**[Subsidiaries]**

 

FOR VALUE RECEIVED, and in consideration of any loanor other financial accommodation heretofore or hereafter at any time made orgranted to WESTAFF (USA), INC., a California corporation (“Borrower”), byAgent or any Lender under (and as such terms are defined in) the FinancingAgreement referred to below, the undersigned, WESTAFF SUPPORT, INC., aCalifornia corporation, and MEDIAWORLD INTERNATIONAL, a California corporation(collectively, “Guarantors,” and each, individually, “Guarantor”),each hereby agree as follows:

 

1.             Guaranty of Obligations.  Each Guarantor unconditionally,absolutely and irrevocably, jointly and severally, guarantees the full andprompt payment and performance when due, whether by acceleration or otherwise,and at all times thereafter, of all present and future Obligations of Borrowerto Agent or any Lender or any other Secured Party (collectively, the “BenefitedParties”) under (and as such terms are defined in ) the Financing Agreementdated as of even date herewith, by and among Borrower, WESTAFF, INC., aDelaware corporation and the sole shareholder of Borrower, as Parent Guarantor(“Parent Guarantor”), the Lenders party thereto, and U.S. BANK NATIONALASSOCIATION, as Agent (as the same may hereafter from time to time be amended,modified, or restated, the “Financing Agreement”), and each of the otheragreements, documents and instruments entered into by Borrower in connectiontherewith (all such Obligations are hereinafter referred to collectively as the“Liabilities”).  This Continuing Guaranty (this “Guaranty”)is a guaranty of payment and performance when due and not a guaranty ofcollection.  Capitalized terms used butnot defined herein shall have the meaning given to them in the FinancingAgreement.

 

In the event of any defaultby Borrower in making payment of, or default by Borrower in performance of, anyof the Liabilities, each Guarantor agrees on demand by Agent, on behalf of allof the Benefited Parties, to pay and perform all of the Liabilities as are thenor thereafter become due and owing to any or all of the Benefited Parties orare to be performed by Borrower under the terms of the Loan Documents.   Each Guarantor further agrees to pay allexpenses (including Attorneys’ Fees) paid or incurred by Agent, on behalf ofthe Benefited Parties, in endeavoring to collect the Liabilities, or any partthereof, and in enforcing this Guaranty.

 

Notwithstanding anyprovision to the contrary contained herein or in any other of the LoanDocuments, the obligations of each Guarantor under this Guaranty and the otherLoan Documents shall be limited to an aggregate amount equal to the largestamount that would not render such obligations subject to avoidance under theInsolvency Laws or any comparable provisions of any applicable state law.

 

2.             Continuing Nature of Guaranty and Liabilities.  This Guaranty shall becontinuing and shall not be discharged, impaired or affected by:

 

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(a)           theinsolvency of Borrower or the payment in full of all of the Liabilities at anytime or from time to time;

 

(b)           thepower or authority or lack thereof of Borrower to incur the Liabilities;

 

(c)           thevalidity or invalidity of any of the Loan Documents or the documents securingthe same;

 

(d)           theexistence or non-existence of Borrower as a legal entity;

 

(e)           anytransfer by Borrower of all or any part of any collateral in which Agent hasbeen granted a lien or security interest pursuant to the Loan Documents;

 

(f)            anystatute of limitations affecting the liability of either or both Guarantorsunder this Guaranty or the Loan Documents or the ability of Agent to enforcethis Guaranty or any provision of the Loan Documents; or

 

(g)           anyright of offset, counterclaim or defense of either or both Guarantors,including, without limitation, those which have been waived by such Guarantor(s) pursuantto Paragraph 6(g) hereof.

 

3.             Insolvency of Borrower or Guarantor(s).  Without limiting thegenerality of any other provision hereof, each Guarantor agrees that, in theevent of the dissolution or insolvency of Borrower or either or both Guarantorsor the inability of Borrower or either or both Guarantors to pay its debts asthey mature, or an assignment by Borrower or either or both Guarantors for thebenefit of creditors, or the institution of any proceeding by or againstBorrower or either or both Guarantors alleging that Borrower or either or bothGuarantors is insolvent or unable to pay its debts as they mature, each Guarantorwill, jointly and severally, pay to Agent forthwith the full amount which wouldbe payable hereunder by such Guarantor if all of the Liabilities were then dueand payable, whether or not such event occurs at a time when any of theLiabilities are otherwise due and payable.

