1

SCHEDULE 14A
INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO.  )

FILED BY THE REGISTRANT [X]

FILED BY A PARTY OTHER THAN THE REGISTRANT [ ]

CHECK THE APPROPRIATE BOX:

[ ] PRELIMINARY PROXY STATEMENT
[ ] CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE
14a-6(e)(2))
[X] DEFINITIVE PROXY STATEMENT 
[ ] DEFINITIVE ADDITIONAL MATERIALS
[ ] SOLICITING MATERIAL PURSUANT TO SECTION 240.14a-11(c) OR SECTION 240.14a-12

PIA MERCHANDISING SERVICES, INC.
--------------------------------------------------------------------------------
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

N/A
--------------------------------------------------------------------------------
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)

PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):

[ ]     NO FEE REQUIRED
[X]     FEE COMPUTED ON TABLE BELOW PER EXCHANGE ACT RULES 14a-6(i)(1) AND 0-11.

1)      TITLE OF EACH CLASS OF SECURITIES TO WHICH TRANSACTION APPLIES:
SPAR ACQUISITION, INC. ("SAI")
------------------------------------------------------------------------

2)      AGGREGATE NUMBER OF SECURITIES TO WHICH TRANSACTION APPLIES:
12,970,978(a)
------------------------------------------------------------------------

3)      PER UNIT PRICE OR OTHER UNDERLYING VALUE OF TRANSACTION COMPUTED
PURSUANT TO EXCHANGE ACT RULE 0-11 (SET FORTH THE AMOUNT ON WHICH THE
FILING FEE IS CALCULATED AND STATE HOW IT WAS DETERMINED): $ 43,237(b)
------------------------------------------------------------------------

4)      PROPOSED MAXIMUM AGGREGATE VALUE OF TRANSACTION:
$ 43,237(b)
------------------------------------------------------------------------

5)      TOTAL FEE PAID:
$ 9.00(c)
------------------------------------------------------------------------

(a)     BASED ON 12,970,978 THE ESTIMATED MAXIMUM NUMBER OF SHARES OF
SAI COMMON STOCK AND SHARES OF SAI COMMON STOCK UNDERLYING
OPTIONS TO PURCHASE SAI COMMON STOCK THAT WILL BE OUTSTANDING
IMMEDIATELY PRIOR TO THE MERGER.

(b)     CALCULATED PURSUANT TO EXCHANGE ACT RULES 0-11(c)(1)(i) AND
0-11(a)(4), BASED UPON ONE THIRD OF THE PAR VALUE OF SAI COMMON
STOCK TO BE ACQUIRED.

(c)     PURSUANT TO EXCHANGE ACT RULES 14a-6(i)(1) AND 0-11, THE FILING
FEE REPRESENTS 1/50TH OF ONE PERCENT OF THE VALUE OF THE SAI
SECURITIES TO BE ACQUIRED BY THE REGISTRANT IN THE PROPOSED
TRANSACTION.

[X]     FEE PAID PREVIOUSLY WITH PRELIMINARY MATERIALS.
[ ]     CHECK BOX IF ANY PART OF THE FEE IS OFFSET AS PROVIDED BY EXCHANGE ACT
RULE 0-11(a)(2) AND IDENTIFY THE FILING FOR WHICH THE OFFSETTING FEE WAS
PAID PREVIOUSLY. IDENTIFY THE PREVIOUS FILING BY REGISTRATION STATEMENT
NUMBER, OR THE FORM OR SCHEDULE AND THE DATE OF ITS FILING.
------------------------------------------------------------------------

1)      AMOUNT PREVIOUSLY PAID:
------------------------------------------------------------------------

2)      FORM, SCHEDULE OR REGISTRATION STATEMENT NO.:
------------------------------------------------------------------------

3)      FILING PARTY:
------------------------------------------------------------------------

4)      DATE FILED:
------------------------------------------------------------------------

2

PIA MERCHANDISING SERVICES, INC.

19900 MACARTHUR BOULEVARD, SUITE 900
IRVINE, CALIFORNIA 92612

Dear Stockholder:

You are cordially invited to attend an Annual Meeting of the stockholders
of PIA Merchandising Services, Inc. ("PIA"), which will be held at 9:00 a.m.,
Pacific Time on Thursday, July 8, 1999 (the "Annual Meeting"), at PIA
Merchandising Services, Inc., 19900 MacArthur Boulevard, Suite 900, Irvine,
California 92612.

At the Annual Meeting, you will be asked to consider and vote upon
proposals to:

1. Approve (i) the issuance of shares of PIA common stock to Robert G.
Brown and William H. Bartels (together, the "SAI Principals"), and the
other stockholders (collectively with the SAI Principals, the "SAI
Stockholders") of SPAR Acquisition, Inc. ("SAI"), and (ii) the issuance of
options ("Substitute Options") to purchase 134,114 shares of PIA common
stock to holders of SAI options, in exchange for their respective SAI
shares and SAI options (collectively, the "Share/Option Issuance") as
consideration for the merger (the "Merger") of a subsidiary of PIA with and
into SAI;

2. Amend PIA's Certificate of Incorporation to increase the number of
authorized shares of PIA common stock from 15 million to 47 million
("Charter Amendment No. 1");

3. Amend PIA's Certificate of Incorporation to delete the prohibition
on stockholder action by written consent without a meeting under Delaware
law ("Charter Amendment No. 2");

4. Amend PIA's Certificate of Incorporation to change the name of PIA
Merchandising Services, Inc. to "SPAR Group, Inc." ("Charter Amendment No.
3" and together with Charter Amendment Nos. 1 and 2, the "Pre-Merger
Charter Amendments");

5. Authorize an amendment, if deemed necessary by the PIA Board of
Directors (the "PIA Board") in its sole discretion, to PIA's Certificate of
Incorporation to effect a reverse stock split of the issued and outstanding
shares of PIA common stock, on the basis of one of the following ratios:
one share in exchange for every two issued and outstanding shares, one
share in exchange for every three issued and outstanding shares or one
share in exchange for every four issued and outstanding shares, with the
PIA Board having the discretion to determine the appropriate ratio to use
immediately prior to effecting the reverse stock split (the "Reverse Split
Proposal");

6. Amend PIA's Amended and Restated 1995 Stock Option Plan, subject to
the consummation of the Merger, to increase the number of shares of PIA
common stock reserved for issuance upon exercise of stock options granted
thereunder from 1.3 million to 3.5 million (the "Option Plan Amendment");
and

7. Elect seven directors to serve on the PIA Board until the
consummation of the Merger, or if the Merger is not consummated, until such
time as their successors are duly elected and qualified. In connection with
the consummation of the Merger, however, if elected, each of the nominees
for director other than Messrs. Patrick W. Collins and J. Christopher Lewis
has agreed to resign from the PIA Board, and Messrs. Collins and Lewis will
appoint the two SAI Principals (Robert G. Brown and William H. Bartels) and
Robert O. Aders to fill three of the five remaining vacancies on the PIA
Board.

Each of these proposals is described more fully in the accompanying Notice
of Annual Meeting of Stockholders and Proxy Statement. The PIA Board believes
that the Merger and the transactions contemplated thereby will provide certain
benefits to PIA stockholders but will also be subject to certain risks as more
fully described in the Proxy Statement. For a discussion of the anticipated
benefits of the Merger please refer to the section entitled "PIA's Reasons for
the Merger" contained in the description of Proposal I in the Proxy Statement.
For a description of the material risks associated with the Merger and the
transactions contemplated thereby please refer to the section entitled "Risk
Factors" contained in the Proxy Statement.

The Merger will result in a change in control of PIA. The Merger will also
have a significant dilutive effect on the aggregate voting power of the existing
PIA stockholders. Upon the consummation of the Merger, existing PIA stockholders
will hold approximately 30% of the PIA common stock then outstanding and the

3

SAI Stockholders and holders of Substitute Options (assuming full exercise
thereof) will hold an aggregate of approximately 70% of the PIA common stock
then outstanding.

In connection with the Merger, one share of PIA common stock will be issued
in exchange for each share of SAI common stock outstanding immediately prior to
the consummation of the Merger. In addition, PIA will assume all of SAI's
outstanding options to purchase SAI common stock (the "SAI Options") and will
issue Substitute Options to purchase an aggregate of 134,114 shares of PIA
common stock. Each Substitute Option will have an exercise price of $0.01 per
share.

Although the exact number of shares to be issued to the SAI Stockholders in
connection with the Merger will not be determined until immediately prior to the
closing of the Merger, the number of shares will equal (a) 2 1/3 times the total
number of outstanding shares of PIA common stock on the business day prior to
the closing of the Merger, minus (b) 134,114 (the number of Substitute Options).
Immediately following the Merger and assuming full exercise of all Substitute
Options and without regard to vesting (i) the SAI Stockholders and the holders
of Substitute Options will hold an aggregate of approximately 70% of the PIA
common stock then outstanding and (ii) the holders of PIA common stock
immediately prior to the Merger will hold an aggregate of approximately 30% of
the PIA common stock then outstanding. The total number of shares of PIA common
stock to be issued to the SAI Stockholders and to be covered by the Substitute
Options issued to SAI Option holders pursuant to the Merger is estimated to be
approximately 12.8 million.

While dollar fluctuations in the market price of PIA common stock will not
affect the number of shares of PIA common stock and Substitute Options to be
issued in the Merger, they would change the aggregate value of the shares of PIA
common stock and Substitute Options issued in the Merger. Based on the number of
shares of PIA common stock outstanding on June 7, 1999 (5,480,966 outstanding
shares), upon the consummation of the Merger, PIA will issue an aggregate of
approximately 12,654,806 shares of PIA common stock to the SAI Stockholders and
Substitute Options covering an aggregate of 134,114 shares of PIA common stock
to the holders of SAI Options. Such shares of PIA common stock would have a
value of approximately $45.1 million and the Substitute Options (assuming full
exercise thereof and without regard to vesting) would have a value of
approximately $480,000, based upon the closing price of PIA common stock as
reported on the Nasdaq National Market on June 7, 1999.

If the requisite approval of the stockholders of PIA is received and all
other conditions to closing are satisfied or waived, the Merger is anticipated
to close in July 1999. Either PIA or SPAR may, to the extent permitted by law,
waive any condition to closing.

YOUR BOARD OF DIRECTORS HAS CAREFULLY REVIEWED AND CONSIDERED THE TERMS AND
CONDITIONS OF THE MERGER, THE SHARE/OPTION ISSUANCE, EACH OF THE PRE-MERGER
CHARTER AMENDMENTS, THE REVERSE SPLIT PROPOSAL AND THE OPTION PLAN AMENDMENT AND
HAS DETERMINED THAT THE MERGER, THE SHARE/OPTION ISSUANCE, EACH OF THE
PRE-MERGER CHARTER AMENDMENTS, THE REVERSE SPLIT PROPOSAL AND THE OPTION PLAN
AMENDMENT ARE FAIR TO, AND IN THE BEST INTERESTS OF, PIA AND THE PIA
STOCKHOLDERS. YOUR BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE MERGER, THE
SHARE/OPTION ISSUANCE, EACH OF THE PRE-MERGER CHARTER AMENDMENTS AND THE OPTION
PLAN AMENDMENT. IN ADDITION, YOUR BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED
THAT THE REVERSE SPLIT PROPOSAL BE INCLUDED IN THE PROXY STATEMENT FOR YOUR
CONSIDERATION AND APPROVAL. ACCORDINGLY, YOUR BOARD OF DIRECTORS UNANIMOUSLY
RECOMMENDS THAT YOU VOTE FOR THE SHARE/OPTION ISSUANCE, EACH OF THE PRE-MERGER
CHARTER AMENDMENTS, THE REVERSE SPLIT PROPOSAL AND THE OPTION PLAN AMENDMENT.
YOUR BOARD OF DIRECTORS ALSO RECOMMENDS THAT STOCKHOLDERS VOTE FOR ELECTION OF
THE SEVEN NOMINEES TO SERVE AS DIRECTORS OF PIA UNTIL SUCH TIME AS THE MERGER
MAY BE CONSUMMATED, OR IF THE MERGER IS NOT CONSUMMATED, UNTIL SUCH TIME AS
THEIR SUCCESSORS ARE DULY ELECTED AND QUALIFIED.

Your vote is important regardless of how many shares you own. Please take a
few minutes now to review the Proxy Statement and to sign and date your proxy
and return it in the envelope provided. You may attend the meeting and vote in
person even if you have previously returned your proxy.

Sincerely,
/s/ Terry R. Peets
Chief Executive Officer, President and
Director

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PIA MERCHANDISING SERVICES, INC.
19900 MACARTHUR BOULEVARD, SUITE 900
IRVINE, CALIFORNIA 92612
------------------------

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD ON JULY 8, 1999

TO THE STOCKHOLDERS OF PIA MERCHANDISING SERVICES, INC.:

NOTICE IS HEREBY GIVEN that the 1999 Annual Meeting of Stockholders (the
"Annual Meeting") of PIA Merchandising Services, Inc, a Delaware corporation
("PIA") will be held at 9:00 a.m., Pacific Time, on Thursday, July 8, 1999 at
PIA Merchandising Services, Inc., 19900 MacArthur Boulevard, Suite 900, Irvine,
California 92612, for the following purposes, all as more fully described in the
attached Proxy Statement:

1. To consider and vote upon a proposal to approve the issuance of (i)
shares (the "Merger Shares") of common stock, $.01 par value per share
of PIA (the "PIA Common Stock") to Robert G. Brown and William H.
Bartels (together, the "SAI Principals") and the other stockholders
(collectively with the SAI Principals, the "SAI Stockholders") of SPAR
Acquisition, Inc., a Nevada corporation ("SAI"), and (ii) the issuance
of options ("Substitute Options") to purchase 134,114 shares of PIA
Common Stock to holders (each, an "SAI Option Holder") of SAI options
("SAI Options"), in exchange for their respective SAI shares (the "SAI
Shares") and SAI Options as consideration for the merger of a subsidiary
of PIA with and into SAI.

The Merger Shares and the Substitute Options will be issued as
consideration pursuant to the terms of that certain Agreement and Plan
of Merger dated as of February 28, 1999, as amended (the "Merger
Agreement"), among PIA, PIA Merchandising Co., Inc., a California
corporation and wholly owned subsidiary of PIA ("PIA California"), SG
Acquisition, Inc., a Nevada corporation and wholly owned subsidiary of
PIA ("PIA Acquisition"), SAI, SPAR MCI Performance Group, Inc., a
Delaware corporation ("SMCI"), SPAR Incentive Marketing, Inc., a
Delaware corporation ("SIM"), SPAR Marketing Force, Inc., a Nevada
corporation ("SMF"), SPAR Marketing, Inc., a Delaware corporation
("SMI"), SPAR, Inc., a Nevada corporation ("SINC"), SPAR/Burgoyne Retail
Services, Inc., an Ohio corporation ("SBRS"), SPAR Marketing, Inc., a
Nevada corporation ("SMNEV"), and SPAR Trademarks, Inc., a Nevada
corporation ("STM"), whereby, among other things, PIA Acquisition will
merge with and into SAI (the "Merger"). The issuance of the Merger
Shares and the Substitute Options pursuant to the terms of the Merger
Agreement is referred to as the "Share/Option Issuance."

The Merger will result in a change in control of PIA. The Merger will
also have a significant dilutive effect on the aggregate voting power of
the existing PIA stockholders. Upon the consummation of the Merger,
existing PIA stockholders will hold approximately 30% of the PIA Common
Stock then outstanding and the SAI Stockholders and holders of
Substitute Options (assuming full exercise thereof) will hold an
aggregate of approximately 70% of the PIA Common Stock then outstanding.

As a result of the Merger, each share of common stock, $.01 par value
per share of SAI (the "SAI Common Stock") outstanding immediately prior
to the consummation of the Merger will be converted into the right to
receive one share of PIA Common Stock. The Merger Agreement also
provides for the assumption by PIA of all outstanding options to
purchase SAI Common Stock. Pursuant to the Merger Agreement, PIA will
issue Substitute Options covering an aggregate of 134,114 shares of PIA
Common Stock to the holders of SAI Options. Each Substitute Option shall
provide for the same terms and conditions (including an exercise price
of $0.01 per share) and right to purchase the same number of shares as
the surrendered SAI Option.

Although the exact number of Merger Shares to be issued to the SAI
Stockholders in connection with the Merger will not be determined until
immediately prior to the closing of the Merger, the number of such
shares will equal (a) 2 1/3 times the total number of outstanding shares
of PIA Common Stock on the business day prior to the closing of the
Merger, minus (b) 134,114 (the number of Substitute Options).
Immediately following the Merger (and assuming full exercise of all
Substitute Options

5

and without regard to vesting), (i) the SAI Stockholders and the holders
of Substitute Options will hold an aggregate of approximately 70% of the
PIA Common Stock then outstanding and (ii) the holders of PIA Common
Stock immediately prior to the Merger will hold an aggregate of
approximately 30% of the PIA Common Stock then outstanding. The total
number of shares of PIA Common Stock to be issued to the SAI
Stockholders and to be covered by the Substitute Options issued to the
SAI Option Holders pursuant to the Merger is estimated to be
approximately 12.8 million.

While dollar fluctuations in the market price of PIA Common Stock will
not affect the number of shares of PIA Common Stock and Substitute
Options to be issued in the Merger, such changes in market price would
change the aggregate value of shares of PIA Common Stock and Substitute
Options issued in the Merger. Based on the number of shares of PIA
common stock outstanding on June 7, 1999 (5,480,966 outstanding shares),
upon the consummation of the Merger, PIA will issue an aggregate of
approximately 12,654,806 shares of PIA Common Stock to the SAI
Stockholders and Substitute Options covering 134,114 shares of PIA
Common Stock to the holders of SAI Options. Such Merger Shares would
have a value of approximately $45.1 million and the Substitute Options
(assuming full exercise thereof and without regard to vesting) would
have a value of approximately $480,000, based upon the closing price of
PIA Common Stock as reported on the Nasdaq National Market on June 7,
1999. A copy of the Merger Agreement is attached as Annex A to the Proxy
Statement.

If the requisite approval of the stockholders of PIA is received and all
other conditions to the Merger are satisfied or waived, the Merger is
anticipated to close in July 1999. Either PIA or SPAR may, to the extent
permitted by law, waive any condition to closing.

2. To consider and vote upon a proposal to amend PIA's Certificate of
Incorporation to increase the number of authorized shares of PIA Common
Stock from 15 million to 47 million ("Charter Amendment No. 1"). A copy
of such proposed amendment to PIA's Certificate of Incorporation is
attached as Annex B-1 to the Proxy Statement.

3. To consider and vote upon a proposal to amend PIA's Certificate of
Incorporation to delete the prohibition on stockholder action by written
consent without a meeting under Delaware law ("Charter Amendment No.
2"). A copy of such proposed amendment to PIA's Certificate of
Incorporation is attached as Annex B-2 to the Proxy Statement.

4. To consider and vote upon a proposal to amend PIA's Certificate of
Incorporation to change the name of PIA Merchandising Services, Inc. to
"SPAR Group, Inc." ("Charter Amendment No. 3"). A copy of such proposed
amendment to PIA's Certificate of Incorporation is attached as Annex B-3
to the Proxy Statement. Charter Amendment No. 1, Charter Amendment No. 2
and Charter Amendment No. 3 are collectively referred to as the
"Pre-Merger Charter Amendments."

5. To consider and vote upon a proposal to authorize an amendment, if
deemed necessary by the PIA Board of Directors (the "PIA Board") in its
sole discretion, to PIA's Certificate of Incorporation to effect a
reverse stock split of the issued and outstanding shares of PIA Common
Stock, on the basis of one of the following ratios: one share in
exchange for every two issued and outstanding shares, one share in
exchange for every three issued and outstanding shares or one share in
exchange for every four issued and outstanding shares, with the PIA
Board having the discretion to determine the appropriate ratio to use
immediately prior to effecting the reverse stock split (the "Reverse
Split Proposal"). A copy of such proposed amendment to PIA's Certificate
of Incorporation is attached as Annex B-4 to the Proxy Statement.

6. To consider and vote upon a proposal to amend PIA's Amended and Restated
1995 Stock Option Plan (the "1995 Option Plan"), subject to the
consummation of the Merger, to increase the number of shares of PIA
Common Stock reserved for issuance upon exercise of stock options
granted thereunder from 1.3 million to 3.5 million (the "Option Plan
Amendment"). The Option Plan Amendment will be effected only if the
Merger is consummated. The full text of the 1995 Option Plan, as amended
by the Option Plan Amendment, is attached as Annex C to the Proxy
Statement.

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7. To elect seven directors of PIA to serve on the PIA Board until the
consummation of the Merger or, if the Merger is not consummated, until
such time as their successors are duly elected and qualified. In
connection with the consummation of the Merger, however, if elected,
each of the nominees for director other than Messrs. Patrick W. Collins
and J. Christopher Lewis has agreed to resign from the PIA Board, and
Messrs. Collins and Lewis will appoint the two SAI Principals (Robert G.
Brown and William H. Bartels) and Robert O. Aders to fill three of the
five remaining vacancies on the PIA Board.

8. To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.

Approval of each of the Pre-Merger Charter Amendments and the Reverse Split
Proposal requires the affirmative vote of a majority of the outstanding shares
of PIA Common Stock entitled to vote thereon at the Annual Meeting. Approval of
each of the Share/Option Issuance and the Option Plan Amendment requires the
affirmative vote of a majority of the votes cast with respect to each such
proposal. Approval of the Share/ Option Issuance, each of the three Pre-Merger
Charter Amendments, the Reverse Split Proposal and the Option Plan Amendment
(collectively, the "Merger Proposals") is required for the Merger to be
consummated. Unless all six Merger Proposals are approved, the Merger cannot be
consummated and none of the six proposals will be approved. The director
nominees that receive the greatest number of votes at the Annual Meeting will be
elected to serve on the PIA Board until such time as the Merger may be
consummated, or if the Merger is not consummated, until such time as their
successors are duly elected and qualified.

The PIA Board unanimously recommends that stockholders vote FOR approval
and adoption of the Share/Option Issuance, each of the Pre-Merger Charter
Amendments, the Option Plan Amendment and the Reverse Split Proposal and FOR
election of the seven nominees for director of PIA.

The PIA Board has fixed the close of business on June 7, 1999, as the
record date for the determination of stockholders entitled to notice of, and to
vote at, the Annual Meeting or any adjournment thereof. Only holders of record
of PIA Common Stock at the close of business on June 7, 1999 are entitled to
notice of, and to vote at, the Annual Meeting or any adjournment thereof. The
enclosed Proxy Statement and form of proxy to be used at the Annual Meeting are
being mailed or delivered to the stockholders of PIA on or about June 28, 1999.

YOU ARE URGED TO VOTE UPON THE MATTERS PRESENTED AND TO SIGN, DATE AND
PROMPTLY RETURN THE ENCLOSED PROXY IN THE ENVELOPE PROVIDED. IT IS IMPORTANT FOR
YOU TO BE REPRESENTED AT THE ANNUAL MEETING. PROXIES ARE REVOCABLE AT ANY TIME
AND THE EXECUTION OF YOUR PROXY WILL NOT AFFECT YOUR RIGHT TO VOTE IN PERSON IF
YOU ARE PRESENT AT THE ANNUAL MEETING.

By Order of the Board of Directors
/s/ CATHY L. WOOD

Cathy L. Wood

Secretary

June 28, 1999

Irvine, California
------------------------

REQUESTS FOR ADDITIONAL COPIES OF PROXY MATERIALS SHOULD BE ADDRESSED TO
CATHY L. WOOD, EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER AND SECRETARY,
AT THE OFFICES OF PIA MERCHANDISING SERVICES, INC., 19900 MACARTHUR BOULEVARD,
SUITE 900, IRVINE, CALIFORNIA 92612.

7

PIA MERCHANDISING SERVICES, INC.
19900 MACARTHUR BOULEVARD, SUITE 900
IRVINE, CALIFORNIA 92612
------------------------

PROXY STATEMENT
------------------------

ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD ON JULY 8, 1999

This Proxy Statement and the accompanying form of proxy are furnished in
connection with the solicitation of proxies by the Board of Directors (the "PIA
Board") of PIA Merchandising Services, Inc., a Delaware corporation ("PIA"), for
use in voting at the 1999 Annual Meeting of Stockholders (the "Annual Meeting")
to be held on Thursday, July 8, 1999 at 9:00 a.m., Pacific Time, at PIA
Merchandising Services, Inc., 19900 MacArthur Boulevard, Suite 900, Irvine,
California 92612, and any adjournment thereof. This Proxy Statement and the form
of proxy to be used at the Annual Meeting were mailed or delivered to the
stockholders of PIA on or about June 28, 1999.

At the Annual Meeting, the stockholders of PIA will be asked:

1. To consider and vote upon a proposal to approve the issuance of (i)
shares (the "Merger Shares") of common stock, $.01 par value per share
of PIA (the "PIA Common Stock") to Robert G. Brown and William H.
Bartels (together, the "SAI Principals") and the other stockholders
(collectively with the SAI Principals, the "SAI Stockholders") of SPAR
Acquisition, Inc., a Nevada corporation ("SAI"), and (ii) the issuance
of options ("Substitute Options") to purchase 134,114 shares of PIA
Common Stock to holders (each, an "SAI Option Holder") of SAI options
("SAI Options"), in exchange for their respective SAI shares (the "SAI
Shares") and SAI Options as consideration for the merger of a subsidiary
of PIA with and into SAI.

The Merger Shares and the Substitute Options will be issued as
consideration pursuant to the terms of that certain Agreement and Plan
of Merger dated as of February 28, 1999, as amended (the "Merger
Agreement"), among PIA, PIA Merchandising Co., Inc., a California
corporation and wholly owned subsidiary of PIA ("PIA California"), SG
Acquisition, Inc., a Nevada corporation and wholly owned subsidiary of
PIA ("PIA Acquisition"), SAI, SPAR MCI Performance Group, Inc., a
Delaware corporation ("SMCI"), SPAR Incentive Marketing, Inc., a
Delaware corporation ("SIM"), SPAR Marketing Force, Inc., a Nevada
corporation ("SMF"), SPAR Marketing, Inc., a Delaware corporation
("SMI"), SPAR, Inc., a Nevada corporation ("SINC"), SPAR/Burgoyne Retail
Services, Inc., an Ohio corporation ("SBRS"), SPAR Marketing, Inc., a
Nevada corporation ("SMNEV"), and SPAR Trademarks, Inc., a Nevada
corporation ("STM"), whereby, among other things, PIA Acquisition will
merge with and into SAI (the "Merger"). The issuance of the Merger
Shares and the Substitute Options pursuant to the terms of the Merger
Agreement is referred to as the "Share/Option Issuance."

The Merger will result in a change in control of PIA. The Merger will
also have a significant dilutive effect on the aggregate voting power of
the existing PIA stockholders. Upon the consummation of the Merger,
existing PIA stockholders will hold approximately 30% of the PIA Common
Stock then outstanding and the SAI Stockholders and holders of
Substitute Options (assuming full exercise thereof) will hold an
aggregate of approximately 70% of the PIA Common Stock then outstanding.

As a result of the Merger, each share of common stock, $.01 par value
per share of SAI (the "SAI Common Stock") outstanding immediately prior
to the consummation of the Merger will be converted into the right to
receive one share of PIA Common Stock. The Merger Agreement also
provides for the assumption by PIA of all outstanding options to
purchase SAI Common Stock. Pursuant to the Merger Agreement, PIA will
issue Substitute Options covering an aggregate of 134,114 shares of PIA
Common Stock to the holders of SAI Options. Each Substitute Option shall
provide for the same terms and conditions (including an exercise price
of $0.01 per share) and right to purchase the same number of shares as
the surrendered SAI Option.

8

Although the exact number of Merger Shares to be issued to the SAI
Stockholders in connection with the Merger will not be determined until
immediately prior to the closing of the Merger, the number of such
shares will equal (a) 2 1/3 times the total number of outstanding shares
of PIA Common Stock on the business day prior to the closing of the
Merger, minus (b) 134,114 (the number of Substitute Options).
Immediately following the Merger (and assuming full exercise of all
Substitute Options and without regard to vesting), (i) the SAI
Stockholders and the holders of Substitute Options will hold an
aggregate of approximately 70% of the PIA Common Stock then outstanding
and (ii) the holders of PIA Common Stock immediately prior to the Merger
will hold an aggregate of approximately 30% of the PIA Common Stock then
outstanding. The total number of shares of PIA Common Stock to be issued
to the SAI Stockholders and to be covered by the Substitute Options
issued to the SAI Option Holders pursuant to the Merger is estimated to
be approximately 12.8 million.

While dollar fluctuations in the market price of PIA Common Stock will
not affect the number of shares of PIA Common Stock and Substitute
Options to be issued in the Merger, such changes in market price would
change the aggregate value of shares of PIA Common Stock and Substitute
Options issued in the Merger. Based on the number of shares of PIA
common stock outstanding on June 7, 1999 (5,480,966 outstanding shares),
upon the consummation of the Merger, PIA will issue an aggregate of
approximately 12,654,806 shares of PIA Common Stock to the SAI
Stockholders and Substitute Options covering 134,114 shares of PIA
Common Stock to the holders of SAI Options. Such Merger Shares would
have a value of approximately $45.1 million and the Substitute Options
(assuming full exercise thereof and without regard to vesting) would
have a value of approximately $480,000, based upon the closing price of
PIA Common Stock as reported on the Nasdaq National Market on June 7,
1999. A copy of the Merger Agreement is attached as Annex A to the Proxy
Statement.

If the requisite approval of the stockholders of PIA is received and all
other conditions to the Merger are satisfied or waived, the Merger is
anticipated to close in July 1999. Either PIA or SPAR may, to the extent
permitted by law, waive any condition to closing.

2. To consider and vote upon a proposal to amend PIA's Certificate of
Incorporation to increase the number of authorized shares of PIA Common
Stock from 15 million to 47 million ("Charter Amendment No. 1"). A copy
of such proposed amendment to PIA's Certificate of Incorporation is
attached as Annex B-1 to the Proxy Statement.

3. To consider and vote upon a proposal to amend PIA's Certificate of
Incorporation to delete the prohibition on stockholder action by written
consent without a meeting under Delaware law ("Charter Amendment No.
2"). A copy of such proposed amendment to PIA's Certificate of
Incorporation is attached as Annex B-2 to the Proxy Statement.

4. To consider and vote upon a proposal to amend PIA's Certificate of
Incorporation to change the name of PIA Merchandising Services, Inc. to
"SPAR Group, Inc." ("Charter Amendment No. 3"). A copy of such proposed
amendment to PIA's Certificate of Incorporation is attached as Annex B-3
to the Proxy Statement. Charter Amendment No. 1, Charter Amendment No. 2
and Charter Amendment No. 3 are collectively referred to as the
"Pre-Merger Charter Amendments."

5. To consider and vote upon a proposal to authorize an amendment, if
deemed necessary in the sole discretion of the PIA Board of Directors
(the "PIA Board"), to PIA's Certificate of Incorporation to effect a
reverse stock split of the issued and outstanding shares of PIA Common
Stock, on the basis of one of the following ratios: one share in
exchange for every two issued and outstanding shares, one share in
exchange for every three issued and outstanding shares or one share in
exchange for every four issued and outstanding shares, with the PIA
Board having the discretion to determine the appropriate ratio to use
immediately prior to effecting the reverse stock split (the "Reverse
Split Proposal"). A copy of such proposed amendment to PIA's Certificate
of Incorporation is attached as Annex B-4 to the Proxy Statement.

6. To consider and vote upon a proposal to amend PIA's Amended and Restated
1995 Stock Option Plan (the "1995 Option Plan"), subject to the
consummation of the Merger, to increase the number of shares of PIA
Common Stock reserved for issuance upon exercise of stock options
granted thereunder from 1.3 million to 3.5 million (the "Option Plan
Amendment"). The Option Plan

9

Amendment will be effected only if the Merger is consummated. The full
text of the 1995 Option Plan, as amended by the Option Plan Amendment, is
attached as Annex C to the Proxy Statement.

7. To elect seven directors of PIA to serve on the PIA Board until the
consummation of the Merger or, if the Merger is not consummated, until
such time as their successors are duly elected and qualified. In
connection with the consummation of the Merger, however, if elected,
each of the nominees for director other than Messrs. Patrick W. Collins
and J. Christopher Lewis has agreed to resign from the PIA Board, and
Messrs. Collins and Lewis will appoint the two SAI Principals (Robert G.
Brown and William H. Bartels) and Robert O. Aders to fill three of the
five remaining vacancies on the PIA Board.

8. To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.

Approval of each of the Pre-Merger Charter Amendments and the Reverse Split
Proposal requires the affirmative vote of a majority of the outstanding shares
of PIA Common Stock entitled to vote thereon at the Annual Meeting. Approval of
each of the Share/Option Issuance and the Option Plan Amendment requires the
affirmative vote of a majority of the votes cast with respect to each such
proposal. Approval of the Share/ Option Issuance, each of the three Pre-Merger
Charter Amendments, the Reverse Split Proposal and the Option Plan Amendment
(collectively, the "Merger Proposals") is required for the Merger to be
consummated. Unless all six Merger Proposals are approved, the Merger cannot be
consummated and none of the six proposals will be approved. The director
nominees that receive the greatest number of votes at the Annual Meeting will be
elected to serve on the PIA Board until such time as the Merger may be
consummated, or if the Merger is not consummated, until such time as their
successors are duly elected and qualified.

The PIA Board has obtained an opinion from its financial advisor, ING
Baring Furman Selz LLC ("ING Barings"), that, taking into account the number of
SAI Shares and SAI Options to be outstanding immediately prior to the Merger and
the number of Merger Shares and Substitute Options to be received, the Initial
Exchange Ratio (as defined below) in connection with the Merger is fair, from a
financial point of view, to the holders of PIA Common Stock. The exchange ratio
referred to by ING Barings in its opinion was based upon PIA issuing an
aggregate of approximately 12.3 million shares of PIA Common Stock to the SAI
Stockholders and the holders of Substitute Options (assuming full exercise
thereof) which represented approximately 69.3% (the "Initial SPAR Percentage")
of the outstanding shares of PIA Common Stock or approximately 2.25 times (the
"Initial SPAR Multiplier") the number of shares of PIA Common Stock outstanding
on February 28, 1999. References in this Proxy Statement to the "Initial
Exchange Ratio" are to the one-to-one exchange ratio referred to by ING Barings
in its opinion, a copy of which is attached hereto as Annex D and should be read
in its entirety, and based upon the Initial SPAR Percentage and Initial SPAR
Multiplier. The Merger Agreement was subsequently amended to increase the
consolidated net worth of SPAR required under the agreement from $500,000 to
$1,436,000 (in each case, after giving effect to the exclusion of certain
charges and other costs as set forth in the Merger Agreement) and an increase in
the percentage of shares of PIA Common Stock to be issued to the SAI
Stockholders and the holders of Substitute Options (assuming full exercise
thereof) in the Merger was made from 69.3% to 70% (the "Final SPAR Percentage")
or 2 1/3 times (the "Final SPAR Multiplier") the number of shares of PIA Common
Stock outstanding which represents an aggregate of approximately 12.8 million
shares of PIA Common Stock (based on the number of shares of PIA Common Stock
outstanding as of June 7, 1999). References in this Proxy Statement to the
"Amended Exchange Ratio" are to the one-to-one exchange ratio contained in the
Merger Agreement as amended and based on the Final SPAR Percentage and Final
SPAR Multiplier. While the Initial Exchange Ratio referred to in the ING Barings
opinion and the Amended Exchange Ratio are each one-to-one, the number of shares
of PIA Common Stock issuable is greater with the Amended Exchange Ratio than
with the Initial Exchange Ratio, and, accordingly, the Initial SPAR Percentage
is less than the Final SPAR Percentage, and the Initial SPAR Multiplier is less
than the Final SPAR Multiplier. Therefore, the Initial Exchange Ratio and the
Amended Exchange Ratio are not equivalent. The PIA Board determined that the
amendment to the Merger Agreement would not materially affect the fairness of
the Merger to PIA and its stockholders from a financial point of view and
determined that an updated fairness opinion was not necessary. ING Barings
rendered an opinion as of its date on the Initial Exchange Ratio, based on the
Initial SPAR Percentage and the Initial SPAR Multiplier, but did not render an
opinion on the Amended Exchange Ratio. ING Barings disclaims any inference or
implication that may be drawn or suggest that the Amended

10

Exchange Ratio is equivalent to the Initial Exchange Ratio or that the Amended
Exchange Ratio is fair from a financial point of view or otherwise to PIA or its
stockholders. There can be no assurance that PIA would be able to obtain a
fairness opinion with respect to the Amended Exchange Ratio, the Final SPAR
Percentage and/or the Final SPAR Multiplier.

The PIA Board unanimously recommends that the stockholders of PIA vote
"FOR" the Share/Option Issuance, each of the Pre-Merger Charter Amendments, the
Reverse Split Proposal and the Option Plan Amendment and FOR election of the
seven nominees to serve as directors of PIA. In connection with the Merger,
Clinton E. Owens, a PIA director, and RVM/PIA, a California limited partnership,
who own approximately 40.7% of the outstanding voting securities of PIA as of
the Record Date (as defined below), in the aggregate, have executed a voting
agreement to vote all PIA Common Stock over which they have voting control in
favor of the Share/Option Issuance, each of the Pre-Merger Charter Amendments,
the Reverse Split Proposal and the Option Plan Amendment.

Holders of PIA's voting securities will not be entitled to any dissenters'
or appraisal rights in connection with the Merger.

All proxies that are properly completed, signed and returned prior to the
Annual Meeting will be voted. Any proxy given by a stockholder may be revoked at
any time before it is exercised, by filing with the Secretary of PIA an
instrument revoking it, by delivering a duly executed proxy bearing a later date
or by the stockholder attending the Annual Meeting and voting his or her shares
in person.

PIA's executive offices are located at PIA Merchandising Services, Inc.,
19900 MacArthur Boulevard, Suite 900, Irvine, California 92612.

The PIA Board has fixed the close of business on June 7, 1999 as the record
date (the "Record Date") for the determination of stockholders entitled to vote
at the Annual Meeting and any adjournment thereof. As of the Record Date, there
were 5,480,966 shares of PIA Common Stock issued and outstanding.

11

TABLE OF CONTENTS

PAGE
----

FORWARD-LOOKING STATEMENTS..................................    1
SUMMARY.....................................................    1
RISK FACTORS................................................   15
THE ANNUAL MEETING..........................................   25
PROPOSAL I: SHARE/OPTION ISSUANCE...........................   27
BUSINESS OF PIA.............................................   53
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF PIA..........................   61
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK......................................................   70
MARKET AND DIVIDEND INFORMATION FOR PIA.....................   72
BUSINESS OF SPAR............................................   73
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF SPAR.........................   80
MARKET AND DIVIDEND INFORMATION FOR SPAR....................   87
UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION..........   87
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL
STATEMENTS................................................   92
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS OF PIA PRIOR
TO THE MERGER.............................................   97
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS OF THE
COMBINED COMPANY FOLLOWING THE MERGER.....................   99
PROPOSAL II: CHARTER AMENDMENT NO. 1........................  100
PROPOSAL III: CHARTER AMENDMENT NO. 2.......................  101
PROPOSAL IV: CHARTER AMENDMENT NO. 3........................  102
PROPOSAL V: REVERSE SPLIT PROPOSAL..........................  102
PROPOSAL VI: OPTION PLAN AMENDMENT..........................  106
PROPOSAL VII: ELECTION OF DIRECTORS.........................  110
EXECUTIVE OFFICERS' COMPENSATION AND OTHER INFORMATION OF
PIA.......................................................  113
COMPANY PERFORMANCE.........................................  121
DESCRIPTION OF PIA'S CAPITAL STOCK..........................  122
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE.....  123
INDEPENDENT ACCOUNTANTS.....................................  123
SUBMISSION OF STOCKHOLDER PROPOSALS.........................  124
AVAILABLE INFORMATION.......................................  124
PIA'S ANNUAL REPORT.........................................  124
OTHER MATTERS...............................................  124
PROXIES AND SOLICITATION....................................  124
INDEX TO FINANCIAL STATEMENTS...............................  F-1

Annex A  -- Agreement and Plan of Merger

Annex B-1 -- Form of Amendment to Certificate of Incorporation of PIA
Merchandising Services, Inc. for Charter Amendment No. 1

Annex B-2 -- Form of Amendment to Certificate of Incorporation of PIA
Merchandising Services, Inc. for Charter Amendment No. 2

Annex B-3 -- Form of Amendment to Certificate of Incorporation of PIA
Merchandising Services, Inc. for Charter Amendment No. 3

Annex B-4 -- Form of Amendment to Certificate of Incorporation of PIA
Merchandising Services, Inc. for Reverse Split Proposal

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Annex C  -- PIA Merchandising Services, Inc. Amended and Restated 1995 Stock
Option Plan

Annex D  -- Opinion of ING Baring Furman Selz LLC

Annex E  -- Glossary

Annex F  -- Form of Proxy

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13

PIA AND ALL ITS WHOLLY OWNED SUBSIDIARIES
PRE-MERGER ORGANIZATIONAL CHART*

[CHART]

SPAR COMPANIES*
PRE-MERGER ORGANIZATIONAL CHART
(AFTER THE SPAR REORGANIZATION TRANSACTIONS)

[CHART]
---------------

* All interests are held beneficially and of record as indicated. In addition,
all interests are held solely in Common Stock.

iii

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SPAR GROUP, INC.
POST-MERGER ORGANIZATIONAL CHART*

[CHART]
-----------------

* All interests are held beneficially and of record as indicated. In addition,
all interests are held solely in Common Stock.

iv

15

FORWARD-LOOKING STATEMENTS

Certain statements contained in this Proxy Statement constitute
"forward-looking statements." The reasons for the Merger discussed under the
caption "Proposal I: Share/Option Issuance," statements about the expected
impact of the Merger on the businesses, financial performance and condition,
accounting and tax treatment of the PIA Companies, the SPAR Companies and the
Combined Company (each as defined below), the extent of the charges to be
incurred by PIA related to the Merger and the strategy of the Combined Company
after the Merger are forward-looking statements. Further, any statements
contained herein that are not statements of historical fact may be deemed to be
forward-looking statements. Without limiting the foregoing, the words
"projects," "believes," "anticipates," "plans," "expects," "may," "might,"
"will," "continue," "intends" or the negative thereof or other variations
thereon or comparable and similar expressions are intended to identify
forward-looking statements. There are a number of important factors that could
cause the results of the PIA Companies and the SPAR Companies following the
effective time of the Merger (collectively, the "Combined Company") to differ
materially from those indicated by such forward-looking statements, including,
but not limited to: (i) factors related to the Merger, including the risks that
anticipated synergies will not be realized, the significant transaction charges
and the substantial dilutive effect to holders of PIA Common Stock that will
result from the Merger, and of the effect of the Merger on customers and
partners of the PIA Companies and the SPAR Companies, and (ii) factors related
to the respective businesses of the PIA Companies and the SPAR Companies,
including history of operating losses and uncertain profitability, significant
fluctuations in operating results, uncertainty of commission income,
concentrated client base, loss of business, potential employment tax liability,
the ability to recruit, train and retain qualified sales and other personnel, as
well as those additional factors set forth in this Proxy Statement under the
caption "Risk Factors." Readers are cautioned not to place undue reliance on the
forward-looking statements contained in this Proxy Statement. Unless otherwise
required by applicable securities laws, the PIA Companies and the SPAR Companies
have no obligation to publicly release the results of any revisions to these
forward-looking statements to reflect events or circumstances after the date of
this filing.

SUMMARY

The following is a summary of certain information contained elsewhere in
this Proxy Statement and the Annexes hereto. This summary does not contain a
complete statement of all material features of the proposals to be voted on and
is qualified in its entirety by reference to the full text of this Proxy
Statement and the Annexes. Stockholders are urged to read this Proxy Statement
and the Annexes in their entirety. See the glossary at Annex E for a description
of certain terms that are used throughout this Proxy Statement.

THE PARTIES TO THE MERGER

PIA

The PIA Companies (as defined in the next paragraph) are suppliers of
in-store merchandising and sales services in the United States and Canada. The
PIA Companies provide these services primarily on behalf of consumer product
manufacturers and retailers at approximately 17,000 retail grocery stores, 6,000
mass merchandisers and 8,800 drug stores. The PIA Companies currently provide
three principal types of services: shared services, where an associate
represents multiple clients; dedicated services, where associates work for one
specific client; and project services, where associates perform special in-store
activities.

PIA, organized in 1943, initially provided merchandising services in retail
grocery chains on behalf of manufacturers. In mid-1988, PIA's management
determined that a national merchandising company could capitalize on
developments within the retail grocery industry by providing merchandising
services to a variety of manufacturers in the industry. Until 1989, PIA operated
exclusively in retail grocery chains in California and Arizona. In 1990, PIA
implemented a national expansion strategy to cover the grocery trade. In 1993,
PIA expanded its focus to address additional retail channels, including mass
merchandiser, chain drug and discount drug stores. In 1994, PIA began offering
dedicated services to retailers and manufacturers. In 1997, PIA established a
corporate and division infrastructure for its project services business. The PIA
Companies currently perform their services primarily on behalf of approximately
805 consumer product manufacturers. PIA, PIA California and PIA Acquisition are
sometimes collectively referred to as the "PIA Parties" and

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individually, as a "PIA Party." PIA, PIA California and all of PIA California's
subsidiaries are sometimes collectively referred to as the "PIA Companies" and
individually as a "PIA Company."

The PIA Companies' principal executive offices are located at 19900
MacArthur Boulevard, Suite 900, Irvine, California 92612, and its telephone
number is (949) 476-2200.

PIA ACQUISITION

PIA Acquisition was incorporated in the State of Nevada in February 1999,
solely for the purpose of consummating the Merger. PIA Acquisition has limited
assets and has no business and has not carried on any activities other than
those which are directly related to its formation and its execution of the
Merger Agreement. Its principal executive offices are located at 19900 MacArthur
Boulevard, Suite 900, Irvine, California 92612 and its telephone number is (949)
476-2200.

SPAR

SAI was organized as a holding company in December 1998. The SAI
Stockholders own all of the issued and outstanding capital stock of SAI. The SAI
Principals also own all of the issued and outstanding capital stock of each of
SMI, SMF, SINC, SBRS, SIM, SMCI, SMNEV, and STM. SMF, SINC, SBRS and SMNEV may
be referred to individually as a "SPAR Marketing Company" and collectively as
the "SPAR Marketing Companies." SAI, SIM, SMCI, SMI, the SPAR Marketing
Companies and STM may be referred to individually as a "SPAR Company" and
collectively as the "SPAR Companies" or "SPAR." The SAI Principals have agreed
to effect certain reorganization transactions (the "SPAR Reorganization
Transactions") immediately prior to the closing of the Merger. After the
completion of the SPAR Reorganization Transactions, SAI will be the parent
holding company and the sole stockholder of each of SMI, SIM and STM, SIM will
be the sole stockholder of SMCI, and SMI will be the sole stockholder of each of
the SPAR Marketing Companies.

Since the founding of SINC in 1979, the SPAR Marketing Companies have grown
to provide nationwide retail merchandising and marketing services to home video,
consumer goods and food products companies. The SPAR Marketing Companies
currently operate in all 50 states and provide a broad range of in-store
merchandising and other marketing services to many of the nation's leading
companies, including Warner Bros. and General Motors Corporation. The SPAR
Marketing Companies provide their services through approximately 3,062 part-time
employees, which are supported by approximately 169 full-time office employees,
and approximately 2,300 independent contractors pursuant to the SPAR Marketing
Companies' agreement (the "Field Service Agreement") with SPAR Marketing
Services, Inc. ("SMS"), a related company not being acquired by PIA or SPAR. See
"Business of SPAR -- Certain Relationships and Related Party Transactions" and
"Risk Factors -- The SPAR Marketing Companies May Be Held Liable for the Tax
Liability of SMS."

The services provided by the SPAR Marketing Companies include retail
merchandising (increasing the visibility, availability and sales of products
on-site), test market research (testing promotion alternatives, new products and
advertising campaigns, as well as packaging, pricing, and location changes, at
store level), mystery shopping (calling anonymously on retail outlets to check
on distribution or display of a brand and to evaluate products, services,
clients or employees), database marketing (managing proprietary information to
permit easy access, analysis and manipulation), data collection (systematically
gathering information for analysis and interpretation), and teleservices
(inbound and outbound calling to strengthen customer relationships, solicit new
programs and collect consumer business services or retail or product
information).

In January 1999, SMCI acquired substantially all the assets and liabilities
of MCI Performance Group, Inc., a Texas corporation ("MCI"), the
predecessor-in-interest of which was founded in 1987. This acquisition is
referred to as the "MCI Acquisition." SMCI had no operations prior to the MCI
Acquisition. SMCI specializes in designing and implementing premium incentives
and managing group travel and meetings for clients throughout the United States.
SMCI provides a wide variety of consulting, creative, program administration and
travel and merchandise fulfillment services to companies seeking to motivate
employees, salespeople, dealers, distributors, retailers and consumers toward
certain actions or objectives. SMCI employs approximately 100 persons.

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17

SPAR's principal executive offices are located at 303 South Broadway, Suite
140, Tarrytown, New York 10591. The telephone number of its principal executive
offices is (914) 332-4100.

OPERATIONS AFTER THE MERGER

OVERVIEW OF THE SPAR REORGANIZATION, MERGER AND POST-MERGER DIVISIONS

SPAR currently provides merchandising and marketing services to leading
entertainment, consumer goods, food products and retail companies through SPAR's
two existing operating divisions (the "Existing SPAR Divisions"): (i)
merchandising and marketing services through SMI and the SPAR Marketing
Companies (the "SPAR Merchandising Division"); and (ii) premium incentives
through SIM and SMCI (the "SPAR Incentive Division"). Immediately prior to the
effective time of the Merger (the "Effective Time"), SAI will acquire all of the
stock of the SPAR Merchandising Division, the SPAR Incentive Division and STM
from the SAI Principals pursuant to the Reorganization Agreement dated as of
February 28, 1999, among SAI, the SPAR Companies and the SAI Principals (the
"Reorganization Agreement"). SAI's acquisition of such stock and the other
transactions under the Reorganization Agreement are referred to as the SPAR
Reorganization Transactions. After the completion of the SPAR Reorganization
Transactions, SAI will be the parent holding company and the sole stockholder of
each of the other SPAR Companies in the SPAR Merchandising Division and the SPAR
Incentive Division and of STM.

At the Effective Time, PIA Acquisition will merge into and with SAI, and
SAI will be the surviving corporation and a wholly owned subsidiary of PIA.
Following the Merger, the Combined Company intends to conduct its businesses
through three divisions: (i) the SPAR Merchandising Division; (ii) the SPAR
Incentive Division; and (iii) PIA California and its subsidiaries (the "PIA
Division," and together with the Existing SPAR Divisions, the "Divisions").

OPERATING STRATEGY POST-MERGER

PIA and SPAR intend to (i) leverage their current client relationships by
cross-selling the range of services offered by the Divisions after the Merger,
(ii) achieve operating efficiencies within the Divisions through utilization of
their existing field force and technology infrastructure to support additional
customers and revenue, and by combining certain administrative functions, and
(iii) utilize computer, Internet and other technology to enhance their
efficiency and ability to provide real-time data to their customers and to
respond to customers' needs and implement programs more rapidly. PIA and SPAR
intend that management of each Division will conduct their day-to-day
operations, sales representation and potential customer identification on a
decentralized basis, while a company-wide team of senior management will provide
the Divisions with strategic oversight and guidance with respect to
acquisitions, financing, marketing, operations and cross-selling opportunities.
The operational autonomy of the Divisions will be complemented by equity and
other incentive compensation through which the Combined Company intends to
motivate division managers to focus on company-wide performance.

ACQUISITION STRATEGY

PIA and SPAR intend to acquire businesses across the United States and
Canada that offer marketing services in which each of the Divisions operates and
to consolidate the sectors of the marketing services they serve. PIA and SPAR
also believe that there are numerous other attractive sectors within the
marketing services industry, such as ad specialty, direct marketing, database
marketing, sales promotions, information/research, sampling and consumer
demonstrations. As part of its acquisition strategy, SPAR is actively exploring
and considering a number of potential acquisition candidates in both the
business of the Existing SPAR Divisions and in other sectors of the marketing
services industry. However, neither PIA nor SPAR has entered into any definitive
agreement with respect to any contemplated or desired acquisition.

THE ANNUAL MEETING

PURPOSE

At the Annual Meeting, PIA stockholders will be asked to: (i) approve the
Share/Option Issuance; (ii) approve each of the Pre-Merger Charter Amendments;
(iii) approve the Reverse Split Proposal;

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18

(iv) approve the Option Plan Amendment; (v) elect seven directors to the PIA
Board; and (vi) transact any other business that may properly come before the
meeting or any adjournments or postponements thereof.

TIME, PLACE AND DATE

The Annual Meeting will be held at PIA Merchandising Services, Inc. located
at 19900 MacArthur Boulevard, Suite 900, Irvine, California 92612 on Thursday,
July 8, 1999 at 9:00 a.m. Pacific Time.

RECORD DATE; QUORUM; VOTES REQUIRED

Holders of shares of PIA Common Stock as of the close of business on June
7, 1999, which has been set as the "Record Date," will be entitled to vote at
the Annual Meeting. The presence in person or by proxy of a majority of the
outstanding shares of PIA Common Stock at the Annual Meeting constitutes a
quorum, thus enabling the stockholders to transact business at the Annual
Meeting. In connection with the Merger, Clinton E. Owens, a PIA director, and
RVM/PIA, a California limited partnership, who own approximately 40.7% of the
outstanding voting securities of PIA in the aggregate as of the Record Date,
have executed a voting agreement to vote all PIA Common Stock over which they
have voting control in favor of the Share/Option Issuance, each of the
Pre-Merger Charter Amendments, the Reverse Split Proposal and the Option Plan
Amendment.

Approval of each of the Pre-Merger Charter Amendments and the Reverse Split
Proposal requires the affirmative vote of a majority of the outstanding shares
of PIA Common Stock entitled to vote thereon at the Annual Meeting. Approval of
each of the Share/Option Issuance and the Option Plan Amendment requires the
affirmative vote of a majority of the votes cast with respect to each such
proposal. Approval of each of the Merger Proposals is required for the Merger to
be consummated. Unless all six Merger Proposals are approved, the Merger cannot
be consummated and none of the six proposals will be approved. The director
nominees that receive the greatest number of votes at the Annual Meeting will be
elected to serve on the PIA Board until such time as the Merger may be
consummated, or if the Merger is not consummated, until such time as their
successors are duly elected and qualified.

THE MERGER

STRUCTURE

Pursuant to the Merger Agreement, PIA Acquisition, a wholly owned
subsidiary of PIA will be merged with and into SAI. Following the Merger, SAI
shall continue as the surviving corporation (sometimes also referred to herein
as the "Surviving Corporation") and will be a wholly owned subsidiary of PIA,
and PIA Acquisition shall cease to exist. If the PIA stockholders approve each
of the Merger Proposals, it is contemplated that the Merger will become
effective no later than two business days after certain regulatory approvals are
obtained and the other conditions to the closing (the "Closing") of the
transactions contemplated by the Merger are satisfied or, to the extent
permitted by law, waived by either PIA or SPAR. On June 21, 1999, PIA received
confirmation of the early termination of all applicable waiting periods under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR
Act") with respect to the Merger. The Merger will become effective on the date
and time of filing of the Articles of Merger with the Nevada Secretary of State
or at such later time as may be specified for effectiveness in the Articles of
Merger. The date on which the Closing occurs is referred to as the "Closing
Date."

MERGER CONSIDERATION

Each share of SAI Common Stock outstanding immediately prior to the
Effective Time will be converted into the right to receive one share of PIA
Common Stock, provided that any holder of SAI Common Stock entitled to receive a
fractional share of PIA Common Stock will receive cash in lieu of such
fractional share. PIA will also assume all outstanding options to purchase SAI
Common Stock and issue Substitute Options covering an aggregate of 134,114
shares of PIA Common Stock to the holders of SAI Options. Each Substitute Option
shall provide for the same terms and conditions (including an exercise price of
$0.01 per share) and right to purchase the same number of shares as the
surrendered SAI Options. The shares of PIA Common Stock and the Substitute
Options to be issued in connection with the Merger are referred to collectively
as the "Merger Consideration." Based on the number of shares of PIA Common Stock

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19

outstanding on June 7, 1999 (5,480,966 outstanding shares), upon the
consummation of the Merger, PIA will issue an aggregate of approximately
12,654,806 shares of PIA common stock to the SAI Stockholders and Substitute
Options covering an aggregate of 134,114 shares of PIA Common Stock to the
holders of SAI Options. Such shares of PIA Common Stock would have a value of
approximately $45.1 million and the Substitute Options (assuming full exercise
thereof and without regard to vesting) would have a value of approximately
$480,000, based upon the closing price of PIA Common Stock as reported on the
Nasdaq National Market on June 7, 1999.

MANAGEMENT AFTER THE MERGER

The Merger Agreement provides that the members of the PIA Board will have
taken all necessary action to cause the PIA Board, from and after the Effective
Time until such time as their successors are duly elected and qualified, to be
comprised of seven members and to cause the following persons to be elected as
directors of the PIA Board: Messrs. Robert O. Aders, William H. Bartels, Robert
G. Brown, Patrick W. Collins, and J. Christopher Lewis. Accordingly, at the
Effective Time, the existing directors of PIA other than Messrs. Collins and
Lewis have agreed to resign, and Messrs. Collins and Lewis will appoint Messrs.
Aders, Brown and Bartels to fill three of the five remaining vacancies on the
PIA Board.

Pursuant to the Merger Agreement, the PIA Board will take all necessary
action to cause the following persons to be appointed to the offices indicated
as of the Effective Time (current positions with PIA and SPAR are also shown):

POSITION WITH THE COMBINED
NAME               COMPANY AFTER THE MERGER    CURRENT POSITION WITH PIA OR SPAR
----              ---------------------------  ---------------------------------

Robert G. Brown............  Chairman, Chief Executive    Chairman, Chief Executive
Officer, President (other    Officer, President (other than
than SMCI) and Director      SMCI) and Director of each of
the SPAR Companies
William H. Bartels.........  Vice Chairman and Director   Vice Chairman, Senior Vice
President, Treasurer, Secretary
and Director of each of the
SPAR Companies
Patrick W. Collins.........  Director                     Director of PIA
Robert O. Aders............  Director                     None
J. Christopher Lewis.......  Director                     Director of PIA
Terry R. Peets.............  Vice Chairman                Chief Executive Officer,
President and Director of PIA
James H. Ross..............  Treasurer                    Chief Financial Officer of each
of the SPAR Companies
Cathy L. Wood..............  Executive Vice President,    Executive Vice President, Chief
Chief Financial Officer      Financial Officer and Secretary
and Secretary                of PIA

CONDITIONS TO THE CLOSING OF THE MERGER

The consummation of the Merger is subject to the satisfaction of certain
conditions including among other things the: (i) approval of the Share/Option
Issuance, each of the Pre-Merger Charter Amendments and the Reverse Split
Proposal by the requisite vote of PIA's stockholders; (ii) absence of any legal
restraints or prohibitions preventing the consummation of the Merger; (iii)
authorization for listing of the PIA Common Stock to be issued in the Merger on
the Nasdaq National Market; and (iv) filing of a Certificate of Amendment to
PIA's Certificate of Incorporation to effectuate the Pre-Merger Charter
Amendments. There are a number of other conditions that must be satisfied, or to
the extent permitted by law, waived by either PIA or SPAR before the Merger can
occur. Although the Merger Agreement does not require PIA to resolicit
stockholder votes in the event any condition to the closing of the Merger is
waived, if a party waives a material condition that results in a material change
to the terms of the Merger Agreement, PIA and SPAR will

5

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evaluate whether it is necessary to resolicit proxies to provide an informed
vote. See "Proposal I: Share/ Option Issuance -- Merger Agreement -- Conditions
to the Merger."

INDEMNIFICATION

In connection with the Merger Agreement, each of the SAI Principals,
jointly and severally, has agreed to indemnify the PIA Parties and certain SPAR
Companies against matters arising out of (i) certain tax litigation involving
SMS, and (ii) potential claims arising under a contingent subordinated
promissory note (the "ADVO Note") in the maximum principal amount of $3 million
made by SMF in favor of ADVO Investment Company, Inc., ADVO, Inc., and Stighen,
Inc. The SAI Principals have also agreed to deposit an aggregate of ten percent
of the shares of PIA Common Stock that they and their family members receive in
the Merger in escrow as security for such stockholders' indemnification
obligations. See "Proposal I: Share/ Option Issuance -- Merger Agreement --
Indemnification."

TERMINATION; BREAKUP FEE

In general, the transactions contemplated by the Merger may be terminated
by either PIA or SAI if the Merger is not consummated on or prior to June 30,
1999, and in certain other instances. There can be no assurance that SPAR will
not exercise its right to terminate the Merger Agreement pursuant to the terms
of the Merger Agreement. In addition, the transactions contemplated by the
Merger may be terminated by PIA if PIA accepts an acquisition proposal from a
third party and pays the SPAR Companies a termination fee equal to 3.5% of the
value of the consideration in connection with such acquisition proposal as
determined by the Merger Agreement and the amount of the SPAR Companies' and the
SAI Stockholders' reasonable expenses in connection with the Merger. See
"Proposal I: Share/Option Issuance -- Merger Agreement -- Termination" and "Risk
Factors -- If the Merger with SPAR is Not Consummated PIA May Have to Make
Changes in Operations and Seek Additional Financing."

NO SOLICITATION

Pursuant to the Merger Agreement, the PIA Parties, in general, have agreed
not to solicit, initiate, or encourage any inquiries in the making, submission
or announcement of any alternate acquisition proposal other than in connection
with an unsolicited acquisition proposal. See "Proposal I: Share/Option
Issuance -- Merger Agreement -- No Solicitation."

REASONS FOR THE MERGER

Each of the PIA Board and the SAI Board has identified potential mutual
benefits of the Merger that they believe may contribute to the success of the
Combined Company. These potential benefits may include the following:

(i) As a significantly larger company than either PIA or SPAR alone,
with greater revenue and a broader geographic scope, the Combined Company
may be able to more effectively compete in the highly competitive marketing
services industry with respect to the pricing of its products and services
and its product offerings.

(ii) The complementary businesses of PIA and SPAR may lead to
"operating synergies" and efficiencies, improved technology, and better
customer relationships for the Combined Company that, if achieved, will
allow investors to participate in the anticipated future growth of a
consolidator of the marketing services industry. "Operating synergies"
refer to PIA's belief that when PIA and SPAR are merged, the Combined
Company will produce total results that are greater than the sum of each
company's individual contributions.

(iii) The Combined Company may be a more attractive public investment
than PIA alone and may be more closely followed by securities analysts and
investors.

(iv) The Combined Company's access to capital in the private and
public markets may be enhanced and it could use its public stock as a form
of currency to partially finance potential future acquisitions.

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In light of the above and the other factors described in this Proxy
Statement, the PIA Board believes that the terms of the Merger are fair to, and
in the best interest of, PIA and the PIA stockholders. See "Proposal I:
Share/Option Issuance -- Background of the Merger," "-- PIA's Reasons for the
Merger -- Potential Benefits from the Merger" and "-- SPAR's Reasons for the
Merger."

POTENTIAL NEGATIVE FACTORS ASSOCIATED WITH THE MERGER

The PIA Board has also identified and considered the following potentially
negative factors associated with the Merger:

(a) The risk that some, if not all, of the potential benefits of the
Merger will not be fully realized,

(b) The risks and costs associated with integrating the businesses and
operations of PIA and SPAR,

(c) The possibility that the Merger may not be consummated resulting
in significant accrued transaction costs,

(d) The potentially adverse effects of the announcement of the Merger,
or its failure to be consummated, on PIA's customers and employees, and

(e) Dilution of the voting power of PIA stockholders and the potential
reduction in book value of PIA Common Stock.

For a discussion of the material risks associated with the Merger and the
transactions contemplated thereby and other related information see "Risk
Factors" and "Proposal I: Share/Option Issuance -- Background of the Merger" and
"-- PIA's Reasons for the Merger -- Potential Negative Factors Associated with
the Merger."

RECOMMENDATION OF THE PIA BOARD OF DIRECTORS

The PIA Board unanimously recommends that the stockholders approve the
Share/Option Issuance, each of the Pre-Merger Charter Amendments, the Option
Plan Amendment and the Reverse Split Proposal and vote FOR the election of each
of the nominees named herein as directors of PIA.

FAIRNESS OPINION

ING Barings, the financial advisor retained by the PIA Board in connection
with the Merger, has rendered its opinion that the Initial Exchange Ratio in
connection with the Merger is fair, from a financial point of view, to the
stockholders of PIA. The Initial Exchange Ratio referred to by ING Barings in
its opinion was based upon PIA issuing an aggregate of approximately 12.3
million shares of PIA Common Stock to the SAI Stockholders and the holders of
Substitute Options (assuming full exercise thereof) which represented
approximately 69.3% of the outstanding shares of PIA Common Stock or
approximately 2.25 times the number of shares of PIA Common Stock outstanding on
February 28, 1999. The Merger Agreement was subsequently amended to increase the
consolidated net worth of SPAR required under the agreement from $500,000 to
$1,436,000 (in each case, after giving effect to the exclusion of certain
charges and other costs as set forth in the Merger Agreement) and an increase in
the percentage of shares of PIA Common Stock to be issued to the SAI
Stockholders and the holders of Substitute Options (assuming full exercise
thereof) in the Merger was made from 69.3% to 70% or 2 1/3 times the number of
shares of PIA Common Stock outstanding which represents an aggregate of
approximately 12.8 million shares of PIA Common Stock (based on the number of
shares of PIA Common Stock outstanding as of June 7, 1999). While the Initial
Exchange Ratio referred to in the ING Barings opinion and the Amended Exchange
Ratio are each one-to-one, the number of shares of PIA Common Stock issuable is
greater with the Amended Exchange Ratio than with the Initial Exchange Ratio,
and, accordingly, the Initial SPAR Percentage is less than the Final SPAR
Percentage, and the Initial SPAR Multiplier is less than the Final SPAR
Multiplier. Therefore, the Initial Exchange Ratio and the Amended Exchange Ratio
are not equivalent. ING BARINGS HAS NOT BEEN RETAINED TO RENDER ANY OPINION ON
THE AMENDED EXCHANGE RATIO. ING BARINGS DISCLAIMS ANY INFERENCE OR IMPLICATION
THAT MAY BE DRAWN OR SUGGESTED THAT THE AMENDED EXCHANGE RATIO IS EQUIVALENT TO
THE INITIAL EXCHANGE RATIO OR THAT THE AMENDED EXCHANGE RATIO IS FAIR FROM A
FINANCIAL POINT OF VIEW OR OTHERWISE TO PIA OR ITS STOCKHOLDERS. ING BARINGS HAS
NOT BEEN RETAINED TO REVIEW THE AMENDED EXCHANGE RATIO WITH A VIEW TO RENDER AN
OPINION THEREON.

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For ING Barings' services, PIA has agreed to pay ING Barings a transaction
fee equaling the greater of $800,000 or 1.7% of the first $60 million of
consideration plus 0.8% of any consideration in excess of $60 million, a portion
of which will be paid only upon consummation of the Merger as described in the
next two sentences. Upon ING Barings rendering its opinion, PIA has agreed to
pay $500,000 of such fee (the "$500,000 Amount") which will be credited against
such transaction fee. As of the date of this Proxy Statement, PIA has not paid
the $500,000 Amount. In addition, PIA will be required to pay a minimum of
$200,000 ($300,000 minus a $100,000 retainer fee previously paid by PIA) of such
fee, with the exact amount based on the value of the Merger Consideration as of
the date of the Merger, only if the Merger is consummated. See "Proposal I:
Share/Option Issuance -- Opinion of Financial Advisor."

STOCK OWNERSHIP FOLLOWING THE MERGER

PIA estimates that it will issue approximately 12.7 million shares of PIA
Common Stock to the SAI Stockholders and Substitute Options covering an
aggregate of 134,114 shares of PIA Common Stock in the Merger assuming no
exercise of existing PIA options or warrants. Immediately following the Merger,
and assuming full exercise of all Substitute Options and without regard to
vesting, (i) the SAI Stockholders and the SAI Option Holders will hold an
aggregate of approximately 70% of the PIA Common Stock outstanding, and (ii) the
holders of PIA Common Stock immediately prior to the Merger will hold an
aggregate of approximately 30% of the PIA Common Stock outstanding. PIA does not
anticipate the exercise of any options or warrants prior to the Merger because
the per share exercise price of the majority of existing PIA options exceeds the
closing price of PIA Common Stock as of the business day immediately prior to
the date of this Proxy Statement. In the event any PIA options are exercised
prior to the Merger, the actual number of shares of PIA Common Stock issuable to
the SAI Stockholders will increase, so that the SAI Stockholders and SAI Option
Holders (assuming full exercise of all Substitute Options) will still receive an
aggregate of approximately 70% of the PIA Common Stock outstanding post-Merger.
See "Security Ownership of Certain Beneficial Owners of the Combined Company
Following the Merger."

INTERESTS OF CERTAIN PERSONS IN THE MERGER

In considering the respective recommendations of the PIA Board with respect
to the Merger and the Share/Option Issuance, the PIA stockholders should be
aware that certain members of the PIA Board and certain executive officers of
PIA have interests in the Merger that are in addition to, or different from, the
interests of the PIA stockholders generally. These matters include, among other
matters, provisions in the Merger Agreement relating to (a) indemnification to
the fullest extent permitted by law of the former directors and the seven
nominees for directors of PIA set forth herein and officers holding a title of
Senior Vice President or higher with PIA, PIA California or any of PIA
California's subsidiaries as of February 28, 1999 and (b) arrangements regarding
acceleration of vesting of PIA stock options for the benefit of employees,
officers and directors of PIA, including the current chief executive officer and
the chief financial officer. In addition, all employees and officers of PIA may
receive severance payments if they are terminated following the Merger. See
"Proposal I: Share/Option Issuance -- Interests of Certain Persons in the
Merger."

NO APPRAISAL RIGHTS FOR DISSENTERS

Under Delaware law, holders of PIA Common Stock will not be entitled to
appraisal rights in connection with the Merger or the Share/Option Issuance.

CERTAIN FEDERAL INCOME TAX CONSEQUENCES

The Merger of SAI and PIA Acquisition is intended to be a "tax-free
reorganization," for Federal income tax purposes under Section 368 of the
Internal Revenue Code of 1986, as amended (the "Code"). Neither PIA nor SAI will
recognize any gain or loss in the Merger and neither the PIA stockholders nor
the SAI Stockholders will recognize any gain or loss in the Merger, except to
the extent the SAI Stockholders receive cash in lieu of fractional shares.

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23

ACCOUNTING TREATMENT

The Merger will be treated as a purchase of PIA by SPAR. For accounting
purposes, SPAR is the accounting acquiror since the holders of SAI Common Stock
would hold and have voting power with respect to approximately 70% of the total
issued and outstanding voting capital stock of PIA immediately following the
Merger. Under purchase accounting, the fair value of all the shares of PIA
Common Stock outstanding immediately prior to the Merger will be allocated to
the individual PIA assets and liabilities based on their relative fair values.
The excess of the purchase price over the fair value of the net assets acquired
will be amortized over the estimated period benefitted not to exceed 15 years.
The individual allocations are subject to valuations as of the date of the
Merger based on appraisal and other studies, which are not yet completed.
Accordingly, the final allocations will be different from the amounts reflected
in the unaudited pro forma condensed combined financial information.
Notwithstanding this factor, the unaudited pro forma condensed combined
financial information reflects SPAR's best estimate based on currently available
information as of the date of this Proxy Statement. See "Unaudited Pro Forma
Combined Financial Information."

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SELECTED CONSOLIDATED FINANCIAL DATA OF PIA

The following selected consolidated financial data below, for the periods
and the dates indicated, has been derived from the audited consolidated
financial statements of PIA. The selected consolidated statements of operations
data presented below with respect to the three years ended December 31, 1996,
December 31, 1997 and January 1, 1999, and the consolidated balance sheet data
at December 31, 1997 and January 1, 1999 have been derived from the audited
consolidated financial statements of PIA. The consolidated statements of
operations data for the years ended December 31, 1994, and 1995, and the
consolidated balance sheet data at December 31, 1994, 1995, and 1996, are
derived from the audited consolidated financial statements of PIA not included
herein.

The selected financial data of PIA as of April 2, 1999, and for the three
months ended April 3, 1998 and April 2, 1999, have been derived from the
unaudited financial statements included elsewhere herein. Such selected
financial data are not necessarily indicative of the results to be expected for
the full year. In the opinion of the management the unaudited financial
statements reflect all adjustments, consisting only of normal, recurring accrual
adjustments, necessary for a fair presentation of the financial position and
results of operations for those periods in accordance with generally accepted
accounting principles. The selected financial data presented below are qualified
by reference to the PIA consolidated financial statements and should be read in
conjunction with such financial statements and related notes thereto and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations of PIA" contained elsewhere in this Proxy Statement.

THREE MONTHS
FISCAL YEAR          ENDED
YEAR ENDED DECEMBER 31,               ENDED      -------------------
----------------------------------------   JANUARY 1,    APRIL 3,   APRIL 2,
1994       1995       1996       1997        1999         1998       1999
-------   --------   --------   --------   -----------   --------   --------
(IN THOUSANDS, EXCEPT PER SHARE DATA)

STATEMENT OF OPERATIONS DATA:
Net revenues.......................................  $80,449   $104,791   $119,940   $128,208    $121,788     $34,739    $21,626
Operating expenses:
Field services costs.............................   61,876     81,320     94,841    119,830     105,448      29,789     20,069
Selling expenses.................................    9,028     10,339     11,133     10,482       8,245       2,279      1,555
General and administrative expenses..............    5,800      6,810      8,081     10,234      11,788       3,548      3,110
Restructure and other charges....................       --         --         --      5,420          --          --         --
Depreciation and amortization....................      339        497        595        997       1,129         282        282
-------   --------   --------   --------    --------     -------    -------
Total operating expenses...................   77,043     98,966    114,650    146,963     126,610      35,898     25,016
Operating income (loss)............................    3,406      5,825      5,290    (18,755)     (4,822)     (1,159)    (3,390)
Interest income (expense) net......................     (725)      (465)       823        799         462         128         70
Equity in earnings in affiliate....................       --         --         72         96         149          20         20
-------   --------   --------   --------    --------     -------    -------
Income (loss) before provision (benefit) for income
taxes............................................    2,681      5,360      6,185    (17,860)     (4,211)     (1,011)    (3,300)
Income tax provision (benefit).....................      101      1,829      2,426     (2,761)         55         (12)       (15)
-------   --------   --------   --------    --------     -------    -------
Net income (loss)..................................  $ 2,580   $  3,531   $  3,759   $(15,099)   $ (4,266)    $(1,023)   $(3,315)
=======   ========   ========   ========    ========     =======    =======
Net income (loss) per share -- basic(1)............  $  0.88   $   1.13   $   0.70   $  (2.72)   $  (0.78)    $  (.19)   $  (.61)
=======   ========   ========   ========    ========     =======    =======
Weighted average shares -- basic(1)................    2,923      3,117      5,370      5,551       5,439       5,593      5,478
=======   ========   ========   ========    ========     =======    =======
Net income (loss) per share -- diluted(1)..........  $  0.68   $   0.89   $   0.63   $  (2.72)   $  (0.78)    $  (.19)   $  (.61)
=======   ========   ========   ========    ========     =======    =======
Weighted average shares -- diluted(1)..............    3,895      3,981      5,990      5,551       5,439       5,393      5,478
=======   ========   ========   ========    ========     =======    =======

AS OF
AS OF DECEMBER 31,             --------------------------------
-------------------------------------   JANUARY 1,   APRIL 3,   APRIL 2,
1994      1995      1996      1997        1999        1998       1999
-------   -------   -------   -------   ----------   --------   --------
(IN THOUSANDS)

BALANCE SHEET DATA:
Working capital....................................  $ 3,642   $ 7,131   $32,737   $15,938    $13,844     $14,444    $ 8,797
Total assets.......................................   10,224    16,086    47,672    36,467     26,054      32,331     22,165
Current portion of long-term debt..................      277        --        --        --         --          --         --
Long-term debt, net of current portion.............    3,274     3,400        --        --      2,095          --         90
Total stockholders' equity.........................    2,481     5,988    36,718    18,678     14,724      17,669     11,417

---------------
(1) Net income (loss) per share has been restated for all periods presented in
accordance with the adoption of SFAS No. 128 Earnings Per Share.

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SELECTED FINANCIAL DATA OF SPAR

SELECTED COMBINED FINANCIAL DATA OF THE SPAR COMPANIES

The following selected combined financial data sets forth, for the periods
and the dates indicated, selected combined financial data of the SPAR Companies.
The selected combined statements of operations data presented below for the
years ended March 31, 1996, 1997 and 1998 and the nine month period ended
December 31, 1998, and the combined balance sheet data at March 31, 1997, 1998
and December 31, 1998 have been derived from the SPAR Companies audited combined
financial statements included elsewhere herein. The combined statements of
operations data for the years ended March 31, 1994 and 1995, and the combined
balance sheet data at March 31, 1994, 1995 and 1996, are derived from unaudited
combined financial statements not included herein.

The selected combined financial data of the SPAR Companies as of March 31,
1999, for the nine months ended December 31, 1997 and for the three months ended
March 31, 1998 and 1999, have been derived from the unaudited combined financial
statements included elsewhere herein. Such selected financial data are not
necessarily indicative of the results to be expected for the full year. In the
opinion of the management of the SPAR Companies, the unaudited financial
statements reflect all adjustments, consisting only of normal, recurring accrual
adjustments, necessary for a fair presentation of the financial position and
results of operations for those periods in accordance with generally accepted
accounting principles. The selected financial data presented below are qualified
by reference to the SPAR Companies' combined financial statements and should be
read in conjunction with such financial statements and related notes thereto and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations of SPAR" contained elsewhere in this Proxy Statement.

YEAR                         NINE MONTHS ENDED
ENDED MARCH 31,                     DECEMBER 31,      THREE MONTHS ENDED
-----------------------------------------------   -----------------   ------------------
1994      1995      1996      1997      1998      1997      1998      1998       1999
-------   -------   -------   -------   -------   -------   -------   -------   --------
(IN THOUSANDS)

SPAR COMPANIES
Statement of Operations
Data:
Net revenues.............  $14,144   $18,973   $14,425   $35,574   $36,804   $27,202   $32,601   $9,602    $21,637
Gross profit.............    6,399     8,669     6,746    13,820    17,387    12,623    16,384    4,764      7,264
Selling, general and
administrative.........    5,264     7,922     7,030    13,477    12,248     9,310    10,120    2,938      4,951
Operating income
(loss).................    1,135       747      (284)      343     5,139     3,313     6,264    1,826      2,313
Interest and other
expense, net...........       39        69        99       766       390       295       155       95        371
Net income (loss)........  $ 1,096   $   678   $  (383)  $  (423)  $ 4,749   $ 3,018   $ 6,109   $1,731    $ 1,942
=======   =======   =======   =======   =======   =======   =======   ======    =======

AS OF MARCH 31,                                 AS OF
------------------------------------------------   DEC. 31,   MARCH 31,
1994      1995      1996       1997      1998       1998       1999
------    ------    -------    ------    -------   --------   ---------
(IN THOUSANDS)

Balance Sheet Data:
Working capital (deficit).........  $ (124)   $  503    $ 1,665    $1,319    $ 3,412   $(2,326)   $(11,993)
Total assets......................   4,501     3,834     10,129     8,868     10,896    14,965      34,142
Total long-term debt..............      28       604      1,389       937        828       311       2,338
Stockholders' equity (deficit)....     731       512      1,017       935      3,142    (1,517)       (337)

SELECTED COMBINED FINANCIAL DATA OF MCI PERFORMANCE GROUP, INC.

SMCI acquired substantially all the assets of MCI in January 1999. The
following selected financial data sets forth, for the periods and the dates
indicated, selected financial data of MCI. The selected statements of operations
data presented below with respect to the years ended December 31, 1996, 1997 and
1998, and the balance sheet data at December 31, 1997 and 1998, have been
derived from the MCI audited financial statements included elsewhere herein. The
statements of operations data for the years ended December 31, 1994 and 1995,
and the balance sheet data at December 31, 1994, 1995 and 1996, are derived from
unaudited financial statements not included herein. The selected financial data
presented below are qualified by reference to the MCI financial statements and
should be read in conjunction with such financial statements and related

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notes thereto and "Management's Discussion and Analysis of Financial Condition
and Results of Operations of SPAR" contained elsewhere in this Proxy Statement.

YEAR ENDED DECEMBER 31,
---------------------------------------------------
1994       1995       1996       1997       1998
-------    -------    -------    -------    -------
(IN THOUSANDS)

MCI
Statement of Operations Data:
Net revenues...........................  $17,449    $25,066    $33,161    $42,294    $33,196
Gross profit...........................    4,168      6,714      7,010     10,572      7,088
Selling, general and administrative....    4,770      6,842      6,571      9,757      6,781
Operating income (loss)................     (602)       (98)       439        815        307
Interest and other (income) expense,
net.................................       56         51         (4)        43        (77)
Net income (loss)......................     (658)      (149)       443        771        383
=======    =======    =======    =======    =======

AS OF DECEMBER 31,
--------------------------------------------------
1994       1995       1996       1997       1998
-------    -------    -------    -------    ------
(IN THOUSANDS)

Balance Sheet Data:
Working capital.........................  $(2,035)   $(2,318)   $(1,802)   $(1,860)   $ (769)
Total assets............................  $ 4,191    $ 6,252    $ 7,829    $11,921    $8,718
Total long-term debt....................       70         --         --      1,219        --
Stockholders' equity (deficit)..........   (1,289)    (2,003)    (1,560)      (789)     (406)

SELECTED PRO FORMA COMBINED FINANCIAL INFORMATION

The following selected financial data sets forth certain unaudited pro
forma combined financial data for PIA, the SPAR Companies and MCI. The data
gives effect to the MCI Acquisition and the Merger under the purchase method of
accounting. The unaudited pro forma statement of operations data for the year
ended December 31, 1998 and the three-month period ended March 31, 1999 give
effect to the MCI Acquisition and Merger as if they had occurred at the
beginning of the periods. The unaudited pro forma balance sheet data gives
effect to the Merger as if it had occurred March 31, 1999. The unaudited pro
forma financial information has been prepared based on a number of assumptions
that are directly attributed to the MCI Acquisition and Merger and which are
expected to have a continuing impact on the operations of the Combined Company.
For further information on the manner in which the summary pro forma data was
derived, see "Unaudited Pro Forma Combined Financial Information." The following
data should be read in conjunction with the consolidated financial statements of
PIA contained elsewhere herein, and the consolidated financial statements of the
SPAR Companies, the financial statements of MCI, and the pro forma combined
financial information regarding the MCI Acquisition and Merger, appearing
elsewhere in this Proxy Statement.

The unaudited pro forma combined statements of operations exclude a
one-time, non-cash non-tax deductible charge which will be based on the stock
price on the Effective Date (approximately $752,000, or $0.04 per combined pro
forma share, based on an average closing price of $2.25 over the six day trading
period ending on May 19, 1999) resulting from the grant of 134,114 options and
issuance of 200,000 shares of SAI Common Stock to a consultant to SPAR prior to
the Merger. The 134,114 options and 200,000 shares of SAI Common Stock are
included in determining the pro forma basic and diluted weighted average number
of shares.

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The unaudited pro forma combined financial information is presented for
illustrative purposes only and is not necessarily indicative (a) of the
operating results that would have occurred if the MCI Acquisition and Merger had
been consummated as of such dates and (b) the financial position if the Merger
had been consummated as of March 31, 1999, nor is it necessarily indicative of
future operating results or financial position.

THREE MONTHS
YEAR ENDED            ENDED
DECEMBER 31, 1998    MARCH 31, 1999
-----------------    --------------

SPAR/PIA -- PRO FORMA
Statement of Operations Data:
Net Revenues..............................................     $   197,186        $    44,028
Gross Profit..............................................          44,576              9,083
Selling, general and administrative.......................          41,326             10,103
Goodwill amortization.....................................           1,622                371
Operating income (loss)...................................           1,628             (1,391)
Interest and other expense................................             824                330
Net income (loss).........................................     $       212        $    (1,736)
===========        ===========
Net income (loss) per share:
Basic..................................................     $      0.01        $     (0.10)
===========        ===========
Diluted................................................     $      0.01        $     (0.10)
===========        ===========
Shares used in computing pro forma net income (loss) per
share
Basic..................................................      18,135,773         18,135,773
===========        ===========
Diluted................................................      18,135,773         18,135,773
===========        ===========

DECEMBER 31,
1998
------------

Balance Sheet Data:
Working capital (deficit).................................    $  8,857
Total assets..............................................      66,649
Total long-term debt......................................       4,428
Stockholders' equity......................................      13,761

COMPARATIVE PER SHARE DATA

The following tables present certain historical, pro forma and pro forma
equivalent per share data for PIA, the SPAR Companies and MCI. The pro forma
data do not purport to be indicative of the results of future operations or the
results that would have occurred had the Merger been consummated at the
beginning of the periods presented. The information presented herein should be
read in conjunction with the Unaudited Pro Forma Combined Financial Information,
including the notes thereto, appearing elsewhere in this Proxy Statement.
Neither PIA, nor any SPAR Company, nor MCI has paid cash dividends on their
respective common stock for the periods presented. The SPAR Companies and MCI
have made, and prior to the Merger may make in certain instances, S corporation
distributions to shareholders for, among other things, tax obligations and
reinvestments in affiliate operations.

YEAR ENDED      THREE MONTHS ENDED
JANUARY 1, 1999      APRIL 2, 1999
----------------   ------------------

PIA -- HISTORICAL
Loss per share:
Basic.....................................................       $(0.78)             $(0.61)
Diluted...................................................        (0.78)              (0.61)
Book value per common stock at end of period (excludes
507,000 shares of Treasury stock)......................         2.96                2.08

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YEAR ENDED       THREE MONTHS ENDED
DECEMBER 31, 1998     MARCH 31, 1999
-----------------   ------------------

SPAR COMPANIES/MCI -- PRO FORMA
Income (loss) per share:
Basic.....................................................        $0.29               $ 0.09
Diluted...................................................         0.29                 0.09
Book value per common stock at end of period..............          N/A                (0.03)

YEAR ENDED       THREE MONTHS ENDED
DECEMBER 31, 1998     MARCH 31, 1999
-----------------   ------------------

SPAR/PIA -- PRO FORMA
Income (loss) per share:
Basic.....................................................        $0.01               $(0.10)
Diluted...................................................         0.01                (0.10)
Book value per common stock at end of period..............          N/A                 0.76

YEAR ENDED       THREE MONTHS ENDED
DECEMBER 31, 1998     MARCH 31, 1999
-----------------   ------------------

PIA -- EQUIVALENT PRO FORMA
Income (loss) per share:
Basic.....................................................        $0.01               $(0.10)
Diluted...................................................         0.01                (0.10)
Book value per common stock at end of period..............          N/A                 1.77

MARKET PRICE DATA

The PIA Common Stock is traded on the Nasdaq National Market under the
symbol "PIAM." On February 26, 1999, the last trading day for which bid and ask
information is available prior to the public announcement of the execution and
delivery of the Merger Agreement, the ask and the bid prices of the PIA Common
Stock were $4 1/8 and $3 7/8, respectively (there were no sales on February 26,
1999). On June 24, 1999, the most recent date for which it was practicable to
obtain market price information prior to the printing of this Proxy Statement,
the high and low sales prices were $3 15/16 and $3 13/16, respectively. There is
no public market for the capital stock of SAI or any other SPAR Company.

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RISK FACTORS

Statements contained in this Proxy Statement using forward-looking
terminology, such as "may," "might,"will," "expect," "anticipate," "estimate,"
"believe," "seek" or "continue" or the negative thereof or other variations
thereon or comparable terminology, are forward-looking statements. The
discussions set forth below constitute cautionary statements identifying
important factors with respect to such forward-looking statements, including
risks and uncertainties, that could cause actual results to differ materially
from results referred to in the forward-looking statements. There can be no
assurance that PIA's or SPAR's expectations regarding any of these matters will
be fulfilled. PIA stockholders should carefully read these risk factors before
voting their shares of PIA Common Stock.

RISKS RELATING TO THE MERGER

AN INCREASE IN THE MARKET PRICE OF PIA COMMON STOCK PRIOR TO THE EFFECTIVE
TIME MAY EFFECTIVELY RESULT IN A HIGHER PURCHASE PRICE FOR SPAR

The Amended Exchange Ratio is fixed and will not be adjusted in the event
of any increase or decrease in the market price of PIA Common Stock. While
dollar fluctuations in the market price of PIA Common Stock will not affect the
Amended Exchange Ratio, they may change the aggregate value of the shares of PIA
Common Stock and Substitute Options issued in the Merger. The aggregate value,
or the purchase price for SPAR, may, therefore, increase if the market price for
PIA Common Stock increases. The market price of PIA Common Stock at the
Effective Time may vary from its price on the date of this Proxy Statement and
on the date of the Annual Meeting. Such variations may be the result of changes
in the business, operations or prospects of PIA, market assessments of the
likelihood that the Merger will be consummated, the timing thereof, the
prospects of post-Merger operations, regulatory considerations, general market
and economic conditions and other factors. Because the Effective Time will occur
at a date later than the Annual Meeting, there can be no assurance that the
market price of PIA Common Stock on the date of such meeting will be indicative
of its price at the Effective Time. The Merger Agreement provides that the
Effective Time will occur no later than two business days following the
satisfaction or, to the extent permitted by law, the waiver by either PIA or
SPAR of all other conditions set forth in the Merger Agreement. PIA stockholders
are urged to obtain current market quotations for PIA Common Stock in order to
determine the current market price of the Merger Consideration. See "Proposal I:
Share/Option Issuance -- Merger Agreement."

ING BARINGS HAS NOT RENDERED, AND PIA MAY NOT BE ABLE TO OBTAIN, A FAIRNESS
OPINION ON THE AMENDED EXCHANGE RATIO, THE FINAL SPAR PERCENTAGE OR THE
FINAL SPAR MULTIPLIER

ING Barings did not provide an updated opinion after the Merger Agreement
was amended to take into account the Final SPAR Percentage and/or the Final SPAR
Multiplier. The fairness opinion, therefore, only addresses the fairness of the
Initial Exchange Ratio to the PIA stockholders from a financial point of view in
accordance with the terms of the Merger Agreement before it was amended. The
Initial Exchange Ratio referred to by ING Barings in its opinion was based upon
PIA issuing an aggregate of approximately 12.3 million shares of PIA Common
Stock to the SAI Stockholders and the holders of Substitute Options (assuming
full exercise thereof) which represented approximately 69.3% of the outstanding
shares of PIA Common Stock or approximately 2.25 times the number of shares of
PIA Common Stock outstanding on February 28, 1999. The Merger Agreement was
subsequently amended to increase the consolidated net worth of SPAR required
under the agreement from $500,000 to $1,436,000 (in each case, after giving
effect to the exclusion of certain charges and other costs as set forth in the
Merger Agreement) and an increase in the percentage of shares of PIA Common
Stock to be issued to the SAI Stockholders and the holders of Substitute Options
(assuming full exercise thereof) in the Merger was made from 69.3% to 70% or
2 1/3 times the number of shares of PIA Common Stock outstanding which
represents an aggregate of approximately 12.8 million shares of PIA Common Stock
(based on the number of shares of PIA Common Stock outstanding as of June 7,
1999). While the Initial Exchange Ratio referred to in the ING Barings opinion
and the Amended Exchange Ratio are each one-to-one, the number of shares of PIA
Common Stock issuable is greater with the Amended Exchange Ratio than with the
Initial Exchange Ratio, and, accordingly, the Initial SPAR Percentage is less
than the Final SPAR Percentage, and the Initial SPAR Multiplier is less than the
Final SPAR Multiplier. Therefore, the Initial Exchange Ratio and the Amended
Exchange Ratio are not equivalent. ING Barings has not been retained to render
any opinion on the Amended Exchange Ratio. ING

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Barings disclaims any inference or implication that may be drawn or suggests
that the Amended Exchange Ratio is equivalent to the Initial Exchange Ratio or
that the Amended Exchange Ratio is fair from a financial point of view or
otherwise to PIA or its stockholders. ING Barings has not been retained to
review the Amended Exchange Ratio with a view to rendering an opinion thereon.
There can be no assurance that PIA would be able to obtain a fairness opinion
with respect to the Amended Exchange Ratio, the Final SPAR Percentage and/or the
Final SPAR Multiplier.

