EXHIBIT 10.8.31
CONTINUING
GUARANTY
[Subsidiaries]
FOR VALUE
RECEIVED, and in consideration of any loan or other financial
accommodation heretofore or hereafter at any time made or granted
to WESTAFF (USA), INC., a California corporation (“
Borrower ”), by Agent or any Lender under (and as such
terms are defined in) the Financing Agreement referred to below,
the undersigned, WESTAFF SUPPORT, INC., a California 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 and prompt payment and performance when due, whether by
acceleration or otherwise, and at all times thereafter, of all
present and future Obligations of Borrower to Agent or any Lender
or any other Secured Party (collectively, the “ Benefited
Parties ”) under (and as such terms are defined in ) the
Financing Agreement dated as of even date herewith, by and among
Borrower, WESTAFF, INC., a Delaware corporation and the sole
shareholder of Borrower, as Parent Guarantor (“ Parent
Guarantor ”), the Lenders party thereto, and U.S. BANK
NATIONAL ASSOCIATION, as Agent (as the same may hereafter from time
to time be amended, modified, or restated, the “ Financing
Agreement ”), and each of the other agreements, documents
and instruments entered into by Borrower in connection therewith
(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 of
collection. Capitalized terms used but not defined herein
shall have the meaning given to them in the Financing
Agreement.
In the event of
any default by Borrower in making payment of, or default by
Borrower in performance of, any of the Liabilities, each Guarantor
agrees on demand by Agent, on behalf of all of the Benefited
Parties, to pay and perform all of the Liabilities as are then or
thereafter become due and owing to any or all of the Benefited
Parties or are to be performed by Borrower under the terms of the
Loan Documents. Each Guarantor further agrees to pay
all expenses (including Attorneys’ Fees) paid or incurred by
Agent, on behalf of the Benefited Parties, in endeavoring to
collect the Liabilities, or any part thereof, and in enforcing this
Guaranty.
Notwithstanding
any provision to the contrary contained herein or in any other of
the Loan Documents, the obligations of each Guarantor under this
Guaranty and the other Loan Documents shall be limited to an
aggregate amount equal to the largest amount that would not render
such obligations subject to avoidance under the Insolvency Laws or
any comparable provisions of any applicable state law.
2.
Continuing Nature of
Guaranty and Liabilities . This Guaranty shall be continuing
and shall not be discharged, impaired or affected by:
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(a)
the insolvency of Borrower
or the payment in full of all of the Liabilities at any time or
from time to time;
(b)
the power or authority or
lack thereof of Borrower to incur the Liabilities;
(c)
the validity or invalidity
of any of the Loan Documents or the documents securing the
same;
(d)
the existence or
non-existence of Borrower as a legal entity;
(e)
any transfer by Borrower
of all or any part of any collateral in which Agent has been
granted a lien or security interest pursuant to the Loan
Documents;
(f)
any statute of limitations
affecting the liability of either or both Guarantors under this
Guaranty or the Loan Documents or the ability of Agent to enforce
this Guaranty or any provision of the Loan Documents; or
(g)
any right of offset,
counterclaim or defense of either or both Guarantors, including,
without limitation, those which have been waived by such
Guarantor(s) pursuant to Paragraph 6(g)
hereof.
3.
Insolvency of Borrower
or Guarantor(s) . Without limiting the generality of
any other provision hereof, each Guarantor agrees that, in the
event of the dissolution or insolvency of Borrower or either or
both Guarantors or the inability of Borrower or either or both
Guarantors to pay its debts as they mature, or an assignment by
Borrower or either or both Guarantors for the benefit of creditors,
or the institution of any proceeding by or against Borrower or
either or both Guarantors alleging that Borrower or either or both
Guarantors is insolvent or unable to pay its debts as they mature,
each Guarantor will, jointly and severally, pay to Agent forthwith
the full amount which would be payable hereunder by such Guarantor
if all of the Liabilities were then due and payable, whether or not
such event occurs at a time when any of the Liabilities are
otherwise due and payable.
4.
Payment of the
Liabilities . Any amounts received by Agent from
whatever source on account of the Liabilities may be applied by
Agent toward the payment of such of the Liabilities in the order of
application set forth in the Financing Agreement. Each
Guarantor agrees that, if at any time all or any part of any
payment theretofore applied by Agent to any of the Liabilities is
or must be rescinded or returned by Agent for any reason whatsoever
(including, without limitation, the insolvency, bankruptcy or
reorganization of Borrower), such Liabilities shall, for the
purposes of this Guaranty and to the extent that such payment is or
must be rescinded or returned, be deemed to have continued in
existence notwithstanding such application by Agent, and this
Guaranty shall continue to be effective or be reinstated, as the
case may be, as to such Liabilities, all as though such application
by Agent had not been made. The guaranty set forth in Section 1
of this Guaranty is a guaranty of payment and not of collection, is
a continuing guarantee, and shall apply to all Liabilities whenever
arising.
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5.