 

4.             Payment of the Liabilities.  Any amounts received byAgent from whatever source on account of the Liabilities may be applied byAgent toward the payment of such of the Liabilities in the order of applicationset forth in the Financing Agreement. Each Guarantor agrees that, if at any time all or any part of anypayment theretofore applied by Agent to any of the Liabilities is or must berescinded or returned by Agent for any reason whatsoever (including, withoutlimitation, the insolvency, bankruptcy or reorganization of Borrower), suchLiabilities shall, for the purposes of this Guaranty and to the extent thatsuch payment is or must be rescinded or returned, be deemed to have continuedin existence notwithstanding such application by Agent, and this Guaranty shallcontinue to be effective or be reinstated, as the case may be, as to suchLiabilities, all as though such application by Agent had not been made.  The guaranty set forth in Section 1of this Guaranty is a guaranty of payment and not of collection, is acontinuing guarantee, and shall apply to all Liabilities whenever arising.

 

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5.             Permitted Actions of Agent.  Agent, on behalf of theBenefited Parties, may from time to time, in its sole discretion and withoutnotice to Guarantors, take any or all of the following actions:

 

(a)           retainor obtain a security interest in any assets of Borrower or any third party tosecure any of the Liabilities or any obligations of either or both Guarantorshereunder;

 

(b)           retainor obtain the primary or secondary obligation of any obligor or obligors, inaddition to Guarantors, with respect to any of the Liabilities;

 

(c)           extendor renew for one or more periods (whether or not longer than the originalperiod), alter or exchange any of the Liabilities;

 

(d)           waive,ignore or forbear from taking action or otherwise exercising any of its defaultrights or remedies with respect to any default by Borrower under the LoanDocuments;

 

(e)           release,waive or compromise any obligation of either or both Guarantors hereunder orany obligation of any nature of any other obligor primarily or secondarilyobligated with respect to any of the Liabilities;

 

(f)            releaseits security interest in, or surrender, release or permit any substitution orexchange for, all or any part of any collateral now or hereafter securing anyof the Liabilities or any obligation hereunder, or extend or renew for one ormore periods (whether or not longer than the original period) or release,waive, compromise, alter or exchange any obligations of any nature of anyobligor with respect to any such property; and

 

(g)           uponthe occurrence and at any time or from time to time during the continuance ofan Event of Default, demand payment of any of the Liabilities from either orboth Guarantors, whether or not Agent shall have exercised any of its rights orremedies with respect to any property securing any of the Liabilities or anyobligation hereunder or proceeded against any other obligor primarily orsecondarily liable for payment or performance of any of the Liabilities.

 

6.             Specific Waivers.  Withoutlimiting the generality of any other provision of this Guaranty, each Guarantorhereby expressly waives:

 

(a)           noticeof the acceptance by Agent of this Guaranty;

 

(b)           noticeof the existence, creation, payment, nonpayment, performance or nonperformanceof all or any of the Liabilities;

 

(c)           presentment,demand, notice of dishonor, protest, notice of protest and all other noticeswhatsoever with respect to the payment or performance of the Liabilities or theamount thereof or any payment or performance by such Guarantor hereunder;

 

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(d)           alldiligence in collection or protection of or realization upon the Liabilities orany thereof, any obligation hereunder or any security for or guaranty of any ofthe foregoing;

 

(e)           anyright to direct or affect the manner or timing of Agent’s enforcement of itsrights or remedies;

 

(f)            anyand all defenses which would otherwise arise upon the occurrence of any eventor contingency described in Paragraph 1 hereof or upon the taking of anyaction by Agent permitted hereunder;

 

(g)           anydefense, right of set-off, claim or counterclaim whatsoever and any and allother rights, benefits, protections and other defenses available to suchGuarantor now or at any time hereafter,including, without limitation, under California Civil Code Sections 2787 to2855, inclusive, and California Code of Civil Procedure Sections 580a, 580b, 580dor 726, and all successor sections; and

 

(h)           allother principles or provisions of law, if any, that conflict with the terms ofthis Guaranty, including, without limitation, the effect of any circumstancesthat may or might constitute a legal or equitable discharge of a guarantor orsurety.