INTEGRATING THE OPERATIONS OF PIA AND SPAR MAY BE DIFFICULT AND EXPECTED
BENEFITS MAY NOT OCCUR

PIA and SPAR believe that the Merger will result in long-term strategic
benefits. However, the realization of these benefits will depend on whether
management of the Combined Company can integrate the operations of the SPAR
Companies and the PIA Companies in an efficient and effective manner. Based upon
a number of factors, the Combined Company may encounter difficulties integrating
the operations of the SPAR Companies and the PIA Companies. The Combined Company
may also experience the loss of key personnel. Although both the PIA Companies
and the SPAR Companies have substantial in-store merchandising activities, PIA
and SPAR use different strategies and technologies, target different client
segments and also offer different services. The integration of the PIA Companies
and the SPAR Companies, which have previously operated independently, will
require substantial effort from the Combined Company, including the coordination
of their sales and marketing efforts and integration of their product lines and
personnel. Further, the SPAR Marketing Companies are still in the process of
integrating certain of their operations with those of SMCI, which acquired
substantially all of the assets of MCI in January 1999. There can be no
assurance that the benefits expected from the integration of PIA and SPAR will
be realized.

The Combined Company may not be successful as an integrated provider of
in-store merchandising or other outsourced marketing services. In addition, its
targeted clients may not accept the Combined Company as a provider of such
services. If management's attention is diverted by any difficulties encountered
in the transition process (such as the interruption of, or a loss of momentum
in, the activities of the SPAR Companies and the PIA Companies, problems
associated with integration of management information and reporting systems, and
delays in implementation of consolidation plans) the Combined Company may be
unable to realize anticipated benefits from the Merger.

THE COMBINED COMPANY MAY FAIL TO ACHIEVE BENEFICIAL SYNERGIES FROM THE
MERGER

SPAR and PIA management have entered into the Merger Agreement with the
expectation that the Merger will result in beneficial synergies to the Combined
Company. Achieving these anticipated synergies will depend on a number of
factors, including, without limitation, the successful integration of SPAR's and
PIA's operations and general and industry-specific economic factors. If these
benefits are not achieved, the revenues of the Combined Company could decline.
Among the expected benefits during 1999 are savings of (1) approximately $.4
million from improved rates for telecommunications due to volume discounts and
the use of SPAR's infrastructure, (2) approximately $.7 million from centralized
recruiting and salary and benefit expense management, (3) approximately $1.2
million in reduced travel related expenses due to the larger pool of employees
located in more geographic regions, (4) approximately $1.8 million from
streamlining PIA field management through the use of SPAR's Internet-based and
other technology, and (5) approximately $1.1 million from the elimination of
redundant equipment, facilities and related expenses. Even if the Combined
Company is able to integrate the technological systems and other operations of
the PIA Companies and the SPAR Companies, and economic conditions remain stable,
there can be no assurance that any of the anticipated synergies will be
achieved. See "-- PIA and SPAR Have a History of Losses and the Combined Company
May Be Unprofitable in the Future."

THE COMBINED COMPANY WILL INCUR SIGNIFICANT TRANSACTION CHARGES AS A RESULT
OF THE MERGER WHICH MAY OFFSET ANY ANTICIPATED GAINS

The parties expect to incur aggregate costs of approximately $12.0 million
(a portion of which has already been incurred as of the date of this Proxy
Statement) primarily for investment banking, legal and accounting fees and
severance payments incurred in connection with the Merger and other costs and
expenses associated with combining the operations of the two companies,
including restructuring costs. These costs will be recorded by the Combined
Company as part of the purchase price at the time the Merger is consummated.
There can be no assurance that combining the businesses of the SPAR Companies
and the PIA Companies,

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31

even if achieved in an efficient and effective manner, will result in combined
results of operations and financial condition superior to what would have been
achieved by either company independently. In accordance with purchase accounting
rules, the historical book values of the assets and liabilities of PIA will be
adjusted to their fair values. The costs incurred to complete the Merger plus
the excess of the fair value of the consideration paid over the adjusted fair
values of the assets and liabilities of the Combined Company will be recorded by
it as goodwill, which will be amortized over approximately 15 years resulting in
additional expenses of approximately $0.8 million per year.

THE PIA STOCKHOLDERS WILL SUFFER IMMEDIATE AND SUBSTANTIAL DILUTION TO
THEIR VOTING POWER WHICH MAY LOWER THE MARKET PRICE OF THE PIA COMMON STOCK

The issuance of PIA Common Stock in connection with the Merger could reduce
the market price of the PIA Common Stock unless the market perceives that the
combined revenues, assets and business or potential growth, cost savings and
other business synergies are sufficient to offset the effect of such issuance.
In addition, as a result of the Merger, any given PIA stockholder's percentage
ownership of PIA Common Stock prior to the Merger will decrease substantially.
The percentage ownership of all pre-Merger PIA stockholders will decrease from
100% of the issued and outstanding capital stock of PIA immediately prior to the
Merger to approximately 30% of the issued and outstanding capital stock of PIA
immediately following the Merger (assuming full exercise of all Substitute
Options and without regard to vesting). As a result, PIA stockholders
immediately prior to the Merger will experience an immediate reduction in their
voting power and could experience a material reduction in their interest in PIA
with respect to earnings per share, liquidation and book and market value per
share in connection with the Merger.

THE CURRENT PIA STOCKHOLDERS WILL SUFFER FURTHER DILUTION IF OPTIONS
GRANTED TO SPAR EMPLOYEES ARE EXERCISED

If the Option Plan Amendment is approved by the PIA stockholders, options
covering approximately 2.1 million shares of PIA Common Stock will be granted to
SPAR employees in connection with the Merger, representing approximately 97% of
the additional 2.2 million shares which will be reserved for issuance under the
1995 Option Plan. If all such options are exercised, the ownership interests and
voting power of the current PIA stockholders will be further reduced. See
"Proposal I: Share/Option Issuance -- Additional Grants to SPAR Employees and
Other Individuals" and "Proposal VI: Option Plan Amendment."

SAI STOCKHOLDERS WILL CONTROL THE COMBINED COMPANY AND COULD DETER A FUTURE
TAKEOVER

Upon the consummation of the Merger, the SAI Principals will beneficially
own approximately 67.6% of the outstanding PIA Common Stock in the aggregate and
the SAI Stockholders and SAI Option Holders together will beneficially own
approximately 70% of the outstanding PIA Common Stock in the aggregate (based on
the number of shares outstanding as of the Record Date assuming full exercise of
all Substitute Options, but no exercise of any other PIA options or warrants).
As a result, such persons, if they act together, generally will be able to elect
all directors, exercise control over the business, policies and affairs of the
Combined Company and will have the power to approve or disapprove most actions
requiring stockholder approval, including amendments to the Combined Company's
charter and bylaws, certain mergers or similar transactions, sales of all or
substantially all of the Combined Company's assets, and the power to prevent or
cause a change in control of the Combined Company. In the future, this situation
could make the acquisition of control of the Combined Company and the removal of
management more difficult.

THE COMBINED COMPANY MAY LOSE CUSTOMERS WHO COMPETE AGAINST EACH OTHER

Several significant customers of SPAR prohibit SPAR from working with their
competitors without the customer's prior written consent. Similarly, several
significant customers of PIA prohibit PIA from working with their competitors
(who may be customers of SPAR) without their prior consent. The Combined Company
may lose one or more of these customers (who compete against each other) pending
or following the Merger. No assurance can be given that measures contemplated to
alleviate these concerns (i.e., maintaining the competing customers' business in
separate Divisions, or obtaining consents from each competing customer) will be
effective.

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IF THE MERGER WITH SPAR IS NOT CONSUMMATED PIA MAY HAVE TO MAKE CHANGES IN
OPERATIONS AND SEEK ADDITIONAL FINANCING

The consummation of the Merger depends upon the approval of the
Share/Option Issuance, each of the Pre-Merger Charter Amendments, the Option
Plan Amendment and the Reverse Split Proposal at the Annual Meeting. Failure to
obtain such approval could result in termination by SAI of the Merger Agreement.
If the Merger with SAI does not occur, PIA may need to find additional financing
and undergo significant restructuring in order to continue its operations. If
the Merger Agreement is terminated by PIA because it accepts an acquisition
proposal from a third party, PIA will be obligated to pay to SPAR a termination
fee in an amount equal to approximately 3.5% of the value of the consideration
in connection with such acquisition proposal, plus the reasonable expenses
incurred by SPAR in connection with the Merger.

INVESTORS MAY HAVE DIFFICULTY TRADING AND THE COMBINED COMPANY MAY HAVE
DIFFICULTY RAISING CAPITAL IF THE COMBINED COMPANY IS UNABLE TO MAINTAIN A
LISTING OF THE PIA COMMON STOCK ON NASDAQ

PIA received a letter dated May 7, 1999 from the Nasdaq National Market
stating that the staff of the Nasdaq National Market believes that the
consummation of the Merger will result in a change in control and change in
financial structure of PIA, and therefore will require PIA to comply with the
Nasdaq National Market's initial listing criteria. On May 20, 1999, PIA
submitted a letter to the Nasdaq National Market contesting this determination.
On June 21, 1999, PIA received a letter from the Nasdaq National Market
confirming its position that PIA must comply with the Nasdaq National Market's
initial listing criteria and on June 22, 1999 PIA submitted a letter to the
Nasdaq National Market requesting a hearing to appeal this determination. If the
hearings panel does not find in PIA's favor, PIA will be required to submit an
initial listing application. As of the date of this Proxy Statement, PIA did not
meet the Nasdaq National Market $5.00 minimum bid price requirement for initial
listing. Even if the Combined Company is successful in satisfying the initial
listing criteria, it must continue to meet the Nasdaq National Market's
maintenance criteria. There is no assurance that PIA will be able to meet such
criteria and/or that the Nasdaq National Market will continue to list the PIA
Common Stock. If the PIA Common Stock were delisted from the Nasdaq National
Market, the Combined Company may attempt to list the PIA Common Stock on another
stock exchange, the Nasdaq SmallCap Market or on the OTC Bulletin Board. In such
case, an investor in the Combined Company may find it more difficult to dispose
of, or to obtain accurate quotations as to the market value of the PIA Common
Stock. This lack of liquidity may also cause the Combined Company to have
difficulty raising capital for its operations or making acquisitions in the
future. In addition, listing on the Nasdaq National Market of the shares of PIA
Common Stock to be issued in the Merger is a condition to the closing of the
Merger. PIA cannot assure that it will be able to comply with, or that SPAR will
agree to waive this condition. See "Proposal V: Reverse Split
Proposal -- Reasons for the Reverse Split."

OFFICERS AND DIRECTORS OF PIA WILL RECEIVE BENEFITS THAT ARE CONTRARY TO
THE INTERESTS OF OTHER STOCKHOLDERS

In considering the recommendations in favor of the Merger by the PIA Board,
PIA stockholders should be aware that certain directors and executive officers
of PIA may be entitled to specific benefits if the Merger is consummated.
Accordingly, their interests in the Merger may be contrary to those of the PIA
stockholders. Under certain employee benefit plans or contracts created by PIA,
some officers of PIA, including, Terry R. Peets, the chief executive officer and
Cathy L. Wood, the chief financial officer, are entitled to accelerated vesting
of their options and other benefits as well as severance benefits if their
employment is terminated in certain circumstances within a specified period
after the Merger. Further, each of PIA's directors and officers will benefit
from PIA's and SPAR's commitments to provide indemnification for PIA's officers
and directors, and directors' and officers' liability insurance for a period of
six years after the consummation of the Merger. The PIA Board considered these
interests, together with other relevant factors, in deciding to recommend that
PIA stockholders approve the Merger. See "Proposal I -- The Share/Option
Issuance -- Interests of Certain Persons in the Merger."

THE VOTING INTERESTS OF THE PIA STOCKHOLDERS MAY BE DILUTED AS A RESULT OF
THE ISSUANCE OF PIA COMMON STOCK UNDER THE MCI NOTE

Under the promissory note dated as of January 15, 1999, from SMCI to MCI,
MCI may elect to receive up to $3 million of the final installment payment in
unregistered shares of common stock of any publicly

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traded company holding, directly or indirectly, all of the issued and
outstanding stock of SMCI, valued at the average public trading price for the 30
day period preceding the maturity date. If MCI makes this election following the
consummation of the Merger), it will receive shares of PIA Common Stock valued
accordingly. This will result in a decrease in percentage of ownership and
voting power of the PIA stockholders.

OTHER RISKS RELATING TO PIA, SPAR AND THE COMBINED COMPANY

THE COMBINED COMPANY MAY BE UNABLE TO MEET ITS CAPITAL NEEDS OR OBTAIN
ADDITIONAL FINANCING

To satisfy the obligations it will incur in connection with the Merger and
for the future operation of its business, the Combined Company will require
substantial capital, which it may not be able to obtain. As of March 31, 1999,
on a pro forma basis, the Combined Company had total current liabilities of
$48.5 million and a working capital deficit of $8.9 million. A portion of such
current liabilities were incurred in connection with the MCI Acquisition. The
MCI Acquisition was financed in part through the issuance of a promissory note
in the aggregate original principal amount of approximately $12.4 million (plus
the amount of any earnout payment required to be made in connection therewith)
which matures on September 15, 1999. The amount owed under this note is
estimated to be $10.8 million as of March 31, 1999 (inclusive of an approximate
$2 million net worth adjustment in SMCI's favor as estimated by SMCI and
exclusive of earn-out payments, if any). In addition, the SAI Principals loaned
SPAR $2,958,000 to facilitate the MCI Acquisition. If this indebtedness is not
repaid before the Merger is consummated, the Combined Company will assume these
obligations along with other liabilities of the SPAR Companies. The Combined
Company will also incur Merger related expenses (including accounting, legal and
investment banking fees and severance payments) estimated to be approximately
$5.4 million as of the date of this Proxy Statement. PIA is in discussions with
major banks to increase its credit line to enable it to meet its cash needs in
connection with the Merger and for the operation of the business of the Combined
Company (including future acquisitions). Failure to obtain such financing would
have a material adverse affect on the business, results of operations or
financial condition of the Combined Company.

A STOCKHOLDER'S OWNERSHIP INTEREST AND VOTING POWER MAY DECREASE AS A RESULT
OF NEW EQUITY ISSUANCES TO FINANCE ACQUISITIONS

In addition to funds needed by the Combined Company for working capital and
payment of Merger related expenses and indebtedness, in order to pursue the
Combined Company's operating strategy after the Merger, the Combined Company may
need to raise funds for any acquisitions or other expansion or to acquire new
technologies. If funds are raised through the issuance of equity securities of
the Combined Company, the percentage ownership of the Combined Company's
stockholders, and their voting power, will be reduced or the holders of such
equity securities may have rights, preferences or privileges senior to those of
the holders of PIA Common Stock. There can be no assurance that financing will
be available when needed on terms favorable to the Combined Company or at all.
If adequate funds are not available or are not available on acceptable terms,
the Combined Company may be unable to pursue its acquisitions, develop or
enhance its services, take advantage of future opportunities or respond to
competitive pressures, which could have a material adverse effect on the
Combined Company's business, financial condition and results of operations. See
"-- The Combined Company May Be Unable to Finance Future Acquisitions to Grow
Its Business."

PIA AND SPAR HAVE A HISTORY OF LOSSES AND THE COMBINED COMPANY MAY BE
UNPROFITABLE IN THE FUTURE

PIA has incurred losses in seven of the eight quarters during fiscal 1997
and 1998, resulting in a total net loss of $15.1 million for the year ended
December 31, 1997 ("fiscal 1997"), and $4.3 million for the year ended January
1, 1999 ("fiscal 1998"). PIA also incurred a net loss of $3.3 million for the
three months ended April 2, 1999. The SPAR Companies and MCI also incurred net
losses in certain prior periods. For each of the years ending March 31, 1996 and
1997, the SPAR Companies incurred a net loss of $0.4 million. There can be no
assurance that the Combined Company will not sustain losses after the Merger or
that the Combined Company can offset its accumulated losses with future income.
See "Management's Discussion and Analysis of Financial Condition and Results of
Operations of PIA" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations of SPAR."

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THE CONTINUED LOSS OR REDUCTION OF BUSINESS WILL HURT THE COMBINED
COMPANY'S FINANCIAL PERFORMANCE

The business mix of the PIA Companies has changed significantly over the
last year, and is expected to continue to change during 1999 in response to
client needs and the evolving outsourced retail merchandising industry. Due in
part to the completion of a major dedicated client program, and the loss of
several shared service clients, sales have declined over the last 18 months and
no sizeable new dedicated business has been able to compensate for these losses.
PIA has reduced its dedicated management and personnel infrastructure
accordingly.

INDUSTRY CONSOLIDATION HAS ADVERSELY AFFECTED PIA'S BUSINESS

The retail and manufacturing industries are undergoing consolidation
processes that result in larger but fewer retailers and suppliers. The Combined
Company's success depends in part upon its ability to maintain the existing
clients of the PIA Companies and the SPAR Companies and to obtain new clients.
As a result of industry consolidation, PIA has lost certain clients, and this
trend could continue to have a negative effect on the Combined Company's client
base and results of operations.

PIA'S AND SPAR'S REVENUES DEPEND LARGELY ON A FEW CLIENTS

PIA's ten largest clients generated approximately 69% and 75% of PIA's net
revenues for fiscal 1997 and fiscal 1998, respectively. During these periods,
none of PIA's manufacturer or retail clients accounted for greater than 10% of
net revenues, other than Buena Vista Home Entertainment and Eckerd Drug Stores,
which respectively accounted for 16.0% and 13.6% of net revenues for fiscal
1997, and Eckerd Drug Stores, CVS Pharmacy Incorporated and Buena Vista Home
Entertainment, which accounted for 15.6%, 12.6% and 10.6% of net revenues,
respectively, for fiscal 1998.

The SPAR Marketing Companies' ten largest clients generated approximately
63.4% and 68.4% of the SPAR Marketing Companies' net revenues for fiscal 1997
and fiscal 1998, respectively. During these periods, none of the SPAR Marketing
Companies' manufacturer or retail clients accounted for greater than 10% of net
revenues, other than Warner Home Video, Buena Vista Home Video and General
Motors Corporation, which accounted for 15.0%, 15.3% and 10.0% of net revenues
in fiscal 1997 and 24.6%, 13.6% and 13.7% of net revenues in fiscal 1998,
respectively.

MCI's ten largest clients generated approximately 70% and 63.0% of MCI's
net revenues for fiscal 1997 and fiscal 1998, respectively. During these
periods, none of MCI's manufacturer or retail clients accounted for greater than
10% of net revenues, other than MCI WorldCom (including its divisions), a
company not related to or affiliated with MCI, and Taco Bell Corp., which
accounted for 29% and 12% of net revenues for fiscal 1997, and 30% and 16% of
net revenues for fiscal 1998, respectively.

The majority of PIA's contracts with its clients for shared services have
multi-year terms. PIA and SPAR believe that the uncollectibility of amounts due
from any of their large clients, a significant reduction in business from such
clients, or the inability to attract new clients, could have a material adverse
effect on the Combined Company's business, financial condition and results of
operations.

THE BUSINESS AND GROWTH OF THE COMBINED COMPANY DEPENDS IN LARGE PART ON
THE TREND TOWARD OUTSOURCING OF MARKETING SERVICES WHICH MAY NOT CONTINUE

PIA and SPAR believe that the current trend in the outsourcing of marketing
services has resulted from the consolidation of retailers and manufacturers, as
well as their desire to seek outsourcing specialists and to reduce fixed
operating expenses. There can be no assurance that this trend in outsourcing
will continue, as companies may elect to perform such services internally. A
significant change in the direction of this trend generally, or a trend in the
retail manufacturer or business services industry not to use, or to reduce the
use of, outsourced marketing services such as those provided by the Combined
Company, would materially adversely affect the Combined Company's business,
financial condition and results of operations.

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THE MARKETING SERVICES INDUSTRY IS HIGHLY COMPETITIVE AND THE COMBINED
COMPANY MAY BE UNABLE TO COMPETE AGAINST LARGER COMPANIES WITH GREATER
RESOURCES

Competition in the marketing services industry arises from a number of
enterprises that are national in scope. As the marketing services industry
continues to evolve, additional competitors with greater resources than the
Combined Company may enter the marketing services industry or particular sectors
thereof. The PIA Companies and the SPAR Companies compete with (1) a large
number of relatively small enterprises with specific client, channel or
geographic coverage, (2) the internal marketing and merchandising operations of
their clients and prospective clients, (3) independent brokers and (4) smaller
regional providers. In addition, in the premium promotion and travel incentive
sector, SMCI competes with Carlson Marketing Group Inc., Maritz Inc. and BI
Services, each of which have significantly greater financial and marketing
resources than the Combined Company, as well as with Exceed Motivation,
Incentive Associates and regional and local suppliers. Although no industry-wide
study has been published, SPAR management believes that there are at least one
hundred competitors in the premium incentive industry. PIA management believes
there are over 150 competitors in the merchandising industry based upon
information recently posted on the web site of the National Association for
Retail Merchandising Services.

The Combined Company's clients with internal marketing and merchandising
capacity may choose to conduct more of their own merchandising services or
premium incentive programs. Furthermore, remaining competitive in the highly
competitive marketing services industry requires that the Combined Company
monitor and respond to trends in all industry sectors. There can be no assurance
that the Combined Company will be able to anticipate and respond successfully to
such trends in a timely manner.

The marketing services industry generally does not require significant
initial capital expenditures and thus the barriers to entry in this industry are
low. However, advanced technology has become a significant competitive
advantage. If certain competitors were to combine in integrated marketing
services companies, additional marketing service companies were to enter into
this market, or existing participants in this industry were to become more
competitive, the Combined Company's business, financial condition and results of
operations could be materially adversely affected.

PIA'S OPERATING RESULTS MAY FLUCTUATE BECAUSE ITS COMMISSION INCOME IS
UNCERTAIN

Approximately 15% of PIA's net revenues for fiscal 1998 were earned under
commission-based contracts. These contracts provide for commissions based on a
percentage of the client's net sales of certain of its products to designated
retailers. Under certain of these contracts, PIA generally receives a draw on a
monthly or quarterly basis, which is then applied against commissions earned.
Adjustments are made on a monthly or quarterly basis upon receipt of
reconciliations between commissions earned from the client and the draws
previously received. The reconciliations typically result in commissions owed to
PIA in excess of previous draws; however, PIA cannot predict with accuracy the
level of its clients' commission-based sales. Accordingly, the amount of
commissions in excess of or less than the draws previously received will
fluctuate and can significantly affect PIA's operating results in any quarter.

PROVISIONS IN PIA'S CHARTER DOCUMENTS AND DELAWARE LAW MAY DETER POTENTIAL
ACQUISITION BIDS, INCLUDING BIDS THAT MAY BENEFIT STOCKHOLDERS

After the Effective Time, the Certificate of Incorporation of PIA,
including any amendments thereto, will remain the Certificate of Incorporation
of the Combined Company. The PIA Board has the authority to issue up to
3,000,000 shares of preferred stock and to determine the price, rights,
preferences, privileges and restrictions, including voting rights, of those
shares without any further vote or action by the stockholders. The rights of the
holders of PIA Common Stock will be subject to, and may be adversely affected
by, the rights of the holders of any preferred stock that may be issued in the
future. The issuance of preferred stock could have the effect of making it more
difficult for a third party to acquire a majority of the outstanding voting
stock of the Combined Company. In addition, the Combined Company will be subject
to the anti-takeover provisions of Section 203 of the Delaware General
Corporation Law ("DGCL"), which prohibits the Combined Company from engaging in
a "business combination" with an "interested stockholder" for a period of three
years after the date of the transaction in which the person became an interested
stockholder, unless the business combination is approved in a prescribed manner.
The application of Section 203 also could have the

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effect of delaying or preventing a change in control of the Combined Company.
Further, certain provisions of the Combined Company's bylaws (e.g., the
requirement that the holder of shares entitled to cast no less than 30% of the
votes at a special meeting of stockholders may call such a special meeting) and
of the DGCL could delay or impede a merger, tender offer or proxy contest
involving the Combined Company, which could adversely affect the market price of
the PIA Common Stock.

THE COMBINED COMPANY MAY BE UNABLE TO IDENTIFY, ACQUIRE AND INTEGRATE
ADDITIONAL MARKETING SERVICES BUSINESSES ESSENTIAL TO ITS BUSINESS STRATEGY

Key components of the Combined Company's growth strategy are the
acquisition of businesses across the United States and Canada that offer
marketing or incentive services in which each of the Combined Company's
Divisions operates, as well as acquisitions in numerous other attractive sectors
within or related to the marketing services industry. After the Merger, the
successful implementation of this strategy depends upon the Combined Company's
ability to identify suitable acquisition candidates, acquire such businesses on
acceptable terms and integrate their operations successfully with those of the
Divisions of the Combined Company. There can be no assurance of the availability
of such candidates or, if such candidates are available, of the Combined
Company's ability to identify, acquire or integrate acquired businesses
successfully. In addition, in pursuing acquisition opportunities, the Combined
Company may compete with other entities with similar growth strategies, which
competitors may be larger and have greater financial and other resources than
the Combined Company. Competition for these acquisition targets could also
result in increased prices of acquisition targets and a diminished pool of
companies available for acquisition.

THE COMBINED COMPANY MAY BE UNABLE TO FINANCE FUTURE ACQUISITIONS TO GROW
ITS BUSINESS

After the consummation of the Merger, a significant portion of the Combined
Company's resources may be used for acquisitions. The timing, size and success
of such acquisition efforts and any associated capital commitments cannot be
readily predicted. If the Merger is consummated, future acquisitions may be
financed by issuing shares of PIA Common Stock, cash or a combination of PIA
Common Stock and cash. If the PIA Common Stock does not maintain a sufficient
market value, or if potential acquisition candidates are otherwise unwilling to
accept PIA Common Stock as part of the consideration for the sale of their
businesses, the Combined Company may be required to utilize more of its cash
resources, if available, in order to initiate and maintain its acquisition
program. If the Combined Company does not have sufficient cash resources, its
growth could be limited unless it is able to obtain additional capital through
debt or equity financings. There can be no assurance that the Combined Company
will be able to obtain additional financing it may need for its acquisitions on
terms that the Combined Company deems acceptable. To the extent PIA Common Stock
is used for all or a portion of the consideration to be paid for future
acquisitions, dilution may be experienced by existing stockholders. See "-- The
Combined Company May Be Unable to Meet Its Capital Needs or Obtain Additional
Financing."

THE COMBINED COMPANY MAY FAIL TO IMPLEMENT ITS OPERATING STRATEGY

There are several key elements to the Combined Company's operating
strategy, including capitalizing on cross-selling opportunities, achieving
operating efficiencies at its Divisions, operating on a decentralized basis and
implementing technology. After the Merger, the Combined Company's ability to
improve profitability through this operating strategy will be affected by
various factors, many of which are beyond its control, and such strategy may not
be successful. The Combined Company's failure to implement any part of its
operating strategy could materially adversely affect the Combined Company's
overall profitability and thus its business, financial condition and results of
operations. See "Business of SPAR -- Business Strategy," "Business of PIA" and
"Proposal I: Share/Option Issuance -- Strategy of the Combined Company." There
can be no assurance that the Combined Company will be able to cross-sell its
services successfully. The Combined Company's ability to achieve operating
efficiencies will be affected by various factors, including the availability of,
and the cost associated with the hiring and training of, retail merchandisers,
as well as its ability to leverage its corporate overhead over its existing
infrastructure. Moreover, the Combined Company may not be able to realize
sufficient concentration of clients in some geographic areas, which would limit
the efficiency and productivity of its labor force, as well as its ability to
reduce variable costs. If the Combined Company does not implement proper overall
business controls, the decentralized operating strategy could result in
inconsistent

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operating and financial practices at the Combined Company's subsidiaries and any
subsequently acquired businesses. With respect to technology, the Combined
Company may not be able to deploy SPAR's Internet and other technology across
divisional lines to enhance the services the PIA Division will provide.
Moreover, there can be no assurance that products or technologies developed by
others will not render the Combined Company's services uncompetitive or
obsolete.

THE COMBINED COMPANY'S QUARTERLY OPERATING RESULTS MAY VARY AND MAKE FUTURE
PROFITABILITY UNCERTAIN

The PIA Companies and the SPAR Companies have experienced, and the Combined
Company may continue to experience in the future, fluctuations in quarterly
operating results. There can be no assurance that the Combined Company's results
of operations will be profitable for any given fiscal period. See "Manage ment's
Discussion and Analysis of Financial Condition and Results of Operations of
SPAR" and "Manage ment's Discussion and Analysis of Financial Condition and
Results of Operations of PIA." Factors that may cause the Combined Company's
quarterly operating results to vary include the number of active customer
projects, the requirements of customer projects, the termination of major
customer projects, the loss of major customers, the timing of new engagements
and the timing of personnel cost increases. In particular, the timing of
revenues is difficult to forecast for the motion picture industry customers of
PIA and SMF because they can be dependent on the commercial success of movies or
home video releases of particular customers. In addition, SMCI's operating
results are subject to fluctuation because it recognizes revenues at the
completion of programs but expenses direct costs of projects as such costs are
incurred. Because of this policy, the timing of the commencement or completion
of a project, particularly at or near the end of any quarter, can cause
significant variations in operating results from quarter to quarter and could
result in losses for any particular period.

THE SAI PRINCIPALS HAVE POTENTIAL CONFLICTS OF INTEREST WITH THE COMBINED
COMPANY ARISING FROM SERVICES PROVIDED BY SMS AND SIT

Mr. Robert G. Brown, who will be a director and the Chairman and Chief
Executive Officer of the Combined Company, and Mr. William H. Bartels, who will
be a director and a Vice Chairman of the Combined Company, are the sole
stockholders and executive officers and directors of SMS, SPAR Infotech, Inc., a
Nevada corporation ("SIT"), and certain other companies that are not parties to
the Merger Agreement and will not be included in the Combined Company.

SMS provides substantial field representative and field management services
to the SPAR Marketing Companies on a cost-plus basis. SIT provides computer
programming services to SMF on an hourly fee basis. See "-- The SPAR Marketing
Companies May Be Held Liable for the Tax Liability of SMS" and "Business of
SPAR -- Certain Relationships and Related Party Transactions."

In the event of any dispute in the business relationships between the
Combined Company and SMS or SIT, or in the course of pursuing SMS's independent
contractor/employee dispute with the Internal Revenue Service ("IRS"), it is
possible that Messrs. Brown and Bartels may have one or more conflicts of
interest with respect to these relationships and dispute that could have a
material adverse effect on the Combined Company. See "Business of
SPAR -- Related Party Contingent Tax Liability," "Business of SPAR -- Certain
Relationships and Related Party Transactions" and "Notes to the Combined
Financial Statements of SPAR."

THE SPAR MARKETING COMPANIES MAY BE HELD LIABLE FOR THE TAX LIABILITY OF
SMS

The SPAR Marketing Companies currently receive, and in the past have
received, from SMS various field representative and field management services.
SMS is engaged in a dispute with the IRS concerning the status of certain of
SMS's independent contractors, which the IRS has asserted should be classified
as employees for federal employment tax purposes. SMS has informed SPAR that SMS
could owe the U.S. Treasury on a worst case basis up to approximately $6.6
million in employment taxes (including withholding for income taxes), penalties
and interest if the IRS were to prevail in full in its dispute with SMS
(assuming none of the independent contractors ever paid any of his or her
self-employment taxes). Although SMS is not a party to the Merger Agreement or
SPAR Reorganization Agreement and SPAR has not entered into any tax sharing or
tax indemnification arrangement with SMS, there can be no assurance that the IRS
will not

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attempt to collect these employment taxes from the SPAR Marketing Companies, as
a result of their common control and business relationships with SMS during the
period such liabilities were incurred. See "Business of SPAR -- Related Party
Contingent Tax Liability."

Messrs. Brown and Bartels, the SAI Principals, are the owners, directors
and officers of SMS and, prior to the acquisition of the SPAR Companies by SAI
in the SPAR Reorganization Transactions, directly owned all the stock of the
SPAR Companies. SMS is a separate corporation and is not being acquired by any
of the SPAR Companies or PIA Companies. See "Risk Factors -- The SAI Principals
Have Potential Conflicts of Interest With the Combined Company Arising From
Services Provided by SMS and SIT."

In performing field and other services for the SPAR Marketing Companies,
SMS has informed the SPAR Marketing Companies that SMS has treated, and expects
to continue to treat, a substantial number of merchandising service providers
and other field representatives as independent contractors, not employees. There
can be no assurance, however, that the IRS will agree with SMS's
characterization, or that SMS will be able to favorably settle with the IRS. See
"Business of SPAR -- Related Party Contingent Tax Liability."

Accordingly, if SMS is unable to pay such taxes or otherwise prevail in or
settle its dispute with the IRS, the IRS might seek to collect all or a portion
of such tax liability from the SPAR Marketing Companies. If SMS is unsuccessful
in its challenge against the IRS's adverse independent contractor determination,
and the IRS were to assert successfully that one or more of the SPAR Marketing
Companies are legally responsible for all or a portion of such liability, it
could have a material adverse effect on the Combined Company's business,
financial condition and results of operations. In addition, if SMS's field
representatives are required to be treated as employees, the additional cost of
such reclassification is passed on to the Combined Company, and the Combined
Company is unable to obtain these services elsewhere, the Combined Company may
incur significant additional operating costs which could have a material adverse
effect on the Combined Companies' business, financial condition and results of
operations.

THE COMBINED COMPANY WILL DEPEND ON ITS FUTURE PERFORMANCE TO SATISFY ITS
SIGNIFICANT DEBTS AND LIABILITIES

As of March 31, 1999, on a pro forma basis, the Combined Company had
approximately $54.7 million in liabilities, with approximately $48.5 million of
such liabilities representing current liabilities and approximately $4.5 million
representing long-term debt. The Combined Company's ability to make scheduled
payments on or to refinance its obligations will depend on its financial and
operating performance, which is subject to prevailing industry and economic
conditions and to financial, business and other factors beyond its control. In
the event the Combined Company is unable to meet its obligations with respect to
its existing debt, it may be required to refinance all or a portion of its
existing debt or to obtain additional financing. There can be no assurance that
the Combined Company would have the ability to obtain such financing. Failure to
obtain such financing would have a material adverse effect on the business,
financial condition and results of operations of the Combined Company. Moreover,
Mr. Bartels and Mr. Brown have pledged their shares of SMCI to MCI as security
for the note to MCI. If such indebtedness to MCI is not repaid, MCI may
foreclose on the securities which would have a material adverse effect on the
business, financial condition and results of operations of the Combined Company.
Lastly, PIA is negotiating with its existing lender to increase the amount it
may borrow under its existing credit facility for the Combined Company. This
debt may limit the Combined Company's ability to obtain additional financing on
acceptable terms.

YEAR 2000 ISSUES MAY AFFECT PIA'S ABILITY TO EFFICIENTLY DEPLOY ITS STAFF

The most reasonably likely worst case scenario for PIA with respect to Year
2000 involves Year 2000 problems experienced by PIA's staffing suppliers. In
such a scenario, PIA's ability to efficiently deploy the necessary staff to
service its clients' needs could be negatively affected. Other than hiring
additional employees to reduce its dependence on these suppliers, PIA has not,
and does not intend to, develop a contingency plan for potential Year 2000
problems.

The extent and magnitude of the Year 2000 problem as it will affect PIA,
both before and after January 1, 2000, is difficult to predict or quantify for a
number of reasons. These include the lack of control over systems that are used
by third parties, the complexity of testing inter-connected networks and
applications that depend on third party networks and the uncertainty surrounding
how others will deal with
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liability issues raised by Year 2000 related failures. If any of these third
parties experience Year 2000 problems, it could have a material adverse effect
on PIA.

SPAR'S REVENUES AND PROFITS MAY DECREASE DUE TO THIRD PARTIES' YEAR 2000
NONCOMPLIANCE

SPAR believes that the most reasonably likely worst case scenario facing
SPAR with respect to the Year 2000 problems is a lack of compliance on the part
of third parties with which it deals, which may result in lost revenue and
profits. These include delays in deliveries to and from clients due to supply,
processing and/or transmission problems, utility failures, and customer
non-compliance (such that customers are unable to make normal use of SPAR's
services and/or are unable to make payments to SPAR within their normal payment
practices).

SPAR's management believes that it may not be possible to determine with
any certainty (i) that all Year 2000 issues affecting SPAR have been identified
or corrected, (ii) how or when any particular Year 2000 related failure will
occur, or (iii) the severity, duration, or financial consequences of any Year
2000 related failure. Accordingly, there can be no assurance that SPAR will not
suffer from operational inconveniences and inefficiencies or even serious system
failures caused by SPAR's Year 2000 problems or those of its clients. Such
problems may divert management's time, attention and resources from its ordinary
business activities which could have a material adverse effect on SPAR.

THE ANNUAL MEETING

PIA is furnishing this Proxy Statement to holders of PIA Common Stock in
connection with the solicitation of proxies by the PIA Board for use at the
Annual Meeting. This Proxy Statement and accompanying form of proxy are first
being mailed to the stockholders of PIA on or about June 28, 1999.

PURPOSE, TIME AND PLACE

At the Annual Meeting, holders of PIA Common Stock will be asked to vote
upon the proposals (collectively, the "PIA Proposals") to approve the
Share/Option Issuance, each of the Pre-Merger Charter Amendments, the Option
Plan Amendment and the Reverse Split Proposal, to elect seven directors to the
PIA Board and to transact such other matters as may properly come before the
Annual Meeting. The Annual Meeting will be held at PIA Merchandising Services,
Inc. located at 19900 MacArthur Boulevard, Suite 900, Irvine, California 92612
on Thursday, July 8, 1999, at 9:00 a.m., Pacific Time.

The PIA Board has unanimously determined that the approval of the
Share/Option Issuance, each of the Pre-Merger Charter Amendments, the Option
Plan Amendment and the Reverse Split Proposal are in the best interests of PIA
and the stockholders of PIA, and the PIA Board has approved the Share/Option
Issuance, each of the Pre-Merger Charter Amendments, the Option Plan Amendment
and the inclusion of the Reverse Split Proposal in the Proxy Statement. THE PIA
BOARD UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS OF PIA VOTE "FOR" APPROVAL OF
THE SHARE/OPTION ISSUANCE, EACH OF THE PRE-MERGER CHARTER AMENDMENTS, THE OPTION
PLAN AMENDMENT AND THE REVERSE SPLIT PROPOSAL AND "FOR" THE ELECTION OF THE
SEVEN NOMINEES SET FORTH HEREIN TO THE PIA BOARD.

For a discussion of the potential interests that certain officers of PIA
may have with respect to the Share/ Option Issuance and the Merger that are
different from, or in addition to, the interests of stockholders of PIA
generally, see "Proposal I: The Share/Option Issuance -- Interests of Certain
Persons in the Merger." Such interests, together with other relevant factors,
including the financial analysis contained in the opinion of ING Barings which
is attached as Annex D, were considered by the PIA Board in making its
recommendation.

VOTING RIGHTS; VOTES REQUIRED FOR APPROVAL; QUORUM

The PIA Board has fixed the close of business on June 7, 1999, as the
Record Date for voting at the Annual Meeting. Only holders of record of shares
of PIA Common Stock on the Record Date are entitled to notice of and to vote at
the Annual Meeting. On the Record Date, there were 5,480,966 shares of PIA
Common Stock outstanding and entitled to vote at the Annual Meeting, held by
approximately 870 stockholders of record. Each holder of record of PIA Common
Stock, as of the Record Date, is entitled to cast one vote per share. The
presence, in person or by proxy, of the holders of a majority of the outstanding
shares of PIA

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Common Stock at the Annual Meeting shall constitute a quorum at the Annual
Meeting. In the event that a quorum is not present at the Annual Meeting, it is
expected that such meeting will be adjourned or postponed to solicit additional
proxies.

As of the Record Date, PIA's directors, executive officers and their
affiliates beneficially owned shares of PIA Common Stock representing
approximately 44.3% of the outstanding PIA Common Stock. Pursuant to the terms
of a voting agreement (the "Voting Agreement") executed in connection with the
Merger, each of Mr. Owens, a director of PIA, and RVM/PIA, a California limited
partnership have agreed to vote all their shares of PIA Common Stock, which
represents an aggregate of approximately of 40.7% of the outstanding PIA Common
Stock as of the Record Date, in favor of the Share/Option Issuance, each of the
Pre-Merger Charter Amendments, the Reverse Split Proposal and the Option Plan
Amendment. In addition, each of PIA's executive officers and other directors and
their affiliates intend to vote their shares of PIA Common Stock beneficially
owned by them for approval of each of the Pre-Merger Charter Amendments, the
Share/ Option Issuance, the Reverse Split Proposal and the Option Plan
Amendment. The SPAR Principals have also executed the Voting Agreement and
agreed to vote their shares of SAI in favor of the Merger.

Approval of each of the Pre-Merger Charter Amendments and the Reverse Split
Proposal requires the affirmative vote of a majority of the outstanding shares
of PIA Common Stock entitled to vote thereon at the Annual Meeting. Approval of
each of the Share/Option Issuance and the Option Plan Amendment requires the
affirmative vote of a majority of the votes cast with respect to each such
proposal. Approval of each of the Merger Proposals is required for the Merger to
be consummated. Unless all six Merger Proposals are approved, the Merger cannot
be consummated and none of the six proposals will be approved. The director
nominees that receive the greatest number of votes at the Annual Meeting will be
elected to serve on the PIA Board until such time as the Merger may be
consummated, or if the Merger is not consummated, until such time as their
successors are duly elected and qualified.

SHARE OWNERSHIP OF MANAGEMENT

At the close of business on the Record Date, PIA's directors, executive
officers and their affiliates, as a group, were the beneficial owners of an
aggregate of approximately 2,636,699 shares (approximately 44.3%) of the PIA
Common Stock then outstanding.

PROXIES

All shares of PIA Common Stock represented by properly executed proxies
received prior to or at the Annual Meeting and not revoked will be voted in
accordance with the instructions indicated in such proxies. If no instructions
are indicated on a properly executed returned proxy, such proxy will be voted
FOR the approval of the PIA Proposals. A properly executed proxy marked
"ABSTAIN" will not be voted, although it will be counted for purposes of
determining whether there is a quorum and for purposes of determining the
aggregate voting power and number of shares represented and entitled to vote at
the Annual Meeting. Therefore, abstentions are treated as votes cast against a
PIA Proposal except in the case of election of directors where abstentions have
no legal effect. The affirmative vote of a majority of the shares of PIA Common
Stock outstanding as of the Record Date on each of the Pre-Merger Charter
Amendments and the Reverse Split Proposal is required to approve such proposals.
The affirmative vote of a majority of the votes cast with respect to the
Share/Option Issuance and the Option Plan Amendment is required to approve such
proposals. The director nominees who receive the greatest number of votes at the
Annual Meeting will be elected to the PIA Board. Votes against a candidate and
votes withheld have no legal effect. Therefore, a "broker non-vote" (i.e.,
shares held by brokers or nominees which are represented at a meeting but with
respect to which the broker or nominee is not empowered to vote on a particular
proposal) will not be counted as a vote cast on any of the PIA proposals. Shares
represented by "broker non-votes" will, however, be counted in determining
whether there is a quorum at the Annual Meeting.

The PIA Board is not currently aware of any business to be acted upon at
the Annual Meeting other than as described herein. If, however, other matters
are properly brought before the Annual Meeting, or any adjournments or
postponements thereof, the persons appointed as proxies will have discretion to
vote or act

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thereon according to their judgment. Such adjournments may be for the purpose of
soliciting additional proxies in the absence of a quorum at the Annual Meeting.

A stockholder may revoke his or her proxy at any time prior to its use by
delivering to the Secretary of PIA, an instrument revoking it, by delivering a
duly executed proxy bearing a later date or by attending the Annual Meeting and
voting in person. Attendance at the Annual Meeting will not in itself constitute
the revocation of a proxy.

The cost of the solicitation of proxies will be paid by PIA. In addition to
solicitation by mail, arrangements will be made with brokerage houses and other
custodians, nominees and fiduciaries to send proxy materials to beneficial
owners, and PIA will, upon request, reimburse them for their reasonable
expenses. To the extent necessary in order to ensure sufficient representation
at the Annual Meeting, PIA, through its officers and regular employees, who will
receive no compensation in excess of their regular salaries for their services,
may request by telephone or telegram the return of proxy cards. The extent to
which this will be necessary depends entirely upon how promptly proxy cards are
returned. Stockholders are urged to send in their proxies without delay.

PIA STOCKHOLDERS DO NOT NEED TO TAKE ANY ACTION WITH RESPECT TO THEIR STOCK
CERTIFICATES, WHICH WILL CONTINUE TO EVIDENCE THE SAME NUMBER OF SHARES OF PIA
COMMON STOCK FOLLOWING THE MERGER.

PROPOSAL I: SHARE/OPTION ISSUANCE

The following is a brief summary of certain aspects of the Share/Option
Issuance, the Merger Agreement and the Merger contemplated thereby. This summary
does not purport to be complete and is qualified in its entirety by reference to
the Merger Agreement, attached hereto as Annex A and incorporated herein by
reference. Stockholders of PIA are urged to read the Merger Agreement in its
entirety.

THE SHARE/OPTION ISSUANCE

The Share/Option Issuance contemplates the issuance by PIA of approximately
12.7 million shares of PIA Common Stock in exchange for all of the outstanding
SAI Common Stock and the issuance of Substitute Options to purchase an aggregate
of 134,114 shares of PIA Common Stock to the holders of SAI Options under the
Merger Agreement, pursuant to which PIA Acquisition will merge with and into
SAI. Based on the number of shares of PIA Common Stock outstanding on June 7,
1999 (5,480,966 outstanding shares), upon the consummation of the Merger, PIA
will issue an aggregate of approximately 12,654,806 shares of PIA Common Stock
to the SAI Stockholders and Substitute Options covering an aggregate of 134,114
shares of PIA Common Stock to the holders of SAI Options. Such shares of PIA
Common Stock would have a value of approximately $45.1 million and the
Substitute Options (assuming full exercise thereof and without regard to
vesting) would have a value of approximately $480,000, based upon the closing
price of PIA Common Stock as reported on the Nasdaq National Market on June 7,
1999. Following the Merger, SAI will become the Surviving Corporation and a
wholly owned subsidiary of PIA and PIA Acquisition will cease to exist. Although
the DGCL does not require that the stockholders of PIA approve the Share/Option
Issuance, under the rules of the Nasdaq Stock Market, PIA must obtain
stockholder approval prior to the issuance of the Merger Consideration.

GENERAL EFFECT ON RIGHTS OF EXISTING PIA STOCKHOLDERS

Under Delaware law, the Merger Shares will have rights and privileges
identical to those of the currently outstanding PIA Common Stock. The Merger
Shares will be subject, however, to resale restrictions imposed by the
Securities Act of 1933, as amended (the "Securities Act"). The issuance of the
Merger Shares will have no effect on the rights and privileges of the
outstanding PIA Common Stock except for effects incidental to increasing the
number of shares of PIA Common Stock outstanding after the Merger such as a
reduction in voting power and a possible material reduction in their interest in
PIA with respect to earnings per share, liquidation and book and market value
per share in connection with the Merger.

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EFFECTIVE TIME

The Merger will become effective upon the filing of the Articles of Merger
with the Nevada Secretary of State. It is expected that such filing will take
place no later than two business days after the approval by the PIA stockholders
of the Share/Option Issuance, each of the Pre-Merger Charter Amendments, the
Reverse Split Proposal and the Option Plan Amendment and the satisfaction or
waiver of the other conditions to the Merger, including obtaining necessary
regulatory approvals. On June 21, 1999, PIA received confirmation of the early
termination of all applicable waiting periods under the HSR Act with respect to
the Merger. The time of the filing of the Articles of Merger (or such later time
as may be specified for effectiveness of the Merger in the Articles of Merger)
is referred to as the Effective Time.

BACKGROUND OF THE MERGER

The terms of the Merger Agreement are the result of arm's length
negotiations between executive officers and representatives of PIA and SPAR. The
following is a brief description of the background of these negotiations and the
Merger.

Initiation of discussions between PIA and SPAR was principally a result of
PIA management's efforts to maximize stockholder value. During fiscal 1997 PIA
experienced net losses in each quarter, with an aggregate net loss of $15.1
million for the year. This resulted primarily from the loss of shared clients
which resulted in margin reductions, higher overhead costs as a percentage of
revenue and, in addition, inefficiencies in field labor execution. During 1998,
PIA scaled back its operations, reduced administrative costs, laid-off employees
and closed several offices. Despite these efforts, PIA continued to incur net
losses in 1998. Because PIA's revenues did not support its cost structure, PIA
determined that the best way to continue to provide the same level of service
that its customers demand and maximize stockholder value was to achieve cost
savings and other synergies through a consolidation of PIA with a suitable
candidate. In order to implement this strategy, in the third quarter of 1998,
PIA's management retained the services of ING Barings to advise PIA on possible
transactions through which PIA could engage in potential acquisition
transactions, such as a merger or sale of the company.

On September 16, 1998, following a special meeting of the PIA Board,
representatives of ING Barings made an informal presentation to the PIA Board
concerning PIA's strategic alternatives. The PIA Board instructed
representatives of ING Barings and PIA management to generate a list of
potential strategic partners. Seventeen potential candidates were subsequently
identified and ING Barings as well as Mr. Peets, Chief Executive Officer of PIA,
made informal contact with all 17 potential candidates regarding a business
combination with PIA. Out of such 17 candidates, nine entered into
confidentiality agreements with PIA.

On September 30, 1998, at a special meeting of the PIA Board,
representatives of ING Barings summarized the strategic alternatives discussed
at the informal presentation following the September 16, 1998 Board meeting, and
reviewed the various strategic alternatives available to PIA. The PIA Board
acknowledged that some of the possible alternatives would include a sale of the
company or a majority interest in the company. ING Barings and PIA management
reported on their discussions with the potential candidates. The PIA Board
authorized PIA management to continue negotiating with potential candidates.

On October 1, 1998, Mr. Peets and Cathy Wood, Chief Financial Officer of
PIA, met with Mr. Brown, Chief Executive Officer and co-founder of SPAR, and Mr.
Bartels, Senior Vice President and co-founder of SPAR, in ING Barings' office in
San Francisco. Mr. Peets provided Messrs. Brown and Bartels information
regarding PIA's business, service offerings, markets, financials and management.

On October 28, 1998, at a regular meeting of the PIA Board, Mr. Peets and
representatives of ING Barings reviewed the status of discussions held between
PIA management and other potential strategic partners (including SPAR) and
management's continuing efforts to identify other candidates regarding a
possible business combination with PIA. The PIA Board authorized ING Barings to
continue its analysis of, and its discussions with, SPAR and any other possible
strategic partners and acquirors.

On November 3, 1998, Mr. Peets, Ms. Wood, John Colwell, a director of PIA,
and representatives of ING Barings met with Messrs. Brown and Bartels and James
H. Ross, Chief Financial Officer of SPAR, at ING Barings office in New York. At
the meeting, PIA representatives obtained information regarding SPAR's business,
service offerings, markets, profitability and management for presentation to the
PIA Board.
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Messrs. Brown and Bartels also informed Mr. Peets and Ms. Wood that SPAR was
negotiating with MCI to acquire its assets. The parties also discussed the
operating philosophies of the two companies and possible synergies and benefits
of a merger of PIA and SPAR. PIA also provided SPAR with additional information
regarding PIA.

On November 19, 1998, Mr. Peets, Ms. Wood and representatives of ING
Barings and Riordan & McKinzie, PIA's legal counsel, met with Mr. Brown in Las
Vegas. At the meeting, the parties negotiated preliminary terms of a proposed
transaction and discussed the financial structure for such a transaction. Mr.
Brown indicated to Mr. Peets that the acquisition of MCI would probably occur
prior to any proposed business combination between SPAR and PIA. During these
discussions, Mr. Peets negotiated a business combination that would result in
the SPAR stockholders owning between 69% and 70% of the combined companies and
PIA's stockholders owning between 30% and 31% of the combined companies. This
ratio was based on MCI being acquired prior to any combination of PIA and SPAR.
As part of the financial structure, Messrs. Peets and Brown also discussed PIA
granting options to SPAR employees. The parties agreed to proceed with further
negotiations, subject to further due diligence and PIA Board approval.

On November 25, 1998, at a special PIA Board meeting with representatives
from ING Barings and Riordan & McKinzie, Mr. Peets apprised the PIA Board of the
discussions between PIA and SPAR. Mr. Peets provided the PIA Board with
background information regarding SPAR's business, products, markets, financial
situation and management. The PIA Board also reviewed the results of the
discussions Mr. Peets and representatives of ING Barings had engaged in with
other companies regarding a possible business combination with PIA. The PIA
Board also discussed the general terms for the transaction that Messrs. Peets
and Brown had discussed in Las Vegas during the previous week. Following these
discussions, the PIA Board authorized the officers of PIA to conduct a thorough
due diligence investigation regarding SPAR and to negotiate the terms of a
definitive merger agreement, subject to PIA Board approval. The PIA Board also
authorized its officers to continue negotiations with other interested parties
until the execution of a definitive agreement with SPAR.

On December 7, 1998, and December 8, 1998, representatives from ING Barings
and Riordan & McKinzie and PIA's accountants met with Mr. Ross and James
Segreto, Controller for SPAR and representatives from SPAR's legal counsel,
Parker Chapin Flattau & Klimpl, LLP ("Parker Chapin"), at SPAR's corporate
offices in New York at which the management of SPAR made a series of
presentations regarding SPAR. On-site financial and legal due diligence related
to SPAR, including a review of SPAR's accounting and legal papers, was conducted
by PIA and its legal, financial and accounting representatives.

On December 9, 1998, representatives from ING Barings and Riordan &
McKinzie and PIA's accountants met with John H. Wile, founder of MCI, Mark A.
Whitney, Chief Executive Officer of MCI, Gary W. Oakley, intended President of
SPAR Incentive, and Edward Loos, Chief Financial Officer of MCI at MCI's offices
in Dallas. The meeting focused on financial and legal due diligence related to
MCI and included a review of MCI's accounting and legal papers. Subsequently,
PIA's legal, financial and accounting representatives reported the results of
its due diligence investigation to PIA management.

On December 9, 1998, and December 10, 1998, Messrs. Ross and Segreto met
Ms. Wood at Riordan & McKinzie's office in Costa Mesa, California, together with
representatives of Ernst & Young LLP, and Messrs. Ross and Segreto conducted
certain financial due diligence review of PIA.

On December 14, 1998 and December 15, 1998, Mr. Peets, Ms. Wood, Mr.
Colwell, John Bain, Executive Vice President, Operations of PIA, Larry Dorr,
Senior Vice President, Operations of PIA, Don Holman, Executive Vice President,
Sales and Marketing of PIA and a representative from ING Barings met with
representatives from SPAR. The parties discussed potential synergies of a
business combination as well as customer information, financial information and
proposed integration plans.

On January 6, 1999, Mr. Peets met with Mr. Brown in Dallas. The parties
discussed the number of PIA options to be granted to SPAR employees in
connection with the business combination.

On January 14, 1999, at a special meeting with Ms. Wood and representatives
from ING Barings and Riordan & McKinzie also present, the PIA Board reviewed the
status of the discussions with SPAR and two potential strategic partners that
had recently expressed interest in PIA. A representative from ING Barings
identified certain key issues that were still unresolved. A representative from
Riordan & McKinzie described
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the proposed structure of the merger and described several important provisions
in the proposed merger agreement. Mr. Peets then described the status of
discussions with two other potential strategic partners. The PIA Board directed
Mr. Peets to pursue discussions with the two parties and SPAR. Preliminary
discussions were subsequently held with the two parties but such parties
expressed no further interest and made no offers.

On January 23, 1999, Mr. Peets and representatives from ING Barings and
Riordan & McKinzie met with Messrs. Brown, Bartels, and Ross and representatives
of Parker Chapin at Parker Chapin's offices in New York. The parties continued
to negotiate the terms of the merger agreement.

On February 9, 1999, Mr. Peets, Ms. Wood and representatives from ING
Barings met with Mr. Brown at Riordan & McKinzie's office in Costa Mesa to
continue to finalize the terms of the merger agreement, which included
discussions regarding the number of PIA options to be granted to SPAR employees
and the closing net worth of SPAR.

On February 11, 1999, the PIA Board met in a special meeting to discuss the
proposed transaction with Ms. Wood and representatives of ING Barings and
Riordan & McKinzie also present. Mr. Peets provided the PIA Board with an
overview of SPAR's business and the results of PIA's due diligence. A
representative from ING Barings reviewed for the PIA Board the activities
undertaken by PIA and ING Barings over the past several months to identify
potential strategic opportunities for PIA and informed the PIA Board that all
discussions with third parties had been terminated other than the ongoing
negotiations with SPAR. He also described the recent acquisition by SMCI of the
assets of MCI, and reviewed certain material features of the proposed
combination with SPAR, including a discussion of PIA option grants to be made in
connection with the transaction. Mr. Peets led the PIA Board in a discussion of
the merits and risks of the proposed transaction. PIA's legal counsel discussed
a number of legal matters and described the legal structure of the transaction
including the principal terms of the legal documents to effectuate the proposed
transaction.

On February 18, 1999, Mr. Peets and Mr. Holman met with Mr. Brown at SPAR's
offices in Minneapolis. The parties discussed synergies and integration plans.

On February 25, 1999 at a special telephonic meeting of the PIA Board,
which included Ms. Wood and representatives of Riordan & McKinzie and ING
Barings, Mr. Peets summarized the status of the discussions with SPAR. A
representative of Riordan & McKinzie reviewed the fiduciary duties of the PIA
Board in considering the merger and several provisions of the merger agreement,
and related documents, draft copies of which had been delivered to all PIA Board
members. In addition, representatives of ING Barings made a presentation to the
PIA Board which included its detailed financial analysis and other information
with respect to the companies, and indicated that it would be in a position to
render its opinion that the proposed Initial Exchange Ratio was fair to the PIA
stockholders from a financial point of view upon completion of the negotiations
with SPAR, subject to a review of the final merger agreement. The PIA Board
authorized PIA's officers to continue the negotiations with SPAR and scheduled a
PIA Board meeting for February 28, 1999 to review any further changes to the
Merger Agreement, to receive the final ING Barings fairness opinion and to
provide final authorization for the transaction.

On the morning of February 28, 1999, the PIA Board met at a special
telephonic meeting which included Ms. Wood and representatives of Riordan &
McKinzie and ING Barings. Mr. Peets informed the PIA Board that the negotiations
concerning the proposed combination of PIA with the SPAR Companies were
substantially concluded, and that the Merger Agreement and related agreements
were being prepared for signature. Representatives of Riordan & McKinzie
reviewed for the PIA Board the issues that had been resolved in the negotiations
since the February 25, 1999 Board meeting and answered questions from the PIA
Board. Representatives of ING Barings confirmed that they had reviewed the final
draft of the Merger Agreement and the related agreements, copies of which had
been provided to the PIA Board members. After answering questions from the PIA
Board, representatives from ING Barings indicated that ING Barings was prepared
to deliver its written opinion to the PIA Board dated February 28, 1999, to the
effect that, as of such date, the Initial Exchange Ratio was fair from a
financial point of view to PIA's stockholders. The PIA Board then unanimously
approved the Merger Agreement and the transactions contemplated thereby. PIA
then received ING Barings' oral opinion, PIA executed the Merger Agreement and
ING Barings subsequently confirmed its oral opinion in writing. In addition, Mr.
Owens and RVM/PIA, a California limited partnership, executed the Voting
Agreement.

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Execution of the Merger Agreement was announced on March 1, 1999, by
issuance of a joint press release.

During early May 1999, Mr. Brown and Mr. Peets discussed PIA's results of
operations for the first quarter of 1999. The parties noted that PIA incurred a
net loss of $3.3 million for the three months ended April 2, 1999. In an effort
to assure that the Combined Company has sufficient cash upon the consummation of
the Merger, Mr. Peets and Mr. Brown discussed ways in which the Combined Company
could retain more cash for operations. Those discussions led to the eventual
amendment of the Merger Agreement to increase the consolidated net worth of SPAR
required under the agreement from $500,000 to $1,436,000 (with the consolidated
net worth calculated in each case after giving effect to the exclusion of
certain charges and other costs as set forth in the Merger Agreement). In
connection with the increase in net worth, the parties negotiated a proposed
increase in the percentage of shares of PIA Common Stock to be issued to the SAI
Stockholders and the holders of Substituted Options (assuming full exercise
thereof) in the Merger from 69.3% to 70% (2 1/3 times the number of shares of
PIA Common Stock outstanding representing an aggregate of approximately 12.8
million shares of PIA Common Stock based on the number of shares of PIA Common
Stock outstanding as of June 7, 1999).

Members of the PIA Board reviewed PIA's quarterly financial statements for
the quarter ended April 2, 1999, PIA's working capital position and other
results of PIA's operations. Although the proposed amendment would result in
additional dilution to PIA stockholders, the increase in over $.9 million in the
net worth of the Combined Company would benefit its working capital position.
The PIA Board determined by unanimous written consent dated as of May 14, 1999
that PIA should enter into an amendment to the Merger Agreement to increase the
consolidated net worth required of SPAR thereunder from $500,000 to 1,436,000
(subject in each case to the exclusion of certain charges and other costs as set
forth in the Merger Agreement) and to increase the percentage of shares of PIA
Common Stock to be issued to the SAI Stockholders and the holders of Substitute
Options (assuming full exercise thereof) in the Merger from 69.3% to 70% (2 1/3
times the number of outstanding shares of PIA Common Stock).

The PIA Board determined the amendment to the Merger Agreement would not
materially affect the fairness of the Merger to PIA and its stockholders from a
financial point of view and that consequently, it was not necessary to obtain an
updated fairness opinion from ING Barings. The PIA Board also determined that
the Merger, on the amended terms, is fair to PIA and its stockholders.

PIA and SPAR then executed an amendment to the Merger Agreement which
increased the consolidated net worth of SPAR required therewith from $500,000 to
1,436,000 (subject in each case to the exclusion of certain charges and other
costs as set forth in the Merger Agreement) and increased the percentage of
shares of PIA Common Stock to be issued to the SAI Stockholders and the holders
of Substitute Options (assuming full exercise thereof) in the Merger from 69.3%
to 70% (2 1/3 times the number of outstanding shares of PIA Common Stock).

PIA'S REASONS FOR THE MERGER

The PIA Board believes that the Merger and the Share/Option Issuance are in
the best interest of PIA and PIA's stockholders. Accordingly, the PIA Board has
unanimously approved the Merger and the Share/ Option Issuance.

POTENTIAL BENEFITS FROM THE MERGER

In reaching its decision, the PIA Board consulted with PIA management as
well as its financial and legal advisors, and considered a number of factors,
including, without limitation, the following:

(i) The significant opportunity for PIA stockholders to own shares in
a larger company with improved financial strength and flexibility.

(ii) Ownership in the Combined Company will allow PIA stockholders to
participate in the long-term growth and appreciation that may result from
the Combined Company's future participation in the consolidation of the
marketing services industry and from the Combined Company's more
diversified product offerings.

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(iii) SPAR's sophisticated Internet-based technology will allow PIA to
dramatically improve its technological capabilities and infrastructure for
collecting and distributing store level information to customers and
managing the activities in its field force.

(iv) The opportunity for PIA to become a broad-based marketing
services company instead of remaining a single-service company.

(v) The strategic fit between PIA and SPAR and the complementary
nature of their respective businesses and similar customer base which could
strengthen existing, and develop new, customer relationships through the
marketing capabilities of the Combined Company.

(vi) Anticipated significant operating synergies, cost savings and
other operating efficiencies including those with respect to reduced field
costs and administrative expenses resulting from the consolidation of
sales, corporate, administrative and support functions. "Operating
synergies" refer to PIA's belief that when PIA and SPAR are merged, the
Combined Company will produce total results that are greater than the sum
of each company's individual contributions.

(vii) Information with respect to the business, operations, financial
condition, earnings and prospects of SPAR, on an historical and a
prospective basis.

(viii) The tax-free nature of the Merger.

(ix) The financial analysis provided by ING Barings and ING Barings'
opinion that the Initial Exchange Ratio is fair, from a financial point of
view, to the PIA stockholders.

(x) The terms of the Merger Agreement which permit PIA, under certain
limited circumstances, to negotiate with third parties and to accept more
favorable proposals, if any are received.

In the course of its deliberations, the PIA Board reviewed, among other
things, the following information relevant to the Merger: (a) the financial
presentation and analysis of ING Barings prepared in connection with its
fairness opinion; (b) reports from PIA's management and legal advisers on
specific terms of the Merger Agreement; (c) reports from PIA management
regarding the financial performance, conditions, business operations and
prospects of SPAR; and (d) the proposed terms, timing and structure of the
Merger and the final form of the Merger Agreement.

The PIA Board believes that merging the PIA Companies and SPAR Companies
will create a more efficient Combined Company capable of achieving greater cost
savings, a broader customer base and more positive operating results than either
company could achieve on its own. The synergistic benefits of the Merger were
estimated by applying SPAR's proprietary labor cost, deployment and
organizational structure models to PIA. Such models were based on the following
assumptions: (i) selected SPAR expenses to revenue percentages as of December
31, 1998 could be applied to PIA's revenue to derive expected savings estimates
for these expense categories and (ii) the Merger would be consummated on or
about June 30, 1999. Based on these assumptions, PIA expects savings during 1999
of approximately $.4 million from volume discounts for telecommunications
services, approximately $1.2 million from reduced travel related expenses due to
the larger pool of employees located in more geographic regions, approximately
$.7 million from centralized recruiting and salary and benefit expense
management, and approximately $1.1 million by eliminating redundant equipment
and facilities and approximately $1.8 million from streamlining PIA field
management through the use of SPAR's Internet based and other technology. The
PIA Board believes that all of the factors listed above, as well as the opinion
of ING Barings, support the fairness of the Merger and the Share/Option Issuance
to PIA and its stockholders and that the Merger and the Share/Option Issuance
are in the best interests of PIA and its stockholders.

POTENTIAL NEGATIVE FACTORS ASSOCIATED WITH THE MERGER

The PIA Board also considered the following potentially negative factors in
its deliberation concerning the Merger:

(a) The risk that some, if not all, of the potential benefits of the
Merger will not be fully realized.

(b) The risks and costs associated with integrating the businesses and
operations of PIA and SPAR.

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(c) The possibility that the Merger may not be consummated resulting
in significant accrued transaction costs.

(d) The potentially adverse effects of the announcement of the Merger,
or its failure to be consummated, on PIA's customers and employees.

(e) Dilution of the voting power of PIA stockholders and the potential
reduction in book value of PIA Common Stock.

The foregoing discussion of information and factors considered by the PIA
Board is not intended to be exhaustive. While the PIA Board did not assign
relative weight to the specific factors considered, it did believe that the
opportunity to improve PIA's financial strength, combined with the potential
cost savings and the technological capabilities gained through the use of SPAR's
Internet-based technology, were the most significant factors in determining that
the positive factors outweighed any potentially negative factors in connection
with the transaction.

THE PIA BOARD BELIEVES THAT THE TERMS OF THE MERGER AND THE SHARE/OPTION
ISSUANCE ARE FAIR TO, AND IN THE BEST INTERESTS OF, PIA AND THE HOLDERS OF PIA
COMMON STOCK. ACCORDINGLY, THE PIA BOARD HAS APPROVED THE MERGER AGREEMENT, THE
SHARE/OPTION ISSUANCE AND THE TRANSACTIONS CONTEMPLATED THEREBY AND APPROVED THE
MERGER. THE PIA BOARD RECOMMENDS TO THE HOLDERS OF PIA COMMON STOCK THAT THEY
VOTE FOR THE SHARE/OPTION ISSUANCE AND THE APPROVAL OF THE TRANSACTIONS
CONTEMPLATED THEREBY. SEE "-- INTERESTS OF CERTAIN PERSONS IN THE MERGER."

SPAR'S REASONS FOR THE MERGER

SPAR has concluded that the Merger offers the SPAR Companies and their
respective stockholders a significant opportunity to create a combined
organization that will be:

(i) significantly larger than either PIA or the SPAR Companies alone,
with more trained and experienced field managers and a much larger field
force and improved efficiency,

(ii) better able to be (and remain) competitive in its pricing and
services in an increasingly competitive industry, through increased use of
Internet and other technological efficiencies, and through increased
leverage over suppliers and other cost controls, and

(iii) strategically positioned to become a leading provider of
in-store merchandising and other outsourced marketing services, and
differentiated marketing and sales solutions through a single point of
contact.

The Merger could provide the Combined Company with immediate access to
additional financial resources, including public stock that can be used as
currency to accelerate its growth and implement its acquisition strategy, as
well as provide access to the public markets for further capital, if necessary.

SPAR believes that the Combined Company can grow and become a leading
provider of in-store merchandising and other outsourced marketing services
through the acquisition and consolidation of other marketing, merchandising and
incentive companies and related providers in other sectors of this industry,
such as ad specialty (using free promotional items to stimulate corporate
remembrance), direct marketing (marketing to or soliciting orders from consumers
via mail and telephone), database marketing (direct marketing using lists
developed by marketers with proprietary data), sales promotions (marketing
activities to encourage purchases in support of or in lieu of advertising),
information/research (collecting and reselling data on consumers and consumer
preferences), sampling (distributing free product to consumers to promote
awareness) and demonstrations (live exhibitions, typically in-store, of how a
product works).

STRATEGY OF THE COMBINED COMPANY AFTER THE MERGER

MARKETING SERVICES INDUSTRY OVERVIEW

According to industry sources such as PROMO Magazine, Brand Marketing and
Advertising Age, in 1997, the marketing services industry generated over $79
billion in revenue. Merchandising services represented approximately $13.5
billion of the market, of which approximately $1.3 billion was outsourced to

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third-party retail merchandising businesses. The premium incentive market, which
includes merchandise fulfillment and travel fulfillment companies, generated
over $20.0 billion in revenues.

PIA and SPAR believe, based on industry sources and the collective
experience of its management, that the highly fragmented nature of the marketing
services industry, together with the consolidation of retailers and
manufacturers, is driving the growth and consolidation of the industry. This
consolidation has created retailers which are larger, have broader geographic
reach, and more centralized procurement and administration functions than many
mid-size retailers. As a result, many retailers and manufacturers have started
to choose third-party marketing service providers with broader capabilities in
order to achieve consistent and simultaneous execution of certain of their
retail marketing strategies across a larger geographic area and to customize the
scope of certain other services performed on their behalf. In addition, PIA and
SPAR believe that the increasing use of information technology by retailers and
manufacturers for inventory control, product shelf placement and off-shelf
displays, will create demand for third-party expertise in the selection,
deployment and management of such technologies.

Merchandising. PIA and SPAR believe that merchandising services bring added
value to retailers, manufacturers and other businesses. Retail merchandising
services enhance sales by making a product more visible and available to
consumers. These services primarily include shelf maintenance, display
placement, reconfiguring product on store shelves, replenishing product and
placing orders and other services such as test market research, mystery
shopping, teleservices, database marketing and promotion planning and analysis.

Merchandising services previously undertaken by retailers, manufacturers
and independent brokers have been increasingly outsourced to third parties.
Historically, retailers staffed their stores as needed to ensure inventory
levels, the advantageous display of new items on shelves, and the maintenance of
shelf schematics. Manufacturers deployed their own sales representatives to
ensure that their products were displayed on the shelves and were properly
spaced and positioned. Independent brokers performed similar services on behalf
of the manufacturers they represented. In an effort to improve their margins,
retailers are increasing their reliance on manufacturers and brokers to perform
such services. Initially, manufacturers attempted to satisfy their needs for
merchandising services in retail stores by utilizing their own sales
representatives. Manufacturers discovered that using its own sales
representatives for this purpose was expensive and inefficient, however, and
outsourced their needs for merchandising services to third parties capable of
operating at a lower cost by serving multiple manufacturers simultaneously.

Another significant trend impacting the merchandising segment is a
significant tendency of consumers to make product purchase decisions once inside
the store. Accordingly, merchandising services and in-store product promotions
have proliferated and diversified. Retailers are continually re-merchandising
and remodeling entire stores to respond to new product developments and changes
in consumer preferences. PIA and SPAR estimate that these activities have
doubled in frequency over the last five years, such that most stores are
re-merchandised and remodeled every twenty-four months. Both retailers and
manufacturers are seeking third parties to help them meet the increased demand
for these labor-intensive services.

Premium Incentive. SPAR believes that American companies are increasingly
using third party incentive providers as a more efficient and cost effective
means to increase the productivity of their employees. Third party incentive
premium providers can offer a customized, unique turnkey solution specifically
tailored to a company's needs. Additionally, incentive premium providers are
able to capitalize on supplier relationships and to realize volume discounts,
particularly on travel and merchandise.

Premium incentives are performance-determined rewards used to motivate
employees, salespeople, dealers and consumers, as well as to differentiate a
product, service or store. According to the Incentive Federation Survey, only
26.0% of American businesses are using premium incentives to motivate employees
and that the majority of these businesses are large companies (with over 1,000
employees). SPAR anticipates that this market segment will grow as additional
companies realize the value of using incentives to motivate employees, sales
forces and consumers.

The three most commonly used incentives are cash, travel and merchandise.
While consumer promotions, including direct premium offers (using travel or
merchandise in conjunction with a purchase of a product or service), sweepstakes
(promotions that require only chance to win) and self-liquidating premiums
(offering travel or merchandise premiums to consumers at a price that totally
covers the marketer's costs)

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generate the most attention, most incentive expenditures are for trade
incentives to motivate salespeople to sell and retailers to buy and display
products. Recent trends include the growth of retail certificates or debit or
cash cards in the merchandise fulfillment sector (the segment of the premium
incentive sector concerned with providing merchandise as rewards in incentive
programs), while the travel fulfillment sector (the segment of the premium
incentive sector concerned with providing travel as rewards in incentive
programs) has seen growth in individual travel and meetings involving
registration services (fee-based services used to simplify the process of
signing up individuals to attend a meeting or seminar).

Other Marketing Services Sectors. The other marketing services sectors,
such as ad specialty, point-of-purchase displays, direct marketing, database
marketing, sales promotions, information/research, sampling and demonstrations,
generated over $54 billion in revenues in 1997. PIA and SPAR believe that these
sectors are highly fragmented and represent significant opportunities for
consolidation.

BUSINESS STRATEGY

As the marketing services industry continues to grow and consolidate, large
retailers and manufacturers are increasingly outsourcing their marketing needs
to third-party providers. PIA and SPAR believe that offering marketing services
in multi-use sectors on a national basis will provide PIA and SPAR with a
competitive advantage. Moreover, PIA and SPAR believe that developing a
sophisticated technology infrastructure is key to providing clients with a high
level of customer service. PIA and SPAR's objective is to become such a national
integrated provider by pursuing both an operating and acquisition- driven
strategy, as described below.

OPERATING STRATEGY POST MERGER

Capitalize on Cross-Selling Opportunities. PIA and SPAR intend to leverage
their current client relationships by cross-selling the range of services
offered by the Divisions after the Merger. For example, PIA and SPAR believe
that their retail merchandising and database marketing services can be packaged
with their premium incentive services to provide a high level of customer
services, and that additional cross-selling opportunities will increase if, as
management intends, the Combined Company acquires businesses in other sectors of
the marketing services industry.

Achieve Operating Efficiencies. PIA and SPAR intend to achieve operating
efficiencies within the Divisions. For example, as new businesses are acquired
within the SPAR Merchandising Division, PIA and SPAR believe their existing
field force and technology infrastructure can support additional customers and
revenue. In the SPAR Incentive Division, PIA and SPAR believe they can similarly
realize volume purchasing advantages with respect to travel and merchandise
fulfillment. At the corporate level, the Combined Company will also seek to
combine certain administrative functions, such as accounting and finance,
insurance, strategic marketing and legal support.

Leverage Divisional Autonomy. PIA and SPAR intend to conduct their
operations on a decentralized basis whereby management of each Division will be
responsible for its day-to-day operations, sales relationships and the
identification of additional acquisition candidates in their respective sectors.
A company-wide team of senior management will provide the Divisions with
strategic oversight and guidance with respect to acquisitions, financing,
marketing, operations and cross-selling opportunities. PIA and SPAR believe that
a decentralized management approach will result in better customer service by
allowing management of each Division the flexibility to implement policies and
make decisions based on the needs of customers. The operational autonomy of the
Divisions will be complemented by equity and other incentive compensation
through which the Combined Company intends to motivate division managers to
focus on company-wide performance.

Implement Technology. PIA and SPAR intend to utilize computer, Internet and
other technology to enhance their efficiency and ability to provide real-time
data to its customers. Industry sources indicate that customers are increasingly
relying on marketing service providers to supply rapid, value-added information
regarding the results of marketing expenditures on sales and profits. The SPAR
Merchandising Division owns proprietary Internet software technology that allows
it to communicate with its field representatives over the Internet, to schedule
its field operations more efficiently, to receive field representative reports
over the Internet and incorporate their data immediately, to quantify the
benefits of its services to customers more
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quickly and to respond to customers' needs and implement programs more rapidly.
PIA and SPAR believe that this technology is a competitive advantage, and that
the PIA Division and SPAR Incentive Division can utilize portions of this
technology to enhance the services they now provide.

ACQUISITION STRATEGY

Acquire Complementary Businesses. PIA and SPAR intend to acquire businesses
across the United States and Canada that offer marketing services in which each
of the Divisions operates to consolidate the sectors of the marketing services
they serve. PIA and SPAR believe that adding geographic breadth and increasing
its presence within geographic regions will allow it to service its clients more
efficiently and cost effectively. As their customers' industries continue to
consolidate, PIA and SPAR believe that national coverage and operational
technology capabilities and efficiencies will become increasingly important.

As part of its acquisition strategy, SPAR is actively exploring and
considering a number of potential acquisition candidates, however, there can be
no assurance that any of the acquisitions will occur or whether, if completed,
the consolidation of the sectors of the marketing services industry will be
successful. Neither PIA nor SPAR has entered into any definitive and binding
arrangements with respect to any contemplated acquisition.

Acquire Strategic New Businesses. PIA and SPAR believe that there are
numerous other attractive sectors within the marketing services industry. PIA
and SPAR plan to acquire strategic new businesses in other marketing services
areas and from new divisions. Some of the areas are ad specialty (using free
promotional items to stimulate corporate remembrance), direct marketing
(marketing to or soliciting orders from consumers via mail and telephone),
database marketing (direct marketing using lists developed by marketers with
proprietary data), sales promotions (marketing activities to encourage purchases
in support of or in lieu of advertising), information/research (collecting and
reselling data on consumers and consumer preferences), sampling (distributing
free product to consumers to promote awareness) and demonstrations (live
exhibitions, typically in-store, of how a product works). By entering any one or
more of these sectors, the Combined Company may realize additional operating and
revenue synergies across the Divisions, and may leverage existing relationships
with manufacturers, retailers and other businesses to create cross-selling
opportunities.

OPINION OF FINANCIAL ADVISOR

The Initial Exchange Ratio referred to by ING Barings in its opinion was
based upon PIA issuing an aggregate of approximately 12.3 million shares of PIA
Common Stock to the SAI Stockholders and the holders of Substitute Options
(assuming full exercise thereof) which represented approximately 69.3% of the
outstanding shares of PIA Common Stock or approximately 2.25 times the number of
shares of PIA Common Stock outstanding on February 28, 1999. References in this
Proxy Statement to the "Initial Exchange Ratio" are to the one-to-one Exchange
Ratio referred to by ING Barings in its opinion, a copy of which is attached
hereto as Annex D, and based upon the Initial SPAR Percentage and Initial SPAR
Multiplier. The Merger Agreement was subsequently amended to increase the
consolidated net worth of SPAR required under the agreement from $500,000 to
$1,436,000 (in each case, after giving effect to the exclusion of certain
charges and other costs as set forth in the Merger Agreement) and an increase in
the percentage of shares of PIA Common Stock to be issued to the SAI
Stockholders and the holders of Substitute Options (assuming full exercise
thereof) in the Merger was made from 69.3% to 70% or 2 1/3 times the number of
shares of PIA Common Stock outstanding which represents an aggregate of
approximately 12.8 million shares of PIA Common Stock (based on the number of
shares of PIA Common Stock outstanding as of June 7, 1999). While the Initial
Exchange Ratio referred to in the ING Barings opinion and the Amended Exchange
Ratio are each one-to-one, the number of shares of PIA Common Stock issuable is
greater with the Amended Exchange Ratio than with the Initial Exchange Ratio,
and, accordingly, the Initial SPAR Percentage is less than the Final SPAR
Percentage, and the Initial SPAR Multiplier is less than the Final SPAR
Multiplier. Therefore, the Initial Exchange Ratio and the Amended Exchange Ratio
are not equivalent. ING BARINGS HAS NOT BEEN RETAINED TO RENDER ANY OPINION ON
THE AMENDED EXCHANGE RATIO. ING BARINGS DISCLAIMS ANY INFERENCE OR IMPLICATION
THAT MAY BE DRAWN OR SUGGESTED THAT THE AMENDED EXCHANGE RATIO IS EQUIVALENT TO
THE INITIAL EXCHANGE RATIO OR THAT THE AMENDED EXCHANGE RATIO IS FAIR FROM A
FINANCIAL POINT OF VIEW OR

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OTHERWISE TO PIA OR ITS STOCKHOLDERS. ING BARINGS HAS NOT BEEN RETAINED TO
REVIEW THE AMENDED EXCHANGE RATIO WITH A VIEW TO RENDERING AN OPINION THEREON.

On February 28, 1999, ING Barings, financial advisor to PIA, delivered its
oral opinion to the PIA Board, which was subsequently confirmed in writing to
the effect that, as of such date, and based upon the assumptions made, matters
considered and limits of review as set forth in such opinion, the Initial
Exchange Ratio is fair to the stockholders of PIA from a financial point of
view. The amount of the Merger Consideration was determined pursuant to
negotiations between PIA and SPAR with recommendations from ING Barings. No
limitations were imposed by PIA on ING Barings and no instructions were given to
ING Barings with respect to the investigations made or procedures followed in
rendering its opinion. References herein to the "ING Barings Opinion" refer to
the written opinion of ING Barings dated as of February 28, 1999. In making its
determination to approve the Merger, the PIA Board relied, among other things,
on the ING Barings Opinion. See "--Background of the Merger" and "--PIA's
Reasons for the Merger."

A COPY OF THE ING BARINGS OPINION, WHICH SETS FORTH THE ASSUMPTIONS MADE,
MATTERS CONSIDERED AND CERTAIN LIMITATIONS ON THE SCOPE OF REVIEW UNDERTAKEN BY
ING BARINGS, IS ATTACHED TO THIS PROXY STATEMENT AS ANNEX D. HOLDERS OF PIA
COMMON STOCK ARE URGED TO READ THE ING BARINGS OPINION IN ITS ENTIRETY. THE ING
BARINGS OPINION IS DIRECTED ONLY TO THE FAIRNESS FROM A FINANCIAL POINT OF VIEW
OF THE INITIAL EXCHANGE RATIO PURSUANT TO THE MERGER. THE ING BARINGS OPINION
DOES NOT ADDRESS THE MERITS OF THE UNDERLYING DECISION OF PIA TO ENGAGE IN THE
MERGER AND DOES NOT CONSTITUTE A RECOMMENDATION TO ANY HOLDER OF PIA COMMON
STOCK AS TO HOW SUCH STOCKHOLDER SHOULD VOTE. THE SUMMARY OF THE ING BARINGS
OPINION SET FORTH IN THIS PROXY STATEMENT IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO THE FULL TEXT OF SUCH OPINION.

In arriving at the ING Barings Opinion, ING Barings, among other things:

- reviewed a draft of the Merger Agreement as of February 27, 1999, by
and between the PIA Parties and the SPAR Companies;

- reviewed drafts of the other Merger Documents, as defined in the
Merger Agreement, as of February 27, 1999;

- reviewed the SPAR Marketing Companies' audited financial statements
for the two fiscal years ended March 31, 1998 and unaudited
financial information for the nine months ended December 31, 1998;

- reviewed the Asset Purchase Agreement (the "MCI Agreement") among
MCI, SMCI and John H. Wile (the sole stockholder of MCI) dated
December 22, 1998, as amended by a First Amendment dated January 15,
1999;

- reviewed MCI's audited financial statements for the two fiscal years
ended December 31, 1997 and unaudited financial statements for the
fiscal year ended December 31, 1998;

- reviewed PIA's Form 10-Ks and related financial information for the
two fiscal years ended December 31, 1997; PIA's Form 10-Q and
related unaudited financial statements for the nine months ended
October 2, 1998 and unaudited financial information for the fiscal
year ended January 1, 1999;

- reviewed certain information, including financial forecasts,
relating to the business, earnings, cash flow, assets, liabilities
and prospects of SPAR and PIA, as well as related cost savings and
expenses expected to result from the Merger furnished to it by SPAR
and PIA, respectively;

- conducted discussions with members of senior management and
representatives of SPAR and PIA concerning their respective
businesses and prospects before and after giving effect to the
Merger;

- reviewed the historical and projected results of SPAR and PIA with
those of certain companies that it deemed relevant;

- compared the proposed financial terms of the Merger with the
financial terms, to the extent publicly available, of certain other
transactions which it deemed to be relevant; and

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- reviewed such other financial studies and analyses and took into
account such other matters as it deemed necessary, including its
assessment of general economic, market and monetary conditions.

In arriving at the ING Barings Opinion, ING Barings assumed and relied on
the accuracy and completeness of all information supplied or otherwise made
available to it or publicly available. With respect to the financial forecast
information furnished to or discussed with it by SPAR and PIA, it has assumed
that such information has been reasonably prepared and reflects the best
currently available estimates and judgment of SPAR's or PIA's management as to
the expected future financial performance of SPAR or PIA, as the case may be.
ING Barings recognized, however, that these internal projections may have been
prepared or reviewed in the context of the proposed merger and therefore could
differ substantially from projections prepared by disinterested third parties
outside of such context. It has assumed that the reserves established on the
books and records of each of PIA and SPAR are adequate to cover any threatened
or pending litigation. ING Barings has also assumed that the deferred payments
due pursuant to the MCI Agreement will be paid in cash. It has not assumed any
responsibility for independently verifying such information nor has it
undertaken an independent evaluation or appraisal of any of the assets or
liabilities of SPAR or PIA or been furnished with any such evaluation or
appraisal. In addition, it has not conducted any physical inspection of the
properties or facilities of SPAR or PIA. It has assumed that the Merger will be
consummated on the terms substantially similar to those set forth in the draft
of the Merger Agreement as of February 27, 1999, and that no adjustment with
respect to the net worth of SPAR will be made, as the amount of such adjustment,
if any, is not presently determinable.

The matters considered by ING Barings in arriving at the ING Barings
Opinion are based on numerous macroeconomic, operating and financial assumptions
with respect to industry performance, general business and economic conditions,
many of which are beyond the control of PIA and SPAR, and involve the
application of complex methodologies and educated judgment. Any estimates
incorporated in the analyses performed by ING Barings are not necessarily
indicative of actual past or future results or values, which may be
significantly more or less favorable than such estimates. Estimated values do
not purport to be appraisals and do not necessarily reflect the prices at which
businesses or companies may be sold in the future, and such estimates are
inherently subject to uncertainty. No public company utilized as a comparison is
identical to PIA or SPAR, and none of the acquisition comparables or other
business combinations utilized as a comparison is identical to the proposed
Merger. Accordingly, an analysis of publicly traded comparable companies and
comparable business combinations is not mathematical; rather it involves complex
considerations and judgments concerning differences in financial and operating
characteristics of the comparable companies and other factors that could affect
the public trading value of the comparable companies or company to which they
are being compared.

The following is a summary of the material portions of the financial and
comparative analyses performed by ING Barings in arriving at the ING Barings
Opinion.

CONTRIBUTION ANALYSIS. ING Barings reviewed and analyzed the pro forma
contribution of each of PIA and SPAR to pro forma combined operational and
financial information as of and for the calendar year 1997, calendar year 1998
and as projected for the calendar year 1999. For purposes of this analysis, ING
Barings used historical and projected operational and financial information for
PIA and for SPAR (pro forma for the MCI Acquisition) as of and for the twelve
months ended December 31, 1997 (excluding a $5.4 million non-recurring
restructuring charge for PIA), 1998 and 1999 provided by management of PIA and
SPAR. ING Barings reviewed the estimated contribution of SPAR and PIA,
respectively, to the calendar years 1997, 1998 and 1999 revenues, gross profit,
earnings before interest, taxes, depreciation and amortization ("EBITDA"),
earnings before interest and taxes ("EBIT"), and net income of the Combined
Company.

This analysis yielded the following contribution by SPAR:

1997         1998         1999
------        -----        -----

Revenues..................................    37.4%        38.1%        49.4%
Gross Profit..............................    76.4%        68.9%        68.9%
EBITDA....................................   100.0%(a)    100.0%(a)     86.0%
EBIT......................................   100.0%(a)    100.0%(a)     89.8%
Net Income................................   100.0%(a)    100.0%(a)     86.5%

---------------
(a) Greater than 100%.

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Based on the Initial Exchange Ratio, the stockholders of SAI and the SAI
Option Holders will own, or have the right to acquire, approximately 69.3% of
the outstanding shares of PIA after the Merger (excluding options to purchase
shares of PIA Common Stock currently outstanding or to be granted upon Closing
of the Merger).

COMPARABLE PUBLIC COMPANIES ANALYSIS. ING Barings compared certain
financial and operating information and ratios for SPAR with corresponding
publicly available financial and operating information and ratios for a group of
publicly traded companies that ING Barings deemed to be relevant. The companies
included the following marketing services companies:

- ADVO Inc.;
- Catalina Marketing Corp.;
- Harte-Hanks, Inc.;
- Snyder Communications, Inc.; and
- Valassis Communications, Inc.

The companies also included the following advertising companies:

- Interpublic Group;
- Omnicom Group; and
- WPP Group PLC.

Collectively, these companies are referred to as the "SPAR Comparable
Companies". These companies were selected, among other reasons, because they
operate in one or more of the market segments in which SPAR operates.

