News Releases

WALNUT CREEK, CA, Tuesday, May 21, 2002
Westaff, Inc. (NASDAQ:WSTF) announced today that it has closed a new $65 million credit agreement. The agreement consists of a $60 million secured Revolving Credit Facility and a $5 million Term Loan Facility for Westaff and certain of its subsidiaries, including Westaff (U.K.) Limited and Westaff (Australia) Pty Limited.

The new, five-year financing structure was syndicated through GE Capital as the Lead Arranger. GE Capital has committed to $40 million of the facility and Bank of America, N.A., will provide the remaining $25 million as Documentation Agent. The borrowings are based upon the available collateral borrowing base of Westaff and certain of its domestic and foreign subsidiaries.

"We are very pleased with our new facility from GE Capital and Bank of America as it provides Westaff with a complete, solid international financing structure that will meet both our short-term and long-term financing needs," said Dwight S. Pedersen, President and Chief Executive Officer of Westaff. "With this financing structure in place, we will be able to focus even more of our efforts on increasing sales and market share, enhancing the training, skills and quality of our workforce, and improving our service and service delivery.

"We see this as a clear sign of confidence in Westaff's strategy and ability to execute going forward," Pedersen said. "We look forward to partnering with GE Capital and continuing our long-standing partnership with Bank of America."

Westaff, a leading provider of temporary office and light industrial staff, closed the new facility on Friday, May 17.

"We are delighted to be able to establish a relationship with Westaff that will accommodate their business needs today and into the future," said GE Capital Senior Vice President Allen Prince.

The total $65 million five-year facility is replacing Westaff's existing revolving credit facility as well as its $30 million senior secured notes. It also includes a subfacility for up to $35 million for letters of credit to support the Company's workers' compensation program. In connection with the new facility, Westaff has also arranged for $3 million in unsecured subordinated financing.

Westaff provides employment opportunities and staffing services for businesses in global markets. With headquarters in Walnut Creek, California, Westaff annually employs approximately 175,000 people and services more than 20,000 clients from more than 330 offices located throughout the United States, the United Kingdom, Australia, New Zealand, Norway and Denmark. Westaff achieved fiscal 2001 system revenues of more than $580 million. For more information, please visit our Web site at www.westaff.com.

This press release contains forward-looking statements regarding future events and future performance of the Company that involve risks and uncertainties that could cause actual results to differ materially. We refer you to documents that the Company files from time to time with the Securities and Exchange Commission, such as Form 10-K, Form 10-Q and Form 8-K reports. Those documents contain a description of certain factors that could cause actual results to differ from current expectations and the forward-looking statements in this press release. Westaff is not obligated to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.