 

7.             Irrevocability.  To the extent permitted under applicablelaw, each Guarantor hereby further waives all rights to revoke this Guaranty atany time, and all rights to revoke any agreement executed by such Guarantor atany time to secure the payment and performance of such Guarantor’s obligationsunder this Guaranty.

 

8.             Statutory Waiver of Rights and Defenses RegardingElection of Remedies.  EachGuarantor waives all rights and defenses arising out of an election of remediesby Agent, even though that election of remedies, such as a nonjudicialforeclosure with respect to security for a guaranteed obligation, has destroyedsuch Guarantor’s rights of subrogation and reimbursement against Borrower bythe operation of any applicable law,including without limitation Section 580d of the California Code of CivilProcedure, or otherwise.

 

9.             Subrogation.  Neither Guarantor will exercise anyrights which it may acquire by way of subrogation under this Guaranty, by anypayment hereunder or otherwise, until all of the Obligations have been Paid inFull.  If any amount shall be paid to such Guarantor on account ofsuch subrogation rights at any other time, such amount shall be held in trustfor the benefit of Agent and shall be forthwith paid to Agent to be creditedand applied to the Liabilities, whether matured or unmatured, in such manner asAgent shall determine in its sole discretion.  Each Guarantor agrees that such Guarantorshall have no right of recourse to security for the Liabilities, except throughthe exercise of rights of subrogation pursuant to this Paragraph 9 andthrough the exercise of rights of contribution pursuant to Paragraph 20.

 

10.           Remedies.  EachGuarantor agrees that, to the fullest extent permitted by law, as betweenGuarantors, on the one hand, and Agent and the Benefited Parties, on the otherhand, the Liabilities may be declared to be forthwith due and payable asprovided in the Financing Agreement (and shall be deemed to have becomeautomatically due and payable in the circumstances provided in the FinancingAgreement) for purposes of Paragraph 1 of this 

 

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Guaranty notwithstanding any stay, injunction or otherprohibition preventing such declaration (or preventing the Liabilities frombecoming automatically due and payable) as against any other Person and that,in the event of such declaration (or the Liabilities being deemed to havebecome automatically due and payable), the Liabilities (whether or not due andpayable by any other Person) shall forthwith become due and payable byGuarantors for purposes of Paragraph 1. Each Guarantor acknowledges and agrees that its and their obligationshereunder are secured in accordance with the terms of the Security Documentsand that Agent and the Benefited Parties may exercise their remedies thereunderin accordance with the terms thereof.

 

11.           Assignments and Participations with Respect toBenefited Parties’ Rights.  Each Benefited Party may, from time to time, withoutnotice to Guarantors but only in accordance with the terms of the FinancingAgreement, assign or transfer any or all of its share of the Liabilities or anyinterest therein, and/or grant participants in any or all of its share of theLiabilities or any interest therein, and, notwithstanding any such assignment or transfer or participationwith respect to the Liabilities or any subsequent assignment or transfer orparticipation thereof, the Liabilities shall be and remain the Liabilities forthe purpose of this Guaranty.  Each and every immediate andsuccessive assignee or transferee or participant in accordance with the termsof the Financing Agreement with respect to of any portion of the Liabilities orof any interest therein shall, to the extent of such party’s interest in theLiabilities, be entitled to the benefits of this Guaranty to the same extent asif such assignee or transferee or participant were Agent.

 

12.           Indulgences Not Waivers.  No delay in the exercise of any right orremedy shall operate as a waiver thereof, and no single or partial exercise byAgent of any right or remedy shall preclude other or further exercise thereofor the exercise of any other right or remedy; nor shall any modification orwaiver of any of the provisions of this Guaranty be binding upon Agent, exceptas expressly set forth in a writing duly signed and delivered byAgent.  No action of Agent permitted hereunder shall in any wayaffect or impair the rights of Agent or the obligations of Guarantors underthis Guaranty.