ING Barings analyzed the enterprise value of the companies as a multiple of
each company's respective latest twelve-month ("LTM") revenues, LTM EBITDA and
LTM EBIT, and the equity value of the companies as a multiple of each company's
respective book value, calendar 1998 earnings per share ("1998 EPS"), calendar
1999 earnings per share ("1999 EPS") and calendar 2000 earnings per share ("2000
EPS"), (based on earnings estimates from First Call Earnings Estimates). The
ranges of the enterprise and equity values as a multiple of LTM revenues, LTM
EBITDA, LTM EBIT, book value, 1998 EPS, 1999 EPS and 2000 EPS were as follows:

LOW       HIGH      MEDIAN      MEAN
----      ----      ------      ----

Enterprise Value to:
LTM Revenues..........................   0.60x     5.18x      3.15x      2.92x
LTM EBITDA............................   6.3      23.2       15.1       15.5
LTM EBIT..............................   8.4      28.3       19.4       19.4
Equity Value to:
Book Value............................   3.4      11.4        8.8        8.2
1998 EPS..............................  12.3      39.2       31.6       29.4
1999 EPS..............................  10.8      34.2       25.3       23.9
2000 EPS..............................   9.8      29.4       20.7       20.3

ING Barings then applied the relevant ratios for the SPAR Comparable
Companies to SPAR's financial and operating information and determined an
implied range of equity values for SPAR, which ranged from a high of $102.2
million to a low of $62.2 million. ING Barings noted that these implied equity
values exceeded the equity value implied by the Initial Exchange Ratio pursuant
to the Merger Agreement for the PIA stockholders.

ING Barings also compared certain financial and operating information and
ratios for PIA with corresponding publicly available financial and operating
information and ratios for a group of publicly traded

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companies that ING Barings deemed to be relevant. The companies included the
following marketing services companies:

- ADVO Inc.;
- Catalina Marketing Corp.;
- Harte-Hanks, Inc.
- Snyder Communications, Inc.; and
- Valassis Communications, Inc.

The companies also included the following specialty staffing companies:

- Modis Professional Services; and
- StaffMark, Inc.

Collectively, these companies are referred to as the "PIA Comparable
Companies". These companies were selected, among other reasons, because they
operate in one or more of the market segments in which PIA operates.

ING Barings analyzed the enterprise value of the companies as a multiple of
each company's estimated LTM revenues, LTM EBITDA, LTM EBIT, projected 1999
revenues, projected 1999 EBITDA, and projected 1999 EBIT (based on estimates
from publicly available equity research), and the equity value of the companies
as a multiple of each company's respective book value, calendar 1998 EPS,
calendar 1999 EPS and calendar 2000 EPS (based on earnings estimates from First
Call Earnings Estimates). The ranges of the enterprise and equity values as a
multiple of LTM revenues, LTM EBITDA, LTM EBIT, book value, projected 1999
revenues, projected 1999 EBITDA, projected 1999 EBIT, 1998 EPS, 1999 EPS and
2000 EPS were as follows:

LOW       HIGH      MEDIAN      MEAN
----      ----      ------      ----

Enterprise Value to:
LTM Revenues..........................   0.49x     5.18x      2.38x      2.26x
LTM EBITDA............................   5.4      23.2       11.6       11.6
LTM EBIT..............................   6.4      28.3       12.6       14.6
Projected 1999 Revenues...............   0.42      3.85       2.17       1.85
Projected 1999 EBITDA.................   4.1      12.0        8.0        8.0
Projected 1999 EBIT...................   4.9      15.8       10.9       10.8
Equity Value to:
Book Value............................   1.3      11.4        3.4        5.2
1998 EPS..............................   9.5      37.2       21.0       23.2
1999 EPS..............................   7.2      25.9       17.0       17.7
2000 EPS..............................   6.1      21.6       14.4       14.5

ING Barings then applied the relevant ratios for the PIA Comparable
Companies to PIA's financial and operating information and determined an implied
range of equity values for PIA, which ranged from a high of $24.1 million to a
low of $18.6 million. ING Barings noted that these implied equity values were
less than the equity value implied by the Initial Exchange Ratio pursuant to the
Merger Agreement for the PIA stockholders.

COMPARABLE TRANSACTIONS ANALYSIS. ING Barings reviewed and analyzed the
following ten selected mergers and acquisitions announced since 1995 of
companies in the marketing and business services industries (acquiror/target):

- Acxiom Corp./May & Speh Inc.;
- Great Universal Stores PLC/Metromail Corp.;
- Electronic Data Systems Corp./Neodata Services Inc.;
- Chancellor Media Group/Katz Media Group;
- Snyder Communications, Inc./American List Corp.;
- News Corp./Heritage Media Corporation;
- FIserv Inc./BHC Financial Inc.;

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- Snyder Communications, Inc./Medical Marketing Detailing, Inc.;
- Harte-Hanks, Inc./DiMark Inc.; and
- Heritage Media Corp./DIMAC Corp

These transactions are referred to as the "Comparable Acquisitions."

ING Barings compared the enterprise value of the acquired company implied
by each of these transactions as a multiple of LTM revenues, LTM EBITDA and LTM
EBIT and the equity value of the acquired company implied by each of these
transactions as a multiple of LTM net income and one year forward projected
earnings per share to certain financial data. The ranges of the enterprise and
equity values as a multiple of LTM revenues, LTM EBITDA, LTM EBIT, LTM net
income and one year forward projected earnings per share for such acquisitions
were as follows:

LOW       HIGH      MEDIAN      MEAN
----      ----      ------      ----

Enterprise Value to:
LTM Revenues..........................   1.06x     6.16x      2.23x      2.75x
LTM EBITDA............................   5.3      22.7       10.9       11.6
LTM EBIT..............................   5.5      23.7       14.9       13.8
Equity Value to:
LTM Net Income........................  12.6      38.3       27.4       25.2
Projected EPS.........................  13.7      30.8       20.9       21.0

ING Barings then applied the relevant ratios for the Comparable
Acquisitions to SPAR's financial and operating information and determined an
implied range of equity values for SPAR, which ranged from a high of $87.2
million to a low of $62.2 million. ING Barings noted that these implied equity
values exceeded the equity value implied by the Initial Exchange Ratio pursuant
to the Merger Agreement for the PIA stockholders.

ING Barings also applied the relevant ratios for the Comparable
Acquisitions to PIA's financial and operating information and determined an
implied range of equity values for PIA, which ranged from a high of $25.3
million to a low of $22.6 million. ING Barings noted that these implied equity
values were less than the equity value implied by the Initial Exchange Ratio
pursuant to the Merger Agreement for the PIA stockholders.

DISCOUNTED CASH FLOW ANALYSIS. ING Barings calculated ranges of enterprise
values for SPAR and PIA based upon the value, discounted to the present, of an
estimated four calendar year stream of unlevered free cash flow through 2002 and
a projected calendar year 2002 terminal value based on multiples of estimated
unlevered net income set forth in the table. ING Barings prepared the estimates
of SPAR's and PIA's four calendar year stream of unlevered free cash flow and
unlevered net income through 2002 based upon discussions with management of SPAR
and PIA, respectively. ING Barings utilized discount rates set forth in the
table based on theoretical analyses of the weighted average cost of capital and
a range of unlevered net income multiples based on review of the multiples of
the SPAR Comparable Companies, the PIA Comparable Companies and the Acquisition
Comparables. The range of equity values for SPAR and PIA implied by the
discounted cash flow analyses were as follows:

SPAR                         PIA
-------------------------    -----------------------
MULTIPLES OF 2002           MULTIPLES OF 2002
UNLEVERED NET INCOME        UNLEVERED NET INCOME
-------------------------    -----------------------
DISCOUNT RATE        10.0X    12.0X     14.0X     7.0X     8.5X     10.0X
-------------        -----    ------    ------    -----    -----    -----

12.0%....................  $96.8    $115.3    $133.8    $54.9    $61.4    $67.8
14.0%....................   89.1     106.4     123.6     52.5     58.5     64.5
16.0%....................   82.1      98.2     114.3     50.2     55.8     61.5

Based on such analyses, the implied equity value of SPAR ranged from a high
of $133.8 million to a low of $82.1 million and the implied equity value of PIA
ranged from a high of $67.8 million to a low of $50.2 million. ING Barings noted
that the implied equity values of PIA exceed the equity value implied by the
Initial Exchange Ratio for the PIA stockholders and that the implied equity
values of SPAR were less than the equity values implied by the Initial Exchange
Ratio in cases where the midpoint ($59.0 million) to the

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high ($67.8 million) of the PIA implied equity value ranges were compared to the
midpoint ($108.0 million) to the low ($82.1 million) of the SPAR implied equity
value ranges. In virtually all other cases reviewed, the implied equity values
of SPAR exceeded the equity value implied by the Initial Exchange Ratio for the
PIA stockholders and the implied equity values of PIA were less than the equity
values implied by the Initial Exchange Ratio for the PIA stockholders.

The Merger Agreement does not include a condition to closing that requires
ING Barings to update its opinion as of any subsequent date. In the event an
amendment is made to the Merger Agreement which causes a materially significant
change to the Merger Agreement, PIA will obtain a revised fairness opinion.
Significant events that may affect the ING Barings Opinion if it were
redetermined based on a subsequent date include, among others, changes in the
business, operations and prospects of SPAR or PIA, or the comparable companies
or transactions analyzed. However, the obligation of PIA to consummate the
Merger is subject to, among other things, the condition that no material adverse
change in the business, operations, prospects, assets, properties or conditions
of the SPAR Parties shall have occurred (subject to certain limitations).
Therefore, PIA would not be required to close the transaction if such a change
had transpired. See "-- Merger Agreement -- Conditions to the Merger."

The summary set forth above, while containing all material elements of the
analyses performed by ING Barings, does not purport to be a complete description
of such analyses. Arriving at a fairness opinion is a complex process not
necessarily susceptible to partial or summary description. In arriving at its
opinion, ING Barings did not attribute any particular weight to any analysis or
factors considered by it, but rather made qualitative judgments as to the
significance and relevance of each analysis and factor. ING Barings believes
that its analysis must be considered as a whole and that selecting portions of
its analyses and of the factors considered by it, without considering all such
factors and analyses, particularly with respect to the projections provided by
management of PIA and SPAR, could create a misleading view of the process
underlying its analyses set forth in the ING Barings Opinion.

The PIA Board selected ING Barings to render a fairness opinion on the
basis of ING Barings' reputation as an internationally recognized investment
banking firm with substantial experience and expertise in transactions similar
to the Merger and because it had a historical investment banking relationship
with PIA and was familiar with PIA and its business. As part of its investment
banking business, ING Barings is continually engaged in the valuation of
businesses and their securities in connection with mergers and acquisitions. For
ING Barings' services, PIA has agreed to pay ING Barings a transaction fee
equaling the greater of $800,000 or 1.7% of the first $60 million of
consideration plus 0.8% on any consideration in excess of $60 million. Upon
rendering the ING Barings Opinion, PIA has agreed to pay $500,000, which will be
credited against such transaction fee. In addition, PIA agreed to reimburse ING
Barings for its reasonable out-of-pocket expenses (including reasonable fees and
expenses of its legal counsel) not to exceed $30,000 incurred in connection with
its engagement and to indemnify ING Barings and certain related persons against
certain liabilities, including liabilities under securities laws, arising out of
its engagement.

ING Barings has also performed various investment banking services for PIA
in the past, including advisory service regarding the contemplated private
equity offering, and has received customary fees for such services. Since
January 1997, the total amount of fees owed or paid to ING Barings by PIA for
services rendered was approximately $600,000, all of which is to be credited
against the transaction fee for the Merger described above. In the ordinary
course of its securities business, ING Barings may actively trade equity
securities of PIA for its own account and the accounts of its customers, and ING
Barings therefore may hold a long or short position in such securities.

RECOMMENDATION OF THE BOARD OF DIRECTORS OF PIA

The PIA Board has unanimously approved the Merger and the Share/Option
Issuance and related matters and believes they are fair to, and in the best
interests of PIA and PIA's stockholders. The PIA Board unanimously recommends
that stockholders approve the Share/Option Issuance.

REGULATORY APPROVAL

PIA and SPAR must comply with certain federal and state regulatory
requirements in order to consummate the Merger, including (i) compliance with
applicable federal and state securities laws providing
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for the issuance of the Merger Consideration in the absence of registration
under the Securities Act; and (ii) the listing on the Nasdaq National Market of
the Merger Consideration. The consummation of the Merger is also subject to the
expiration or termination of the applicable waiting period under the HSR Act.
PIA and SPAR filed notification and report forms under the HSR Act and on June
21, 1999 received confirmation of early termination of all applicable waiting
periods.

MATERIAL CONTRACTS BETWEEN PIA AND SPAR

There are no material agreements between any SPAR Company, the SAI
Stockholders or their affiliates on the one hand, and any PIA Party or their
affiliates on the other hand, other than the Merger Agreement, and agreements
executed in connection with the Merger Agreement and the transactions
contemplated thereby.

INTERESTS OF CERTAIN PERSONS IN THE MERGER

In considering the recommendations of the PIA Board with respect to the
approval of the Share/Option Issuance and the other proposals contained herein,
the holders of PIA Common Stock should be aware that certain members of PIA's
management and the PIA Board have interests in the Merger which are different
from, or in addition to, the interests of PIA's stockholders generally. The PIA
Board was aware of these interests and considered them in approving the Merger,
the Share/Option Issuance and the transactions contemplated thereby. See "Risk
Factors -- Officers and Directors of PIA will Receive Benefits That are Contrary
to the Interests of Other Stockholders."

INDEMNIFICATION OF OFFICERS AND DIRECTORS OF PIA

The Merger Agreement provides that for a period of six years from and after
the Effective Time, (a) the PIA Parties and the SPAR Companies will not amend
any provisions limiting personal liability of any of their present or former
directors, officers, employees or agents contained in such party's charter
documents as in effect on February 28, 1999, and (b) the PIA Parties will
indemnify to the fullest extent permitted by law (i) each of the seven nominees
for director set forth under "Proposal VII: Election of Directors," (ii) each
person who has served as a director of PIA prior to February 28, 1999, and (iii)
each officer holding a title of Senior Vice President or higher with PIA, PIA
California or any of PIA California's subsidiaries as of February 28, 1999. In
addition, each of the PIA Parties and the SPAR Companies has also agreed to
maintain current directors' and officers' liability insurance as in effect on
the Closing Date for six years following the Merger for claims arising from
events which occurred prior to the Effective Time.

ACCELERATION OF VESTING OF PIA STOCK OPTIONS

Pursuant to action taken by the PIA Board, all PIA stock options granted to
its non-employee directors will automatically vest in full upon the occurrence
of the Merger. In addition, pursuant to PIA Board action, unvested stock options
held by any officer or other employee of PIA will be automatically vested in
full if an officer is terminated without cause within two years (one year for
all other employees) following the Merger, and the vesting schedule for all such
PIA options will be automatically accelerated by two years upon the consummation
of the Merger.

SEVERANCE ARRANGEMENTS

Pursuant to the terms of Mr. Peets' employment agreement, Mr. Peets is
entitled to receive his salary for 18 months if the Combined Company terminates
his employment "without cause" during the two year period following the Merger,
or if Mr. Peets terminates his employment for a "material reason" (each, as
defined in his employment agreement) within one year following the Merger.
Pursuant to the terms of Ms. Wood's severance agreement with PIA, Ms. Wood is
entitled to receive her salary for 18 months if the Combined Company terminates
her employment "without cause" during the two year period following the Merger,
or if Ms. Wood terminates her employment for "good reason" (each, as defined in
her severance agreement) within one year following the Merger.

PIA has adopted severance policies pursuant to which (i) John Bain and Don
Holman will continue to receive their base salary and certain employee benefits
for a period of 12 months if they are terminated without
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cause within two years following the Merger, (ii) Larry Dorr and Mark Hallsman
will continue to receive their base salary and certain employee benefits for a
period of nine months if they are terminated without cause within two years
following the Merger, (iii) other officers will continue to receive their base
salary and certain employee benefits for a period equal to the greater of six
months or one week for each year of employment with PIA if they are terminated
without cause within two years following the Merger, and (iv) all other
employees will continue to receive their base salary for a period equal to one
week for each year of employment with PIA (with prorated payments for partial
years of service) if they are terminated without cause within one year following
the Merger.

PIA currently estimates that it will owe an aggregate of $3.0 million in
severance payments following the Merger.

STOCK OWNERSHIP FOLLOWING THE MERGER

In the Merger, PIA estimates that it will issue approximately 12.7 million
shares of PIA Common Stock to the SAI Stockholders and issue Substitute Options
to purchase 134,114 shares of PIA Common Stock to the SAI Option Holders
assuming no exercise of existing PIA options or warrants prior to the Merger.
Based on the number of shares of PIA Common Stock outstanding on June 7, 1999
(5,480,966 outstanding shares), upon the consummation of the Merger, PIA will
issue an aggregate of approximately 12,654,806 shares of PIA Common Stock to the
SAI Stockholders and Substitute Options covering an aggregate of 134,114 shares
of PIA Common Stock to the holders of SAI Options. Such shares of PIA Common
Stock would have a value of approximately $45.1 million and the Substitute
Options (assuming full exercise thereof and without regard to vesting) would
have a value of approximately $480,000, based upon the closing price of PIA
Common Stock as reported on the Nasdaq National Market on June 7, 1999.
Immediately following the Merger and assuming full exercise of all Substitute
Options without regard to vesting, the SAI Stockholders and the holders of
Substitute Options will hold an aggregate of approximately 70% of the PIA Common
Stock outstanding post-Merger, and the holders of PIA Common Stock immediately
prior to the Merger will hold an aggregate of approximately 30% of the PIA
Common Stock outstanding post-Merger (assuming full exercise of all Substitute
Options and without regard to vesting). PIA does not anticipate the exercise of
any options or warrants prior to the Merger because the per share exercise price
of the majority of existing PIA options exceeds the closing price of the PIA
Common Stock as of the business day immediately prior to the date of this Proxy
Statement. In the event any PIA options are exercised prior to the Merger, the
actual number of shares of PIA Common Stock issuable to the SAI Stockholders
will increase, so that the SAI Stockholders and SAI Option Holders (assuming
full exercise of all Substitute Options) will still receive an aggregate of
approximately 70% of the PIA Common Stock outstanding post-Merger. See "Security
Ownership of Certain Beneficial Owners of the Combined Company Following the
Merger."

RESALE OF PIA COMMON STOCK ISSUED IN THE MERGER

The shares of PIA Common Stock issued to the SAI Stockholders in the Merger
will not be registered under the Securities Act. Such shares will be
"restricted" securities as that term is defined under Rule 144 promulgated under
the Securities Act, and may be resold only pursuant to an effective registration
statement under the Securities Act or an applicable exemption from the
registration requirements of the Securities Act.

ACCOUNTING TREATMENT

The Merger will be treated as a purchase of PIA by SPAR. For accounting
purposes, SPAR is the accounting acquiror since the holders of SAI Common Stock
would hold and have voting power with respect to approximately 70% of the total
issued and outstanding voting capital stock of PIA immediately following the
Merger. Under purchase accounting, the fair value of all the shares of PIA
Common Stock outstanding immediately prior to the Merger will be allocated to
the individual PIA assets and liabilities based on their relative fair values.
The excess of the purchase price over the face value of the net assets acquired
will be amortized over the estimated period benefitted not to exceed 15 years.
The individual allocations are subject to valuations as of the date of the
Merger based on appraisal and other studies, which are not yet completed.
Accordingly, the final allocations will be different from the amounts reflected
in the unaudited pro forma condensed combined financial information. Although
the final allocations will differ, the unaudited pro forma condensed combined
financial information reflects SPAR's best estimate based on currently available
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information as of the date of this Proxy Statement. See "Pro Forma Condensed
Combined Financial Information."

CERTAIN FEDERAL INCOME TAX CONSEQUENCES

The Merger of SAI and PIA is intended to be a "tax-free reorganization,"
for Federal income tax purposes under Section 368 of the Code. Neither PIA nor
SAI will recognize any gain or loss in the Merger and neither the PIA
stockholders nor SAI Stockholders will recognize any gain or loss in the Merger,
except to the extent SAI Stockholders receive cash in lieu of fractional shares.

NO APPRAISAL RIGHTS FOR DISSENTERS

Under Delaware law, PIA's stockholders will not be entitled to appraisal
rights in connection with the Merger.

MERGER AGREEMENT

The description of the Merger Agreement set forth below does not purport to
be complete and is qualified in its entirety by reference to the Merger
Agreement, attached hereto as Annex A and incorporated herein by reference.
Stockholders are urged to read the Merger Agreement in its entirety.

THE MERGER

On February 28, 1999, PIA, PIA California and PIA Acquisition entered into
the Merger Agreement with the SPAR Companies pursuant to which PIA Acquisition
will merge with and into SAI with SAI surviving and PIA Acquisition ceasing to
exist.

MERGER CONSIDERATION; NO FRACTIONAL SHARES

Pursuant to the Merger Agreement, PIA will issue approximately 12.7 million
shares of PIA Common Stock to the SAI Stockholders. Under the terms of the
Merger Agreement, each share of SAI Common Stock outstanding immediately prior
to the Effective Time will be converted into the right to receive one share of
PIA Common Stock. The shares of SAI Common Stock are, and will be at Closing,
the only outstanding securities of SAI. Each holder of SAI Common Stock entitled
to receive a fractional share of PIA Common Stock shall receive a cash payment
from PIA in lieu of such fractional share in an amount equal to such fractional
proportion multiplied by the closing price of one share of PIA Common Stock on
the Closing Date. PIA will also assume all outstanding options to purchase SAI
Common Stock and issue Substitute Options covering an aggregate of 134,114
shares of PIA Common Stock to the holders of SAI Options. Each Substitute Option
shall provide for the same terms and conditions (including an exercise price of
$0.01 per share) and right to purchase the same number of shares as the
surrendered SAI Options.

SUBSTITUTE OPTIONS

As of the Effective Time, PIA will assume all of the outstanding SAI
Options to purchase SAI Common Stock. PIA shall issue to each holder of an
outstanding SAI Option, against delivery and cancellation of the agreement
evidencing such outstanding SAI Option, a Substitute Option under PIA's Special
Purpose Stock Option Plan. Each Substitute Option shall entitle the SAI Option
Holder to purchase the same number of shares of PIA Common Stock as the number
of shares of SAI Common Stock that could have been purchased under the SAI
Option (reflecting the one-to-one Amended Exchange Ratio) and shall otherwise be
issued upon the same terms and conditions as set forth in the written agreement
evidencing the SAI Option so surrendered, including (without limitation) the
same per share exercise price and the same vesting as the surrendered SAI
Option. All SAI Options have, and each Substitute Option will have, an exercise
price of $0.01 per share and will vest immediately upon the Merger. In addition,
PIA has undertaken to prepare and file with the Commission a registration
statement which shall cover the shares of PIA Common Stock issuable upon
exercise of the Substitute Options. PIA shall use its reasonable efforts to
maintain the effectiveness of such registration statement so long as any options
covered thereby remain outstanding and unexercised. THE FOREGOING DISCUSSION
DOES NOT ADDRESS ANY TAX CONSEQUENCES ASSOCIATED WITH THE SAI OPTIONS OR THE
SUBSTITUTE OPTIONS.
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REPRESENTATIONS AND WARRANTIES

The Merger Agreement contains various representations and warranties of the
SPAR Companies, on the one hand, and the PIA Parties, on the other hand,
relating to, among other things: (i) due organization and similar corporate
matters; (ii) capital structure; (iii) authorization, execution, delivery,
performance and enforceability of the Merger Agreement and related matters; (iv)
absence of any conflict with their respective charter documents, bylaws and
material contracts and any applicable laws; (v) governmental or regulatory
approvals and consents of third parties required to consummate the Merger; (vi)
their respective financial statements; (vii) the absence of certain material
events and changes since the date of their respective financial statements; and
(viii) various matters relating to their respective assets, and the operations
and conduct of their respective businesses.

CERTAIN COVENANTS

Pursuant to the Merger Agreement, the SPAR Companies, on the one hand, and
the PIA Parties, on the other hand, have agreed that during the period from the
date of the Merger Agreement through the Closing Date, and except as permitted
by the Merger Agreement, each will, among other things: (i) conduct its business
in the ordinary course and consistent in all material respects with past
practice; (ii) maintain and service their respective properties and assets in
order to preserve their value and usefulness in the conduct of their respective
business consistent with past practice and commercially reasonable standards;
(iii) keep available the services of their current employees and agents and
maintain their relations and goodwill with suppliers, customers, distributors
and any others with whom or with which they have business relations; (iv) comply
in all material respects with all laws, ordinances, rules, regulations and
orders; (v) cause all of the conditions to the consummation of the transactions
contemplated by the Merger Agreement to be satisfied on or prior to the Closing
Date; and/or (vi) provide the other party reasonable access to all of their
premises, properties, assets, records, contracts and related materials and
permit the other party to consult with the employees and agents of such party.

In addition, no PIA Company and no SPAR Company shall: (i) enter into any
agreement or other arrangement for the acquisition or proposed acquisition of
any other corporation, business or entity, whether by means of an asset
purchase, stock purchase, merger or otherwise; (ii) except as expressly
contemplated by the Merger Agreement or upon the exercise of stock options
outstanding on February 28, 1999, issue or agree to issue, any shares of, or
rights of any kind to acquire any shares of its capital stock; (iii) increase
the compensation payable or to become payable to any officer or director except
in accordance with employment agreements or benefit plans in effect as of
February 28, 1999 and except for increases consistent with past practice; (iv)
adopt or enter into any employee benefit or compensation plan, agreement or
arrangement except for individual employment agreements and arrangements in the
ordinary course of business consistent with past practice; (v) make any loan or
advance to, or enter into any non-employment contract, lease or commitment with,
any officer or director; (vi) assume, guarantee, endorse or otherwise become
responsible for any material obligations of any other individual, firm or
corporation or make any material loans or advances to any individual, firm or
corporation (other than pursuant to existing agreements or as otherwise
disclosed to the other in the Merger Agreement); (vii) modify or amend in any
material respect or take any action to voluntarily terminate any material
contract or any amendment to the Field Service Agreement; (viii) waive, release,
grant or transfer any rights of material value except in the ordinary course of
business or as contemplated by the Merger Agreement or the agreement to effect
the SPAR Reorganization Transactions; (ix) transfer, lease, license, sell,
mortgage, pledge, dispose of or encumber any material assets other than in the
ordinary course of business and consistent with past practice; (x) take any
action, other than reasonable and usual actions in the ordinary course of
business and consistent with past practice, with respect to accounting policies
or procedures, except for changes required by generally accepted accounting
principles ("GAAP"); (xi) settle or compromise any material federal, state,
local or foreign income tax proceeding or audit with respect to such party; or
(xii) enter into an agreement to do any of the foregoing.

The SPAR Companies have agreed to use their reasonable best efforts to
ensure that the consolidated net worth of SPAR as determined by a post-closing
audit pursuant to the terms of the Merger Agreement is not less than $1,436,000
(after giving effect to the exclusion of certain charges and other costs as set
forth therein) and the SAI Principals, at their option, will either pay PIA the
amount of any shortfall or reduce the amounts owed by SMCI to the SAI Principals
by a corresponding amount. The SPAR Companies also will cause the
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SPAR Reorganization Transactions to be consummated prior to the Effective Time.
In addition, the SPAR Companies and the PIA Parties have agreed not to amend any
provision limiting personal liability of PIA's present or former directors,
officers, employees and agents contained in PIA's charter documents and to
indemnify PIA's current and former directors and certain of its officers to the
fullest extent permitted by law. See "-- Interests of Certain Persons in the
Merger."

CONDITIONS TO THE MERGER

The obligations of each of the parties to the Merger to effect the Merger
are subject to the satisfaction (or to the extent permitted by law, the waiver
by either PIA or SPAR) of a number of conditions, including: (i) approval of the
Share/Option Issuance and each of the Pre-Merger Charter Amendments by the
requisite vote of PIA's stockholders; (ii) the absence of any legal restraints
or prohibitions preventing the consummation of the Merger; (iii) the listing on
the Nasdaq National Market of the PIA Common Stock to be issued in the Merger
and the continued listing of existing shares of PIA Common Stock; (iv) the
filing of the Certificate of Amendment to PIA's Certificate of Incorporation to
effectuate each of the Pre-Merger Charter Amendments; (v) the execution of a
software ownership agreement by SMF, SMS and SIT with respect to Internet job
scheduling software jointly developed by such parties; (vi) receipt by STM of an
assignment of the SPAR trademark registrations in the U.S. and Canada; (vii) a
license agreement among SIT, SMS and STM whereby STM will grant non-exclusive
royalty-free licenses to SIT and SMS for the use of the name "SPAR" and certain
other trademarks and related rights owned by STM; and (viii) the SPAR Companies
and the PIA Companies shall have executed an indemnification agreement (the
"Limited Indemnification Agreement") with the SAI Principals with respect to
such stockholders' obligations regarding the SMS tax litigation and ADVO Note
and an escrow agreement (the "Indemnity Escrow Agreement") to place an aggregate
of 10% of the shares of PIA Common Stock to be issued to the SAI Principals and
their family members in the Merger in escrow as security for such
indemnification obligations. PIA may need to obtain a waiver from SPAR for
condition (iii) above, which SPAR is under no obligation to provide.

In addition, the obligations of the SPAR Companies to consummate the Merger
are subject to, among other things, the satisfaction or waiver by PIA of the
following conditions: (i) the representations and warranties of the PIA Parties
shall be accurate in all material respects as of the Closing Date, subject to
certain limitations; (ii) all terms, covenants and conditions required by the
Merger Agreement to be performed by the PIA Parties by the Closing shall have
been complied with and performed in all material respects; (iii) since December
31, 1998, no material adverse change in the business, operations, assets,
properties, or condition of the PIA Companies taken as a whole shall have
occurred, and the PIA Companies shall not have suffered any uninsured material
loss or damage to any of their properties or assets, that would be reasonably
likely to materially affect or impair the ability of the PIA Companies to
conduct their business; and (iv) the persons set forth under the "-- Board of
Directors and Management After the Merger" shall have been elected or appointed
as directors and officers of PIA.

In addition to the conditions set forth in the first paragraph of this
section, the obligation of the PIA Parties to consummate the Merger are subject
to, among other things, the satisfaction or waiver by SPAR of the following
conditions: (i) the representations and warranties of the SPAR Companies shall
be accurate in all material respects as of the Closing Date, subject to certain
limitations; (ii) all terms, covenants and conditions required by the Merger
Agreement to be performed by the SPAR Companies by the Closing shall have been
complied with and performed in all material respects; (iii) since December 31,
1998, no material adverse change in the business, operations, assets,
properties, prospects or condition of the SPAR Companies taken as a whole shall
have occurred, and the SPAR Companies shall not have suffered any uninsured
material loss or damage to any of their properties or assets, that would be
reasonably likely to materially affect or impair the ability of the SPAR
Companies to conduct their business; (iv) all property and assets currently used
by any SPAR Company in the conduct of its business as of the date of the Merger
Agreement which are not owned by, licensed to or leased by a SPAR Company shall
have been transferred or assigned to a SPAR Company without the payment of any
consideration therefor; and (v) the SAI Stockholders shall have delivered a
mutual release releasing each SPAR Company from any claims of the SAI
Stockholders against each SPAR Company for matters preceding the Closing Date.

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TERMINATION

The transactions contemplated by the Merger may be terminated under the
following limited circumstances: (i) by mutual written consent of PIA and SAI;
(ii) by either PIA or SAI if, without fault of such terminating party, the
Merger is not consummated on or prior to June 30, 1999; (iii) by PIA, if there
is a breach of any of the representations and warranties of any SPAR Company,
subject to certain limitations, or if any SPAR Company fails to comply after
notice with any of its covenants or agreements contained in the Merger
Agreement, which breaches or failures are, in the aggregate, material in the
context of the transactions contemplated by the Merger Agreement and cannot
reasonably be anticipated to be cured within thirty days of the date of such
notice; (iv) by SAI, if there is a breach of any of the representations and
warranties of any PIA Party, subject to certain limitations, or if any PIA Party
fails to comply after notice with any of its covenants or agreements contained
herein, which breaches or failures are, in the aggregate, material in the
context of the transactions contemplated by the Merger Agreement and cannot
reasonably be anticipated to be cured within thirty days of the date of such
notice; (v) by PIA on written notice to SAI, if (A) an Acquisition Proposal (as
defined below) has been made and not withdrawn, (B) a majority of disinterested
members of the PIA Board determines in good faith (with the advice of
independent financial advisors and legal counsel) that such Acquisition Proposal
is superior for PIA's stockholders to the transaction contemplated by the Merger
Agreement, (C) PIA has notified SAI in writing of the determination described in
clause (B) above, (D) at least five (5) business days have elapsed following
receipt by SAI of such written notice and (taking into account any revised
proposal made by SAI since receipt of such written notice) such Acquisition
Proposal remains an Acquisition Proposal and a majority of the disinterested
directors of the PIA Board has again made the determination referred to in
clause (B) above, (E) the PIA Board concurrently approves, and (F) PIA
concurrently enters into, a definitive agreement providing for the
implementation of such Acquisition Proposal subject to payment of the breakup
fee and expense reimbursement described below; (vi) by either PIA or SAI on
written notice to the other, if a governmental entity shall have enacted any
law, rule, regulation, injunction or other order which is in effect and has the
effect of making illegal or otherwise prohibiting the transactions contemplated
by the Merger Agreement; and (vii) by SAI or PIA, if PIA's stockholders do not
approve either the Share/Option Issuance or any of the Pre-Merger Charter
Amendments by the requisite vote as described in this Proxy Statement.

BREAKUP FEE

If PIA terminates the Merger Agreement and enters into a definitive
agreement implementing an Acquisition Proposal (as described in the above
paragraph), PIA shall pay the SPAR Companies a breakup fee equal to 3.5% of the
value of the consideration in connection with such Acquisition Proposal as
determined by the Merger Agreement and the amount of the reasonable costs and
expenses of the SPAR Companies and the SAI Stockholders incurred in connection
with the preparation, negotiation, execution and performance of the Merger
Agreement.

NO SOLICITATION

Each PIA Party has agreed not to direct or cause its respective directors,
officers, employees, representatives or agents to initiate, solicit or encourage
any inquiries or the making or implementation of any proposal or offer, with
respect to any merger, acquisition, consolidation, share exchange, business
combination or other transaction involving: (i) the acquisition of a majority of
the outstanding equity securities of any PIA Company, (ii) the issuance by any
PIA Company of equity securities which would represent upon issuance a majority
of the outstanding equity securities of any PIA Party, or (iii) the acquisition
of a majority of the consolidated assets of any PIA Company (any such proposal
or offer being referred to as an "Acquisition Proposal"), or engage in any
negotiations concerning, or provide any confidential information or data to, or
have any discussions with, any person or entity relating to an Acquisition
Proposal, or otherwise facilitate any effort or attempt to make or implement an
Acquisition Proposal; provided, however, that the PIA Board may furnish
information (a) to, or enter into discussions or negotiations with, any person
or entity that makes an unsolicited bona fide Acquisition Proposal or (b) as
required by securities laws.

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INDEMNIFICATION

As a condition to the Closing of the Merger, the SAI Principals, jointly
and severally, pursuant to the Limited Indemnification Agreement will agree to
indemnify the PIA Parties and the SPAR Companies against (a) any taxes or losses
incurred on or before the Closing Date for certain employment tax and employee
benefit matters relating to litigation involving SMS and the reclassification by
the IRS of SMS' independent contractors as employees and or (b) any amounts due
under the ADVO Note ($3 million in maximum principal amount).

As a condition to the Closing of the Merger and pursuant to the Indemnity
Escrow Agreement, the SAI Principals will deposit an aggregate of ten percent of
the shares of PIA Common Stock issued to them and their family members in the
Merger in escrow as security for such stockholders' indemnification obligations.
Any claim for indemnification must be made on or prior to February 28, 2004. If
there are no unsatisfied or disputed claims for matters regarding the SMS tax
litigation made against the escrowed shares, one-half of the escrowed shares
will be released on March 31, 2000. In addition, the PIA Board will evaluate the
amount of collateral reasonably necessary to continue to secure the SAI
Principals' indemnification obligations on or before the second, third and
fourth anniversary dates of the Merger Agreement and release any escrowed shares
in excess of such amounts, provided that there are no unsatisfied or disputed
claims for matters regarding the SMS litigation.

The SAI Principals have also agreed to reimburse PIA for any short-fall to
the extent the consolidated net worth of SPAR as determined by a post-closing
audit pursuant to the terms of the Merger Agreement is less than one million
four hundred thirty six thousand dollars ($1,436,000) (after giving effect to
the exclusion of certain charges and other costs as set forth therein) or to
reduce the amount of the obligation owed by SMCI to the SAI Principals by the
amount of such shortfall.

LICENSE OF SPAR NAME AND OTHER INTELLECTUAL PROPERTY AGREEMENTS

As a condition to the Closing of the Merger, STM will enter into a
Trademark License Agreement (the "Trademark Agreement") with SIT and SMS. Under
the terms of the Trademark Agreement, STM will grant licenses to SIT and SMS to
use (i) certain trademarks in the United States and Canada in connection with
the products and services claimed in the registrations for such trademarks and
(ii) the name "SPAR." In addition, SIT will enter into a Software Ownership
Agreement (the "Software Agreement") with SMF and SMS. Under the terms of the
Software Agreement, each party agrees that each other party to the Software
Agreement is a co-owner of certain confidential information and software and
program documentation created jointly by SIT, SMF and SMS.

OBLIGATIONS IN CONNECTION WITH THE MCI ACQUISITION

MCI ACQUISITION. On January 15, 1999, SMCI acquired all of the business and
substantially all of the assets of MCI, pursuant to the MCI Agreement. See
"Business of SPAR -- Premium Incentive Division -- MCI Acquisition." The MCI
Acquisition was financed in part through the issuance by SMCI of a promissory
note dated as of January 15, 1999 (the "MCI Note"), to MCI in an aggregate
original principal amount equal to $12,422,189 plus the amount of the Earn-Out
Consideration (as defined in the MCI Agreement). The MCI Agreement provides that
MCI is generally entitled to Earn-Out Consideration equal to the earnings before
taxes, subject to certain adjustments ("EBT"), of MCI for the period from April
1, 1998, through January 15, 1999, and of SMCI thereafter through March 31,
1999, but MCI is not entitled to any Earn-Out Consideration if the EBT for such
combined periods does not exceed $3,500,000.

The MCI Note is payable in monthly installments of $400,000, subject to
possible reductions, and is due in full on September 15, 1999. The payment of
$250,000 of each monthly installment is limited to Available Cash and such
installments are automatically reduced (with the reductions deferred to
maturity) if there is insufficient Available Cash. The MCI Note defines
"Available Cash" as "the cash and cash equivalents of SMCI in excess of
$1,500,000 at the time of payment and calculation (after giving effect to the
payment of interest to accompany such installment)." MCI may elect to receive up
to $3,000,000 of the final installment payment in unregistered shares of common
stock of any publicly traded company holding, directly or indirectly, all of the
issued and outstanding stock of SMCI (i.e., in shares of PIA Common Stock),
valued at the average public trading price for the 30 day period preceding the
maturity date. In connection with the note
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to MCI, Messrs. Brown and Bartels pledged their shares of SMCI stock to secure
SMCI's obligations under the MCI Note. Under the terms of an hypothecation
agreement, MCI will be entitled to foreclose on the SMCI securities if the MCI
Note is accelerated or if the debt is not paid in full upon maturity.

Based upon the unaudited balance sheet of MCI as of January 15, 1999, SMCI
estimates that a net worth adjustment in the amount of approximately $2 million
is due to SMCI from MCI. Neither the net worth adjustment nor the Earn Out
Consideration calculation has been agreed to by MCI, and MCI is believed to be
reviewing whether SMCI's net worth calculation is accurate and any Earn Out
Consideration is due. If the parties cannot agree upon such amounts, legal
proceedings may ensue with respect to this matter.

BOARD OF DIRECTORS AND MANAGEMENT AFTER THE MERGER

The following table sets forth certain information in connection with each
person who will be an executive officer or director of PIA immediately after the
Effective Time of the Merger other than each of Messrs. Peets, Collins and Lewis
whose business experience is described in "Proposal VII: Election of
Directors--Information Concerning Nominees to PIA Board" and Ms. Wood whose
business experience is described in "Executive Officers' Compensation and Other
Information of PIA." Ages are as of May 1, 1999.

POSITION WITH THE
COMBINED COMPANY AFTER
NAME              AGE   CURRENT POSITION WITH PIA OR SPAR           THE MERGER
----              ---   ---------------------------------  ----------------------------

Robert G. Brown.............  54    Chairman, Chief Executive          Chairman, Chief Executive
Officer, President and Director    Officer, President and
of each of the SPAR Companies      Director
William H. Bartels..........  55    Vice Chairman, Senior Vice         Vice Chairman and Director
President, Treasurer, Secretary
and Director of each of the SPAR
Companies
Patrick W. Collins..........  70    Director of PIA                    Director
Robert O. Aders.............  71    None                               Director
J. Christopher Lewis........  43    Director of PIA                    Director
Terry R. Peets..............  55    Chief Executive Officer,           Vice Chairman
President and Director of PIA
James H. Ross...............  66    Chief Financial Officer of each    Treasurer
of the SPAR Companies
Cathy L. Wood...............  51    Executive Vice President, Chief    Executive Vice President,
Financial Officer and Secretary    Chief Financial Officer and
of PIA                             Secretary

Robert G. Brown will become the Chairman, Chief Executive Officer and
Director of the Combined Company upon consummation of the Merger. Mr. Brown has
been the Chairman, President and Chief Executive Officer of the SPAR Marketing
Companies (SBRS since 1994, SINC since 1979, SMNEV since November 1993, and SMF
since SMF acquired its assets and business from ADVO in 1996).

William H. Bartels will become the President of the SPAR Merchandising
Division, the President of the SPAR Marketing Companies, and a Vice Chairman and
Director of the Combined Company upon consummation of the Merger. Mr. Bartels
has served as the Vice-Chairman, Secretary, Treasurer and Senior Vice
President-Corporate of the SPAR Marketing Companies (SBRS since 1994, SINC since
1979, SMNEV since November 1993, and SMF since SMF acquired its assets and
business from ADVO in 1996), and has been responsible for SPAR's sales and
marketing efforts, as well as for overseeing joint ventures and acquisitions.

Robert O. Aders will become a director of the Combined Company upon the
consummation of the Merger. Mr. Aders has served as Chairman of The Advisory
Board, Inc., an international consulting organization since 1993, as President
Emeritus of the Food Marketing Institute ("FMI") since 1993, and as counsel to
Collier, Shannon, Rill & Scott, a Washington, D.C. law firm since 1993.
Immediately prior to his election to the presidency of FMI in 1976, Mr. Aders
was Acting Secretary of Labor in the Ford Administration. Mr. Aders was the
Chief Executive Officer of FMI from 1976 to 1993. He also served in the

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Kroger Co., in various executive positions and was Chairman of the Board from
1970 to 1974. Mr. Aders also serves as a director of FMI, the Stedman Nutrition
Foundation at Duke Medical Center, Checkpoint Systems, Inc., Coinstar, Inc.,
Source Information Systems and Telepanel Systems, Inc., and as a trustee of The
National Urban League, Food Industry Crusade Against Hunger and St. Joseph
Academy of Food Marketing.

James H. Ross will become the Treasurer of the Combined Company upon
consummation of the Merger. Mr. Ross has been the Chief Financial Officer of the
SPAR Marketing Companies since 1991, and the General Manager of SBRS since 1994.

If the Merger is not consummated, the current directors of PIA will
continue to serve as directors of PIA until their successors are duly elected
and qualified, and the current executive officers of PIA will continue to serve
in their current positions until the end of their present employment terms as
set forth in their existing employment agreements, or if no such agreement
exists, as determined by the PIA Board.

CURRENT BOARD OF DIRECTORS AND MANAGEMENT OF PIA

Set forth in the table below are the names, ages and positions of the
current directors and executive officers of PIA. Ages are as of May 1, 1999.
Executive officers are elected by and serve at the discretion of the PIA Board.
None of the executive officers has any family relationship to any nominee for
director or to any other executive officer of PIA.

NAME                   AGE              POSITION WITH PIA
----                   ---    --------------------------------------

Clinton E. Owens......................  57     Chairman of the Board and Director
Patrick W. Collins....................  70     Director
John A. Colwell.......................  48     Director
Joseph H. Coulombe....................  68     Director
Patrick C. Haden......................  46     Director
J. Christopher Lewis..................  43     Director
Terry R. Peets........................  55     Chief Executive Officer, President and
Director
Cathy L. Wood.........................  51     Executive Vice President, Chief
Financial Officer and Secretary
Donald H. Holman......................  42     Executive Vice President -- Marketing
and Sales
John R. Bain..........................  52     Executive Vice President -- Operations
Mark J. Hallsman......................  44     Senior Vice President -- Field
Logistics and Operations Planning

ADDITIONAL OPTION GRANTS TO SPAR EMPLOYEES AND OTHER INDIVIDUALS

Subject to the consummation of the Merger and the approval of the Option
Plan Amendment, the PIA Board has agreed to grant options covering an aggregate
of up to 2,133,744 shares of PIA Common Stock under the 1995 Option Plan to
employees of SPAR and other individuals providing valuable services to SPAR. The
date of grant of such stock options shall be the Closing Date, and the exercise
price of such stock options shall be the last sale price as reported on the
Nasdaq National Market on the Closing Date.

REASON FOR AUTHORIZATION

The rules of the Nasdaq National Market require stockholder approval in
connection with the acquisition of the stock or assets of another company if the
number of shares of PIA Common Stock to be issued in the transaction would equal
or exceed 20% of the number of shares of PIA Common Stock outstanding
immediately prior to such issuance or if the issuance of the PIA Common Stock
would result in a change of control of PIA.

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VOTE REQUIRED

The rules of the Nasdaq National Market require the affirmative vote of a
majority of the votes cast in person or by proxy at the Annual Meeting to
approve the Share/Option Issuance. The PIA Board has unanimously determined that
the Merger and the Share/Option Issuance are in the best interests of PIA and
the stockholders of PIA, and has approved the Merger Agreement and the
Share/Option Issuance. Approval of the Share/Option Issuance, each of the
Pre-Merger Charter Amendments, the Option Plan Amendment and the Reverse Split
Proposal is required for the Merger to be consummated. If any one of the
foregoing six proposals is not approved, even if the other five proposals are
approved, the Merger cannot be consummated and none of the six proposals will be
approved. THE PIA BOARD UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR"
APPROVAL OF THE SHARE/OPTION ISSUANCE.

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BUSINESS OF PIA

This section and other parts of this Proxy Statement contain, in addition
to historical information, forward-looking statements that involve risks and
uncertainties. Actual results could differ significantly from the results
discussed in the forward-looking statements. Factors that could cause or
contribute to such differences include, but are not limited to, those discussed
in "Risk Factors." See the glossary at Annex E for a description of certain
terms that are used throughout this Proxy Statement.

GENERAL

PIA is a supplier of in-store merchandising and sales services in the
United States and Canada. PIA provides these services primarily on behalf of
consumer product manufacturers, consumer service companies and retailers at
approximately 17,000 retail grocery stores, 6,000 mass merchandiser and 8,800
drug stores.

PIA currently provides three principal types of services: shared services,
where an associate represents multiple clients; dedicated services, where
associates work for one specific client; and project services, where associates
perform specified in-store activities.

Shared services consist of regularly scheduled, routed merchandising
services provided at the stores for multiple manufacturers, primarily under
multi-year contracts. Shared services may include activities such as: ensuring
that client's products authorized for distribution are in stock and on the
shelf, adding in new products that are approved for distribution but not present
on the shelf, setting category shelves in accordance with approved store
schematics, ensuring that shelf tags are in place, checking for the overall
salability of clients' products and selling new product and promotional items.

In 1998, PIA developed a new strategy for routed merchandising services.
The stores are selected for routed merchandising services based on two sets of
criteria. The first is the store's weekly All Commodity Volume ("ACV"). The
higher the sales volume of a store, the greater the need for merchandising
services and more frequent visits to the store are required. The second
criterion is based on retailer discipline. This is a subjective determination
and therefore based on retail conditions, schematic discipline and competitive
activity. This new market strategy provides PIA's clients with an added focused
approach to meeting their merchandising needs.

Dedicated services generally consist of merchandising services as described
above except that dedicated services are performed for a specific retailer or
manufacturer by a dedicated organization. The merchandisers and management team
work exclusively for that retailer or manufacturer. These services are normally
provided under multi-year contracts.

For both shared service clients and dedicated service clients, PIA also
performs project services. Project services consist primarily of specific
in-store services initiated by retailers and manufacturers, such as new product
launches, special seasonal or promotional merchandising, focused product support
and product recalls. These services typically are used for large-scale
implementations over 30 days. PIA also performs other project services, such as
new store sets and existing store resets, re-merchandising, remodels and
category implementations, under shared service contracts or stand-alone project
contracts.

As part of its shared and dedicated services, PIA also collects and
provides to certain clients a variety of merchandising data that is category,
product and store specific.

PIA, organized in 1943, initially provided merchandising services in
grocery retail chains on behalf of manufacturers. In mid-1988, it was determined
that a national merchandising company could capitalize on developments within
the retail grocery industry by providing merchandising services to a variety of
manufacturers in the industry. Until 1989, PIA operated exclusively in grocery
retail chains in California and Arizona. In 1990, PIA implemented a national
expansion strategy to cover the grocery trade. In 1993, PIA expanded to address
additional retail channels, including mass merchandiser, chain drug and discount
drug stores. In 1994, PIA began offering dedicated services to retailers and
manufacturers. In 1997, PIA established a corporate and division infrastructure
for its project services business. PIA currently performs its services primarily
on behalf of approximately 805 consumer product manufacturers.

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INDUSTRY OVERVIEW

A number of trends have impacted the retail industry and have created a
demand for providers of third party merchandising services such as those offered
by PIA.

SHIFT OF MERCHANDISING SERVICES

Historically, employees of retailers, consumer product manufacturers and
food brokers principally performed merchandising functions. Retailers staffed
their stores as needed to ensure in-stock conditions, the placement of new items
on shelves, and the maintenance of shelf schematics to approved standards.
Manufacturers typically deployed their own sales people in an effort to ensure
that their products were in distribution and properly positioned on the shelves.
However, the primary function of these sales people was to sell the
manufacturers' products and promotions, and not to perform significant in-store
services at the shelf level. In addition, food brokers performed retail
merchandise services on behalf of the manufacturer in conjunction with their
sales efforts. Brokers also often performed work at the shelf level at the
request of the retailer and their principal client, the manufacturer.

The average grocery store carries approximately 22,000 items. In an effort
to maintain or improve their margins, grocery retailers have broadened their
product offerings and services from traditional grocery, household and health
and beauty care products to include new product categories such as general
merchandise and service departments such as bakery, deli and prepared fast
foods. PIA believes that, as a result, these retailers have shifted employee
hours away from the traditional maintenance of packaged goods in order to
support these new categories and service departments. PIA further believes
retailers have converted many hours of basic merchandising work from full-time
professionals to part-time labor, who are generally less skilled and trained.
These trends have caused poorer shelf conditions and an increasing number of
out-of-stock items, resulting in lost sales. As a result, retailers are
increasingly relying on manufacturers and food brokers, among others, to support
their in-store needs such as new store sets and existing store resets, re-
merchandising, remodels and category implementations. Initially, manufacturers
deployed their sales professionals to perform these retailer-mandated services.
However, manufacturers found the deployment of sales professionals to perform
retail-merchandising services were expensive and not an effective use of their
resources. As manufacturers' costs to perform these services grew and shelf
integrity declined, manufacturers began to outsource these merchandising
activities to third parties such as PIA.

The outsourcing trend to third party merchandisers has resulted in an
increasing number of organizations providing services to manufacturers and
retailers. Certain retailers and manufacturers have chosen to consolidate in
order to reduce the number of third parties they have to manage, to achieve
consistent execution of their retail merchandising strategies, and to customize
the scope of services performed on their behalf.

RETAILER CONSOLIDATION

As retailer-mandated activities have continued to increase in both number
and type, with a corresponding increase in the amount of labor required to
complete them, manufacturers have increased their use of third party suppliers.
For example, additional category implementation activities are required to
effect retailers' in-store schematics. Schematics are changing more frequently
as the result of a growing number of new product introductions each year.
Retailers continue to require numerous resets, re-merchandising, and remodels in
response to the increasing number of changes in the product mix. PIA estimates
that these activities have doubled over the last five years, so that most stores
are currently re-merchandised or remodeled every 24 months. In certain areas of
the country and with certain retailers, these activities are conducted annually.

INCREASE IN MERCHANDISING SERVICES REQUIRED IN OTHER RETAIL CHANNELS

Unlike the merchandising services performed for grocery retailers, work
performed by manufacturers in mass merchandiser, chain drug and other retail
formats has historically been much less demanding. In these retail channels,
retailers performed most of their own merchandising work. However, PIA believes
that as these retailers become more competitive, they are attempting to maintain
their margins by requesting more support from the manufacturer community to
provide merchandising services similar to those provided to the grocery
retailers. These retailers have become increasingly important to manufacturers,
causing manufacturers to provide greater retail focus and support to ensure
out-of-stock conditions are reduced, authorized items are
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available, and general product conditions are good. Manufacturers have become
particularly sensitive to the requirements of seasonal and promotional
activities, which require rapid and effective in-store support in order to
maximize sales.

INCREASE IN USE OF INFORMATION TECHNOLOGIES

Information technology is playing an increasingly important role in the
retail industry, particularly in light of industry initiatives towards efficient
consumer response ("ECR") and category management. Retailers and manufacturers
have expanded their use of information technology to manage product distribution
in stores, item placements on the shelves, and off-shelf displays. In
particular, retailers and manufacturers are increasingly looking for causal data
(e.g., display, pricing and product adjacency information) that is category and
store specific. Both retailers and manufacturers use this information to make
decisions regarding ECR category management, shelf management, and new product
promotion plans. It also gives retailers the ability to tailor their stores to
regional demographics.

BUSINESS STRATEGY

PIA believes the increasing demand for national solutions to manufacturers'
diverse merchandising requirements, together with the consolidation of the
retail industry, has increased the growth of outsourcing. The increase in
required merchandising services, and the increased use of information
technology, will foster the growth of those companies that can provide these
solutions, have the flexibility to respond to the changing retail environment
and have the financial resources to provide rapid deployment of merchandising
resources. PIA has developed a strategy it believes will address these industry
trends. The major components of PIA's strategy are as follows:

POSITION PIA AS A NATIONAL, FULL SERVICE RETAIL SOLUTIONS COMPANY

PIA's objective is to strengthen its position as a leading national
supplier of retail solutions by expanding the services it will offer including
category management, data gathering, interpretation and management, to both its
existing and prospective manufacturer clients and its newer and prospective
retailer clients, and to offer its existing and newer services in additional
retail channels.

SERVE EMERGING DEMAND FOR DEDICATED SERVICES

PIA believes certain retailers and manufacturers will increasingly prefer
merchandising service on a dedicated basis, and the significant size of such
contracts requires substantial financial, recruitment, deployment, reporting and
management capabilities. PIA believes it is well positioned to serve this
emerging need for dedicated services.

INCREASE PIA'S UTILIZATION OF INFORMATION TECHNOLOGY

PIA has been focusing information technology resources on applications
which help improve productivity of field merchandisers. PIA believes a
commitment to technology will provide a long term competitive advantage. PIA
believes the technology it develops will present increased opportunities for PIA
on project specific requests from manufacturers. PIA also expects to use
technology to expand its informational services and consulting capabilities.
Additionally, PIA will continue to provide its proprietary software program,
Merchandisers Toolbox, to certain retailers. This program is designed to manage
the deployment of manufacturer supplied labor, to measure their performance
against the retailers' in-store plans and to develop databases that include a
"blueprint" of a store by category. PIA also expects that its key account
managers will continue to use various shelf technology programs which PIA
licenses from A.C. Nielsen, IRI and Intactix.

DESCRIPTION OF SERVICES

PIA provides a broad array of merchandising services on a national,
regional and local basis to manufacturers and retailers. PIA believes its
full-line capability of developing plans at one centralized headquarters
location, executing chain wide, fully integrated national solutions and
implementing rapid, coordinated responses to needs on a real time basis
differentiates PIA from its competitors. PIA also believes
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its centralized decision-making ability, local follow-through, ability to
recruit, train and supervise merchandisers, ability to perform large-scale
initiatives on short notice and strong retailer relationships provide it with a
competitive advantage over local, regional or retailer specific competitors.

PIA provides its merchandising and sales services primarily on behalf of
consumer product manufacturers at approximately 17,000 retail grocery, 6,000
mass merchandiser and 8,800 drug stores. PIA currently provides three principal
types of merchandising and sales services: shared services, dedicated services
and project services.

SHARED SERVICES

Shared services consist of regularly scheduled, routed merchandising
services provided at the store level for manufacturers. PIA's shared services
are performed for multiple manufacturers including, in some cases, manufacturers
whose products are in the same product category. Shared services may include
activities such as:

- Ensuring that client's products authorized for distribution are in stock
and on the shelf;

- Adding in new products that are approved for distribution but not present
on the shelf;

- Setting category shelves in accordance with approved store schematics;

- Ensuring that shelf tags are in place;

- Checking for the overall salability of clients' products; and

- Selling new product and promotional items.

PIA's shared services are performed principally by full-time retail sales
merchandisers, retail sales specialists and key account managers, along with
district and division manager supervision.

RETAIL SALES MERCHANDISERS

PIA's retail sales merchandisers ("RSM") perform shared service coverage at
the store level. These services include a review of the retailer's shelves and
the appropriate store (or chain) prepared shelf schematic to ensure all clients'
approved products are available for sale in the store, that such products have
the approved shelf placement and number of facings (the horizontal and vertical
space occupied by a package front) on the shelf, and the approved shelf tag is
in position. If a product is not in distribution, the RSM adds the product to
the shelf if it is available in the store's product storage area. If a product
is unavailable, the RSM prepares a place on the shelf for this product and a
shelf tag. The presence of a shelf tag is critical to a store's ability to
reorder an individual stock-keeping unit ("SKU") from the distribution center.
The RSM checks for the presence of and replaces, if necessary, the shelf tags
for all client SKUs. The RSM also reviews all SKUs for product freshness, if
appropriate, and for general salability.

KEY ACCOUNT MANAGERS

On behalf of its manufacturer clients, PIA selectively deploys key account
managers ("KAMs") inside of the major retail chains. These KAMs, assigned
exclusively to a single retailer, work with that retailer's headquarters staff
in the execution of category management initiatives and in the development and
implementation of shelf schematics. The KAMs provide both the manufacturer and
PIA with a headquarters' perspective of the retailer and its primary objectives
at the store level. The KAMs work with manufacturer clients to develop and
achieve their merchandising goals, including those related to product
distribution, shelf placement, the number of facings for particular products,
and product adjacencies. The KAMs also work with manufacturer clients to gain
retailer authorization for new products and approval of new category schematics
that are compatible with the retailer's own category management strategies. PIA
generally attempts to position its KAMs within the retailer's organization in a
leadership capacity, both in category management and vendor deployment
activities. The KAMs typically are placed within the retailer's shelf technology
department and are equipped with the specific shelf technology software utilized
by the retailer. The KAMs work with the retailer in the development of new shelf
schematics, category layouts and, in some cases, total

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store space plans. PIA is also training its KAMs in category management in order
to provide further value to both PIA's manufacturer clients and to the retailer.

DEDICATED SERVICES

Dedicated services consist of merchandising services, generally as
described above, that are performed for a specific retailer or manufacturer by a
dedicated organization, including a management team, working exclusively for
that retailer or manufacturer. These services provided are primarily based on
agreed hourly rates and fixed management fees under multi-year contracts.

PIA believes it pioneered the concept of dedicated service in 1994 with a
program designed for Thrifty-PayLess Drug Stores. The program covered 995
stores, and PIA was responsible for implementing product selection changes and
resetting all categories to meet Thrifty-PayLess' category management plans. In
implementing the program, PIA was able to ensure placement of new products on
the shelf within five days of availability and completed section changes within
ten days. In 1996, Rite Aid acquired Thrifty-PayLess and the contract was not
renewed beyond December 1996.

In 1997, PIA started a dedicated program with CVS/Revco to convert Revco
stores to the CVS format. The conversion project was a total re-merchandising of
all Revco stores to the new CVS format. PIA moved gondolas, built new gondolas,
and installed new fixtures and re-planogramed all categories to the CVS
conversion plan. In 1999, PIA will be responsible for new store set ups and
special projects for CVS/Revco in the state of Ohio.

PIA has not expanded the dedicated service concept during fiscal year 1998.
Net revenues have decreased from 34.6% in 1997 to 31.9% in 1998, primarily due
to project completions of the CVS/Revco conversions.

PROJECT SERVICES

Project services consist primarily of specific in-store services initiated
by retailers and manufacturers, such as new product launches, special seasonal
or promotional merchandising, focused product support and product recalls. These
services are used typically for large-scale implementations over 30 days. PIA
also performs other project services, such as new store sets and existing store
resets, re-merchandising, remodels and category implementations, under shared
service contracts or stand-alone project contracts.

RELATED SERVICES

INFORMATION TECHNOLOGY SERVICES

PIA has been focusing information systems resources on applications, which
help improve productivity of field merchandisers. The Labor Tracking System
("LTS") was introduced to PIA's 12 service centers in 1998. This proprietary
application records actual time spent on each work initiative. The benefits of
the system include real-time reporting, improved client billing, and more
efficient management of the field labor.

In August 1998, the Work Generator System was implemented. This system
schedules shared services and project work from a central system. It reduces the
travel time by coordinating shared service work with project work. The system
provides associates with a daily schedule of work assignments and expected
completion times.

In September 1998, PIA began using Symbol scanners to capture inventory and
returned inventory data for Buena Vista Home Entertainment ("BVHE"). BVHE
retrieves the scanner information daily via the Internet from PIA's server. This
information is used for daily updates to BVHE's vendor managed inventory system.

PIA also expanded the use of its Interactive Voice Response ("IVR") system.
Hourly status updates can now be provided to clients on critical new item
launches, such as BVHE's video releases. The IVR system can process 2,500 calls
per day. This gives PIA the ability to give clients up-to-the-minute status on
any work that uses the IVR system.

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TELEMARKETING SERVICES

PIA owns 20% of Ameritel, Inc., a company that performs inbound and
outbound telemarketing services, including those on behalf of certain of PIA's
manufacturer clients. Ameritel provides telemarketing sales services for
manufacturers that sell directly into smaller, independent retail stores. PIA
believes that its affiliation with Ameritel provides an additional merchandising
solution for some packaged product manufacturers and retailer clients. PIA, in
conjunction with Ameritel, developed an automated interface between the Ameritel
Vantive system and the LTS. PIA associates now telephone work assignment
completion information to Ameritel. PIA associates are able to report hours,
mileage, and other completion information for each work assignment on a daily
basis. The information is used to update the LTS the next day. This provides the
12 service centers with daily, detailed tracking of work completion.

RETAIL AND SECONDARY HEADQUARTERS SELLING SERVICES

PIA deploys retail sales specialists ("RSS") to provide product selling
support for certain manufacturers at the retail store and secondary retailer's
headquarters buying offices. These services are performed principally for
manufacturers that choose to outsource their sales function for calls on
wholesaler-supplied individual stores or small chains. Sales services performed
by the RSS include product sales, selling point of sale promotions, discount and
allowance programs and shelf merchandising plans.

SALES AND MARKETING

PIA's sales efforts are structured to develop new business in national and
local markets. At the national level, PIA's corporate business development team
directs its efforts toward the senior management of prospective clients. At the
regional level, sales efforts are principally guided through PIA's 12 service
center offices located nationwide.

PIA's corporate account executives play an important role in PIA's new
business development efforts within its existing manufacturer client base. The
corporate account executives are generally located in the clients' corporate
headquarters. The corporate account executives plan merchandising and product
introductions with the manufacturer so that PIA can achieve the objectives of
such clients' major new product and promotional initiatives. In addition, the
corporate account executives present PIA's services to the sales and marketing
executives of these clients, and utilize marketing data provided by IRI, A.C.
Nielsen and others in an effort to ascertain additional market opportunities for
such clients at the local level. Client service managers are part of PIA's
geographic division teams and work with the local management of PIA's clients.
The client service manager's primary responsibility is to work with the client
to establish specific, measurable objectives for PIA, and to market additional
services. As part of this process, the division account executive is responsible
for developing retail merchandising solutions for such objectives.

As part of retailer consolidation, retailers are centralizing most
administrative functions, including operations, procurement and category
management. In response to this centralization and the growing importance of
large retailers, many manufacturers have reorganized their selling organizations
around a retailer team concept that focuses on a particular retailer. PIA has
also responded to this emerging trend by establishing client service offices
that are fully staffed to provide the PIA client and the retailer with access to
all of PIA's services. PIA currently has retailer teams in place at three
discount and drug stores.

PIA's business development process encompasses a due diligence period to
determine the objectives of the prospective client, the work to be performed to
satisfy those objectives and the market value of the work to be performed. PIA
employs a formal cost development and proposal process that determines the cost
of each element of work required to achieve the prospective client's objectives.
These costs, together with an analysis of market rates, are used in the
development of a quotation approval form that is presented to PIA's proposal
committee for approval. The pricing must meet PIA's objectives for
profitability, which are established as part of the business planning process.
After approval of this quotation by the proposal committee, a detailed proposal
is presented to the prospective client. Following agreement regarding the
elements of service and corresponding rates, a contract is prepared and
executed. See "-- Customers."

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CUSTOMERS

PIA currently represents approximately 805 manufacturer clients, including
approximately 648 branded product manufacturers and approximately 157 private
label manufacturers. Before 1993, PIA represented its manufacturer clients
primarily in the retail grocery industry. Beginning in 1993, PIA found that
additional opportunities to provide its services existed throughout the much
broader marketplace. This marketplace included mass merchandiser, chain drug and
deep discount drug stores, as well as other retail trade groups such as home
improvement centers, computer/electronic stores, toy stores, convenience stores
and office supply stores. As a result, PIA has contracted with a number of
manufacturers to provide services in several additional retail markets, and has
agreed to provide services to a number of retailers directly.

COMPETITION

The third-party merchandising industry is highly competitive and is
comprised of an increasing number of merchandising companies with either
specific retailer, retail channel or geographic coverage, as well as food
brokers. Based on information posted on the website of the National Association
for Retail Merchandising Services, PIA believes there are over 150 competitors
in the field of merchandising services. These companies tend to compete with PIA
primarily in the retail grocery channel, and some of them may have a greater
presence in certain of the retailers in whose stores PIA performs its services.
PIA also competes with several companies that are national in scope, such as
Powerforce, Alpha One and Pimms. These companies compete with PIA principally in
the mass merchandiser, chain drug and deep discount drug retail channels. PIA
believes the principal competitive factors within its industry include
development of technology breadth and quality of client services, cost, and the
ability to execute specific client priorities rapidly and consistently over a
wide geographic area.

TRADEMARKS

PIA(R) is a registered trademark of PIA. In addition, PIA has recently
commenced the process of registering the service mark for the term Precision
Merchandising. Although PIA believes its trademarks may have value, PIA believes
its services are sold primarily based on breadth and quality of service, cost,
and the ability to execute specific client priorities rapidly and consistently
over a wide geographic area. See "-- Competition."

EMPLOYEES

As of January 1, 1999, PIA employed approximately 1,109 full-time
employees, of whom approximately 83 worked in executive, administrative and
clerical capacities at PIA's corporate headquarters, and 1,026 of whom worked in
division offices nationwide. In addition, PIA employed 1,030 part-time
employees. Approximately 180 of PIA's employees are covered by contracts with
labor unions. PIA considers its relations with its employees and its employees'
unions to be good. PIA also uses the services of up to 3,000 flextime personnel
whose payroll is generated through a company not affiliated with PIA.

PROPERTIES

PIA maintains its corporate headquarters in approximately 20,000 square
feet of leased office space located in Irvine, California, under a lease with a
term expiring in February 2000.

PIA leases certain office and storage facilities for its divisions and
subsidiaries under operating leases, which expire at various dates during the
next five years. Most of these leases require PIA to pay minimum rents, subject
to periodic adjustments, plus other charges including utilities, real estate
taxes and common area maintenance.

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The following is a list of the locations where PIA maintains leased
facilities for its division offices and subsidiaries:

Scottsdale, Arizona                    Southfield, Michigan
Rogers, Arkansas                       Chesterfield, Missouri
Irvine, California                     Edison, New Jersey
Pleasanton, California                 Blue Ash, Ohio
Englewood, Colorado                    Cranberry Township, Pennsylvania
Tampa, Florida                         Carrollton, Texas
Norcross, Georgia                      Houston, Texas
Oakwood Terrace, Illinois              Bellevue, Washington
Woburn, Massachusetts

Although PIA believes that its existing facilities are adequate for its
current business, new facilities may be added should the need arise in the
future. Certain of the above facilities may be closed or subleased as PIA
streamlines its operations.

LEGAL PROCEEDINGS

On February 25, 1998, PIA and its Canadian subsidiary were served with two
Statements of Claim in the Ontario court (General Division) of the Province of
Ontario, Canada, filed by Merchandising Consultants Associates ("MCA") asserting
claims for alleged breach of Confidentiality Agreements dated October 19, 1996
and July 17, 1997. Both of these lawsuits assert that PIA and its subsidiary
improperly used confidential information provided by MCA as part of PIA's due
diligence concerning its proposed acquisition of MCA, including alleged
clientele, contracts, financial statements and business opportunities of MCA. In
addition, MCA contends that PIA breached and allegedly reneged upon the terms
for acquisition of MCA contained in a Letter of Intent between the parties dated
July 17, 1997, which by its express terms was non-binding. The Statements of
Claim sought damages totaling $10.2 million.

PIA has agreed to settle the MCA lawsuit. Both parties have agreed to drop
the lawsuit for no compensation and to execute a Full and Final Release,
releasing each other from all claims.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF PIA

The following discussion and analysis of financial condition and results of
operations contains statements that constitute forward-looking statements. Such
forward-looking statements relate to future events or the future financial
performance of PIA and involve known and unknown risks, uncertainties and other
factors that may cause the actual results, performance or achievements of PIA to
be materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Such factors include,
among other things, the following: general economic and business conditions;
PIA's dependence on the trend toward outsourcing; uncertainty regarding and
changes in customer preferences; competition; changes in political, social and
economic conditions; and various other factors beyond PIA's control. Each holder
of PIA Common Stock should specifically consider the various factors identified
in this Proxy Statement including the matters set forth under "Risk Factors,"
which could cause actual results to differ materially from those indicated by
such forward-looking statements. PIA undertakes no obligation to publicly update
or revise any forward-looking statements, whether as a result of new
information, future events or otherwise. In light of these risks and
uncertainties, there can be no assurance that the forward-looking information
contained in this Proxy Statement will in fact transpire. The following
discussion should be read in conjunction with PIA's Consolidated Financial
Statements and the related Notes thereto, included elsewhere in this Proxy
Statement.

OVERVIEW

PIA provides merchandising services to manufacturers and retailers
principally in grocery, mass merchandiser and chain and discount drug stores.
For the quarter ended April 2, 1999, compared to the quarter ended April 3,
1998, PIA generated approximately 67.2% and 64.5% of its net revenues from
manufacturer clients and 32.8% and 25.5% from retailer clients, respectively.
For the years ended December 31, 1997, and January 1, 1999, PIA generated
approximately 74% and 59% of its net revenues from manufacturer clients and 26%
and 41% from retailer clients, respectively.

During the five years that ended January 1, 1999, none of PIA's
manufacturer or retailer clients accounted for greater than 10% of PIA's net
revenues, other than Thrifty-Payless, which accounted for approximately 13% of
net revenues for the year ended December 31, 1995, and BVHE and S.C. Johnson
which accounted for 11.7% and 10.3% of net revenues, respectively, for the year
ended December 31, 1996, and BVHE and Eckerd Drug Stores which accounted for
approximately 16.0% and 13.6% respectively, of net revenues for the year ended
December 31, 1997, and Eckerd Drug Stores, CVS Pharmacy, and BVHE which
accounted for approximately 15.6%, 12.6%, and 10.6% respectively, of net
revenues for the year ended January 1, 1999.

During fiscal year 1998, PIA continued to experience a decline in its
shared services business. Shared services consist of regularly scheduled, routed
merchandising services provided at the store level for manufacturers, primarily
under multi-year contracts. Due in part to industry consolidation, increased
competition, and performance issues, PIA lost a number of shared service clients
in the last half of 1996, which has continued through the three months ended
April 2, 1999. PIA has historically required a significant fixed management and
personnel infrastructure to support shared services. Accordingly, the loss of
shared services business, without offsetting gains, had a material adverse
effect on PIA's results of operations in fiscal 1997, fiscal 1998 and the three
months ended April 2, 1999. These losses have been partially offset with
additional project revenue from shared service clients. For fiscal 1997, fiscal
1998 and the three months ended April 2, 1999, shared service and project
client's accounted for $83.8, $83.0 and $15.9 million in net revenue and
dedicated clients accounted for $44.4 and $38.8 and $5.7 million in net revenue,
respectively. PIA believes revenues in fiscal year 1999 from shared service
clients will decline as a result of the wind-down of the lost business.

PIA's profitability has been adversely affected by the loss of its
dedicated client services business in 1998. However, this decline was offset by
an increase in gross margin from fiscal 1997 to fiscal 1998, both in absolute
amount and as a percentage of net revenues, as a result of the effects of
improved labor productivity and service cost reduction in the field. Dedicated
services consist of merchandising services that are performed for a specific
retailer or manufacturer by a dedicated organization, including a management
team, working

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exclusively for that retailer or manufacturer. The net revenues associated with
dedicated clients decreased as a percentage of overall net revenues, from 34.6%
in fiscal 1997 to 31.9% in fiscal 1998 and from 31.1% in the three months ended
April 3, 1998 to 26.9% in the three months ended April 2, 1999. PIA currently
anticipates that revenue for the second quarter of 1999 will be lower than the
first quarter of 1999 and the comparable prior year period, due to the scheduled
completion of several projects, the annualized effect of business lost over the
last 18 months and the impact of PIA's internal focus on restructuring
operations.

Due to the change in business mix, and resulting negative impact on
margins, PIA realigned its cost structure, and, in the third quarter of 1997,
recorded a charge of $5.4 million for restructuring and other costs associated
with the realignment of management structure and the organization. PIA continues
to review its organizational structure and the fixed and variable costs
associated with delivery of its services. During 1998, PIA restructured its
operations to address the significant fixed management infrastructure and
rationalize the field organization. The restructuring resulted in a field
organization that is aligned along functional lines of selling and execution. In
addition, PIA believes new scheduled deployment, labor tracking, and work
generation systems now in place will continue to have a beneficial impact on
managing the direct labor costs. It is anticipated that further organizational
changes will take place in fiscal year 1999, as PIA puts structure, programs and
processes in place to reduce its fixed overhead in line with lower revenue
levels. The following table sets forth certain financial data as a percentage of
net revenues for the periods indicated:

THREE MONTHS
YEARS ENDED                     ENDED
----------------------------------------   ------------
DECEMBER 31,   DECEMBER 31,   JANUARY 1,     APRIL 2,
1996           1997          1999          1999
------------   ------------   ----------   ------------

Net revenues....................................     100.0%         100.0%        100.0%        100.0%
Operating expenses:
Field services costs..........................      79.1           93.5          86.6          92.8
Selling expenses..............................       9.3            8.2           6.8           7.2
General and administrative expenses...........       6.7            8.0           9.7          14.4
Restructure and other charges.................       0.0            4.2           0.0            --
Depreciation and amortization.................       0.5            0.8           0.9           1.3
-----          -----         -----         -----
Total operating expenses...................      95.6          114.7         104.0         115.7
-----          -----         -----         -----
Operating income (loss).........................       4.4          (14.7)         (4.0)        (15.7)
Other income....................................       0.8            0.7           0.5           0.4
-----          -----         -----         -----
Income (loss) before provision (benefit) for
income taxes..................................       5.2          (14.0)         (3.5)        (15.3)
Provision (benefit) for income taxes............       2.0           (2.2)           --            --
-----          -----         -----         -----
Net income (loss)...............................       3.2%         (11.8)%        (3.5)%       (15.3)%
=====          =====         =====

RESULTS OF OPERATIONS

PIA's quarterly results of operations are subject to certain variability
related to the timing of retailer-mandated activity and the receipt of
commissions. Retailer-mandated activity is typically higher in the second and
third quarters of the year due to retailer scheduling of activity in off-peak
shopping periods. In addition, new product introductions increase during such
periods which requires the reset of categories as the new products gain
distribution. In the dedicated services business, PIA provides each manufacturer
or retailer client with an organization, including a management team, which
works exclusively for that client.

The amount of commissions earned by PIA under its commission-based
contracts, typically averaging 13% to 19% of total net revenues, varies
seasonally, and generally corresponds to the peak selling seasons of the clients
that have entered into these types of contracts. Historically, PIA has
recognized greater commission income in the second and fourth quarters. See
"Risk Factors -- PIA's Operating Results May Fluctuate Because Its Commission
Income is Uncertain."

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THREE MONTHS ENDED APRIL 2, 1999 COMPARED TO THREE MONTHS ENDED APRIL 3, 1998

NET REVENUES

Net revenues for the quarter ended April 2, 1999 decreased from the
comparable period of 1998 due principally to a decrease in all of PIA's major
business segments. For the first quarter of 1999, net revenues were $21.6
million compared to $34.7 million in the first quarter of 1998, a 37.8%
decrease.

The following table sets forth net revenues by client type as a percentage
of net revenues for the periods indicated:

QUARTER ENDED
--------------------------------------------
APRIL 3, 1998      APRIL 2, 1999     CHANGE
---------------    ---------------    ------
AMOUNT      %      AMOUNT      %        %
(AMOUNTS IN MILLIONS)                ------    -----    ------    -----    ------

Shared service client net revenues...............  $12.0      34.6%   $ 8.3      38.4%   (30.8)%
Project client net revenue.......................   12.4      35.7      7.6      35.2    (38.7)
Dedicated client net revenues....................   10.3      29.7      5.7      26.4    (44.7)
-----     -----    -----     -----    -----
Net Revenue....................................  $34.7     100.0%   $21.6     100.0%   (37.8)%
=====     =====    =====     =====    =====

PIA's dedicated client net revenues have declined from $10.3 million in the
first quarter of 1998 to $5.7 million in the first quarter of 1999, a 44.7%
decrease. The decrease in dedicated client net revenues for the first quarter of
1999 compared to the first quarter of 1998 resulted primarily from the
completion of a major drug chain's dedicated program in the fourth quarter of
1998. Management expects that net revenues from dedicated clients will decrease
in 1999 due to the completion of a $15.0 million project in the last quarter of
1998.

Shared service client net revenues decreased from $12.0 million in the
first quarter of 1998 to $8.3 million in the first quarter of 1999, a 30.8%
decrease due to the loss of clients in the first six months of 1998. Shared
service client net revenue increased as a percentage of net revenue by 3.8%.

Project client net revenues have decreased from $12.4 million in the first
quarter of 1998 to $7.6 million in the first quarter of 1999, a 38.7%, decrease
due to the reduction in project revenue from lost shared service clients and
reduced levels of new business.

The decrease in shared service and project client net revenues for the
first quarter of 1999 compared to the first quarter of 1998 resulted from a
decrease in revenue of $12.5 million from clients no longer with PIA, offset
partially by an increase in revenue from new clients of $2.0 million, and by an
increase in revenue from existing shared service and project client accounts of
$2.4 million.

OPERATING EXPENSES

The following table sets forth the operating expenses as a percentage of
net revenues for the periods indicated:

QUARTER ENDED
--------------------------------------------
APRIL 3, 1998      APRIL 2, 1999     CHANGE
---------------    ---------------    ------
AMOUNT      %      AMOUNT      %        %
(AMOUNTS IN MILLIONS)                ------    -----    ------    -----    ------

Field service costs..............................  $29.8      85.8%   $20.1      93.1%   (32.6)%
Selling expenses.................................    2.3       6.6      1.5       6.9    (34.8)
General & administrative expenses................    3.5      10.2      3.1      14.4    (11.4)
Depreciation & amortization......................    0.3       0.9      0.3       1.3     (0.0)
-----     -----    -----     -----    -----
Total Operating Expenses...............  $35.9     103.5%   $25.0     115.7%   (30.4)%
=====     =====    =====     =====    =====

For the first quarter of 1999, field service costs decreased $9.7 million,
or 32.6%, to $20.1 million, as compared to $29.8 million in the first quarter of
1998. Field service costs are comprised principally of field labor and related
costs and overhead expenses required to provide services to both shared and
dedicated service clients.

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As a percentage of net revenues, field service costs in the first quarter
of 1999 increased to 93.1% from 85.8% in the same period last year. The increase
in field service costs as a percentage of net revenues in the first quarter of
1999 was due primarily to the fixed cost component of field service costs.
However, total field service costs decreased by $9.7 million due to both
declining net revenues and more efficient field deployment.

For the quarter ended April 2, 1999, selling expenses decreased $0.8
million, or 34.8%, to $1.5 million compared to $2.3 million in the same period
last year. This decrease in costs was a result of a reduction in salaries and
related expenses resulting from a reduction in personnel. As a percentage of net
revenues, selling expenses increased to 6.9% in the first quarter of 1999,
compared to 6.6% in the first quarter of 1998.

General and administrative expenses decreased 11.4% in the first quarter of
1999 to $3.1 million, compared to $3.5 million in the same period of 1998. The
decrease in general and administrative costs was due primarily to incentive
liabilities recorded in the first two quarters of 1998 and salary and wage staff
reductions during the quarter ended April 2, 1999. This decrease was partially
offset by a charge for certain severance costs of $0.5 million and pre-merger
transaction costs of $0.3 million.

OTHER INCOME

Interest income decreased in the first quarter of 1999, as compared to the
first quarter of 1998, due to lower cash balances available for investment in
the first quarter of 1999.

Interest expense increased in the first quarter of 1999 due to borrowing on
the bank revolving line of credit.

Equity in earnings of affiliate represents PIA's share of the earnings of
Ameritel, Inc., a full service telemarketing company.

INCOME TAXES

The income tax provision in the first quarters of 1999 and 1998 represent
minimum state and local taxes.

NET LOSS

PIA incurred a net loss of $3.3 million in the first quarter of 1999 or
$0.61 per basic and diluted share compared to a net loss of approximately $1.0
million, or $0.19 per basic and diluted share, in the first quarter of 1998. The
loss in the first quarter of 1999 was primarily a result of a reduction in
shared service and project client net revenues partially offset by a reduction
in field service costs and a reduction in selling and general and administrative
costs.

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FINANCIAL MODEL

PIA developed a financial model to assist in the understanding of the
operating results and impact of various cost functions within the organization.
This model follows more standard metrics and allows PIA to analyze and manage at
the business unit level. The following table illustrates this financial model
for the quarters ended April 3, 1998 and April 2, 1999.

QUARTER ENDED
----------------------------------
APRIL 3, 1998      APRIL 2, 1999
---------------    ---------------
AMOUNT      %      AMOUNT      %
------    -----    ------    -----
(AMOUNTS IN MILLIONS)

Net revenues..............................................  $34.7     100.0%   $21.6     100.0%
Direct business unit field expense........................   25.6      73.8     16.4      75.8
-----     -----    -----     -----
Gross Margin....................................    9.1      26.2      5.2      24.2
Overhead and Allocated Field Expense......................    6.0      17.3      4.0      18.7
-----     -----    -----     -----
Business Unit Margin............................    3.1       8.9      1.2       5.5
Selling, General and Administrative Expenses..............    4.0      11.5      4.3      19.9
-----     -----    -----     -----
Earnings (loss) before interest, taxes, depreciation and
amortization (EBITDA)...................................  $(0.9)     (2.6)%  $(3.1)    (14.4)%
=====     =====    =====     =====

Management expects to continue to review the business results on the basis
of the comparable financial statement format contained in this Proxy Statement.

Certain amounts within the financial model have been reclassified in prior
periods in order to conform to the current period's presentation.

YEAR ENDED JANUARY 1, 1999 COMPARED TO YEAR ENDED DECEMBER 31, 1997

NET REVENUES

For fiscal year 1998, net revenues were $121.8 million, compared to $128.2
million in 1997, a 5.0% decrease. Shared service and project client net revenues
decreased from $83.8 million in 1997 to $83.0 million in 1998, a decrease of
$0.8 million or 1.0%. Traditional shared services revenues decreased from $44.9
million in 1997 to $40.1 million in fiscal 1998. This decrease of $4.8 million
or 10.7% was due in part to industry consolidation, increased competition and
client reorganization of marketing strategy. During the same period project
revenues for shared service clients increased by $4.0 million or 10.3% primarily
due to a major client switching from a dedicated program to a shared service
program. PIA's dedicated client net revenues declined from $44.4 million in 1997
to $38.8 million in 1998, representing a 12.6% decrease. This decrease in
dedicated client net revenues resulted primarily from the completion of a major
drug chain dedicated program. Management expects that net revenues from
dedicated clients will decrease in 1999 due to the completion of a $15.0 million
project in the last quarter of 1998.

The following table sets forth net revenues by client type as a percentage
of net revenues for the periods indicated:

YEARS ENDED
------------------------------------------------
DECEMBER 31,      JANUARY 1,
1997             1999            CHANGE
--------------   --------------   --------------
AMOUNT     %     AMOUNT     %     AMOUNT     %
------   -----   ------   -----   ------   -----
(DOLLARS IN MILLIONS)

Shared service and project client net
revenues......................................  $ 83.8    65.4%  $ 83.0    68.1%  $(0.8)    (1.0)%
Dedicated client net revenues...................    44.4    34.6     38.8    31.9    (5.6)   (12.6)
------   -----   ------   -----   -----    -----
Net revenues....................................  $128.2   100.0%  $121.8   100.0%  $(6.4)    (5.0)%
======   =====   ======   =====   =====    =====

OPERATING EXPENSES

Field service costs were $105.4 million in fiscal year 1998 compared to
$119.8 million in 1997, representing a decrease of $14.4 million, or 12.0%. As a
percentage of net revenues, field service costs were 93.5% of net revenues in
1997 versus 86.6% of net revenues in 1998. Field service costs are comprised

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principally of field labor and related costs and overhead expenses required to
provide services to both dedicated and shared service clients. The decrease in
field service costs was primarily due to significant labor efficiency savings
from new labor deployment systems and controls and a decline in services due to
the completion of a dedicated project in the third quarter 1998.

Selling expenses were $8.2 million in 1998, compared to $10.5 million in
the prior year. As a percentage of net revenues, selling expenses were 6.8% in
1998, compared to 8.2% in 1997. This decrease in costs, both in absolute amount
and as a percentage of net revenues, is a result of lower staffing and travel
expenses.

General and administrative expenses increased 15.2% in 1998 to $11.8
million, compared to $10.2 million in 1997. This increase was due primarily to
consulting and promotional expenses of $1.0 million, salary and salary related
expenses of $0.5 million to support technology advancements, office equipment
and leases of $0.7 million, offset by a reduction in bad debt provision of $0.8
million due to improved collection of outstanding accounts.

Restructuring and other charge payments of $5.0 million did not
significantly differ from the initial restructuring and other charges expense.
In addition, accrued liabilities for restructuring at January 1, 1999 of $0.4
million will be sufficient to pay remaining employee separation costs and
special computer equipment under long-term operating leases no longer in use.
(See Note 12 to PIA's Consolidated Financial Statements contained elsewhere
herein).

Depreciation and amortization expenses were $1.1 million in 1998 compared
to $1.0 million in 1997, an increase of $0.1 million as a result of
depreciation, amortization on computer hardware, software development costs for
shelf technology and for general business purposes.

OTHER INCOME

Interest income decreased 42.2% or $0.3 million in 1998 compared to 1997,
due to lower cash balances available for investment in 1998.

Equity in earnings of affiliate represents PIA's share of the earnings of
Ameritel, Inc., a full service telemarketing company. Equity of earnings of
affiliate increased 55.2% or 0.1 million in 1998 compared to 1997. During 1996,
PIA exercised its option to increase its ownership of Ameritel to 20% and is now
required for financial reporting purposes to recognize its equity interest in
Ameritel's earnings.

INCOME TAXES

Income tax expense was approximately $0.1 million in 1998, compared to an
income tax benefit of $2.8 million in 1997, representing an effective rate of
1.3% and (15.5)%, respectively. The 1998 tax rate differed from the expected
federal tax rate of 35% due to a valuation allowance of $1.6 million on PIA's
deferred tax asset, caused by a net operating loss carryforward created in 1998
and the uncertainty over the future utilization of such carryforwards. An income
tax benefit in 1997 was derived from carrying back net operating losses to
previous years and obtaining an income tax refund of $2.9 million.

NET LOSS

PIA incurred a net loss of approximately $4.3 million in 1998, $0.78 per
diluted share, compared to a net loss of approximately $15.1 million, or $2.72
per diluted share, in 1997. The improved performance during 1998 was primarily
due to labor efficiency savings from utilizing new labor systems and controls,
reduction in field service costs from the implementation of the 1997 restructure
programs. The loss incurred in 1998 is primarily a result of margin reductions
because of reductions in dedicated clients and higher business unit overhead
rates.

FINANCIAL MODEL

The following table illustrates PIA's financial model described above for
the years ended December 31, 1997 and January 1, 1999.

Management expects to continue to review the business results based on the
comparable financial statement format contained in this Proxy Statement.
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YEARS ENDED
-------------------------------
DECEMBER 31,      JANUARY 1,
1997             1999
--------------   --------------
AMOUNT     %     AMOUNT     %
------   -----   ------   -----
(DOLLARS IN MILLIONS)

Net revenues................................................  $128.2   100.0%  $121.8   100.0%
Direct business unit field expense........................    98.7    77.0     88.9    73.0
------   -----   ------   -----
Gross margin................................................    29.5    23.0     32.9    27.0
Overhead and allocated field expense......................    26.6    20.7     20.8    17.1
------   -----   ------   -----
Business unit margin........................................     2.9     2.3     12.1     9.9
------   -----   ------   -----
Selling, general and administrative expenses..............    15.3    11.9     15.8    12.9
Restructure and non-recurring charges.....................     5.4     4.2      0.0     0.0
------   -----   ------   -----
Total selling, general and administrative expenses..........    20.7    16.1     15.8    12.9
------   -----   ------   -----
Earnings (loss) before interest, taxes, depreciation and
amortization (EBITDA).....................................   (17.8)  (13.8)    (3.7)   (3.0)
Depreciation and amortization.............................    (1.0)   (0.8)    (1.1)   (0.9)
Other income..............................................     0.9     0.7      0.6     0.5
Income tax benefit (provision)............................     2.8     2.1     (0.1)   (0.1)
------   -----   ------   -----
Net loss....................................................  $(15.1)  (11.8)% $ (4.3)   (3.5)%
======   =====   ======   =====

YEAR ENDED DECEMBER 31, 1997 COMPARED TO YEAR ENDED DECEMBER 31, 1996

NET REVENUES

For 1997, net revenues were $128.2 million, compared to $119.9 million in
1996, a 6.9% increase. PIA's dedicated client net revenues had grown from $21.9
million in 1996 to $44.4 million in 1997, a 102.7% increase. This increase in
dedicated client net revenues resulted from the addition of two major new
clients. Shared service and project client net revenues decreased from $98.0
million in 1996 to $83.8 million in 1997, a decrease of $14.2 million or 14.5%.
In 1997, the traditional shared services, consisting of regularly scheduled
routed merchandising services, decreased from $68.4 million in 1996 to $44.9
million in 1997. Resulting in a decrease of $23.5 million or 34.4%, while
project revenues for shared clients increased to $9.3 million or 31.4% The
following table sets forth net revenues by client type as a percentage of net
revenues for the periods indicated:

YEARS ENDED
-----------------------------------------------------
DECEMBER 31,       DECEMBER 31,
1996               1997              CHANGE
---------------    ---------------    ---------------
AMOUNT      %      AMOUNT      %      AMOUNT      %
------    -----    ------    -----    ------    -----
(DOLLARS IN MILLIONS)

Shared service and project client net
revenues............................    $ 98.0     81.7%   $ 83.8     65.4%   $(14.2)   (14.5)%
Dedicated client net revenues.........      21.9     18.3      44.4     34.6      22.5    102.7
------    -----    ------    -----    ------    -----
Net revenues..........................    $119.9    100.0%   $128.2    100.0%   $  8.3      6.9%
======    =====    ======    =====    ======    =====

OPERATING EXPENSES

In 1997, field service costs increased $25.0 million, or 26.3%, to $119.8
million, as compared to $94.8 million in 1996. As a percentage of net revenues,
field service costs were 79.1% of net revenues in 1996 versus 93.5% of net
revenues in 1997. Field service costs are comprised principally of field labor
and their related costs, and overhead expenses required to provide services to
both dedicated and shared service clients. The increase in field service costs
is due primarily to labor costs required to provide the necessary level of
business support for dedicated clients. In addition, PIA did not adequately
decrease shared client service labor and overhead costs as the net revenue from
this client base decreased.