Permitted Actions of
Agent . Agent, on behalf of the Benefited
Parties, may from time to time, in its sole discretion and without
notice to Guarantors, take any or all of the following
actions:
(a)
retain or obtain a
security interest in any assets of Borrower or any third party to
secure any of the Liabilities or any obligations of either or both
Guarantors hereunder;
(b)
retain or obtain the
primary or secondary obligation of any obligor or obligors, in
addition to Guarantors, with respect to any of the
Liabilities;
(c)
extend or renew for one or
more periods (whether or not longer than the original period),
alter or exchange any of the Liabilities;
(d)
waive, ignore or forbear
from taking action or otherwise exercising any of its default
rights or remedies with respect to any default by Borrower under
the Loan Documents;
(e)
release, waive or
compromise any obligation of either or both Guarantors hereunder or
any obligation of any nature of any other obligor primarily or
secondarily obligated with respect to any of the
Liabilities;
(f)
release its security
interest in, or surrender, release or permit any substitution or
exchange for, all or any part of any collateral now or hereafter
securing any of the Liabilities or any obligation hereunder, or
extend or renew for one or more periods (whether or not longer than
the original period) or release, waive, compromise, alter or
exchange any obligations of any nature of any obligor with respect
to any such property; and
(g)
upon the occurrence and at
any time or from time to time during the continuance of an Event of
Default, demand payment of any of the Liabilities from either or
both Guarantors, whether or not Agent shall have exercised any of
its rights or remedies with respect to any property securing any of
the Liabilities or any obligation hereunder or proceeded against
any other obligor primarily or secondarily liable for payment or
performance of any of the Liabilities.
6.
Specific
Waivers .
Without limiting the generality of any other provision of this
Guaranty, each Guarantor hereby expressly waives:
(a)
notice of the acceptance
by Agent of this Guaranty;
(b)
notice of the existence,
creation, payment, nonpayment, performance or nonperformance of all
or any of the Liabilities;
(c)
presentment, demand,
notice of dishonor, protest, notice of protest and all other
notices whatsoever with respect to the payment or performance of
the Liabilities or the amount thereof or any payment or performance
by such Guarantor hereunder;
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(d)
all diligence in
collection or protection of or realization upon the Liabilities or
any thereof, any obligation hereunder or any security for or
guaranty of any of the foregoing;
(e)
any right to direct or
affect the manner or timing of Agent’s enforcement of its
rights or remedies;
(f)
any and all defenses which
would otherwise arise upon the occurrence of any event or
contingency described in Paragraph 1 hereof or upon the
taking of any action by Agent permitted hereunder;
(g)
any defense, right of
set-off, claim or counterclaim whatsoever and any and all other
rights, benefits, protections and other defenses available to such
Guarantor now or at any time hereafter, including, without
limitation, under California Civil Code Sections 2787 to 2855,
inclusive, and California Code of Civil Procedure Sections 580a,
580b, 580d or 726, and all successor sections; and
(h)
all other principles or
provisions of law, if any, that conflict with the terms of this
Guaranty, including, without limitation, the effect of any
circumstances that may or might constitute a legal or equitable
discharge of a guarantor or surety.
7.
Irrevocability . To the extent permitted under
applicable law, each Guarantor hereby further waives all rights to
revoke this Guaranty at any time, and all rights to revoke any
agreement executed by such Guarantor at any time to secure the
payment and performance of such Guarantor’s obligations under
this Guaranty.
8.
Statutory Waiver of
Rights and Defenses Regarding Election of Remedies
. Each
Guarantor waives all rights and defenses arising out of an election
of remedies by Agent, even though that election of remedies, such
as a nonjudicial foreclosure with respect to security for a
guaranteed obligation, has destroyed such Guarantor’s rights
of subrogation and reimbursement against Borrower by the operation
of any applicable law, including without limitation
Section 580d of the California Code of Civil Procedure, or
otherwise.
9.
Subrogation
. Neither
Guarantor will exercise any rights which it may acquire by way of
subrogation under this Guaranty, by any payment hereunder or
otherwise, until all of the Obligations have been Paid in
Full. If any amount shall be paid to such Guarantor on
account of such subrogation rights at any other time, such amount
shall be held in trust for the benefit of Agent and shall be
forthwith paid to Agent to be credited and applied to the
Liabilities, whether matured or unmatured, in such manner as Agent
shall determine in its sole discretion. Each Guarantor agrees that such
Guarantor shall have no right of recourse to security for the
Liabilities, except through the exercise of rights of subrogation
pursuant to this Paragraph 9 and through the exercise of
rights of contribution pursuant to Paragraph 20 .
10.
Remedies
. Each Guarantor
agrees that, to the fullest extent permitted by law, as between
Guarantors, on the one hand, and Agent and the Benefited Parties,
on the other hand, the Liabilities may be declared to be forthwith
due and payable as provided in the Financing Agreement (and shall
be deemed to have become automatically due and payable in the
circumstances provided in the Financing Agreement) for purposes of
Paragraph 1 of this
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Guaranty
notwithstanding any stay, injunction or other prohibition
preventing such declaration (or preventing the Liabilities from
becoming automatically due and payable) as against any other Person
and that, in the event of such declaration (or the Liabilities
being deemed to have become automatically due and payable), the
Liabilities (whether or not due and payable by any other Person)
shall forthwith become due and payable by Guarantors for purposes
of Paragraph 1 . Each Guarantor acknowledges and
agrees that its and their obligations hereunder are secured in
accordance with the terms of the Security Documents and that Agent
and the Benefited Parties may exercise their remedies thereunder in
accordance with the terms thereof.
11.
Assignments and
Participations with Respect to Benefited Parties’
Rights . Each Benefited Party may, from
time to time, without notice to Guarantors but only in accordance
with the terms of the Financing Agreement, assign or transfer any
or all of its share of the Liabilities or any interest therein,
and/or grant participants in any or all of its share of the
Liabilities or any interest therein, and, notwithstanding any
such assignment or transfer or participation with respect to the
Liabilities or any subsequent assignment or transfer or
participation thereof, the Liabilities shall be and remain the
Liabilities for the purpose of
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