 

13.           Financial Condition of Borrower.  Each Guarantor representsand warrants that it is fully aware of the financial condition of Borrower, andeach Guarantor delivers this Guaranty based solely upon its own independentinvestigation of Borrower’s financial condition and in no part upon anyrepresentation or statement of Agent or any Lender with respectthereto.  Each Guarantor further represents and warrants that it isin a position to and hereby does assume full responsibility for obtaining such additionalinformation concerning Borrower’s financial condition as each Guarantor maydeem material to his obligations hereunder, and such Guarantor is not relyingupon, nor expecting Agent to furnish such Guarantor any information in Agent’sor any Lender’s possession concerning Borrower’s financial condition orconcerning any circumstances bearing on the existence or creation, or the riskof nonpayment or nonperformance of the Liabilities.

 

Each Guarantor hereby waives any duty on the part ofAgent to disclose to such Guarantor any facts Agent or any other BenefitedParty may now or hereafter know about Borrower, regardless of whether Agent hasreason to believe that any such facts materially increase the risk beyond thatwhich such Guarantor intends to assume or has reason to believe that such factsare unknown to such Guarantor.

 

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Each Guarantor hereby knowingly accepts the full rangeof risk encompassed within a contract of “continuing guaranty” which includes,without limitation, the possibility that Borrower will contract for additionalindebtedness for which such Guarantor may be liable hereunder after Borrower’sfinancial condition or ability to pay its lawful debts when they fall due hasdeteriorated.

 

14.           Representations and Warranties.  Each Guarantor severallyrepresents and warrants to Agent, for the benefit of Agent and each of theother Benefited Parties, as to itself that each of the following statements isaccurate and complete as of the date of this Guaranty:

 

(a)           thisGuaranty has been duly executed and delivered by such Guarantor and constitutesa legal, valid and binding obligation of such Guarantor, enforceable againstsuch Guarantor in accordance with its terms, except as limited by bankruptcy,insolvency or other laws of general application relating to or affecting theenforcement of creditors’ rights generally;

 

(b)           theexecution, delivery and performance of this Guaranty do not (i) violateany provisions of law or any order of any court or other agency of government(each, a “Requirement of Law”), (ii) contravene any provision ofany Applicable Agreement to which such Guarantor is a party or by which suchGuarantor’s assets are bound (each, a “Contractual Obligation”), or (iii) resultin the creation or imposition of any lien, charge or encumbrance of any natureupon any property, asset or revenue of such Guarantor, other than liens infavor of Agent and other Permitted Liens;

 

(c)           allconsents, approvals, orders and authorizations of, and registrations,declarations and filings with, any governmental agency or authority or otherperson or entity, if any, which are required to be obtained in connection withthe execution and delivery of this Guaranty or the performance of suchGuarantor’s obligations hereunder have been obtained, and each is in full forceand effect;

 

(d)           SuchGuarantor has paid all taxes and other charges imposed by any governmentalagency or authority due and payable by such Guarantor other than those whichare being challenged in good faith by appropriate proceedings;

 

(e)           SuchGuarantor is not in violation of any Requirement of Law or ContractualObligation other than any violation the consequences of which could not have amaterial adverse effect on such Guarantor’s ability to perform his obligationshereunder (a “Material Adverse Effect”); and

 

(f)            noaction, proceeding, investigation or litigation is pending or, to the knowledgeof such Guarantor, overtly threatened in writing against such Guarantor by anyperson or entity which would reasonably be expected to result in a MaterialAdverse Effect.

 

15.           Binding Upon Successors.  This Guaranty shall be binding upon eachGuarantor and its successors and assigns and shall inure to the benefit of theBenefited Parties and their respective successors and permitted assigns.

 

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All references herein to Borrower shall be deemed toinclude its successors and assigns, and all references herein to Guarantor orGuarantors shall be deemed to include Guarantor or Guarantors and theirsuccessors and assigns.

 

In addition and notwithstanding anything to thecontrary contained in this Guaranty or in any other agreement, document orinstrument between or among any of Agent, the Lenders, Borrower, Guarantors orany third party, the obligations of Guarantors with respect to the Liabilitiesshall be joint and several with any other person or entity that now orhereafter executes a guaranty of any of the Liabilities separate from thisGuaranty.

 

16.           Notices.  All notices required or permitted to begiven hereunder shall be given in accordance with the notices procedures setforth in Section 15.7 of the Financing Agreement.

 

17.           Governing Law; Additional Waivers.  This Guaranty has beendelivered and shall be governed by and construed in accordance with theinternal laws (as opposed to the conflicts of law provisions) of the State ofCalifornia.