Selling expenses were $10.5 million in 1997, compared to $11.1 million in
1996. As a percentage of net revenues, selling expenses were 8.2% in 1997,
compared to 9.3% in 1996. This decrease in costs, both in absolute amount and as
a percentage of net revenues, is a result of lower staffing and travels.

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General and administrative expenses increased 25.9% in 1997 to $10.2
million, compared to $8.1 million in 1996. The increase in general and
administrative expenses was due to increases in expenses that were required to
support overall business growth, including a larger dedicated client base. The
major increases included executive salaries and salary related expenses of $0.3
million, recruiting, employment and training of $0.3 million, and consulting,
legal and office lease expense of $0.6 million. In addition, increased costs
were experienced due to termination costs.

During 1997, PIA experienced declining gross margins, and resultant
operating losses, due to service performance issues and the loss of several
shared clients. This decline in margins has resulted in insufficient margin
dollars to cover the overhead structure, which had developed at the field level
and in the general corporate area. In the quarter ended September 30, 1997, PIA
began to address these conditions by restructuring its operations. PIA
redirected its focus in the quarter ended September 30, 1997, on a more
disciplined and functional structure. These strategies resulted in a $5.4
million charge for the restructuring and other additional charges. The
restructure and other charges consisted of $1.5 million of identified severance,
lease costs in various management and administrative functions and $2.1 million
in write-downs and accruals associated with the redirection of PIA's technology
strategies. Additional charges consist primarily of $1.3 million of reserves,
write-offs related to unprofitable contracts and $0.5 million of costs
associated with changes in PIA's service delivery model.

Depreciation and amortization expenses were $1.0 million in 1997 compared
to $0.6 million in 1996. The depreciation and amortization on computer hardware
and the software development costs for shelf technology increased this expense
$0.4 million.

OTHER INCOME

Interest income decreased slightly in 1997 compared to 1996, due to lower
cash balances available for investment in 1997. Other income included interest
income on the net proceeds from PIA's initial public offering, which took place
in March 1996.

Equity in earnings of affiliate represents PIA's share of the earnings of
Ameritel, Inc., a full service telemarketing company. Equity in earnings of
affiliate increased by 33.3% in 1997 compared to 1996. During 1996, PIA
exercised its option to increase its ownership of Ameritel to 20% and is now
required for financial reporting purposes to recognize its equity interest in
Ameritel earnings.

INCOME TAXES

Income tax benefit was approximately $2.8 million in 1997, compared to
income tax expense of $2.4 million in 1996, representing an effective rate of
(15.5%) and 39.2%, respectively. The 1997 tax benefit rates differed from the
expected Federal and tax rate of 35% due to a valuation allowance of $3.6
million on PIA's deferred tax asset, caused by a net operating loss carryforward
created in 1997.

NET LOSS

PIA incurred a net loss of approximately $15.1 million in 1997, $2.72 per
diluted share, compared to net income of approximately $3.8 million, or $0.63
per diluted share, in 1996. The net loss for 1997 included the net impact, after
related tax benefit, of restructure and other charges of $4.6 million, or $0.83
per diluted share. The loss incurred in 1997 is primarily a result of margin
reductions due to reductions in shared service clients and start up expenses on
dedicated client services, inefficiencies in field labor execution, poor pricing
decisions for some client contracts, higher business unit overhead costs and the
recognition of restructure charges and other non-reoccurring charges.

LIQUIDITY AND CAPITAL RESOURCES

PIA had net losses of $15.1 million for the fiscal year ended 1997, $4.3
million for fiscal year 1998 and $3.3 million for the quarter ended April 2,
1999. PIA expects to have further losses for the second quarter of fiscal 1999.
The merger with SPAR is expected to reduce fixed costs and increase PIA's
profitability and cash flow. Should the Merger not be completed, PIA will be
required to significantly reduce its operating costs to

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minimize the effects of further reductions in revenues and operating losses. PIA
cannot guarantee that it will not sustain further losses.

In December 1998, PIA California and another subsidiary of PIA entered into
a loan and security agreement with Mellon Bank, N.A. The agreement provides for
a revolving line of credit that allows maximum borrowing of $20.0 million and
requires PIA California to borrow and maintain a minimum balance of $2.0
million. The three-year credit facility will be used for working capital
purposes and potential acquisitions. At April 2, 1999, PIA California did not
comply with the net worth covenant and a forbearance was granted by the bank.
PIA California anticipates that it will not be in compliance with future
covenants and that bank forbearances will be requested. PIA California cannot
guarantee that future forbearances will be granted by the bank. In the event
that the bank elects not to grant a forbearance for covenant non-compliance, the
bank has the ability to immediately accelerate the maturity of the credit
facility which acceleration could have a material adverse effect on PIA.

On March 1, 1996, PIA completed an initial public offering of PIA Common
Stock, raising $26.5 million. Prior to this offering, PIA's primary sources of
financing were senior borrowings from a bank under a revolving line of credit
and subordinated borrowings from two stockholders. As of April 2, 1999, PIA used
the proceeds from the offering to repay bank debt of $3.4 million, to repurchase
507,000 shares of PIA Common Stock for approximately $3.0 million and to fund
PIA's operating losses in 1997, 1998, and the quarter ended April 2, 1999.

Cash and cash equivalents totaled $11.1 million at January 1, 1999,
compared with $7.4 million at April 2, 1999. At January 1, 1999 and April 2,
1999 PIA had working capital of $13.8 million and $8.8 million, respectively,
and current ratios of 2.5 and 1.8, respectively.

Net cash used in operating activities for the three months ended April 2,
1999 was $3.6 million, compared with $4.5 million for the comparable period in
1998. This use of cash for operating activities in 1999 resulted primarily from
a decrease in accounts payable and other liabilities, and a net operating loss.
Net cash used in investing activities for the three months ended April 3, 1998
and April 2, 1999 was $0.2 million and $0.1 million, respectively.

The above activity resulted in a net decrease in cash and cash equivalents
of $3.7 million for the three month period ended April 2, 1999 (resulting from
its operating losses and a reduction in accounts payable, that were offset
partially by a reduction in accounts receivable), compared to a net decrease of
$4.7 million for the comparable period in 1998. However, with the addition of
the revolving line of credit (subject to availability), timely collection of
receivables, and PIA's positive working capital position, management believes
the funding of operations over the next twelve months will be sufficient.

Cash and cash equivalents and the timely collection of its receivables
provide PIA's current liquidity. However, the potential uncollectibility of
receivables due from any of PIA's major clients, or a significant reduction in
business from such clients, or the inability to acquire new clients would have a
material adverse effect on PIA's cash resources and its ongoing ability to fund
operations.

PIA may incur additional indebtedness in 1999 in connection with the
merger. SPAR acquired the assets of MCI in January 1999. A portion of the
purchase price was paid through the issuance of a promissory note in the
aggregate original principal amount of $12,422,189 (plus an earnout, if any)
which matures on September 15, 1999. As of March 31, 1999, the amount owed under
the note is estimated to be $10.8 million inclusive of an approximate $2 million
net worth adjustment in SMCI's favor as estimated by SMCI and excluding the
earnout payment, if any. In addition, the SAI Principals loaned SPAR $2,958,000
to facilitate the MCI Acquisition. If this indebtedness is not repaid before the
Merger is consummated, the Combined Company will assume these obligations along
with other liabilities of the SPAR Companies. See "Risk Factors -- The Combined
Company May Be Unable to Meet Its Capital Needs or Obtain Additional Financing."
Further, PIA will incur substantial costs in connection with the transaction,
including legal, accounting and investment banking fees and severance payments
of an aggregate of approximately $5.4 million. PIA is currently negotiating with
major banks for a $50 million revolving line of credit to meet cash needs in
connection with the merger and future potential acquisitions in 1999. PIA cannot
provide any assurance that it will be able to secure a $50 million revolving
line of credit. Failure to obtain such credit facility could have a material
adverse effect on PIA.

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YEAR 2000 SOFTWARE COSTS

Many currently installed computer systems and software products are coded
to accept only two digit entries in the data code field. As a result, many
date-sensitive computer applications will fail beginning January 1, 2000 because
they are unable to process dates properly beyond December 31, 1999. PIA has
reviewed its computer systems to identify areas that could be affected by Year
2000 issues and has implemented a plan to resolve these issues.

PIA has substantially completed the evaluation of its information
technology infrastructure, software, hardware and communications systems. PIA
believes that its critical hardware and software applications are currently Year
2000 compliant. Completion of PIA's plan to upgrade all hardware and software
applications to be Year 2000 compliant is expected by the third quarter of 1999.
Third party vendors are also being reviewed for Year 2000 compliance and PIA
expects this risk assessment to be complete by the end of second quarter of
1999. PIA's assessment and evaluation efforts include testing systems, inquiries
of third parties and other research. By implementing significant systems
upgrades, PIA believes that it has substantially reduced its potential internal
exposure to Year 2000 problems.

The most reasonably likely worst case scenario with respect to Year 2000
issues involves Year 2000 problems experienced by PIA's staffing suppliers. In
such a scenario PIA's ability to efficiently deploy the necessary staff to
service its clients' needs could be negatively affected. PIA does not anticipate
that any such effects would be of a long term nature as it has alternative
methods of deploying staff that do not involve the use of such suppliers. In the
event that certain systems fail to function properly, manual processes will be
implemented.

PIA will utilize internal resources to reprogram, or replace and test the
software for Year 2000 modifications. The total cost of the Year 2000 project is
estimated at $67,000 and is being funded through operating cash flows. Of the
total project cost, approximately $6,000 was expensed in fiscal year 1998,
$20,000 was expensed in the first quarter of 1999, and the remaining $41,000
will be expensed in the last nine months of 1999. It is not expected that these
costs will have a material effect on the results of operations.

The extent and magnitude of the Year 2000 problem as it will affect PIA
externally, both before and after January 1, 2000, is difficult to predict or
quantify for a number of reasons. These include the lack of control over systems
that are used by third parties that are critical to PIA's operation, the
complexity of testing inter-connected networks and applications that depend on
third party networks. If any of these third parties experience Year 2000
problems, it could have a material adverse effect on PIA. Due to the nature of
its business, however, PIA does not believe that its operations are dependent on
third party systems. Furthermore, PIA believes that manual processes could be
implemented if certain systems failed to function properly. PIA is not currently
aware of any material operational issues associated with preparing its internal
systems for the Year 2000, or the adequacy of critical third party systems. PIA
has not developed a contingency plan in case it does not achieve Year 2000
compliance on or before December 31, 1999. The results of its evaluation and
assessment efforts do not indicate a need for contingency planning. PIA intends
to continue assessing its Year 2000 compliance, implementing compliance plans
and communicating with third parties about their Year 2000 compliance. If PIA's
continued efforts indicate that contingency planning is prudent, PIA will
undertake appropriate planning at that time.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

PIA is exposed to market risk related to the variable interest rate on the
line of credit and the variable yield on it's cash and cash equivalent. PIA's
accounting policies for financial instruments and disclosures relating to
financial instruments require that PIA's consolidated balance sheets include the
following financial instruments: cash and cash equivalents, accounts receivable,
accounts payable and long term debt. PIA considers carrying amounts of current
assets and liabilities in the consolidated financial statements to approximate
the fair value for these financial instruments, because of the relatively short
period of time between origination of the instruments and their expected
realization. The carrying amounts of long-term debt approximate fair value
because the obligation bears interest at a floating rate. PIA monitors the risks
associated with interest rates and financial instrument positions based on
policies set by arrangement card approved by the Board of Directors. PIA's
investment policy objectives require the preservation and safety of

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the principal, sufficient liquidity to meet expected and unexpected cash
requirements, and the maximization of the return on investment based upon the
safety and liquidity objectives.

PIA's revenue derived from international operations is not material and,
therefore, the risk related to foreign currency exchange rates is not material.

INVESTMENT PORTFOLIO

PIA has no derivative financial instruments or derivative commodity
instruments in its cash and cash equivalents and investments. PIA invests its
cash and cash equivalents in investments in high-quality and highly liquid
investments consisting of taxable money market instruments, corporate bonds and
some tax-exempt securities. The average yields on PIA's investments in the first
quarter ended April 2, 1999 were approximately 4.3% based on outstanding
investments which ranged from $6.2 million to $13.1 million. The average yields
on PIA's investments in the first quarter ended April 3, 1998 were approximately
5.0% based on outstanding investments which ranged from $9.6 million to $10.9
million. As of April 2, 1999, PIA's cash and cash equivalents and investments
totaled $7.5 million and consisted primarily of taxable money market
instruments, corporate bonds and tax-exempt securities with maturities of less
than one year with an average yield of approximately 4.0%. As of April 3, 1998,
PIA's cash and cash equivalents and investments totaled $9.6 million and
consisted primarily of taxable money market instruments, corporate bonds and
tax-exempt securities with maturities of less than one year and with an average
yield of approximately 5.0%. If there were a 10% change in the average yield
based upon PIA's outstanding investments of $7.5 million, interest income would
increase or decrease by $30,000 per annum.

DEBT

PIA obtained a line of credit with Mellon Bank N.A. in December 1998 and
immediately drew down the minimum borrowing requirement of $2.0 million, and had
an outstanding balance of $2.0 million at January 1, 1999. The line of credit
requires monthly interest payments based on a variable interest rate applied to
the outstanding loan balance. The weighted average interest rate on borrowings
for the quarter ended April 2, 1999 was 8.0% and if there were a 10% change in
the interest rate based upon PIA's minimum borrowing requirement of $2.0 million
interest expense would increase or decrease by $16,000 per annum.

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MARKET AND DIVIDEND INFORMATION FOR PIA

PRICE RANGE OF COMMON STOCK

The following table sets forth the reported high and low sales prices of
the Common Stock for the quarters indicated as reported on the Nasdaq National
Market. PIA is traded on the Nasdaq National Market under the symbol "PIAM".

1997              1998              1999
----------------   ---------------   ---------------
HIGH      LOW      HIGH     LOW      HIGH     LOW
-------   ------   ------   ------   ------   ------

First Quarter............  $11.000   $5.125   $6.500   $5.000   $5.000   $2.875
Second Quarter...........    7.125    5.375    8.156    3.688
Third Quarter............    8.250    5.125    6.844    4.125
Fourth Quarter...........    9.000    4.875    4.875    2.000

As of June 7, 1999, there were approximately 870 holders of record of PIA's
Common Stock.

PIA has never declared or paid any cash dividends on its capital stock and
does not anticipate paying cash dividends on its Common Stock in the foreseeable
future. PIA currently intends to retain future earnings to finance its
operations and fund the growth of its business. Any payment of future dividends
will be at the discretion of the Board of Directors of PIA and will depend upon,
among other things, PIA's earnings, financial condition, capital requirements,
level of indebtedness, contractual restrictions in respect to the payment of
dividends and other factors that PIA's Board of Directors deems relevant.

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BUSINESS OF SPAR

This section (Business of SPAR) and other parts of this Proxy Statement
contain, in addition to historical information, forward-looking statements that
involve risks and uncertainties. Actual results could differ significantly from
the results discussed in the forward-looking statements. Factors that could
cause or contribute to such differences include, but are not limited to, those
discussed in "Risk Factors." See the glossary at Annex E for a description of
certain terms that are used throughout this Proxy Statement.

SAI was founded on December 31, 1998. Immediately prior to the Effective
Time of the Merger, SAI will acquire, directly or indirectly, all of the stock
of SMI, SMF, SINC, SBRS, SMNEV, SIM, SMCI and STM from the SAI Principals,
pursuant to the Reorganization Agreement. SAI's acquisition of such stock and
the other transactions under the Reorganization Agreement will be referred to as
the SPAR Reorganization Transactions.

SPAR currently provides merchandising and marketing services to leading
entertainment, consumer goods, food products and retail companies through the
Existing SPAR Divisions: (i) merchandising and marketing services through the
SPAR Merchandising Division; and (ii) premium incentives through the SPAR
Incentive Division. Following the Merger, PIA California and its subsidiaries
will form the PIA Division, which will continue to provide merchandising and
marketing services.

PIA and SPAR intend to consolidate the sectors of the marketing services
industry that its Divisions will serve through the acquisition of other
marketing, merchandising and incentive companies. Additionally, PIA and SPAR
intend to pursue acquisitions in other sectors of this industry, such as ad
specialty (using free promotional items to stimulate corporate remembrance),
direct marketing (marketing to or soliciting orders from consumers via mail and
telephone), database marketing (direct marketing using lists developed by
marketers with proprietary data), sales promotions (marketing activities to
encourage purchases in support of or in lieu of advertising),
information/research (collecting and reselling data on consumers and consumer
preferences), sampling (distributing free product to consumers to promote
awareness) and demonstrations (live exhibitions, typically in-store, of how a
product works). As part of its acquisition strategy, SPAR is actively exploring
and considering a number of potential acquisition candidates, however, there can
be no assurance that any of the acquisitions will occur or whether, if
completed, the consolidation of the sectors of the marketing services industry
will be successful. Neither PIA nor SPAR has entered into any definitive and
binding arrangements with respect to any contemplated acquisition.

The Existing SPAR Divisions currently operate in all 50 states and serve a
broad range of the nation's leading companies. The top ten customers of SPAR in
fiscal 1998 (as a percentage of net revenue) were Warner Home Video, General
Motors Corporation, Buena Vista Home Video, Gallant Greetings, Procter & Gamble,
Canon, Bausch & Lomb, 3M, Valley Media, and Conoco. Warner Home Video, General
Motors Corporation, Buena Vista Home Video and Procter & Gamble have accounted
for more than ten percent of SPAR's net revenue during its last three fiscal
years, as follows:

COMPANY NAME                   FISCAL 1998   FISCAL 1997   FISCAL 1996
------------                   -----------   -----------   -----------
% OF NET REVENUES

Warner Home Video.............................     24.6          15.0             --
General Motors Corporation....................     13.7          10.0             --
Buena Vista Home Video........................     13.6          15.3           11.4
Procter & Gamble..............................       --            --           30.2

The loss of any of the customers referred to in the foregoing chart would
have a material adverse effect upon SPAR. The SPAR Merchandising Division and
the SPAR Incentive Division conduct their businesses through approximately 3,300
employees and 2,300 independent contractors, as well as outside service
providers.

THE DIVISIONS OF SPAR

SPAR MERCHANDISING DIVISION

The Original SPAR Group. Since the founding of its predecessor companies in
1967, the SPAR Merchandising Division has become a national marketing services
company that provides retail merchandising

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and other marketing services to home video, consumer goods and food products
companies, including Warner Bros., General Motors Corporation, Gallant Greeting
and The Procter & Gamble Company. The SPAR Merchandising Division's services
include in-store merchandising, test market research, mystery shopping, database
marketing and data collection. The SPAR Merchandising Division also provides
teleservices (using telecommunications and telemarketers for gathering and
soliciting information) within an extensive inbound and outbound call center.
The SPAR Merchandising Division offers these services directly through a network
of in-store merchandising specialists and teleservices and data entry personnel
consisting of approximately 3,000 part-time employees. In addition, the SPAR
Merchandising Division currently contracts with SMS to provide the services of
approximately 2,300 independent contractors and four regional and 33 district
managers who currently oversee and deploy the SMS independent contractors and
the SPAR Merchandising Division's part-time employees. See "-- Certain
Relationships and Related Party Transactions." By using its part-time employees
and contracting with providers of independent contractors, the SPAR
Merchandising Division is able to assign work on an as needed basis, which
enables the SPAR Merchandising Division to be responsive to client needs on
short notice (without incurring fixed costs) and to cover approximately 8,000
stores and 30 chains and make 45,000 client calls per month. Management believes
this structure provides the SPAR Merchandising Division with a significant
advantage relative to retailers or smaller brokers who generally cannot optimize
an employee's time over multiple locations and clients. The SPAR Merchandising
Division maintains five offices in the United States, including its headquarters
in Tarrytown, New York, and its teleservices center in Rochester Hills,
Michigan.

The SPAR Merchandising Division uses in-store merchandising specialists to
provide a variety of retail servicing and merchandising services to clients,
including category resets (reorganizing new or existing products on shelves),
reordering, shelf stocking, placing and maintenance of shelf tags and stocking
video displays plus a full-range of consumer, trade and in-store intelligence
(gathering information on store conditions). Market research performed by the
SPAR Merchandising Division for its clients includes a full range of consumer,
trade and in-store services including test marketing, reporting on in-store
conditions and mystery shopping. This information is of particular value to the
SPAR Merchandising Division's clients because it provides them with the data
necessary to evaluate their advertising and promotional efforts.

The SPAR Merchandising Division emphasizes the use of information
technology, including an interactive voice response system and a teleservices
center, to provide value-added marketing services to its clients. Recently, the
SPAR Merchandising Division introduced a proprietary Internet-based system
called "Business Manager." Through Business Manager, its management can
coordinate and evaluate on a real-time basis the services provided through its
network of merchandising specialists and quantify the impact of the services on
client sales and profit. The SPAR Merchandising Division has tested a field
merchandising solution that combines a wearable personal computer with
hands-free voice recognition software, a heads-up display, bar-code scanner,
digital camera and wireless modem to link to this system. The SPAR Merchandising
Division has tested and is presently using hand-held computers through which it
collects in-store data for certain customers.

PREMIUM INCENTIVE DIVISION

MCI ACQUISITION. On January 15, 1999, SMCI acquired all of the business and
substantially all of the assets of MCI pursuant to the MCI Agreement. The MCI
Acquisition was financed in part through the issuance by SMCI of the MCI Note,
to MCI in an aggregate original principal amount equal to $12,422,189 plus the
amount of the Earn-Out Consideration (as defined in the MCI Agreement). The MCI
Agreement provides that MCI is generally entitled to Earn-Out Consideration
equal to the EBT, of MCI for the period from April 1, 1998, through January 15,
1999, and for SMCI thereafter through March 31, 1999, but MCI is not entitled to
any Earn-Out Consideration if the EBT for such combined periods does not exceed
$3,500,000.

The MCI Note is payable in monthly installments of $400,000, subject to
possible reductions, and is due in full on September 15, 1999. The payment of
$250,000 of each monthly installment is limited to Available Cash and such
installments automatically reduced (with the reductions deferred to maturity) if
there is insufficient Available Cash. MCI may elect to receive up to $3,000,000
of the final installment payment in unregistered shares of common stock of any
publicly traded company holding, directly or indirectly, all of the issued and
outstanding stock of SMCI (i.e., in shares of PIA Common Stock), valued at the
average public trading price for the 30 day period preceding the maturity date.
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Based upon the unaudited balance sheet of MCI as of January 15, 1999, SMCI
estimates that a net worth adjustment in the amount of approximately $2 million
is due to SMCI from MCI. Neither the net worth adjustment nor the Earn Out
Consideration calculation has been agreed to by MCI, and MCI is believed to be
reviewing whether SMCI's net worth calculation is accurate and any Earn Out
Consideration is due. If the parties cannot agree upon such amounts, legal
proceedings may ensue with respect to this matter.

SPAR MCI. SMCI specializes in designing and implementing premium incentives
and managing group travel and meetings for clients throughout the United States,
which business MCI began in 1987. The top ten customers of MCI in fiscal 1998
(as a percentage of net revenue) were MCI Worldcom, Taco Bell, Sterling Inc.,
Triangle Pacific, Source Services/Romac, Sally Beauty, Medeva, Merisel,
Viewsonic and CVS/Revco. Both MCI Worldcom (including its divisions) and Taco
Bell have accounted for more than ten percent of MCI's net revenue during its
last three fiscal years, as indicated in the chart set forth below. The loss of
either of those customers would have a material adverse effect upon SMCI.

FISCAL    FISCAL    FISCAL
COMPANY NAME                        1998      1997      1996
------------                       ------    ------    ------
% OF NET REVENUES

MCI Worldcom..........................................    30        --        --
MCI Business Sales & Service*.........................    --        21        15
MCI Mass Markets*.....................................    --         8        12
Taco Bell.............................................    16        12        --

---------------
* Divisions of MCI WorldCom

SMCI provides a wide variety of consulting, creative, program
administration and travel and merchandise fulfillment services to companies
seeking to motivate employees, salespeople, dealers, distributors, retailers and
consumers toward certain action or objectives. SMCI's strategy is to allow
companies to outsource the entire design, implementation and fulfillment of
incentive programs in a one-stop, "umbrella" shopping approach. SMCI consults
with a client to design the most effective plan to achieve the client's goals.
SMCI then provides services necessary to implement the program, generates
detailed efficiency progress reports and reports on the return on investment
upon completion of the program. SMCI also provides meeting and convention
management travel services to clients. SMCI employs approximately 100 people in
its Carrollton, Texas headquarters and maintains additional sales offices in
Nashville, Tennessee, and Newport Beach, California.

SMCI's process typically begins when a client requires assistance in
developing a performance improvement program. SMCI's senior consultants work
with clients to develop programs to improve productivity by delivering positive
reinforcement in ways that are meaningful to employees and supportive of
business strategy. A wide range of reward options is available, including cash,
travel and merchandise. Most formal compensation programs deliver cash to plan
participants, while premium incentives tend to make greater use of non-financial
rewards. SMCI has experience in all forms of incentives and therefore can
provide its clients with the most appropriate program design. SMCI has a full
service agency capability to assist its clients in the writing, designing and
printing of the program elements. Teams of creative directors, copywriters,
graphic designers and print specialists develop campaigns for incentive programs
meetings, trade shows and consumer promotions.

In addition, SMCI provides its clients with travel or merchandise
fulfillment alternatives as well as a series of innovative product specific
alternatives. While the majority of SMCI's fulfillment is in the travel area,
SMCI provides a wide variety of catalog merchandise awards. Through an informal
arrangement with some of the country's largest mass merchandise retailers, SMCI
can provide its clients with programs that offer the flexibility of in-home
ordering. SMCI also provides to its clients custom merchandise, special
catalogs, retail certificates and a Local Purchase Option ("LPO"). The LPO
allows winning participants to select and redeem merchandise from a series of
participating merchants.

SMCI has award delivery programs (developed by MCI) in its Ultima Visa
Award Card program and Phonovation, a system which utilizes state-of-the-art
techniques in interactive voice response. Clients who utilize the card program
have participant awards posted to their Visa statement. Like an airline frequent
flyer program or a credit card frequency program, participants can redeem awards
from any of over 12 million Visa

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locations worldwide. Using toll free telephone numbers, program participants
interact with a computer to reinforce performance, check results or conduct
customer or product satisfaction surveys.

SMCI also provides turnkey program administration for its clients,
utilizing technology to administer large, complex programs for its clients. SMCI
operates a local area network that enables support staff and program
administrators to communicate effectively throughout the United States in
support of a client program. SMCI utilizes Oracle databases to custom design and
build information tracking systems for its clients including input forms and
reports. SMCI uses American Airlines' SABRE system, Sabrevision and Worldview to
provide its clients with a wide range of information and reservation
alternatives. SMCI believes that its technological resources serve as a
competitive advantage.

FACILITIES

SPAR's corporate offices are located in leased space at 303 South Broadway,
Suite 140, Tarrytown, New York 10591. The telephone number of its principal
executive offices is (914) 332-4100. In addition to its corporate offices, the
SPAR Merchandising Division and SMCI maintain the following facilities:

COMPANY                LOCATION                        PRINCIPAL USE
-------          --------------------  ----------------------------------------------

SPAR Merchandising
Division.............  Tarrytown, NY         Headquarters and Sales Office
Mahwah, NJ            SBRS Office
Cincinnati, OH        SBRS Office
Rochester Hills, MI   Regional Office and Teleservices Center
Regional Office and Information Technology
Eden Prairie, MN      Office
SMCI...................  Carrollton, TX        Headquarters
Newport Beach, CA     Sales Office
Nashville, TN         Sales Office

SPAR believes that all of the above facilities are adequate for the
Existing SPAR Divisions' current and anticipated operations.

SPAR is entering into a new lease for its executive offices in Tarrytown,
New York. In order to provide additional space for their current needs and
future expansion, a portion of that space will be sublet by SPAR to its
affiliate, SIT, on a month-to-month basis at cost until such time (if ever) as
SPAR needs that space.

COMPETITION

The marketing services industry is highly competitive. Competition in each
of the Existing SPAR Divisions arises from a number of enterprises which are
national in scope. SPAR also competes in each of the Existing SPAR Divisions
with a large number of relatively small enterprises with specific client,
channel or geographic coverage, as well as the internal marketing and
merchandising operations of its clients and prospective clients. The SPAR
Merchandising Division and PIA each competes with independent brokers and
smaller, regional providers. In the premium incentive sector, SMCI competes with
Carlson Marketing Group, Inc., Maritz Inc. and BI Services, each of which has
significantly greater financial and marketing resources than SMCI, as well as
Exceed Motivation, Incentive Associates and regional and local suppliers. SPAR
believes that it is able to compete effectively in the SPAR Merchandising
Division through a national network of employees and other merchandisers, broad
service offerings and information technology capabilities, which will augment
the strengths of the PIA Division, and in the SPAR Incentive Division through
its broad range of products and value-added services and competitive pricing.
See "Risk Factors -- The Marketing Services Industry Is Highly Competitive and
the Combined Company May Be Unable to Compete Against Larger Companies with
Greater Resources."

EMPLOYEES

As of May 1, 1999, the SPAR Merchandising Division employed approximately
3,231 people, of whom approximately 169 were full-time employees and
approximately 3,062 were part-time employees, of which approximately 148
full-time employees were engaged in operations and 14 were engaged in sales. As
of May 1, 1999, the SPAR Incentive Division (i.e., SMCI) employed approximately
100 people of whom approximately

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98 were full-time employees and approximately 2 were part time employees, of
which approximately 93 full-time employees were engaged in operations and 7 were
engaged in sales. As of May 1, 1999, PIA employed approximately 2,147 people, of
whom approximately 1,105 were full-time employees and approximately 1,042 were
part-time employees, of which approximately 999 full-time employees were engaged
in operations and 38 were engaged in sales.

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Mr. Robert G. Brown, a director and the Chairman and Chief Executive
Officer of each of the SPAR Companies (and of the Combined Company), and Mr.
William H. Bartels, a director and the Vice Chairman, Secretary and Treasurer of
each of the SPAR Companies (and a director and the Vice Chairman of the Combined
Company), are the sole stockholders and executive officers and directors of SMS,
SIT, and certain other companies that are not parties to the Merger Agreement
and will not be included in the Combined Company.

SMS provided field representative (through its independent contractors) and
field management services to the SPAR Marketing Companies at a total cost of
$6.4 million to the SPAR Marketing Companies in the fiscal year ended March 31,
1998, and at a total cost of $5.1 million to the SPAR Marketing Companies for
the nine months ended December 31, 1998. Under the terms of the Field Service
Agreement, SMS will continue to provide the services of approximately 2,300
field representatives and 37 regional and district managers to the SPAR
Marketing Companies as they may request from time to time, for which the SPAR
Companies have agreed to pay SMS for all of its costs of providing those
services plus 4%. However, SMS may not charge any SPAR Company for any past
taxes or associated costs for which the SAI Principals have agreed to indemnify
the SPAR Companies. See "Business of SPAR -- Related Party Contingent Tax
Liability," below.

SIT provided computer programming services to SMF at a total cost of
$213,000 to SMF in the fiscal year ended March 31, 1998, and at a total cost of
$248,000 to SMF for the nine months ended December 31, 1998. Under the terms of
the programming agreement between SMF and SIT effective as of October 1, 1998
(the "Programming Agreement"), SIT continues to provide programming services to
SMF as SMF may request from time to time, for which SMF has agreed to pay SIT
competitive hourly wage rates and to reimburse SIT's out-of-pocket expenses.

As a condition to the Merger Agreement, SMF, SMS and SIT will enter into a
Software Ownership Agreement with respect to Internet job scheduling software
jointly developed by such parties. In addition, STM, SMS and SIT will enter into
trademark licensing agreements whereby STM will grant non-exclusive royalty-free
licenses to SIT and SMS for the use of the name "SPAR" and certain other
trademarks and related rights owned by STM.

In the event of any material dispute in the business relationships between
the Combined Company and SMS or SIT, or in the course of pursuing SMS's
independent contractor/employee dispute with the IRS, it is possible that
Messrs. Brown and Bartels may have one or more conflicts of interest with
respect to these relationships and dispute that could have a material adverse
effect on the Combined Company. See "Business of SPAR -- Related Party
Contingent Tax Liability" and "Notes to the Combined Financial Statements of
SPAR."

LEGAL PROCEEDINGS

SPAR is, from time to time, a party to litigation or administrative
proceedings that arise in the normal course of its business. SPAR does not have
pending any litigation that, separately or in the aggregate, if adversely
determined, would have a material adverse effect on the business, financial
condition or results of operations of SPAR. (See the next paragraphs with
respect to certain SPAR affiliate litigation.)

RELATED PARTY CONTINGENT TAX LIABILITY

The SPAR Marketing Companies contract with SMS, to receive the services of
SMS's field representative and field managers pursuant to the Field Service
Agreement, and have received such services under similar arrangements in the
past. Robert G. Brown and William H. Bartels (the SAI Principals) own all of the

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stock of SMS, and prior to the acquisition of the SPAR Companies by SAI in the
SPAR Reorganization Transactions, have owned all the stock of the SPAR
Companies. SMS is a separate corporation and is not being acquired by any of the
SPAR Companies or PIA Companies. See "Risk Factors -- Potential Conflicts of
Interest Regarding Services Provided by SMS and SIT." Approximately 75% of the
in-store merchandising specialists who perform work for the SPAR Marketing
Companies are SMS field representatives, while the other 25% are employees of
SMF. The information in the following three paragraphs has been provided to the
SPAR Marketing Companies by SMS.

SMS has always treated its field representatives as independent
contractors, and in 1986 SMS received a favorable determination letter from the
IRS that SMS's field representatives were properly classified as "independent
contractors" for Federal employment tax purposes. In connection with the audit
of SMS's tax returns for 1991 and 1992, the IRS reversed its earlier position
and determined that SMS's field representatives should have been treated as
employees, claiming that SMS owed approximately $2,000,000 in federal employment
related taxes and interest. This claimed deficiency assumes that the field
representatives failed to pay any taxes themselves (even though SMS filed the
requisite Form 1099s), as all of the tax payments made by the field
representatives respecting their payments from SMS during such years would be
credited against any such amount that SMS might owe (and such payments are
generally discoverable). If this IRS reversal were to be upheld and be applied
to the years 1993 through 1998, SMS could owe up to approximately $6.6 million
in additional employment taxes (including withholding for income taxes),
penalties and interest (again assuming that the field representatives failed to
pay any self-employment taxes themselves). However, SMS is vigorously contesting
this determination and contemplates filing suit in Tax Court to challenge it,
assuming it is unable to settle the case which is currently under administrative
appeal internally at the IRS. Furthermore, SMS believes (based on settlement
offers and discussions) that it could settle this matter with little or no
payment in employment taxes, penalties and interest if SMS would agree on a
prospective basis to classify its field representatives as employees. SMS has
refused to settle because it believes that its field representatives satisfy the
applicable tax criteria for treatment as independent contractors for federal
employment tax purposes and SMS believes that it will ultimately prevail on this
issue.

Similar claims have been filed against SMS by certain states. However, SMS
is confident in defending its position against the IRS and these state claims
because of prior success in several states, and SMS will continue to vigorously
defend its position against any future state claims that may arise. For example,
SMS prevailed on a similar claim by the State of California, which had
instituted administrative proceedings against SMS. The administrative law judge
agreed with SMS's classification of field representatives as independent
contractors. The State of California has declined to file a further appeal and
has refunded payments made by SMS under protest during the appeal process.

Although SMS is not a party to the Merger Agreement or SPAR Reorganization
Agreement and SPAR has not entered into any tax sharing or tax indemnification
arrangement with SMS, there can be no assurance that the IRS will not attempt to
collect employment taxes from the SPAR Marketing Companies. Accordingly, if SMS
is unable to pay such taxes or otherwise prevail in or settle its dispute with
the IRS, the IRS might seek to collect all or a portion of such tax liability
from the SPAR Marketing Companies as a result of their common control and
business relationship with SMS during the period such liabilities were incurred.
In connection with the closing of the Merger, the SAI Principals have agreed to
indemnify the SPAR Companies and PIA Companies against such potential tax
liability and to place an aggregate of 10% of the shares of PIA Common Stock
issued to them and their family members in the Merger (estimated at
approximately 1.2 million shares) in escrow as security for such indemnification
obligations (and the indemnification obligations of the SAI Principals with
respect to the ADVO Note). In the event, however, SMS is unsuccessful in its
challenge against the IRS's adverse independent contractor determination, and
the IRS were to assert successfully that one or more of the SPAR Marketing
Companies are responsible for all or a portion of such liability, there can be
no assurance the Combined Company will be able to recover from the SAI
Principals any amounts the Combined Company might be required to pay to the IRS.

As part of its overall business plan, and regardless of the outcome of the
SMS tax litigation described above, the Combined Company intends to aggressively
seek out alternative sources to provide in-store merchandising specialists at
the lowest possible cost. The SPAR Marketing Companies currently perform
approximately 75% of their field work through SMF's own employees. There is no
assurance, however, that the Combined Company will be able to procure elsewhere
(through the employees of SMF, the PIA
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Companies or otherwise) replacements for the field representatives currently
provided by SMS. To assure that such representatives will be available from SMS,
SMF has entered into a Field Service Agreement with SMS pursuant to which SMS
field work will be available to SMF on a non-exclusive cost-plus basis. See
'-- Certain Relationships and Related Transactions." If SMS were to settle its
independent contractor dispute with the IRS by treating its field
representatives as employees in the future, such a settlement could increase the
cost to the Combined Company of the SMS field representatives because SMS could
pass-through to the Combined Company any additional operating cost associated
with having field representatives classified as "employees" rather than
"independent contractors." If the SMS in-store merchandising specialists
utilized by the Company had to be treated as employees rather than independent
contractors, if SMS passed any associated additional costs to the Combined
Company, and if the Combined Company was unable to procure the services rendered
by these field representatives elsewhere, it is estimated that the Combined
Company's aggregate operating costs would increase by approximately 1 1/2 to 2%
from 1998.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF
OPERATIONS OF SPAR

The following discussion and analysis of financial condition and results of
operations contains statements that constitute forward-looking statements. Such
forward-looking statements relate to future events or the future financial
performance of SPAR and involve known and unknown risks, uncertainties and other
factors that may cause the actual results, performance or achievements of SPAR
to be materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Such factors include,
among other things, the following: general economic and business conditions;
SPAR's dependence on the trend toward outsourcing; relationship with SMS and
potential employment tax liability; uncertainty regarding and changes in
customer preferences; competition; changes in political, social and economic
conditions; and various other factors beyond SPAR's control. Each holder of PIA
Common Stock should specifically consider the various factors identified in this
Proxy Statement including the matters set forth under "Risk Factors," which
could cause actual results to differ materially from those indicated by such
forward-looking statements. SPAR undertakes no obligation to publicly update or
revise any forward-looking statements, whether as a result of new information,
future events or otherwise. In light of these risks and uncertainties, there can
be no assurance that the forward-looking information contained in this Proxy
Statement will in fact transpire. The following discussion should be read in
conjunction with SPAR's Combined Financial Statements and the related Notes
thereto, included elsewhere in this Proxy Statement.

The SPAR Companies have historically reported financial results on a March
31 fiscal year end. Effective April 1, 1998, the SPAR Companies have elected to
report financial results on a calendar year end. MCI and PIA have historically
reported financial results on a calendar year end. Because the Combined Company
will report financial results on a calendar year end, historical information
appearing in this Proxy Statement relating to the SPAR Companies may not be
comparable to future results of the Combined Company. The SPAR Companies have
elected, by the consent of its stockholders, to be taxed under provisions of
subchapter S of the Internal Revenue Code, with the exception of SBRS which is
taxed as a C corporation.

The following discussion of the financial condition and results of
operations should be read in conjunction with the SPAR Companies' and MCI's
financial statements and the notes thereto appearing elsewhere herein.

THE SPAR COMPANIES

Since the founding of its predecessor companies in 1967, the SPAR Companies
have become a national marketing services company that provides retail
merchandising and other marketing services to home video, consumer goods and
food products companies. The SPAR Companies' services include in-store
merchandising, test market research, mystery shopping, database management and
data collection and teleservices. In March 1996, SMF acquired substantially all
of the assets of Marketing Force, Inc., a provider of merchandising services
primarily to retailers and home video production companies. SMF also performs
teleservicing and database services, primarily for divisions of General Motors
Corporation. In January, 1999, SMCI acquired substantially all of the assets of
MCI, which specializes in designing and implementing premium incentives and
managing group travel and meetings for clients throughout the United States.

RESULTS OF OPERATIONS -- SPAR COMPANIES

The following table sets forth selected financial data and data as a
percentage of net revenues for the periods indicated.

YEARS ENDED MARCH 31,                   NINE MONTHS ENDED DECEMBER 31,
---------------------------------------------------   ---------------------------------
1996              1997              1998              1997              1998
---------------   ---------------   ---------------   ---------------   ---------------
(IN THOUSANDS, EXCEPT PERCENTAGES)

Net revenues...................  $14,425   100.0%  $35,574   100.0%  $36,804   100.0%  $27,202   100.0%  $32,600   100.0%
-------   -----   -------   -----   -------   -----   -------   -----   -------   -----
Gross profit...................    6,746    46.8    13,820    38.8    17,387    47.2    12,623    46.4    16,384    50.3
Selling, general and
administrative expenses......    7,030    48.8    13,477    37.8    12,248    33.2     9,310    34.2    10,120    31.0
-------   -----   -------   -----   -------   -----   -------   -----   -------   -----
Operating income (loss)........     (284)   (2.0)      343     1.0     5,139    14.0     3,313    12.2     6,264    19.2
Other income (expense).........      (99)   (0.7)     (766)   (2.2)     (390)   (1.1)     (295)   (1.1)     (155)    (.4)
-------   -----   -------   -----   -------   -----   -------   -----   -------   -----
Net income (loss)..............  $  (383)   (2.7)% $  (423)   (1.2)  $ 4,749    12.9%  $ 3,018    11.1%  $ 6,109    18.8%
=======   =====   =======   =====   =======   =====   =======   =====   =======   =====

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THREE MONTHS ENDED MARCH 31,
-----------------------------------
1998                1999
---------------    ----------------
(IN THOUSANDS, EXCEPT PERCENTAGES)

Net revenues............................................  $9,602    100.0%   $21,637    100.0%
------    -----    -------    -----
Gross profit............................................   4,764     49.6      7,264     33.6
Selling, general and administrative expenses............   2,938     30.6      4,951     22.9
------    -----    -------    -----
Operating income (loss).................................   1,826     19.0      2,313     10.7
Other income (expense)..................................     (95)   (1.0)       (371)   (1.7)
------    -----    -------    -----
Net income (loss).......................................  $1,731     18.0%   $ 1,942      9.0%
======    =====    =======    =====

THREE MONTHS ENDED MARCH 31, 1999 COMPARED TO THREE MONTHS ENDED MARCH 31,
1998 -- SPAR COMPANIES

NET REVENUES. Net revenue increased to $21.6 million in the three months
ended March 31, 1999 from $9.6 million in the three months ended March 31, 1998,
an increase of $12.0 million or 125%. Net revenues increased $11.4 million, as a
result of the additional MCI business acquired by SMCI on January 15, 1998 and
$0.6 million or 0.6% in the SPAR Companies.

GROSS PROFIT

Cost of revenues in the SPAR Companies consist of in-store labor (including
travel expenses) and field management. Cost of revenues in the company's premium
incentive and managed group travel and meetings business consists of direct
labor, independent contractor, food beverage, entertainment and travel costs.
The SPAR Companies' gross profit increased to $7.3 million in the three months
ended March 31, 1999 from $4.8 million in the three months ended March 31, 1998,
an increase of $2.5 million or 52.5%. $2.4 million of the increased gross profit
is attributable to the addition during the period of the SMCI business and $0.1
million of the increase is attributable to the SPAR Companies. The gross profit
of the SPAR Companies decreased slightly, as a percent of revenue to 47.6% in
the three months ended March 31, 1999 from 49.6% in the three months ended March
31, 1998.

SELLING, GENERAL AND ADMINISTRATIVE

Selling, general and administrative expenses include corporate overhead,
project management information systems, executive compensation, human resources
expenses, and accounting expenses. Selling, General and Administrative expenses
amounted to $4.9 million in the three months ended March 31, 1999 compared to
$2.9 million in the three months ended March 31, 1998, an increase of $2.0
million or 68.5%. Of the increase, $1.4 million is attributed to the addition
during the period of the MCI business acquired by SMCI and the balance $0.6
million attributed to an increase in the SPAR Companies. Approximately half the
$0.6 million increase results from the increase in the Company's business and
the balance to higher year end accruals this year compared to the three months
ended March 31, 1998.

OPERATING INCOME

As a result of the factors discussed above, operating income increased to
$2.3 million in the three months ended March 31, 1999 from $1.8 million earned
in the three months ended March 31, 1998, an increase of $.5 million or 26.7%.
The $.5 million increase in operating income results from the addition of $1.0
million operating profit attributable to the addition during the period of the
MCI business acquired by SMCI January 15, 1999 and a $.5 million decrease in
operating profit for the three months ended March 31, 1999 in the SPAR Companies
resulting from the higher selling, general and administrative expenses discussed
above.

OTHER INCOME (EXPENSE). Other expense increased to $(.4) million in the
three months ended March 31, 1999 from $(.1) million in the three months ended
March 31, 1998, an increase in expense of $(.3) million or 300%. The increase is
attributable to the addition of $(.3) million of net interest expense in the
three months ended March 31, 1999 from the operations during the period of the
MCI business acquired by SMCI January 15, 1999.

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NET INCOME. As a result of the factors discussed above -- net income
increased to $1.9 million in the three months ended March 31, 1999 compared to
$1.7 million in the three months ended March 31, 1998, an increase of $.2
million or 12.2%. As a percent of revenues, net income in the three months ended
March 31, 1999 decreased to 9.2% from the 18% experienced in the three months
ended March 31, 1998.

NINE MONTHS ENDED DECEMBER 31, 1998 COMPARED TO NINE MONTHS ENDED DECEMBER 31,
1997 -- SPAR COMPANIES

NET REVENUES. Net revenues increased to $32.6 million in the nine months
ended December 31, 1998 from $27.2 million in the nine months ended December 31,
1997, an increase of $5.4 million, or 19.8%. Net revenues increased due to
increased sales of in-store merchandising, predominately in the home video
sector.

GROSS PROFIT. Cost of revenues consists of in-store labor (including travel
expenses) and field management. SPAR's gross profit increased to $16.4 million
in the nine months ended December 31, 1998 from $12.6 million in the nine months
ended December 31, 1997, an increase of $3.8 million, or 30.0%. Gross margin
increased slightly to 50.3% in the nine months ended December 31, 1998 from
46.4% in the nine months ended December 31, 1997.

SELLING, GENERAL AND ADMINISTRATIVE. Selling, general and administrative
expenses include corporate overhead, project management, management information
systems, executive compensation, human resources expenses and accounting
expenses. Selling, general and administrative expenses increased to $10.1
million in the nine months ended December 31, 1998 from $9.3 million in the nine
months ended December 31, 1997, a increase of $0.8 million, or 8.7%. As a
percentage of net revenues, selling, general and administrative expenses
decreased to 31.0% of net revenue in the nine months ended December 31, 1998
from 34.2% in the nine months ended December 31, 1997. This decrease is
primarily the result of higher net revenues and continued cost controls and a
resultant decrease in selling, general and administrative expenses for the nine
months ended December 31, 1998.

OPERATING INCOME (LOSS). As a result of the factors discussed above,
operating income increased to $6.3 million in the nine months ended December 31,
1998 from $3.3 million in the nine months ended December 31, 1997, an increase
of $3.0 million, or 90.9%. As a percentage of net revenues, operating income
increased to 19.2% of net revenue in the nine months ended December 31, 1998
from 12.2% in the nine months ended December 31, 1997.

OTHER INCOME (EXPENSE). Other expense decreased to $(0.2) million in the
nine months ended December 31, 1998 from $(0.3) million in the nine months ended
December 31, 1997. As a percentage of net revenues, other expense decreased to
(0.4)% in the nine months ended December 31, 1998 from (1.1)% in the nine months
ended December 31, 1997.

NET INCOME. As a result of the factors discussed above, net income
increased to $6.1 million in the nine months ended December 31, 1998 from $3.0
million in the nine months ended December 31, 1997, an increase of $3.1 million,
or 96.8%. As a percentage of net revenues, net income increased to 18.7% in the
nine months ended December 31, 1998 from 11.1% in the nine months ended December
31, 1997.

YEAR ENDED MARCH 31, 1998 COMPARED TO YEAR ENDED MARCH 31, 1997 -- SPAR
COMPANIES

NET REVENUES. Net revenues increased to $36.8 million in the year ended
March 31, 1998 from $35.6 million in the year ended March 31, 1997, an increase
of $1.2 million, or 3.5%. Net revenues increased slightly as a result of new
merchandising services customers in the home video sector, offset in large part
by the SPAR Companies' exit from certain less profitable business lines, such as
in-store demonstrations, acquired by SMF in its 1996 acquisition of Marketing
Force, Inc.

GROSS PROFIT. The SPAR Companies' gross profit increased to $17.4 million
in the year ended March 31, 1998 from $13.8 million in the year ended March 31,
1997, an increase of $3.6 million, or 25.8%. Gross margin increased to 47.2% of
net revenue in the year ended March 31, 1998 from 38.8% in the year ended March
31, 1997. The increase in gross margin is primarily the result of management's
focus on achieving the cost savings envisioned in the combination of the SPAR
Companies and SMF and the exit from the less profitable business lines described
above.

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SELLING, GENERAL AND ADMINISTRATIVE. Selling, general and administrative
expenses decreased to $12.2 million in the year ended March 31, 1998 from $13.5
million in the year ended March 31, 1997, a decrease of $1.2 million, or 9.1%.
As a percentage of net revenues, selling, general and administrative expenses
decreased to 33.2% in the year ended March 31, 1998 from 37.8% in the year ended
March 31, 1997. Selling, general and administrative expenses decreased as a
percentage of net revenues due to management's efforts to reduce costs and
improve efficiency through the reduction of certain facilities, including the
consolidation of SMF's warehousing and teleservices facilities, and the
reduction of personnel.

OPERATING INCOME (LOSS). As a result of the factors discussed above,
operating income increased to $5.1 million in the year ended March 31, 1998 from
$0.3 million in the year ended March 31, 1997, an increase of $4.8 million, or
1,398.3%. As a percentage of net revenues, operating income increased to 14.0%
in the year ended March 31, 1998 from 1.0% in the year ended March 31, 1997.

OTHER INCOME (EXPENSE). Other expense decreased to $(0.4) million in the
year ended March 31, 1998 from $(0.8) in the year ended March 31, 1997, a
decrease of $0.4 million, or 49.1%. As a percentage of net revenues, other
expense decreased to (1.1)% in the year ended March 31, 1998 from (2.2)% in the
year ended March 31, 1997. This decrease in other expense is primarily
attributable to nonrecurring charges in 1997 relating to the abandonment of
certain assets.

NET INCOME (LOSS). As a result of the factors discussed above, net income
increased to $4.7 million in the year ended March 31, 1998 from a loss of $(0.4)
million in the year ended March 31, 1997, an increase of $5.2 million. As a
percentage of net revenues, net income increased to 12.9% in the year ended
March 31, 1998 from a net loss of (1.2)% in the year ended March 31, 1997.

YEAR ENDED MARCH 31, 1997 COMPARED TO YEAR ENDED MARCH 31, 1996 -- SPAR
COMPANIES

NET REVENUES. Net revenues increased to $35.6 million in the year ended
March 31, 1997 from $14.4 million in the year ended March 31, 1996, an increase
of $21.1 million, or 146.6%. This increase was primarily driven by the
acquisition of substantially all of the assets of Marketing Force, Inc. by SMF,
which accounted for $21.0 million of net revenues in the year ended March 31,
1997, an increase of $18.0 million from the year ended March 31, 1996. The
increase was also driven by additional business from other merchandising and
marketing services clients of the SPAR Companies which accounted for $14.6
million of net revenues in the year ended March 31, 1997, an increase of $3.2
million from the year ended March 31, 1996.

GROSS PROFIT. Gross profit increased to $13.8 million in the year ended
March 31, 1997 from $6.7 million in the year ended March 31, 1996, an increase
of $7.1 million, or 104.9%, primarily as a result of increased revenues. Gross
margin decreased as a percentage of net revenue to 38.8% in the year ended March
31, 1997 from 46.8% in the year ended March 31, 1996. The decrease in gross
margin as a percentage of net revenue is primarily a result of the acquisition
of Marketing Force, Inc. by SMF, which resulted in the temporary duplication of
certain costs such as field management and project management.

SELLING, GENERAL AND ADMINISTRATIVE. Selling, general and administrative
expenses increased to $13.5 million in the year ended March 31, 1997 from $7.0
million in the year ended March 31, 1996, an increase of $6.4 million, or 91.7%
primarily a result of the acquisition of Marketing Force, Inc. by SMF and
increased personnel costs to support the increase in net revenues. As a
percentage of net revenues, selling, general and administrative expenses
decreased to 37.8% in the year ended March 31, 1997 from 48.8% in the year ended
March 31, 1996 primarily as a result of the elimination of administrative
personnel and closure of certain warehousing facilities and regional offices
after the acquisition of Marketing Force, Inc. by SMF .

OPERATING INCOME. As a result of the factors discussed above, operating
income (loss) increased to $0.3 million profit in the year ended March 31, 1997
from $(0.3) million profit in the year ended March 31, 1996, an increase of $0.6
million, or 220.8%. As a percentage of net revenues, operating income increased
to 1.0% in the year ended March 31, 1997 from (2.0)% in the year ended March 31,
1996.

OTHER INCOME (EXPENSE). Other expense increased to $(0.8) in the year ended
March 31, 1997 from $(0.1) million in the year ended March 31, 1996, an increase
of $0.7 million. As a percentage of net revenues, other expense increased to
(2.2)% in the year ended March 31, 1997 from (0.7)% in the year ended

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March 31, 1996. Other expense increased as a result of higher interest expense
associated with increased borrowings and a loss related to the abandonment of
certain assets.

NET INCOME (LOSS). As a result of the factors discussed above, net loss
remained constant at $(0.4) million in the year ended March 31, 1997 and in the
year ended March 31, 1996. As a percentage of net revenues, net loss decreased
to (1.2)% in the year ended March 31, 1997 from (2.7)% in the year ended March
31, 1996.

MCI

In January 1999, SMCI acquired substantially all of the assets of MCI, a
Texas corporation, the predecessor of which was founded in 1987. MCI specialized
in designing and implementing premium incentives and managing group travel and
meetings for clients throughout the United States. MCI employed approximately
100 people and maintained its headquarters in Carrollton, Texas, as well as
sales offices in Nashville, Tennessee and Newport Beach, California.

MCI's revenues consisted primarily of fees charged for the design and
implementation of its programs. Program revenues and related external costs were
recognized when a project was completed; a project typically spanned a period of
six to twelve months. Because an individual project may have comprised a
significant portion of MCI's revenues in any particular quarter, MCI experienced
significant variability in its quarterly revenues. Direct costs primarily
included labor incurred for the design and implementation of programs and
materials used in the program. Because indirect costs for projects are expensed
as incurred, MCI's profitability in any particular quarter is highly variable.

Program revenues were subject to fluctuation depending on the type and
timing of completed programs. Although repeat customers were not unusual, MCI
was often limited in its ability to estimate the amount of revenues it derived
from a particular customer, as the nature and timing of the customer's program
needs were likely to vary from year to year. See "Risk Factors -- The Combined
Company's Operating Results May Vary and Make Future Profitability Uncertain."

RESULTS OF OPERATIONS -- MCI

The following table sets forth selected financial data and data as a
percentage of net revenues for the periods indicated.

YEARS ENDED DECEMBER 31,
-----------------------------------------------------
1996               1997               1998
---------------    ---------------    ---------------
(IN THOUSANDS, EXCEPT PERCENTAGES)

Net revenues...............................  $33,361   100.0%   $42,294   100.0%   $33,196   100.0%
-------   -----    -------   -----    -------   -----
Gross profit...............................    7,010    21.0     10,572    25.0      7,088    21.0
Selling, general and administrative
expenses.................................    6,571    19.7      9,757    23.1      6,781    20.0
-------   -----    -------   -----    -------   -----
Operating income...........................      439     1.3        815     1.9        307     1.0
Other income (expense).....................        4     0.0        (43)   (0.1)        77     0.2
-------   -----    -------   -----    -------   -----
Net income.................................  $   443     1.3%   $   771     1.8%   $   383     1.2%
=======   =====    =======   =====    =======   =====

YEAR ENDED DECEMBER 31, 1998 COMPARED TO YEAR ENDED DECEMBER 31, 1997 -- MCI

NET REVENUES. Net revenues decreased to $33.2 million in the year ended
December 31, 1998 from $42.2 million in the year ended December 31, 1997, a
decrease of $9.1 million, or 21.5%.

GROSS PROFIT. Cost of revenues consists of direct labor, independent
contractors, food, beverage, entertainment and travel costs. Gross profit
decreased to $7.1 million in the year ended December 31, 1998 from $10.6 million
in the year ended December 31, 1997, a decrease of $3.5 million, or 32.9%. As a
percentage of net revenues, gross margin decreased to 21% in the year ended
December 31, 1998 from 25% in the year ended December 31, 1997. The decrease in
gross margin was primarily due to $735,000 of volume discounts, in the form of
airline override commissions ("discounts"), received in 1997 pursuant to
arrangements with certain airlines, as well as the completion of several low
margin and volume discount programs. The discounts are received in the form of
airline tickets or cash, depending on the airline's choice, and are recorded at
fair

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market value. By eliminating the $735,000 of discounts, the gross margin would
be 23.3% for the year ended December 31, 1997. The balance of the variation is
directly related to product mix changes between 1997 and 1998.

SELLING, GENERAL AND ADMINISTRATIVE. Selling, general and administrative
expenses decreased to $6.8 million in the year ended December 31, 1998 from $9.8
million in the year ended December 31, 1997, a decrease of $3.0 million, or
30.5%. As a percentage of net revenues, selling, general and administrative
expenses decreased to 20.0% of revenue in the year ended December 31, 1998 from
23.1% in the year ended December 31, 1997. Selling, general and administrative
expenses decreased primarily as a result of a salary of $2.2 million paid to the
sole stockholder of MCI in 1997 together with a one-time management information
service cost incurred in connection with the investigation of new systems for
MCI.

OPERATING INCOME. As a result of the factors discussed above, operating
income decreased to $0.3 million in the year ended December 31, 1998 from $0.8
million in the year ended December 31, 1997, a decrease of $0.5 million, or
62.3%. As a percentage of net revenues, operating income decreased to 1.0% in
the year ended December 31, 1998 from 1.9% in the year ended December 31, 1997.

OTHER INCOME (EXPENSE). Other expense increased to $0.1 million in the year
ended December 31, 1998, an increase of $0.1 million from the year ended
December 31, 1997. Other income as a percentage of net revenues, increased to
0.2% in the year ended December 31, 1998 from (0.1)% in the year ended December
31, 1997. The increase is a result of proceeds received from the settlement of
two legal proceedings and other ordinary interest and dividend income.

NET INCOME. As a result of the factors discussed above, net income for the
year ended December 31, 1998 decreased to $0.4 million from $0.8 million in the
year ended December 31, 1997, a decrease of $0.4 million or 50.3%. As a
percentage of net revenues, net income decreased to 1.2% in the year ended
December 31, 1998 from 1.8% in the year ended December 31, 1997.

YEAR ENDED DECEMBER 31, 1997 COMPARED TO YEAR ENDED DECEMBER 31, 1996 -- MCI

NET REVENUES. Net revenues increased to $42.3 million in the year ended
December 31, 1997 from $33.4 million in the year ended December 31, 1996, an
increase of $8.9 million, or 26.8%. The increase in net revenues is due to
increased sales volume and more programs for existing clients.

GROSS PROFIT. Gross profit increased to $10.6 million in the year ended
December 31, 1997 from $7.0 million in the year ended December 31, 1996, an
increase of $3.6 million, or 50.8%, primarily as a result of the increased net
revenues. As a percentage of net revenues, gross margin increased to 25.0% in
the year ended December 31, 1997 from 21.0% in the year ended December 31, 1996.
The increase in gross margin is due primarily to $735,000 of discounts in the
form of airline override commissions received pursuant to arrangements with
certain airlines. The discounts are received in the form of airline tickets or
cash, depending on the airline's choice, and are recorded at fair market value.
In addition, during 1997 management sought to service higher margin programs by
maintaining increased selling prices and controlling direct labor costs.

SELLING, GENERAL AND ADMINISTRATIVE. Selling, general and administrative
expenses increased to $9.8 million in the year ended December 31, 1997 from $6.6
million in the year ended December 31, 1996, an increase of $3.2 million, or
48.5%. As a percentage of net revenues, selling, general and administrative
expenses increased to 23.1% in the year ended December 31, 1997 from 19.7% in
the year ended December 31, 1996. In 1997, MCI recorded approximately $2.2
million in salary expense related to the sole stockholder of MCI.

OPERATING INCOME. As a result of the factors discussed above, operating
income increased to $0.8 million in the year ended December 31, 1997 from $0.4
million in the year ended December 31, 1996, an increase of $0.4 million, or
85.4%. As a percentage of net revenues, operating income increased to 1.9% in
the year ended December 31, 1997 from 1.3% in the year ended December 31, 1996.

NET INCOME. As a result of the factors discussed above, net income
increased to $0.8 million in the year ended December 31, 1997 from $0.4 million
in the year ended December 31, 1996, an increase of $0.4 million, or 74.0%. As a
percentage of net revenues, net income increased to 1.8% in the year ended
December 31, 1997 from 1.3% in the year ended December 31, 1996.

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LIQUIDITY AND CAPITAL RESOURCES -- SPAR COMPANIES AND MCI

The SPAR Companies' working capital (deficiency) was $(12.0 million),
$(2.4) million, $3.4 million and $1.3 million at March 31, 1999, December 31,
1998, March 31, 1998 and 1997, respectively. The SPAR Companies' accounts
receivable levels continue to increase primarily due to increases in sales. The
deficiency at March 31, 1999 is due to increases in property and equipment and
distributions payable to the stockholders.

The SPAR Companies' cash flows from (used by) operations in the three month
period ended March 31, 1999, the nine month period ended December 31, 1998 and
the year ended March 31, 1998 have been $(0.8) million, $5.3 million and $2.6
million, respectively. Financing has been provided during such period through a
$6.0 million line of credit with an unused balance of approximately $2.1 million
at March 31, 1999.

MCI's working capital (deficiency) was $(0.7) million and $(1.9) million at
December 31, 1998 and 1997, respectively. Earnings in 1998 of $.9 million before
depreciation contributed to the improvement in the working capital (deficiency).
Cash and cash equivalents amounted to $1.2 million at December 31, 1998,
compared to $3.7 million at September 30, 1997. Operations for 1998 used cash of
$2.0 million, as accounts payable balances decreased significantly at year end.

The SPAR Companies believe that their available line of credit and cash
generated from operations will be sufficient to fund their investments in
property and equipment and distributions payable to the SPAR Principals. Such
companies believe that the January 15, 1999 purchase of MCI net assets by SMCI
and SMCI's 1999 operations will be financed through a new $3.0 million bank
facility entered into in March 1999 and additional financing arrangements
currently being negotiated.

The MCI Agreement provides for principal payments to MCI totaling $14.2
million through September 15, 1999. MCI may elect to receive up to $3 million of
such consideration in unregistered shares of common stock of any publicly traded
company holding, directly or indirectly, all of the issued and outstanding stock
of SMCI (i.e., in shares of PIA Common Stock), valued at the average public
trading price for the 30 day period preceding September 15, 1999. The MCI
Agreement also provides for contingent Earn-Out Consideration equal to the EBT
of MCI for the period from April 1, 1998 through January 15, 1999, and of SMCI
thereafter through March 31, 1999. MCI is not entitled to any Earn-Out
Consideration if the EBT for such combined periods does not exceed $3.5 million.
The Earn-Out Consideration, if any, could substantially increase the amount due
to MCI.

The SPAR Companies, including SMCI beginning January 15, 1999, believe that
their current level of internally generated funds and their plans for securing
financing will be sufficient to meet their working capital requirements in
fiscal 1999. SPAR Companies including SMCI have no material commitments for
capital expenditures in fiscal 1999 or later. The SPAR Companies, including
SMCI, believe that funds generated from operations in 1999 and beyond will be
sufficient to service existing financing arrangements as well as those currently
under negotiation.

SPAR YEAR 2000 ISSUES

Throughout the United States and the rest of the world, many currently
installed computer systems and software products were constructed or programmed
to accept only two digit entries in their date code fields, making it difficult
or impossible to distinguish dates beginning on or after January 1, 2000, from
dates ending on or prior to December 31, 1999. As a result, in less than a year,
computer systems and/or software used by many companies may need to be upgraded
to deal with such dates, which is often referred to as "Year 2000" compliance.
Significant uncertainty exists concerning the potential effects associated with
such compliance.

SPAR believes that the purchasing patterns of clients and potential clients
may be affected by Year 2000 issues in a variety of ways. Many companies are
expending significant resources to correct or patch their current software
systems for Year 2000 compliance. These expenditures may result in reduced funds
available to purchase services such as those offered by SPAR. Furthermore,
payments for deliveries of components of supplies to SPAR may be delayed,
incomplete, or otherwise unavailable as a consequence of Year 2000 problems
affecting clients or suppliers. Any of the foregoing could result in a material
adverse effect on the business, financial condition and results of operations of
SPAR.

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101

SPAR is currently assessing the readiness of its systems and the systems of
its key customers, suppliers and critical business partners for their compliance
with Year 2000 issues and determining the extent to which it may be vulnerable
if these third parties fail to address Year 2000 issues. These efforts should be
substantially completed during the second half of calendar 1999, which is prior
to any anticipated significant impact on operations.

SPAR currently does not have any contingency plans, but may develop
appropriate contingency plans when and if a significant Year 2000 issue is
identified in any system of SPAR or any interfacing third-party. Depending on
the systems affected, these plans could include accelerated replacement of
affected equipment or software, short to medium-term use of backup equipment and
software, increased work hours for personnel or use of contract personnel to
correct any Year 2000 issues that arise on an accelerated schedule or to provide
manual solutions for information system failures, and similar approaches. If
SPAR fails to develop any required contingency plan, any such contingency plan
is insufficient to deal with the Year 2000 issues, or SPAR is required to
implement any of these contingency plans, it could have a material adverse
effect on SPAR's business, financial results, or results of operations.

Both internal and external resources are being used to assess technologies
and to reprogram or replace technologies that are not compliant with Year 2000,
and to appropriately test Year 2000 modifications. These modifications are being
funded through operating cash flows. The total cost associated with required
modifications to become compliant with Year 2000 is not expected to be material
to the SPAR's financial position. SPAR anticipates expenses of approximately
$100,000 will be incurred in the nine months ending December 31, 1999 to
substantially complete the effort.

SPAR believes that its critical internal systems and procedures will be
tested and substantially compliant before the Year 2000. SPAR believes that the
most reasonably likely worst case scenario facing SPAR with respect to the Year
2000 problems is a lack of compliance on the part of third parties with which it
deals, which may result in lost revenue and profits. These include delays in
deliveries to and from clients due to supply, processing and/or transmission
problems, utility failures, and customer non-compliance (such that customers are
unable to make normal use of SPAR's services and/or are unable to make payments
to SPAR within their normal payment practices). SPAR does not currently
anticipate that any such effects will be of a long-term nature.

Management hopes to identify and resolve all Year 2000 issues that could
have a material adverse effect on SPAR's business or operations in time to avoid
any such material adverse effect. However, management believes that it may not
be possible to determine with any certainty (i) that all Year 2000 issues
affecting SPAR or third parties have been identified or corrected, (ii) how or
when any particular Year 2000 related failure will occur, or (iii) the severity,
duration, or financial consequences of any Year 2000 related failure.
Accordingly, there can be no assurance that SPAR will not suffer from
operational inconveniences and inefficiencies for SPAR and its clients that may
divert management's time and attention and resources from its ordinary business
activities, or even serious system failures that may require significant efforts
by SPAR or its clients to prevent or alleviate material business disruptions, as
a result of Year 2000 issues.

MARKET AND DIVIDEND INFORMATION FOR SPAR

SAI is privately held and there is no established public trading market for
the SAI Common Stock. As of May 1, 1999, SAI had twelve record holders of SAI
Common Stock. Holders of SAI Common Stock acquired their shares directly from
SAI. SAI has never declared or paid any dividends on its capital stock. The SPAR
Marketing Companies and MCI have made, and may in certain instances make, S
corporation distributions to shareholders for, among other things, tax
obligations and reinvestments in affiliate operations.

UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

The following unaudited pro forma combined financial statements for the
year ended December 31, 1998 give effect to the January 15, 1999 acquisition by
SMCI of substantially all the assets of MCI. The MCI Acquisition has been
accounted for using the purchase method of accounting. The following unaudited
pro forma combined financial statements also give effect to the SPAR
Reorganization Transactions and to the plan of merger between SPAR and PIA, a
publicly held company. The SPAR Reorganization Transactions
87

102

will be accounted for as an exchange of shares between commonly owned companies
and the Merger will be accounted for as a reverse merger ("Reverse Merger") with
SPAR deemed to be the accounting acquirer.

The unaudited pro forma combined financial statements reflect the
following: (i) the MCI Acquisition, (ii) the SPAR Reorganization Transactions,
(iii) the Reverse Merger, (iv) adjustments to allocate the purchase price based
upon the estimated fair value of the assets acquired and the obligations
assumed, and (v) a provision for income taxes, as if the SPAR Companies and MCI
had been taxed as a C Corporation (statement of operations only).

The unaudited pro forma combined statements of operations exclude a
one-time, non-cash and non-tax deductible charge which will be based on the
stock price on the Effective Date (approximately $752,000, or $0.04 per combined
pro forma share, based on the average closing price of $2.25 over the six day
trading period ending May 19, 1999) resulting from the grant of 134,114 options
and issuance of 200,000 shares to a consultant of SPAR prior to the Reverse
Merger. The 134,114 options and 200,000 shares are included in determining the
pro forma basic and diluted weighted average number of shares.

The unaudited pro forma combined balance sheet gives effect to the SPAR
Reorganization Transactions and the Reverse Merger as if they had occurred on
March 31, 1999. The unaudited pro forma combined statement of operations for the
year ended December 31, 1998 includes the operating results of the SPAR
Companies, MCI and PIA for the year ended December 31, 1998 and gives effect to
the MCI Acquisition and the Reverse Merger as if they had occurred at the
beginning of the period. The unaudited pro forma combined statement of
operations for the three month period ended March 31, 1999, reflects the
operating results of the SPAR Companies and PIA for the three months ended March
31, 1999. The SPAR Companies had a fiscal year of March 31. Effective April 1,
1998, the SPAR Companies changed its fiscal year to December 31. MCI had a
fiscal year ending December 31. PIA has a fiscal year ending December 31. For
purposes of the twelve-month period ended December 31, 1998 unaudited pro forma
combined statement of operations, operating results for the SPAR Companies
include the nine-month period ended December 31, 1998 plus the three-month
period ended March 31, 1998. The SPAR three-month period ended March 31, 1998
included net revenues of $9,602,000 and net income of $1,731,000. The SPAR
three-month period ended March 31, 1999 includes the operations of MCI from the
date of acquisition, January 15, 1999.

The pro forma adjustments are based on estimates, available information and
certain assumptions and may be revised as additional information becomes
available. The pro forma financial data do not purport to represent what SPAR's
financial position or results of operations would actually have been if such
transactions in fact had occurred on those dates and are not necessarily
representative of SPAR's financial position or results of operations for any
future period. Since PIA and SPAR were not under common control or management,
historical combined results may not be comparable to, or indicative of, future
performance. The unaudited pro forma combined financial statements should be
read in conjunction with the financial statements and notes thereto included
elsewhere in this Proxy Statement or incorporated by reference herein.

88

103

SPAR

UNAUDITED PRO FORMA COMBINED BALANCE SHEET
MARCH 31, 1999
(IN THOUSANDS)

ASSETS

SPAR                  PRO FORMA     PRO FORMA
COMPANIES     PIA      ADJUSTMENTS    COMBINED
---------   --------   ------------   ---------
(SEE NOTE 5)

Current assets:
Cash and cash equivalents.........................   $ 1,980    $  7,408     $     --      $ 9,388
Accounts receivable, net..........................    14,609      11,356           --       25,965
Prepaid program costs.............................     2,570          --           --        2,570
Prepaid expenses and other current assets.........       812         691           --        1,503
Due from affiliates...............................       177          --           --          177
-------    --------     --------      -------
Total current assets......................    20,148      19,455           --       39,603
Property and equipment, net.........................     1,552       1,771       (1,671)       1,652
Goodwill, net.......................................    12,140          --       12,013       24,153
Investment in affiliate.............................        --         570           --          570
Other assets........................................       302         369           --          671
-------    --------     --------      -------
Total assets..............................   $34,142    $ 22,165     $ 10,342      $66,649
=======    ========     ========      =======

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Accounts payable..................................   $ 2,046    $    996     $     --      $ 3,042
Accrued expenses and other current liabilities....     4,901       7,662        9,434       21,997
Deferred revenue..................................     4,086          --           --        4,086
Line of credit and note payable...................     3,187          --           --        3,187
Other long-term debt, current portion.............     1,376          --           --        1,376
Distribution and other amounts due to SPAR
stockholders...................................     7,399          --       (1,773)       5,626
Due to affiliates.................................       356          --           --          356
Note payable to MCI...............................     8,790          --           --        8,790
-------    --------     --------      -------
Total current liabilities.................    32,141       8,658        7,661       48,460
Line of credit and other long-term debt.............     2,338       2,090           --        4,428
-------    --------     --------      -------
Total liabilities.........................    34,479      10,748        7,661       52,888
Shareholders' equity:
Common stock......................................        --          60          120          180
Additional paid-in capital........................        --      30,744      (16,074)      14,670
Accumulated earnings (deficit)....................      (337)    (19,387)      18,635       (1,089)
-------    --------     --------      -------
Total liabilities and stockholders'
equity..................................   $34,142    $ 22,165     $ 10,342      $66,649
=======    ========     ========      =======

See Notes to the Unaudited Pro Forma Combined Financial Statements
89

104

SPAR

UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1998
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

PRO FORMA
PURCHASE         PRO                                        PRO
SPAR                  ACCOUNTING       FORMA                     PRO FORMA        FORMA
COMPANIES     MCI      ADJUSTMENTS      COMBINED       PIA        ADJUSTMENTS      COMBINED
---------   -------   --------------   ----------   ----------   --------------   ----------
(SEE NOTE 3)                               (SEE NOTE 6)

Net revenues..........   $42,202    $33,196      $    --       $  75,398    $  121,788      $    --       $  197,186
Cost of revenues......    21,054     26,108           --          47,162       105,448           --          152,610
-------    -------      -------       ----------   ----------      -------       ----------
Gross profit..........    21,148      7,088           --          28,236        16,340           --           44,576
Selling, general and
administrative
expenses............    13,058      6,781          325          20,164        21,162           --           41,326
Goodwill
amortization........        --         --          821             821            --          801            1,622
-------    -------      -------       ----------   ----------      -------       ----------
Operating income......     8,090        307       (1,146)          7,251        (4,822)        (801)           1,628
Interest expense
(income)............       399        (77)       1,262           1,584          (462)          --            1,122
Other (income)
expense.............      (149)        --           --            (149)         (149)          --             (298)
-------    -------      -------       ----------   ----------      -------       ----------
Income (loss) before
income tax
provision...........     7,840        384       (2,408)          5,816        (4,211)        (801)             804
Income tax provision
(benefit)...........        --         --        2,146           2,146            55       (1,609)             592
-------    -------      -------       ----------   ----------      -------       ----------
Net income (loss).....   $ 7,840    $   384      $(4,554)      $   3,670    $   (4,266)     $   808       $      212
-------    -------      -------       ----------   ----------      -------       ----------
Net income (loss) per
share:
Basic...............                                         $    0.29    $    (0.78)                   $     0.01
==========   ==========                    ==========
Diluted.............                                         $    0.29    $    (0.78)                   $     0.01
==========   ==========                    ==========
Shares used in
computing pro forma
net income (loss)
per share:
Basic...............                                         12,654,807    5,439,000                    18,135,773
==========   ==========                    ==========
Diluted.............                                         12,788,921    5,439,000                    18,135,773
==========   ==========                    ==========

See Notes to the Unaudited Pro Forma Combined Financial Statements
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105

SPAR

UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
THREE MONTH PERIOD ENDED MARCH 31, 1999
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

PRO FORMA
PURCHASE        PRO                                     PRO
SPAR               ACCOUNTING      FORMA                   PRO FORMA       FORMA
COMPANIES    MCI    ADJUSTMENTS     COMBINED       PIA      ADJUSTMENTS     COMBINED
---------   -----   ------------   ----------   ---------   ------------   ----------
(SEE NOTE 3)                            (SEE NOTE 6)

Net revenues.................   $21,637    $ 765     $    --      $   22,402   $  21,626      $   --      $   44,028
Cost of revenues.............    14,373      503          --          14,876      20,069          --          34,945
-------    -----     -------      ----------   ---------      ------      ----------
Gross profit.................     7,264      262          --           7,526       1,557          --           9,083
Selling, general and
administrative expenses....     4,780      376          --           5,156       4,947          --          10,103
Goodwill amortization........       171       --          --             171          --         200             371
-------    -----     -------      ----------   ---------      ------      ----------
Operating income.............     2,313     (114)         --           2,199      (3,390)       (200)          1,391
Interest expense (income)....       416       --          49             465         (90)         --             375
Other (income) expense.......       (45)      --          --             (45)         --          --             (45)
-------    -----     -------      ----------   ---------      ------      ----------
Income (loss) before income
tax provision..............     1,942     (114)        (49)          1,779      (3,300)       (200)         (1,721)
Income tax provision
(benefit)..................        --       --         657             657          15        (657)             15
-------    -----     -------      ----------   ---------      ------      ----------
Net income (loss)............   $ 1,942    $(114)    $  (706)     $    1,122   $  (3,315)     $  457      $   (1,736)
=======    =====     =======      ==========   =========      ======      ==========
Net income (loss) per share:
Basic......................                                     $     0.09   $   (0.60)                 $    (0.10)
==========   =========                  ==========
Diluted....................                                     $     0.09   $   (0.60)                 $    (0.10)
==========   =========                  ==========
Shares used in computing pro
forma net income (loss) per
share
Basic......................                                     12,654,807   5,480,966                  18,135,773
==========   =========                  ==========
Diluted....................                                     12,788,921   5,480,966                  18,135,773
==========   =========                  ==========

See Notes to the Unaudited Pro Forma Combined Financial Statements.
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106

SPAR

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

1. GENERAL

The historical financial statements reflect the financial position and
results of operations of the SPAR Companies, MCI and PIA (individually, the
"Company," and collectively, the "Companies") and were derived from the
respective Companies' financial statements as indicated. The unaudited pro forma
combined financial statements should be read in connection with the audited
historical financial statements and notes thereto of the SPAR Companies (nine
months ended December 31, 1998), MCI (year ended December 31, 1998) and PIA
(year ended December 31, 1998) and the unaudited historical financial statements
of SPAR Companies for the three months ended March 31, 1998. The historical
financial statements included elsewhere herein for each of the Companies, have
been included in accordance with Rule 3-05 of Regulation S-X.

The historical results of operations of the SPAR Companies for the
twelve-month period ended December 31, 1998 includes the nine-month period ended
December 31, 1998 plus the three-month period ended March 31, 1998.

The historical results of operations of the SPAR Companies for the
three-month period ended March 31, 1999 includes the operations of SMCI from
January 15, 1999, the date of such acquisition. (See Note 2).

The historical results of operations of MCI for the three-month period
ended March 31, 1999 includes the operations of MCI from January 1, 1999 to
January 15, 1999, the date of sale to SMCI. (See Note 2).

2. MCI ACQUISITION

On January 15, 1999, SMCI acquired substantially all the assets of MCI. The
transaction accounted for as a purchase, consisted of consideration of
$1,800,000 cash and a $12,422,189 note payable to the seller.

The purchase price has been allocated to MCI's historical assets and
liabilities based on their respective carrying values, as these carrying values
are deemed to represent fair market values of these assets and liabilities.
Additionally, adjustments have been made for assets not purchased and debt and
other liabilities not assumed in the transaction for purposes of determining the
excess of the purchase price over the fair value of the net assets acquired. The
total purchase consideration does not reflect contingent consideration related
to earn-out arrangements included in the MCI Agreement. The MCI Agreement
provides for a post-closing adjustment whereby additional contingent
consideration will be payable to MCI in the event that EBT exceeds $3,500,000.
The allocation of the purchase price is considered preliminary.

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SPAR

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

3. MCI UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS ADJUSTMENTS

The following table summarizes unaudited pro forma combined statement of
operations adjustments.

PURCHASE ACCOUNTING ADJUSTMENTS
---------------------------------    PRO FORMA
(A)     (B)      (C)       (D)     ADJUSTMENTS
-----   -----   -------   -------   -----------

YEAR ENDED DECEMBER 31, 1998
Net revenues....................................  $  --   $  --   $    --   $    --     $    --
Cost of revenues................................     --      --        --        --          --
Selling, general and administrative expenses....    325      --        --        --         325
Goodwill amortization...........................     --     821        --        --         821
-----   -----   -------   -------     -------
Operating income (loss).........................   (325)   (821)       --        --      (1,146)
Interest (income) expense.......................     --      --     1,262        --       1,262
Other (income) expense..........................     --      --        --        --          --
-----   -----   -------   -------     -------
Income (loss) before income tax provision.......   (325)   (821)   (1,262)       --      (2,408)
Income tax provision............................     --      --        --     2,146       2,146
-----   -----   -------   -------     -------
Net income (loss)...............................  $(325)  $(821)  $(1,262)  $(2,146)    $(4,554)
=====   =====   =======   =======     =======
THREE-MONTH PERIOD ENDED MARCH 31, 1999
Net revenues....................................  $  --   $  --   $    --   $    --     $    --
Cost of revenues................................     --      --        --        --          --
Selling, general and administrative expenses....     --      --        --        --          --
Goodwill amortization...........................     --      --        --        --          --
-----   -----   -------   -------     -------
Operating income (loss).........................     --      --        --        --          --
Interest expense................................     --      --        49        --          49
Other (income) expense..........................     --      --        --        --          --
-----   -----   -------   -------     -------
Income (loss) before income tax provision.......     --      --       (49)       --         (49)
Income tax provision............................     --      --        --       657         657
-----   -----   -------   -------     -------
Net income (loss)...............................  $  --   $  --   $   (49)  $  (657)    $  (706)
=====   =====   =======   =======     =======

---------------
(a) Reflects the increase in salaries, bonuses and benefits to new management of
MCI as scheduled from the employment agreements that have been entered into
or that will be entered into upon consummation of the MCI Acquisition.

(b) Reflects the amortization of goodwill to be recorded as a result of the MCI
Acquisition over a 15-year estimated life.

(c) Reflects the increase in interest expense resulting from the increase of
outstanding debt and distributions payable by the Company:

THREE-MONTH
YEAR ENDED         PERIOD ENDED
DECEMBER 31, 1998    MARCH 31, 1998
-----------------    --------------

SPAR interest expense at a rate of 7.75% on
$8,790 note payable to MCI..................       $  681               $25
SPAR interest expense at a rate of 7.75% on
$7,400 of the amounts due to the owners of
SPAR........................................          581                24
------               ---
$1,262               $49
======               ===

(d) Reflects the incremental provision for federal and state income taxes
assuming all entities were subject to federal and state income tax and
relating to the other statements of operations' adjustments and for income
taxes on S corporation income, assuming a corporate income tax rate of
36.9%.

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SPAR

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

4. PIA REVERSE MERGER

In 1999, SPAR, through SAI, its newly formed parent, will complete the
Reverse Merger with PIA. The transaction will be accounted for as a purchase
with SPAR being treated as the accounting acquirer.

The estimated purchase price has been allocated based on the estimated fair
value of PIA assets acquired. The allocation of the purchase price is considered
preliminary until such time as the closing of the transaction.

5. PIA UNAUDITED PRO FORMA COMBINED BALANCE SHEET ADJUSTMENTS

The following table summarizes unaudited pro forma combined balance sheet
adjustments (in thousands).

REVERSE MERGER ADJUSTMENTS
---------------------------              PRO FORMA
(A)       (B)      (C)       (D)     ADJUSTMENTS
---------   ------   ------   -------   -----------

ASSETS
Property and equipment, net..................  $ (1,671)   $  --    $  --    $    --    $ (1,671)
Goodwill, net................................    12,013       --       --         --      12,013
--------    -----    -----    -------    --------
Total assets.......................  $ 10,342    $  --    $  --    $    --    $ 10,342
========    =====    =====    =======    ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accrued expenses...........................  $  9,434    $  --    $  --    $    --    $  9,434
Distribution and other amounts due to SPAR
Stockholders............................        --       --       --     (1,773)     (1,773)
--------    -----    -----    -------    --------
Total current liabilities..........     9,434       --       --     (1,773)      7,661
Stockholders' equity:
Common stock...............................        (5)      --      125         --         120
Additional paid-in capital.................   (18,474)     752     (125)     1,773     (16,074)
Retained earnings (deficit)................    19,387     (752)      --         --      18,635
--------    -----    -----    -------    --------
Total stockholders' equity.........       908       --       --      1,773       2,681
--------    -----    -----    -------    --------
Total liabilities and stockholders'
equity...........................  $ 10,342    $  --    $  --    $    --    $ 10,342
========    =====    =====    =======    ========

(a)  Records the purchase accounting for the Reverse Merger of SPAR with PIA.
PIA's market value, for purposes of these pro forma adjustments has been
established at $12,325. This is based on using the number of shares held
prior to and to be retained in the transaction by PIA shareholders
multiplied by the average closing market price of PIA's stock over six
trading days ending on May 19, 1999. The goodwill that will result from the
Reverse Merger is calculated after giving effect to the following: (1) the
PIA merger costs that are accrued from April 3, 1999 through closing
estimated at $1,388, (ii) restructuring costs that are directly related to
the merger estimated at $9,117, plus (iii) any SPAR merger related costs to
be incurred through the closing estimated at $600. The amounts allocated on
a preliminary basis to goodwill may be allocated to other identifiable
intangible assets, such as customer lists, resulting in different
amortization periods. However, management does not anticipate such amounts
to be material.

PIA's restructure cost is composed of committed costs that will be
eliminated during the integration of the SPAR Companies and PIA's field
organizations and the consolidation of administrative functions as required
to achieve beneficial synergies and cost savings.

PIA restructuring costs include $1,671 for assets deemed to be redundant,
$2,757 for property and equipment lease settlements, $3,971 for severance
pay and other employee benefit obligations and $718 for other termination
fees for contracts that are deemed to be redundant. PIA will record any

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109

SPAR

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

5. PIA UNAUDITED PRO FORMA COMBINED BALANCE SHEET ADJUSTMENTS (CONTINUED)
termination costs on its books in accordance with EITF 95-3 Recognition of
Liabilities in Connection with a Business Combination.

(b)  Records the one-time, non-cash, non-tax deductible charge of approximately
$752 (based on average closing market price per share of $2.25 over the six
trading day period ending on May 19, 1999) resulting from the grant of
134,114 options at $0.01 per share and issuance of 200,000 shares to a
consultant of SPAR prior to this Reverse Merger.

(c)  Records the par value of SPAR's shares that are to be issued and
outstanding and prior to the Reverse Merger with PIA.

(d)  Reflects the minimum net worth of the SPAR Companies at the time of closing
as required in the revised merger agreement with PIA.

6. PIA UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS ADJUSTMENTS

The following table summarizes unaudited pro forma combined statement of
operations adjustments (in thousands).

REVERSE MERGER
ADJUSTMENTS
----------------     PRO FORMA
(A)       (B)      ADJUSTMENTS
-----    -------    -----------

YEAR ENDED DECEMBER 31, 1998

Net revenues................................................  $  --    $    --      $    --
Cost of revenues............................................     --         --           --
Selling, general and administrative expenses................     --         --           --
Goodwill amortization.......................................   (801)        --         (801)
-----    -------      -------
Operating income (loss).....................................   (801)        --         (801)
Other (income) expense......................................     --         --           --
-----    -------      -------
Income (loss) before income tax provision...................   (801)        --         (801)
Income tax provision (benefit)..............................     --     (1,609)      (1,609)
-----    -------      -------
Net income (loss)...........................................  $(801)   $ 1,609      $   808
=====    =======      =======
THREE-MONTH PERIOD ENDED MARCH 31, 1999
Net revenues................................................  $  --    $    --      $    --
Cost of revenues............................................     --         --
Selling, general and administrative expenses................     --         --           --
Goodwill amortization.......................................    200         --          200
-----    -------      -------
Operating income (loss).....................................   (200)        --         (200)
Interest expense............................................     --         --           --
Other (income) expense......................................     --         --           --
-----    -------      -------
Income (loss) before income tax provision...................   (200)        --         (200)
Income tax provision (benefit)..............................     --       (657)        (657)
-----    -------      -------
Net income (loss)...........................................  $(200)   $   657      $   457
=====    =======      =======

---------------
(a) Reflects the amortization of goodwill to be recorded as a result of the
Reverse Merger over a 15-year estimated life.

(b) Reflects the reversal of the provision for federal and state income taxes
assuming the losses of PIA, excluding non-deductible PIA goodwill, would be
used to offset the income of SPAR.

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110

SPAR

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

7. PER SHARE DATA

Pro forma net income (loss) per share, basic and diluted, has been prepared
using the following assumptions: (i) the number of shares of PIA Common Stock
issued and outstanding at the date of closing is estimated to be approximately
5,480,966; and (ii) the Amended Exchange Ratio (as defined) is based upon the
product of 2.3333 times the number of issued and outstanding shares of PIA
Common Stock. Therefore, at the date of closing, SAI Stockholders will exchange
their SAI shares for approximately 12,654,807 shares of PIA Common Stock and SAI
option holders will receive approximately 134,114 options that will be
exercisable into PIA Common Stock at $0.01 per share at various dates to be
determined.

For purposes of computing pro forma basic and diluted earnings per share,
all SAI stock and SAI options that will be owned by SAI Stockholders immediately
prior to the merger transaction have been treated as though they were
outstanding from the beginning of the respective period presented in the
unaudited pro forma combined statement of operations.

The diluted weighted average number of shares outstanding does not include
any anti-dilutive effects upon conversion of options outstanding.

8. PIA NONRECURRING CHARGES

The year ended December 31, 1998 unaudited pro forma combined statement of
operations includes $1,038 of nonrecurring charges recorded by PIA. These
charges include $839 of purchased consulting services related to the Company's
redirection of its technology strategy, and $250 in merger transaction costs.

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111

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS OF PIA

PRIOR TO THE MERGER

The following table sets forth certain information regarding beneficial
ownership of the PIA Common Stock as of June 7, 1999 by: (i) each person (or
group of affiliated persons) who is known by PIA to own beneficially more than
5% of PIA Common Stock; (ii) each of PIA's directors; (iii) each of the
executive officers named in the Summary Compensation Table; and (iv) PIA's
directors and executive officers as a group. Except as indicated in the
footnotes to this table, the persons named in the table, based on information
provided by such persons, have sole voting and sole investment power with
respect to all shares of PIA Common Stock shown as beneficially owned by them,
subject to community property laws where applicable.

BENEFICIAL OWNERSHIP OF PIA
COMMON STOCK
PRIOR TO THE MERGER
--------------------------------
NAME AND ADDRESS OF BENEFICIAL OWNER              NUMBER OF SHARES      PERCENTAGE
------------------------------------              ----------------      ----------

Riordan, Lewis & Haden(1)...................................     1,637,151(2)          29.7%
300 S. Grand Avenue, 29th Floor
Los Angeles, California 90071
Clinton E. Owens(3).........................................       615,802(4)          11.0
Heartland Advisors, Inc.....................................     1,423,800(5)          26.0
790 North Milwaukee Street
Milwaukee, Wisconsin 53202
California Community Foundation.............................       480,872(6)           8.7
606 S. Olive Street, Suite 2400
Los Angeles, California 90014
Terry R. Peets(3)...........................................       165,000(7)           2.0
Cathy L. Wood(3)............................................        63,500(8)             *
Donald H. Holman(3).........................................        18,594(9)             *
John R. Bain(3).............................................         8,750(10)            *
Patrick W. Collins(3).......................................         2,500(11)            *
John A. Colwell(3)..........................................        68,511(12)          1.2
Joseph H. Coulombe(3).......................................        19,810(13)            *
Patrick C. Haden............................................     1,642,651(14)         29.8
300 S. Grand Avenue, 29th Floor
Los Angeles, California 90071
J. Christopher Lewis........................................     1,642,651(15)         29.8
300 S. Grand Avenue, 29th Floor
Los Angeles, California 90071
All directors and executive officers as a group (11
persons)..................................................     2,636,699             44.3%

---------------
*  Less than 1%.

(1) Shares are owned by RVM/PIA, a California limited partnership managed by
Riordan, Lewis & Haden ("RLH").

(2) Includes 29,729 shares issuable upon exercise of certain warrants to
purchase PIA Common Stock owned by RLH.

(3) The address of such persons is c/o PIA Merchandising Services, Inc., 19900
MacArthur Boulevard, Suite 900, Irvine, California 92718.

(4) Includes 498,394 shares held by Clinton E. and Mary Ann Owens as Trustees
of The Owens Family Trust dated June 20, 1994, 9,300 shares held by Clinton
E. Owens as Trustee of the Welch Trust for Marcia Browning and 108,108
shares issuable upon the exercise of options which are exercisable as of,
or will become exercisable within 60 days of, June 7, 1999.

(5) All information regarding share ownership is taken from and furnished in
reliance upon the Schedule 13G (Amendment No. 4), dated January 28, 1999,
filed by Heartland Advisors, Inc. with the Securities and Exchange
Commission on February 2, 1999.

(6) All information regarding share ownership is taken from and furnished in
reliance upon Schedule 13G (Amendment No. 2), dated February 12, 1999,
filed by California Community Foundation with the

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112

Securities and Exchange Commission on February 12, 1999. Includes 66,666
shares issuable upon exercise of a warrant to purchase PIA Common Stock.

(7) Includes 125,000 shares issuable upon the exercise of options which are
exercisable as of, or will become exercisable within 60 days of, June 7,
1999.

(8) Includes 62,500 shares issuable upon the exercise of options which are
exercisable as of, or will become exercisable within 60 days of, June 7,
1999.

(9) Includes 17,432 shares issuable upon the exercise of options which are
exercisable as of, or will become exercisable within 60 days of, June 7,
1999.

(10) Includes 8,750 shares issuable upon the exercise of options which are
exercisable as of, or will become exercisable within 60 days of, June 7,
1999.

(11) Includes 2,500 shares issuable upon the exercise of options which are
exercisable as of, or will become exercisable within 60 days of, June 7,
1999.

(12) Includes 65,706 shares issuable upon the exercise of options which are
exercisable as of, or will become exercisable within 60 days of, June 7,
1999 (which is inclusive of 1,500 shares underlying options that are
exercisable if Mr. Colwell remains a director of PIA until the Annual
Meeting).

(13) Includes 6,905 shares held by Joseph H. Coulombe as Trustee of The Coulombe
Family Trust dated July 26, 1980 and 12,905 shares issuable upon the
exercise of options which are exercisable as of, or will become exercisable
within 60 days of, June 7, 1999 (which is inclusive of 1,500 shares
underlying options that are exercisable if Mr. Coulombe remains a director
of PIA until the Annual Meeting).

(14) Includes 1,637,151 shares (including 29,729 shares issuable upon exercise
of warrants) owned by RLH. Mr. Haden, a director of PIA, may be deemed to
share voting and investment power with respect to all such shares as a
general partner of RLH. No other person, other than J. Christopher Lewis, a
director of PIA, has voting power or investment power with respect to such
shares. Also includes 5,500 shares issuable upon the exercise of options
held by Mr. Haden which are exercisable as of, or will become exercisable
within 60 days of, June 7, 1999 (which is inclusive of 1,500 shares
underlying options that are exercisable if Mr. Haden remains a director of
PIA until the Annual Meeting).

(15) Includes 1,637,151 shares (including 29,729 shares issuable upon exercise
of warrants) owned by RLH. Mr. Lewis, a director of PIA, may be deemed to
share voting and investment power with respect to all such shares as a
general partner of RLH. No other person, other than Patrick C. Haden, a
director of PIA, has voting power or investment power with respect to such
shares. Also includes 5,500 shares issuable upon the exercise of options
held by Mr. Lewis which are exercisable as of, or will become exercisable
within 60 days of, June 7, 1999 (which is inclusive of 1,500 shares
underlying options that are exercisable if Mr. Lewis remains a director of
PIA until the Annual Meeting).

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SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS OF THE COMBINED COMPANY FOLLOWING THE MERGER

The following table sets forth certain information with respect to the
beneficial ownership of PIA Common Stock outstanding as of June 7, 1999, giving
effect to the SPAR Reorganization Transactions and the issuance of shares of PIA
Common Stock in the Merger and assuming the Merger occurs in July 1999, by: (i)
each person who will beneficially own five percent or more of the outstanding
shares of PIA Common Stock following the Merger; (ii) each person who will serve
as a director of PIA following the Merger; (iii) each person who will serve as
an executive officer of the Combined Company following the Merger; and (iv) all
persons who will serve as executive officers or directors of the Combined
Company following the Merger as a group.

NUMBER OF SHARES
OF PIA COMMON STOCK
BENEFICIALLY OWNED
NAME OF BENEFICIAL OWNER                     AFTER THE MERGER      PERCENTAGE
------------------------                    -------------------    ----------

Robert O. Aders.............................................              --              --
Robert G. Brown.............................................       7,554,103(1)         41.7%
William H. Bartels..........................................       4,804,703            26.5
Patrick W. Collins..........................................          11,500(2)            *
J. Christopher Lewis........................................       1,644,151(3)          9.0
Terry R. Peets..............................................         307,500(4)          1.7
James H. Ross...............................................          42,418(5)            *
Cathy L. Wood...............................................         116,000(6)            *
Riordan, Lewis & Haden(7)...................................       1,637,151(8)          9.0
Heartland Advisors, Inc.....................................       1,423,800(9)          7.9
All directors and executive officers as a group(8)..........      14,480,375            77.8%

---------------
*  Less than 1%.

(1) Includes 1,800,000 shares held by a grantor trust for the benefit of certain
family members of Robert G. Brown over which each of Robert G. Brown, James
R. Brown, Sr. and William H. Bartels is a trustee, and 180,000 shares held
by a grantor trust for the benefit of certain other family members of Robert
G. Brown over which each of Robert G. Brown, James R. Brown, Sr. and William
H. Bartels is a trustee.

(2) Includes 11,500 shares issuable upon the exercise of options in connection
with the Merger (which is inclusive of 1,500 shares underlying options that
will be granted to Mr. Collins if he is elected a director at the Annual
Meeting).

(3) Includes 1,637,151 shares (including 29,729 shares issuable upon exercise of
warrants) owned by RLH. Mr. Lewis, a director of PIA, may be deemed to share
voting and investment power with respect to all such shares as a general
partner of RLH. No other person, other than Patrick C. Haden, a director of
PIA, has voting power or investment power with respect to such shares. Also
includes 7,000 shares issuable upon the exercise of options held by Mr.
Lewis in connection with the Merger (which is inclusive of 1,500 shares
underlying options that will be granted to Mr. Lewis if he is elected a
director at the Annual Meeting).

(4) Includes 125,000 shares issuable upon the exercise of options which are
exercisable as of, or will become exercisable within 60 days of, June 7,
1999 and an additional 142,500 shares issuable upon exercise of options
which exercise date will be accelerated by two years upon the consummation
of the Merger.

(5) Includes 42,418 shares issuable upon the exercise of options in connection
with the Merger.

(6) Includes 62,500 shares issuable upon the exercise of options which are
exercisable as of, or will become exercisable within 60 days of, June 7,
1999 and an additional 52,500 shares issuable upon exercise of options which
exercise date will be accelerated by two years upon the consummation of the
Merger.

(7) Shares are owned by RVM/PIA, a California limited partnership managed by
RLH.

(8) Includes 29,729 shares issuable upon exercise of certain warrants to
purchase PIA Common Stock owned by RLH.

(9) All information regarding share ownership is taken from and furnished in
reliance upon the Schedule 13G (Amendment No. 4), dated January 28, 1999,
filed by Heartland Advisors, Inc. with the Securities and Exchange
Commission on February 2, 1999.
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114

PROPOSAL II: CHARTER AMENDMENT NO. 1

The PIA Board has approved and adopted, subject to stockholder approval,
Charter Amendment No. 1 which provides for the amendment to PIA's Certificate of
Incorporation to increase the number of authorized shares of PIA Common Stock
from 15 million to 47 million. The text of Charter Amendment No. 1 is set forth
in Annex B-1 to this Proxy Statement; however, such text is subject to change as
may be required by the Delaware Secretary of State.

REASONS FOR CHARTER AMENDMENT NO. 1

Charter Amendment No. 1 is necessary to effectuate the Merger and the
Share/Option Issuance. At the close of business on June 7, 1999, the Record
Date, there were 5,480,966 shares of PIA Common Stock outstanding and entitled
to vote. If the Merger is consummated, then the Combined Company will be
required to issue approximately 12,788,920 shares of PIA Common Stock (based on
the number of shares outstanding on the Record Date and assuming exercise of all
Substitute Options without regard to vesting). Based on such assumptions, if the
Share/Option Issuance, each of the Pre-Merger Charter Amendments (including
Charter Amendment No. 1) and the Option Plan Amendment are approved, following
the Merger, the Combined Company would have available for future issuance
approximately 28.7 million authorized shares of PIA Common Stock. Of such
authorized but unissued shares, approximately 3.9 million shares of PIA Common
Stock (as of the close of business on the Record Date) would be reserved for
issuance under the Combined Company's employee benefit plans after giving effect
to the Option Plan Amendment (which is inclusive of the shares of PIA Common
Stock reserved for issuance for option grants to SPAR employees and other
persons providing valuable services for SPAR to be made following the
consummation of the Merger).

PIA currently has an insufficient number of authorized but unissued and
unreserved shares of PIA Common Stock to effect the Merger and the Share/Option
Issuance pursuant to the Merger Agreement. As a result, the PIA Board believes
it is desirable to authorize additional shares of PIA Common Stock so that there
will be sufficient shares available for the Share/Option Issuance in the Merger,
as well as for issuance after the Merger for purposes that the PIA Board may
hereafter determine to be in the best interests of the Combined Company and its
stockholders. Such purposes could include the offer of shares for cash,
acquisitions, financings, mergers, stock splits or dividends, employee benefit
programs and other general corporate purposes. No further action or
authorization by the PIA stockholders would be necessary prior to the issuance
of additional shares of the PIA Common Stock unless required by the PIA
Certificate of Incorporation or by applicable law or regulation. The terms of
any future issuance of shares of PIA Common Stock will depend largely on market
and financial conditions and other factors existing at the time of issuance.

Other than in connection with the Share/Option Issuance, and the issuance
of a maximum of up to 2,133,744 options to SPAR employees and other persons
providing valuable services to SPAR in connection with the Merger and PIA's
employee benefit plans, PIA does not have any immediate plans, agreements,
arrangements, commitments or understandings with respect to the issuance of any
of the additional shares of PIA Common Stock that would be authorized by Charter
Amendment No. 1; provided, that the Combined Company may be required to issue
shares of PIA Common Stock valued at up to $3 million to MCI as the final
installment payment on the MCI Note if such payment is requested by MCI under
the terms and provisions of the MCI Note. The number of shares issued to MCI
will equal the amount of the final installment payment to MCI (up to $3 million)
divided by the average trading price of PIA Common Stock calculated over the 30
trading day period preceding the maturity date (September 15, 1999 at the
latest).

PRINCIPAL EFFECTS

Under Delaware law, the additional shares of PIA Common Stock to be
authorized by Charter Amendment No. 1 (including the Merger Shares) would have
rights and privileges identical to those of the currently outstanding PIA Common
Stock. The Merger Shares, however, will be subject to resale restrictions
imposed by the Securities Act. However, as discussed in "Proposal I:
Share/Option Issuance -- Stock Ownership following the Merger," the Merger will
increase the number of shares of PIA Common Stock outstanding by over 200% and
will result in a change of control of PIA. Other than with respect to the Merger
and the Share/Option Issuance, the adoption of Charter Amendment No. 1 would not
affect the rights of the holders of currently outstanding PIA Common Stock,
except for effects incidental to increasing the number of

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115

shares of PIA Common Stock outstanding upon the issuance of newly authorized
shares of PIA Common Stock. Charter Amendment No. 1 will increase the total
number of authorized shares of PIA Common Stock by an amount substantially
greater than that necessary to effect the Share/Option Issuance and the Merger.
As a result, PIA stockholders could experience a greater reduction in their
interest in PIA with respect to earnings per share, voting, liquidation value
and book and market value per share if additional authorized shares of PIA
Common Stock are issued. The availability for issuance of additional shares of
the PIA Common Stock could also enable the PIA Board to render more difficult or
discourage an attempt to obtain control of PIA in the future. For example, the
issuance of shares in a public or private sale, merger or similar transaction
would increase the number of outstanding shares, thereby possibly diluting the
interest of a party attempting to obtain control of PIA. If Charter Amendment
No. 1 is approved by the PIA stockholders, it will become effective upon filing
of a Certificate of Amendment to PIA's Certificate of Incorporation with the
Delaware Secretary of State, which is expected to be filed promptly after the
Annual Meeting.

VOTE REQUIRED

Approval of Charter Amendment No. 1 requires the affirmative vote of a
majority of the shares of PIA Common Stock outstanding as of the Record Date.
Approval of the Share/Option Issuance, each of the three Pre-Merger Charter
Amendments, the Reverse Split Proposal and the Option Plan Amendment is required
for the Merger to be consummated. If any one of the foregoing six proposals is
not approved, even if the other five proposals are approved, the Merger cannot
be consummated and none of the six proposals will be approved. The PIA Board has
unanimously determined that Charter Amendment No. 1 is advisable and in the best
interests of PIA and the stockholders of PIA. THE PIA BOARD UNANIMOUSLY
RECOMMENDS THAT THE PIA STOCKHOLDERS VOTE "FOR" APPROVAL OF CHARTER AMENDMENT
NO. 1.

PROPOSAL III: CHARTER AMENDMENT NO. 2

The PIA Board has approved and adopted, subject to stockholder approval,
Charter Amendment No. 2 which provides for the amendment to PIA's Certificate of
Incorporation to remove the prohibition on stockholders taking action by written
consent without a meeting under Delaware law. The text of Charter Amendment No.
2 is set forth in Annex B-2 to this Proxy Statement; however, such text is
subject to change as may be required by the Delaware Secretary of State.

REASONS FOR CHARTER AMENDMENT NO. 2 AND PRINCIPAL EFFECTS

The Merger Agreement requires that the PIA stockholders approve Charter
Amendment No. 2 which provides for the deletion of Article Tenth (which
presently states that no action required to be taken or that may be taken at any
annual or special meeting of PIA's stockholders may be taken without a meeting,
and denies the power of the stockholders to consent in writing, without a
meeting, to the taking of any action pursuant to Delaware law).

PIA and SPAR believe that allowing PIA stockholders to act by written
consent avoids the time and expense of calling a meeting each time that the
stockholders of the Combined Company seek to act. If such amendment is approved,
PIA stockholders may not have the opportunity to approve certain corporate
actions, in person or by proxy at a meeting of stockholders. However, any action
taken by the stockholders of the Combined Company without a meeting will be
required to comply with applicable law, including, without limitation, the
General Corporate Law of the State of Delaware and, if applicable, the rules of
the Nasdaq National Market then in effect. If Charter Amendment No. 2 is
approved by the PIA stockholders, it will become effective upon filing of a
Certificate of Amendment to PIA's Certificate of Incorporation with the Delaware
Secretary of State, which is expected to be filed promptly after the Annual
Meeting.

VOTE REQUIRED

Approval of Charter Amendment No. 2 requires the affirmative vote of a
majority of the shares of PIA Common Stock outstanding as of the Record Date.
Approval of the Share/Option Issuance, each of the three Pre-Merger Charter
Amendments, the Reverse Split Proposal and the Option Plan Amendment is required
for the Merger to be consummated. If any one of the foregoing six proposals is
not approved, even if the other five proposals are approved, the Merger cannot
be consummated and none of the six proposals will be
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116

approved. The PIA Board has unanimously determined that Charter Amendment No. 2
is advisable and in the best interests of PIA and the stockholders of PIA. THE
PIA BOARD UNANIMOUSLY RECOMMENDS THAT THE PIA STOCKHOLDERS VOTE "FOR" APPROVAL
OF CHARTER AMENDMENT NO. 2.

PROPOSAL IV: CHARTER AMENDMENT NO. 3

The PIA Board has approved and adopted, subject to stockholder approval,
Charter Amendment No. 3 which provides for the amendment to PIA's Certificate of
Incorporation to change the name of PIA Merchandising Services, Inc. to "SPAR
Group, Inc." The text of Charter Amendment No. 3 is set forth in Annex B-3 to
this Proxy Statement; however, such text is subject to change as may be required
by the Delaware Secretary of State.

REASONS FOR CHARTER AMENDMENT NO. 3 AND PRINCIPAL EFFECTS

The Merger Agreement requires that the PIA stockholders approve Charter
Amendment No. 3 which provides for PIA to change its name to "SPAR Group, Inc."
PIA and SPAR believe that the Combined Companies' new name should reflect that
it is the owner of a group of companies operated under the SPAR umbrella.
Accordingly, PIA and SPAR have determined that the name of "SPAR Group, Inc."
would best accomplish that goal. If Charter Amendment No. 3 is approved by the
PIA stockholders, it will become effective upon filing of a Certificate of
Amendment to PIA's Certificate of Incorporation with the Delaware Secretary of
State, which is expected to be filed promptly after the Annual Meeting.

VOTE REQUIRED

Approval of Charter Amendment No. 3 requires the affirmative vote of a
majority of the shares of PIA Common Stock outstanding as of the Record Date.
Approval of the Share/Option Issuance, each of the three Pre-Merger Charter
Amendments, the Reverse Split Proposal and the Option Plan Amendment is required
for the Merger to be consummated. If any one of the foregoing six proposals is
not approved, even if the other five proposals are approved, the Merger cannot
be consummated and none of the six proposals will be approved. The PIA Board has
unanimously determined that Charter Amendment No. 3 is advisable and in the best
interests of PIA and the stockholders of PIA. THE PIA BOARD UNANIMOUSLY
RECOMMENDS THAT THE PIA STOCKHOLDERS VOTE "FOR" APPROVAL OF CHARTER AMENDMENT
NO. 3.

PROPOSAL V: REVERSE SPLIT PROPOSAL

The PIA Board has approved this proposal for inclusion into this Proxy
Statement which seeks stockholder authorization to effect an amendment, if
deemed necessary by the PIA Board in its sole discretion, to PIA's Certificate
of Incorporation to effect, at any time within one year following stockholder
approval, a reverse stock split (the "Reverse Split") of the PIA Common Stock,
on the basis of one of the following ratios: one share in exchange for every two
issued and outstanding shares, one share in exchange for every three issued and
outstanding shares or one share in exchange for every four issued and
outstanding shares, with the PIA Board having the discretion to determine the
appropriate ratio immediately prior to effecting the Reverse Split. The PIA
Board believes that stockholder approval of the one-for-two, one-for-three and
one-for-four exchange ratio (as opposed to approval of one specified ratio) in
which the Reverse Split may be effected will provide the PIA Board with the
maximum flexibility to achieve the purposes of the Reverse Split and is in the
best interests of PIA and its stockholders.

BOARD DISCRETION TO IMPLEMENT REVERSE SPLIT

If the Reverse Split Proposal is approved by the PIA stockholders, the
Reverse Split will be implemented, only if the PIA Board determines that the
Reverse Split (in an exchange ratio determined by the PIA Board within the
limits set forth in this proposal) is in the best interests of PIA and its
stockholders at any time within one year following stockholder approval. The
determination by the PIA Board to select one of the three exchange ratios and
abandon the others or alternatively, to reject all of the exchange ratios and
not effectuate the Reverse Split, will be based upon certain factors including
the minimum bid criteria of the Nasdaq National Market (or the Nasdaq SmallCap
Market or any other securities exchange, if applicable),

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the existing and expected marketability and liquidity of the PIA Common Stock,
prevailing market conditions and the likely effect on the market price of the
PIA Common Stock. The PIA Board may, in its sole discretion, determine not to
effect the Reverse Split. If the Reverse Split is not effected within one year
following stockholder approval, the Reverse Split will be abandoned without
further action by the Stockholders pursuant to Section 242(c) of the DGCL.

REASONS FOR THE REVERSE SPLIT

The PIA Board believes that the Reverse Split is desirable for several
reasons. The Reverse Split may be necessary for PIA to continue to be listed on
the Nasdaq National Market. Shares of the PIA Common Stock have been listed and
traded on the Nasdaq National Market since March 1996 when PIA completed its
initial public offering. On May 7, 1999, PIA received a letter from the Nasdaq
National Market expressing its belief that the Merger will require PIA to submit
a new initial listing application and to comply with the initial listing
criteria for the Nasdaq National Market. PIA responded to the Nasdaq National
Market by letter dated May 20, 1999 stating that PIA does not believe that the
consummation of the Merger should require PIA to comply with the Nasdaq National
Market's initial listing criteria. On June 21, 1999, PIA received a letter from
the Nasdaq National Market confirming its position that PIA must comply with the
Nasdaq National Market's initial listing criteria and on June 22, 1999 PIA
submitted a letter to the Nasdaq National Market requesting a hearing to appeal
this determination. If the hearings panel does not find in PIA's favor, PIA will
be required to submit an initial listing application. In general, to meet these
requirements a company must comply with one of three entry standards relating to
its financial condition, results of operations and trading market for its
securities. PIA is currently unable, and based on the recent trading history of
the PIA Common Stock may continue to be unable, to meet the minimum bid price
requirement of each applicable entry standard. PIA believes that if the Reverse
Split Proposal is approved by the PIA stockholders and a Reverse Split is
effectuated, the PIA Common Stock will likely have a minimum bid price in excess
of the $5.00 per share required for initial listing by the Nasdaq National
Market. PIA cannot assure its stockholders that it will be successful in (1)
obtaining a favorable result from the Nasdaq National Market (whether directly
or through the appeals process) or (2) satisfying the initial listing
requirements if the Nasdaq National Market determines PIA must comply with such
requirements. In addition, the rules of the Nasdaq National Market require a
company to satisfy at least one of several alternative maintenance requirements
in order to continue to be listed on the Nasdaq National Market. While PIA
believes that it currently satisfies all of the applicable maintenance criteria,
it is possible that PIA will be unable to continue to satisfy these maintenance
criteria in the future.

If the Reverse Split Proposal is not approved by the PIA stockholders, it
is possible, depending on the volatility of the PIA Common Stock and the outcome
of the appeals process, if any, that PIA will not meet the requirements for
listing on the Nasdaq National Market. The PIA Board has determined that
continued listing of the PIA Common Stock on the Nasdaq National Market would be
in the best interest of the stockholders. The delisting of the PIA Common Stock
from the Nasdaq National Market could adversely affect the liquidity of the PIA
Common Stock and the ability of PIA to raise capital. If the PIA Common Stock is
delisted from the Nasdaq National Market, management may decide to apply for
listing on the American Stock Exchange or Nasdaq SmallCap Market or another
securities exchange and the PIA Board may effect the Reverse Split in order to
enable PIA to meet any applicable minimum bid requirements. If shares of PIA
Common Stock are not approved for listing on the Nasdaq National Market, Nasdaq
SmallCap Market or any other securities exchange, the shares of PIA Common Stock
would likely be quoted in the over-the-counter market on an electronic bulletin
board established for securities or in the "pink sheets." Market interest in the
PIA Common Stock may decrease because investors would find it more difficult to
obtain accurate quotations for the price of the PIA Common Stock and the spread
between the bid and ask price of shares of PIA Common Stock is likely to be
greater. If the PIA Common Stock is delisted, it could severely limit the
ability of stockholders to trade their PIA Common Stock in the public market.

The PIA Board also believes that an increased bid price for PIA Common
Stock resulting from the Reverse Split may improve the marketability and
liquidity of the PIA Common Stock by appealing to a broader market and may
encourage interest and trading in the PIA Common Stock. Brokerage commissions on
low priced stocks generally represent a higher percentage of the stock prices
than those of higher priced stock. The current average market price therefore
results in transaction costs that represent a higher

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percentage of the total share price than if the share price were higher. In
addition, due to the volatility of low priced stocks, some brokers are reluctant
to or will not recommend that their clients purchase lower priced stocks or will
not make a market in such stocks and institutional investors may be prohibited
from purchasing such stocks as a matter of policy. These practices may adversely
affect the liquidity of the PIA Common Stock and the ability of PIA to raise
additional equity capital. The PIA Board believes that additional interest in
the PIA Common Stock by the investment community is desirable and, if it occurs
as a result of a reverse stock split, could result in a more stable trading
market for the PIA Common Stock.

EFFECTS OF THE REVERSE SPLIT ON THE PIA COMMON STOCK

The effect of a Reverse Split on the market prices for the PIA Common Stock
cannot be accurately predicted. Specifically, PIA cannot assure that prices for
shares of the PIA Common Stock following the Reverse Split will be
proportionately increased by the stock split ratio selected after the Reverse
Split occurs. In addition, PIA cannot assure that the Reverse Split will achieve
the desired results as outlined above. PIA cannot assure that the Reverse Split
will not adversely affect the market price of the PIA Common Stock, or that any
increase in the price per share that may occur immediately after the proposed
Reverse Split could be sustained for any prolonged period of time.

Proportionate voting rights and other rights of the holders of PIA Common
Stock will not be affected by the Reverse Split (other than as a result of the
payment of cash in lieu of fractional shares as described below). For example, a
holder of 2% of the voting power of the outstanding shares of PIA Common Stock
immediately prior to the effective time of the Reverse Split will continue to
hold 2% of the voting power of the outstanding shares of PIA Common Stock after
the Reverse Split. Although the Reverse Split will not affect the rights of
stockholders or any stockholder's proportionate equity interest in PIA (subject
to the treatment of fractional shares), the number of authorized shares of PIA
Common Stock will not be reduced. This will increase the ability of the PIA
Board to issue such authorized and unissued shares without further stockholder
action. For example, PIA may use authorized but unissued shares as consideration
for acquisitions as part of its business strategy. The number of stockholders of
record will not be affected by the Reverse Split (except to the extent that any
stockholder holds only a fractional share interest and receives cash for such
interest in connection with the Reverse Split).

Unless such approval is required by applicable law or regulation, PIA may
issue additional authorized but unissued shares of PIA Common Stock without the
need to obtain stockholder approval. To the extent additional shares are issued
in this manner, the percentage interest of the PIA stockholders and other
reserved shares affected by the Reverse Split could be significantly reduced.
The effective increase in the number of authorized but unissued shares of PIA
Common Stock may be construed as having an antitakeover effect by permitting the
issuance of shares to purchasers who might oppose a hostile takeover bid.

PIA also has outstanding certain stock options and warrants to purchase
shares of PIA Common Stock. Under the terms of the outstanding stock options and
warrants, the Reverse Split will effect a reduction in the number of shares of
PIA Common Stock issuable upon exercise of the stock options and warrants in
proportion to the exchange ratio of the Reverse Split and will effect a
proportionate increase in the exercise price of the stock options and warrants.

IMPLEMENTATION OF REVERSE SPLIT

If the stockholders approve the Reverse Split Proposal, a Reverse Split
will be effected only upon a determination by the PIA Board that a Reverse Split
is in the best interests of PIA and its stockholders. When making this
determination, the Board of Directors, in its discretion, will select either the
one-for-two, one-for-three or one-for-four Reverse Split ratio and the remaining
alternatives will be abandoned by the PIA Board pursuant to Section 242(c) of
the DGCL, without any further action by the stockholders of PIA. In the
alternative, the PIA Board may determine not to effect a Reverse Split and
abandon all alternatives pursuant to Section 242(c) of the DGCL, without any
further action by the PIA stockholders.

AMENDMENT EFFECTIVE DATE

The Reverse Split would become effective at the time of the filing of a
certificate of amendment to the PIA Certificate of Incorporation with the
Secretary of State of the State of Delaware or at such later time as
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may be specified therein (the "Amendment Effective Time"). At the Amendment
Effective Time, each share of PIA Common Stock issued and outstanding
immediately prior to the Amendment Effective Time (the "Old PIA Common Stock")
will be automatically and without any further action on the part of the
stockholders, reclassified into either  1/2, 1/3 or 1/4 of a share of PIA Common
Stock (the "New PIA Common Stock"). For example, if a person held 120 shares of
Old PIA Common Stock prior to the Amendment Effective Time, at the Amendment
Effective Time such person would hold 60 shares of New PIA Common Stock if a
one-for-two ratio were selected, 40 shares of New PIA Common Stock if a
one-for-three ratio were selected and 30 shares of New PIA Common Stock if a
one-for-four ratio were selected.

PAYMENT FOR FRACTIONAL SHARES

No fractional shares of New PIA Common Stock will be issued as a result of
the Reverse Split. In lieu of any fractional shares, each holder of Old PIA
Common Stock who would otherwise receive a fractional share of New PIA Common
Stock will be entitled to receive cash in an amount equal to the product
obtained by multiplying (1) the closing sales price of the PIA Common Stock on
the date of the Amendment Effective Time as reported on the Nasdaq National
Market (or, if applicable, the Nasdaq SmallCap Market or any exchange that the
PIA Common Stock may be traded on at the time of the Reverse Split) by (2) the
number of shares of Old PIA Common Stock held by such holder that would
otherwise have been exchanged for such fractional share interest.

EXCHANGE OF STOCK CERTIFICATES

As soon as practicable after the Amendment Effective Time, each holder of
record of Old PIA Common Stock will receive instructions for the surrender of
certificate(s) representing the Old Shares to an exchange agent designated by
PIA. The instructions will include a form of transmittal letter to be completed
and returned to the exchange agent. Upon proper completion and execution of the
letter of transmittal and return thereof to the exchange agent, together with
the certificate(s) representing the Old PIA Common Stock into which the
surrendered shares have been reclassified along with payment of any amount to be
paid in cash in lieu of any fractional shares, a stockholder will be entitled to
receive a certificate representing the number of full shares of the New PIA
Common Stock. Until surrendered as contemplated herein, each certificate
representing Old PIA Common Stock shall be deemed at and after the Reverse Split
to represent the corresponding number of full shares of New PIA Common Stock
contemplated by the preceding sentence as well as the right to receive cash in
lieu of fractional shares.

FEDERAL INCOME TAX CONSEQUENCES OF THE REVERSE SPLIT

A summary of the federal income tax consequences of the proposed Reverse
Split to PIA and to individual stockholders is set forth below. The following
discussion is based upon present federal income tax law. The discussion is not
intended to be, nor should it be relied on as, a comprehensive analysis of the
tax issues arising from or relating to the proposed Reverse Split. In addition,
PIA has not and will not seek an opinion of counsel or a ruling from the
Internal Revenue Service regarding the federal income tax consequences of the
proposed Reverse Split. ACCORDINGLY, STOCKHOLDERS ARE ADVISED TO CONSULT THEIR
OWN TAX ADVISORS FOR MORE DETAILED INFORMATION REGARDING THE EFFECTS OF THE
PROPOSED REVERSE SPLIT ON THEM UNDER APPLICABLE FEDERAL, STATE, LOCAL AND
FOREIGN INCOME TAX LAWS.

1. Except with respect to any cash received for fractional shares, the
Reverse Split will be a tax-free recapitalization for PIA and its
stockholders.

2. The shares of New PIA Common Stock in the hands of a stockholder
will have an aggregate basis for computing gain or loss equal to the
aggregate basis of shares of Old PIA Common Stock held by that stockholder
immediately prior to the Reverse Split, reduced by the basis allocable to
any fractional shares which such stockholder is treated as having sold for
cash (see paragraph 4 below).

3. A stockholder's holding period for the New PIA Common Stock will be
the same as the holding period of the Old PIA Common Stock exchanged
therefor.

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4. Stockholders who receive cash for all of their holdings (as a
result of owning fewer than two, three or four shares, depending on the
chosen ratio) will recognize a gain or loss for federal income tax purposes
as a result of the disposition of their shares of Old PIA Common Stock.
Although the tax consequences to other stockholders who receive cash for
fractional shares are not entirely certain, such stockholders will probably
be treated for federal income tax purposes as having sold their fractional
shares and will recognize gain or loss in an amount equal to the difference
between the cash received and the portion of their basis for the Old PIA
Common Stock allocated to the fractional shares. Stockholders who do not
receive any cash for their holdings will not recognize any gain or loss for
federal income tax purposes as a result of the Reverse Split.

MISCELLANEOUS

The PIA Common Stock is currently registered under the Exchange Act and, as
a result, PIA is subject to the periodic reporting and other requirements of the
Exchange Act. The Reverse Split will not affect the registration of the PIA
Common Stock under the Exchange Act. The par value of the PIA Common Stock will
not change as a result of the Reverse Split. Accordingly, the PIA Common Stock
account on PIA's Consolidated Balance Sheet will be reduced with the Additional
Paid-in Capital account being credited with the amount by which the PIA Common
Stock account was reduced.

VOTE REQUIRED

Approval of the Reverse Split Proposal requires the affirmative vote of a
majority of the shares of PIA Common Stock outstanding as of the Record Date.
Approval of the Share/Option Issuance, each of the three Pre-Merger Charter
Amendments, the Reverse Split Proposal and the Option Plan Amendment is required
for the Merger to be consummated. If any one of the foregoing six proposals is
not approved, even if the other five proposals are approved, the Merger cannot
be consummated and none of the six proposals will be approved. The PIA Board has
unanimously determined that the Reverse Split Proposal is advisable and in the
best interests of PIA and the stockholders of PIA. The PIA Board unanimously
recommends that the PIA stockholders vote "FOR" approval of the Reverse Split
Proposal.

IN ACCORDANCE WITH DGCL, NOTWITHSTANDING STOCKHOLDER APPROVAL OF THE
REVERSE SPLIT PROPOSAL, AT ANY TIME PRIOR TO THE EFFECTIVENESS OF THE REVERSE
SPLIT, THE PIA BOARD MAY ABANDON THE REVERSE SPLIT PROPOSAL WITHOUT FURTHER
ACTION BY THE STOCKHOLDERS.

PROPOSAL VI: OPTION PLAN AMENDMENT

At the Annual Meeting, PIA stockholders will be asked to consider and vote
upon a proposal to amend PIA's Amended and Restated 1995 Stock Option Plan to
increase the number of shares of PIA Common Stock reserved for issuance upon
exercise of stock options granted thereunder from 1,300,000 to 3,500,000. In
February 1999, the PIA Board adopted such amendment, subject to stockholder
approval. Such approval will require the affirmative vote of a majority of the
voting power of all outstanding shares of PIA Common Stock present or
represented and entitled to vote at the Annual Meeting.

As of the Record Date, there were options outstanding to purchase 912,757
shares of PIA Common Stock and 385,243 shares remained available for future
grants under the 1995 Option Plan (without giving effect to the Option Plan
Amendment). The PIA Board approved the Option Plan Amendment primarily to ensure
that following the Merger, the Combined Company has an option pool sufficient to
attract and retain qualified personnel. In addition, pursuant to the terms of
the Merger Agreement, the PIA Board will grant options covering up to a maximum
of 2,133,744 shares of PIA Common Stock to SPAR employees and other persons
providing valuable services to SPAR effective as of the Closing Date with Mr.
Brown, Mr. Bartels and Mr. Oakley currently anticipated to receive options to
purchase 795,917, 506,493 and 300,000 shares of PIA Common Stock, respectively,
as of the Closing Date; provided that the number of options to be granted to
Messrs. Brown and Bartels may be reduced at any time prior to the consummation
of the Merger. The date of grant of such stock options shall be the Closing
Date, and the exercise price of such stock options shall be the last sale price
as reported on the Nasdaq National Market on the Closing Date. The vesting
provisions and other terms of such options shall be determined pursuant to the
terms of the Merger Agreement. The 2,133,744 shares represent approximately 97%
of the additional 2.2 million shares which will be reserved for

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issuance under the 1995 Option Plan if the Option Plan Amendment is approved by
the PIA stockholders. The 1995 Option Plan, as amended by the Option Plan
Amendment, and information regarding options granted thereunder is summarized
below, but these descriptions are subject to and are qualified in their entirety
by the full text of the 1995 Option Plan, as amended by the Option Plan
Amendment, which is attached as Annex C to this Proxy Statement.

SUMMARY OF THE 1995 OPTION PLAN

The 1995 Option Plan was initially adopted by the PIA Board and
stockholders of PIA in December 1995, and was amended and restated by the PIA
Board in February 1999. Under the 1995 Option Plan, employees, certain
directors, officers and consultants (collectively referred to as the
"Participants") providing services to PIA or its subsidiaries may be granted
certain options ("Options") to purchase shares of PIA Common Stock. The 1995
Option Plan permits the granting of both Options that qualify for treatment as
incentive stock options ("Incentive Stock Options") under Section 422 of the
Code, and Options that do not qualify as Incentive Stock Options ("Nonqualified
Stock Options"). Incentive Stock Options may only be granted to employees of PIA
or its subsidiaries.

The purpose of the 1995 Option Plan and of granting Options to specified
persons is to promote the interests of PIA and its stockholders, by providing
stock-based incentives to certain Participants. Under the 1995 Option Plan, the
mutuality of interest between the Participants and PIA is strengthened because
the Participants have a proprietary interest in pursuing PIA's long-term growth
and financial success. In addition, by allowing the Participants to participate
in PIA's success, PIA is better able to attract, retain and reward quality
employees, directors, officers and consultants. In selecting the Participants to
whom Options may be granted, consideration is given to factors such as
employment position, duties and responsibilities, ability, productivity, length
of service, morale, interest in PIA and recommendations of supervisors. The
maximum number of shares that may be issued to a single Participant is
1,000,000.

The 1995 Option Plan is administered by the PIA Board or by the
Compensation Committee established by the PIA Board. (The entity actually
administering the 1995 Option Plan is referred to herein as the "Committee.")
The Committee is, when possible, composed of two or more Non-Employee Directors,
as defined in Rule 16b-3(b)(3) of the Exchange Act of 1934, as amended (the
"Exchange Act") and of persons who are "outside directors" under Section 162(m)
of the Code.

The Committee has full and complete authority, subject to the express
provisions of the 1995 Option Plan: (1) to select the Participants, to specify
the number of shares of PIA Common Stock with respect to which Options are
granted to each Participant, to specify the terms of the Options and whether
such Options shall be Incentive Stock Options or Nonqualified Stock Options, and
in general to grant Options; (2) to determine the dates upon which Options shall
be granted and the terms and conditions thereof in a manner consistent with the
1995 Option Plan, which terms and conditions need not be identical as to the
various Options granted; (3) to interpret the 1995 Option Plan; (4) to
prescribe, amend and rescind rules relating to the 1995 Option Plan; (5) to
authorize any person to execute on behalf of PIA any instrument required to
effectuate the grant of an Option previously granted by the Committee; (6) to
determine the rights and obligations of Participants under the 1995 Option Plan;
(7) to specify the Option price; (8) to accelerate the time during which an
Option may be exercised, including, but not limited to, upon a change of control
of PIA, and to otherwise accelerate the time or extend the post-termination
exercise period during which an Option may be exercised; and (9) to make all
other determinations deemed necessary or advisable for the administration of the
1995 Option Plan.

If this proposal is approved, the number of shares of PIA Common Stock in
respect of the options which may be granted under the 1995 Option Plan will
increase from 1,300,000 shares to 3,500,000 shares, subject to certain
adjustments which may be made by the Committee upon the occurrence of certain
changes in PIA's capitalization or structure.

Each option granted under the Option Plan will be evidenced by a written
agreement ("Option Agreement") in a form approved by the Committee and executed
by PIA and the Participant to whom the Option is granted. Options will be
exercisable at such time(s) and subject to such terms and conditions as may be
set forth in the Option Agreement.

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The purchase price of shares of PIA Common Stock subject to each Option
which is intended to qualify as an Incentive Stock Option will be equal to the
fair market value of such shares (110% of fair market value in the case of a
holder of more than 10% of PIA Common Stock) on the date of grant of such
Option. The purchase price of any Option which does not qualify as an Incentive
Stock Option shall be determined by the Committee, but shall not be less than
the fair market value of the PIA Common Stock in the case of an Option granted
to an individual who is a "covered employee" under Section 162(m) of the Code in
order to preserve the deductibility of the compensation that will be recognized
upon the exercise of the Option. The fair market value of such shares is the
closing price of the PIA Common Stock on the Nasdaq National Market on the date
of grant.

Options granted under the 1995 Option Plan may be exercised, to the extent
vested, by the Participant by payment of the full purchase price therefor in
cash, by cashier's or certified check or by surrender of outstanding shares of
PIA Common Stock. Options granted to a Participant are not transferable during
the individual's lifetime, other than to the employee's immediate family
members, a trust for their benefit or a partnership in which such family members
are the only partners, and may be transferred in the event of death only by will
or the laws of descent and distribution.

Each option granted under the 1995 Option Plan shall set forth a
termination date thereof, which shall not be later than ten years (five years in
the case of a holder of more than 10% of PIA Common Stock) from the date such
option is granted subject to earlier termination or forfeiture as set forth
below, or as otherwise set forth in each particular Option Agreement.

Unless earlier terminated by the Board, the 1995 Option Plan will terminate
on December 4, 2005. The PIA Board may make such further amendments to the 1995
Option Plan as it shall deem advisable.

Future Participants in the 1995 Option Plan and the amounts of their
allotments are to be determined by the Committee subject to any restrictions
outlined above or in the text of the 1995 Option Plan or the applicable Option
Agreement. Because no such determinations have yet been made, it is not possible
to state the terms of any individual awards which may be issued under the 1995
Option Plan or the names or positions of or respective amounts of the allotment
to any individual who may participate.

FEDERAL INCOME TAX CONSEQUENCES APPLICABLE TO THE 1995 OPTION PLAN

Incentive Stock Options. No taxable income will be recognized by a
Participant upon the grant or exercise of any Incentive Stock Option under the
1995 Option Plan. The Combined Company will not be entitled to any income tax
deduction as the result of the grant or exercise of any incentive stock option.

Any gain or loss resulting from the subsequent sale of stock acquired upon
exercise of an Incentive Stock Option will be long-term capital gain or loss if
such sale is made after the later of (a) two years from the date of the grant of
the option or (b) one year from the transfer of such stock to the Participant
upon exercise, provided that the Participant is an employee of PIA from the date
of grant until three months before the date of exercise. This three-month period
is extended in the event of the Participant's death or disability prior to
exercise of an Incentive Stock Option.

If the subsequent sale of stock is made prior to the expiration of such
two-year or one-year periods, the Participant will recognize ordinary income in
the year of sale in an amount equal to the difference between the exercise price
and the fair market value of the stock on the date of exercise. Furthermore, if
such sale is a transaction in which a loss (if sustained) would have been
recognized by the Participant, the amount of ordinary income recognized by the
Participant will not exceed the excess (if any) of the amount realized on the
sale over the option price. PIA will then be entitled to an income tax deduction
of the amount of ordinary income that the Participant recognizes. Any excess
gain recognized by the Participant upon such sale would then be taxable as
capital gain, either long-term or short-term depending upon whether the stock
had been held for more than one year prior to sale.

If the sale of shares of PIA Common Stock received upon exercise of an
option qualifies for long-term capital gain treatment, the capital gain from
such sale would be taxed at the current maximum federal tax rate of generally
20% if the PIA Common Stock has been held for more than one year. Ordinary
income is currently taxed at the Participant's current maximum federal income
tax marginal rate of, which can be as much as 39.6%. The amount by which the
fair market value of stock purchased upon exercise of an Incentive
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Stock Option exceeds the option price of such stock generally constitutes an
item of tax preference which could be subject to the alternative minimum tax in
the year that the option is exercised.

Nonqualified Stock Options. Generally, at the time of the grant of any
option under the 1995 Option Plan, no taxable income will be recognized by the
Participant and PIA will not be entitled to a deduction. Upon the exercise of
such option, the Participant generally will recognize ordinary income, and PIA
will then be entitled to a deduction, in the amount by which the then fair
market value of the shares of PIA Common Stock issued to such Participant
exceeds the option price.

Income recognized by the Participant upon exercise of a Nonqualified Stock
Option will be taxed as ordinary income up to the Participant's current maximum
marginal rate, which can be as much as 39.6%. Such income constitutes "wages"
with respect to which PIA is required to deduct and withhold federal and state
income tax. Such deductions will be made from the wages, salary, bonus or other
income to which the Participant would otherwise be entitled and, at PIA's
election, the Participant may be required to pay to PIA (for withholding on the
Participant's behalf) any amount not so deducted but required to be so withheld.
PIA may permit the Participant to elect to surrender, or authorize PIA to
withhold, shares of PIA Common Stock (valued at their fair market value on the
date of surrender or withholding of such shares) in satisfaction of PIA's
withholding obligation.

Upon the subsequent disposition of shares acquired upon the exercise of the
Option, the Participant will recognize capital gain or loss in an amount equal
to the difference between the proceeds received upon disposition and the fair
market value of such shares at the time of exercise. If such shares have been
held for more than one year at the time of such disposition, the capital gain or
loss will be long-term.

Exercising Options with Shares of PIA Common Stock. To the extent a
Participant pays all or part of the option price by tendering shares of PIA
Common Stock owned by the Participant, the tax consequences described above
generally would apply. However, the number of shares received (upon exercise)
equal to the number of shares surrendered in payment of the aggregate option
price will have the same basis and tax holding period as the shares surrendered.
The additional shares received upon such exercise will have a tax basis equal to
the amount of ordinary income recognized and any cash paid on such exercise and
a holding period which commences on the date of exercise.

If a Participant exercises an option by tendering shares previously
acquired on the exercise of an Incentive Stock Option, a disqualifying
disposition will occur if the applicable holding period requirements have not
been satisfied with respect to the surrendered stock. The consequences of such a
disqualifying disposition is that the Participant may recognize ordinary income
at the time.

Acceleration of Stock Options upon a Transfer of Control. If, upon a
reorganization, merger, sale or other transaction resulting in a change in
control of PIA or of a substantial portion of its assets, the exercisability of
stock options held by certain employees (generally officers, stockholders and
highly compensated employees of PIA) is accelerated (or payments are made to
cancel unexercisable options of such employees), such acceleration or payment
will be determined to be a "parachute payment" for federal income tax purposes.
If the present value of all of the Participant's parachute payments exceeds
three times the Participant's average compensation for the past five years, the
Participant will be subject to a 20% excise tax on the amount of such parachute
payment which is in excess of the greater of such average compensation of the
Participant ("excess parachute payment"). In addition, PIA will not be allowed
to deduct such excess parachute payment.

Limitation on Compensation Deduction. Upon exercise, options granted to a
"covered employee" should not be subject to the $1 million deduction cap for
compensation paid to certain executives of publicly held corporations such as
PIA, if the following conditions are satisfied: (1) each option granted to a
covered employee (a) has an option price equal to or greater than the fair
market value of the PIA Common Stock on the date of the grant, and (b) was made
by a committee consisting solely of two or more "Outside Directors" of PIA, and
(2) the stockholders have approved the 1995 Option Plan.

Upon exercise, options granted to a covered employee with an option price
less than the fair market value of the PIA Common Stock at the time of grant
would be subject to the $1 million deduction cap for PIA. A "covered employee"
is a Participant who, on the last day of the taxable year of PIA, is the Chief
Executive Officer or one of the four other most highly compensated executive
officers for proxy disclosure purposes. An
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"Outside Director" is a Director who is not (1) a current employee of PIA or
related entity, (2) a former employee who is receiving compensation for prior
services, (3) a former officer or (4) receiving compensation from PIA for
personal services other than regular directors' compensation.

The foregoing summary of the effects of federal income taxation upon the
Participants, and the Combined Company with respect to shares issued under the
1995 Option Plan does not purport to be complete and reference is made to the
applicable provisions of the Code.

VOTE REQUIRED

Approval of the Option Plan Amendment which increases the number of shares
of PIA Common Stock reserved for issuance under the 1995 Option Plan from
1,300,000 to 3,500,000 requires the affirmative vote of a majority of the voting
power of all outstanding shares of PIA Common Stock present or represented and
entitled to vote at the Annual Meeting. Approval of the Share/Option Issuance,
each of the Pre-Merger Charter Amendments, the Reverse Split Proposal and the
Option Plan Amendment is required for the Merger to be consummated. If any one
of the foregoing six proposals is not approved, even if the other five proposals
are approved, the Merger cannot be consummated and none of the six proposals
will be approved. The PIA Board has unanimously determined that the Option Plan
Amendment is advisable and in the best interests of PIA and the stockholders of
PIA. THE PIA BOARD UNANIMOUSLY RECOMMENDS THAT THE PIA STOCKHOLDERS VOTE "FOR"
APPROVAL OF THE OPTION PLAN AMENDMENT.

PROPOSAL VII: ELECTION OF DIRECTORS

Seven directors are to be elected at the Annual Meeting to serve until the
consummation of the Merger, or if the Merger is not consummated, until the next
Annual Meeting of Stockholders or until their respective successors have been
elected and qualified. In the absence of instructions to the contrary, proxies
covering shares of PIA Common Stock will be voted in favor of the election of
the persons listed below. In the event that any nominee for election as director
should become unavailable to serve, it is intended that votes will be cast,
pursuant to the enclosed proxy, for such substitute nominee as may be nominated
by PIA. PIA management has no present knowledge that any of the persons named
will be unavailable to serve.

None of the nominees has any family relationship to any other nominee or to
any executive officer of PIA. No arrangement or understanding exists between any
nominee and any other person or persons pursuant to which any nominee was or is
to be selected as a director or nominee other than with respect to Mr. Owens who
has a contractual right to be nominated as a director as long as he holds at
least 250,000 shares of PIA Common Stock. Mr. Owens has indicated that he will
waive his contractual right to be nominated to the PIA Board in connection with
the Merger. See "Executives Officers' Compensation and Other Information of
PIA -- Employment Agreement, Severance Arrangements and Change in Control
Arrangements." In connection with the consummation of the Merger, each of the
nominees other than Messrs. Collins and Lewis has agreed to resign from the PIA
Board and Messrs. Collins and Lewis will fill three of the five remaining
vacancies with Messrs. Brown, Bartels and Aders. See "Proposal I -- Share/Option
Issuance -- Board of Directors and Management After the Merger."

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INFORMATION CONCERNING NOMINEES TO PIA BOARD

Set forth in the table below are the names and ages of the nominees for
election as directors. Ages are shown as of May 1, 1999. Each nominee has
consented to being named in this Proxy Statement as a nominee for director and
has agreed to serve as a director if elected.

NAME                 AGE                    POSITION WITH PIA
----                 ---                    -----------------

Terry R. Peets....................  55     Chief Executive Officer, President and Director
Patrick W. Collins(1).............  70     Director
John A. Colwell...................  48     Director
Joseph H. Coulombe(2).............  68     Director
Patrick C. Haden(1)(2)............  46     Director
J. Christopher Lewis..............  43     Director
Clinton E. Owens..................  57     Chairman of the Board and Director

---------------
(1) Member of the Compensation Committee.

(2) Member of the Audit Committee.

Set forth below is a brief description of the business experience for the
previous five years of all nominees for directors of PIA.

Mr. Peets joined PIA in August 1997 as Chief Executive Officer, President
and Director. Mr. Peets served as Executive Vice President of The Vons
Companies, Inc. from 1995 to April 1997. Prior to joining Vons, Mr. Peets served
in various sales, marketing and operation roles as Senior Vice President for
Ralphs Grocery Company from 1977 to 1994, until he was named Executive Vice
President in 1994. Mr. Peets also serves as a director of Supermarkets Online, a
division of Catalina Marketing Corporation, a provider of in-store electronic
marketing services and Diamond Brands, Inc., a manufacturer and marketer of
branded household products.

Mr. Collins has been a member of the PIA Board since May 1998. Mr. Collins
served as Chief Operating Officer of Ralphs Grocery Company for 18 years, 17 of
which he served as President and one year as Vice Chairman. Mr. Collins also
serves as a director of Catalina Marketing Corporation, a provider of in-store
electronic marketing services, and New Bristol Farms, Inc., a gourmet food
grocery chain.

Mr. Colwell has been a member of the PIA Board since March 1991, and
currently serves as a consultant to PIA. From February 1997 through August 1997,
Mr. Colwell served as interim Vice Chairman of the Board. Mr. Colwell is sole
proprietor of a consulting and interim management firm bearing his name, and
President of Facility Development Corporation. Since 1991, Mr. Colwell has
served as a Managing Director of Lineberger & Co., a private equity investment
firm. From November 1991 through February 1997, Mr. Colwell was Senior Vice
President of River City Plastics, Inc., a manufacturer of polyvinyl chloride
pipe.

Mr. Coulombe has been a member of the PIA Board since May 1993. Mr.
Coulombe is the founder and former Chief Executive Officer of Trader Joe's, a
specialty food grocery chain. Mr. Coulombe sold Trader Joe's in 1979 and
remained the Chief Executive Officer of Trader Joe's until January 1989. From
February 1995 to April 1995, Mr. Coulombe served as President and Chief
Executive Officer of Sport Chalet, and served as a director of Sport Chalet from
February 1993 to June 1994. From February 1994 to January 1995, Mr. Coulombe
served as Chief Executive Officer of Provigo Corp., the Northern California
subsidiary of Provigo Inc., of Montreal. From June 1992 to January 1994, Mr.
Coulombe served as a member of the Board of Directors of Imperial Bank, a
subsidiary of Imperial Bancorp. Mr. Coulombe also serves as a director of Cost
Plus World Market, a home furnishings store chain, and New Bristol Farms, Inc.,
a gourmet food grocery chain.

Mr. Haden became a member of the PIA Board in August 1988 in connection
with PIA's acquisition. Since 1987, Mr. Haden has been a general partner of
Riordan, Lewis & Haden (RLH), equity investors in California-based enterprises.
RLH's portfolio interests emphasize high growth middle market companies,
especially those in the value added service sector. Mr. Haden also serves as a
director of Tetra Tech, Inc., an environmental engineering and consulting firm,
Data Processing Resources Corporation, a provider of information technology
specialty staffing services, and several privately-held companies.

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Mr. Lewis has been a member of the PIA Board since April 1997. Since 1981,
Mr. Lewis has been a general partner of Riordan, Lewis & Haden. Mr. Lewis also
serves as a director of Tetra Tech, Inc., Data Processing Resources Corporation,
SM&A Corporation, California Beach Restaurants, Inc., an owner and operator of
restaurants, and several privately-held companies.

Mr. Owens has been Chairman of PIA since August 1988 and served as Chief
Executive Officer of PIA from August 1988 to August 1997. Mr. Owens has over 30
years experience in the merchandising services and packaged goods industries.
Mr. Owens previously has served as Senior Vice President of Sales and Marketing
of Coca Cola Foods, and has also served in various management positions with RJR
Foods and Procter & Gamble, among others.

DIRECTOR COMPENSATION

During the year ended January 1, 1999, PIA paid to Messrs. Coulombe and
Edwin Epstein, a former director, an aggregate of $10,500 and $15,750,
respectively, for services as members of the PIA Board and as consultants, and
also reimbursed Messrs. Coulombe and Epstein for certain expenses in connection
with their attendance at PIA Board and committee meetings. Messrs. Haden and
Lewis received no compensation for their services as directors (other than the
grant of options as described in the following paragraphs). Commencing April 1,
1998, Mr. Colwell receives an annual salary of $50,000 for consulting services.
Mr. Colwell is also entitled to receive a success fee in the event certain
transactions (approximately $150,000 in connection with the Merger) are
completed by PIA. Prior to April 1, 1998, Mr. Colwell received a monthly salary
of $16,667 for his services as a director. During fiscal 1998, PIA paid Mr.
Colwell an aggregate of $120,790 for his services as a member of the PIA Board
and consultant, and also reimbursed Mr. Colwell for certain expenses in
connection with his attendance at PIA Board meetings. In addition, beginning in
April 1998, Messrs. Collins and Coulombe receive a $3,000 fee for regular
meetings (up to a maximum of four meetings) and a $500 fee for special meetings
(including telephonic meetings). Mr. Collins deferred receipt of his
compensation until January 1999.

Under the 1995 Option Plan, on April 8, 1998, PIA granted Messrs. Collins
and Coulombe an option to purchase 10,000 shares and 4,000 shares, respectively,
of PIA Common Stock at an exercise price of $4.875 per share. Such options vest
over four years at an annual rate of 25% beginning on the first anniversary of
the date of grant, provided that such option will automatically vest in full
upon the consummation of the Merger or another acquisition event as described in
the following paragraph.

1995 Stock Option Plan for Nonemployee Directors. PIA adopted its 1995
Stock Option Plan for Nonemployee Directors in December 1995 (the "Nonemployee
Directors Plan"), covering 100,000 shares of PIA Common Stock. Under the
Nonemployee Directors Plan, each of Messrs. Coulombe, Haden and Lewis was
granted an option to purchase 1,500 shares of PIA Common Stock at an exercise
price of $5.32 per share that became fully exercisable on May 12, 1998. Messrs.
Colwell, Coulombe, Haden and Lewis were each granted an option to purchase 1,500
shares of PIA Common Stock at an exercise price of $5.125 per share on May 12,
1998, that will become fully exercisable on the date of the Annual Meeting if
they serve as a director until the date of the Annual Meeting. Notwithstanding
the foregoing, pursuant to action taken by the PIA Board in February 1999, all
options granted to nonemployee directors will automatically vest in full upon
the occurrence of an acquisition event (such term, as defined by the PIA Board,
includes the consummation of the Merger).

PIA's Compensation Committee administers the Nonemployee Directors Plan.
Each member of the PIA Board who is not otherwise an employee or officer of PIA
or any subsidiary of PIA (each, an "Eligible Director") is eligible to
participate in the Nonemployee Directors Plan. Directors who are consultants of,
but not otherwise employees or officers of, PIA are Eligible Directors.

Under the Nonemployee Directors Plan, an option to purchase 1,500 shares of
PIA Common Stock is granted to each Eligible Director immediately following each
annual meeting of stockholders of PIA. Each option vests and becomes exercisable
in full at the next annual meeting of stockholders, provided that the optionee
is reelected as a director of PIA. The maximum term of options granted under the
Nonemployee Directors Plan is ten years and one day, subject to earlier
termination following an optionee's cessation of service with PIA. The exercise
price of stock options granted under the Nonemployee Directors Plan will be the
fair market value of the PIA Common Stock on the date of grant.
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MEETINGS AND COMMITTEES

During fiscal 1998, the Board held nine meetings and took various actions
by written consent. Each incumbent director attended at least 75% of the
aggregate of (i) the total number of meetings held by the Board during fiscal
1998 and (ii) the total number of meetings held by all committees of the Board
during that period within which he was a Director or member of such committee of
the Board.

The standing committees of the PIA Board are the Audit Committee (the
"Audit Committee") and the Compensation Committee (the "Compensation
Committee"). The Audit Committee held two meetings and the Compensation
Committee held one meeting during fiscal 1998. PIA does not have a standing
nominating committee or any committee performing the functions thereof.

The Audit Committee presently consists of Messrs. Haden and Coulombe. The
Audit Committee makes recommendations concerning the engagement of independent
public accountants; reviews with the independent public accountants the plans
for and scope of the audit; reviews the results of the audit; approves the
professional services provided by the independent public accountants; reviews
the independence of the public accountants; and reviews the adequacy and
effectiveness of PIA's internal accounting control.

The Compensation Committee presently consists of Messrs. Haden and Collins.
The Compensation Committee determines compensation for PIA's executive officers
and administers PIA's stock incentive plans.

VOTE REQUIRED

The director nominees who receive the greatest number of votes at the
Annual Meeting will be elected to the PIA Board. THE PIA BOARD UNANIMOUSLY
RECOMMENDS A VOTE "FOR" THE ELECTION OF EACH OF THE NOMINEES SET FORTH ABOVE.

EXECUTIVE OFFICERS' COMPENSATION AND OTHER INFORMATION OF PIA

EXECUTIVE OFFICERS

Set forth in the table below are the names, ages and positions of the
current directors and executive officers of PIA. Ages are shown as of May 1,
1999. Executive officers are elected by and serve at the discretion of the PIA
Board. None of the executive officers has any family relationship to any nominee
for director or to any other executive officer of PIA.

NAME                 AGE                    POSITION WITH PIA
----                 ---                    -----------------

Clinton E. Owens..................  57     Chairman of the Board and Director
Terry R. Peets....................  55     Chief Executive Officer, President and Director
Cathy L. Wood.....................  51     Executive Vice President, Chief Financial Officer
and Secretary
Donald H. Holman..................  42     Executive Vice President -- Marketing and Sales
John R. Bain......................  52     Executive Vice President -- Operations
Mark J. Hallsman..................  44     Senior Vice President -- Field Logistics and
Operations Planning

Set forth below is a brief description of the business experience for the
previous five years of all current executive officers of PIA except Messrs.
Peets and Owens whose business experience has been previously described. See
"Proposal VII -- Election of Directors -- Information Concerning Nominees to PIA
Board." In connection with the consummation of the Merger, each of the above
executive officers has agreed to resign other than Ms. Wood who will remain in
her current position and Mr. Peets who will become Vice Chairman of the Combined
Company. Upon the consummation of the Merger, the executive officers of PIA will
be as set forth under "Proposal I -- Share/Option Issuance -- Board of Directors
and Management After the Merger."

Ms. Wood joined PIA in August 1997 as Executive Vice President, Chief
Financial Officer and Secretary. Ms. Wood served as Vice President and Chief
Financial Officer of Giant Group Ltd., a NYSE listed company specializing in
acquisitions, from 1995 to 1997. From 1989 to 1995, Ms. Wood served in

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various capacities at Wherehouse Entertainment, Inc. prior to being named Senior
Vice President and Chief Financial Officer in 1993.

From 1972 to 1989, Ms. Wood served in various credit and lending positions
at Mellon Bank, N.A., including from 1982 to 1989, Vice President of Consumer
Products and Retail Credit Analysis.

Mr. Holman joined PIA in June 1992 and has served as Executive Vice
President of Marketing and Sales since August 1998. From June 1996 to August
1998, Mr. Holman served as PIA's Vice President of Sales. From January 1995 to
June 1996, Mr. Holman served as PIA's Vice President of Business Development and
from June 1992 to December 1994, Mr. Holman served as PIA's Vice President
Division Manager.

Mr. Bain joined PIA in November 1997 as Senior Vice President of Operations
and became Executive Vice President of Operations in August 1998. Mr. Bain
served as Executive Vice President of Shasta Beverages in the Western Division
from October 1995 to November 1997. Before joining Shasta Beverages, Mr. Bain
served as Vice President of Sales and Marketing for Casablanca Food Company, and
Divisional Vice President for Continental Baking Company, from 1992 to 1994.

Mr. Hallsman joined PIA in August 1993 and has served as Senior Vice
President of Field Logistics and Operations Planning since August 1998. From
December 1995 to August 1998, Mr. Hallsman served as PIA's Senior Vice President
of Human Resources and from August 1993 to December 1995, Mr. Hallsman served as
Vice President of Human Resources. From September 1985 to August 1993, Mr.
Hallsman served as Director, Human Resources of Con-Way Western Express, a
provider of short-haul trucking services.

EXECUTIVE COMPENSATION

The following table sets forth all compensation received for services
rendered to PIA in all capacities for the three fiscal years ended January 1,
1999 by (i) PIA's Chief Executive Officer during fiscal 1998, and (ii) each of
the other four most highly compensated executive officers of PIA who were
serving as executive officers at the end of fiscal 1998 (collectively, the
"Named Executive Officers"):

SUMMARY COMPENSATION TABLE

LONG TERM
COMPENSATION
AWARDS
------------
ANNUAL COMPENSATION      SECURITIES     ALL OTHER
FISCAL   -----------------------    UNDERLYING    COMPENSATION
NAME AND PRINCIPAL POSITIONS          YEAR    SALARY($)(1)   BONUS($)    OPTIONS(#)       ($)(2)
----------------------------         ------   ------------   --------   ------------   ------------

Terry R. Peets............................   1998      $253,894     $    --       35,000         $7,667
President and Chief Executive Officer      1997       111,757          --      250,000         10,675
1996            --          --           --             --
Clinton E. Owens..........................   1998       340,833          --           --         13,442
Chairman of the Board                      1997       400,000          --           --         34,557
1996       400,000      50,000           --         36,820
Cathy L. Wood.............................   1998       202,366          --       65,000             --
Executive Vice President, Chief
Financial                               1997        96,692          --      100,000             --
Officer and Secretary                      1996            --          --           --             --
John R. Bain..............................   1998       160,625          --       45,000          2,463
Executive Vice President -- Operations     1997        18,750          --       25,000             --
1996            --          --           --             --
Donald H. Holman..........................   1998       168,317          --       52,500          2,966
Executive Vice President -- Marketing
and                                     1997       120,118          --       15,000          2,434
Sales                                   1996       107,056       9,000       10,000          2,174

---------------
(1) For the year ended December 31, 1996, includes $109,500 and $4,347 deferred
at the election of Messrs. Owens and Holman, respectively; for the year
ended December 31, 1997, includes $2,500, $95,833 and $4,867, deferred at
the election of Messrs. Peets, Owens and Holman, respectively; and for the
year ended January 1, 1999, includes $10,000, $8,802, $9,850 and $5,933,
deferred at the election of Messrs. Peets, Owens, Bain and Holman,
respectively; pursuant to PIA's 401(k) Plan and Deferred

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Compensation Arrangement. See "-- Compensation Plans -- 401(k) Plan" and
"-- Deferred Compensation Arrangement."

(2) Consists of contributions to the 401(k) Plan made by PIA on behalf of each
of Messrs. Peets, Owens, Bain and Holman, respectively. Also includes an
aggregate of $4,236 and $2,630 in insurance premiums paid by PIA on behalf
of Mr. Peets during the years ended December 31, 1997 and January 1, 1999,
respectively, for certain life insurance and disability insurance policies
of which Mr. Peets is the sole beneficiary. Also includes an aggregate of
$29,820, $14,891 and $9,145 in insurance premiums paid by PIA on behalf of
Mr. Owens during the years ended December 31, 1996, December 31, 1997 and
January 1, 1999, respectively, for certain life and disability insurance
policies of which Mr. Owens is the sole beneficiary.

EMPLOYMENT AGREEMENTS, SEVERANCE ARRANGEMENTS AND CHANGE IN CONTROL ARRANGEMENTS

Mr. Peets entered into an at-will employment agreement with PIA on June 25,
1997. Such agreement is terminable by PIA at any time, subject to, among other
things, severance payments as provided in the employment agreement. From June
25, 1997 through August 9, 1997, Mr. Peets received a salary of $1,200 per day
and from August 10, 1997 to August 9, 1998 he received a salary of $20,834 per
month. Mr. Peets' employment agreement was amended on October 1, 1998 whereby
effective August 10, 1998, Mr. Peets receives a salary of $21,459 per month,
subject to annual review by the PIA Board for possible increases, with a minimum
increase tied to the Los Angeles-Long Beach-Anaheim consumer price index. Mr.
Peets is also entitled to a yearly bonus of up to 100% of his base salary based
upon PIA achieving certain operating results. PIA's obligation to pay a
pro-rated bonus to Mr. Peets upon an acquisition event (such term, as defined in
his employment agreement, includes the consummation of the Merger) is contingent
on PIA achieving certain operating results prior to such event. It is currently
anticipated that no bonus will be payable to Mr. Peets in connection with the
consummation of Merger. The employment agreement also provides for payment of
Mr. Peets' salary for 18 months if PIA or the Combined Company, as the case may
be, terminates his employment without cause (as defined in his employment
agreement) during the two year period following a material corporate event
(which term, as defined in his employment agreement, includes the consummation
of the Merger) or if Mr. Peets terminates his employment for material reason (as
defined in his employment agreement) within one year following such event. His
employment agreement further provides that the vesting schedule for Mr. Peets'
unvested options (222,500 at January 1, 1999) be accelerated by two years upon
the occurrence of an acquisition event. Mr. Peets' employment agreement was
amended further to provide that his consent to certain actions taken by the
Combined Company following the Merger, including the change in Mr. Peets' title,
will not require him to waive his right to resign for material reason, nor will
he be deemed to have waived such right.

Mr. Owens entered into an agreement with PIA on August 10, 1998 that
settles all differences arising out of or relating to Mr. Owen's employment with
PIA. Pursuant to the agreement, Mr. Owens resigned as an employee of PIA and all
its subsidiaries effective November 10, 1998 but continues to serve as Chairman
of the Board and a director of PIA. The agreement provides, among other things,
for severance payments of $37,500 per month for a period of nine months
following the date of his resignation as an employee. In addition, under the
terms of the agreement, Mr. Owens has the right to be nominated to serve on the
PIA Board as long as he holds at least 250,000 shares of PIA Common Stock. Mr.
Owens has indicated that he will waive this right in connection with the Merger.

Ms. Wood entered into a severance agreement with PIA on February 20, 1998
which was amended and restated on October 1, 1998. Ms. Wood or PIA may terminate
the agreement at any time. The agreement provides, among other things, for
payment of Ms. Wood's salary for 18 months if PIA or the Combined Company, as
the case may be, terminates her employment without cause (as defined in Ms.
Wood's severance agreement) during the two year period following a change of
control (such term, as defined in her severance agreement, includes the
consummation of the Merger) or if Ms. Wood terminates her employment for good
reason (as defined in her severance agreement) within one year following such
event. The agreement further provides that the vesting schedule for her unvested
stock options (140,000 at January 1, 1999) shall be accelerated by two years
upon the occurrence of a change of control of PIA (which includes the Merger).
Ms. Wood's agreement was further amended to provide that her consent to certain
actions by the Combined

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Company following the Merger will not require her to waive her right to resign
for good reason, nor will she be deemed to have waived such right.

PIA currently has no written employment or severance contracts with any of
the Named Executive Officers other than as described above.

Messrs. Bain, Holman and Hallsman are entitled to receive severance
payments pursuant to PIA's severance policy. Messrs. Bain and Holman will
receive their salary for 12 months and Mr. Hallsman will receive his salary for
nine months if they are terminated without cause within two years following a
material corporate event (such term, as defined by the PIA Board, includes the
consummation of the Merger). In addition, pursuant to action taken by the PIA
Board, all of the unvested options held by each executive officer of PIA or the
Combined Company, as the case may be, will be automatically vested in full if
such executive officer is terminated without cause within two years following a
material corporate event. The vesting schedule for such options will be
accelerated by two years upon the occurrence of an acquisition event (such term,
as defined by the PIA Board, includes the consummation of the Merger).

STOCK OPTION GRANTS IN LAST FISCAL YEAR

The following table sets forth information regarding each grant of stock
options made during the year ended January 1, 1999 to each of the Named
Executive Officers. No stock appreciation rights ("SARs") were granted during
such period to such persons.

POTENTIAL REALIZABLE
VALUE
INDIVIDUAL GRANTS(1)                       AT ASSUMED ANNUAL
--------------------------------------------------------           RATES
NUMBER OF      PERCENT OF                                      OF STOCK PRICE
SECURITIES    TOTAL OPTIONS                                     APPRECIATION
UNDERLYING     GRANTED TO                                      FOR OPTION(2)
OPTIONS      EMPLOYEES IN      EXERCISE      EXPIRATION    --------------------
NAME           GRANTED(#)      PERIOD(%)      PRICE($/SH)       DATE        5%($)       10%($)
----           ----------    -------------    -----------    ----------    --------    --------

Terry R. Peets........    35,000          10.2            4.500        09/21/08      99,051     251,014
Clinton E. Owens......        --            --               --              --          --          --
Cathy L. Wood.........    50,000          14.5            5.870        08/02/08     168,765     428,068
15,000           4.4            4.500        09/21/08      42,450     107,578
John R. Bain..........    10,000           2.9            4.875        04/07/08      30,659      77,695
35,000          10.2            6.250        08/12/08     137,571     348,631
Donald H. Holman......    10,000           2.9            4.875        04/07/08      30,659      77,695
32,500           9.4            6.250        08/12/08     127,744     323,729
10,000           2.9            4.000        10/28/08      25,156      63,750

---------------
(1) All such options vest over four year periods at an annual rate of 25%
beginning on the first anniversary of the date of grant. Notwithstanding the
foregoing, the vesting schedule for all such options will accelerate by two
years upon the occurrence of an acquisition event (such as the Merger) and
all such options will be fully vested for any officer who is terminated
without cause within two years following an acquisition event.

(2) The potential realizable value is calculated based on the term of the option
(ten years) at its time of grant. It is calculated by assuming that the
stock price on the date of grant appreciates at the indicated annual rate,
compounded annually for the entire term of the option.

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AGGREGATED STOCK OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION
VALUES

The following table sets forth the number and value of the exercisable and
unexercisable options held by each of the Named Executive Officers at January 1,
1999. None of the Named Executive Officers exercised any options during the
fiscal year ended January 1, 1999.

NUMBER OF SECURITIES
UNDERLYING UNEXERCISED         VALUE OF UNEXERCISED
OPTIONS AT FISCAL          IN-THE-MONEY OPTIONS AT
YEAR-END(#)              FISCAL YEAR-END($)(1)
---------------------------   ---------------------------
NAME                         EXERCISABLE   UNEXERCISABLE   EXERCISABLE   UNEXERCISABLE
----                         -----------   -------------   -----------   -------------

Terry R. Peets...................................     62,500        222,500           0              0
Clinton E. Owens.................................    227,026             --           0              0
Cathy L. Wood....................................     25,000        140,000           0              0
John R. Bain.....................................      6,250         63,750           0              0
Donald H. Holman.................................     11,182         68,750           0              0

---------------
(1) All options held by PIA Named Executive Officers were out of the money at
January 1, 1999. As of the year ended January 1, 1999 the fair market value
of PIA Common Stock (as reported by the Nasdaq National Market) was $2.50
which was less than the exercise price of the outstanding options.

COMPENSATION PLANS

1990 Stock Option Plan. In June 1990, PIA adopted a stock incentive plan
(as amended, the "1990 Option Plan"), covering 810,811 shares of PIA Common
Stock that may be granted to certain employees and directors to help them to
acquire shares of PIA Common Stock and thereby benefit directly from PIA's
growth, development and financial success. As of January 1, 1999, there were
393,031 options outstanding under the 1990 Option Plan at a weighted average
exercise price of $6.11 per share, and 95,814 shares of PIA Common Stock had
been issued upon exercise of options at a weighted average price of $5.10 per
share. In December 1995, the PIA Board determined that no further option grants
would be made under the 1990 Option Plan.

The 1990 Option Plan is administered by PIA's Compensation Committee.
Officers, key employees, consultants and directors of PIA and its subsidiaries
are eligible to receive grants under the 1990 Option Plan. Stock options granted
under the 1990 Option Plan are priced at no less than 85% of the fair market
value of the PIA Common Stock on the date of the grant.

1995 Option Plan. In December 1995, PIA adopted the 1995 Option Plan. The
1995 Option Plan currently covers 1,300,000 shares of PIA Common Stock that may
be granted to certain employees, directors, consultants and other persons
providing valuable services to PIA. See "Proposal VI: Option Plan Amendment"
regarding the proposed increase in the number of shares under the 1995 Option
Plan to 3,500,000. As of January 1, 1999, there were 1,016,254 options
outstanding under the 1995 Option Plan at a weighted average exercise price of
$5.69 per share, and 2,000 shares of PIA Common Stock had been issued upon
exercise of options at a weighted average price of $9.87 per share.

The 1995 Option Plan is administered by PIA's Compensation Committee.
Officers, certain directors, key employees and consultants of PIA and its
subsidiaries are eligible to receive grants under the 1995 Option Plan. In
February 1999, PIA approved the amendment and restatement of the 1995 Option
Plan to provide that, among other things, grants may also be made to other
persons providing valuable services to PIA. Stock options granted under the 1995
Option Plan are priced at not less than the fair market value of the PIA Common
Stock on the date of grant. See "Proposal VI -- Option Plan Amendment."

Special Purpose Stock Option Plan. In February 1999, PIA adopted the
Special Purpose Stock Option Plan (the "Special Plan") to provide solely for the
issuance of Substitute Options at the Closing of the Merger. The Special Plan is
administered by the PIA Board. All available options to acquire stock under the
Special Plan will be granted at the Effective Time and no further Substitute
Options may be granted under the Special Plan.

Employee Stock Purchase Plan. On February 17, 1997, PIA adopted an Employee
Stock Purchase Plan ("ESP Plan"). The ESP Plan allows employees of PIA to
purchase PIA Common Stock at a discount,
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without having to pay any commissions on the purchases. The maximum amount that
any employee can contribute to the ESP Plan per quarter is $6,250, and the total
number of shares which are reserved by PIA for purchase under the ESP Plan is
200,000. As of January 1, 1999, 12,290 shares of PIA Common Stock had been
issued at a weighted average price of $3.69 per share.

401(k) Plan. The PIA Savings and Retirement 401(k) Plan (the "401(k) Plan")
covers all PIA employees that do not participate in the pension plans described
below. An employee may elect to defer, in the form of Company contributions to
the 401(k) Plan on his or her behalf, up to 15% of the total compensation that
would otherwise be paid to the employee, not to exceed the amount allowed by
applicable IRS guidelines. In addition, PIA makes matching contributions to the
401(k) Plan each year equal to 50% of the participant's elective contributions
(not to exceed 4% of the total compensation) for such year, and may also make
additional contributions to the 401(k) Plan for one or more plan years to be
allocated to eligible participants in proportion to their total compensation
(including deferred salary contributions) for the year. Contributions are
allocated to each employee's individual account and are invested in a variety of
mutual funds according to the directions of the employee. Employee contributions
are fully vested and non-forfeitable at all times. Company matching
contributions vest over five years.

Deferred Compensation Arrangement. The Deferred Compensation Arrangement
(the "DCA") permits a certain group of highly compensated employees who are
designated by the PIA Board to defer the receipt of some or all of their
compensation until a subsequent year. Participants are not subject to income tax
on the amount of their contributions to the DCA ("Deferrals"), but those amounts
are subject to federal employment taxes. PIA will generally make matching
contributions on behalf of the contributions made by participants to the DCA and
participants will gain a vested interest in the matching contributions, to the
same extent as under the 401(k) Plan. Participants always have a fully vested
right to their Deferrals. Although no amounts are set aside by PIA to pay the
benefits under the DCA, a trust has been established to "informally" fund the
benefits under the DCA. Participants can direct the manner in which the amounts
held on their behalf under the DCA are invested. Although the DCA is not a
tax-qualified retirement plan, under certain circumstances, a participant's
Deferrals may be transferred to the 401(k) Plan. A participant's benefit under
the DCA will be paid in either a lump sum or in installments, as elected by the
participant.

Exec-U-Care Plan. Under the Exec-U-Care Plan (the "Exec-U-Care Plan"), PIA
provides the Chairman and certain other officers of PIA up to $100,000
supplemental medical coverage in addition to the standard medical coverage
generally offered to such persons by PIA. The Exec-U-Care Plan requires that the
employees covered thereunder have a primary medical insurance plan which meets
certain minimum standards of coverage; the Exec-U-Care Plan then covers the
deductible and certain other expenses not paid for by the basic medical
insurance plan.

Pension Plans. Certain of PIA's employees are covered by union-sponsored,
collectively bargained, multi-employer pension plans. PIA has no current
intention of withdrawing from any of these plans.

Incentive Compensation Plan. PIA has established its Incentive Compensation
Plan (the "Incentive Plan") for the compensation of its employees and
executives. All payments under the Incentive Plan are contingent on PIA
achieving its corporate profit goals, PIA's operating divisions achieving their
profit goals, the employee achieving his/her expected performance level, and
approval by the PIA Board.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

No member of the Compensation Committee was at any time during the year
ended January 1, 1999 or at any other time an officer or employee of PIA. No
executive officer of PIA serves as a member of the PIA Board or compensation
committee of any other entity, which has one or more executive officers serving
as a member of the PIA Board or Compensation Committee.

LIMITATION OF LIABILITY AND INDEMNIFICATION MATTERS

PIA's Certificate of Incorporation limits the liability of directors to the
maximum extent permitted by Delaware law. Delaware law provides that directors
of a company will not be personally liable for monetary damages for breach of
their fiduciary duties as directors, except for liability (i) for any breach of
their duty of loyalty to the company or its stockholders, (ii) for acts or
omissions not in good faith or which involve

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intentional misconduct or a knowing violation of law, (iii) for unlawful
payments of dividends or unlawful stock repurchases or redemptions as provided
in Section 174 of the DGCL, or (iv) for any transaction from which the director
derived an improper personal benefit. Pursuant to the Merger Agreement, the SPAR
Companies and the PIA Parties have agreed not to amend such provisions limiting
personal liability in PIA's charter documents for six years following the
Merger.

PIA's bylaws provide that PIA may indemnify its officers, directors,
employees and other agents to the fullest extent permitted by law. Pursuant to
the Merger Agreement, the PIA Parties and the SPAR Companies have agreed to
indemnify to the fullest extent permitted by law (i) each of the seven nominees
for director set forth in Proposal VII: Election of Directors, (ii) each person
who has served as a director of PIA prior to February 28, 1999, and (iii) each
officer holding a title of Senior Vice President or higher with PIA, PIA
California or any of PIA California's subsidiaries as of February 28, 1999 for
six years following the consummation of the Merger. PIA's bylaws also permit it
to secure insurance on behalf of any officer, director, employee or other agent
for any liability arising out of his or her actions in such capacity, regardless
of whether the bylaws would permit indemnification. PIA currently maintains such
insurance and the PIA Parties and the SPAR Companies have also agreed to
maintain PIA's current directors' and officers' liability insurance for PIA as
in effect on the Closing Date for six years following the Merger.

At present, there is no pending litigation or proceeding involving any
director, officer, employee or agent of PIA in which indemnification will be
required or permitted. PIA is not aware of any threatened litigation or
proceeding which may result in a claim for such indemnification.

REPORT OF COMPENSATION COMMITTEE REGARDING COMPENSATION

The Compensation Committee of the PIA Board is comprised of Messrs. Haden
and Collins, two non-employee directors, who administer PIA's executive
compensation programs and policies. PIA's executive compensation programs are
designed to attract, motivate and retain the executive talent needed to optimize
stockholder value in a competitive environment. The programs are intended to
support the goal of increasing stockholder value while facilitating the business
strategies and long-range plans of PIA.

The following is the Compensation Committee's report submitted to the PIA
Board addressing the compensation of PIA's executive officers for 1998.

COMPENSATION POLICY

PIA's executive compensation policy is (i) designed to establish an
appropriate relationship between executive pay and PIA's annual performance, its
long-term growth objectives and its ability to attract and retain qualified
executive officers; and (ii) based on the belief that the interests of the
executives should be closely aligned with PIA's stockholders. The Compensation
Committee attempts to achieve these goals by integrating competitive annual base
salaries with (i) annual incentive bonuses based on corporate performance and
individual contribution, and (ii) stock options through the 1995 Option Plan.
The Compensation Committee believes that cash compensation in the form of salary
and performance-based incentive bonuses provides Company executives with short
term rewards for success in operations, and that long-term compensation through
the award of stock options encourages growth in management stock ownership which
leads to expansion of management's stake in the long-term performance and
success of PIA. The Compensation Committee considers all elements of
compensation and the compensation policy when determining individual components
of pay.

EXECUTIVE COMPENSATION COMPONENTS

As discussed below, PIA's executive compensation package is primarily
comprised of three components: base salary, annual incentive bonuses and stock
options.

Base Salary. In establishing base salary levels for executive officer
positions the Committee and PIA's Chief Executive Officer consider levels of
compensation at comparable companies, levels of responsibility and internal
issues of consistency and fairness. In determining the base salary of a
particular executive, the Committee and the Chief Executive Officer consider
individual performance, including the accomplishment of short- and long-term
objectives, and various subjective criteria including initiative, contribution
to overall

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corporate performance and leadership ability. The Compensation Committee reviews
executive officer salaries annually and exercises its judgment based on all the
factors described above. No specific formula is applied to determine the weight
of each criterion.

Annual Incentive Bonuses. For 1998, the Compensation Committee approved the
1998 Incentive Compensation Plan (the "ICP") which is based upon PIA's 1998
Business Plan (the "Business Plan"). Under the ICP, specified bonuses would have
been payable in the event PIA's earnings per share equaled or exceeded a
specified target amount. No bonuses were paid to executive officers in 1998 and
the ICP was terminated.

Stock Options. Stock options encourage and reward effective management,
which results in long-term corporate financial success, as measured by stock
price appreciation. Stock options covering 197,500 shares were granted to the
executive officers of PIA and stock options covering 133,000 shares were granted
to other employees of PIA during 1998 under the 1995 Option Plan. The number of
options that each executive officer or employee was granted was based primarily
on the executive's or employee's ability to influence PIA's long-term growth and
profitability. The Compensation Committee believes that option grants afford a
desirable long-term compensation method because they closely ally the interests
of management with stockholder value and that grants of stock options are the
best way to motivate executive officers to improve long-term stock market
performance. The vesting provisions of options granted under the 1995 Option
Plan are designed to encourage longevity of employment with PIA and generally
extend over a four-year period.

COMPENSATION OF CHIEF EXECUTIVE OFFICER

The Compensation Committee believes that its current Chief Executive
Officer, Terry R. Peets provides valuable services to PIA and that his
compensation should therefore be competitive with that paid to executives at
comparable companies. In addition, the Compensation Committee believes that an
important portion of his compensation should be based on PIA's performance. Mr.
Peets' base salary and bonus are determined pursuant to his employment
agreement, as described under "-- Employment Agreements, Severance Agreements
and Change in Control Arrangements." In 1998, Mr. Peets' base salary was
$253,894 and he did not receive a bonus for his performance in 1998.

INTERNAL REVENUE CODE SECTION 162(M)

Under Section 162(m) of the Code, with certain exceptions, the amount of
compensation paid to certain executives that is deductible with respect to PIA's
corporate taxes is limited to $1,000,000 annually. It is the current policy of
the Compensation Committee to maximize, to the extent reasonably possible, PIA's
ability to obtain a corporate tax deduction for compensation paid to executive
officers of PIA to the extent consistent with the best interests of PIA and its
stockholders.

COMPENSATION COMMITTEE

Patrick C. Haden
Patrick W. Collins

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COMPANY PERFORMANCE

The following graph shows a comparison of cumulative total returns for PIA,
the NASDAQ Stock Market (U.S. Companies) Index and the NASDAQ Stocks (SIC
7380-7389 U.S. Companies) Miscellaneous Business Services Index for the period
during which PIA Common Stock has been registered under the Exchange Act. The
graph assumes that the value of an investment in PIA Common Stock and in each
such index was $100 on February 29, 1996 (the date PIA Common Stock was
registered under the Exchange Act), and that all dividends have been reinvested.

The comparison in the graph below is based on historical data and is not
intended to forecast the possible future performance of PIA's Common Stock.

COMPARISON OF CUMULATIVE TOTAL RETURN*
AMONG PIA, NASDAQ STOCK MARKET (U.S. COMPANIES)
AND THE NASDAQ STOCKS (SIC 7380-7389 U.S. COMPANIES)
MISCELLANEOUS BUSINESS SERVICES INDEX

PIA                 NASDAQ STOCK MARKET         NASDAQ STOCKS (SIC
---                  (U.S. COMPANIES)        7380-7389 U.S. COMPANIES)
-------------------       MISCELLANEOUS BUSINESS
SERVICES
-------------------------

'3/1/96'                                                 100.0                        100.0                       100.0
'12/31/96'                                                67.7                        119.5                       121.6
'12/31/97'                                                32.3                        146.4                        87.2
'1/1/99'                                                  16.1                        206.3                       106.3

* Assumes $100 invested on March 1, 1996 in stock or index. Total return assumes
reinvestment of dividends. Fiscal year ending December 31, 1996, December 31,
1997 and January 1, 1999.

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DESCRIPTION OF PIA'S CAPITAL STOCK

The authorized capital stock of PIA consists of 15,000,000 shares of PIA
Common Stock, $.01 par value, and 3,000,000 shares of preferred stock, $.01 par
value (the "PIA Preferred Stock").

The following summary of certain provisions of the PIA Common Stock and the
PIA Preferred Stock does not purport to be complete and is subject to, and
qualified in its entirety by, the PIA Certificate of Incorporation and the
bylaws of PIA and by the provisions of applicable law.

COMMON STOCK

As of June 7, 1999, there were 5,480,966 shares of PIA Common Stock
outstanding held of record by approximately 870 stockholders.

The holders of PIA Common Stock are entitled to one vote for each share
held of record. There are no provisions for cumulative voting for election of
directors. Additionally, the PIA Board is not classified and all directors are
elected at each annual meeting. Subject to preferences that may be applicable to
any then outstanding PIA Preferred Stock, holders of PIA Common Stock are
entitled to receive ratably such dividends as may be declared by the PIA Board
out of funds legally available therefor. In the event of a liquidation,
dissolution or winding up of PIA, holders of PIA Common Stock are entitled to
share ratably in all assets remaining after payment of liabilities and the
liquidation preferences of any then outstanding PIA Preferred Stock. Holders of
PIA Common Stock have no preemptive rights and no right to enter their PIA
Common Stock into any other securities. There are no redemption or sinking fund
provisions applicable to the PIA Common Stock. All outstanding shares of PIA
Common Stock are, and all shares of PIA Common Stock to be issued in the Merger,
will be fully paid and nonassessable. The shares of PIA Common Stock to be
issued in the Merger will not be registered under the Securities Act and will be
subject to resale restrictions.