 

EACH GUARANTOR AND AGENT HEREBY

 

(i)         WAIVES, TO THEEXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT TO A TRIAL BY JURY IN ANYACTION TO ENFORCE OR DEFEND ANY MATTER ARISING FROM OR RELATED TO THISGUARANTY;

 

(ii)         IRREVOCABLYSUBMITS TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED IN SANFRANCISCO COUNTY, CALIFORNIA, OVER ANY ACTION OR PROCEEDING TO ENFORCE ORDEFEND ANY MATTER ARISING FROM OR RELATED TO THIS GUARANTY;

 

(iii)         IRREVOCABLYWAIVES, TO THE FULLEST EXTENT GUARANTOR MAY EFFECTIVELY DO SO, THE DEFENSEOF AN INCONVENIENT FORUM TO THE MAINTENANCE OF ANY SUCH ACTION OR PROCEEDING;

 

(iv)         agrees that afinal judgment in any such action or proceeding shall be conclusive and may beenforced in any other jurisdictions by suit on the judgment or in any othermanner provided by law; and

 

(v)         agrees not toinstitute any legal action or proceeding against the other party or itsdirectors, officers, employees, agents or property concerning any matterarising out of or relating to this Guaranty in any court other than one locatedin San Francisco County, California.

 

Nothing herein shall affect or impair Agent’s right toserve legal process in any manner permitted by law or Agent’s right to bringany action or proceeding against such Guarantor or its property in the courtsof any other jurisdiction.  Whereverpossible each provision of this Guaranty shall be interpreted as to beeffective and valid under applicable law, 

 

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but if any provision of thisGuaranty shall be prohibited by or invalid under such law, such provision shallbe ineffective only to the extent of such prohibition or invalidity, withoutinvalidating the remainder of such provision or the remaining provisions ofthis Guaranty.

 

18.           Judicial Reference.

 

(a)           Guarantorsand Agent prefer that any dispute among them be resolved in litigation subjectto a jury trial waiver as set forth in the Transaction Documents (definedbelow), but the California Supreme Court has held that pre-dispute waivers ofthe right to a trial by jury not authorized by statute are unenforceable.  This judicial reference provision will beapplicable until:  (i) theCalifornia Supreme Court holds that a pre-dispute jury trial waiver provisionsimilar to that contained in the Transaction Documents is valid or enforceable;or (ii) the California Legislature enacts a statute which becomes law,authorizing pre-dispute jury trial waivers of the type in the TransactionDocuments and, as a result, such waivers become enforceable.

 

(b)           Otherthan (i) nonjudicial foreclosure of security interests in personalproperty, (ii) the appointment of a receiver or (iii) the exercise ofother provisional remedies (any of which may be initiated pursuant toapplicable law), any controversy, dispute or claim (each, a “Claim”)among either or both Guarantors and Agent arising out of or relating to thisGuaranty or any other document, instrument or agreement among either or bothGuarantors and Agent (collectively in this Section, the “TransactionDocuments”), will be resolved, notwithstanding anything to the contrarycontained in the Transaction Documents, by a reference proceeding in Californiain accordance with the provisions of Section 638 et seq. of the CaliforniaCode of Civil Procedure (“CCP”), or their successor sections, whichshall constitute the exclusive remedy for the resolution of any Claim,including whether the Claim is subject to the reference proceeding.  Except as provided in Paragraph 17 ofthis Guaranty or as otherwise provided in the Transaction Documents, venue forthe reference proceeding will be in the Superior Court or Federal DistrictCourt in the County or District where the real property, if any, is located orin a County or District where venue is otherwise appropriate under applicablelaw (the “Court”).

 

(c)           Thereferee shall be a retired Judge or Justice selected by mutual writtenagreement of the applicable Guarantor(s) and Agent.  If such Guarantor(s) and Agent do notagree, the referee shall be selected by the Presiding Judge of the Court (orhis or her representative).  A request forappointment of a referee may be heard on an ex parte or expedited basis, andGuarantors and Agent agree that irreparable harm would result if ex parterelief is not granted.  The referee shallbe appointed to sit with all the powers provided by law.  Pending appointment of the referee, the Courthas power to issue temporary or provisional remedies.

 

(d)           Guarantorsand Agent agree that time is of the essence in conducting the referenceproceedings. Accordingly, the referee shall be requested, subject to change inthe time periods specified herein for good cause shown, to (a) set the matterfor a status and trial-setting conference within fifteen (15) days afterthe date of selection of the referee, (b) if practicable, try all issues of lawor fact within ninety (90) days after 

 

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the date ofthe conference and (c) report a statement of decision withintwenty (20) days after the matter has been submitted for decision.

 

(e)           Thereferee will have power to expand or limit the amount and duration ofdiscovery.  The referee may set or extenddiscovery deadlines or cutoffs for good cause, including a party’s failure toprovide requested discovery for any reason whatsoever.  Unless otherwise ordered based upon good causeshown, neither Guarantors nor Agent shall be entitled to “priority” inconducting discovery, depositions may be taken by Guarantors and Agent uponseven (7) days written notice, and all other discovery shall beresponded to within fifteen (15) days after service.  All disputes relating to discovery whichcannot be resolved by Guarantors and Agent shall be submitted to the refereewhose decision shall be final and binding.

 

(f)            Exceptas expressly set forth in this Guaranty, the referee shall determine the mannerin which the reference proceeding is conducted including the time and place ofhearings, the order of presentation of evidence, and all other questions thatarise with respect to the course of the reference proceeding.  All proceedings and hearings conducted beforethe referee, except for trial, shall be conducted without a court reporter,except that when any party so requests, a court reporter will be used at anyhearing conducted before the referee, and the referee will be provided acourtesy copy of the transcript.  Theparty making such a request shall have the obligation to arrange for and paythe court reporter.  Subject to thereferee’s power to award costs to the prevailing party, the applicableGuarantor(s) and Agent will equally share the cost of the referee and thecourt reporter at trial.

 

(g)           Thereferee shall be required to determine all issues in accordance with existingcase law and the statutory laws of the State of California.  The rules of evidence applicable toproceedings at law in the State of California will be applicable to thereference proceeding.  The referee shallbe empowered to enter equitable as well as legal relief, provide all temporaryor provisional remedies, enter equitable orders that will be binding on theparties and rule on any motion which would be authorized in a trial,including without limitation motions for summary judgment or summaryadjudication.  The referee shall issue adecision and pursuant to CCP §644 the referee’s decision shall be entered bythe Court as a judgment or an order in the same manner as if the action hadbeen tried by the Court.  The finaljudgment or order or from any appealable decision or order entered by thereferee shall be fully appealable as provided by law.  Guarantors and Agent reserve the right tofindings of fact, conclusions of laws, a written statement of decision, and theright to move for a new trial or a different judgment, which new trial, ifgranted, is also to be a reference proceeding under this provision.

 

(h)           Ifthe enabling legislation which provides for appointment of a referee isrepealed (and no successor statute is enacted) or if a reference procedure isnot available to the parties for any reason, any dispute among either or bothGuarantors and Agent that would otherwise be determined by reference procedurewill be resolved and determined by arbitration. The arbitration will be conducted by a retired judge or Justice, inaccordance with the California Arbitration Act § 1280 through§ 1294.2 of the CCP as amended from time to time.

 

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(i)            GUARANTORSAND AGENT RECOGNIZE AND AGREE THAT ALL DISPUTES RESOLVED UNDER THIS REFERENCEPROVISION WILL BE DECIDED BY A REFEREE AND NOT BY A JURY. AFTER CONSULTING (ORHAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR OWN CHOICE,GUARANTORS AND AGENT EACH KNOWINGLY AND VOLUNTARILY AND FOR THEIR MUTUALBENEFIT AGREE THAT THIS REFERENCE PROVISION WILL APPLY TO ANY DISPUTE BETWEENTHEM WHICH ARISES OUT OF OR IS RELATED TO THIS GUARANTY OR THE OTHERTRANSACTION DOCUMENTS.

 

19.           ADVICE OF COUNSEL.  GUARANTORS ACKNOWLEDGE THAT THEY HAVEEITHER OBTAINED THE ADVICE OF COUNSEL OR HAVE HAD THE OPPORTUNITY TO OBTAINSUCH ADVICE IN CONNECTION WITH THE TERMS AND PROVISIONS OF THIS GUARANTY.