PREFERRED STOCK

There are no shares of PIA Preferred Stock outstanding. However, the PIA
Board has the authority without further stockholder approval, to issue shares of
PIA Preferred Stock in one or more series and to determine the dividend rights,
any conversion rights or rights of exchange, voting rights, rights and terms of
redemption (including sinking fund provisions), liquidation preferences and any
other rights, preferences, privileges and restrictions of any series of
Preferred Stock, and the number of shares constituting such series and the
designation thereof.

The issuance of PIA Preferred Stock may have the effect of delaying,
deferring or preventing a change in control of PIA, making removal of the
present management of PIA more difficult, or resulting in restrictions upon the
payment of dividends and other distributions to the holders of PIA Common Stock.

WARRANTS

As of January 1, 1999, PIA had outstanding warrants providing for the
purchase of an aggregate of 96,395 shares of its PIA Common Stock (the
"Warrants"). The exercise price of the Warrants range from $2.78 to $8.51 per
share, and the Warrants expire at various dates from 2002 through 2004. Under
one of the Warrants, the holder may elect to receive shares equal to the value
of the Warrant or the portion thereof being exercised ("Net Issue Exercise"). If
the holder elects Net Issue Exercise, the holder will receive the number of
shares of PIA Common Stock equal to the product of (a) the number of shares of
PIA Common Stock purchasable under the Warrant, or portion thereof being
exercised, and (b) the fair market value of one share of PIA Common Stock minus
the exercise price for one share, divided by (c) the fair market value of one
share of the PIA Common Stock.

REGISTRATION RIGHTS

Pursuant to that certain Registration Rights Agreement dated as of January
21, 1992, to which PIA and the holders of 1,641,067 shares of Common Stock are
subject (the "Registration Rights Agreement"), such holders are entitled to
certain rights with respect to the registration of such shares under the
Securities Act. Subject to certain limitations, if PIA registers any of its
securities under the Securities Act, either for its own account or the account
of other security holders, such holders are entitled to written notice of the
registration
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and are entitled to include (at PIA's expense) such shares therein; provided,
among other conditions, that the underwriters of any such offering have the
right to limit the number of such shares included in the registration. In
addition, holders of at least 80% of the Registerable Securities (as defined
therein) can require PIA, at any time six months after PIA completes a sale of
shares of PIA Common Stock pursuant to a registration statement under the
Securities Act, and on not more than two occasions, to file a registration
statement under the Securities Act with respect to such shares, and PIA is
required to use its best efforts to effect such registration, subject to certain
conditions and limitations. All fees, costs and expenses of such registrations
(other than underwriting discounts, commissions and transfer taxes, and other
than legal and accounting expenses of such holders) will be borne by PIA.
Further, on not more than two occasions, such holders may require PIA (at PIA's
expense) to register their shares on Form S-3 when such form becomes available
to PIA, subject to certain conditions and limitations.

BUSINESS COMBINATIONS

Generally, Section 203 of the DGCL prohibits a publicly held Delaware
corporation from engaging in a "business combination" with an "interested
stockholder" for a period of three years after the date of the transaction in
which the person became an interested stockholder, unless (i) prior to the date
of the business combination, the transaction is approved by the board of
directors of the corporation, (ii) upon consummation of the transaction which
resulted in the stockholder becoming an interested stockholder, the interested
stockholder owns at least 85% of the outstanding voting stock, or (iii) on or
after such date the business combination is approved by the board and by the
affirmative vote of at least 66 2/3% of the outstanding voting stock which is
not owned by the interested stockholder at an annual or Annual Meeting of the
stockholders. A "business combination" includes mergers, assets, sales and other
transactions resulting in a financial benefit to the stockholder at an annual or
Annual Meeting of stockholders. An "interested stockholder" is a person who,
together with affiliates and associates, owns (or within three years, did own)
15% or more of the corporation's voting stock.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the PIA Common Stock is U.S. Stock
Transfer Corporation.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act ("Section 16(a)") requires PIA's
directors and certain of its officers and persons who own more than 10% of PIA
Common Stock (collectively, "Insiders"), to file reports of ownership and
changes in their ownership of PIA Common Stock with the Commission. Insiders are
required by Commission regulations to furnish PIA with copies of all Section
16(a) forms they file.

Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no Forms 5s were
required for those persons, PIA believes that its Insiders complied with all
applicable Section 16(a) filing requirements for fiscal 1998, with the exception
of Messrs. Bain, Colwell, Haden, Holman, Lewis, Owens and Peets and Ms. Wood,
each of which filed a late Form 5 reporting one transaction and Mr. Coulombe who
filed a late Form 5 reporting two transactions.

INDEPENDENT ACCOUNTANTS

PIA has engaged the independent accounting firm of Deloitte & Touche LLP as
the auditors of PIA for its fiscal year ending January 1, 1999 who have issued
their opinion dated February 18, 1999. PIA has not selected its auditors for
fiscal 2000. PIA will make such determination based upon whether the Merger is
consummated. PIA anticipates selecting Ernst & Young LLP as its auditors for
fiscal 2000, provided that if the Merger is not consummated, PIA anticipates
selecting Deloitte & Touche LLP as its auditors. A representative of Deloitte &
Touche LLP is not expected to be present at the Annual Meeting. If such
representative is present at the Annual Meeting, such representative will have
the opportunity to make a statement if such representative desires to do so and
will be available to respond to appropriate questions from stockholders. A
representative of Ernst & Young LLP is not expected to be present at the Annual
Meeting. If such representative is present at the Annual Meeting, such
representative will have the opportunity to make a statement if such
representative desires to do so and will be available to respond to appropriate
questions from stockholders.

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SUBMISSION OF STOCKHOLDER PROPOSALS

Any stockholder who wishes to present a proposal for action at PIA's 2000
Annual Meeting of Stockholders (the "2000 Annual Meeting") of PIA and who wishes
to have it set forth in the corresponding proxy statement and identified in the
corresponding form of proxy prepared by management in accordance with Rule 14a-8
under the Exchange Act must notify PIA no later than December 2, 1999 in such
form as required under the rules and regulations promulgated by the Commission.
A stockholder proposal that is not submitted by the December 2, 1999 deadline
required by Rule 14a-8 is not required to be included in PIA's form of proxy for
its 2000 Annual Meeting. However, even if a stockholder proposal is not included
in the form of proxy for the 2000 Annual Meeting, the proposal may be brought as
business at the 2000 Annual Meeting if a stockholder gives PIA appropriate
notice in accordance with the requirements under the Exchange Act on or prior to
February 15, 2000. In such a case, PIA representatives may vote the proxies they
hold on such matters in their discretion only if (i) PIA includes, in its proxy
statement, advice on the nature of the matter and how PIA management intends to
exercise its discretion to vote on such matter and (ii) the stockholder
submitting the proposal does not give notice to PIA by February 15, 2000 of its
intent to make, and then conduct, its own proxy solicitation with regard to at
least the percentage of stockholders required under applicable law to approve
the proposal. With respect to any stockholder proposal submitted after February
15, 2000, PIA's representatives may vote all proxies held by them in their sole
discretion on such matter.

AVAILABLE INFORMATION

PIA is subject to the informational requirements of the Exchange Act, and
accordingly, files reports, proxy statements and other information with the
Commission. Such reports, proxy statements and other information filed with the
Commission are available for inspection and copying at the public reference
facilities maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the Commission's Regional Offices
located at Northwestern Atrium Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661 and at Seven World Trade Center, Suite 1300, New York,
New York 10048. Please call the Commission at 1-800-SEC-0330 for further
information on the public reference rooms. PIA's public filings are also
available to the public from commercial document retrieval services and at the
Internet World Wide Web site maintained by the Commission at
"http://www.sec.gov."

PIA'S ANNUAL REPORT

A copy of the 1998 Annual Report to Stockholders (which includes PIA's
Annual Report on Form 10-K) is being mailed to each PIA stockholder of record
together with this Proxy Statement. PIA has also filed with the Commission its
Annual Report on Form 10-K for the fiscal year ended January 1, 1999. This
report contains information concerning PIA and its operations. A COPY OF THIS
REPORT WILL BE FURNISHED TO PIA STOCKHOLDERS WITHOUT CHARGE UPON REQUEST IN
WRITING TO: Cathy L. Wood, Executive Vice President, Chief Financial Officer and
Secretary, PIA Merchandising Services, Inc., 19900 MacArthur Boulevard, Suite
900, Irvine, California 92718; telephone number (949) 474-3504.

OTHER MATTERS

The PIA Board knows of no matter which will be presented for consideration
at the Annual Meeting other than the matters referred to in this Proxy
Statement. All shares represented by PIA proxies will be voted in favor of the
proposals of PIA described herein unless otherwise indicated on the form of
proxy. Should any other matter properly come before the Annual Meeting, it is
the intention of the persons named in the accompanying proxy to vote such proxy
in accordance with their best judgment.

PROXIES AND SOLICITATION

Proxies for the Annual Meeting are being solicited by mail directly and
through brokerage and banking institutions. PIA will pay all expenses in
connection with the solicitation of proxies. In addition to the use of mails,
proxies may be solicited by directors, officers and regular employees of PIA
personally or by telephone.

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PIA will reimburse banks, brokers custodians, nominees and fiduciaries for any
reasonable expenses in forwarding proxy materials to beneficial owners.

All stockholders are urged to complete, sign and promptly return the
enclosed proxy card.

By Order of the Board of Directors,
/s/ Cathy L. Wood

Cathy L. Wood

Secretary

Irvine, California

June 28, 1999

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INDEX TO FINANCIAL STATEMENTS

PAGE
----

AUDITED CONSOLIDATED FINANCIAL STATEMENTS -- PIA
MERCHANDISING SERVICES, INC.
INDEPENDENT AUDITORS' REPORT................................   F-2
FINANCIAL STATEMENTS:
Consolidated balance sheets as of December 31, 1997 and
January 1, 1999...........................................   F-3
Consolidated statements of operations for each of the three
years in the period ended January 1, 1999.................   F-4
Consolidated statements of stockholders' equity for each of
the three years in the period ended January 1, 1999.......   F-5
Consolidated statements of cash flows for each of the three
years in the period ended January 1, 1999.................   F-6
Notes to consolidated financial statements for each of the

three years in the period ended January 1, 1999...........   F-7

UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS -- PIA
MERCHANDISING SERVICES, INC.
Condensed Consolidated Balance sheets as of January 1, 1999
and April 2, 1999 (Unaudited).............................  F-18
Condensed Consolidated Statements of Operations Quarter
Ended April 3, 1998 (Unaudited) and April 2, 1999
(Unaudited)...............................................  F-19
Condensed Consolidated Statements of Cash Flows Quarter
Ended April 3, 1998 (Unaudited) and April 2, 1999
(Unaudited)...............................................  F-20
Notes to Condensed Consolidated Financial Statements
(Unaudited)...............................................  F-21

COMBINED FINANCIAL STATEMENTS -- SPAR GROUP
Report of Independent Auditors..............................  F-24
Combined Balance Sheets.....................................  F-25
Combined Statements of Operations...........................  F-26
Combined Statement of Stockholders' Equity..................  F-27
Combined Statements of Cash Flows...........................  F-28
Notes to Combined Financial Statements......................  F-29

FINANCIAL STATEMENTS -- MCI PERFORMANCE GROUP, INC.
Report of Independent Auditors..............................  F-36
Balance Sheets..............................................  F-37
Statements of Income........................................  F-38
Statements of Stockholder's Equity (Deficit)................  F-39
Statements of Cash Flows....................................  F-40
Notes to Financial Statements...............................  F-41

F-1

141

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of
PIA Merchandising Services, Inc.:

We have audited the accompanying consolidated balance sheets of PIA
Merchandising Services, Inc. and subsidiaries (the Company) as of December 31,
1997 and January 1, 1999, and the related consolidated statements of operations,
stockholders' equity and cash flows for each of the three years in the period
ended January 1, 1999. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in
all material respects, the consolidated financial position of PIA Merchandising
Services, Inc. and subsidiaries as of December 31, 1997 and January 1, 1999, and
the results of their operations and their cash flows for each of the three years
in the period ended January 1, 1999 in conformity with generally accepted
accounting principles.

/s/ Deloitte & Touche LLP

Costa Mesa, California
February 18, 1999
(Except for Note 14, as to which the date is February 28, 1999)

F-2

142

PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)

ASSETS

DECEMBER 31,    JANUARY 1,
1997           1999
------------    ----------

CURRENT ASSETS:
Cash and cash equivalents...................................    $ 12,987       $ 11,064
Accounts receivable, net (Note 3)...........................      16,053         11,222
Income tax refund receivable (Note 6).......................       2,905             81
Prepaid expenses and other current assets...................         816            712
--------       --------
Total current assets..............................      32,761         23,079
PROPERTY AND EQUIPMENT, NET (NOTE 3)........................       2,416          1,991
INVESTMENTS AND OTHER ASSETS:
Investment in affiliate (Note 4)............................         418            553
Other assets................................................         872            431
--------       --------
Total investments and other assets................       1,290            984
--------       --------
Total assets......................................    $ 36,467       $ 26,054
========       ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable............................................    $  3,442       $  1,194
Other current liabilities (Note 3)..........................      13,334          7,951
Income taxes payable (Note 6)...............................          47             90
--------       --------
Total current liabilities.........................      16,823          9,235
LINE OF CREDIT AND LONG-TERM LIABILITIES (NOTE 5)...........         966          2,095
COMMITMENTS AND CONTINGENCIES (NOTE 8)
STOCKHOLDERS' EQUITY (NOTES 10 AND 11):
Preferred stock, $.01 par value; 3,000,000 shares
authorized; none issued and outstanding
Common stock, $.01 par value; 15,000,000 shares authorized;
5,392,558 and 5,477,846 shares issued and outstanding as
of December 31, 1997 and January 1, 1999, respectively....          59             60
Additional paid-in capital..................................      33,429         33,740
Accumulated deficit.........................................     (11,806)       (16,072)
Less treasury stock at cost (507,000 shares at December 31,
1997 and January 1, 1999).................................      (3,004)        (3,004)
--------       --------
Total stockholders' equity........................      18,678         14,724
--------       --------
Total liabilities and stockholders' equity........    $ 36,467       $ 26,054
========       ========

See notes to consolidated financial statements.
F-3

143

PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)

YEARS ENDED
----------------------------------------
DECEMBER 31,   DECEMBER 31,   JANUARY 1,
1996           1997          1999
------------   ------------   ----------

NET REVENUES (NOTE 13)..............................    $119,940       $128,208      $121,788
OPERATING EXPENSES:
Field service costs.................................      94,841        119,830       105,448
Selling expenses....................................      11,133         10,482         8,245
General and administrative expenses (Notes 7, 8 and
9)................................................       8,081         10,234        11,788
Restructuring and other charges (Note 2)............                      5,420
Depreciation and amortization.......................         595            997         1,129
--------       --------      --------
Total operating expenses..................     114,650        146,963       126,610
--------       --------      --------
OPERATING INCOME (LOSS).............................       5,290        (18,755)       (4,822)
OTHER INCOME:
Interest expense....................................         (46)                         (25)
Interest income.....................................         869            799           487
Equity in earnings of affiliate (Note 4)............          72             96           149
--------       --------      --------
Total other income........................         895            895           611
--------       --------      --------
INCOME (LOSS) BEFORE PROVISION (BENEFIT) FOR INCOME
TAXES.............................................       6,185        (17,860)       (4,211)
INCOME TAX PROVISION (BENEFIT) (NOTE 6).............       2,426         (2,761)           55
--------       --------      --------
NET INCOME (LOSS)...................................    $  3,759       $(15,099)     $ (4,266)
========       ========      ========
BASIC EARNINGS (LOSS) PER SHARE (NOTE 12)...........    $   0.70       $  (2.72)     $  (0.78)
========       ========      ========
DILUTED EARNINGS (LOSS) PER SHARE (NOTE 12).........    $   0.63       $  (2.72)     $  (0.78)
========       ========      ========
WEIGHTED AVERAGE COMMON SHARES -- BASIC.............       5,370          5,551         5,439
========       ========      ========
WEIGHTED AVERAGE COMMON SHARES -- DILUTED...........       5,990          5,551         5,439
========       ========      ========

See notes to consolidated financial statements.
F-4

144

PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
YEARS ENDED DECEMBER 31, 1996 AND 1997 AND JANUARY 1, 1999
(IN THOUSANDS)

RETAINED
COMMON STOCK      TREASURY STOCK    ADDITIONAL     EARNINGS         TOTAL
----------------   ----------------    PAID-IN     (ACCUMULATED   STOCKHOLDERS'
SHARES   AMOUNT    SHARES   AMOUNT     CAPITAL       DEFICIT)        EQUITY
------   -------   ------   -------   ----------   ------------   -------------

BALANCE, JANUARY 1, 1996..............  3,564    $ 6,454     --     $    --    $    --       $   (466)      $  5,988
Change in stated par value of shares
from no par to $.01.................            (6,418)                        6,418
Stock issued to the public............  2,138         21                        26,499                        26,520
Stock options exercised...............     58          1                           334                           335
Tax benefit related to exercise of
stock options.......................                                             116                           116
Cashless exercise of warrants (Note
11).................................    131
Net income............................                                                          3,759          3,759
-----    -------    ---     -------    -------       --------       --------
BALANCE, DECEMBER 31, 1996............  5,891         58                        33,367          3,293         36,718
Stock options exercised...............      9          1                            62                            63
Repurchase of common stock............   (507)              507      (3,004)                                  (3,004)
Net loss..............................                                                        (15,099)       (15,099)
-----    -------    ---     -------    -------       --------       --------
BALANCE, DECEMBER 31, 1997............  5,393         59    507      (3,004)    33,429        (11,806)        18,678
Stock options exercised...............     30                                       88                            88
Employee stock purchases..............     12                                       45                            45
Shares issued as bonus (Note 10)......     43          1                           178                           179
Net loss..............................                                                         (4,266)        (4,266)
-----    -------    ---     -------    -------       --------       --------
BALANCE, JANUARY 1, 1999..............  5,478    $    60    507     $(3,004)   $33,740       $(16,072)      $ 14,724
=====    =======    ===     =======    =======       ========       ========

See notes to consolidated financial statements.
F-5

145

PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

YEARS ENDED
------------------------------------------
DECEMBER 31,    DECEMBER 31,    JANUARY 1,
1996            1997           1999
------------    ------------    ----------

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss).......................................    $  3,759        $(15,099)      $(4,266)
Adjustments to reconcile net income (loss) to net cash
used in operating activities:
Depreciation and amortization.........................         595             997         1,129
Equity in earnings of affiliate.......................         (72)            (96)         (149)
Deferred income taxes, net............................        (167)            360
Provision for doubtful receivables and other, net.....         105             918          (270)
Restructuring and other charges (Note 2)..............                       5,420
Changes in assets and liabilities:
Accounts receivable................................     (10,522)          5,659         5,101
Income tax refund receivable..........................                      (2,905)        2,824
Prepaid expenses and other current assets..........          74            (252)          104
Other assets.......................................         213            (744)          441
Accounts payable...................................      (1,066)          2,670        (2,248)
Other current liabilities..........................       5,657             173        (5,204)
Income taxes payable...............................        (228)            (64)           43
Other liabilities..................................                         131          (871)
--------        --------       -------
Net cash used in operating activities.........      (1,652)         (2,832)       (3,366)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment.....................        (332)           (759)         (516)
Capitalization of software development costs............      (1,987)                         (174)
Investment in affiliate.................................        (150)
--------        --------       -------
Net cash used in investing activities.........      (2,469)           (759)         (690)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on long-term debt....................      (3,400)             --            --
Proceeds from long-term debt............................                                     2,000
Proceeds from issuance of common stock to the public....      26,520
Proceeds from issuance of common stock..................         335              63           133
Repurchase of common stock..............................                      (3,004)
--------        --------       -------
Net cash provided by(used in) financing
activities..................................      23,455          (2,941)        2,133
--------        --------       -------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS....      19,334          (6,532)       (1,923)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD..........         185          19,519        12,987
--------        --------       -------
CASH AND CASH EQUIVALENTS, END OF PERIOD................    $ 19,519        $ 12,987       $11,064
========        ========       =======
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION --Cash
paid (refunded) during the year for:
Interest..............................................    $     69        $     --       $    25
========        ========       =======
Income taxes..........................................    $  2,853        $    129       $(2,753)
========        ========       =======

See Notes 10 and 11 to consolidated financial statements for description of
noncash transactions.

See notes to consolidated financial statements.
F-6

146

PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JANUARY 1, 1999

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Company Description -- PIA Merchandising Services, Inc. and subsidiaries
("Company") provides in-store merchandising services primarily on behalf of
branded product manufacturers at retail grocery stores, mass merchandisers, drug
stores and discount drug stores. The Company's in-store services include
checking for authorized distribution of client products, cutting in products
approved for distribution but not present on the shelf, setting category shelves
in accordance with approved store schematics, ensuring shelf tags are in place,
checking for the overall salability of clients' products, and performing new
product and promotion selling. The Company also performs special in-store
projects, such as new store sets and existing store resets, remerchandisings,
remodels and category implementations, and executes and maintains point of
purchase displays and materials. In addition, the Company collects and provides
to certain clients a variety of merchandising data that is category and
store-specific. The Company is also a supplier of regularly scheduled, shared
merchandising services in the United States. The Company's management has
evaluated the allocation of resources in assessing performance and determined
the Company operates in three operating segments, dedicated services, shared
services, and project services (Note 13).

Principles of Consolidation -- The consolidated financial statements
include the accounts of PIA Merchandising Services, Inc. and its wholly owned
subsidiaries. All significant intercompany accounts and transactions have been
eliminated in consolidation. The equity method of accounting is used for the
Company's investment in affiliate (Note 4).

Cash Equivalents -- The Company considers all highly liquid short-term
investments with original maturities of three months or less to be cash
equivalents.

Accounts Receivable and Credit Risk -- During the ordinary course of the
Company's business, the Company grants trade credit to its clients, which
consist primarily of packaged goods manufacturers and retailers. The Company's
ten largest clients generated approximately 57.0%, 69.0% and 75.0% of the
Company's net revenues for the fiscal years ended December 31, 1996, December
31, 1997 and January 1, 1999, respectively.

During the fiscal year ended January 1, 1999, three of the Company's
clients accounted for 15.6%, 12.6% and 10.6% of the Company's net revenues.
During 1997, two clients accounted for 16.0% and 13.6% of the Company's net
revenues. Given the significant amount of net revenues derived from certain
clients, collectibility issues arising from financial difficulties of any of
these clients or the loss of any such clients could have a material adverse
effect on the Company's business. Unbilled accounts receivable represent
merchandising services performed that are pending billing until the requisite
documents have been processed or projects have been completed (Note 3).

Property and Equipment -- Property and equipment are stated at cost and
depreciated on the straight-line method over estimated useful lives, ranging
from three to seven years. Leasehold improvements are amortized over the
estimated useful life of the asset or the term of the lease, whichever is
shorter.

The Company has chosen to early adopt Statement of Position ("SOP") No.
98-1, Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use as of January 1, 1998. The SOP provides guidance in accounting for
the costs of computer software developed or obtained for internal use. The
effects of the adoption of the SOP have been reflected in the 1998 consolidated
financial statements and are not material.

Other Assets -- Other assets consist primarily of refundable deposits.

Deferred Revenue -- Client payments received in advance of merchandising
services performed are classified as deferred revenue (Note 3).

Amounts Held on Behalf of Third Parties -- Amounts held on behalf of third
parties arise from agreements with retailers to provide services for their
private label manufacturers' products and represent

F-7

147
PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JANUARY 1, 1999

amounts to be utilized for certain future services including
merchandising-related expenditures on behalf of the retailers (Note 3). These
agreements renew annually and are cancelable on December 31 of each year or upon
ninety-day written notice by either party.

Revenue Recognition -- The Company's services are provided under various
types of contracts, which consist primarily of fixed fee and commission-based
arrangements. Under fixed fee arrangements, revenues are recognized monthly
based on a fixed fee per month over a service period of typically one year, as
defined in the contract.

The Company's commission-based contracts provide for commissions to be
earned based on a specified percentage of the client's net sales of certain
products to designated retail chains. In conjunction with these commission
arrangements, the Company receives draws on a monthly basis, which are to be
applied against commissions earned. These draws approximate estimated minimum
revenue to be earned on the contract and are recognized on a monthly basis, over
a service period of typically one-year. The Company recognizes adjustments on
commission-based sales in the period such amounts become determinable.
Commissions are usually owed to the Company in excess of draws received.

The Company also performs services on a specific project basis. Revenues
related to these projects are recognized as services are performed or costs are
incurred. Certain of the Company's contracts are to perform project work over a
specified period ranging from one to twelve months. Revenue under these types of
contracts is recognized essentially on the percentage of completion method.
Provisions for estimated losses on uncompleted contracts are recorded in the
period in which such losses are determinable.

Field Service Costs -- Field service costs are comprised principally of
field labor and related costs and expenses required to provide shared services,
project activities, key account management and related technology costs, as well
as field overhead required to support the activities of these groups of
employees.

Accounting for Stock-Based Compensation -- Statement of Financial
Accounting Standards (SFAS) No. 123, Accounting for Stock-Based Compensation,
requires disclosure of fair value method of accounting for stock options and
other equity instruments. Under the fair value method, compensation cost is
measured at the grant date based on the fair value of the award and is
recognized over the service period, which is usually the vesting period. The
Company has chosen, under the provisions of SFAS No. 123, to continue to account
for employee stock-based transactions under Accounting Principles Board (APB)
Opinion No. 25, Accounting for Stock Issued to Employees. The Company has
disclosed in Note 11 to the consolidated financial statements pro forma diluted
net income (loss) and net income (loss) per share as if the Company had applied
the fair value method of accounting.

Income Taxes -- Income taxes are provided for the tax effects of
transactions reported in the financial statements and consist of taxes currently
due plus deferred taxes related primarily to differences between the basis of
assets and liabilities for financial and tax reporting. The deferred tax assets
and liabilities represent the future tax return consequences of those
differences, which will either be taxable or deductible when the assets and
liabilities are recovered or settled. Deferred taxes are also recognized for
operating losses that are available to offset future taxable income and tax
credits that are available to offset future income taxes. In the event the
future consequences of differences between financial reporting bases and tax
bases of the Company's assets and liabilities result in deferred tax assets, an
evaluation of the probability of being able to realize the future benefits
indicated by such asset is required. A valuation allowance is provided when it
is more likely than not that some portion or the entire deferred tax asset will
not be realized.

Comprehensive Income -- The Company has adopted SFAS No. 130, Reporting
Comprehensive Income. For the years ended January 1, 1999, December 31, 1997 and
December 31, 1996, the Company has no reported differences between net income
(loss) and comprehensive income (loss). Therefore, statements of comprehensive
income (loss) have not been presented.

F-8

148
PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JANUARY 1, 1999

Earnings Per Share -- The Company has adopted SFAS No. 128, Earnings per
Share, which replaces the presentation of "Primary" earnings per share with
"Basic" earnings per share and the presentation of "Fully Diluted" earnings per
share with "Diluted" earnings per share. Prior periods have been restated to
reflect the change in presentation.

Basic earnings per share amounts are based upon the weighted-average number
of common shares outstanding. Diluted earnings per share amounts are based upon
the weighted-average number of common and potential common shares for each
period presented. Potential common shares include stock options, using the
treasury stock method.

Vendor Concentration -- In addition to the Company's own employees, the
Company utilizes a force of trained merchandisers employed by a third-party
payrolling company engaged principally in the performance of retailer-mandated
and project activities. For the fiscal years ended December 31, 1996, December
31, 1997 and January 1, 1999, the Company paid this payrolling company
approximately $31,145,000, $38,936,000 and $32,213,000, respectively (Note 3).

Use of Estimates -- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from these estimates.

Fair Value of Financial Instruments -- The Company's consolidated balance
sheets include the following financial instruments: cash and cash equivalents,
accounts receivable, accounts payable and long term debt. The Company considers
carrying amounts of current assets and liabilities in the consolidated financial
statements to approximate the fair value for these financial instruments,
because of the relatively short period of time between origination of the
instruments and their expected realization. The carrying amounts of long-term
debt approximate fair value because the obligation bears interest at a floating
rate.

Change in Fiscal Year -- Effective January 1, 1998, the Company changed its
fiscal year end for financial statement purposes from a calendar year to a
52/53-week fiscal year. Beginning with fiscal year 1998, the Company's fiscal
year will end on the Friday closest to December 31. The years ended December 31,
1997 and January 1, 1999 each consist of approximately 52 weeks. The Company
does not believe that this change has a material impact on the financial
statements.

New Accounting Pronouncements -- The Company has adopted SFAS No. 131.
Disclosure About Segments of an Enterprise and Related Information. In
accordance with SFAS No. 131, the Company has disclosed in Note 13 certain
information about the Company's products and major customers.

In June 1998, the Financial Accounting Standards Board (the "FASB") issued
SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities,
which the Company is required to adopt effective in its fiscal year 2000. SFAS
No. 133 will require the Company to record all derivatives on the balance sheet
at fair value. The Company does not currently engage in hedging activities and
will continue to evaluate the effect of adopting SFAS No. 133. The Company is
expected to adopt SFAS No. 133 in its fiscal year 2000.

2. RESTRUCTURING AND OTHER CHARGES

During 1997, the Company experienced declining gross margins and resultant
operating losses, due to service performance issues and the loss of several
shared clients. This decline in margins has resulted in insufficient margin
dollars to cover the overhead structure, which had developed at the field level
and in the general corporate area. In the quarter ended September 30, 1997, the
Company addressed these conditions by restructuring its operations, focusing on
a more disciplined and functional operational structure, and redirecting its
technology strategies, resulting in a $5,420,000 charge for restructuring and
other charges. The

F-9

149
PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JANUARY 1, 1999

restructuring charges consist of $1,522,000 identified severance of corporate
and field employees and lease costs in various management and administrative
functions. The restructuring charges also include $2,121,000 in the write downs
and accruals associated with the abandonment of certain internally developed
software and specialized computer equipment under long-term operating leases due
to a redirection of the Company's technology strategies (Note 3). Other charges
consisted primarily of $1,297,000 of reserves and write offs related to
unprofitable contracts, and $480,000 of costs associated with changes in the
Company's service delivery model. At January 1, 1999, $428,000 is remaining in
accrued liabilities in the accompanying consolidated balance sheet consisting of
$410,000 to specialized computer equipment under long-term operating leases no
longer in use and $18,000 to employee separation costs.

The following table displays a rollforward of the liabilities for
restructuring and other charges from December 31, 1996 to January 1, 1999 (in
thousands):

INITIAL
RESTRUCTURING                DECEMBER 31,                JANUARY 1,
AND OTHER        1997          1997          1998         1999
TYPE OF COST                      CHARGES      DEDUCTIONS     BALANCE      DEDUCTIONS    BALANCE
------------                   -------------   ----------   ------------   ----------   ----------

Employee Separation...........................     $1,372        $  (885)       $  487       $  (469)       $ 18
Facility Closing............................        150                          150          (150)
Technology writedown and related operating
leases....................................      2,121         (1,086)        1,035          (625)        410
Unprofitable Contracts......................      1,297           (797)          500          (500)
Other.......................................        480           (338)          142          (142)
------        -------        ------       -------        ----
$5,420        $(3,106)       $2,314       $(1,886)       $428
======        =======        ======       =======        ====

Management believes that the remaining reserves for restructuring are
adequate to complete its plan.

3. SUPPLEMENTAL BALANCE SHEET INFORMATION

Accounts receivable, net, consist of the following (in thousands):

DECEMBER 31,    JANUARY 1,
1997           1999
------------    ----------

Trade................................................    $15,411        $ 9,511
Unbilled.............................................      2,034          2,358
Non-trade............................................         59            174
-------        -------
17,504         12,043
Allowance for doubtful accounts and other............     (1,451)          (821)
-------        -------
$16,053        $11,222
=======        =======

Property and equipment, net, consist of the following (in thousands):

DECEMBER 31,    JANUARY 1,
1997           1999
------------    ----------

Equipment............................................    $ 3,680        $ 3,873
Furniture and fixtures...............................        662            719
Leasehold improvements...............................        160            165
Capitalized software development costs...............        902          1,076
-------        -------
5,404          5,833
Less accumulated depreciation and amortization.......     (2,988)        (3,842)
-------        -------
$ 2,416        $ 1,991
=======        =======

During 1997, the Company recorded certain restructuring charges (Note 2).
In connection with the restructuring, the Company recorded a charge of
approximately $1,000,000 for the impairment of capitalized software costs.

F-10

150
PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JANUARY 1, 1999

Other current liabilities consist of the following (in thousands):

DECEMBER 31,    JANUARY 1,
1997           1999
------------    ----------

Accrued salaries and other related costs.............    $ 1,237         $1,123
Accrued payroll to third party.......................      2,847          1,557
Accrued medical and compensation insurance...........      1,456          1,906
Deferred revenue.....................................      1,039            426
Amounts held on behalf of third parties..............      1,116            641
Accrued rebate.......................................      2,200
Restructuring costs..................................      1,475            428
Other................................................      1,964          1,870
-------         ------
$13,334         $7,951
=======         ======

4. INVESTMENT IN AFFILIATE

During 1996, the Company increased its voting ownership in Ameritel
Corporation, a full-service telemarketing company, to 20%. Accordingly, the
Company changed its method of carrying the investment from cost to equity as
required by generally accepted accounting principles. The change in method was
not material to the carrying value of the investment in the accompanying
financial statements.

Following is a summary of condensed unaudited financial information
pertaining to Ameritel Corporation (in thousands):

DECEMBER 31,    JANUARY 1,
1997           1999
------------    ----------

Current assets.......................................     $1,545         $2,816
Noncurrent assets....................................      1,252          3,786
Current liabilities..................................      1,443          1,827
Long-term liabilities................................        128          2,803
Stockholders' equity.................................      1,226          1,972
Net income for the year..............................        523            746

5. LINE OF CREDIT

On December 10, 1998, the Company entered a long-term revolving line of
credit agreement a bank to provide an asset-based credit facility with maximum
borrowing up to $20.0 million. Under this agreement, the line is to expire on
December 7, 2001. All revolving credit loans bear interest at the agent bank's
prime rate plus 0.25 % (7.75% at January 1, 1999, or 8.0%), or the London
Interbank Offered Rate ("LIBOR") plus 2.75% (5.06% at January 1, 1999, or 7.81%)
at the Company's option. As of January 1, 1999, the outstanding balance on the
line of credit was $2,000,000. The Company's available borrowing is the sum of
80% of all eligible accounts receivable, plus 100% of eligible cash collateral
less outstanding revolving credit loan.

Under the terms of the long-term debt agreement, the Company is subject to
certain financial covenants. Key covenants require the Company to maintain a
minimum current ratio, total liabilities to tangible net worth ratio, tangible
net worth, working capital, and net income. At January 1, 1999, the Company
complied with all such covenants. As of January 1, 1999, available borrowings
were $4,796,000.

F-11

151
PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JANUARY 1, 1999

6. INCOME TAXES

The provision (benefit) for income taxes is summarized below for the years
ended December 31, 1996, December 31, 1997 and January 1, 1999 (in thousands):

YEARS ENDED
----------------------------------------
DECEMBER 31,   DECEMBER 31,   JANUARY 1,
1996           1997          1999
------------   ------------   ----------

Current income taxes:
Federal...........................................     $2,163        $(3,082)      $    --
State.............................................        430            (19)           55
------        -------       -------
2,593         (3,101)           55
Deferred income taxes:
Federal........................................       (135)        (2,846)       (1,554)
State..........................................        (32)          (380)           (1)
------        -------       -------
(167)        (3,226)       (1,555)
Increase in valuation allowance...................                     3,566         1,555
------        -------       -------
Provision (benefit) for income taxes..............     $2,426        $(2,761)      $    55
======        =======       =======

Reconciliation between the provision (benefit) for income taxes as required
by applying the federal statutory rate of 35% to that included in the financial
statements is as follows (in thousands):

YEARS ENDED
----------------------------------------
DECEMBER 31,   DECEMBER 31,   JANUARY 1,
1996           1997          1999
------------   ------------   ----------

Provision (benefit) for income taxes at federal
statutory rate.................................     $2,165        $(6,251)      $(1,473)
State income taxes, net of federal benefit........        259            (12)           14
Other permanent differences.......................        (31)
Change in valuation allowance.....................                     3,566         1,555
Other.............................................         33            (64)          (41)
------        -------       -------
Provision (benefit) for income taxes..............     $2,426        $(2,761)      $    55
======        =======       =======

Deferred taxes consist of the following (in thousands):

DECEMBER 31,   JANUARY 1,
1997          1999
------------   ----------

Net operating loss carryforwards............................    $ 1,877       $ 3,880
State tax provision.........................................       (270)         (146)
Accrued compensation........................................        131           229
Accrued insurance...........................................        427           793
Allowance for doubtful accounts and other receivable........      1,158           312
Depreciation................................................       (180)          (52)
Other.......................................................        423           105
-------       -------
Deferred tax assets.........................................      3,566         5,121
Valuation allowance.........................................     (3,566)       (5,121)
-------       -------
Net deferred taxes..........................................    $    --       $    --
=======       =======

At January 1, 1999, the Company has net operating loss carry forwards of
$10,688,000 available to reduce future federal taxable income and $3,815,000
available to reduce future California State taxable income. The Company has
Federal and California net operating loss carry forwards which begin expiring in
the year 2012

F-12

152
PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JANUARY 1, 1999

and 2002, respectively. The Company has established a full valuation allowance
for the deferred tax assets due to its continuing losses.

7. EMPLOYEE BENEFITS

Pension Plans -- Certain of the Company's employees are covered by
union-sponsored, collectively bargained, multi-employer pension plans. Pension
expense related to these plans was approximately $172,000, $178,000 and $202,000
for the years ended December 31, 1996, December 31, 1997 and January 1, 1999,
respectively. The administrators have advised the Company that there were no
withdrawal liabilities as of December 1990, the most recent date for which an
analysis was made. The Company has no current intention of withdrawing from any
of these plans.

Retirement Plan -- The Company has a 401(k)-retirement plan covering all
employees not participating in the pension plans. Eligible employees, as defined
by the 401(k) plan, may elect to contribute up to 15% of their total
compensation; not to exceed the amount allowed by the Internal Revenue Service
code guidelines. The Company makes matching contributions to the 401(k) plan
each year equal to 50% of the employee contributions, not to exceed 4% of the
total compensation, and can also make discretionary matching contributions.
Employee contributions are fully vested at all times, and the Company's matching
contributions vest over five years. The Company's matching contributions were
approximately $468,000, $506,000 and $471,000 for the years ended December 31,
1996, December 31, 1997 and January 1, 1999, respectively.

8. COMMITMENTS AND CONTINGENCIES

The Company leases its facilities under operating leases and leases certain
computer and office equipment under two- to five-year operating lease
agreements. Total rent expense relating to these leases was approximately
$2,756,000, $6,369,000 and $5,646,000 for the years ended December 31, 1996,
December 31, 1997 and January 1, 1999, respectively, with sublease income of
$101,000 in fiscal year 1998.

The following table sets forth future minimum lease payments under
noncancelable operating leases as of January 1, 1999 (in thousands):

FISCAL YEAR:                      RENT     SUBLEASE    TOTAL
------------                     ------    --------    ------

1999...........................................  $4,038     $(261)     $3,777
2000...........................................   1,882                 1,882
2001...........................................   1,238                 1,238
2002...........................................     903                   903
2003...........................................     147                   147
------     -----      ------
Total future minimum lease payments............  $8,208     $(261)     $7,947
======     =====      ======

9. RELATED-PARTY TRANSACTIONS

The Company receives legal services from a law firm previously affiliated
with its principal stockholder and paid approximately $516,000, $189,000 and
$114,000 for such legal services during the years ended December 31, 1996,
December 31, 1997 and January 1, 1999, respectively.

The Company has an investment in an affiliate, which provides telemarketing
and related services (Note 4). The Company paid approximately $524,000 and
$898,000 during the years ended December 31, 1997 and January 1, 1999,
respectively. Approximately $50,000 was payable to the affiliate at January 1,
1999.

10. STOCK TRANSACTIONS AND WARRANTS

In March 1996, the Company completed an initial stock offering and sold
1,788,000 shares of its common stock, at a net price of $13.02 per share. An
additional 349,800 shares of common stock were sold also at a net

F-13

153
PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JANUARY 1, 1999

$13.02 per share, pursuant to an underwriters over-allotment provision. The net
proceeds of the approximately $26.5 million raised by the Company were used, in
part, to repay existing bank debt.

During the three fiscal years 1996, 1997 and 1998, the Company issued the
following shares of common stock, 57,798 shares, 8,107 shares, and 30,328
shares, respectively as a result of options that were exercised (Note 11). The
income tax effect of any difference between the market price of the Company's
common stock at the grant date and the market price at the exercise date is
credited to additional paid-in capital, as required.

On February 17, 1997, the Company adopted an Employee Stock Purchase Plan
("ESP Plan"). The ESP Plan allows employees of the Company to purchase common
stock at a discount, without having to pay any commissions on the purchases. The
discount is the greater of 15% of the fair market value ("FMV") at the end of
the reportable period or the difference between the FMV at the beginning and end
of the reportable period. The maximum amount that any employee can contribute to
the ESP Plan per quarter is $6,250, and the total number of shares reserved by
the Company for purchase under the ESP Plan is 200,000. During 1998, the Company
issued 12,290 shares of common stock, at a weighted average price of $3.69 per
share.

In May 1998, the Company issued 42,670 shares of common stock to two
employees as compensation for services and recorded $179,000 of compensation
expense.

During February 1996, 100,000 warrants issued in conjunction with a 1992
line of credit for the purchase of 152,405 shares of common stock at $1.82 per
share, were exercised through a cashless exercise, based on the estimated fair
market value of the Company's common stock, at the date of exercise of $14.00,
reduced the number of shares issued to 87,000. During October 1996, the
remaining warrants to purchase 52,405 shares of common stock at $1.82 per share
were exercised through a cashless exercise, based on the estimated fair value of
the Company's common stock at the date of exercise of $12.75, reduced the number
of shares issued to 44,924.

11. STOCK OPTIONS

The Company has three stock option plans: the 1990 Stock Option Plan (1990
Plan), the 1995 Stock Option Plan (1995 Plan), and the 1995 Director's Plan
(Director's Plan).

The 1990 Plan is a nonqualified option plan providing for the issuance of
up to 810,811 shares of common stock to officers, directors and key employees.
The options have a term of 10 years and one week and are either fully vested or
will vest ratably no later than five years from the grant date. During 1995, the
Company elected to no longer grant options under this plan.

The 1995 Plan provides for the granting of either incentive or nonqualified
stock options to specified employees, consultants and directors of the Company
for the purchase of up to 1,300,000 shares of the Company's common stock. The
options have a term of ten years, except in the case of incentive stock options
granted to greater than ten-percent stockholders of the Company, for which the
term is five years. The exercise price of nonqualified stock options must be
equal to at least 85% of the fair market value of the Company's common stock at
the date of grant; the exercise price of incentive stock options must be equal
to at least the fair market value of the Company's common stock at the date of
grant. At January 1, 1999, options to purchase 281,746 shares were available for
grant under this plan.

The Director's Plan is a stock option plan for nonemployee directors and
provides for the purchase of up to 100,000 shares of the Company's common stock.
An option to purchase 1,500 shares of the Company's common stock shall be
granted automatically each year to each director, following the Company's annual
stockholders' meeting. The exercise price of options issued under this plan
shall be not less than the fair market value of the Company's common stock on
the date of grant. Each option under this plan shall vest and become exercisable
in full on the first anniversary of its grant date, provided the optionee is
reelected as a director of the Company. The maximum term of options granted
under the plan is ten years and one day,

F-14

154
PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JANUARY 1, 1999

subject to earlier termination following an optionee's cessation of service with
the Company. At January 1, 1999, options to purchase 89,500 shares were
available for grant under this plan.

The Company has adopted the disclosure-only provisions of SFAS No. 123,
Accounting for Stock-Based Compensation. No compensation cost has been
recognized for the stock option plans. The impact of stock options granted prior
to 1995 has been excluded from the pro forma calculation; accordingly, the 1996,
1997 and 1998 pro forma adjustments may not be indicative of future period pro
forma adjustments, when the calculation will apply to all applicable future
stock options. Had compensation cost for the Company's option plans been
determined based on the fair value at the grant date for awards in 1996, 1997
and 1998 consistent with the provisions of SFAS No. 123, the Company's net
income (loss) and net income (loss) per share would have been reduced to the pro
forma amounts indicated below:

YEARS ENDED
----------------------------------------
DECEMBER 31,   DECEMBER 31,   JANUARY 1,
1996           1997          1999
------------   ------------   ----------

Net income (loss), as reported (in thousands)...............     $3,759        $(15,099)     $(4,266)
Net income (loss), pro forma (in thousands).................     $3,564        $(15,808)     $(5,420)
Basic net income (loss) per share, as reported..............     $ 0.70        $  (2.72)     $ (0.78)
Basic net income (loss) per share, pro forma................     $ 0.66        $  (2.85)     $ (1.00)
Diluted net income (loss) per share, as reported............     $ 0.63        $  (2.72)     $ (0.78)
Diluted net income (loss) per share, pro forma..............     $ 0.60        $  (2.85)     $ (1.00)

The fair value of each option grant is estimated based on the date of grant
using the Black-Scholes option-pricing model, using the return on a ten year
treasury bill, with the following weighted-average assumptions used for grants
in 1998: dividend yield of 0%; expected volatility of 104.6%; risk-free interest
rate of 4.7%; and expected lives of six years. The following weighted-average
assumptions were used for grants in 1997: dividend yield of 0%; expected
weighted-average volatility of 79.5%; risk-free interest rate of 6.2%; and
expected lives of six years. The following assumptions were used for grants in
1996: dividend yield of 0%; expected volatility of 101.7%; risk-free interest
rate of 6.3%; and expected lives of six years.

The following table summarizes activity under the Company's 1990 Plan, 1995
Plan and Directors' Plan:

YEARS ENDED
-------------------------------------------------------------------
DECEMBER 31,           DECEMBER 31,             JANUARY 1,
1996                   1997                    1999
-------------------   ---------------------   ---------------------
WEIGHTED-               WEIGHTED-               WEIGHTED-
AVERAGE                 AVERAGE                 AVERAGE
EXERCISE                EXERCISE                EXERCISE
SHARES      PRICE      SHARES       PRICE      SHARES       PRICE
-------   ---------   ---------   ---------   ---------   ---------

Options outstanding, beginning of
year..............................  791,356    $ 6.76       883,202    $ 8.12     1,526,851     $6.10
Options granted.....................  234,540    $13.57       938,325    $ 5.55       350,500     $5.49
Options exercised...................  (57,798)   $ 5.85        (8,107)   $ 7.77       (30,328)    $2.91
Options canceled or expired.........  (84,896)   $ 9.25      (286,569)   $10.45      (408,738)    $6.51
-------               ---------               ---------
Options outstanding, end of year....  883,202    $ 8.12     1,526,851    $ 6.10     1,438,285     $5.91
=======               =========               =========
Option price range at end of year...    $2.78 to $14.00        $2.78 to $14.00         $2.78 to $14.00
Option price range for exercised
shares............................    $2.78 to $9.81         $7.40 to $8.51          $2.78 to $5.32
Weighted-average fair value of
options granted during the year...   $11.18                   $4.01                   $5.49

F-15

155
PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JANUARY 1, 1999

The following table summarizes information about fixed-price stock options
outstanding at January 1, 1999:

OPTIONS OUTSTANDING
----------------------------------------      OPTIONS EXERCISABLE
WEIGHTED-                --------------------------
NUMBER         AVERAGE     WEIGHTED-       NUMBER       WEIGHTED-
OUTSTANDING AT    REMAINING     AVERAGE    EXERCISABLE AT    AVERAGE
RANGE OF         JANUARY 1,     CONTRACTUAL   EXERCISE      JANUARY 1,     EXERCISE
EXERCISE PRICES         1999           LIFE         PRICE          1999          PRICE
----------------   --------------   -----------   ---------   --------------   ---------

$ 2.78       129,729         3.17        $ 2.78        129,729        $ 2.78
$3.69 - $ 6.25     1,005,119         8.91        $ 5.51        208,537        $ 5.55
$7.40 - $ 9.81       263,302         5.09        $ 7.75        261,275        $ 7.74
$14.00        40,135         7.51        $14.00         35,135        $14.00
---------                                   -------
$2.78 to $14.00     1,438,285         7.65        $ 5.91        634,676        $ 6.35
=========                                   =======

Outstanding warrants are summarized below:

SHARES SUBJECT   EXERCISE PRICE
TO WARRANTS       PER SHARE
--------------   --------------

Balance, January 1, 1996....................................      248,800      $1.82 - $8.51
Exercised.................................................     (152,405)              $1.82
--------
Balance, December 31, 1996................................       96,395      $2.78 - $8.51
--------
Balance, December 31, 1997................................       96,395      $2.78 - $8.51
--------
Balance, January 1, 1999..................................       96,395      $2.78 - $8.51
========

The above warrants expire at various dates from 2002 through 2004.

12. EARNINGS PER SHARE

YEARS ENDED
----------------------------------------
DECEMBER 31,   DECEMBER 31,   JANUARY 1,
1996           1997          1999
------------   ------------   ----------
(IN THOUSANDS, EXCEPT PER SHARE DATA)

Basic:
Weighted-average common shares outstanding................      5,370           5,551        5,439
Net income (loss).........................................     $3,759        $(15,099)     $(4,266)
======        ========      =======
Basic earnings per share....................................     $ 0.70        $  (2.72)     $ (0.78)
======        ========      =======
Diluted:
Weighted-average common shares -- basic...................      5,370           5,551        5,439
Potential common shares...................................        620
------        --------      -------
Weighted-average common shares -- diluted.................      5,990           5,551        5,439
======        ========      =======
Net income (loss)...........................................     $3,759        $(15,099)     $(4,266)
======        ========      =======
Diluted earnings per share..................................     $ 0.63        $  (2.72)     $ (0.78)
======        ========      =======

13. SUPPLEMENTAL INFORMATION

The Company's primary line of business is merchandising and sales services.
The Company does not have separate segment (line service) managers or discrete
financial information for its three primary lines of services. Therefore,
management considers its merchandising and sales services a single operating
segment.

F-16

156
PIA MERCHANDISING SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JANUARY 1, 1999

The information reported in the following table includes revenues for the
Company's three primary merchandising and sales service line (in thousands):

SERVICE LINES
------------------------------------------------
DEDICATED   SHARED SERVICE   PROJECTS    TOTAL
---------   --------------   --------   --------

Fiscal year 1998
Net revenues.......................................   $38,766       $40,216       $42,806    $121,788
=======       =======       =======    ========
Fiscal year 1997
Net revenues.......................................   $44,423       $44,932       $38,853    $128,208
=======       =======       =======    ========
Fiscal year 1996
Net revenues.......................................   $21,894       $68,446       $29,600    $119,940
=======       =======       =======    ========

During the years ended January 1, 1999, December 31, 1997 and December 31,
1996, sales to two major customers (three major customers for year ended January
1, 1999) totaled $47.3 million, 38.0 million and $26.4 million, respectively.

Dedicated services generally consist of regularly scheduled, routed
merchandising services performed for a specific retailer or manufacturer by a
dedicated organization. The merchandisers and management team work exclusively
for that retailer or manufacturer. These services are normally provided under
multi-year contracts.

Shared services consist of regularly scheduled, routed merchandising
services provided at the stores for multiple manufacturers, primarily under
multi-year contracts. Shared services may include activities such as ensuring
that client's products authorized for distribution are in stock and on the
shelf, adding in new products that are approved for distribution but not present
on the shelf, setting category shelves in accordance with approved store
schematics, ensuring that shelf tags are in place, checking for the overall
salability of clients' products and selling new product and promotional items.

Project services consist primarily of specific in-store services initiated
by retailers and manufacturers, such as new product launches, special seasonal
or promotional merchandising, focused product support, and product recalls.
These services are used typically for large-scale implementations over 30 days.
The Company also performs other project services, such as new store sets and
existing store resets, re-merchandising, remodels and category implementations,
under shared service contracts or stand-alone project contracts.

14. SUBSEQUENT EVENT

On February 28, 1999, the Company signed a definitive agreement with the
SPAR Group to merge in a stock transaction involving the issuance of PIA stock
to the shareholders of the SPAR Group. The transaction is subject to shareholder
and regulatory approval. After the merger, SPAR Group shareholders will control
PIA. The merger agreement currently provides that either party may terminate the
agreement, subject to certain conditions, if the merger is not consummated on or
before June 30, 1999.

F-17

157

PIA MERCHANDISING SERVICES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)

ASSETS

JANUARY 1,    APRIL 2,
1999         1999
----------    --------

CURRENT ASSETS:
Cash and cash equivalents...................................   $ 11,064     $  7,408
Accounts receivable, net of allowance for doubtful accounts
and other of $821 and $701 for January 1 and April 2,1999,
respectively..............................................     11,222       11,356
Prepaid expenses and other current assets...................        793          691
--------     --------
TOTAL CURRENT ASSETS..............................     23,079       19,455
PROPERTY AND EQUIPMENT, NET (NOTE 3)........................      1,991        1,771
--------     --------
INVESTMENTS AND OTHER ASSETS:
Investment in affiliate.....................................        553          570
Other assets................................................        431          369
--------     --------
TOTAL INVESTMENTS AND OTHER ASSETS................        984          939
--------     --------
TOTAL ASSETS......................................   $ 26,054     $ 22,165
========     ========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
Accounts payable............................................   $  1,194     $    996
Other current liabilities...................................      8,041        7,662
Line of Credit (note 5).....................................         --        2,000
--------     --------
TOTAL CURRENT LIABILITIES.........................      9,235       10,658
LINE OF CREDIT & LONG-TERM LIABILITIES (NOTE 5).............      2,095           90
--------     --------
TOTAL LIABILITIES.................................     11,330       10,748
--------     --------
STOCKHOLDERS' EQUITY:
Common stock and additional paid-in-capital.................     33,800       30,804
Accumulated deficit.........................................    (16,072)     (19,387)
Less treasury stock at cost.................................     (3,004)          --
--------     --------
TOTAL STOCKHOLDERS' EQUITY........................     14,724       11,417
--------     --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY........   $ 26,054     $ 22,165
========     ========

See accompanying notes.
F-18

158

PIA MERCHANDISING SERVICES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE QUARTER ENDED APRIL 3, 1998 AND APRIL 2, 1999
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)

QUARTER ENDED
--------------------
APRIL 3,    APRIL 2,
1998        1999
--------    --------

NET REVENUES................................................  $34,739     $21,626
-------     -------
Operating Expenses:
Field service costs.......................................   29,789      20,069
Selling expenses..........................................    2,279       1,555
General and administrative expenses.......................    3,548       3,110
Depreciation and amortization.............................      282         282
-------     -------
Total operating expenses..........................   35,898      25,016
-------     -------
OPERATING LOSS..............................................   (1,159)     (3,390)
Other income, net...........................................      148          90
-------     -------
Loss Before Provision for Income Taxes......................   (1,011)     (3,300)
Provision for Income Taxes..................................      (12)        (15)
-------     -------
NET LOSS....................................................  $(1,023)    $(3,315)
=======     =======
BASIC AND DILUTED EARNINGS PER SHARE........................  $ (0.19)    $ (0.61)
=======     =======
BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES............    5,393       5,478
=======     =======

See accompanying notes.
F-19

159

PIA MERCHANDISING SERVICES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE QUARTER ENDED APRIL 3, 1998, AND APRIL 2, 1999
(UNAUDITED)
(IN THOUSANDS)

QUARTER ENDED
--------------------
APRIL 3,    APRIL 2,
1998        1999
--------    --------

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss....................................................  $(1,023)    $(3,315)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation and amortization..........................      282         282
Provision for doubtful receivables & other, net........      694          15
Equity in earnings of affiliate........................      (20)        (20)
Changes in operating assets and liabilities:
Accounts receivable....................................   (3,416)       (149)
Prepaid expenses and other.............................    2,691         164
Accounts payable and other liabilities.................   (3,718)       (582)
-------     -------
Net cash used in operating activities..................   (4,510)     (3,605)
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures......................................     (188)        (59)
-------     -------
Net cash used in investing activities..................     (188)        (59)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock, net.................       15           8
-------     -------
Net cash provided by financing activities..............       15           8
NET DECREASE IN CASH AND
CASH EQUIVALENTS..........................................   (4,683)     (3,656)
CASH AND CASH EQUIVALENTS,
Beginning of period.......................................   12,987      11,064
-------     -------
End of period.............................................  $ 8,304     $ 7,408
=======     =======
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for income taxes..................................  $    10     $    95
=======     =======
Cash paid for interest......................................  $    --     $    50
=======     =======

See accompanying notes.
F-20

160

PIA MERCHANDISING SERVICES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

1. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and Article
10 of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. This financial information should be read in conjunction with the
consolidated financial statements and notes thereto for the year ended January
1, 1999, included in the Company's Annual Report on Form 10-K/A for the year
ended January 1, 1999. The results of operations for the interim periods are not
necessarily indicative of the operating results for the year.

Certain amounts have been reclassified in the prior years' consolidated
financial statements in order to conform to the current year's presentation.

2. CHANGE IN ACCOUNTING PERIODS

Effective January 1, 1998, the Company changed its accounting period for
financial statement purposes from a calendar year to a 52/53-week fiscal year.
Beginning with fiscal year 1998, the Company's fiscal year ends on the Friday
closest to December 31. Interim fiscal quarters end on the Friday closest to the
calendar quarter end. The Company does not believe that this change has a
material impact on the financial statements.

3. PROPERTY AND EQUIPMENT

Property and equipment consist of the following (in thousands):

JANUARY 1,    APRIL 2,
1999         1999
----------    --------

Equipment...................................................   $ 3,873      $ 3,932
Furniture and fixtures......................................       719          720
Leasehold improvements......................................       165          165
Capitalized software development costs......................     1,076        1,076
-------      -------
5,833        5,893
Less: Accumulated depreciation and amortization.............    (3,842)      (4,122)
-------      -------
$ 1,991      $ 1,771
=======      =======

4. RECENT ACCOUNTING PRONOUNCEMENTS

Comprehensive Income -- The Company has adopted SFAS No. 130, Reporting
Comprehensive Income. For the quarter ended April 3, 1998 and April 2, 1999, the
Company has no reported differences between net income (loss) and comprehensive
income (loss). Therefore, statements of comprehensive income (loss) have not
been presented.

Disclosure About Segments of an Enterprise and Related Information -- The
Company has adopted SFAS No. 131, Disclosure About Segments of an Enterprise and
Related Information. In accordance with SFAS No. 131, the Company has disclosed
in Note 7 certain information about the Company's products and major customers.

New Accounting Pronouncements -- In the quarter ended April 2, 1999, the
Company adopted SFAS No. 133, Accounting for Derivative Instruments and Hedging
Activities. SFAS No. 133 requires the Company to record all derivatives on the
balance sheet at fair value. The Company does not currently engage in hedging
activities.

F-21

161
PIA MERCHANDISING SERVICES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

5. LINE OF CREDIT

On December 10, 1998, the Company entered a long-term revolving line of
credit agreement with a bank to provide an asset-based credit facility with
maximum borrowing up to $20.0 million. Under this agreement, the line is to
expire on December 7, 2001. All revolving credit loans bear interest at the
agent bank's prime rate plus 0.25% (7.75% at April 2, 1999, or 8.0%), or the
London Interbank Offered Rate ("LIBOR") plus 2.75% (4.94% at April 2, 1999, or
7.69%) at the Company's option. As of April 2, 1999, the outstanding balance on
the line of credit was $2,000,000. The Company's available borrowing is the sum
of 80% of all eligible accounts receivable, plus 100% of eligible cash
collateral less outstanding revolving credit loan.

Under the terms of the long-term debt agreement, the Company is subject to
certain financial covenants. Key covenants require the Company to maintain a
minimum current ratio, total liabilities to tangible net worth ratio, tangible
net worth, working capital, and net income. At April 2, 1999, the Company did
not comply with the tangible net worth covenant and a forbearance to the
agreement was granted by the bank. The Company anticipates that it will not be
in compliance with future covenants and that bank forbearances will be
requested. As of April 2, 1999, the line of credit has been reclassified to
current liabilities, and available borrowings were $4,636,000.

6. RESTRUCTURING AND OTHER CHARGES

During 1997, the Company experienced declining gross margins and resultant
operating losses, due to service performance issues and the loss of several
shared clients. This decline in margins has resulted in insufficient margin
dollars to cover the overhead structure, which had developed at the field level
and in the general corporate area. In the quarter ended September 30, 1997, the
Company addressed these conditions by restructuring its operations, focusing on
a more disciplined and functional operational structure, and redirecting its
technology strategies, resulting in a $5,420,000 charge for restructuring and
other charges. The restructuring charges consist of $1,522,000 identified
severance of corporate and field employees and lease costs in various management
and administrative functions. The restructuring charges also include $2,121,000
in the write downs and accruals associated with the abandonment of certain
internally developed software and specialized computer equipment under long-term
operating leases due to a redirection of the Company's technology strategies.
Other charges consisted primarily of $1,297,000 of reserves and write offs
related to unprofitable contracts, and $480,000 of other costs associated with
implementing and communicating the restructure program. At April 2, 1999,
$237,000 remains in accrued liabilities in the accompanying consolidated balance
sheet consisting of specialized computer equipment under long-term operating
leases no longer in use.

The following table displays a rollforward of the liabilities for
restructuring and other charges from initial recording to April 2, 1999 (in
thousands):

INITIAL
RESTRUCTURING     1997 AND     JANUARY 1,                  APRIL 2,
AND OTHER         1998          1999          1999         1999
TYPE OF COST                  CHARGES       DEDUCTIONS     BALANCE      DEDUCTIONS    BALANCE
------------               -------------    ----------    ----------    ----------    --------

Employee Separation..................     $1,372         $(1,354)        $ 18         $ (18)        $ --
Facility Closing.....................        150            (150)
Technology writedown and related
operating leases...................      2,121          (1,711)         410          (173)         237
Unprofitable Contracts...............      1,297          (1,297)
Other................................        480            (480)
------         -------         ----         -----         ----
$5,420         $(4,992)        $428         $(191)        $237
======         =======         ====         =====         ====

Management believes that the remaining reserves for restructuring are
adequate to complete its plan.

F-22

162
PIA MERCHANDISING SERVICES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

7. SEGMENTS

The Company's primary line of business is merchandising and sales services.
The Company does not have separate segment (service line) managers or discrete
financial information for its three primary lines of services. Therefore,
management considers its merchandising and sales services a single operating
segment. The information reported in the following table includes revenues for
the Company's three primary merchandising and sales service line (in thousands):

During the quarters ended April 2, 1999 and April 3, 1998, sales to two
major customers totaled $7.2 million and $9.3 million, respectively.

BUSINESS SEGMENTS
--------------------------------------------------
DEDICATED    SHARED SERVICE    PROJECTS     TOTAL
---------    --------------    --------    -------

First Quarter 1999
Net revenues..................................   $ 5,761        $ 8,284        $ 7,581     $21,626
=======        =======        =======     =======
First Quarter 1998
Net revenues..................................   $10,292        $12,017        $12,430     $34,739
=======        =======        =======     =======

Dedicated services generally consist of regularly scheduled, routed
merchandising services performed for a specific retailer or manufacturer by a
dedicated organization. The merchandisers and management team work exclusively
for that retailer or manufacturer. These services are normally provided under
multi-year contracts.

Shared services consist of regularly scheduled, routed merchandising
services provided at the stores for multiple manufacturers, primarily under
multi-year contracts. Shared services may include activities such as ensuring
that client's products authorized for distribution are in stock and on the
shelf, adding in new products that are approved for distribution but not present
on the shelf, setting category shelves in accordance with approved store
schematics, ensuring that shelf tags are in place, checking for the overall
salability of clients' products and selling new product and promotional items.

Project services consist primarily of specific in-store services initiated
by retailers and manufacturers, such as new product launches, special seasonal
or promotional merchandising, focused product support and product recalls. These
services are used typically for large-scale implementations over 30 days. The
Company also performs other project services, such as new store sets and
existing store resets, re-merchandising, remodels and category implementations,
under shared service contracts or stand-alone project contracts.

F-23

163

REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS

To the Board of Directors and Stockholders of
SPAR Companies

We have audited the accompanying combined balance sheets of SPAR Companies
as of March 31, 1997 and 1998 and December 31, 1998 and the related combined
statements of operations, stockholders' equity and cash flows for each of the
three years in the period ended March 31, 1998 and the nine month period ended
December 31, 1998. These combined financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
combined financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the combined financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the combined financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the combined financial statements referred to above present
fairly, in all material respects, the financial position of SPAR Companies at
March 31, 1997 and 1998 and December 31, 1998, and the combined results of its
operations and its cash flows for each of the three years in the period ended
March 31, 1998 and the nine month period ended December 31, 1998 in conformity
with generally accepted accounting principles.

/s/ Ernst & Young LLP

Minneapolis, Minnesota
May 19, 1999

F-24

164

SPAR COMPANIES

COMBINED BALANCE SHEETS

ASSETS

MARCH 31,
-------------------------    DECEMBER 31,     MARCH 31,
1997          1998            1998           1999
----------    -----------    ------------    -----------
(UNAUDITED)

Current assets:
Cash.................................  $  519,604    $ 1,919,076    $   909,971     $ 1,980,677
Accounts receivable, less allowance
$321,000 and $568,000 and $605,000
at March 31, 1997 and 1998 and
December 31, 1998, respectively...   7,565,421      8,049,491     10,627,098      14,608,996
Prepaid expenses and other current
assets............................      98,080        310,277        707,684         811,686
Prepaid program costs................          --             --             --       2,569,757
Due from stockholder.................          --             --      1,500,000              --
Due from affiliates..................     132,181         60,000             --         177,120
----------    -----------    -----------     -----------
Total current assets.........   8,315,286     10,338,844     13,744,753      20,148,236
Property and equipment, net............     218,470        226,961        827,332       1,552,213
Goodwill, net..........................          --             --             --      12,140,067
Other assets...........................     334,577        330,124        292,558         301,581
----------    -----------    -----------     -----------
Total assets.................  $8,868,333    $10,895,929    $14,864,643     $34,142,097
==========    ===========    ===========     ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Line of credit.......................  $2,054,962    $ 2,400,990    $ 4,149,403     $ 3,187,179
Accounts payable.....................     879,255        630,250      1,533,675       2,045,648
Accrued expenses.....................   2,321,007      1,755,020      2,808,357       4,900,614
Due to affiliate.....................     618,086        262,271        205,219         355,413
Deferred revenue.....................     466,919             --             --       4,086,457
Distributions payable to
stockholders......................          --      1,203,000      6,577,000       7,399,111
Current portion of long-term debt due
to affiliates.....................     155,959        375,000        375,000              --
Note payable to MCI..................          --             --             --       8,790,386
Current portion of other long-term
debt..............................     500,000        300,000        310,000       1,375,991
----------    -----------    -----------     -----------
Total current liabilities....   6,996,188      6,926,531     15,958,654      32,140,799
Long-term debt due to affiliates, less
current portion......................     402,374        592,500        311,250              --
Other long-term debt, less current
portion..............................     535,000        235,000             --       2,338,260
Stockholders' equity (deficit).........     934,771      3,141,898     (1,405,261)       (336,962)
----------    -----------    -----------     -----------
Total liabilities and
stockholders' equity.......  $8,868,333    $10,895,929    $14,864,643     $34,142,097
==========    ===========    ===========     ===========

See accompanying notes.
F-25

165

SPAR COMPANIES

COMBINED STATEMENTS OF OPERATIONS

NINE MONTHS ENDED          THREE MONTHS ENDED
YEAR ENDED MARCH 31,                   DECEMBER 31,                  MARCH 31,
---------------------------------------   -------------------------   -------------------------
1996          1997          1998          1997          1998          1998          1999
-----------   -----------   -----------   -----------   -----------   -----------   -----------
(UNAUDITED)                 (UNAUDITED)   (UNAUDITED)

Net revenues.............  $14,424,502   $35,574,316   $36,804,398   $27,202,398   $32,600,786   $9,602,000    $21,636,548
Cost of revenues.........    7,678,650    21,753,915    19,417,492    14,579,492    16,216,559    4,838,000     14,372,765
-----------   -----------   -----------   -----------   -----------   ----------    -----------
Gross profit.............    6,745,852    13,820,401    17,386,906    12,622,906    16,384,227    4,764,000      7,263,783
Selling, general and
administrative
expenses...............    7,029,830    13,476,964    12,248,137     9,310,137    10,120,118    2,938,000      4,950,644
-----------   -----------   -----------   -----------   -----------   ----------    -----------
Operating (loss)
income.................     (283,978)      343,437     5,138,769     3,312,769     6,264,109    1,826,000      2,313,139
Other income (expense):
Other income
(expense)............           --      (252,746)      (36,354)      (36,354)      148,832           --         45,032
Interest income........       23,085            --            --            --            --           --             --
Interest expense.......     (122,523)     (513,658)     (353,363)     (258,363)     (304,004)     (95,000)      (415,809)
-----------   -----------   -----------   -----------   -----------   ----------    -----------
(99,438)     (766,404)     (389,717)     (294,717)     (155,172)     (95,000)      (370,777)
-----------   -----------   -----------   -----------   -----------   ----------    -----------
Net (loss) income........  $  (383,416)  $  (422,967)  $ 4,749,052   $ 3,018,052   $ 6,108,937   $1,731,000    $ 1,942,362
===========   ===========   ===========   ===========   ===========   ==========    ===========
Unaudited pro forma
information:
Net (loss) income
before income tax
provision............  $  (383,416)  $  (422,967)  $ 4,749,052   $ 3,018,052   $ 6,108,937   $1,731,000    $ 1,942,362
Pro forma income tax
(benefit)
provision............     (132,493)       (6,350)    1,751,101     1,112,836     2,252,526      638,265        716,200
-----------   -----------   -----------   -----------   -----------   ----------    -----------
Pro forma net (loss)
income (see Note
2)...................  $  (250,923)  $  (416,617)  $ 2,997,951   $ 1,905,216   $ 3,856,411   $1,092,735    $ 1,226,162
===========   ===========   ===========   ===========   ===========   ==========    ===========

See accompanying notes.
F-26

166

SPAR COMPANIES

COMBINED STATEMENT OF STOCKHOLDERS' EQUITY

TOTAL
STOCKHOLDERS'
EQUITY
-------------

Balance at March 31, 1995...................................  $    512,472
Net loss..................................................      (383,416)
Net contributions from stockholders.......................       887,678
------------
Balance at March 31, 1996...................................     1,016,734
Net income................................................      (422,967)
Net contributions from stockholders.......................       341,004
------------
Balance at March 31, 1997...................................       934,771
Net income................................................     4,749,052
Net distributions to stockholders.........................    (2,541,925)
------------
Balance at March 31, 1998...................................     3,141,898
Net income................................................     6,108,937
Net distributions to stockholders.........................   (10,656,096)
------------
Balance at December 31, 1998................................  $ (1,405,261)
Net income (unaudited)....................................     1,942,362
Net distributions to stockholders (unaudited).............      (874,063)
------------
Balance at March 31, 1999 (unaudited).......................  $   (336,962)
============

See accompanying notes.
F-27

167

SPAR COMPANIES

COMBINED STATEMENTS OF CASH FLOWS

NINE MONTHS ENDED          THREE MONTHS ENDED
YEAR ENDED MARCH 31,                   DECEMBER 31,                  MARCH 31
---------------------------------------   -------------------------   -------------------------
1996          1997          1998          1997          1998          1998          1999
-----------   -----------   -----------   -----------   -----------   -----------   -----------
(UNAUDITED)                 (UNAUDITED)   (UNAUDITED)

OPERATING ACTIVITIES
Net (loss) income...............  $  (383,416)  $  (422,967)  $ 4,749,052   $ 3,018,052   $ 6,108,937   $ 1,731,000   $ 1,942,362
Adjustments to reconcile net
(loss) income to net cash
provided by operating
activities:
Loss on disposal of property
and equipment.............           --       228,533            --            --            --            --            --
Depreciation................      157,121       186,012       151,816       112,000       130,696            --        66,292
Amortization................       33,729        41,455         9,376         7,200        11,250            --       178,671
Changes in operating assets
and liabilities:
Accounts receivable.......      201,315       102,616      (484,070)   (3,016,918)   (2,577,607)    2,532,648    (2,284,301)
Note receivable...........     (253,000)      253,000            --            --            --            --            --
Prepaid expenses and other
current assets..........       32,993      (168,451)     (217,120)       (4,622)     (371,091)     (203,122)      603,366
Prepaid program cost......           --            --            --            --            --            --      (195,124)
Due from affiliates.......     (429,481)      582,357        72,181        89,830        60,000       (17,649)     (177,120)
Accounts payable..........      311,306        67,037      (249,005)      (23,866)      903,425      (225,139)      511,973
Accrued expenses..........      268,667     1,216,401      (565,987)     (541,260)    1,053,337       (24,727)    2,092,257
Due to affiliates.........      181,237       436,849      (355,815)      (87,654)      (57,052)     (268,161)      150,194
Deferred revenue..........       46,020       420,899      (466,919)     (245,675)           --      (221,244)   (3,668,767)
-----------   -----------   -----------   -----------   -----------   -----------   -----------
Net cash provided by (used in)
operating activities..........      166,491     2,943,741     2,643,509      (692,913)    5,261,895     3,303,806      (780,197)
INVESTING ACTIVITIES
Purchases of property and
equipment.....................      (91,217)     (104,845)     (160,307)      (71,335)     (731,067)      (56,356)     (279,840)
Purchase of business, net of
cash acquired.................   (4,669,717)           --            --            --            --                     738,240
-----------   -----------   -----------   -----------   -----------   -----------   -----------
Net cash used in investing
activities....................   (4,760,934)     (104,845)     (160,307)      (71,335)     (731,067)      (56,356)      458,400
FINANCING ACTIVITIES
Net (payments of) proceeds from
line of credit................  $ 3,523,734   $(2,498,772)  $   346,028   $ 2,128,508   $ 1,748,413   $(1,782,480)  $  (962,224)
Net (payments of) proceeds from
long-term debt due to Spar
Marketing Services, Inc.......     (249,999)     (145,835)      409,167       505,417      (281,250)      (96,250)     (686,250)
Due to (from) stockholders......      300,000            --    (1,297,000)     (432,750)   (1,500,000)    1,635,750     2,322,111
Payments of note payable to
MCI...........................           --            --            --            --            --            --    (1,625,340)
Payment of other long-term
debt..........................           --      (675,000)     (500,000)     (375,000)     (225,000)     (125,000)           --
Contributions by (distributions
to) stockholders..............      887,678       341,004       (41,925)     (589,680)   (5,282,096)   (1,952,245)     (874,063)
-----------   -----------   -----------   -----------   -----------   -----------   -----------
Proceeds from other long-term
debt..........................           --            --            --            --            --            --     3,218,269
Net cash provided by (used in)
financing activities..........    4,461,413    (2,978,603)   (1,083,730)    1,236,495    (5,539,933)   (2,320,225)    1,392,503
-----------   -----------   -----------   -----------   -----------   -----------   -----------
Net (decrease) increase in
cash..........................     (133,030)     (139,707)    1,399,472       472,247    (1,009,105)      927,225     1,070,706
Cash at beginning of year.......      792,341       659,311       519,604       519,604     1,919,076       991,851       909,971
-----------   -----------   -----------   -----------   -----------   -----------   -----------
Cash at end of year.............  $   659,311   $   519,604   $ 1,919,076   $   991,851   $   909,971   $ 1,919,076   $ 1,980,677
===========   ===========   ===========   ===========   ===========   ===========   ===========
SUPPLEMENTAL DISCLOSURE OF CASH
FLOW INFORMATION
Interest paid...................  $   122,523   $   513,658   $   353,363   $   266,051   $   300,204   $    87,312   $   280,809
===========   ===========   ===========   ===========   ===========   ===========   ===========
Non-cash transactions:
Distributions payable to
stockholders................  $        --   $        --   $ 2,500,000   $        --   $ 6,577,000   $        --   $ 2,500,000
===========   ===========   ===========   ===========   ===========   ===========   ===========

See accompanying notes.
F-28

168

SPAR COMPANIES

NOTES TO COMBINED FINANCIAL STATEMENTS
MARCH 31, 1998

1. BUSINESS AND ORGANIZATION

The SPAR Companies ("SPAR" or the "Company") is a national marketing
services company that provides retail merchandising and other marketing services
to home video, consumer goods and food products companies, SPAR's services
include in-store merchandising, test market research, mystery shopping, database
management and data collection. SPAR offers these services directly through a
network of in-store merchandising specialists. SPAR also provides teleservices
within an extensive inbound and outbound call center.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

CHANGE OF FISCAL YEAR END

Effective April 1, 1998, the SPAR Companies changed their year end to
December 31.

BASIS OF PRESENTATION

The combined financial statements include the following operating companies
owned by the same two stockholders. The companies included in the SPAR Companies
are:

Spar, Inc. ("SINC") (formerly Spar/Burgoyne Information Services,
Inc.) -- provides merchandising services to manufacturers and
distributors, across most retail trade classes such as mass merchandise,
food, drug and home centers.

Spar/Burgoyne Retail Services, Inc. ("SBRS") -- provides information
gathering and consumer and trade research services and operates
nationwide product retrieval service, performing and conducting consumer
and trade surveys.

Spar Marketing Force, Inc. ("SMF") -- provides merchandising services to
manufacturers and distributors, across most retail trade classes such as
mass merchandise, food, drug and home centers. Spar Marketing Force,
Inc. also provides services for an international automobile
manufacturer.

Spar Marketing, Inc. (Nevada, "SMNEV") -- provides merchandising
services to manufacturers and distributors, across most retail trade
classes such as mass merchandise, food, drug and home centers.

Spar Acquisition, Inc. ("SAI") -- a holding company formed in
contemplation of a proposed reorganization. The Company will own SIM,
STM and SMID after completion of the proposed reorganization.

Spar MCI Performance Group, Inc. ("SMCI") -- the wholly-owned subsidiary
of SIM that purchased the assets of Dallas-based MCI Performance Group
on January 15, 1999.

Spar Marketing, Inc. (Delaware "SMI") -- a holding Company formed in
contemplation of a proposed reorganization. The Company will own SI,
SBRS, SMF and SMIN after completion of the proposed reorganization.

Unaudited additional companies, newly formed in 1999 and included in March
31, 1999 combined financial results:

Spar Incentives Marketing, Inc. ("SIM") -- a holding Company formed in
February 1999 in contemplation of a proposed reorganization. The Company
will own SMCI after completion of the proposed reorganization.

Spar Trademarks, Inc. ("STM") -- a newly formed corporation in February
1999 to hold the trademarks of the SPAR Companies.

F-29

169
SPAR COMPANIES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 1998

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
REVENUE RECOGNITION

Revenues are recognized as services are performed in accordance with
contract terms. All operating expenses are charged to operations as incurred.

AGENCY FUNDS

Cash balances available for the administration of a customer's bonus
program are deposited in accounts with financial institutions in which the
Company acts as agent for a customer pending payment settlement. These funds are
considered neither an asset nor liability of the Company. The balance of funds
held in agency accounts totaled approximately $612,000, $997,000 and $35,264,000
as of March 31, 1997 and 1998 and December 31, 1998, respectively.

PROPERTY AND EQUIPMENT

Property and equipment, including leasehold improvements, are stated at
cost. Depreciation and amortization is calculated on a straight-line basis over
estimated useful lives of the related assets, which range from five to seven
years. Leasehold improvements are amortized over the shorter of their estimated
useful lives or lease term, using the straight-line method.

IMPAIRMENT OF LONG-LIVED ASSETS

The Company reviews the recoverability of long-lived assets, whenever
events or changes in circumstances indicate that the carrying amounts may not be
recoverable, in accordance with criteria established by Statement of Financial
Accounting Standards No. 121, "Accounting for the Impairment of Long-Lived
Assets." A loss is recognized for the difference between the carrying amount and
the estimated fair value of the asset. The Company made no adjustment to the
carrying values of the assets during the years ended March 31, 1996, 1997 and
1998 and the nine month period ended December 31, 1998.

FAIR VALUE OF FINANCIAL INSTRUMENTS

At March 31, 1997 and 1998 and December 31, 1998, the fair value of the
Company's cash, accounts receivable, and accounts payable approximates carrying
amounts due to the short-term maturities of such instruments. The carrying
amount of notes payable approximates fair value since the current effective
rates reflect the market rate for debt with similar terms and remaining
maturities.

CONCENTRATION OF CREDIT RISK AND OTHER RISKS

Financial instruments which potentially subject the Company to
concentrations of credit risk consist primarily of cash and accounts receivable.
The Company places its cash with high credit quality financial institutions and
investment grade short-term investments, which limit the amount of credit
exposure.

Three customers approximated 38% and 51% of net revenues for the years
ended March 31, 1997 and 1998, respectively and 50% for the nine month period
ended December 31, 1998. Additionally, three customers approximated 37%, 49% and
50% of accounts receivable at March 31, 1997 and 1998 and December 31, 1998,
respectively.

INCOME TAXES

Historically, the companies in the SPAR Companies have elected, by the
consent of its stockholders, to be taxed under the provisions of subchapter S of
the Internal Revenue Code (the "Code") with the exception of Spar/Burgoyne
Retail Services, Inc. which is taxed as a C corporation. Under the provisions of
the Code, the stockholders of the subchapter S companies include the Company's
corporate income in their personal
F-30

170
SPAR COMPANIES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 1998

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
income tax returns. Accordingly, these subchapter S companies were not subject
to federal corporate income tax during the period for which they were S
Corporations. Certain states in which these subchapter S companies do business
do not accept certain provisions under subchapter S of the Code and, as a
result, income taxes in these states are a direct responsibility of the Company.
Spar/Burgoyne Retail Services, Inc. did not recognize income tax expense for the
year ended March 31, 1996 as the Company had net operating loss carryforwards to
offset any tax liability. In the years ended March 31, 1997 and 1998 and the
nine months ended December 31, 1998, Spar/Burgoyne Retail Services, Inc.
recognized an income tax provision of approximately $52,000, $12,000 and $-0-,
respectively. This expense is recorded in other expenses.

The unaudited pro forma income tax information included in the statements
of operations is presented in accordance with Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes," as if the Company had been
subject to federal and state income taxes for the all periods presented.

USE OF ESTIMATES

The preparation of the combined financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the combined
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates.

INTERNAL USE SOFTWARE DEVELOPMENT COSTS

In March 1998, the AICPA issued SOP 98-1, Accounting For the Costs of
Computer Software Developed For or Obtained For Internal Use, (the "SOP"). The
SOP is effective for the Company beginning on January 1, 1999. The SOP will
require the capitalization of certain costs incurred after the date of adoption
in connection with developing or obtaining software for internal use. The
Company currently expenses such costs as incurred. The Company has not yet
assessed what the impact of the SOP will be on the Company's financial position
or results of operations.

3. PROPERTY AND EQUIPMENT

Property and equipment consists of the following:

MARCH 31
--------------------    DECEMBER 31,
1997        1998          1998
--------    --------    ------------

Computer equipment and programs..................  $320,924    $399,310     $  987,650
Furniture and equipment..........................    38,212      38,212        124,540
Leasehold improvements...........................    30,752          --         73,901
--------    --------     ----------
389,888     437,522      1,186,091
Less accumulated depreciation....................   171,418     210,561        358,759
--------    --------     ----------
$218,470    $226,961     $  827,332
========    ========     ==========

4. LINE OF CREDIT

Spar Marketing Force, Inc. ("SMF") has a line of credit with a bank,
wherein SMF can borrow up to $6,000,000 based on eligible accounts receivable.
Borrowings under the line of credit are due on demand with interest payable at
the bank's "alternate base rate" plus 2.0% (9.75% at December 31, 1998). The
balance outstanding on the line of credit was $2,054,962, $2,400,990 and
$1,519,161 at March 31, 1997 and 1998 and December 31, 1998, respectively. The
line of credit is secured by the assets of SMF.

F-31

171
SPAR COMPANIES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 1998

5. LONG-TERM DEBT DUE TO AFFILIATE

The Company's affiliate, Spar Marketing Service, Inc. ("SMS"), had a
long-term loan dated August 1994 with an original balance of $1,000,000 and a
line of credit in the amount of $500,000. SMS refinanced and replaced these
loans with a single facility, long-term loan, on October 29, 1996. The
replacement term loan in the amount of $1,500,000 was due in 48 consecutive
monthly principal installments of $31,250 and interest at the bank's fluctuating
announced rate plus 1.25%. The Company has borrowed these same funds from SMS
and has agreed to repay the amounts borrowed using the same terms contained
within the loan agreement between the bank and SMS. The bank loan was repaid in
its entirety by the SPAR Companies in 1998.

6. COMMON STOCK

Common stock of the companies included in the SPAR Companies at December
31, 1998 is as follows:

SHARES
SHARES      ISSUED AND
AUTHORIZED    OUTSTANDING    PAR VALUE
----------    -----------    ---------

Spar Inc.........................................       2,500        72           None
Spar/Burgoyne Retail Services, Inc...............       2,500        72           None
Spar Marketing Force, Inc........................       2,500        72           None
Spar Marketing, Inc..............................         100        72           None
Spar Acquisition, Inc............................  50,000,000        72           $.01
Spar MCI Performance Group, Inc..................       2,500        72           None
Spar Marketing, Inc. (Delaware)..................       1,000        72           $.01

7. COMMITMENTS AND CONTINGENCIES

LEASE COMMITMENTS

The Company leases equipment and certain office space in several cities,
under non-cancelable operating lease agreements. Certain leases contain
escalation clauses and require the Company to pay its share of any increases in
operating expenses and real estate taxes. Rent expense was approximately
$331,000, $816,000 and $871,000 for the years ended March 31, 1996, 1997 and
1998, respectively, and $754,000 for the nine months ended December 31, 1998. At
December 31, 1998, future minimum commitments under all non-cancelable operating
lease arrangements are as follows:

1999.....................................  $  854,500
2000.....................................     185,500
2001.....................................     170,200
2002.....................................     135,400
2003.....................................      67,700
----------
$1,413,300
==========

LEGAL MATTERS

SMS, a related party, has been audited by the Internal Revenue Service with
respect to whether certain field representatives should be classified as
independent contractors or employees for federal employment tax purposes for the
tax years ended December 31, 1991 and 1992. The dispute has worked its way
through the Internal Revenue Service appeals process and SMS intends to file a
petition with the Federal District Court. If it is found that the field
representatives should be classified as employees, SMS could be liable for
employment taxes and related penalties and interest. The outcome of this dispute
and the amount of the contingent liability are not determinable at this time. If
a liability is assessed and SMS is unable to pay, the

F-32

172
SPAR COMPANIES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 1998

7. COMMITMENTS AND CONTINGENCIES (CONTINUED)
IRS may seek to collect all or a portion of the tax liability from the Company
due to its common control and business relationship with SMS. Accordingly, the
Company believes an adequate provision for the contingent liability has been
made in the accompanying combined financial statements as of March 31, 1997 and
1998 and December 31, 1998, respectively. Similar claims have been filed against
SMS by certain states. However, SMS is confident defending its position against
these state claims because of prior success in several states, and SMS will
continue to vigorously defend its position against any future state claims that
may arise. For example, SMS prevailed on a similar claim by the state of
California, which had instituted administrative proceedings against SMS. The
administrative law judge agreed with SMS's classification of field
representatives as independent contractors. The State of California has declined
to file a further appeal and has refunded payments made by SMS under protest
during the appeal process.

The Company is a party to various legal actions and administrative
proceedings arising in the normal course of business. In the opinion of
Company's management, dispositions of these matters are not anticipated to have
a material adverse effect on the financial position, results of operations or
cash flows of the Company.

8. PROFIT SHARING PLAN

The SPAR Companies have a 401(k) Profit Sharing Plan covering substantially
all full-time employees. Employer contributions of approximately $31,200,
$31,600 and $37,000 were made to the plan during the years ended March 31, 1996,
1997 and 1998, respectively, and $14,400 for the nine months ended December 31,
1998.

9. PHANTOM STOCK PLAN

The SPAR Companies have a phantom stock plan covering certain members of
management. Phantom shares are granted at the discretion of the Board of
Directors and vest over four years. The Company has accrued approximately
$110,000 related to the phantom stock plan as of December 31, 1998. All
liabilities under the plan are subordinated to bank debt.

10. ACCRUED EXPENSES

The accrued expense balance includes approximately $950,000, $600,000 and
$1,867,000 for salaries and bonus amounts payable at March 31, 1997 and 1998 and
December 31, 1998, respectively.

11. RELATED PARTY TRANSACTIONS

The SPAR Companies are affiliated through common ownership with Spar Retail
Services, Inc. (formerly Spar/Servco, Inc.), Spar Marketing Services, Inc.,
Spar/Burgoyne, Inc., Spar Group, Inc., IDS Spar Pty, Ltd. (Aust.), Spar Ltd.,
(U.K.), Garden Island, Inc., Spar Marketing Pty Ltd. (Aust.), Spar/ Burgoyne
Information Services, Inc., WR Services, Inc., Spar Services Inc., Infinity
Insurance Ltd. and Spar Infotech, Inc.

F-33

173
SPAR COMPANIES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 1998

11. RELATED PARTY TRANSACTIONS (CONTINUED)
The following transactions occurred between the SPAR Companies and the
above affiliates:

NINE MONTHS
YEAR ENDED MARCH 31,              ENDED
------------------------------------   DECEMBER 31,
1996         1997         1998          1998
----------   ----------   ----------   ------------

Marketing services provided by
affiliates:
Independent contractor services...  $4,077,621   $6,250,321   $3,232,500    2,763,222
==========   ==========   ==========    =========
Field management services.........  $1,820,000   $3,002,905   $2,964,246    2,049,172
==========   ==========   ==========    =========
Services provided to affiliates:
Management services...............  $  620,000   $  597,509   $  576,147      417,403
==========   ==========   ==========    =========

Through the services of Infinity Insurance, Ltd., the Company purchased
insurance coverage for its casualty and property insurance risk, for
approximately $321,000 and $318,000 during the years ended March 31, 1997 and
1998, respectively, and $375,000 for the nine months ended December 31, 1998. No
services were provided during the year ended March 31, 1996.

MARCH 31,
------------------------------   DECEMBER 31,
1996       1997       1998         1998
--------   --------   --------   ------------

Balance due from affiliates:
Spar Marketing Services, Inc...........  $113,538   $     --   $ 60,000     $     --
Spar Group, Inc........................   600,000    132,181         --           --
--------   --------   --------     --------
$713,538   $132,181   $ 60,000     $     --
========   ========   ========     ========
Balance due to affiliates:
Spar Marketing Services, Inc...........  $     --   $576,820   $261,771     $205,219
Spar/Burgoyne, Inc.....................        --         --        500           --
Spar Group, Inc........................    39,500     41,266         --           --
Spar/Burgoyne Information Services,
Inc.................................   185,824         --         --           --
--------   --------   --------     --------
$225,324   $618,086   $262,271     $205,219
========   ========   ========     ========

12. ACQUISITION

SPAR Marketing Force, Inc. was organized in late fiscal 1996 to acquire
substantially all of the assets of Marketing Force, Inc. The March 1, 1996
acquisition has been accounted for by the purchase method of accounting.
Accordingly, the purchase price was allocated to the net assets acquired based
on their estimated fair values. The fair value of tangible assets acquired and
liabilities assumed was $7,950,033 and $2,950,033, respectively. The purchase
consisted of (a) $5,000,000 in cash, financed through a revolving bank credit
line and security agreement, and (b) a subordinated promissory note not to
exceed $12,000,000 payable to Marketing Force, Inc. and its affiliate, ADVO,
Inc.