 

20.           Contribution.  Guarantorshereby agree as among themselves that, if any Guarantor shall make an ExcessPayment (as defined below), such Guarantor shall have a right of contributionfrom each other Guarantor in an amount equal to such other Guarantor’sContribution Share (as defined below) of such Excess Payment.  The payment obligations of any Guarantorunder this Paragraph 20 shall be subordinate and subject in right ofpayment to the Liabilities until such time as the Liabilities have been paid infull, and no Guarantor shall exercise any right or remedy under this Paragraph20 against any other Guarantor until such Liabilities have been paid infull.  For purposes of this Paragraph20, (a) “Excess Payment” shall mean the amount paid by any Guarantorin excess of its Ratable Share of any Guaranteed Obligations; (b) “RatableShare” shall mean, for any Guarantor in respect of any payment ofLiabilities, the ratio (expressed as a percentage) as of the date of suchpayment of Guaranteed Obligations of (i) the amount by which the aggregatepresent fair salable value of all of its assets and properties exceeds theamount of all debts and liabilities of such Guarantor (including contingent,subordinated, unmatured, and unliquidated liabilities, but excluding theobligations of such Guarantor hereunder) to (ii) the amount by which theaggregate present fair salable value of all assets and other properties of allof the Credit Parties exceeds the amount of all of the debts and liabilities(including contingent, subordinated, unmatured, and unliquidated liabilities,but excluding the obligations of the Credit Parties hereunder) of the CreditParties; (c) “Contribution Share” shall mean, for any Guarantor inrespect of any Excess Payment made by the other Guarantor, the ratio (expressedas a percentage) as of the date of such Excess Payment of (i) the amountby which the aggregate present fair salable value of all of its assets andproperties exceeds the amount of all debts and liabilities of such Guarantor(including contingent, subordinated, unmatured, and unliquidated liabilities,but excluding the obligations of such Guarantor hereunder) to (ii) theamount by which the aggregate present fair salable value of all assets andother properties of the Credit Parties other than the maker of such ExcessPayment exceeds the amount of all of the debts and liabilities (includingcontingent, subordinated, unmatured, and unliquidated liabilities, butexcluding the obligations of the Credit Parties) of the Credit Parties otherthan the maker of such Excess Payment; and (d) “Guaranteed Obligations”shall mean the Liabilities guaranteed by Guarantors pursuant to Paragraph 1of this Guaranty.  This Paragraph 20shall not be deemed to affect any right of subrogation, indemnity,reimbursement or contribution that any Guarantor may have under any applicablelaw against Borrower in respect of any payment of Guaranteed Obligations.

 

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21.           Entire Agreement.  This Guaranty contains the completeunderstanding of the parties hereto with respect to the subject matterherein.  Each Guarantor acknowledges that it is not relying upon anystatements or representations of Agent not contained in this Guaranty and thatsuch statements or representations, if any, are of no force or effect and arefully superseded by this Guaranty.  This Guaranty may only bemodified by a writing executed by Guarantors and Agent.

 

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IN WITNESS WHEREOF, Guarantors have executed thisGuaranty as of February 14, 2008.

 

 
|   | “Guarantors”                              |
|--------|-----------------------------------------------------|
|   |                                                |
|   | WESTAFF SUPPORT, INC., a California

corporation    |
|   | ** **                                          |
|   | By:                                                 | /s/  Dawn Jaffray |
|   |                                                | Dawn  Jaffray |
|   |                                                | Senior  Vice President and Chief

Financial  Officer |
|   |                                                |   |
|   | MEDIAWORLD INTERNATIONAL, a

California corporation |
|   | ** **                                          |
|   | By:                                                 | /s/  Dawn Jaffray |
|   |                                                | Dawn  Jaffray |
|   |                                                | Senior  Vice President and Chief

Financial  Officer |

 

 
| ACCEPTED BY:                     |               |
|----------------------------------|--------------------|
|                             |               |
| U.S. BANK NATIONAL

ASSOCIATION, |               |
| as Agent                         |               |
|                             |               |
| By:                              | /s/ Susan V. Freed |   |
|                             | Susan V. Freed     |   |
|                             | Vice President     |   |

 

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