The purchase agreement provided for a post closing adjustment to the
purchase price in the event of a deficiency in the closing business values. The
final assessment of net asset values has resulted in a restructuring of the
subordinated promissory note up to $3,000,000 which is payable only in the event
that SPAR Marketing Force, Inc. completes a public offering of its shares prior
to the year 2000. The consideration related to the subordinated promissory note
will be recorded as additional purchase price when paid.

F-34

174
SPAR COMPANIES

NOTES TO COMBINED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 1998

13. EVENTS (UNAUDITED) SUBSEQUENT TO DATE OF INDEPENDENT AUDITORS' REPORT

MCI PERFORMANCE GROUP, INC.

On January 15, 1999, SMCI completed the purchase of substantially all of
the assets and assumed certain liabilities of Dallas based, MCI Performance
Group, Inc. (MCI). The transaction, to be accounted for as a purchase, consisted
of $1,800,000 cash and an $12,422,189 note payable to the seller. The excess
purchase price over the fair value of the net assets acquired has been allocated
to goodwill. The operations of SMCI from January 15, 1999 have been included in
the Spar Companies' results of operations for the three months ended March 31,
1999. The purchase agreement provides for post closing adjustments whereby the
seller has guaranteed a minimum net worth of $1,500,000 for MCI at the date of
closing and additional contingent consideration will be payable in the event
that SMCI and MCI achieve $3,500,000 in earnings before taxes for the twelve
month period ending March 31, 1999. Additional consideration paid, if any, will
be recorded as an increase to goodwill.

AMENDED REVOLVING LINE OF CREDIT/SECURITY AGREEMENT

In March 1999, the Company amended its revolving line of credit/security
agreement with its bank, to include a $3,000,000 term loan due in monthly
installments of $83,334 through March, 2002.

PIA MERCHANDISING SERVICES, INC.

In May 1999, the Company entered into an amended Plan of Merger with
Irvine, California based, PIA Merchandising Services, Inc. (PIA). The
transaction, to be accounted for as a reverse merger, will consist of a stock
exchange. Prior to the merger, the Companies in the Spar Companies will be
reorganized as direct or indirect subsidiaries of SPAR Acquisition, Inc. (SAI).
Each share of capital stock of Spar Acquisition, Inc. will be converted into its
right to receive one share of PIA stock and each option to acquire one share of
Spar Acquisition, Inc. stock will be converted into a corresponding right to
acquire one share of PIA stock. Initial converted shares and converted options
(if exercised) will together represent 70% of the outstanding shares of PIA
immediately following the merger. The agreement with PIA is subject to PIA
shareholder approval, and is anticipated to be completed in the second calendar
quarter of 1999.

In connection with the merger agreement, the shareholders of the SPAR
Companies have agreed to indemnify PIA stockholders with respect to the
independent contractor contingent liability discussed in Note 7 and the
subordinated promissory note discussed in Note 12.

The affiliate arrangements as described in Notes 5 and 11 will be amended
upon consummation of the merger discussed above so that all continuing
obligations will be similar to terms and conditions of agreements/arrangements
with unaffiliated third parties.

F-35

175

REPORT OF INDEPENDENT AUDITORS

To the Board of Directors and Stockholder
of MCI Performance Group, Inc.

We have audited the accompanying balance sheets of MCI Performance Group,
Inc. as of December 31, 1997 and 1998 and the related statements of income,
stockholder's equity (deficit) and cash flows for each of the three years in the
period ended December 31, 1998. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of MCI Performance Group, Inc.
at December 31, 1997 and 1998, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 1998 in
conformity with generally accepted accounting principles.

/s/ Ernst & Young LLP

Minneapolis, Minnesota
February 22, 1999

F-36

176

MCI PERFORMANCE GROUP, INC.

BALANCE SHEETS

ASSETS

DECEMBER 31,
-------------------------
1997           1998
-----------    ----------
(RESTATED)

Current assets:
Cash and cash equivalents.................................  $ 3,709,298    $1,194,288
Accounts receivable, less allowance of $162,000 and
$219,000 at December 31, 1997 and 1998, respectively...    3,424,812     1,385,895
Employee advances.........................................      457,404       522,798
Note receivable...........................................           --       750,000
Due from stockholder......................................           --     2,296,272
Prepaid program costs.....................................    1,064,292     1,423,879
Prepaid expenses and other current assets.................      975,595       780,526
-----------    ----------
Total current assets..............................    9,631,401     8,353,658
Property and equipment, net...............................    2,275,717       349,635
Other assets..............................................       14,297        14,225
-----------    ----------
Total assets......................................  $11,921,415    $8,717,518
===========    ==========

LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT)
Current liabilities:
Accounts payable..........................................  $ 4,772,530    $  631,662
Accrued expenses and other current liabilities............    1,819,758     1,402,541
Deferred revenue..........................................    4,438,418     5,558,924
Due to stockholder........................................      460,269     1,530,000
-----------    ----------
Total current liabilities.........................   11,490,975     9,123,127
Long-term debt, less current portion........................    1,219,500            --
Stockholder's equity (deficit) Common stock, $1 par value;
100,000 shares authorized, 3,500 shares issued and
outstanding...............................................        3,500         3,500
Retained earnings (deficit).................................     (792,560)     (409,109)
-----------    ----------
Total stockholder's equity (deficit)..............     (789,060)     (405,609)
-----------    ----------
Total liabilities and stockholder's equity
(deficit).......................................  $11,921,415    $8,717,518
===========    ==========

See accompanying notes.
F-37

177

MCI PERFORMANCE GROUP, INC.

STATEMENTS OF INCOME

YEAR ENDED DECEMBER 31,
-----------------------------------------
1996           1997           1998
-----------    -----------    -----------
(RESTATED)

NET REVENUES................................  $33,361,277    $42,294,074    $33,195,765
Cost of revenues............................   26,351,322     31,722,284     26,107,705
-----------    -----------    -----------
Gross profit................................    7,009,955     10,571,790      7,088,060
OPERATING EXPENSES
Selling, general and administrative
expenses..................................    6,570,962      9,757,239      6,781,306
-----------    -----------    -----------
Operating income............................      438,993        814,551        306,754
OTHER INCOME (EXPENSE)
Interest income (expense), net..............        3,899        (43,374)        76,697
-----------    -----------    -----------
Net income..................................  $   442,892    $   771,177    $   383,451
===========    ===========    ===========
UNAUDITED PRO FORMA INFORMATION
Net income before income tax provision......  $   442,892    $   771,177    $   383,451
Pro forma income tax provision..............           --             --             --
-----------    -----------    -----------
Pro forma net income (See Note 2)...........  $   442,892    $   771,177    $   383,451
===========    ===========    ===========

See accompanying notes.
F-38

178

MCI PERFORMANCE GROUP, INC.

STATEMENTS OF STOCKHOLDER'S EQUITY (DEFICIT)

TOTAL
COMMON STOCK       RETAINED      STOCKHOLDER'S
----------------     EARNINGS         EQUITY
SHARES    AMOUNT     (DEFICIT)       (DEFICIT)
------    ------    -----------    -------------

Balance at December 31, 1995............  3,500     $3,500    $(2,006,629)    $(2,003,129)
Net income............................     --         --        442,892         442,892
-----     ------    -----------     -----------
Balance at December 31, 1996............  3,500      3,500     (1,563,737)     (1,560,237)
Net income (Restated).................     --         --        771,177         771,177
-----     ------    -----------     -----------
Balance at December 31, 1997
(Restated)............................  3,500      3,500       (792,560)       (789,060)
Net income............................     --         --        383,451         383,451
-----     ------    -----------     -----------
Balance at December 31, 1998............  3,500     $3,500    $  (409,109)    $  (405,609)
=====     ======    ===========     ===========

See accompanying notes.
F-39

179

MCI PERFORMANCE GROUP, INC.

STATEMENTS OF CASH FLOWS

YEAR ENDED DECEMBER 31,
-----------------------------------------
1996           1997           1998
-----------    -----------    -----------
(RESTATED)

OPERATING ACTIVITIES
Net income..........................................  $   442,892    $   771,177    $   383,451
Adjustments to reconcile net income (loss) to net
cash provided by (used in) operating activities:
Depreciation...................................      123,577        155,802        497,980
Changes in operating assets and liabilities:
Accounts receivable..........................      611,622     (2,244,377)     2,038,917
Employee advances............................       13,158       (363,144)       (65,395)
Prepaid program costs........................      (77,588)     2,047,996       (359,587)
Prepaid expenses and other current assets....          502       (822,903)       195,142
Accounts payable.............................      732,651      2,400,031     (4,140,868)
Accrued expenses and other current
liabilities...............................      626,481        409,833       (417,217)
Due to/from stockholder......................   (1,555,859)     1,276,654     (1,226,541)
Deferred revenue.............................      575,999     (1,168,272)     1,120,506
-----------    -----------    -----------
Net cash provided by (used in) operating
activities........................................    1,493,435      2,462,797     (1,973,612)

INVESTING ACTIVITIES
Net proceeds from disposal of property and
equipment.........................................           --             --        839,839
Purchases of property and equipment.................      (54,270)    (2,204,277)      (161,737)
-----------    -----------    -----------
Net cash used in investing activities...............      (54,270)    (2,204,277)       678,102

FINANCING ACTIVITIES
Proceeds from note payable..........................           --      1,219,500             --
Payment of note payable.............................      (58,033)            --     (1,219,500)
-----------    -----------    -----------
Net cash (used in) provided by financing
activities........................................      (58,033)     1,219,500     (1,219,500)
-----------    -----------    -----------
Net increase (decrease) in cash and cash
equivalents.......................................    1,381,132      1,478,020     (2,515,010)
Cash and cash equivalents at beginning of period....      850,146      2,231,278      3,709,298
-----------    -----------    -----------
Cash and cash equivalents at end of period..........  $ 2,231,278    $ 3,709,298    $ 1,194,288
===========    ===========    ===========
SUPPLEMENTAL SCHEDULE OF NONCASH FINANCING
ACTIVITIES
Proceeds from sale of the property and equipment
received in the form of a note receivable.........  $        --    $        --    $   750,000
===========    ===========    ===========

See accompanying notes.
F-40

180

MCI PERFORMANCE GROUP, INC.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998

1. BUSINESS AND ORGANIZATION

MCI Performance Group, Inc. ("MCI" or the "Company"), incorporated in Texas
in 1987, specializes in designing and implementing premium incentives and
managing meetings and group travel for clients throughout the United States. MCI
provides a wide variety of consulting, creative, program administration and
travel and merchandise fulfillment services to companies seeking to motivate
employees, salespeople, dealers, distributors, retailers and consumers toward
certain action or objectives.

The Company changed its name from MCI Planners, Inc. to MCI Performance
Group, Inc. effective January 30, 1998.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

REVENUE RECOGNITION

The Company records revenues at the completion of the program. External
direct costs and cash received in advance of the program are deferred until the
program occurs. The programs are short-term in nature, typically one to six
months in duration from contract signing to event occurrence. Generally, a
non-refundable deposit is received from the customer upon contract execution.
The customer is billed periodically during the program preparation and the
remaining amount owed for services is payable upon the completion of the
program. Costs typically incurred in the months prior to the program are labor
costs to develop the program plan and to make necessary reservations and
deposits for facilities, transportation, and other required entertainment
activities. Reimbursable travel expenditures are netted against reimbursable
receipts and are therefore excluded from the statements of operations. Revenues
may vary significantly, from period to period, depending upon the type of
programs and the timing of when programs are completed. If a client cancels a
program after costs have been expensed, the client is billed for work performed
and expenses incurred through the date of cancellation.

The Company has entered into incentive commission program agreements with
certain airlines which provide for incentive payments ("override") based upon
the Company's achievement of stated targets. The override is payable in cash or
airline tickets, at the airline's option, and is recorded as revenue at the time
there is sufficient information, provided by the airline, to relate actual
performance to the targets to determine the amount earned. Override payable in
tickets is recorded at the fair market value of the tickets received. Override
revenue of approximately $440,000, $1,142,000 and $400,000 was recorded during
the years ended December 31, 1996, 1997 and 1998, respectively.

ADVERTISING COSTS

Advertising costs are expensed as incurred.

CASH EQUIVALENTS

The Company considers all highly liquid instruments purchased with
maturities of three months or less to be cash equivalents.

The Company maintains its cash and cash equivalents in bank deposit
accounts which, at times, may exceed federally insured limits. The Company has
not experienced any losses in such accounts.

The Company is required, by the airlines, to maintain a certificate of
deposit to guarantee payment of tickets booked by the Company. At December 31,
1997 and 1998, the Company had placed $77,740 and $81,370, respectively, in a
short-term investment account.

F-41

181

MCI PERFORMANCE GROUP, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1998

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
PROPERTY AND EQUIPMENT

Property and equipment, including leasehold improvements, are stated at
cost. Depreciation and amortization is calculated on a straight-line basis over
estimated useful lives of the related assets, which range from five to seven
years. Leasehold improvements are amortized over the shorter of their estimated
useful lives or lease term, using the straight-line method.

IMPAIRMENT OF LONG-LIVED ASSETS

The Company reviews the recoverability of long-lived assets, whenever
events or changes in circumstances indicate that the carrying amounts may not be
recoverable, in accordance with criteria established by Statement of Financial
Accounting Standards No. 121, "Accounting for the Impairment of Long-Lived
Assets." A loss is recognized for the difference between the carrying amount and
the estimated fair value of the asset. The Company made no adjustment to the
carrying values of the assets during the years ended December 31, 1997 and 1998.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company believes that the carrying amount of its assets and liabilities
reported in the balance sheets approximates fair value.

CONCENTRATION OF CREDIT RISK AND OTHER RISKS

Financial instruments which potentially subject the Company to
concentrations of credit risk consist primarily of cash and cash equivalents and
accounts receivable. The Company places its cash and cash equivalents with high
credit quality financial institutions and investment grade short-term
investments, which limit the amount of credit exposure. For accounts receivable,
the Company does not require collateral; however, the Company monitors its
exposure for credit losses and maintains allowances for anticipated losses.

The Company may also be exposed to risk of loss with respect to credit card
transactions. The Company's risk relates to returned transactions, merchant and
fraud and transmissions of erroneous information. The Company has not incurred
significant losses for these risks to date.

One customer in 1996 and two customers in each of 1997 and 1998 represented
approximately 39%, 39% and 36% of net revenues, respectively.

INCOME TAXES

Historically, the Company has elected, by the consent of its stockholder,
to be taxed under the provisions of Subchapter S of the Internal Revenue Code
(the "Code"). Under the provisions of the Code, the stockholder includes the
Company's corporate income in his personal income tax returns. Accordingly, the
Company was not subject to corporate income tax during periods for which it was
an S Corporation.

The unaudited pro forma income tax information included in the statements
of operations is presented in accordance with Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes," as if the Company had been
subject to federal and state income taxes for all periods presented. There would
be no income tax expense on a pro forma basis for any of the years presented
because of the availability of pro forma net operating loss carrybacks.

USE OF ESTIMATES

The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and

F-42

182

MCI PERFORMANCE GROUP, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1998

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

3. RELATED PARTY TRANSACTIONS

The Company leases office space from a partnership that is owned by the
Company's stockholder. The total amount of rent expense related to this lease
was $450,000, $456,000 and $450,000, during 1996, 1997 and 1998, respectively.

The Company's due to/from stockholder accounts are settled periodically and
are classified as a current asset or liability. Employee advances are also
settled periodically and are classified as a current asset. There are no formal
terms of settlement or interest expense associated with these accounts.

4. PROPERTY AND EQUIPMENT

Property and equipment consists of the following:

DECEMBER 31
--------------------------
1997           1998
-----------    -----------

Furniture and fixtures....................................  $   360,202    $   376,176
Equipment.................................................    1,564,595      1,579,408
Property held under capital leases........................      164,916        164,916
Automobiles...............................................       53,564         20,778
Charter yacht.............................................    1,960,846         25,000
Leasehold improvements....................................      718,582        752,948
-----------    -----------
4,822,705      2,919,226
Less accumulated depreciation and amortization............   (2,546,988)    (2,609,590)
-----------    -----------
$ 2,275,717    $   309,636
===========    ===========

5. LEASE COMMITMENTS

OPERATING LEASES

The Company leases certain facilities under non-cancelable operating lease
agreements. Rent expense, including rent paid to the former stockholder, was
approximately $479,000, 470,000 and $535,000 for the years ended December 31,
1996, 1997 and 1998, respectively. At December 31, 1998, future minimum
commitments under non-cancelable operating lease arrangements are as follows:

1999.......................................  $44,000
2000.......................................   20,000
-------
$64,000
=======

F-43

183

MCI PERFORMANCE GROUP, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1998

5. LEASE COMMITMENTS (CONTINUED)
CAPITAL LEASES

The Company leases certain office and computer equipment under capital
leases. The assets and liabilities under capital leases are recorded at the
lower of the present value of the minimum lease payments or the fair market
value of the assets. Included in property and equipment are the following assets
held under capital leases:

DECEMBER 31,
---------------------
1997        1998
--------    ---------

Computer equipment....................................  $164,916    $ 164,916
Less accumulated depreciation.........................   (91,517)    (131,201)
--------    ---------
$ 73,399    $  33,715
========    =========

6. LONG-TERM DEBT

Long-term debt consisted of the following:

DECEMBER 31,
------------------
1997       1998
----------    ----

Note payable to bank in monthly installments at 8.5%
interest, collateralized by a charter yacht. The yacht
was sold in 1998.......................................  $1,261,580     $--
Less current portion.....................................     (42,080)    --
----------     --
Long-term debt, less current portion.....................  $1,219,500     $--
==========     ==

7. EMPLOYEES' SAVINGS PLAN

Employees become eligible after attaining the age 20 1/2 years and having
been employed by the Company for six months. Employees may contribute up to 25%
of their annual compensation subject to limitations set forth in the Internal
Revenue Code. Employees' contributions vest immediately. The Company maintains a
401(k) plan under which the Company may contribute 25% of an employee's eligible
contributions up to the first 5% of annual compensation. The matching
contribution vests 20% after 3 years and in increments of 20% each additional
year. The Company's contributions for the years ended December 31, 1996, 1997
and 1998 were $12,576, $63,704 and $17,361, respectively.

8. CONTINGENCIES

LEGAL

The Company is a party to the various legal actions and administrative
proceedings arising in the normal course of business. In the opinion of
Company's management, dispositions of these matters are not anticipated to have
a material adverse effect on the financial position, results of operations or
cash flows of the Company.

9. YEAR 2000 READINESS DISCLOSURE (UNAUDITED)

The Company has conducted an assessment of its computer systems to identify
the systems that could be affected by the "Year 2000" issue. The problem results
from computer programs having been written to define the applicable year using
two digits rather than four digits. The Company believes, with modifications to
existing software, the Year 2000 issue will not pose significant operational
problems for its computer systems. The Company plans to complete any Year 2000
modifications by December 31, 1999. At present, the Company anticipates the
total costs to complete the Year 2000 project will be minimal. Further, the
Company is confident its planning efforts are adequate to ensure there are no
adverse effects on the Company's core business operations and that the
transactions with business partners are fully supported.

F-44

184

MCI PERFORMANCE GROUP, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1998

10. SUBSEQUENT EVENT

SALE OF BUSINESS

On January 15, 1999, the Company completed the sale of substantially all of
the assets and certain liabilities to SPAR MCI Performance Group, Inc. The
transaction consisted of $1,800,000 cash and an $12,422,189 note receivable from
the buyer. The sale agreement provides for post closing adjustments whereby the
Company has guaranteed a minimum net worth of $1,500,000 for the Company at the
date of closing and additional contingent consideration will be receivable in
the event that the Company achieves $3,500,000 earning before taxes for the
twelve month period ending March 31, 1999.

The affiliate arrangements as described in Note 3 have been amended upon
consummation of the asset sale discussed above so that all continuing
obligations will be similar to terms and conditions of agreements/arrangements
with unaffiliated third parties.

11. RESTATEMENT

The Company has restated its 1997 financial statements to reflect costs
related to programs completed in 1997. The restatement resulted in an $841,000
reduction of previously reported net income, an $841,000 increase to accrued
expenses and a corresponding decrease to shareholders' equity.

F-45

185

ANNEX A

AGREEMENT
AND
PLAN OF MERGER
AMONG
PIA MERCHANDISING SERVICES, INC.,
SG ACQUISITION, INC.,
PIA MERCHANDISING CO., INC.,
SPAR ACQUISITION, INC.,
SPAR MARKETING INC., A DELAWARE CORPORATION,
SPAR MARKETING FORCE, INC.,
SPAR MARKETING, INC., A NEVADA CORPORATION,
SPAR, INC.,
SPAR/BURGOYNE RETAIL SERVICES, INC.,
SPAR INCENTIVE MARKETING, INC.,
SPAR MCI PERFORMANCE GROUP, INC.
AND

SPAR TRADEMARKS, INC.

DATED AS OF FEBRUARY 28, 1999
AND AS AMENDED ON MAY 14, 1999

186

TABLE OF CONTENTS

ARTICLE I

THE MERGER

PAGE
----

SECTION 1.01.    The Merger..................................................     3
SECTION 1.02.    Closing; Effective Time of the Merger.......................     3
SECTION 1.03.    Name, Certificate of Incorporation, Bylaws, Board of
Directors and Officers of the Surviving Corporation.........     3
SECTION 1.04.    Effects of the Merger.......................................     3
SECTION 1.05.    Tax Consequences............................................     4
SECTION 1.06.    Further Assurances..........................................     4
ARTICLE II
MERGER CONSIDERATION
SECTION 2.01.    Conversion of Capital Stock, Etc. ..........................     4
SECTION 2.02.    Exchange Procedures.........................................     4
SECTION 2.03.    No Fractional Shares........................................     4
SECTION 2.04.    SAI Option Assumption and Exchange..........................     4
SECTION 2.05.    Granting of New Stock Options under the PIA Stock Option
Plan........................................................     5
SECTION 2.06.    Reservation and Registration of Option Shares...............     5
SECTION 2.07.    Transfer Taxes..............................................     5
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SPAR PARTIES
SECTION 3.01.    Corporate Existence.........................................     6
SECTION 3.02.    Authorization and Enforceability............................     6
SECTION 3.03.    Capital Stock of the SPAR Parties...........................     7
SECTION 3.04.    No Violations...............................................     7
SECTION 3.05.    Financial Statements........................................     8
SECTION 3.06.    Permits.....................................................     9
SECTION 3.07.    Real and Personal Property..................................     9
SECTION 3.08.    Contracts and Commitments...................................     9
SECTION 3.09.    Insurance...................................................    10
SECTION 3.10.    Employees...................................................    10
SECTION 3.11.    Employee Benefit Plans and Arrangements.....................    11
SECTION 3.12.    Compliance with Law.........................................    13
SECTION 3.13.    Transactions With Affiliates................................    13
SECTION 3.14.    Litigation..................................................    13
SECTION 3.15.    Taxes.......................................................    13
SECTION 3.16.    Intellectual Property Matters...............................    14
SECTION 3.17.    Existing Condition..........................................    15
SECTION 3.18.    Books of Account............................................    16
SECTION 3.19.    Environmental Matters.......................................    17
SECTION 3.20.    No Illegal Payments.........................................    18

ii

187

PAGE
----

SECTION 3.21.    Brokers.....................................................    18
SECTION 3.22.    No Misrepresentation by the SPAR Marketing Companies........    18
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PIA PARTIES
SECTION 4.01.    Corporate Existence.........................................    18
SECTION 4.02.    Authorization and Enforceability............................    19
SECTION 4.03.    Capital Stock of the PIA Parties............................    19
SECTION 4.04.    No Violations...............................................    20
SECTION 4.05.    Financial Statements........................................    20
SECTION 4.06.    Permits.....................................................    21
SECTION 4.07.    Real and Personal Property..................................    21
SECTION 4.08.    Contracts and Commitments...................................    21
SECTION 4.09.    Insurance...................................................    22
SECTION 4.10.    Employees...................................................    22
SECTION 4.11.    Employee Benefit Plans and Arrangements.....................    22
SECTION 4.12.    Compliance with Law.........................................    24
SECTION 4.13.    Transactions With Affiliates................................    25
SECTION 4.14.    Litigation..................................................    25
SECTION 4.15.    Taxes.......................................................    25
SECTION 4.16.    Intellectual Property Matters...............................    26
SECTION 4.17.    Existing Condition..........................................    26
SECTION 4.18.    Books of Account............................................    27
SECTION 4.19.    Environmental Matters.......................................    27
SECTION 4.20.    No Illegal Payments.........................................    28
SECTION 4.21.    Brokers.....................................................    28
SECTION 4.22.    SEC Filings.................................................    28
SECTION 4.23.    No Misrepresentation by the PIA Parties.....................    28
SECTION 4.24.    Board Action; Opinion of Financial Advisor..................    28
ARTICLE V
COVENANTS
SECTION 5.01.    PIA Proxy Statement; Stockholders Meeting...................    29
SECTION 5.02.    Conduct Prior to the Closing Date...........................    29
SECTION 5.03.    Consummation of the SPAR Reorganization Transactions; SPAR
Stockholder Action..........................................    30
SECTION 5.04.    Access......................................................    30
SECTION 5.05.    Negotiations................................................    30
SECTION 5.06.    Press Releases and Other Communications.....................    31
SECTION 5.07.    Third Party Approvals.......................................    31
SECTION 5.08.    Notice to Bargaining Agents.................................    31
SECTION 5.09.    Notification of Certain Matters.............................    31
SECTION 5.10.    Closing Net Worth...........................................    31
SECTION 5.11.    Post Merger Indemnification of Officers and Directors by
Parties.....................................................    31
SECTION 5.12.    Further Assurances..........................................    32
ARTICLE VI
CONDITIONS PRECEDENT
SECTION 6.01.    Conditions to Each Party's Obligations......................    32

iii

188

PAGE
----

SECTION 6.02.    Conditions Precedent to the Obligations of the SPAR
Parties.....................................................    33
SECTION 6.03.    Conditions Precedent to the Obligations of the PIA
Parties.....................................................    34
ARTICLE VII
CLOSING NET WORTH; NONSURVIVAL OF REPRESENTATIONS
SECTION 7.01.    SPAR Closing Net Worth......................................    35
SECTION 7.02.    Survival of Representations and Warranties..................    36
ARTICLE VIII
TERMINATION OF AGREEMENT
SECTION 8.01.    Termination.................................................    36
SECTION 8.02.    Effect of Termination.......................................    37
SECTION 8.03.    Breakup Fee.................................................    37
ARTICLE IX
GENERAL
SECTION 9.01.    Successors and Assigns; Assignment..........................    38
SECTION 9.02.    No Third Party Rights.......................................    38
SECTION 9.03.    Counterparts................................................    38
SECTION 9.04.    Expenses....................................................    38
SECTION 9.05.    Notices.....................................................    38
SECTION 9.06.    Governing Law...............................................    39
SECTION 9.07.    Consent to Jurisdiction, Etc. ..............................    39
SECTION 9.08.    Waiver of Jury Trial........................................    40
SECTION 9.09.    Exercise of Rights and Remedies.............................    40
SECTION 9.10.    Reformation and Severability................................    40
SECTION 9.11.    Remedies Cumulative.........................................    40
SECTION 9.12.    Captions....................................................    40
SECTION 9.13.    Amendments..................................................    40
SECTION 9.14.    Entire Agreement............................................    40

EXHIBITS:
---------

A           Articles of Merger..........................................  A-1
B           Special Purpose Stock Option Plan...........................  B-1
C           Trademark License Agreement.................................  C-1
D           Business Manager Agreement..................................  D-1
E           Certificate of Amendment of Certificate of Incorporation of
PIA Merchandising Services, Inc. ...........................  E-1
E-1         Form of Reverse Split Amendment to PIA Delaware Certificate
of Incorporation............................................  E-2
F           Amended and Restated 1995 Stock Option Plan.................  F-1
G           Limited Indemnification Agreement...........................  G-1
H           Indemnity Escrow Agreement..................................  H-1

iv

189

AGREEMENT AND PLAN OF MERGER

This Agreement and Plan of Merger, dated as of February 28, 1999 (as the
same may be supplemented, modified, amended, restated or replaced from time to
time in the manner provided herein, this "Agreement"), is made by and among PIA
Merchandising Services, Inc., a Delaware corporation ("PIA Delaware"), SG
Acquisition, Inc., a Nevada corporation ("PIA Acquisition"), PIA Merchandising
Co., Inc., a California corporation ("PIA California"), SPAR Acquisition, Inc.,
a Nevada corporation ("SAI"), SPAR Marketing, Inc., a Delaware corporation
("SMI"), SPAR Marketing Force, Inc., a Nevada corporation ("SMF"), SPAR
Marketing, Inc., a Nevada corporation ("SMNEV"), SPAR, Inc., a Nevada
corporation ("SINC"), SPAR/Burgoyne Retail Services, Inc., an Ohio corporation
("SBRS"), SPAR Incentive Marketing, Inc., a Delaware corporation ("SIM"), SPAR
MCI Performance Group, Inc., a Delaware corporation ("SMCI"), and SPAR
Trademarks, Inc., a Nevada corporation ("STM"). SMF, SINC and SBRS are sometimes
referred to herein individually as a "SPAR Marketing Company" and collectively
as the "SPAR Marketing Companies". SMI and the SPAR Marketing Companies are
sometimes referred to herein individually as a "SPAR Marketing Party" and
collectively as the "SPAR Marketing Parties". SIM and SMCI are sometimes
referred to herein individually as a "SPAR Incentive Party" and collectively as
the "SPAR Incentive Parties". SAI, STM, the SPAR Marketing Parties and the SPAR
Incentive Companies are sometimes referred to herein individually as a "SPAR
Party" and collectively as the "SPAR Parties". PIA Delaware, PIA Acquisition and
PIA California are sometimes referred to herein individually as a "PIA Party"
and collectively as the "PIA Parties". The PIA Parties and the SPAR Parties are
sometimes referred to herein individually as a "Party" and collectively as the
"Parties".

RECITALS

A. ROBERT G. BROWN and WILLIAM H. BARTELS (each a "SPAR Principal", and
collectively the "SPAR Principals") own a majority of all of the outstanding
shares of common stock of SAI, par value $0.01 per share ("SAI Stock"), and all
of the outstanding capital stock of the other SPAR Parties as of the date
hereof. The SPAR Principals together with other owners of SAI Stock are
sometimes referred to herein individually as a "SPAR Stockholder" and
collectively as the "SPAR Stockholders". Options to acquire shares of common
stock of SAI (each a "SAI Option" and collectively the "SAI Options") will be
held by certain employees of the SPAR Parties, certain others providing services
to the SPAR Parties and certain other persons (each a "SAI Option Holder" and
collectively the "SAI Option Holders") in the aggregate amount and on the terms
described in the SPAR Disclosure Letter.

B. The SPAR Principals also own all of the outstanding shares of capital
stock, and are officers and directors, of: (i) SPAR Marketing Services, Inc., a
Nevada Corporation ("SMS"), which provides certain field services pursuant to
Service Agreement dated as of January 4, 1999 (as the same may be supplemented,
modified, amended, restated or replaced from time to time in the manner provided
therein, the "Field Service Agreement"); (ii) SPAR InfoTech, Inc. ("SIT"), a
startup venture that provides certain programming services to the SPAR Marketing
Parties; and (iii) SPAR Group, Inc. ("SGI"), a Delaware corporation that will
change its name prior to the Effective Time. SMS, SIT, STM, SGI and any other
companies owned by the SPAR Principals (other than the SPAR Parties) and their
respective assets and properties are not part of the proposed merger
transactions.

C. On January 15, 1999, SMCI purchased substantially all of the assets and
assumed certain liabilities (the "MCI Acquisition") of MCI Performance Group,
Inc., a Texas corporation ("MCI"), pursuant to an Asset Purchase Agreement dated
as of December 22, 1998, among MCI, John H. Wile (the "MCI Stockholder") and
SMCI, as amended by a First Amendment dated as of January 15, 1999 (as amended,
and as the same may be supplemented, modified, amended, restated or replaced
from time to time in the manner provided therein, the "MCI Purchase Agreement"),
under which SGI is a guarantor. The MCI Acquisition was financed in part by
SMCI's issuance of its Promissory Note to MCI dated as of January 15, 1999 (as
the same may be supplemented, modified, amended, restated or replaced from time
to time in the manner provided therein, the "MCI Note"), which MCI Note is
secured by the pledge to MCI of all of the stock of SMCI pursuant to the
Hypothecation Agreement from the SPAR Principals dated as of January 15, 1999
(as the same may be supplemented, modified, amended, restated or replaced from
time to time in the manner provided therein, the "MCI Hypothecation"). The MCI
Purchase Agreement contains certain representa-

1

190

tions, warranties and indemnifications of MCI and the MCI Stockholder with
respect to the assets, business and liabilities of MCI acquired by SMCI
thereunder.

D. The SPAR Principals have entered into an agreement with the SPAR Parties
dated as of February 28, 1999 (as the same may be supplemented, modified,
amended, restated or replaced from time to time in the manner provided therein,
the "SPAR Reorganization Agreement"), pursuant to which (i) the SPAR Principals
have agreed to contribute to SAI all of their shares of STM, the SPAR Marketing
Parties and SPAR Incentive Parties in return for the issuance to them of
additional shares of SAI Stock as provided therein, and (ii) SAI would then
contribute the capital stock of SMCI to SIM and the capital stock of the SPAR
Marketing Companies to SMI, such that SAI will be the sole stockholder of STM,
SIM and SMI, SIM will be the sole stockholder of SMCI, and SMI will be the sole
stockholder of the SPAR Marketing Companies. The transactions to be effected
pursuant to the Reorganization Agreement will be referred to as the "SPAR
Reorganization Transactions" and collectively with the MCI Acquisition will be
referred to as the "SPAR Premerger Transactions". The MCI Purchase Agreement,
the MCI Note and related documents and the SPAR Reorganization Agreement may be
referred to individually as a "SPAR Premerger Agreement" and collectively as the
"SPAR Premerger Agreements".

E. Pursuant to the SPAR Reorganization Agreement, SAI will issue to the
SPAR Principals sufficient additional shares of SAI Stock such that (after such
issuance and including shares previously issued to them) they will then together
own shares of SAI Stock equal in number to (i) the product of (A) two and
one-third (2 1/3) times (B) the total number of shares of PIA Delaware Stock (as
hereinafter defined) issued and outstanding as of the close of business on the
Business Day preceding the Closing Date (as defined in the Reorganization
Agreement), minus (ii) the sum of the number of shares of SAI Stock issuable
upon exercise of the SAI Options (without regard to the vesting provisions
thereof) plus shares of SAI Stock owned by stockholders other than the SPAR
Principals.

F. The SPAR Principals and the respective Boards of Directors of the SPAR
Parties have approved the SPAR Premerger Transactions.

G. PIA Acquisition and PIA California each is a direct wholly owned
subsidiary of PIA Delaware.

H. The respective Boards of Directors of the PIA Parties and of the SPAR
Parties deem it advisable and in the best interests of such corporations and
their respective stockholders that, following the consummation of the SPAR
Reorganization Transactions, PIA Acquisition merge with and into SAI (the
"Merger") pursuant to this Agreement and the applicable provisions of the
General Corporation Law of the State of Nevada (the "NGCL"). SAI and PIA
Acquisition are sometimes collectively referred to as the "Constituent
Corporations" and SAI, following the Merger, is sometimes referred to as the
"Surviving Corporation".

I. As provided herein, (i) as a result of the Merger, each outstanding
share of SAI Common Stock will be converted into the right to receive one share
of common stock of PIA Delaware, par value $0.01 per share ("PIA Delaware
Stock"), and (ii) following the Merger, each SAI Option Holder will receive a
Substitute Option (as hereinafter defined) to purchase the same number of shares
of PIA Delaware Stock on the same terms as the number of shares of SAI Stock
that such SAI Option Holder was entitled to purchase under such SAI Option.
Immediately following the Merger, (A) the SPAR Stockholders will hold and the
SAI Option Holders will have the right to acquire upon exercise (without regard
to vesting) shares of PIA Delaware Stock that, in the aggregate, will represent
approximately 70% of the sum of (1) the total number of shares of PIA Delaware
Stock issued and outstanding immediately after the Merger plus (2) the total
number of shares of PIA Delaware Stock issuable upon exercise of the Substitute
Options (without regard to vesting), and (B) the shares of PIA Delaware Stock
held by stockholders of PIA Delaware immediately prior to the Merger will
represent approximately 30% of such post-Merger sum.

J. The respective Boards of Directors of PIA Delaware, PIA Acquisition and
SAI have approved the Merger on the terms and subject to the conditions set
forth herein.

K. The Parties intend the Merger to qualify as a tax-free reorganization
within the meaning of Section 368 of the Internal Revenue Code of 1986, as
amended (the "Code").

2

191

AGREEMENT

In consideration of the foregoing, the mutual covenants and agreements
hereinafter set forth, and other good and valuable consideration (the receipt
and adequacy of which is hereby acknowledged by the Parties), the Parties hereto
hereby agree as follows:

ARTICLE I

THE MERGER

SECTION 1.01. The Merger. Upon the terms and conditions hereinafter set
forth and in accordance with the NGCL, at the Effective Time (as defined in
Section 1.02), PIA Acquisition shall be merged with and into SAI, and thereupon
the separate existence of PIA Acquisition shall cease, and SAI, as the Surviving
Corporation, shall continue to exist under and be governed by the NGCL.

SECTION 1.02. Closing; Effective Time of the Merger. The consummation of
the transactions contemplated by this Agreement (the "Closing") shall take place
at the offices of Parker Chapin Flattau & Klimpl, LLP, in New York, New York, at
10:00 a.m. on a date to be designated by mutual agreement of PIA Delaware and
SAI (the "Closing Date"), which shall be no later than the second business day
after the satisfaction (or, to the extent permitted by law, the waiver) of the
conditions set forth in Article VI. Concurrently with or as soon as practicable
after the Closing, PIA Delaware, PIA Acquisition and SAI will cause the Articles
of Merger in substantially the form of Exhibit A attached hereto (the "Articles
of Merger") to be executed and filed with the Secretary of State of the State of
Nevada as provided in Section 92A.200 of the NGCL. The Merger shall become
effective immediately upon such filing of the Articles of Merger with the
Secretary of State of the State of Nevada or at such other time as PIA
Acquisition and SAI shall agree and specify in the Articles of Merger. The time
of the effectiveness of the Merger is sometimes referred to as the "Effective
Time."

SECTION 1.03. Name, Certificate of Incorporation, Bylaws, Board of
Directors and Officers of the Surviving Corporation. Upon the effectiveness of
the Merger:

(a) the name of the Surviving Corporation shall be "SPAR Acquisition,
Inc."

(b) the Certificate of Incorporation of the Surviving Corporation
shall be the Certificate of Incorporation of SAI until thereafter duly
amended or restated;

(c) the Bylaws of the Surviving Corporation shall be the Bylaws of SAI
until thereafter duly amended or restated;

(d) the directors of SAI shall serve as the directors of the Surviving
Corporation until their respective successors have been duly elected and
qualified; and

(e) the officers of SAI shall serve as the officers of the Surviving
Corporation in the same capacity or capacities until their respective
successors have been duly appointed.

SECTION 1.04. Effects of the Merger. The Merger shall have the effects set
forth in Section 92A.250 of the NGCL. Without in any way limiting such effects,
at and after the Effective Time (a) the Constituent Corporations shall merge and
become and continue as part of a single corporation, SAI, which is the Surviving
Corporation, and (b) the Surviving Corporation shall (to the same extent and
with the same effect as was the case with the applicable Constituent
Corporation): (i) own and possess any and all (A) financial assets, accounts,
documents, instruments, equipment, inventory, intellectual property, contracts,
general intangibles, real property and improvements, and other assets and
properties of each Constituent Corporation, and (B) rights, powers, privileges,
security or other entitlements, licenses, franchises and other interests of each
Constituent Corporation, all of which will be automatically vested in the
Surviving Corporation at the Effective Time (subject to any existing liens or
encumbrances thereon, which shall continue unimpaired), and none of which shall
be impaired or otherwise adversely affected by the Merger; and (ii) be liable
for all of the debts, liabilities, obligations and duties of each Constituent
Corporation, all of which will continue unimpaired and may be enforced against
the Surviving Corporation to the same extent as it would have been enforceable
against the applicable Constituent Corporation.

3

192

SECTION 1.05. Tax Consequences. The Merger is intended to constitute a
reorganization within the meaning of Section 368 of the Code for federal income
tax purposes, and the Parties will take all commercially reasonable steps in
furtherance thereof, including (without limitation) the making of all required
filings and the keeping of all required records. The parties to this Agreement
hereby adopt this Agreement as a "plan of reorganization" within the meaning of
ss.ss.1.368-2(g) and 1.368-3(a) of the United States Treasury Regulations.

SECTION 1.06. Further Assurances. If, at any time after the Effective Time,
the Surviving Corporation shall consider or be advised that any further deeds,
assignments or assurances in law or any other acts are necessary, desirable or
proper to vest, perfect or confirm, of record or otherwise, in the Surviving
Corporation, the title to any property or right of the Constituent Corporations
acquired or to be acquired by reason of, or as a result of, the Merger, or
otherwise to carry out the purposes of this Agreement, the Surviving Corporation
and its proper officers and directors (on behalf of PIA Acquisition or SAI)
shall execute and deliver all such deeds, assignments and assurances in law and
do all acts necessary, desirable or proper to vest, perfect or confirm title to
such property or right in the Surviving Corporation and otherwise to carry out
the purposes of this Agreement, and the proper officers and directors of the
Surviving Corporation are fully authorized to take any and all such action.

ARTICLE II

MERGER CONSIDERATION

SECTION 2.01. Conversion of Capital Stock, Etc. At the Effective Time and
without any further action on the part of the holder thereof:

(a) each share of SAI Stock that is issued and outstanding immediately
prior to the Effective Time shall automatically be converted into the right
to receive one (1) fully paid and nonassessable share of PIA Delaware Stock
(which 1:1 ratio will be referred to as the "Exchange Ratio"); and

(b) each share of common stock of PIA Acquisition, par value $.01 per
share, that is issued and outstanding immediately prior to the Effective
Time shall, by virtue of the Merger and without any action on the part of
PIA Delaware as the holder thereof, be converted into and become one (1)
share of common stock of the Surviving Corporation, par value $.01 per
share.

SECTION 2.02. Exchange Procedures. Following the Effective Time, upon
surrender to PIA Delaware of stock certificates representing outstanding shares
of SAI Stock (the "Certificates"), each holder of SAI Stock shall be entitled to
receive, in exchange therefor, one or more new stock certificates representing,
in the aggregate, that number of whole shares of PIA Delaware Stock which such
holder has the right to receive pursuant to Section 2.01(a) in respect of the
shares of SAI Stock evidenced by the Certificate surrendered, and each
Certificate so surrendered shall forthwith be canceled; provided, however, that
PIA Delaware shall cause ten percent (10%) of the shares which each SPAR
Principal and their Family Members (as hereinafter defined) would otherwise have
had the right to receive pursuant to Section 2.01(a) (the "Share Escrow Amount")
to be registered in the name of, and delivered to, the Indemnity Escrow Agent
(as such term is defined in Section 6.01(g) hereof) to be held in accordance
with the provisions of the Limited Indemnification Agreement and the Indemnity
Escrow Agreement (as such terms are defined in Section 6.01(g) hereof); and
provided further that the Share Escrow Amount may be satisfied by the shares of
the SPAR Principals as opposed to the shares of such Family Members.

SECTION 2.03. No Fractional Shares. Notwithstanding any other provision of
this Article II, no fractional shares of PIA Delaware Stock shall be issued in
connection with the Merger and any holder of SAI Stock entitled hereunder to
receive a fractional share of PIA Delaware Stock but for this Section shall be
entitled to receive from PIA Delaware a cash payment (rounded to the nearest
whole cent) equal to the product of such fraction multiplied by the last sale
price of PIA Delaware Stock as reported on the Nasdaq National Market on the
Closing Date.

SECTION 2.04. SAI Option Assumption and Exchange. As of the Effective Time,
PIA Delaware shall be deemed to have assumed all of the outstanding SAI Options,
in each case on the terms and conditions set forth in the written option
agreements (copies of which have been provided to PIA Delaware). PIA Delaware

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shall issue to each holder of an outstanding SAI Option, against delivery and
cancellation of the agreement evidencing such outstanding SAI Option, a new
substitute option (a "Substitute Option") under PIA Delaware's Special Purpose
Stock Option Plan substantially in the form of Exhibit B hereto, together with
such changes therein as may be made with the approval of the PIA Delaware Board
and SAI (the "PIA Special Purpose Plan"). Each Substitute Option shall entitle
the SAI Option Holder to purchase the same number of shares of PIA Delaware
Stock as the number of shares of SAI Stock that could have been purchased under
the SAI Option (reflecting the 1:1 Exchange Ratio) and shall otherwise be issued
upon the same terms and conditions as set forth in the written agreement
evidencing the SAI Option so surrendered, including (without limitation) the
same per share exercise price and the same vesting (if any) as the surrendered
SAI Option. Each SAI Option so surrendered shall forthwith be canceled.

SECTION 2.05. Granting of New Stock Options under the PIA Stock Option
Plan. Subject to the consummation of the Merger and the approval by the
stockholders of PIA Delaware of the Proposed Plan Amendment (as hereinafter
defined), effective as of the close of business on the date on which the Merger
is consummated, PIA Delaware shall issue, subject to the availability of shares
under PIA Delaware's Amended and Restated 1995 Stock Option Plan (the "PIA Stock
Option Plan"), stock options under the PIA Stock Option Plan (each a "New PIA
Option") to the persons and in the amounts (which may include unallocated
amounts for later allocation by SAI) listed in the letter of even date herewith
delivered to PIA Delaware (the "New Option Schedule") or in the terms of the
agreement governing such options, which stock options shall cover an aggregate
of 2,133,744 shares of PIA Delaware Stock). Except as otherwise indicated on the
New Option Schedule or in the terms of the agreements governing such options,
each New PIA Option shall (i) vest (become exercisable) in four equal annual
installments, (ii) have an exercise price equal to the last sale price for the
PIA Delaware Stock as reported on the Nasdaq National Market on the date of
issuance and (iii) have such other terms and conditions consistent with the PIA
Stock Option Plan as the Board of Directors of PIA Delaware may determine. The
New Option Schedule may be amended by SAI (by written notice to PIA Delaware) at
any time prior to the issuance of the affected New PIA Options to add or delete
names or to increase or decrease the number of shares to be covered by any
unissued proposed New PIA Option; provided, however, that the aggregate number
of shares of PIA Delaware Stock issuable upon exercise of all New PIA Options
(without regard to the vesting provisions thereof) shall not exceed 2,133,744
shares without the prior written consent of PIA Delaware; and provided further
that the terms and conditions of any New PIA Option indicated on the New Option
Schedule as of the date hereof may not be materially improved (other than a
reallocation of shares or allocation of previously unallocated shares to any
employee or other recipient permitted under the PIA Stock Plan) without the
prior written consent of PIA Delaware.

SECTION 2.06. Reservation and Registration of Option Shares. PIA Delaware
shall take all corporate action necessary to reserve for issuance a sufficient
number of shares of PIA Delaware Stock for delivery upon exercise of the
Substitute Options and the New PIA Options. As soon as practicable after the
Effective Time, to the extent such form is available therefor, PIA Delaware
shall file a registration statement on Form S-8 (or any successor form) with
respect to the shares of PIA Delaware Stock subject to the Substitute Options
and the New PIA Options (and any other PIA Options that the PIA Board may wish
to treat similarly). PIA Delaware shall use commercially reasonable efforts to
maintain the effectiveness of such registration statement(s) so long as any
options covered thereby remain outstanding and unexercised.

SECTION 2.07. Transfer Taxes. PIA Delaware shall pay any and all transfer
taxes incurred in connection the Merger and the stock and option issuances and
other transactions contemplated hereunder.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE SPAR PARTIES

Except as otherwise disclosed in that certain letter of even date herewith
delivered to PIA Delaware prior to the execution hereof (which letter shall
contain appropriate references and cross references to identify the

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Sections hereof to which the information in such letter relates) (the "SPAR
Disclosure Letter"), each SPAR Party, jointly and severally, represents and
warrants to the PIA Parties as follows:

SECTION 3.01. Corporate Existence. Except as otherwise set forth in the
SPAR Disclosure Letter:

(a) Each SPAR Party is a corporation duly organized, validly existing
and in good standing under the laws of its state of incorporation. Each
SPAR Party is duly qualified to conduct business and is in good standing as
a foreign corporation in each jurisdiction in which the conduct of its
business requires it to be so qualified, except where the failure to be so
qualified would not have a material adverse effect on the business,
operations, properties, assets or financial condition of the SPAR Parties
taken as a whole (a "SPAR Material Adverse Effect").

(b) As of the date hereof, neither SAI, SIM nor SMI has any assets or
liabilities or has conducted any business operations except in anticipation
of and in connection with the SPAR Reorganization Transactions and the
other transactions contemplated by the SPAR Reorganization Agreement and
this Agreement.

(c) As of the date of this Agreement, no SPAR Party has any subsidiary
or owns, of record or beneficially, or controls, directly or indirectly,
any other capital stock, any securities convertible into capital stock or
any other equity interest in any corporation, association or other business
entity or is, directly or indirectly, a participant in any joint venture,
partnership or other non-corporate entity. However, the Parties acknowledge
and understand that immediately prior to the Effective Time, upon the terms
and subject to the conditions set forth in the Reorganization Agreement,
the Reorganization Transactions described in the Recitals hereto will
occur.

(d) The SPAR Disclosure Letter sets forth a list of (i) the names of
all predecessor companies of each SPAR Marketing Company, (ii) the names of
all entities from which any SPAR Party previously acquired any significant
assets, and (iii) all sales (other than in the ordinary course of business)
and spinoffs of significant assets by any SPAR Marketing Company since
March 31, 1996.

SECTION 3.02. Authorization and Enforceability. Except as otherwise set
forth in the SPAR Disclosure Letter:

(a) Each SPAR Party has the corporate power, authority and legal right
to execute, deliver and perform (i) the SPAR Reorganization Agreement, (ii)
this Agreement, and (iii) to the extent a party thereto (A) the Business
Manager Agreement to be delivered pursuant to Section 6.01(f)(i) hereof,
(B) the Trademark License Agreements to be delivered pursuant to Section
6.01(f)(ii) hereof, (C) the Limited Indemnification Agreement and the
Indemnity Escrow Agreement to be delivered pursuant to Section 6.01(g)
hereof, and (D) the releases from SPAR Principals to be delivered pursuant
to Section 6.03(g) (together with the SPAR Reorganization Agreement and
this Agreement, each a "Merger Document" and collectively the "Merger
Documents"). The execution, delivery and performance of the SPAR
Reorganization Agreement, this Agreement and the other Merger Documents by
each SPAR Party (to the extent it is a party thereto) have been duly
authorized by all necessary corporate action and no further corporate
action on the part of any SPAR Party is necessary to authorize the SPAR
Premerger Agreements to which it is a party or this Agreement or any other
Merger Document to which it is a party or the performance of the
transactions contemplated hereby or thereby.

(b) The SPAR Premerger Agreements and this Agreement (i) have been
duly executed and delivered on behalf of each SPAR Party (to the extent it
is a party thereto) and (ii) constitute legal, valid and binding
obligations of such SPAR Party, enforceable in accordance with their
respective terms, except as may be limited by (A) applicable bankruptcy,
insolvency, fraudulent conveyance or transfer, reorganization or other laws
affecting any rights, powers, privileges, remedies and interests of
creditors generally, (B) rules or principles of equity or public policy
affecting the enforcement of obligations generally, whether at law, in
equity or otherwise, including (without limitation) those pertaining to
materiality, reasonableness, unconscionability, impossibility of
performance, redemption or other cure, surety rights or defenses, waiver,
latches, estoppel, or judicial deference, or (C) discretionary powers of
any court or other authority before which may be brought any proceeding
seeking equitable or other remedies, in each case whether at law, in equity
or otherwise (the "Bankruptcy Exceptions").

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SECTION 3.03. Capital Stock of the SPAR Parties. Except as otherwise set
forth in the SPAR Disclosure Letter:

(a) As of the date of this Agreement, the authorized SAI Stock
consists of 50,000,000 shares of capital stock of SAI, which may be issued
as either common or preferred stock. The SPAR Disclosure Letter sets forth
(i) the issued and outstanding capital stock of SAI as of the date of this
Agreement and (ii) the names of each proposed SAI Option Holder and the
number of shares of SAI Stock purchasable pursuant to their respective SAI
Options as of the date hereof. The PIA Parties acknowledge and agree that
the schedule of SAI Options may be amended by SAI (by written notice to PIA
Delaware) to add or delete names or to increase or decrease the number of
shares to be covered by any proposed SAI Option at any time prior to (1)
the mailing of the PIA Proxy Statement in the case of any individual whose
present or future holdings of shares of PIA Delaware Stock or options to
acquire such shares are disclosed in the PIA Proxy Statement, or (2) the
Effective Time in the case of any other person. Each of the SAI Options
will be evidenced by a written option agreement, copies of which have been
provided to PIA Delaware. The SPAR Disclosure Letter sets forth the
authorized and the issued and outstanding capital stock of each other SPAR
Party as of the date of this Agreement. As of the date of this Agreement,
all of the issued and outstanding shares of the capital stock of each SPAR
Party are owned beneficially and of record by the SPAR Stockholders in the
case of SAI and by the SPAR Principals in the case of all other SPAR
Parties, free and clear of all Restrictions (as hereinafter defined), and
have been validly issued and are fully paid and nonassessable.
"Restrictions" shall mean any and all material liens, security interests,
pledges, charges, voting trusts, equities, restrictions, encumbrances and
claims of every kind, except for (A) restrictions on sale or resale under
the Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder (as the same may be supplemented, modified, amended,
restated or replaced from time to time, the "Securities Act"), or state
securities laws, (B) in the case of the SMCI shares, the pledge of the SMCI
shares pursuant to the MCI Hypothecation, and (C) in the case of the SPAR
Parties that certain Agreement dated December 14, 1992, by and between
Robert G. Brown, William H. Bartels and Donald R. Young as escrow agent (as
amended, the "Buy-Sell Agreement").

(b) Upon the consummation of the SPAR Reorganization Transactions upon
the terms and subject to the conditions set forth in the Reorganization
Agreement, (i) the outstanding shares of SAI Stock will be equal to the
number described in the Recitals, above, and will have been validly issued
and will be fully paid and nonassessable, (ii) the SPAR Stockholders will
own beneficially and of record all of the shares of capital stock of SAI in
the amounts indicated in the SPAR Disclosure Letter, free and clear of all
Restrictions, (iii) SAI will acquire all of the capital stock of the SPAR
Marketing Companies and the SPAR Incentive Companies (subject to the pledge
of the SMCI shares pursuant to the MCI Hypothecation), (iv) SIM will
acquire all of the capital stock of SMCI (subject to the pledge of the SMCI
shares pursuant to the MCI Hypothecation), and (v) SMI will acquire all of
the capital stock of the SPAR Marketing Companies.

(c) Other than the proposed SAI Options or in connection with the SPAR
Reorganization Transactions or this Agreement, as of the date hereof: (i)
there are no outstanding rights, subscriptions, warrants, calls,
convertible securities, unsatisfied preemptive rights, options or other
agreements of any kind pursuant to which any SPAR Party is required to
issue any of its authorized but unissued capital stock; and (ii) no SPAR
Party has any obligation (contingent or otherwise) to purchase, redeem or
otherwise acquire any outstanding shares of capital stock or to pay any
dividend or make any distribution in respect thereof.

SECTION 3.04. No Violations. Except as otherwise set forth in the SPAR
Disclosure Letter:

(a) The execution, delivery and performance of the SPAR Premerger
Agreements and this Agreement by each SPAR Party (to the extent it is a
party thereto) do not and will not violate or result in the breach of any
term, condition or provision of, or require the consent of any other person
under, (i) any existing applicable law, ordinance, or governmental rule or
regulation ("Applicable Law") to which any SPAR Party or any SPAR Principal
is subject, (ii) any judgment, order, writ, injunction, decree or award of
any Governmental Entity (as defined in Section 3.04(d) hereof) that is
applicable to any SPAR Party or any SPAR Principal (each a "SPAR Court
Order"), (iii) the charter documents of any SPAR Party, or (iv) any SPAR
Contract (as defined in Section 3.08), SPAR Realty Lease (as defined in

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Section 3.07(a)), material SPAR Personalty Lease (as defined in Section
3.07(b)) or other material mortgage, indenture, agreement, contract,
commitment, lease, permit, plan, authorization, instrument or document to
which any SPAR Marketing Company or any SPAR Principal is a party, by which
any SPAR Marketing Company or any SPAR Principal has any rights or by which
any of the properties or assets of any SPAR Marketing Company is bound or
subject (each a "Material SPAR Document").

(b) The execution, delivery and performance of the SPAR Premerger
Agreements and this Agreement by each SPAR Marketing Company (to the extent
it is a party thereto) will not be reasonably likely to result in (A) any
termination, cancellation or acceleration of any Material SPAR Document or
(B) termination, modification or other change in any material respect of
the existing rights and obligations of any SPAR Marketing Company under
such Material SPAR Document.

(c) No SPAR Marketing Company, and to the knowledge of each SPAR
Marketing Company, no other party thereto, is in default in any material
respect under any Material SPAR Document, and to the knowledge of each SPAR
Marketing Company, no event has occurred that with the giving of notice or
lapse of time (or both) would constitute such a default.

(d) Other than the filing of a pre-merger notification report under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and
the rules and regulations promulgated thereunder (the "HSR Act") and in
connection with or in compliance with the provisions of the Securities
Exchange Act of 1934, as amended, and the rules and regulations promulgated
thereunder (as the same may be supplemented, modified, amended, restated or
replaced from time to time, the "Exchange Act"), and the Securities Act, no
authorization, approval or consent of, and no registration or filing with,
any Governmental Entity is required in connection with the execution and
delivery of the SPAR Premerger Agreements or this Agreement by any SPAR
Party or any SPAR Principal and the performance of the transactions
contemplated hereunder and thereunder. As used herein, the term
"Governmental Entity" means any court, administrative or regulatory agency
or commission, or other governmental authority or instrumentality,
domestic, foreign or supranational.

SECTION 3.05. Financial Statements. Except as otherwise set forth in the
SPAR Disclosure Letter:

(a) The SPAR Parties have delivered to PIA Delaware copies of (i) the
combined balance sheets of the SPAR Marketing Companies at March 31, 1998
(the "Audited SPAR Marketing Balance Sheet Date"), and March 31, 1997, and
the related combined statements of income, cash flows and changes in
stockholders' equity for the fiscal years then ended, together with the
report of Ernst & Young, LLP thereon (the "Audited SPAR Marketing Financial
Statements"); (ii) the unaudited (but reviewed) combined balance sheets of
the SPAR Marketing Companies at December 31, 1998 (the "Interim SPAR
Marketing Balance Sheet Date"), and the related combined statements of
income and cash flows for the nine month period then ended (the "Interim
SPAR Marketing Financial Statements" and together with the Audited SPAR
Marketing Financial Statements, the "SPAR Marketing Financial Statements");
and (iii) the balance sheets of MCI at December 31, 1998 (the "Audited MCI
Balance Sheet Date"), and December 31, 1997, and the related combined
statements of income, cash flows and changes in stockholders' equity for
the fiscal years then ended, together with the report of Ernst & Young, LLP
thereon (the "Audited MCI Financial Statements"), in each case adjusted to
exclude the MCI assets not acquired by SMCI and the other pro forma
adjustments contemplated by the MCI Purchase Agreement. The SPAR Marketing
Financial Statements have been prepared in accordance with generally
accepted accounting principles ("GAAP") consistently applied throughout the
periods involved and fairly present the combined financial position and the
combined results of operations of the SPAR Marketing Companies as of the
dates and for the periods indicated, subject in the case of the Interim
SPAR Marketing Financial Statements to nonrecurring year end audit
adjustments, which adjustments would not in the aggregate be materially
adverse to the financial condition of the SPAR Marketing Companies. To the
knowledge of the SPAR Parties, based upon such audit, the Audited MCI
Financial Statements have been prepared in accordance with GAAP
consistently applied throughout the periods involved and fairly present the
pro forma financial position and the results of operations of MCI as of the
dates and for the periods indicated.

(b) The Interim SPAR Marketing Financial Statements contain all
adjustments of a normal recurring nature, based upon historical operations
of the SPAR Marketing Companies and reporting

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determinations made with respect to the most recent Audited SPAR Marketing
Financial Statements, necessary to present fairly the financial position
for the periods then ended.

SECTION 3.06. Permits. Except as otherwise set forth in the SPAR Disclosure
Letter:

(a) Each SPAR Marketing Company owns, holds, possesses or lawfully
uses in the operation of its business all governmental franchises,
licenses, permits, easements, rights, applications, filings, registrations
and other authorizations that are necessary for it to conduct its business
as now conducted in all material respects or for the ownership and use of
the material assets owned or used by such SPAR Marketing Company in the
conduct of its business (each a "SPAR Permit" and collectively the "SPAR
Permits").

(b) Each SPAR Permit is valid and in full force and effect, and no
SPAR Permit will be terminated or impaired in any material respect or
become terminable as a result of the SPAR Premerger Transactions, the
Merger or any other transaction contemplated by this Agreement.

SECTION 3.07. Real and Personal Property. Except as otherwise set forth in
the SPAR Disclosure Letter:

(a) All buildings, leasehold improvements, structures, facilities, and
fixtures used in any material respect by any SPAR Marketing Company in the
conduct of its business (limited in the case of leased property to the
primary demised premises) (each a "SPAR Premises") (i) are leased by any
SPAR Marketing Company pursuant to a valid lease (each a "SPAR Realty
Lease" and collectively the "SPAR Realty Leases"), except as may be limited
by the Bankruptcy Exceptions, (ii) are in good operating condition and
repair (subject to normal wear and tear, replacement, retirement, and
maintenance), (iii) are usable in the regular and ordinary course of
business, and (iv) are used in compliance in all material respects with all
Applicable Laws and authorizations relating to their construction (limited
to tenant improvements in the case of leased property), use and operation.
A list of all SPAR Realty Leases is set forth in the SPAR Disclosure
Letter. No SPAR Marketing Company owns any real estate.

(b) All items of equipment and other tangible property and assets used
in any material respect by any SPAR Marketing Company in the conduct of its
business (i) are either (A) owned by any SPAR Marketing Company, or (B)
leased by any SPAR Marketing Company pursuant to a valid lease (each a
"SPAR Personalty Lease" and collectively the "SPAR Personalty Leases"),
except as may be limited by the Bankruptcy Exceptions, (ii) are in good
operating condition and repair (subject to normal wear and tear,
replacement, retirement, and maintenance), (iii) are usable in the regular
and ordinary course of business, and (iv) comply in all material respects
with all Applicable Laws and authorizations relating to their construction,
use and operation. A list of all SPAR Personalty Leases is set forth in the
SPAR Disclosure Letter.

SECTION 3.08. Contracts and Commitments. The SPAR Disclosure Letter sets
forth an accurate, correct and complete list of all material agreements,
contracts, commitments, arrangements and understandings, written or oral,
including all amendments and supplements thereto, of each SPAR Marketing Company
(the "SPAR Contracts"), to which any SPAR Marketing Company is a party or is
bound, or by which any of their respective assets are bound, and which involve
any:

(a) agreement, contract, commitment or other legally binding
arrangement with any present or former (within the past two years) officer,
employee or material consultant involving annual salaries or minimum annual
payments of $100,000 or more (excluding normal salesmen's commissions);

(b) agreement, contract, commitment or other legally binding
arrangement for the future purchase of, or payment for, supplies or
products, or for the performance of services by a third party involving in
any one case $100,000 or more (other than those that may be terminated
without penalty);

(c) agreement, contract, commitment or other legally binding
arrangement to sell or supply products or to perform services involving in
any one case $100,000 or more (other than those that may be terminated
without penalty);

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(d) agreement, contract, commitment or other legally binding
arrangement continuing over a period of more than twelve months from the
date hereof and requiring more than $100,000 in annual payments by a SPAR
Marketing Company;

(e) sales representative, sales agency or similar agreement, contract,
commitment or other legally binding arrangement with any Person not under
the employ, control or direction of a SPAR Marketing Company;

(f) agreement, contract, commitment or other legally binding
arrangement containing a provision to indemnify any person or entity or
assume any tax, environmental or other non-ordinary course liability;

(g) agreement, contract, commitment or other legally binding
arrangement with any Governmental Entity (other than a SPAR Permit);

(h) note, debenture, bond, equipment trust agreement, letter of credit
agreement, loan agreement or other contract for the borrowing or lending of
money, or any guarantee, pledge or undertaking of or credit support for the
indebtedness of any other person by any SPAR Marketing Company;

(i) agreement, contract, commitment or other legally binding
arrangement for any charitable or political contribution;

(j) agreement, contract, commitment or other legally binding
arrangement for any capital expenditure or leasehold improvement in excess
of $100,000;

(k) agreement, contract, commitment or other legally binding
arrangement limiting or restraining: (i) any SPAR Marketing Company or any
successor thereto from engaging in the businesses of the SPAR Parties or
PIA Parties post Merger (other than any customer contract not in excess of
$100,000 that may contain such a prohibition with respect to the
performance of services for the customer's competitors); or (ii) to the
knowledge of any SPAR Marketing Company, any employee of any SPAR Marketing
Company from engaging in or competing with the businesses of the SPAR
Parties or PIA Parties post Merger on behalf of the Parties; or

(l) agreement, contract, commitment or other legally binding
arrangement of any SPAR Marketing Company not made in the ordinary course
of business (other than as would have been disclosable in one of the
preceding clauses but for the amount or term thereof);

in each case excluding the SPAR Premerger Agreements, the SPAR Realty Leases,
the SPAR Personalty Leases, the SPAR Trademark Licenses, the SPAR Permits and
this Agreement (which are not intended, and shall not be deemed or construed, to
be SPAR Contracts). Except as otherwise set forth in the SPAR Disclosure Letter:
(A) each of the SPAR Contracts is valid and enforceable in all material
respects, except as may be limited by the Bankruptcy Exceptions; (B) each SPAR
Marketing Company is, and to the knowledge of such SPAR Marketing Company, all
other parties thereto are, in material compliance with the provisions thereof in
all material respects; and (C) no SPAR Marketing Company is nor has ever been a
party to any contract with any Governmental Entity subject to retroactive price
redetermination or renegotiation.

SECTION 3.09. Insurance. Except as otherwise set forth in the SPAR
Disclosure Letter: (a) the assets, properties and operations of each SPAR
Marketing Company are insured under various policies of general liability,
workers' compensation and other forms of insurance in amounts that are adequate
in the judgment of the SPAR Marketing Companies in relation to the business and
assets of such SPAR Marketing Company; (b) all such policies are in full force
and effect in accordance with their terms, no notice of cancellation has been
received, and to the knowledge of the SPAR Marketing Companies, with respect to
any such policy, there is no existing default or event that with the giving of
notice or lapse of time (or both), would constitute a material default under any
such policy; and (c) no SPAR Marketing Company has been refused any insurance,
nor has any SPAR Marketing Company's coverage been limited, by any insurance
carrier to which it has applied for insurance or with which it has carried
insurance during the past five years.

SECTION 3.10. Employees. Except as otherwise set forth in the SPAR
Disclosure Letter: (a) there have not been in the past five years and, to the
knowledge of the SPAR Marketing Companies, there are not pending, any organized
or coordinated labor disputes, work stoppages, requests for representation,
pickets or work slow-downs due to labor disagreements; (b) there are and have
been no unresolved material violations of

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any laws of any Governmental Entity respecting the employment of any employees;
(c) there is no unfair labor practice, charge or complaint pending, unresolved
or, to the knowledge of the SPAR Marketing Companies, overtly threatened that
would be reasonably likely to be brought or filed with the National Labor
Relations Board or similar body in any foreign country; (d) the employees of the
SPAR Marketing Companies are not covered by any collective bargaining agreement;
and (e) each SPAR Marketing Company has paid or properly accrued in accordance
with GAAP in the ordinary course of business all wages and compensation due to
employees, including all vacations or vacation pay, holidays or holiday pay,
sick days or sick pay, and bonuses.

SECTION 3.11. Employee Benefit Plans and Arrangements. Except as otherwise
set forth in the SPAR Disclosure Letter:

(a) The SPAR Disclosure Letter sets forth a complete and accurate list
of each Benefit Plan covering any present or former officers, employees,
consultants, or directors of any SPAR Marketing Company (a "SPAR Benefit
Plan"). As used in this Agreement: "ERISA" shall mean the Employee
Retirement Income Security Act of 1974, as amended, and the rules and
regulations promulgated thereunder, as the same may be supplemented,
modified, amended, restated or replaced from time to time; "Pension Plan"
of a referenced party shall mean each "employee pension benefit plan" (as
defined in Section 3(2) of ERISA) of the referenced party; "Welfare Plan"
of a referenced party shall mean each "employee welfare benefit plan" (as
defined in Section 3(i) of ERISA) of the referenced party; "Other ERISA
Benefit" of a referenced party shall mean any plan or agreement governed by
ERISA or the Code of the referenced party relating to deferred
compensation, bonus and performance compensation (other than salesmen
commissions), stock purchase, stock option, stock appreciation, severance,
vacation, sick leave, holiday fringe benefits, personnel policy,
reimbursement program, insurance, welfare or similar plan, program, policy
or arrangement; and "Benefit Plan" of a referenced party shall mean each
Pension Plan, Welfare Plan and Other ERISA Benefit of the referenced party;
in each case to the extent maintained or contributed to, or required to be
maintained or contributed to, by or for which there otherwise is any
liability as of the Effective Time, of such party or its respective
affiliates or any other person or entity that, together with such party, is
treated as a single employer under Section 414(b), (c), (m) or (o) of the
Code (each, together with such party, a "Commonly Controlled Entity") for
the benefit of any present or former officer, employee, consultant or
director.

(b) Each SPAR Benefit Plan is in substantial compliance with all
reporting, disclosure and other requirements applicable to such SPAR
Benefit Plan. Each SPAR Benefit Plan that is a Pension Plan and intended to
be qualified under Section 401(a) of the Code (each a "SPAR Pension Plan")
has been determined by the Internal Revenue Service to be so qualified and,
to the knowledge of the SPAR Marketing Companies, no condition exists or
has occurred that would adversely affect any such determination. Neither
any SPAR Benefit Plan, nor any SPAR Marketing Company, nor to the knowledge
of any SPAR Marketing Company any Commonly Controlled Entity of any SPAR
Marketing Company or any trustee or agent of any SPAR Benefit Plan, has
been or is presently engaged in any prohibited transactions as defined by
Section 406 of ERISA or Section 4975 of the Code (i) for which an exemption
is not applicable, or (ii) that would be reasonably likely to subject any
SPAR Marketing Company to a material amount of tax or penalty imposed by
Section 4975 of the Code or Section 502 of ERISA. To the knowledge of the
SPAR Marketing Companies, there is no event or condition existing that
would be deemed a "reportable event" (within the meaning of Section 4043 of
ERISA) with respect to which the thirty-day notice requirement has not been
waived. To the knowledge of the SPAR Marketing Companies, no condition
exists that would be reasonably likely to subject any SPAR Marketing
Company to a material amount of penalty under Section 4071 of ERISA.

(c) Neither any SPAR Marketing Company nor any Commonly Controlled
Entity of any SPAR Marketing Company is or has ever been party to any
"multi-employer plan," as that term is defined in Section 3(37) of ERISA.
True and correct copies of (i) the most recent annual report (Form 5500
series) and any attached schedules for each SPAR Benefit Plan (if any such
report was required by applicable law), (ii) the most recent summary plan
description for each SPAR Benefit Plan and (iii) the most recent
determination letter issued by the Internal Revenue Service for each SPAR
Pension Plan have been provided to PIA Delaware.

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(d) With respect to each SPAR Benefit Plan, there are no actions,
suits or claims (other than routine claims for benefits in the ordinary
course or relating to qualified domestic relations orders within the
meaning of Section 414(p) of the Code) pending or, to the knowledge of the
SPAR Marketing Companies, overtly threatened against any SPAR Benefit Plan,
any SPAR Marketing Company, any Commonly Controlled Entity of any SPAR
Marketing Company or any trustee or agent of any SPAR Benefit Plan, nor to
the knowledge of the SPAR Marketing Companies, is there any reasonable
basis for such claims.

(e) With respect to each SPAR Benefit Plan to which any SPAR Marketing
Company or any Commonly Controlled Entity of any SPAR Marketing Company is
a party which constitutes a group health plan subject to Section 4980B of
the Code, each such SPAR Benefit Plan substantially complies, and in each
case has substantially complied, with all applicable requirements of
Section 4980B of the Code. There is no outstanding material liability
(except for premiums that have not become overdue) or other accrued but
unpaid obligations under Title IV of ERISA with respect to any SPAR Pension
Plan, and no condition exists that would be reasonably expected to result
in any SPAR Marketing Company incurring a material liability under Title IV
of ERISA, either directly or with respect to any Commonly Controlled Entity
of any SPAR Marketing Company. All premiums payable to the Pension Benefit
Guaranty Corporation (the "PBGC") have been paid prior to becoming overdue.
Neither the PBGC nor any SPAR Marketing Company nor any Commonly Controlled
Entity of any SPAR Marketing Company has instituted proceedings to
terminate any SPAR Pension Plan that is subject to Title IV of ERISA, and
the PBGC has not informed any SPAR Marketing Company of its intent to
institute proceedings to terminate any such plan. Full payment has been
made of all amounts that any SPAR Marketing Company or any Commonly
Controlled Entity of any SPAR Marketing Company was required to have paid
as a contribution to any SPAR Pension Plan that is subject to Title IV of
ERISA (with applicability determined as of the last day of the most recent
fiscal year of each of the SPAR Pension Plans ended prior to the date of
this Agreement), and none of the SPAR Pension Plans has incurred any
material amount of "accumulated funding deficiency" (as defined in Section
302 of ERISA and Section 412 of the Code), whether or not waived, as of the
last day of the most recent fiscal year of each such SPAR Pension Plan
ended prior to the date of this Agreement.

(f) No SPAR Pension Plan is a defined benefit pension plan. Each SPAR
Benefit Plan is, and its administration is and at all times has been in
substantial compliance with, and no SPAR Marketing Company has received any
claim or notice that any such SPAR Benefit Plan is not in substantial
compliance with, its terms and all Applicable Laws, including without
limitation, to the extent applicable, the requirements of ERISA and the
Code. No SPAR Marketing Company and no Commonly Controlled Entity of any
SPAR Marketing Company is in default in any material respect in performing
any of its contractual obligations under any SPAR Benefit Plan or any
related trust agreement or insurance contract. There are no material
outstanding liabilities of any SPAR Benefit Plan other than liabilities for
benefits to be paid to participants in any SPAR Benefit Plan and their
beneficiaries in accordance with the terms of such SPAR Benefit Plan. Each
SPAR Benefit Plan may be amended or modified or terminated by the
applicable SPAR Marketing Company or a Commonly Controlled Entity of a SPAR
Marketing Company at any time without liability except under any defined
pension benefit plan. No SPAR Benefit Plan other than a SPAR Pension Plan,
retiree medical plan or severance plan provides benefits to any individual
after termination of employment.

(g) The consummation of the transactions contemplated by the SPAR
Premerger Agreements and this Agreement will not: (A) entitle any employee
of any SPAR Marketing Company to severance pay, unemployment compensation
or any other payment or benefit; (B) accelerate the time of payment or
vesting, or increase the amount of compensation due to any such employee;
(C) result in any liability under Title IV of ERISA; (D) result in any
prohibited transaction described in Section 406 of ERISA or Section 4975 of
the Code for which an exemption is not available; or (E) result (either
alone or in conjunction with any other event) in the payment or series of
payments by any SPAR Marketing Company or any of its affiliates to any
person of an "excess parachute payment" within the meaning of Section 280G
of the Code.

(h) With respect to each SPAR Benefit Plan that is funded wholly or
partially through an insurance policy, all material amounts of premiums
required to have been paid to date under the insurance policy

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have been paid, all material amounts of premiums required to be paid under
the insurance policy through the Closing Date will have been paid on or
before the Closing Date and, as of the Closing Date, there will be no
material amount of liability of any SPAR Marketing Company or any Commonly
Controlled Entity of any SPAR Marketing Company under any insurance policy
or ancillary agreement with respect to such insurance policy in the nature
of a retroactive rate adjustment, loss sharing arrangement or other actual
or contingent liability arising wholly or partially out of events occurring
prior to the Closing Date.

(i) Each SPAR Benefit Plan that constitutes a "welfare benefit plan"
(within the meaning of Section 3(i) of ERISA) for which contributions are
claimed by any SPAR Marketing Company or any Commonly Controlled Entity of
any SPAR Marketing Company as deductions under any provision of the Code is
in material compliance with all applicable requirements pertaining to such
deduction. With respect to any "welfare benefit fund" (within the meaning
of Section 419 of the Code) related to such a welfare benefit plan, there
is no disqualified benefit (within the meaning of Section 4976(b) of the
Code) that would result in the imposition of a tax under Section 4976(a) of
the Code. All welfare benefit funds intended to be exempt from tax under
Section 501(a) of the Code have been determined by the Internal Revenue
Service to be so exempt and no event or condition exists or has occurred
which would adversely affect any such determination.

(j) No SPAR Marketing Company has any Benefit Plan outside of the
United States.

(k) All persons classified by any SPAR Marketing Company as
independent contractors or "leased employees" within the meaning of Section
414(n) of the Code ("SPAR Leased Employees") satisfy and have at all times
satisfied the requirements of applicable law to be so classified. Each SPAR
Marketing Company has fully and accurately reported their compensation on
IRS Forms 1099 when required to do so. No SPAR Marketing Company has any
obligation to provide benefits with respect to such independent contractors
or SPAR Leased Employees under any SPAR Benefit Plan or otherwise.

SECTION 3.12. Compliance with Law. Except as otherwise set forth in the
SPAR Disclosure Letter: each SPAR Marketing Company has complied in all material
respects with each, and is not in violation in any material respect of, any
Applicable Law to which such SPAR Marketing Company's business, operations,
assets or properties are subject.

SECTION 3.13. Transactions With Affiliates. Except as otherwise set forth
in the SPAR Disclosure Letter: (a) no stockholder and no director, officer or
employee of any SPAR Marketing Company, or any member of his or her immediate
family or any other of its, his or her affiliates, owns or has a 5% or more
ownership interest in any material business, corporation or other entity that is
or was during the last three years a party to, or in any property which is or
was during the last three years the subject of, any contract, agreement,
commitment or legally binding arrangement with such SPAR Marketing Company; and
(b) the SPAR Disclosure Letter includes a complete list as of the date hereof of
all amounts owed by any SPAR Marketing Company to any SPAR Principal (other than
salary and expense reimbursements in the normal course) or any affiliate of any
SPAR Principal (other than for goods purchased or services rendered in the
normal course) or owed on account of any loan or advance to any SPAR Marketing
Company by any SPAR Principal or any affiliate of any SPAR Principal (other than
for goods purchased or services rendered in the normal course).

SECTION 3.14. Litigation. Except as otherwise set forth in the SPAR
Disclosure Letter, as of the date hereof: (a) no litigation, including any
arbitration, investigation or other proceeding of or before any Governmental
Entity, is pending (or to the knowledge of the SPAR Marketing Companies) overtly
threatened against any SPAR Marketing Company, other than litigation that (i) is
not reasonably likely to be adversely determined or (ii) if reasonably likely to
be adversely determined, would not be reasonably likely to have, individually or
in the aggregate with other such litigation, a SPAR Material Adverse Effect; and
(b) no SPAR Marketing Company is a party to or subject to the provisions of any
SPAR Court Order.

SECTION 3.15. Taxes. Except as otherwise set forth in the SPAR Disclosure
Letter:

(a) All federal, state, local and foreign tax returns, reports,
statements and other similar filings required to be filed by any SPAR
Marketing Company (the "SPAR Tax Returns") with respect to any material
federal, state, local or foreign taxes, assessments, interest, penalties,
deficiencies, fees and other governmental charges or impositions (including
without limitation all income tax, unemployment

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compensation, social security, payroll, withholding, sales and use, excise,
privilege, property, ad valorem, franchise, license, school and any other
tax or similar governmental charge or imposition, and interest and
penalties therein, under the Applicable Laws of the United States or any
state or Municipal or political subdivision thereof or any foreign country
or political subdivision thereon ("Taxes") have been timely filed with the
appropriate governmental agencies in all jurisdictions in which such SPAR
Tax Returns are required to be filed, and all such SPAR Tax Returns are
true, complete and correct in all material respects and fairly reflect the
liabilities of the SPAR Marketing Companies for Taxes for the periods,
property or events covered thereby.

(b) All Taxes, including (without limitation) those called for by the
SPAR Tax Returns, required to be paid or withheld by any SPAR Marketing
Company and any deficiency assessments, penalties and interest for which a
notice of assessment has been received (other than as may have been settled
and paid in full in accordance therewith, and other than those being
contested, if any, as set forth in the SPAR Disclosure Letter) have been
timely paid or withheld.

(c) The accruals for Taxes contained in the Interim SPAR Marketing
Financial Statements for the Tax liabilities of the SPAR Marketing
Companies have been made in accordance with GAAP as of that date and
include adequate provision under GAAP for all deferred Taxes (other than
necessary increments due to the passage of time), except that no accruals
have been made for income Taxes for SINC and SBRS, which are Subchapter S
corporations under the Code. SMF utilizes the accrual method of accounting
for income tax purposes, SINC and SBRS utilize the cash method of
accounting for income tax purposes, and none of them has changed its method
of accounting for income tax purposes in the past five years. Each SPAR
Marketing Company that has filed SPAR Tax Returns under Subchapter S of the
Code has made a timely and effective election to be taxed under the
provisions of Subchapter S of the Code and has at no time been taxable
under the provisions of Subchapter C of the Code. No such SPAR Marketing
Company has any net unrealized built-in gain that has not been recognized
within the meaning of Section 1374 of the Code.

(d) No SPAR Marketing Company is or has at any time ever been a party
to a Tax sharing, Tax indemnity or Tax allocation agreement, and no SPAR
Marketing Company has assumed any Tax liability of any other person or
entity under contract.

(e) No SPAR Marketing Company has received any notice of assessment or
proposed assessment in connection with any SPAR Tax Returns, other than as
may have been settled and paid in full in accordance therewith, and there
are no pending tax examinations of or material tax claims asserted against
any SPAR Marketing Company or any of its assets or properties. No SPAR
Marketing Company has extended, or waived the application of, any statute
of limitations of any jurisdiction regarding the assessment or collection
of any Taxes.

(f) There are now, and as of immediately following the Effective Time
there will be, no liens (other than any lien for Taxes not yet overdue and
payable) on any of the assets or properties of any SPAR Marketing Company
relating to or attributable to Taxes. To the knowledge of the SPAR
Marketing Companies, there is no reasonable basis for the assertion of any
claim relating to or attributable to Taxes that, if adversely determined,
would result in any lien on the assets of any SPAR Marketing Company or
otherwise have a SPAR Material Adverse Effect.

(g) None of the SPAR Marketing Companies has any knowledge of any
reasonable basis for any additional assessment of any Taxes for any period
ending on or before the Closing Date (other than increased Taxes based upon
increased business units, business sites, payroll, profits or other taxable
attribute relating to an expanding enterprise prior to the Closing Date).
All Tax payments related to employees, including income tax withholding,
FICA, FUTA, unemployment and worker's compensation, required to be made by
the SPAR Marketing Companies, have been fully and properly paid, withheld,
accrued or recorded.

SECTION 3.16. Intellectual Property Matters. Except as otherwise set forth
in the SPAR Disclosure Letter:

(a) The SPAR Disclosure Letter sets forth all patents, trademarks,
trade names, service marks, copyrights, software, material trade secrets or
material know-how owned or used in any material respect

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by any SPAR Marketing Company in the conduct of its business (the "SPAR
Intellectual Property"), excluding, however, all readily commercially
available software programs licensed to a SPAR Marketing Company (for
example, without limitation, Windows, Windows NT, MS Word, MS Excel, and MS
Explorer) ("Commercial Software"), which Commercial Software need not be
set forth on such schedule. All of the SPAR Intellectual Property is (or
will be as of the Effective Time) owned by or licensed to STM or one of the
SPAR Marketing Companies free and clear of any liens (except insofar as a
license or the restrictions thereunder may constitute a lien, and except
for the SPAR Trademark Licenses and the Business Manager Agreement). At or
before the Closing, (i) SIT and SMS will enter into non-exclusive perpetual
royalty free licenses with STM respecting their use of the name "SPAR" and
certain other trademarks and related rights owned or to be owned by STM
(the "SPAR Trademark Licenses") such agreement to be substantially in the
form attached as Exhibit C hereto, and (ii) SMF, SMS and SIT will enter
into a Software Ownership Agreement with respect to the Internet job
scheduling software (called "Business Manager") jointly developed and owned
by them, such agreement to be substantially in the form attached as Exhibit
D hereto (the "Business Manager Agreement").

(b) There are no ongoing royalty, commission or similar arrangements,
and no licenses, sublicenses or agreements from any SPAR Marketing Company
as a licensor, pertaining to the current use of the SPAR Intellectual
Property, except as may be applicable under the Commercial Software, the
SPAR Trademark Licenses and the Business Manager Agreement.

(c) No SPAR Marketing Company infringes upon or unlawfully or
wrongfully uses any patent, trademark, trade name, service mark, copyright
or trade secret owned or claimed by any other person or entity. No action,
suit, proceeding or investigation has been instituted or, to the knowledge
of the SPAR Marketing Companies, overtly threatened relating to any,
patent, trademark, trade name, service mark, copyright or trade secret
formerly or currently used by any SPAR Marketing Company. None of the SPAR
Intellectual Property is subject to any outstanding order, decree or
judgment. No SPAR Marketing Company has agreed to indemnify any person or
entity for or against any infringement of or by the SPAR Intellectual
Property. Except for (i) the SPAR Intellectual Property licensed or to be
licensed to SMS and SIT by STM, (ii) the common ownership of the software
reflected in the Business Manager Agreement, and (iii) the ownership of and
director and officer positions in the SPAR Marketing Companies, SGI, SMS,
SIT, STM and the SPAR Parties, no present or former employee of any SPAR
Marketing Company, and no person or entity other than SGI, SMS, SIT, STM
and the SPAR Parties (and the SPAR Principals solely as the officers and
shareholders thereof), directly or indirectly owns or has any proprietary,
financial or other interest in, in whole or in part, any SPAR Intellectual
Property.

(d) All SPAR Intellectual Property in the form of computer software
that is utilized by any SPAR Marketing Company in the operation of its
business is capable of processing date data between and within the
twentieth and twenty-first centuries or can be rendered capable of
processing such data prior to the date necessary to avoid disruption of its
business by utilizing the employees of one or more of the SPAR Marketing
Companies in the normal course of business and by expenditure of not more
than $100,000 in excess of the cost of software purchased for reasons other
than the failure of existing software to be capable of such processing.

SECTION 3.17. Existing Condition. Except as otherwise set forth in the SPAR
Disclosure Letter, since the Interim SPAR Marketing Balance Sheet Date, no SPAR
Marketing Company has:

(a) incurred any liabilities, other than liabilities incurred in the
ordinary course of business consistent with past practice (including,
without limitation, advances under its commitments and lines of credit),
the liabilities contemplated under the SPAR Premerger Agreements;

(b) discharged or satisfied any lien or encumbrance or paid any
liabilities, other than in the ordinary course of business consistent with
past practice (including, without limitation, repayments under its
commitments and lines of credit), or failed to pay or discharge when due
any liabilities, other than in the ordinary course of business consistent
with past practice, or where the obligation is being contested in good
faith, and the failure to pay or discharge has not caused and would not be
reasonably likely to cause any SPAR Material Adverse Effect;

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(c) sold, encumbered, assigned or transferred any assets, properties
or rights or any interest therein, or made any agreement or commitment or
granted any option or right with, of or to any person to acquire any
assets, properties or rights of any SPAR Marketing Company or any interest
therein, except for sales and dispositions in the ordinary course of
business consistent with past practice, and except for the transactions
contemplated under the SPAR Premerger Agreements and this Agreement;

(d) created, incurred, assumed or guaranteed any indebtedness for
money borrowed, or mortgaged, pledged or subjected any of its assets to any
mortgage, lien, pledge, security interest, conditional sales contract or
other encumbrance of any nature whatsoever, other than (i) in the ordinary
course of business (including, without limitation, future advances and
floating liens under existing, increased or replacement credit facilities),
or (ii) in connection with the financing of the MCI Acquisition;

(e) made or suffered any early cancellation or termination of any
Material SPAR Document (other than in the ordinary course of business with
a vendor to a SPAR Marketing Company); or amended, modified or waived any
substantial debts or claims held by it under any Material SPAR Document
other than in the ordinary course of business;

(f) declared, set aside or paid any dividend or made or agreed to make
any other distribution or payment in respect of its capital shares or
redeemed, purchased or otherwise acquired or agreed to redeem, purchase or
acquire any of shares of its capital stock or its other ownership
interests;

(g) suffered any damage, destruction or loss that has had or will have
(i) a SPAR Material Adverse Effect, or (ii) a replacement cost individually
or in the aggregate at more than $100,000;

(h) suffered any repeated, recurring or prolonged shortage, cessation
or interruption of supplies or utility or other services required to
conduct its business and operations;

(i) suffered any material adverse change in the business, operations,
properties, assets or financial condition of the SPAR Marketing Companies
taken as a whole;

(j) received notice or had knowledge of any actual or overtly
threatened organized or coordinated labor trouble, strike or other similar
occurrence, event or condition of any similar character that has had or
would be reasonably likely to have a SPAR Material Adverse Effect;

(k) increased the salaries or other compensation of, or made any
advance (excluding advances for ordinary and necessary business expenses)
or loan to, any of its employees or made any increase in, or any addition
to, other benefits to which any of its employees are entitled (in each case
other than increases in salaries or other compensation in the ordinary
course of business consistent with past practice and that in the aggregate
have not resulted in a SPAR Material Adverse Effect);

(l) changed any of the accounting principles followed by it or the
methods of applying such principles, other than the contemplated change for
certain of the SPAR Marketing Companies from "subchapter s" status to
"subchapter c" status for federal income tax purposes (to be effected
shortly before the Effective Time) and other changes in implementing the
SPAR Premerger Transactions;

(m) except as contemplated by the SPAR Premerger Agreements or this
Agreement, entered into any transaction other than in the ordinary course
of business consistent with past practice;

(n) except as contemplated by the SPAR Premerger Agreements or this
Agreement, changed its authorized capital or its securities outstanding or
otherwise changed its ownership interests, or granted any options,
warrants, calls, conversion rights or commitments with respect to any of
its capital stock or other ownership interests; or

(o) agreed to take any of the actions referred to above.

SECTION 3.18. Books of Account. Except as otherwise set forth in the SPAR
Disclosure Letter: (a) the books, records and accounts of each SPAR Marketing
Company accurately and fairly reflect, in reasonable detail, the transactions
and the assets and liabilities of such SPAR Marketing Company; and (b) no SPAR
Marketing Company has engaged in any transaction, maintained any bank account or
used any of the funds of such SPAR Marketing Company except for transactions,
bank accounts and funds that have been and are fairly reflected in the normally
maintained books and records of the business.

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SECTION 3.19. Environmental Matters. Except as otherwise set forth in the
SPAR Disclosure Letter:

(a) Each SPAR Marketing Company has secured, and is in compliance in
all material respects with, all Environmental Permits (as such term is
defined below), with respect to any premises on which its business is
operated. Each SPAR Marketing Company is in compliance in all material
respects with all applicable Environmental Laws (as hereinafter defined).

(b) As used herein: (i) "Environmental Laws" shall mean any and all
treaties, laws, regulations, ordinances, enforceable requirements, binding
determinations, orders, decrees, judgments, injunctions, permits,
approvals, authorizations, licenses or binding agreements issued,
promulgated or entered into by any Governmental Entity, relating to the
environment, preservation or reclamation of natural resources, or to the
management, Release (as defined below) or overtly threatened Release of or
exposure to Hazardous Substances (as such term is defined below),
including, CERCLA (as such term is defined below), the Resource
Conservation and Recovery Act. 42 U.S.C. Section 6901 et seq., the Federal
Water Pollution Control Act, 33 U.S.C. Section 1251 et seq., the Clean Air
Act, 42 U.S.C. Section 7401 et seq., the Toxic Substances Control Act, 15
U.S.C. Section 2601 et seq., the Occupational Safety and Health Act, 29
U.S.C. Section 651 et seq., the Emergency Planning and Community
Right-to-Know Act of 1986, 42 U.S.C. Section 11001 et. seq., the Safe
Drinking Water Act, 42 U.S.C. Section 300(f) et seq., the Hazardous
Materials Transportation Act, 49 U.S.C. Section 1801 et seq., and any
similar or implementing state or local law and all amendments or
regulations promulgated thereunder; (ii) "Release" shall mean any spill,
emission, leaking, pumping, injection, deposit, disposal, discharge,
dispersal, leaching, emanation or migration of any Hazardous Substance in,
into, onto or through the environment (including ambient air, surface
water, ground water, soils, land surface, subsurface strata, workplace or
structure); (iii) "CERCLA" shall mean the Comprehensive Environmental
Response, Compensation, and Liability Act, 42 U.S.C. Section 9601 et seq.;
(iv) "Hazardous Substances" shall mean any waste or other substance that is
listed, defined, designated, or classified as, or otherwise determined to
be, hazardous, radioactive, or toxic under or pursuant to any Environmental
Law, including any admixture or solution thereof, and specifically
including petroleum and all derivatives thereof or synthetic substitutes
therefor and asbestos or asbestos-containing materials; and (v) the term
"Environmental Permits" means all permits, licenses, approvals or
authorizations from any Governmental Entity required under Environmental
Laws.

(c) No SPAR Marketing Company has: (x) received any written
communication from any Governmental Entity that alleges that any SPAR
Marketing Company is not in compliance in any material respect with any
Environmental Laws or Environmental Permits; (y) entered into or agreed to
any court decree or order, and no SPAR Marketing Company is subject to any
judgment, decree or order, relating to compliance with any Environmental
Law or to investigation or cleanup of a Hazardous Substance under any
Environmental Law in any material respect; or (z) received a CERCLA 104(e)
information request or has been named a potentially responsible party for
any National Priorities List site under CERCLA or any site under analogous
state law or received an analogous notice or request from any non-U.S.
Governmental Entity, which notice, request or any resulting inquiry or
litigation has not been fully and finally resolved without possibility of
reopening. No lien, charge, interest or encumbrance has been attached,
asserted, or to the knowledge of the SPAR Marketing Companies, overtly
threatened to or against any material assets or properties of any SPAR
Marketing Company pursuant to any Environmental Law.

(d) To the knowledge of the SPAR Marketing Companies: (i) there has
been no unlawful treatment, storage, disposal or release by any SPAR
Marketing Company or any of its representatives of any Hazardous Substance
on any SPAR Premises; (ii) there has been no unlawful treatment, storage,
disposal or release of any Hazardous Substance on any SPAR Premises; (iii)
there are no aboveground storage tanks located on or underground storage
tanks located within any SPAR Premises; (iv) each aboveground storage tank
formerly located on or underground storage tank formerly located within any
SPAR Premises (if any) have been removed in accordance with all
Environmental Laws and no residual contamination from any Hazardous
Substance, if any, remains at such sites in excess of applicable standards
under Applicable Law; (v) there are no polychlorinated biphenyls ("PCBs")
leaking from any article, container or equipment located on or under any
SPAR Premises, and there are no such articles, containers or equipment
containing leaking PCBs; and (vi) there is no asbestos containing material
not

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contained in a manner reasonably acceptable under Applicable Law in any
material respect located on or under any SPAR Premises.

SECTION 3.20. No Illegal Payments. No SPAR Marketing Company and, to the
knowledge of the SPAR Marketing Companies, no affiliate, officer, agent or
employee of any SPAR Marketing Company, has directly or indirectly on behalf of
or with respect to any SPAR Marketing Company during the past five years, (a)
made any unlawful domestic or foreign political contributions, (b) made any
payment or provided services that were unlawful in any material respect for such
Person to make or provide or for the recipient to receive, (c) received any
payment or services that were unlawful in any material respect for the payer or
the provider of such services to make or provide, or (d) made any payment to any
person or entity, or agent or employee thereof, in connection with any SPAR
Contract to induce such person or entity to enter into such SPAR Contract that
were unlawful in any material respect for the payer to make or provide or the
recipient to receive. No SPAR Marketing Company has during the past five years,
(i) had any transactions or payments not recorded in their accounting books and
records in accordance with GAAP in any material respect, or (ii) had any
off-book bank or cash accounts or "slush funds" related to any SPAR Marketing
Company.

SECTION 3.21. Brokers. The SPAR Disclosure Letter lists all investment
banking fees, finders' fees, brokers' commissions and similar payments which any
SPAR Marketing Company or (to the knowledge of any SPAR Marketing Company) any
SPAR Principal has paid or will be obligated to pay in connection with the
transactions contemplated by the SPAR Premerger Agreements or this Agreement.

SECTION 3.22. No Misrepresentation by the SPAR Marketing Companies. The
representations and warranties of the SPAR Marketing Companies made or contained
in this Agreement (whether with respect to any SPAR Marketing Company or
otherwise), and the information contained in the SPAR Disclosure Letter and the
other certificates, schedules and documents furnished by or on behalf of any
SPAR Marketing Company in connection with the transactions contemplated by this
Agreement (whether with respect to any SPAR Marketing Company or otherwise), do
not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein in order to make it, in the light of
the circumstances under which made, not misleading.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE PIA PARTIES

Except as otherwise disclosed in that certain letter of even date herewith
delivered to the SPAR Parties prior to the execution hereof (which letter shall
contain appropriate references and cross references to identify the Sections
hereof to which the information in such letter relates) (the "PIA Disclosure
Letter"), each PIA Party, jointly and severally, represents and warrants to the
SPAR Parties as follows:

SECTION 4.01. Corporate Existence. Except as otherwise disclosed in the PIA
Disclosure Letter:

(a) Each PIA Party is a corporation duly organized, validly existing
and in good standing under the laws of its state of incorporation. PIA
Delaware has no subsidiaries other than PIA California. The PIA Disclosure
Letter sets forth a complete list of the subsidiaries of PIA California
(individually, a "PIA Subsidiary" and collectively, the "PIA Subsidiaries")
and the owner of each.

(b) Each PIA Subsidiary is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation. PIA Delaware, PIA California, and the PIA Subsidiaries are
sometimes collectively referred to individually as a "PIA Company" and
collectively as the "PIA Companies".

(c) Each PIA Company is duly qualified to conduct business and is in
good standing as a foreign corporation in each jurisdiction in which the
conduct of its business requires it to be so qualified, except where the
failure to be so qualified would not have a material adverse effect on the
business, operations, properties, assets or financial condition of the PIA
Companies taken as a whole (a "PIA Material Adverse Effect").

(d) As of the date of this Agreement, except to the extent it is the
sole stockholder of another PIA Company, no PIA Company owns, of record or
beneficially, or controls, directly or indirectly, any capital

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stock, any securities convertible into capital stock or any other equity
interest in any corporation, association or other business entity or is,
directly or indirectly, a participant in any joint venture, partnership or
other non-corporate entity.

SECTION 4.02. Authorization and Enforceability. Except as otherwise
disclosed in the PIA Disclosure Letter:

(a) Each PIA Party has the corporate power, authority and legal right
to execute, deliver and perform this Agreement and the other Merger
Documents to which it is a party.

(b) The execution, delivery and performance of this Agreement and each
of the other Merger Documents by each PIA Party (to the extent it is a
party thereto) have been duly authorized by all necessary corporate action
and no further corporate action on the part of any PIA Party is necessary
to authorize this Agreement or any other Merger Document to which it is a
party or the performance of the transactions contemplated hereby or
thereby; provided however, that the issuance of the shares of PIA Delaware
Stock pursuant to Section 2.01(a) (the "Share Issuance") (i) must be
approved by the stockholders of PIA Delaware in accordance with Rule
4310(c)(25) of The Nasdaq Stock Market (the "Nasdaq Rules") and (ii) cannot
be effected prior to the approval of the Proposed PIA Certificate of
Amendment (as defined in Section 4.03(b) hereof) by the stockholders of PIA
Delaware as required by the General Corporation Law of the State of
Delaware (the "DGCL").

(c) This Agreement has been duly executed and delivered on behalf of
each PIA Party and constitutes a legal, valid and binding obligation of
each PIA Party, enforceable in accordance with its terms, except as may be
limited by the Bankruptcy Exceptions.

SECTION 4.03. Capital Stock of the PIA Parties. Except as otherwise
disclosed in the PIA Disclosure Letter:

(a) As of the date of this Agreement, the authorized capital stock of
PIA Delaware consists of (i) 15,000,000 shares of PIA Delaware Stock, of
which 5,478,458 shares are issued and outstanding and fully paid and non
assessable, and (ii) 3,000,000 shares of preferred stock, $0.01 par value
per share, of which none have been issued or are outstanding. All of the
issued and outstanding shares of capital stock of PIA California are owned
beneficially and of record by PIA Delaware, all of the issued and
outstanding shares of capital stock of each of the PIA Subsidiaries are
owned beneficially and of record by PIA California, and all such shares of
capital stock are free and clear of all Restrictions and have been validly
issued and are fully paid and nonassessable.

(b) The Board of Directors of PIA Delaware (the "PIA Delaware Board")
(i) has authorized and approved the adoption of an amendment to PIA
Delaware's certificate of incorporation in the form annexed hereto as
Exhibit E (together with such changes as may be made therein in accordance
with the PIA Delaware Board's approval, but subject to the consent of the
SPAR Parties, the "Charter Amendment"), which (among other things) provides
for an increase in the authorized number of shares of PIA Delaware Stock to
47,000,000 shares, changes the name of PIA Delaware to "SPAR GROUP, INC."
(or such other name as the Parties may mutually agree prior to the mailing
of the PIA Proxy Materials) and deletes Article Tenth containing the
prohibition against actions by stockholders without a meeting (i.e.,
Charter Amendment No. 1, Charter Amendment No. 2, Charter Amendment No. 3
as defined in the PIA Proxy Statement); (ii) has authorized for inclusion
in the proxy statement, a proposal to authorize the PIA Delaware Board, if
deemed necessary in its sole discretion (after obtaining the consent of the
SPAR Parties, if such amendment is to be effected prior to the Merger or
the termination of this Agreement), to amend PIA Delaware's certificate of
incorporation (in the form annexed hereto as Exhibit E-1) to effect a
reverse stock split of the issued and outstanding shares of PIA Delaware
Stock on the basis of one of the following ratios; one new share in
exchange for every two issued and outstanding shares, one new share in
exchange for every three issued and outstanding shares, or one new share in
exchange for every four issued and outstanding shares, with the PIA
Delaware Board having the discretion to determine the appropriate ratio to
use immediately prior to effecting the reverse stock split (the "Reverse
Split Proposal" and together with the Charter Amendment, the "Proposed PIA
Certificate of Amendment"), and (iii) has directed that the Proposed PIA
Certificate of Amendment be submitted to PIA Delaware's stockholders at the
PIA Stockholders Meeting (as such term is defined in

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Section 5.01). Upon the approval of the Proposed PIA Certificate of
Amendment by the stockholders of PIA Delaware as required by the DGCL and
the filing thereof with the Secretary of State of the State of Delaware,
the shares of PIA Delaware Stock to be issued in connection with the Merger
will be duly authorized and, when issued as contemplated hereby at and
after the Effective Time, will be validly issued, fully paid and
nonassessable and free of all Restrictions.

(c) The PIA Disclosure Letter sets forth a complete list of all
outstanding rights, subscriptions, warrants, calls, convertible securities,
unsatisfied preemptive rights, options or other agreements or arrangements
of any kind pursuant to which any PIA Company may be required to issue any
of its authorized but unissued capital stock. No PIA Company has any
obligation (contingent or otherwise) to purchase, redeem or otherwise
acquire any outstanding shares of capital stock or to pay any dividend or
make any distribution in respect thereto. The PIA Delaware Board has
approved the adoption of the PIA Special Purpose Plan, a copy of which is
annexed hereto as Exhibit B, pursuant to which the Substitute Options will
be issued as provided in Section 2.04 hereof. The PIA Delaware Board has
also approved an amendment and restatement of the PIA 1995 Stock Option
Plan, a copy of which is annexed hereto as Exhibit F (together with such
changes as may be made therein in accordance with the PIA Delaware Board's
approval, but subject to the consent of the SPAR Parties, the "Proposed
Plan Amendment"), that would (among other things) increase the number of
shares of Common Stock issuable upon the exercise of options granted
thereunder from 1,300,000 shares to 3,500,000 shares, subject to the
consummation of the Merger.

SECTION 4.04. No Violations. Except as otherwise disclosed in the PIA
Disclosure Letter:

(a) The execution, delivery and performance of this Agreement by the
PIA Parties do not and will not violate or result in the breach of any
term, condition or provision of, or require the consent of any other person
under (i) any existing Applicable Law to which any PIA Company is subject,
(ii) any judgment, order, writ, injunction, decree or award of any
Governmental Entity that is applicable to any PIA Company (each a "PIA
Court Order"), (iii) the charter documents of any PIA Company, or (iv) any
PIA Contract, PIA Realty Lease, material PIA Personalty Lease or other
material mortgage, indenture, agreement, contract, commitment, lease,
permit, plan, authorization, instrument or document to which any PIA
Company is a party, by which any PIA Company has any rights or by which any
of the properties or assets of any PIA Company is bound or subject (each a
"Material PIA Document").

(b) The execution, delivery and performance of this Agreement by each
PIA Party (to the extent it is a party thereto) will not be reasonably
likely to result in (A) any termination, cancellation or acceleration of
any Material PIA Document or (B) termination, modification or other change
in any material respect of the existing rights and obligations of any PIA
Party under such Material PIA Document.

(c) No PIA Company, and to the knowledge of each PIA Party, no other
party thereto, is in default in any material respect under any Material PIA
Document, and to the knowledge of each PIA Party, no event has occurred
that with the giving of notice or lapse of time (or both) would constitute
such a default.

(d) Other than the filing of a pre-merger notification report under
the HSR Act and in connection with or in compliance with the provisions of
the Securities Act and the Exchange Act, no authorization, approval or
consent of, and no registration or filing with, any Governmental Entity is
required in connection with the execution and delivery of this Agreement by
any PIA Party and the performance of the transactions contemplated
hereunder .

SECTION 4.05. Financial Statements. Except as otherwise disclosed in the
PIA Disclosure Letter: PIA Delaware has delivered to the SPAR Parties copies of
the consolidated balance sheets of the PIA Companies at December 31, 1998 (the
"PIA Balance Sheet Date"), and December 31, 1997, and the related consolidated
statements of income, cash flows and changes in stockholder's equity for the
fiscal years then ended, together with the report of Deloitte & Touche LLP
thereon (the "PIA Financial Statements"). The PIA Financial Statements have been
prepared in accordance with GAAP consistently applied throughout the periods
involved and fairly present the consolidated financial position and the
consolidated results of operations of the PIA Companies as of the dates and for
the periods indicated.

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SECTION 4.06. Permits. Except as otherwise disclosed in the PIA Disclosure
Letter:

(a) Each PIA Company owns, holds, possesses or lawfully uses in the
operation of its business all governmental franchises, licenses, permits,
easements, rights, applications, filings, registrations and other
authorizations that are necessary for it to conduct its business as now
conducted in all material respects or for the ownership and use of the
material assets owned or used by such PIA Company in the conduct of its
business (each a "PIA Permit" and collectively the "PIA Permits").

(b) Each PIA Permit is valid and in full force and effect and no PIA
Permit will be terminated or impaired in any material respect or become
terminable as a result of the Merger or any other transaction contemplated
by this Agreement.

SECTION 4.07. Real and Personal Property. Except as otherwise set forth in
the PIA Disclosure Letter:

(a) All buildings, leasehold improvements, structures, facilities, and
fixtures used in any material respect by any PIA Company in the conduct of
its business (limited in the case of leased property to the primary demised
premises) (each a "PIA Premises") (i) are leased by a PIA Party pursuant to
a valid lease (each a "PIA Realty Lease" and collectively the "PIA Realty
Leases"), except as may be limited by the Bankruptcy Exceptions, (ii) are
in good operating condition and repair (subject to normal wear and tear,
replacement, retirement, and maintenance), (iii) are usable in the regular
and ordinary course of business, and (iv) used in compliance in all
material respects with all Applicable Laws and authorizations relating to
their construction (limited to tenant improvements in the case of leased
property), use and operation. A list of all PIA Realty Leases is set forth
in the PIA Disclosure Letter. No PIA Company owns any real estate.

(b) All items of equipment and other tangible property and assets used
in any material respect by any PIA Company in the conduct of its business
(i) are either (A) owned by a PIA Company, or (B) leased by a PIA Company
pursuant to a valid lease (each a "PIA Personalty Lease" and collectively
the "PIA Personalty Leases"), except as may be limited by the Bankruptcy
Exceptions, (ii) are in good operating condition and repair (subject to
normal wear and tear, replacement, retirement, and maintenance), (iii) are
usable in the regular and ordinary course of business, and (iv) comply in
all material respects with all Applicable Laws and authorizations relating
to their use and operation. A list of all PIA Personalty Leases is set
forth in the PIA Disclosure Letter.

SECTION 4.08. Contracts and Commitments. The PIA Disclosure Letter sets
forth an accurate, correct and complete list of all material agreements,
contracts, commitments, arrangements and understandings, written or oral,
including all amendments and supplements thereto, of each PIA Company (the "PIA
Contracts"), to which any PIA Company is a party or is bound, or by which any of
their respective assets are bound, and which involve any:

(a) agreement, contract, commitment or other legally binding
arrangement with any present or former (within the past two years) officer,
employee or material consultant involving annual salaries or minimum annual
payments of $100,000 or more (excluding normal salesmen's commissions);

(b) agreement, contract, commitment or other legally binding
arrangement for the future purchase of, or payment for, supplies or
products, or for the performance of services by a third party involving in
any one case $100,000 or more (other than those that may be terminated
without penalty);

(c) agreement, contract, commitment or other legally binding
arrangement to sell or supply products or to perform services involving in
any one case $100,000 or more (other than those that may be terminated
without penalty);

(d) agreement, contract, commitment or other legally binding
arrangement continuing over a period of more than twelve months from the
date hereof and requiring more than $100,000 in annual payments by a PIA
Company;

(e) sales representative, sales agency or similar agreement, contract,
commitment or other legally binding arrangement with any Person not under
the employ, control or direction of a PIA Company;

(f) agreement, contract, commitment or other legally binding
arrangement containing, a provision to indemnify any person or entity or
assume any tax, environmental or other non-ordinary course liability;

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(g) agreement, contract, commitment or other legally binding
arrangement with any Governmental Entity (other than a PIA Permit);

(h) note, debenture, bond, equipment trust agreement, letter of credit
agreement, loan agreement or other contract for the borrowing or lending of
money, or any guarantee, pledge or undertaking of or credit support for the
indebtedness of any other person by any PIA Company;

(i) agreement, contract, commitment or other legally binding
arrangement for any charitable or political contribution;

(j) agreement, contract, commitment or other legally binding
arrangement for any capital expenditure or leasehold improvement in excess
of $100,000;

(k) agreement, contract, commitment or other legally binding
arrangement limiting or restraining: (i) any PIA Company or any successor
thereto from engaging in the businesses of the SPAR Parties or PIA Parties
post Merger (other than any customer contract not in excess of $100,000
that may contain such a prohibition with respect to the performance of
services for the customer's competitors); or (ii) to the knowledge of any
PIA Delaware or PIA California, any employee of any PIA Company from
engaging in or competing with the businesses of the SPAR Parties or PIA
Parties post Merger on behalf of the Parties; or

(l) agreement, contract, commitment or other legally binding
arrangement of any PIA Company not made in the ordinary course of business
(other than as would have been disclosable in one of the preceding clauses
but for the amount or term thereof).

in each case excluding the PIA Realty Leases, the PIA Personalty Leases and this
Agreement (which are not intended, and shall not be deemed or construed, to be
PIA Contracts). Each of the PIA Contracts is valid and enforceable in all
material respects, except as may be limited by the Bankruptcy Exceptions. No PIA
Company is nor has ever been a party to any contract with any Governmental
Entity subject to retroactive price redetermination or renegotiation.

SECTION 4.09. Insurance. Except as otherwise disclosed in the PIA
Disclosure Letter: (a) the assets, properties and operations of each PIA Company
are insured under various policies of general liability, workers' compensation
and other forms of insurance in amounts which are adequate in the judgment of
the PIA Companies in relation to the business and assets of such PIA Company;
(b) all such policies are in full force and effect in accordance with their
terms, no notice of cancellation has been received and to the knowledge of the
PIA Companies with respect to any such policy, and there is no existing default
or event that with the giving of notice or lapse of time (or both) would
constitute a material default under any such policy; and (c) no PIA Company has
been refused any insurance, nor has any Company's coverage been limited, by any
insurance carrier to which it has applied for insurance or with which it has
carried insurance during the past five years.

SECTION 4.10. Employees. Except as otherwise disclosed in the PIA
Disclosure Letter: (a) there have not been in the past five years and, to the
knowledge of the PIA Parties, there are not pending, any organized or
coordinated labor disputes, work stoppages, requests for representation, pickets
or work slow-downs due to labor disagreements; (b) there are and have been no
unresolved material violations of any laws of any Governmental Entity respecting
the employment of any employees; (c) there is no unfair labor practice, charge
or complaint pending, unresolved or, to the knowledge of the PIA Parties,
overtly threatened that would be reasonably likely to be brought or filed with
the National Labor Relations Board or similar body in any foreign country; (d)
the PIA Disclosure Letter describes each collective bargaining agreement which
covers any employees of any PIA Company; and (e) each PIA Company has paid or
properly accrued in accordance with GAAP in the ordinary course of business all
wages and compensation due to employees, including all vacations or vacation
pay, holidays or holiday pay, sick days or sick pay, and bonuses.

SECTION 4.11. Employee Benefit Plans and Arrangements. Except as otherwise
disclosed in the PIA Disclosure Letter:

(a) The PIA Disclosure Letter sets forth a complete and accurate list
of each Benefit Plan covering any present or former officers, employees,
consultants or directors of any PIA Company (a "PIA Benefit

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Plan"). ERISA, Benefit Plan, Welfare Plan, Pension Plan and Commonly
Controlled Entity are defined in Section 3.11.

(b) Each PIA Benefit Plan is in substantial compliance with all
reporting, disclosure and other requirements applicable to such PIA Benefit
Plan. Each PIA Benefit Plan that is a Pension Plan (a "PIA Pension Plan")
and that is intended to be qualified under Section 401(a) of the Code, has
been determined by the Internal Revenue Service to be so qualified and, to
the knowledge of the PIA Parties, no condition exists or has occurred that
would adversely affect any such determination. Neither any PIA Benefit Plan
nor any PIA Company, nor to the knowledge of any PIA Company any Commonly
Controlled Entity of any PIA Company or any trustee or agent of any PIA
Benefit Plan, has been or is presently engaged in any prohibited
transactions as defined by Section 406 of ERISA or Section 4975 of the Code
for which an exemption is not applicable which would be reasonably likely
to subject any PIA Company to a material amount of tax or penalty imposed
by Section 4975 of the Code or Section 502 of ERISA. To the knowledge of
the PIA Companies, there is no event or condition existing that would be
deemed a "reportable event" (within the meaning of Section 4043 of ERISA)
with respect to which the thirty-day notice requirement has not been
waived. To the knowledge of the PIA Parties, no condition exists that would
be reasonably likely to subject any PIA Company to a material amount of
penalty under Section 4071 of ERISA.

(c) Neither any PIA Company nor any Commonly Controlled Entity of any
PIA Company is or has ever been party to any "'multi-employer plan," as
that term is defined in Section 3(37) of ERISA. True and correct copies of
(i) the most recent annual report (Form 5500 series) and any attached
schedules for each PIA Benefit Plan (if any such report was required by
applicable law), (ii) the most recent summary plan description for each PIA
Benefit Plan and (iii) the most recent determination letter issued by the
Internal Revenue Service for each PIA Pension Plan have been provided to
the SPAR Parties.

(d) With respect to each PIA Benefit Plan, there are no actions. suits
or claims (other than routine claims for benefits in the ordinary course or
relating to qualified domestic relations orders within the meaning of
Section 414(p) of the Code) pending or, to the knowledge of the PIA
Parties, overtly threatened against any PIA Benefit Plan, any PIA Company,
any Commonly Controlled Entity of any PIA Company or any trustee or agent
of any PIA Benefit Plan, nor to the knowledge of the PIA Parties is there
any reasonable basis for such claims.

(e) With respect to each PIA Benefit Plan to which any PIA Company or
any Commonly Controlled Entity of any PIA Company is a party which
constitutes a group health plan subject to Section 4980B of the Code, each
such PIA Benefit Plan substantially complies, and in each case has
substantially complied, with all applicable requirements of Section 4980B
of the Code. There is no outstanding material liability (except for
premiums that have not become overdue) or other accrued but unpaid
obligations under Title IV of ERISA with respect to any PIA Pension Plan
and no condition exists that would be reasonably expected to result in any
PIA Company incurring a material liability under Title IV of ERISA, either
directly or with respect to any Commonly Controlled Entity of any PIA
Company. All premiums payable to the PBGC have been paid when due. Neither
the PBGC nor any PIA Company nor any Commonly Controlled Entity of any PIA
Company has instituted proceedings to terminate any PIA Pension Plan that
is subject to Title IV of ERISA and the PBGC has not informed any PIA
Company of its intent to institute proceedings to terminate any such plan.
Full payment has been made of all amounts that any PIA Company or any
Commonly Controlled Entity of any PIA Company was required to have paid as
a contribution to any PIA Pension Plan that is subject to Title IV of ERISA
(with applicability determined as of the last day of the most recent fiscal
year of each of the PIA Pension Plans ended prior to the date of this
Agreement), and none of any PIA Pension Plans has incurred any "accumulated
funding deficiency" (as defined in Section 302 of ERISA and Section 412 of
the Code), whether or not waived, as of the last day of the most recent
fiscal year of each such PIA Pension Plan ended prior to the date of this
Agreement.

(f) To the knowledge of the PIA Parties, the actuarial assumptions
utilized, where appropriate, in connection with determining the funding of
each PIA Pension Plan that is a defined benefit pension plan (as set forth
in the actuarial report for such PIA Pension Plan) are reasonable. Copies
of the most recent

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actuarial reports have been furnished to the SPAR Parties. Based on such
actuarial assumptions, as of the PIA Balance Sheet Date, the fair market
value of the assets or properties held under each such PIA Pension Plan
exceeds the actuarially determined present value of all accrued benefits of
such PIA Pension Plan (whether or not vested) determined on an ongoing
basis. Each PIA Benefit Plan is, and its administration is and at all times
has been in substantial compliance with, and no PIA Company has received
any claim or notice that any such PIA Benefit Plan is not in substantial
compliance with, its terms and all Applicable Laws, including without
limitation, to the extent applicable, the requirements of ERISA and the
Code. No PIA Company and no Commonly Controlled Entity of any PIA Company
is in default in any material respect in performing any of its contractual
obligations under any PIA Benefit Plan or any related trust agreement or
insurance contract. There are no material outstanding liabilities of any
PIA Benefit Plan other than liabilities for benefits to be paid to
participants in such PIA Benefit Plan and their beneficiaries in accordance
with the terms of such PIA Benefit Plan. Each PIA Benefit Plan may be
amended or modified or terminated by the applicable PIA Company or a
Commonly Controlled Entity of a PIA Company at any time without liability
except under any defined pension benefit plan. No PIA Benefit Plan other
than a PIA Pension Plan, retiree medical plan or severance plan provides
benefits to any individual after termination of employment.

(g) The consummation of the transactions contemplated by this
Agreement will not (A) entitle any employee of any PIA Company to severance
pay, unemployment compensation or any other payment or benefit; (B)
accelerate the time of payment or vesting, or increase the amount of
compensation due to any such employee; (C) result in any liability under
Title IV of ERISA; (D) result in any prohibited transaction described in
Section 406 of ERISA or Section 4975 of the Code for which an exemption is
not available; or (E) result (either alone or in conjunction with any other
event) in the payment or series of payments by any PIA Company or any of
its affiliates to any person of an "excess parachute payment" within the
meaning of Section 280G of the Code.

(h) With respect to each PIA Benefit Plan that is funded wholly or
partially through an insurance policy, all material amounts of premiums
required to have been paid to date under the insurance policy have been
paid, all material amounts of premiums required to be paid under the
insurance policy through the Closing Date will have been paid on or before
the Closing Date and, as of the Closing Date, there will be no material
amount of liability of any PIA Company or any Commonly Controlled Entity of
any PIA Company under any insurance policy or ancillary agreement with
respect to such insurance policy in the nature of a retroactive rate
adjustment, loss sharing arrangement or other actual or contingent
liability arising wholly or partially out of events occurring prior to the
Closing Date.

(i) Each PIA Benefit Plan that constitutes a "welfare benefit plan,"
within the meaning of Section 3(i) of ERISA, for which contributions are
claimed by any PIA Company or any Commonly Controlled Entity of any PIA
Company as deductions under any provision of the Code, is in material
compliance with all applicable requirements pertaining to such deduction.
With respect to any welfare benefit fund (within the meaning of Section 419
of the Code) related to a welfare benefit plan, there is no disqualified
benefit (within the meaning of Section 4976(b) of the Code) that would
result in the imposition of a tax under Section 4976(a) of the Code. All
welfare benefit funds intended to be exempt from tax under Section 501(a)
of the Code have been determined by the Internal Revenue Service to be so
exempt and no event or condition exists or has occurred which would
adversely affect any such determination. No PIA Company has any Benefit
Plan outside of the United States.

(j) No PIA Company has any Benefit Plan outside of the United States.

(k) All persons classified by any PIA Company as independent
contractors or leased employees within the meaning of Section 414(n) of the
Code ("PIA Leased Employees") satisfy and have at all times satisfied the
requirements of applicable law to be so classified. Each PIA Company has
fully and accurately reported their compensation on IRS Forms 1099 when
required to do so. No PIA Company has any obligation to provide benefits
with respect to such independent contractors or PIA Leased Employees under
any PIA Benefit Plan or otherwise.

SECTION 4.12. Compliance with Law. Except as otherwise disclosed in the PIA
Disclosure Letter, each PIA Company has complied in all material respects with
each, and is not in violation in any material respect of, any Applicable Law to
which such PIA Company's business, operations, assets or properties are subject.

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SECTION 4.13. Transactions With Affiliates. Except as otherwise disclosed
in the PIA Disclosure Letter, no stockholder and no director, officer or
employee of any PIA Company, or any member of his or her immediate family or any
other of its, his or her affiliates, owns or has a 5% or more ownership interest
in any material business, corporation or other entity that is or was during the
last three years a party to, or in any property which is or was during the last
three years the subject of, any contract, agreement, commitment or legally
binding arrangement with such PIA Company; and (b) the PIA Disclosure Letter
includes a complete list as of the date hereof of all material amounts owed by
any PIA Company to any PIA officer, director (other than salary and expense
reimbursements in the normal course) or affiliate or owed to any PIA Company by
any PIA officer, director or affiliate.

SECTION 4.14. Litigation. Except as otherwise disclosed in the PIA
Disclosure Letter: (a) no litigation, including any arbitration, investigation
or other proceeding of or before any Governmental Entity is pending (or to the
knowledge of the PIA Parties) overtly threatened against any PIA Company, other
than litigation that (i) is not reasonably likely to be adversely determined or
(ii) if reasonably likely to be adversely determined, would not be reasonably
likely to have, individually or in the aggregate with other such litigation, a
PIA Material Adverse Effect; and (b) no PIA Company is a party to or subject to
the provisions of any PIA Court Order.

SECTION 4.15. Taxes. Except as otherwise disclosed in the PIA Disclosure
Letter:

(a) All federal, state, local and foreign tax returns, reports,
statements and other similar filings required to be filed by any PIA
Company (the "PIA Tax Returns") with respect to any Taxes have been timely
filed with the appropriate governmental agencies in all jurisdictions in
which such PIA Tax Returns are required to be filed, and all such PIA Tax
Returns are true, complete and correct in all material respects and
properly reflect the liabilities of the PIA Companies for Taxes for the
periods, property or events covered thereby.

(b) All Taxes, including (without limitation) those called for by the
PIA Tax Returns, required to be paid or withheld by any PIA Company and any
deficiency assessments, penalties and interest for which a notice of
assessment has been received (other than as may have been settled and paid
in full in accordance therewith) and other than those being contested, if
any, as set forth in the PIA Disclosure Letter, have been timely paid or
withheld.

(c) The accruals for Taxes contained in the PIA Financial Statements
for the Tax liabilities of the PIA Companies have been made in accordance
with GAAP as of that date and include adequate provision under GAAP for all
deferred Taxes (other than necessary increments due to the passage of
time).

(d) No PIA Company is or has at any time ever been a party to a Tax
sharing, Tax indemnity or Tax allocation agreement, and no PIA Company has
assumed any Tax liability of any other person or entity under contract. No
PIA Company has received any notice of assessment or proposed assessment in
connection with any PIA Tax Returns other than as may have been settled and
paid in full in accordance therewith, and there are no pending tax
examinations of or material tax claims asserted against any PIA Company or
any of its assets or properties. No PIA Company has extended or waived the
application of, any statute of limitations of any jurisdiction regarding
the assessment or collection of any Taxes. There are now (and as of
immediately, following the Effective Time there will be no liens (other
than any lien for Taxes not yet overdue and payable) on any of the assets
or properties of any PIA Company relating, to or attributable to Taxes. To
the knowledge of the PIA Parties, there is no reasonable basis for the
assertion of any claim relating to or attributable to Taxes that, if
adversely determined, would result in any lien on the assets of any PIA
Company or otherwise have a PIA Material Adverse Effect.

(e) None of the PIA Companies has any knowledge of any reasonable
basis for any additional assessment of any Taxes for any period ending on
or before the Closing Date (other than increased Taxes based upon increased
business units, business sites, payroll, profits or other taxable attribute
relating to an expanding enterprise prior to the Closing Date). All Tax
payments related to employees, including income tax withholding, FICA,
FUTA, unemployment and worker's compensation, required to be made by the
PIA Companies have been fully and properly paid, withheld, accrued or
recorded.

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SECTION 4.16. Intellectual Property Matters. Except as otherwise disclosed
in the PIA Disclosure Letter:

(a) The PIA Disclosure Letter sets forth all patents, trademarks,
trade names, service marks, copyrights, software, material trade secrets or
material know-how owned or used in any material respect by any PIA Company
in the conduct of its business (the "PIA Intellectual Property"),
excluding, however, all Commercial Software, which Commercial Software need
not be set forth on such schedule. All of the PIA Intellectual Property is
owned by or licensed to one of the PIA Companies free and clear of any
liens (except insofar as a license or the restrictions thereunder may
constitute a lien).

(b) There are no ongoing royalty, commission or similar arrangements,
and no licenses, sublicenses or agreements, from any PIA Company as
licensor, pertaining to the current use of the PIA Intellectual Property,
except as may be applicable under the Commercial Software.

(c) No PIA Company infringes upon or unlawfully or wrongfully uses any
patent, trademark, trade name, service mark, copyright or trade secret
owned or claimed by any other person or entity. No action, suit, proceeding
or investigation has been instituted or, to the knowledge of the PIA
Parties, overtly threatened relating to any, patent, trademark, trade name,
service mark, copyright or trade secret formerly or currently used by any
PIA Company. None of the PIA Intellectual Property is subject to any
outstanding order, decree or judgment. No PIA Company has agreed to
indemnify any person or entity for or against any infringement of or by the
PIA Intellectual Property. No present or former employee of any PIA Company
and no other person or entity owns or has any proprietary, financial or
other interest, direct or indirect, in whole or in part, in any patent,
trademark, trade name, service mark or copyright, or in any application
therefor, or in any trade secret, which any PIA Company owns, possesses or
uses in its operations as now or heretofore conducted.

(d) All PIA Intellectual Property in the form of computer software
that is utilized by any PIA Company in the operation of its business is
capable of processing date data between and within the twentieth and
twenty-first centuries or can be rendered capable of processing such data
prior to the date necessary to avoid disruption of its business by
utilizing the employees of one or more of the PIA Companies in the normal
course of business and by expenditure of not more than $100,000 in excess
of the cost of software purchased for reasons other than the failure of
existing software to be capable of such processing.

SECTION 4.17. Existing Condition. Except as otherwise disclosed in the PIA
Disclosure Letter, since the PIA Balance Sheet Date, no PIA Company has:

(a) incurred any liabilities, other than liabilities incurred in the
ordinary course of business consistent with past practice;

(b) discharged or satisfied any lien or encumbrance or paid any
liabilities, other than in the ordinary course of business consistent with
past practice, or failed to pay or discharge when due any liabilities,
other than in the ordinary course of business consistent with past
practice, or where the obligation is being contested in good faith, and the
failure to pay or discharge has not caused and would not be reasonably
likely to cause any PIA Material Adverse Effect;

(c) sold, encumbered, assigned or transferred any assets, properties
or rights or any interest therein, or made any agreement or commitment or
granted any option or right with, of or to any person to acquire any
assets, properties or rights of any PIA Company or any interest therein,
except for sales and dispositions in the ordinary course of business
consistent with past practice and except for the transactions contemplated
under this Agreement;

(d) created, incurred, assumed or guaranteed any indebtedness for
money borrowed, or mortgaged, pledged or subjected any of its assets to any
mortgage, lien, pledge, security interest, conditional sales contract or
other encumbrance of any nature whatsoever other than in the ordinary
course of business (including, without limitation, future advances and
floating liens under existing or replacement credit facilities);

(e) made or suffered any early cancellation or termination of any
Material PIA Document (other than in the ordinary course of business with a
vendor to a PIA Company); or amended, modified or

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waived any substantial debts or claims held by it under any Material PIA
Document other than in the ordinary course of business;

(f) declared, set aside or paid any dividend or made or agreed to make
any other distribution or payment in respect of its capital shares or
redeemed, purchased or otherwise acquired or agreed to redeem, purchase or
acquire any shares of its capital stock or its other ownership interests;

(g) suffered any damage, destruction or loss that has had or will have
(i) a PIA Material Adverse Effect, or (ii) a replacement cost individually
or in the aggregate at more than $100,000;

(h) suffered any repeated, recurring or prolonged shortage, cessation
or interruption of supplies or utility or other services required to
conduct its business and operations;

(i) suffered any material adverse change in the business, operations,
properties, assets or financial condition of the PIA Parties taken as a
whole;

(j) received notice or had knowledge of any actual or overtly
threatened organized or coordinated labor trouble, strike or other similar
occurrence, event or condition of any similar character that has had or
would be reasonably likely to have a PIA Material Adverse Effect;

(k) increased the salaries or other compensation of, or made any
advance (excluding advances for ordinary and necessary business expenses)
or loan to, any of its employees or made any increase in, or any addition
to, other benefits to which any of its employees are entitled (in each case
other than increases in salaries or other compensation in the ordinary
course of business consistent with past practice and that in the aggregate
have not resulted in a PIA Material Adverse Effect);

(l) changed any of the accounting principles followed by it or the
methods of applying such principles;

(m) except as contemplated by this Agreement, entered into any
transaction other than in the ordinary course of business consistent with
past practice;

(n) except as contemplated by this Agreement, changed its authorized
capital or its securities outstanding or otherwise changed its ownership
interests, or granted any options, warrants, calls, conversion rights or
commitments with respect to any of its capital stock or other ownership
interests; or

(o) agreed to take any of the actions referred to above.

SECTION 4.18. Books of Account. Except as otherwise disclosed in the PIA
Disclosure Letter: (a) the books, records and accounts of each PIA Company
accurately and fairly reflect, in reasonable detail, the transactions and the
assets and liabilities of such PIA Company; and (b) no PIA Company has engaged
in any transaction, maintained any bank account or used any of the funds of such
PIA Company except for transactions, bank accounts and funds that have been and
are reflected in the normally maintained books and records of the business.

SECTION 4.19. Environmental Matters. Except as otherwise disclosed in the
PIA Disclosure Letter:

(a) Each PIA Company has secured, and is in compliance in all material
respects with, all Environmental Permits, with respect to any premises on
which its business is operated. Each PIA Company is in compliance in all
material respects with all applicable Environmental Laws.

(b) No PIA Party has (x) received any written communication from any
Governmental Entity that alleges that any PIA Company is not in compliance
in any material respect with any Environmental Laws or Environmental
Permits; (y) entered into or agreed to any court decree or order, and no
PIA Company is subject to any judgment, decree or order, relating to
compliance with any Environmental Law or to investigation or cleanup of a
Hazardous Substance under any Environmental Law in any material respect;
(z) received a CERCLA 104(e) information request or has been named a
potentially responsible party for any National Priorities List site under
CERCLA or any site under analogous state law or received an analogous
notice or request from any non-U.S. Governmental Entity, which notice,
request or any resulting inquiry or litigation has not been fully and
finally resolved without possibility of reopening. No lien, charge,
interest or encumbrance has been attached, asserted, or to the knowledge of
the PIA Parties,

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overtly threatened to or against any assets or properties of any PIA
Company pursuant to any Environmental Law.

(c) To the knowledge of the PIA Companies: (i) there has been no
unlawful treatment, storage, disposal or release of any Hazardous Substance
on any PIA Premises; (ii) there has been no unlawful treatment, storage,
disposal or release of any Hazardous Substance on any PIA Premises; (iii)
there are no aboveground storage tanks located on or underground storage
tanks located within any PIA Premises; (iv) each aboveground storage tank
formerly located on or underground storage tank formerly located within any
PIA Premises (if any) have been removed in accordance with all
Environmental Laws and no residual contamination from any Hazardous
Substance, if any, remains at such sites in excess of applicable standards
under Applicable Law; (v) there are no PCBs leaking from any article,
container or equipment located on or under any PIA Premises and there are
no such articles, containers or equipment containing leaking PCBs; and (vi)
there is no asbestos containing material not contained in a manner
reasonably acceptable under Applicable Law in any material respect located
on or under any PIA Premises.

SECTION 4.20. No Illegal Payments. Except as otherwise disclosed in the PIA
Disclosure Letter: (a) no PIA Company and, to the knowledge of the PIA Parties,
no affiliate, officer, agent or employee of any PIA Company, has directly or
indirectly on behalf of or with respect to any PIA Company during the past five
years, (i) made any unlawful domestic or foreign political contributions, (ii)
made any payment or provided services that were unlawful in any material respect
for such Person to make or provide or for the recipient to receive, (iii)
received any payment or services that were unlawful in any material respect for
the payer to make or provide, or (iv) made any payment to any person or entity,
or agent or employee thereof, in connection with any PIA Contract to induce such
person or entity to enter into such PIA Contract that were unlawful in any
material respect for the payer to make or provide or the recipient to receive;
and (b) no PIA Company has during the past five years (i) had any transactions
or payments not recorded in their accounting books and records in accordance
with GAAP , or (ii) had any off-book bank or cash accounts or "slush funds"
related to any PIA Company.

SECTION 4.21. Brokers. The PIA Disclosure Letter lists all investment
banking fees, finders' fees, brokers' commissions and similar payments which any
PIA Company has paid or will be obligated to pay in connection with the
transactions contemplated by this Agreement.

SECTION 4.22. SEC Filings. PIA Delaware has delivered to the SPAR Parties
true and complete copies of (i) PIA Delaware's Annual Report on Form 10-K for
the fiscal year ended December 31, 1997 (the "PIA 10-K") as filed with the
Securities and Exchange Commission (the "Commission"), (ii) PIA's Quarterly
Reports on Form 10-Q for the quarters ended March 31, 1998, June 30, 1998 and
October 2, 1998, and (iii) PIA's proxy statement relating to the annual meeting
of its stockholders held on May 12, 1998 (collectively, the "PIA SEC Filings").
As of the respective times such documents were filed or, as applicable, became
effective, the PIA SEC Filings did not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.

SECTION 4.23. No Misrepresentation by the PIA Parties. The representations
and warranties of the PIA Parties made or contained in this Agreement (whether
with respect to any PIA Company or otherwise), and the information contained in
the PIA Disclosure Letter and the other certificates, schedules and documents
furnished by or on behalf of any PIA Party in connection with the transactions
contemplated by this Agreement (whether with respect to any PIA Company or
otherwise), do not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein in order to make it, in
the light of the circumstances under which made, not misleading.

SECTION 4.24. Board Action; Opinion of Financial Advisor. The PIA Delaware
Board has unanimously determined that the transactions contemplated by this
Agreement are fair to and in the best interests of PIA Delaware's stockholders
and has resolved to recommend in the PIA Proxy Statement the approval by PIA
Delaware's stockholders of (i) the Share Issuance, (ii) the Proposed PIA
Certificate of Amendment, and (iii) the Proposed Plan Amendment. PIA Delaware
has received the opinion of ING Baring Furman Selz LLC, dated the date of this
Agreement, substantially to the effect that the Exchange Ratio is fair to PIA
Delaware and its stockholders from a financial point of view.

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ARTICLE V

COVENANTS

SECTION 5.01. PIA Proxy Statement; Stockholders Meeting. As promptly as
practicable after the execution of this Agreement, but in no event later than
April 8, 1999, PIA Delaware will file with the Commission preliminary proxy
materials ("Preliminary Proxy Materials") relating to the solicitation of
proxies for a special meeting of PIA Delaware's stockholders (the "PIA
Stockholders Meeting") seeking (among other things) stockholder approval of the
Share Issuance, the Proposed PIA Certificate of Amendment and the Proposed Plan
Amendment. PIA Delaware shall respond promptly to any comments made by the
Commission with respect to such preliminary proxy materials and cause a
definitive proxy statement (the "PIA Proxy Statement") and proxy to be mailed to
its stockholders at the earliest practicable time calling for the PIA
Stockholders Meeting at the earliest practicable time. PIA Delaware shall submit
the Share Issuance, the Proposed PIA Certificate of Amendment and the Proposed
Plan Amendment to its stockholders for approval at the PIA Stockholders Meeting.
The PIA Delaware Board shall recommend in the PIA Proxy Statement the approval
of (i) the Share Issuance, (ii) the Proposed PIA Certificate of Amendment, and
(iii) the Proposed Plan Amendment by its stockholders. Each SPAR Party and each
SPAR Principal will cooperate in the preparation of the PIA Proxy Statement and
shall provide PIA Delaware with all information reasonably requested by PIA
Delaware for inclusion in the PIA Proxy Statement. The PIA Parties and the SPAR
Parties shall use their reasonable best efforts to ensure that the PIA Proxy
Statement is not false or misleading with respect to any material fact, and does
not omit to state any material fact necessary in order to make the statements
therein not misleading. If, at any time prior to the date of the PIA
Stockholders Meeting, any event relating to any PIA Company is discovered by any
PIA Party that should be set forth in a supplement to the PIA Proxy Statement,
such PIA Party will promptly inform the SPAR Parties, and such amendment or
supplement shall be promptly filed with the Commission and disseminated to the
stockholders of PIA Delaware, to the extent required by applicable law. If, at
any time prior to the date of the PIA Stockholders Meeting, any event relating
to any SPAR Party is discovered by any SPAR Party that should be set forth in a
supplement to the PIA Proxy Statement, such SPAR Party will promptly inform PIA,
and such amendment or supplement shall be promptly filed with the Commission and
disseminated to the stockholders of PIA Delaware, to the extent required by
applicable law.

SECTION 5.02. Conduct Prior to the Closing Date.

(a) Except as otherwise contemplated in the SPAR Disclosure Letter, from
and after the date of this Agreement through the Closing Date, each SPAR Party
shall, and shall cause each other SPAR Party to, and each PIA Party shall, and
shall cause each other PIA Company to, use their respective reasonable best
efforts to: (i) conduct their respective businesses in the ordinary course and
consistent in all material respects with past practice; (ii) maintain and
service their respective properties and assets in order to preserve their value
and usefulness in the conduct of their respective business consistent with past
practice and commercially reasonable standards; (iii) keep available the
services of their current employees and agents and maintain their relations and
goodwill with suppliers, customers, distributors and any others with whom or
with which they have business relations; (iv) comply in all material respects
with all laws, ordinances, rules, regulations and orders; and (v) cause all of
the conditions to the consummation of the transactions contemplated by this
Agreement to be satisfied on or prior to the Closing Date.

(b) Without limiting the generality of subsection (a) of this Section, no
PIA Party and no SPAR Party shall, without the prior written consent of SAI in
the case of any proposed action by a PIA Party, or PIA Delaware in the case of
any proposed action by a SPAR Party: (A) enter into any agreement or other
legally binding arrangement with respect to the acquisition or proposed
acquisition of any other corporation, business or entity, whether by means of an
asset purchase, stock purchase, merger or otherwise; (B) except as expressly
contemplated by this Agreement or upon the exercise of stock options outstanding
on the date hereof, issue or agree to issue, any shares of, or rights of any
kind to acquire any shares of its capital stock; (C) increase the compensation
payable or to become payable to any officer or director except in accordance
with employment agreements or benefit plans in effect on the date hereof and
except for increases consistent with past practice; (D) adopt or enter into any
bonus, profit sharing, pension, retirement, deferred compensation, employment or
other payment or employee compensation plan, agreement or arrangement except for
individual employment agreements and arrangements in the ordinary course of
business consistent with past practice; (E) make any

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loan or advance to, or enter into any non-employment contract, lease or
commitment with, any officer or director; (F) assume, guarantee, endorse or
otherwise become responsible for any material obligations of any other
individual, firm or corporation or make any material loans or advances to any
individual, firm or corporation (other than pursuant to existing agreements
disclosed to the other hereunder); (G) modify or amend in any material respect
or take any action to voluntarily terminate any material contract (including,
without limitation, in the case of the SPAR Parties, any amendment to any
agreement related to the MCI Acquisition) or any amendment to the Field Service
Agreement; (H) waive, release, grant or (ii) for transfers of capital stock by
the SPAR Principals to each spouse, child, sibling, lineal descendant or
ancestor whether by blood, marriage or adoption, or anyone related by blood,
marriage or adoption to such individual, each trust, foundation, partnership,
limited liability company or other entity organized for gift or estate planning
or other similar purposes, in each case created principally for the benefit of
one or more of the foregoing persons, and each custodian or guardian of any
property of one or more of the foregoing persons in his capacity as such
custodian or guardian (the "Family Members"), or (iii) transfer any rights of
material value except (i) in the ordinary course of business or as contemplated
under the Reorganization Agreement or this Agreement; (I) transfer, lease,
license, sell, mortgage, pledge, dispose of or encumber any material assets
other than in the ordinary course of business and consistent with past practice;
(J) take any action, other than reasonable and usual actions in the ordinary
course of business and consistent with past practice, with respect to accounting
policies or procedures, except for changes required by GAAP; (K) settle or
compromise any material federal, state, local or foreign income tax proceeding
or audit with respect to such Party; or (L) enter into an agreement to do any of
the foregoing.

SECTION 5.03. Consummation of the SPAR Reorganization Transactions; SPAR
Principal Action. The SPAR Parties shall cause the SPAR Reorganization
Transaction to be consummated no later than the Effective Time, in accordance
with the terms and provisions of the SPAR Reorganization Agreement and shall
cause the SPAR Principals to execute such written consents prior to the mailing
of the PIA Proxy Statement as shall be necessary to approve the SPAR
Reorganization Transactions and the Merger (the "SPAR Stockholder Action").

SECTION 5.04. Access. Each Party (and in the case of the PIA Parties, each
PIA Company) shall give the other Party's officers, employees, counsel,
accountants and other representatives free and full access to and the right to
audit and inspect, during normal business hours with reasonable advance notice,
all of the premises, properties, assets, records, contracts and other documents
relating to such Party or company and shall permit them to consult with the
officers, employees, accountants, counsel and agents of such Party or company
for the purpose of making such investigation as the other Party shall desire to
make; provided, however, that such investigation shall not unreasonably
interfere with any Party's or company's business operations. Each Party (and in
the case of the PIA Parties, each PIA Company) shall furnish to the other Party
all such documents and copies of documents and records and information with
respect to the affairs of such Party or company and copies of any working papers
relating thereto as shall from time to time reasonably request. No information
or knowledge obtained in any investigation by any Party or any of its
representatives or affiliates pursuant to this Section or otherwise shall affect
or be deemed to modify any representation or warranty contained in this
Agreement or the conditions to the obligations of the parties to consummate the
Merger.

SECTION 5.05. Negotiations. Except in the furtherance of the transactions
contemplated hereby, prior to the Closing Date, no PIA Party shall or shall
direct and cause its respective directors, officers, employees, representatives
or agents to, directly or indirectly, initiate, solicit or encourage any
inquiries or the making or implementation of any proposal or offer, with respect
to any merger, acquisition, consolidation, share exchange, business combination
or other transaction involving, or which would result in, (A) the acquisition of
a majority of the outstanding equity securities of any PIA Company, (B) the
issuance by any PIA Company, in a single transaction or a series of related
transactions, of equity securities which would represent upon issuance a
majority of the outstanding equity securities of PIA Party, or (C) the
acquisition of a majority of the consolidated assets of any PIA Company (any
such proposal or offer being hereinafter referred to as an "Acquisition
Proposal"), or engage in any negotiations concerning, or provide any
confidential information or data to, or have any discussions with, any person or
entity relating to an Acquisition Proposal, or otherwise facilitate any effort
or attempt to make or implement an Acquisition Proposal; provided, however, that
nothing contained in this Section shall prohibit the PIA Delaware Board from
exercising their respective fiduciary

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duties by (i) to the extent applicable, complying with Rule 14e-2 promulgated
under the Exchange Act with regard to an Acquisition Proposal, or (ii)
furnishing information to or entering into discussions or negotiations with any
person or entity that makes an unsolicited bona fide Acquisition Proposal.

SECTION 5.06. Press Releases and Other Communications. Except to the extent
required by law or by any listing agreement with the Nasdaq Stock Market, no
Party shall issue any press release or otherwise making any public statement
with respect to any of the transactions contemplated hereby without prior
consultation with the other Parties.

SECTION 5.07. Third Party Approvals. Prior to the Closing, Date, each Party
shall use its best efforts to satisfy any requirement for notice and approval of
the transactions contemplated by this Agreement under all SPAR Material
Documents and all PIA Material Documents.

SECTION 5.08. Notice to Bargaining Agents. Prior to the Closing Date, each
Party shall satisfy any requirement for notice of the transactions contemplated
by this Agreement under any applicable collective bargaining agreement.

SECTION 5.09. Notification of Certain Matters.

(a) Each Party shall give prompt notice to each other Party of (i) the
occurrence or non- occurrence of any event known to such Party which would be
likely to cause any representation or warranty of such Party contained in this
Agreement to be untrue or inaccurate in any material respect at or prior to the
Closing Date, and (ii) any failure of such Party to comply with or satisfy any
covenant, condition or agreement to be complied with or satisfied by such Party
hereunder in any material respect.

(b) Each Party shall have the continuing obligation until the Closing Date
to supplement or amend promptly its Disclosure Letter delivered to the other
Party group with respect to any matter hereafter arising or discovered that, if
existing or known at the date of this Agreement, would have been required to
have been set forth or described in such Disclosure Letter (in each case,
"Amended Disclosure") in order that the corresponding representation or warranty
would not have been untrue in any material respect, which may include
supplemental disclosure to a representation or warranty with respect to which no
disclosure was made previously. Any Amended Disclosure that would constitute a
failure to satisfy the condition precedent set forth in Section 6.02(a), (b) or
(c) or in Section 6.03(a), (b) or (c) shall not be effective unless consented to
in the sole discretion of the other Party group (i.e., by SPAR in the case of a
failure to satisfy Section 6.02(a), (b) or (c) and by PIA Delaware in the case
of a failure to satisfy Section 6.03(a), (b) or (c)). To the extent such consent
is obtained, or to the extent the condition precedent is waived on the Closing
Date, the Amended Disclosure shall be deemed effective.

SECTION 5.10. Closing Net Worth. The SPAR Parties shall use their
reasonable best efforts to ensure that the Closing Net Worth (as such term is
defined in Section 7.01) is not less than the Target Amount (as such term is
defined in Section 7.01(b) hereof).

SECTION 5.11. Post Merger Indemnification of Officers and Directors by
Parties.

(a) For a period of six years following the Closing Date, no PIA Party will
(or will permit any other PIA Company to) and no SPAR Party will, amend, repeal
or limit in any way the provisions limiting the personal liability of any
present or former director, officer, employee or agent (and their respective
heirs and assigns) of any PIA Company or any SPAR Party (the "Indemnified
Parties"), as set forth in the certificate of incorporation or by-laws or such
company or party as of the date of this Agreement. In addition, for a period of
six years following the Closing Date, the PIA Parties shall, and shall cause
each of the other PIA Companies to, indemnify, to the fullest extent permitted
by applicable law, (i) the directors of each PIA Company as of the date of this
Agreement, (ii) any persons who served as directors of any PIA Company prior to
the date of this Agreement, (iii) all officers holding the title of Senior Vice
President or any higher office with any PIA Company as of the date of this
Agreement, in each case from and against any and all amounts for which an
employee may be indemnified under the corporate laws of its state of
incorporation. Without limiting the generality of the foregoing, costs and
expenses (including reasonable attorney's fees and expenses) incurred by such
indemnified person shall be advanced to or on behalf such indemnified person (in
advance of any final disposition of such matter) if such indemnified person (A)
agrees in writing with the indemnitor to repay all such advances in the event
that it is ultimately determined that he or she is not entitled to such

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indemnification hereunder or under applicable law, and (B) furnishes reasonable
documentation with respect to such amounts.

(b) This Section is expressly intended to benefit each of the Indemnified
Parties (each of whom shall be entitled to enforce the provisions of this
Section).

(c) For a period of six years following the Closing Date, the PIA Parties
and the SPAR Parties shall cause to be maintained in effect the current policies
of directors' and officers' liability insurance maintained as of the Closing
Date (or substitute policies with reputable and financially sound carriers of at
least the same coverage and amounts containing terms and conditions which are
not materially less advantageous in the aggregate) with respect to claims
arising from or related to facts or events which occurred at or prior to the
Effective Time; provided, however, that no Party shall be obligated to make
annual premium payments for such insurance to the extent such premiums exceed
150% of the annual premiums paid by such Party as of the date hereof for such
insurance (such 150% amount, the "Maximum Premium"). If such insurance coverage
cannot be obtained at all, or can only be obtained at an annual premium in
excess of the Maximum Premium, such Party shall maintain the most advantageous
policies of directors' and officers' insurance obtainable for an annual premium
equal to the Maximum Premium.

SECTION 5.12. Further Assurances. The SPAR Parties shall at any time after
the Effective Time, upon request, take such further action and execute such
further agreements as may be necessary, desirable or proper to give effect to
the intentions of the parties as set forth in Section 6.03(g), (h), (i), (j),
and (k).

ARTICLE VI

CONDITIONS PRECEDENT

SECTION 6.01. Conditions to Each Party's Obligations. The respective
obligations of each Party hereunder are subject to the satisfaction (or to the
extent permitted by law, the waiver) at or prior to the Closing Date of the
following conditions:

(a) Stockholder Approvals.

(i) The Proposed PIA Certificate of Amendment shall have been
approved at the PIA Stockholders Meeting by the vote of a majority of
the outstanding shares of PIA Delaware Stock as required by Section 242
of the DGCL and the Share Issuance shall have been approved at the PIA
Stockholder Meeting by the vote of a majority of the total votes cast
with respect thereto.

(ii) The Proposed Agreement and Plan Merger shall have been
approved by the vote of a majority of the outstanding shares of PIA
Acquisition as required by Section 92A.120 of the NGCL, and PIA Delaware
(as the sole shareholder of PIA Acquisition) hereby covenants and agrees
that it will vote in favor thereof.

(iii) The Proposed Agreement and Plan Merger shall have been
approved pursuant to the SPAR Principals Action by the vote of a
majority of the outstanding shares of SAI Stock as required by Section
92A.120 of the NGCL.

(b) Filing of the PIA Restated Certificate. The Proposed PIA
Certificate of Amendment shall have been duly filed with the Secretary of
State of the State of Delaware and become effective.

(c) HSR. Any waiting period applicable to the Merger under the HSR Act
shall have expired or been terminated.

(d) Nasdaq Approval. The shares of PIA Delaware Stock issuable in
connection with the Merger as contemplated by this Agreement shall have
been authorized for listing on the Nasdaq Stock Market, upon official
notice of issuance, and the existing shares of PIA Delaware Stock shall
continue to be traded on such market.

(e) No Injunctions. No Governmental Entity shall have enacted, issued,
promulgated, enforced or entered any law, rule, regulation, injunction or
other order (whether temporary, preliminary or permanent) which is in
effect and has the effect of making illegal or otherwise prohibiting the
consummation of the transactions contemplated by this Agreement.

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(f) SPAR Intellectual Property.

(i) SMF, SMS and SIT shall have entered into the Business Manager
Agreement.

(ii) STM shall have received the assignment of the SPAR trademark
registrations in the United States and Canada.

(iii) STM shall have executed the SPAR Trademark Licenses with the
SMS and SIT.

(g) Indemnity Agreement and Indemnity Escrow Agreement. The PIA
Parties and the SPAR Parties shall have executed and delivered the Limited
Indemnification Agreement with the SPAR Principals in substantially in the
form annexed hereto as Exhibit G with respect to the SMS tax litigation and
ADVO matters (the "Limited Indemnification Agreement"); and the Surviving
Corporation, the PIA Parties, the SPAR Marketing Companies and Parker
Chapin Flattau & Klimpl, LLP (the "Indemnity Escrow Agent"), shall have
executed and delivered to the SPAR Principals the Indemnity Escrow
Agreement substantially in the form annexed hereto as Exhibit H (the
"Indemnity Escrow Agreement").

SECTION 6.02. Conditions Precedent to the Obligations of the SPAR
Parties. The obligations of the SPAR Parties hereunder are subject to the
satisfaction (or waiver) on or prior to the Closing Date of the following
conditions:

(a) Representations and Warranties. The representations and warranties
of the PIA Parties contained in this Agreement (other than as contained in
Section 4.17(i) hereof, which is addressed by Section 6.02(c), below) shall
be accurate in all material respects as of the Closing Date (other than as
a result of (i) any proposed or pending transactions described in the PIA
Disclosure Letter and this Agreement or (ii) any adverse change(s) in the
overall economy or in the market segments in which such parties do
business) as though such representations and warranties had been made as of
such time.

(b) Performance of Obligations. All of the terms, covenants and
conditions of this Agreement to be complied with and performed by any PIA
Party on or before the Closing Date shall have been duty complied with and
performed in all material respects.

(c) No Material Adverse Change. Except as previously disclosed in the
PIA Disclosure Letter: no material adverse change in the business,
operations, assets, properties or condition (financial or otherwise) of the
PIA Companies taken as a whole (a "PIA Material Adverse Change") shall have
occurred since December 31, 1998 (other than as a result of adverse
change(s) in the overall economy or in the market segments in which such
parties do business, and with the understanding that the loss of a single
material customer as a result of the announcement of the transactions
contemplated by this agreement shall not constitute a PIA Material Adverse
Change); and since the PIA Balance Sheet Date the PIA Companies (taken as a
whole) shall not have suffered any material uninsured loss or damage to any
of its properties or assets that would be reasonably likely to materially
affect or impair the ability of the PIA Companies to conduct their business
as now conducted or as proposed to be conducted.

(d) Officer's Certificate. A certificate dated the Closing Date and
signed by the President or any Vice President of PIA Delaware shall have
been delivered to the SPAR Parties certifying that the conditions specified
in the foregoing clauses (a), (b) and (c) have been satisfied.

(e) Election of Directors. The members of the PIA Delaware Board shall
have taken all necessary action to cause the PIA Delaware Board and the PIA
California Board, from and after the Effective Time, until duly changed, to
be comprised of seven members and to cause the following persons to be
elected to serve as the members of the PIA Delaware Board and of the PIA
California Board, until the next annual meeting or until their successors
shall have been duly elected and qualified: Robert G. Brown, William H.
Bartels, Patrick W. Collins, one person nominated by PIA Delaware (the "PIA
Nominee") and one person nominated by the SPAR Principals (the "SPAR
Nominee") who is reasonably acceptable to PIA Delaware. The PIA Nominee and
the SPAR Nominee shall be identified prior to the mailing of the PIA Proxy
Statement and named therein. Without limiting the generality of the
foregoing, each member of the PIA Delaware Board and each member of the PIA
California Board who will not continue in such capacity after the Effective
Time, and each member of the Board of

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Directors of each PIA Subsidiary, shall have delivered to the SPAR Parties
a resignation from such Board of Directors dated the Closing Date which
shall become effective at the Effective Time.

(f) Appointment of Officers. The PIA Delaware Board shall have taken
all necessary action to cause the following persons to be appointed to the
offices indicated as of the Effective Time to serve until their successors
shall have been duly elected and qualified:

NAME                                   OFFICE
----                                   ------

Robert G. Brown........  Chairman, Chief Executive Officer and President
William H. Bartels.....  Vice Chairman
Terry R. Peets.........  Vice Chairman
Cathy L. Wood..........  Chief Financial Officer and Executive Vice President
James R. Ross..........  Treasurer

(g) Opinion of Counsel. The SPAR Parties shall have received an
opinion from Riordan & McKinzie, counsel for the PIA Companies, dated the
Closing Date in form and substance reasonably satisfactory to the SPAR
Parties.

(h) Good Standing Certificates. The PIA Parties shall have delivered
to the SPAR Parties certificates, dated as of a date no earlier than five
days prior to the Closing Date, duly issued by the appropriate governmental
authority in each PIA Company's jurisdiction of incorporation and in each
state in which each PIA Company is qualified to do business, showing that
each PIA Party is in good standing and qualified to do business and that
all state franchise and/or income tax returns and taxes for such PIA Party
for all periods prior to the dates of such certificates have been filed and
paid.

SECTION 6.03. Conditions Precedent to the Obligations of the PIA
Parties. The obligations of the PIA Parties hereunder are subject to the
satisfaction (or waiver) on or prior to the Closing Date of the following
conditions:

(a) Representations and Warranties. The representations and warranties
of the SPAR Parties contained in this Agreement (other than as contained in
Section 3.17(i) hereof, which is addressed by Section 6.03(c), below) shall
be accurate in all material respects as of the Closing Date (other than as
a result of any proposed or pending transactions described in the SPAR
Disclosure Letter, this Agreement and the SPAR Premerger Agreements or (ii)
any adverse change(s) in the overall economy or in the market segments in
which such parties do business) as though such representations and
warranties had been made as of such time.

(b) Performance of Obligations. All of the terms, covenants and
conditions of this Agreement to be complied with and performed by any SPAR
Party on or before the Closing Date shall have been duly complied with and
performed in all material respects.

(c) No Material Adverse Change. Except as previously disclosed in the
SPAR Disclosure Letter: no material adverse change in the business,
operations, assets, properties, prospects or condition (financial or
otherwise) of the SPAR Parties taken as a whole (a "SPAR Material Adverse
Change") shall have occurred since December 31, 1998 (other than as a
result of adverse change(s) in the overall economy or in the market
segments in which such parties do business, and with the understanding that
the loss of a single material customer as a result of the announcement of
the transactions contemplated by this agreement shall not constitute a SPAR
Material Adverse Change); and since the Interim SPAR Marketing Balance
Sheet Date the SPAR Parties (taken as a whole) shall not have suffered any
material uninsured loss or damage to their assets and properties that would
be reasonably likely to materially affect or impair the ability of the SPAR
Parties to conduct their business as now conducted or as proposed to be
conducted.

(d) Certificate of the SPAR Parties. A certificate dated the Closing
Date and signed by each SPAR Party shall have been delivered to the PIA
Parties certifying that the conditions specified in the foregoing clauses
(a), (b) and (c) have been satisfied.

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(e) Opinion of Counsel. The PIA Parties shall have received an opinion
from Parker Chapin Flattau & Klimpl, LLP, counsel to the SPAR Parties and
the SPAR Principals, dated the Closing Date, in form and substance
reasonably satisfactory to the PIA Parties.

(f) Good Standing Certificates. The SPAR Parties shall have delivered
to the PIA Parties certificates, dated as of a date no earlier than ten
days prior to the Closing Date (30 days in the case of separate tax
certificates), duly issued by the appropriate governmental authority in
each SPAR Party's state of incorporation and in each state in which each
SPAR Party is qualified to do business, showing that each SPAR Party is in
good standing and qualified to do business and that all state franchise
and/or income tax returns and taxes for such SPAR Party for all periods
prior to the dates of such certificates have been filed and paid.

(g) SPAR Principals' and Parties' Mutual Releases. The SPAR Principals
shall have delivered to the PIA Parties a mutual release dated the Closing
Date releasing each SPAR Party from any and all claims of the SPAR
Principals against each such SPAR Party with respect to matters preceding
the Closing Date.

(h) Transfer of Other Assets. All assets and properties currently used
by any SPAR Party in the conduct of its business that are not owned (in
whole or in part) by, licensed to or leased by a SPAR Party as of the date
of this Agreement (if any) shall have been transferred or assigned to a
SPAR Party without the payment of any consideration therefor, as evidenced
by the certificate of the SPAR Parties and copies of all such assignments
(if any).

(i) Termination of Phantom Stock Plan. PIA Delaware shall have
received evidence reasonably satisfactory to it that the SPAR Phantom Stock
Plan (the "Phantom Plan") has been terminated and that all obligations of
any SPAR Party thereunder have been satisfied in full by the SPAR Parties,
without any further recourse to or liability any SPAR Party or the
Surviving Corporation thereunder.

(j) Termination or Separation of SPAR Benefit Plans. PIA Delaware
shall have received evidence reasonably satisfactory to it that either (at
the option of the SPAR Parties) (i) each SPAR Benefit Plan (A) has been
terminated, or (B) has been modified to exclude any employer other than a
SPAR Party, or (ii) each non- SPAR Party to a SPAR Benefit Plan shall have
entered into a separation, reimbursement and indemnity agreement with such
SPAR Party on terms and provisions reasonably acceptable to PIA Delaware
providing for the eventual exclusion of such person from the applicable
SPAR Benefit Plan.

(k) Termination of Buy-Sell Agreement. The SPAR Principals shall have
amended the Buy-Sell Agreement to terminate its applicability to the stock
of any SPAR Party.

ARTICLE VII

CLOSING NET WORTH; NONSURVIVAL OF REPRESENTATIONS

SECTION 7.01. SPAR Closing Net Worth.

(a) As soon as practicable, but in any event within thirty (30) days
following, the Closing Date, PIA Delaware shall cause Ernst & Young LLP to audit
the books of SAI and its subsidiaries to determine the SPAR Net Worth (as
hereinafter defined) immediately prior to the Merger (the "Closing Net Worth").
"SPAR Net Worth" shall mean the consolidated net worth of SAI and its
subsidiaries, calculated in accordance with generally accepted accounting
principles ("GAAP") consistently applied, excluding (i.e., without taking into
account) (i) up to $300,000 of non-capitalizable merger transaction charges and
other one time expenses, reserves or accruals related to the SPAR Reorganization
Transactions or the Merger, and (ii) any tax accruals and similar adjustments
necessitated by the SPAR Premerger Transaction.

(b) Promptly after such calculation of the Closing Net Worth, the Surviving
Corporation shall deliver to the SPAR Principals written notice of the Closing
Net Worth as so calculated (the "Closing Net Worth Notice"). Following the
delivery of the Closing Net Worth Notice, the SPAR Principals shall have the
right to review the calculation thereof for a period of thirty (30) days after
the delivery of the Closing Net Worth Notice to the SPAR Principals (the "Review
Period"). If, the SPAR Principals do not provide PIA Delaware

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with written objection to the calculation of the Closing Net Worth prior to the
expiration of the Review Period, then, (i) to the extent that the Closing Net
Worth, as set forth in the Closing Net Worth Notice, is greater than one million
four hundred thirty-six thousand dollars ($1,436,000) (the "Target Amount"), no
adjustment will be made, and the SPAR Principals will have no further
obligations hereunder; and (ii) to the extent the Closing Net Worth, as set
forth in the Closing Net Worth Notice, is less than the Target Amount, the SPAR
Principals shall pay to PIA Delaware, within five (5) business days after the
last day of the Review Period, the amount of such shortfall, such payment
obligation to be borne by the SPAR Principals pro rata (44/72 by Mr. Brown and
28/72 by Mr. Bartels), and to be satisfied either (at the election of the SPAR
Principals) (A) by wire transfer of immediately available funds to such account
as PIA Delaware may designate or (B) by corresponding reductions in the loans
owed to the SPAR Principals from SMCI.

(c) If the SPAR Principals provide PIA Delaware with written objection
(which objection shall specify the basis for such objection in reasonable
detail) to the calculation of the Closing Net Worth prior to the expiration of
the Review Period, PIA Delaware and the SPAR Principals shall attempt to resolve
such dispute through good faith negotiations for a period of at least thirty
(30) days (or such longer period as PIA Delaware and the SPAR Principals may
agree). If PIA Delaware and the SPAR Principals cannot resolve such dispute in
such period, then such dispute shall be resolved by an independent nationally
recognized accounting firm which is reasonably acceptable to PIA Delaware and
the SPAR Principals (the "Independent Accounting Firm"). The Independent
Accounting Firm shall make its determination of the Closing Date Net Worth
within thirty (30) days of its selection. The determination made by the
Independent Accounting Firm shall be final and binding on the parties hereto.
The costs of the Independent Accounting Firm shall be borne by PIA Delaware.

SECTION 7.02. Survival of Representations and Warranties. If the Merger
occurs, the representations and warranties made by the parties in this
Agreement, or in any certificate or other instrument delivered pursuant to this
Agreement, shall not survive the Merger, but rather shall terminate at the
Effective Time.

ARTICLE VIII

TERMINATION OF AGREEMENT

SECTION 8.01. Termination. This Agreement may be terminated and the Merger
may be abandoned at any time prior to the Effective Time:

(a) by the mutual written agreement of PIA Delaware and SAI;

(b) by PIA Delaware, on forty eight (48) hours' written notice to SAI,
if there is a breach of any of the representations and warranties of any
SPAR Party (other than as a result of (i) the conduct of their businesses
as permitted and required hereunder, (ii) the culmination of any proposed
or pending transactions described in the SPAR Disclosure Letter, this
Agreement and the SPAR Premerger Agreements, or (iii) any adverse change(s)
in the overall economy or in the market segments in which such parties do
business), or if any SPAR Party fails to comply after notice with any of
its covenants or agreements contained herein, which breaches or failures,
as the case may be, are, in the aggregate, material in the context of the
transactions contemplated by this Agreement and cannot reasonably be
anticipated to be cured within thirty (30) days of the date of such notice;

(c) by SAI, on forty eight (48) hours' written notice to PIA Delaware,
if there is a breach of any of the representations and warranties of any
PIA Party (other than as a result of (i) the conduct of their businesses as
permitted and required hereunder, (ii) the culmination of any proposed or
pending transactions described in the PIA Disclosure Letter and this
Agreement, or (iii) any adverse change(s) in the overall economy or in the
market segments in which such parties do business), or if any PIA Party
fails to comply after notice with any of its covenants or agreements
contained herein, which breaches or failures, as the case may be, are, in
the aggregate, material in the context of the transactions contemplated by
this Agreement and cannot reasonably be anticipated to be cured within
thirty (30) days of the date of such notice;

(d) by PIA Delaware on written notice to SAI, if (i) an Acquisition
Proposal has been made and not withdrawn, (ii) a majority of disinterested
members of the PIA Delaware Board determines in good faith (with the advice
of independent financial advisors and legal counsel) that such Acquisition
Proposal

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is superior for PIA Delaware's stockholders to the transaction contemplated
by this Agreement, (iii) PIA Delaware has notified SAI in writing of the
determination described in clause (ii) above, (iv) at least five (5)
business days have elapsed following receipt by SAI of such written notice
and (taking into account any revised proposal made by SAI since receipt of
such written notice) such Acquisition Proposal remains an Acquisition
Proposal and a majority of the disinterested directors of the PIA Delaware
Board has again made the determination referred to in clause (ii) above,
(v) the PIA Delaware Board concurrently approves, and (vii) PIA Delaware
concurrently enters into a definitive agreement providing for the
implementation of such Acquisition Proposal, subject to the payment by the
PIA Parties of the breakup fee and expense reimbursement as provided below
in Section 8.03;

(e) by either PIA Delaware or SAI, on written notice to the other, if
the Merger shall not have been consummated on or before June 30, 1999;
provided, however, that (i) PIA Delaware may not terminate this Agreement
pursuant to this clause (e) if such failure to consummate the Merger is the
result of a failure to satisfy any of the conditions to the obligation of
the SPAR Parties to effect the Merger set forth in Section 6.02 and (ii)
SAI may not terminate this Agreement pursuant to this clause (e) if such
failure to consummate the Merger is the result of a failure to satisfy any
of the conditions to PIA Delaware's obligation to effect the Merger set
forth in Section 6.03;

(f) by either PIA Delaware or SAI, on written notice to the other, if
a Governmental Entity shall have enacted, issued, promulgated, enforced, or
entered any law, rule, regulation, injunction or other order (whether
temporary, preliminary or permanent) that is in effect and has the effect
of making illegal or otherwise prohibiting the consummation of the
transactions contemplated by this Agreement; and

(g) by SAI or PIA Delaware, if upon a vote at the PIA Stockholders
Meeting, PIA Delaware's stockholders do not approve, (i) the Share Issuance
as required under the Nasdaq Rules or (ii) the Proposed PIA Certificate of
Amendment as required under the DGCL.

SECTION 8.02. Effect of Termination. Except as otherwise provided in
Section 8.03 with respect to any termination by PIA Delaware pursuant to
subsection (d) of Section 8.01, in the event of any termination of this
Agreement pursuant to subsection (a), (d), (e), (f) or (g) or of Section 8.01,
no Party hereto (or any of its directors or officers) shall have any liability
or further obligation to any other Party to this Agreement. In the event of any
termination of this Agreement pursuant to clauses (b) or (c) of Section 8.01,
such termination shall not limit or affect in any way the ability of the
non-breaching Parties to seek damages from the breaching Parties for any breach
of this Agreement.

SECTION 8.03. Breakup Fee. In the event of any termination of this
Agreement pursuant to Section 8.01(d) by PIA Delaware, PIA Delaware shall within
five Business Days pay (or cause to be paid) to the SPAR Parties (a) a breakup
fee equal to the product of (i) 0.035 times (ii) the Value Per Share (as defined
below) times the number of shares of PIA Delaware Stock then outstanding
(without giving effect to any shares of PIA Delaware Stock to be issued in such
transaction), and (b) the amount of the reasonable costs and expenses of the
SPAR Parties and the SPAR Principals incurred in connection with the
preparation, negotiation, execution and performance of this Agreement and all
related instruments and documents and all securities, anti-trust and other
governmental filings, including (without limitation) the reasonable fees,
disbursements and expenses of attorneys, accountants and other professionals,
subject to receipt of appropriate invoices and other documentation therefor.
"Value Per Share" shall mean (A) the cash purchase price per share of PIA
Delaware Stock where all or a majority of the outstanding shares of PIA Delaware
Stock are to be purchased for cash, or (B) in all other cases, the value of each
share of PIA Delaware Stock, as valued in good faith by the Board of Directors
of PIA Delaware (based on the fairness opinion or other valuation furnished to
them by the investment bankers or others providing comfort to the PIA Delaware
Board in connection with the alternative Acquisition Proposal), but in any event
not less than the average of the last sale price for PIA Delaware Stock on the
Nasdaq Stock Market for the five trading days preceding the effective date of
the termination of this Agreement.

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ARTICLE IX

GENERAL

SECTION 9.01. Successors and Assigns; Assignment. Whenever in this
Agreement or any other Merger Document reference is made to any Party or other
person, such reference shall be deemed to include the successors, assigns, heirs
and legal representatives of such person, and, without limiting the generality
of the foregoing, this Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns;
provided that the rights of a Party hereunder may not be assigned without the
consent of the other parties hereto.

SECTION 9.02. No Third Party Rights. The representations, warranties and
other terms and provisions of this Agreement and the other Merger Documents are
for the exclusive benefit of the Parties hereto, and, except as otherwise
expressly provided herein or therein, no other person, including creditors of
any Party hereto, shall have any right or claim against any Party by reason of
any of those terms and provisions or be entitled to enforce any of those terms
and provisions against any Party.

SECTION 9.03. Counterparts. This Agreement may be executed in two or more
counterpart copies of the entire document or of signature pages to the document,
each of which may be executed by one or more of the parties hereto, but all of
which, when taken together, shall constitute a single agreement binding upon all
of the parties hereto.

SECTION 9.04. Expenses. Except as otherwise expressly provided herein,
whether or not the transactions herein contemplated shall be consummated, (i)
the PIA Parties shall pay the fees, expenses and disbursements of the PIA
Parties and their respective agents, representatives, accountants and counsel
incurred in connection with the preparation and negotiation of this Agreement
and the consummation of the transactions contemplated hereby and (ii) the SPAR
Parties shall pay the fees, expenses and disbursements of the SPAR Parties and
the SPAR Principals and their respective agents, representatives, accountants
and counsel incurred in connection with the preparation and negotiation of this
Agreement and the consummation of the transactions contemplated hereby. The PIA
Parties and the SPAR Parties shall each pay one-half of the filing fee required
to be paid in connection with any filings required to be made by any Party under
the HSR Act with respect to the Merger.

SECTION 9.05. Notices. All notices, requests and other communications
hereunder shall be in writing and shall be sent, delivered or mailed as follows:

(a) If to any PIA Party:
Terry R. Peets, President and Chief Executive Officer
PIA Merchandising Services, Inc.
19900 MacArthur Blvd., Suite 900
Irvine, California 92612
Telephone:              (949) 474-3506
Telecopier:             (949) 474-3570
E-Mail:                 Terry.Peets@PIAmerch.com

with a copy to:
James W. Loss, Esq.
Riordan & McKinzie
695 Town Center Drive, Suite 1500
Costa Mesa, CA 92626
Telephone:              (714) 433-2900
Telecopier:             (714) 549-3244
E-Mail:                 jwl@riordan.com

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And a copy to:
Lawrence David Swift, Esq.
Parker Chapin Flattau & Klimpl, LLP
1211 Avenue of the Americas
New York, NY 10036-8735
Telephone:              (212) 704-6147
Telecopier:             (212) 704-6159
E-Mail:                 LDSwift@PCFK.com

(b) If to any SPAR Party:
Robert G. Brown, Chairman and Chief Executive Officer
SPAR Marketing Force, Inc.
303 South Broadway, Suite 140
Tarrytown, New York 10591
Telephone:              (914) 332-4100
Telefax:                (914) 332-0741
E-Mail:                 RBrown@MSN.com

With a copy to:
William H. Bartels, Vice Chairman and Senior Vice President
SPAR Marketing Force, Inc.
303 South Broadway, Suite 140
Tarrytown, New York 10591
Telephone:              (914) 332-4100
Telefax:                (914) 332-0741
E-Mail:                 BBartels@SPARinc.com

with a copy, in either case, to:
Lawrence David Swift, Esq.
Parker Chapin Flattau & Klimpl, LLP
121 1 Avenue of the Americas
New York, NY 10036-8735
Telephone:              (212) 704-6147
Telecopier:             (212) 704-6159
E-Mail:                 LDSwift@PCFK.com

Each such notice, request or other communication shall be given by hand
delivery, by nationally recognized courier service or by telecopier, receipt
confirmed. Each such notice, request or communication shall be effective (i) if
delivered by hand or by nationally recognized courier service, when delivered at
the address specified in this Section (or in accordance with the latest
unrevoked written direction from such Party) and (ii) if given by telecopier,
when such telecopy is transmitted to the telecopier number specified in this
Section (or in accordance with the latest unrevoked written direction from such
Party), and the appropriate confirmation is received.

SECTION 9.06. Governing Law. This Agreement shall be governed by and
construed in accordance with the Applicable Laws pertaining in the State of New
York (other than those laws that would defer to the substantive laws of another
jurisdiction); provided, however, that the approval by the Constituent
Corporations, the Articles of Merger and filing, the effects of the Merger, and
other corporate organization and governance matters pertaining to the
Constituent Corporations shall be governed by and construed in accordance with
the Applicable Laws pertaining in the State of Nevada. Without in any way
limiting the preceding choice of law, the parties intend (among other things) to
thereby avail themselves of the benefit of Section 5-1401 of the General
Obligations Law of the State of New York.

SECTION 9.07. Consent to Jurisdiction, Etc. The Parties each hereby consent
and agree that the Supreme Court of the State of New York for the County of
Westchester and the United States District Court for Westchester County, New
York, and the Superior Court of the County of Orange, California, and the United
States District Court for the Central District of California, each shall have
personal jurisdiction and proper venue with respect to any dispute between the
Parties; provided that the foregoing consent shall not

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deprive any Party of the right to voluntarily commence or participate in any
action, suit or proceeding in any other court having jurisdiction and venue over
the other Parties. In any dispute with the SPAR Parties, the PIA Parties will
not raise, and each hereby expressly waives, any objection or defense to any
such New York jurisdiction as an inconvenient forum. Without in any way limiting
the preceding consents to jurisdiction and venue, the parties intend (among
other things) to thereby avail themselves of the benefit of Section 5-1402 of
the General Obligations Law of the State of New York.

SECTION 9.08. Waiver of Jury Trial. In any action, suit or proceeding in
any jurisdiction, the Parties each hereby expressly waive trial by jury.

SECTION 9.09. Exercise of Rights and Remedies. Except as otherwise provided
herein, no delay of or omission in the exercise of any right, power or remedy
accruing to any Party as a result of any breach or default by any other Party
under this Agreement shall impair any such right, power or remedy, nor shall it
be construed as a waiver of or acquiescence in any such breach or default, or of
any similar breach or default occurring later. No waiver of any single breach or
default shall be deemed a waiver of any other breach or default occurring before
or after such waiver.

SECTION 9.10. Reformation and Severability. In case any provision of this
Agreement shall be invalid, illegal or unenforceable, it shall, to the extent
possible, be modified in such manner as to be valid, legal and enforceable but
so as to most nearly retain the intent of the parties, and if such modification
is not possible, such provision shall be severed from this Agreement, and in
either case, the validity, legality and enforceability of the remaining
provisions of this Agreement shall not in any way be affected or impaired
thereby.

SECTION 9.11. Remedies Cumulative. No right, remedy or election given by
any term of this Agreement shall be deemed exclusive, but each shall be
cumulative with all other rights, remedies and elections available at law or in
equity.

SECTION 9.12. Captions. The headings of this Agreement are inserted for
convenience only and shall not constitute a part of this Agreement or be used to
construe or interpret any provision hereof.

SECTION 9.13. Amendments. This Agreement may be modified or amended only by
a written instrument executed by the SPAR Parties and the PIA Parties.

SECTION 9.14. Entire Agreement. This Agreement, the SPAR Disclosure Letter,
the PIA Disclosure Letter, and the other Merger Documents constitute the entire
agreement and understanding among the parties, and supersede any prior
agreements and understandings, relating to the subject matter of this Agreement
and the other Merger Documents.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.

PIA MERCHANDISING SERVICES, INC.                    SPAR ACQUISITION, INC.
By: /s/ TERRY R. PEETS                         By: /s/ ROBERT G. BROWN
-----------------------------------------
---------------------------------------------              Name: Robert G. Brown
Name: Terry R. Peets                   Title: Chairman, Chief Executive
Title: President and Chief Executive                 Officer and President
Officer

SG ACQUISITION, INC.                        SPAR MARKETING FORCE, INC.
By: /s/ TERRY R. PEETS                         By: /s/ ROBERT G. BROWN
-----------------------------------------
---------------------------------------------              Name: Robert G. Brown
Name: Terry R. Peets                   Title: Chairman, Chief Executive
Title: President and Chief Executive                 Officer and President
Officer

PIA MERCHANDISING CO., INC.                SPAR, INC., A DELAWARE CORPORATION
By: /s/ TERRY R. PEETS                         By: /s/ ROBERT G. BROWN
-----------------------------------------
---------------------------------------------              Name: Robert G. Brown
Name: Terry R. Peets                   Title: Chairman, Chief Executive
Title: President and Chief Executive                 Officer and President
Officer

SPAR/BURGOYNE RETAIL SERVICES, INC.                   SPAR MARKETING, INC.
By: /s/ ROBERT G. BROWN                        By: /s/ ROBERT G. BROWN
-----------------------------------------
---------------------------------------------              Name: Robert G. Brown
Name: Robert G. Brown                  Title: Chairman, Chief Executive
Title: Chairman, Chief Executive                   Officer and President
Officer and President

SPAR INCENTIVE MARKETING, INC.                SPAR MCI PERFORMANCE GROUP, INC.
By: /s/ ROBERT G. BROWN                        By: /s/ ROBERT G. BROWN
-----------------------------------------
---------------------------------------------              Name: Robert G. Brown
Name: Robert G. Brown              Title: Chairman, Chief Executive Officer1
Title: Chairman, Chief Executive
Officer and President

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SPAR TRADEMARKS, INC.               SPAR MARKETING, INC., A NEVADA CORPORATION
By: /s/ ROBERT G. BROWN                        By: /s/ ROBERT G. BROWN
-----------------------------------------
---------------------------------------------              Name: Robert G. Brown
Name: Robert G. Brown                  Title: Chairman, Chief Executive
Title: Chairman, Chief Executive                   Officer and President
Officer and President

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EXHIBIT A

ARTICLES OF MERGER

OF

SG ACQUISITION, INC.
AND

SPAR ACQUISITION, INC.

To the Secretary of State, State of Nevada

Pursuant to the provisions of Chapters 78 and 92A, Nevada Revised Statutes,
the domestic corporations herein named do hereby adopt the following Articles of
Merger.

FIRST: Effective upon the filing of these Articles of Merger, SG
Acquisition, Inc. ("SG Acquisition"), a corporation for profit organized under
the laws of the State of Nevada, shall merge into SPAR Acquisition, Inc. ("SPAR
Acquisition"), a corporation for profit organized under the laws of the State of
Nevada, pursuant to and in accordance with the Agreement and Plan of Merger,
dated as of February 28, 1999 (the "Agreement and Plan of Merger"), made by and
among SPAR Acquisition, SG Acquisition, PIA Merchandising Services, Inc., a
Delaware corporation ("PIA Delaware"), PIA Merchandising Co., Inc., a California
corporation ("PIA California"), SPAR Marketing, Inc., a Delaware corporation
("SMI"), SPAR Marketing, Inc., a Nevada corporation ("SMNEV"), SPAR Marketing
Force, Inc., a Nevada corporation ("SMF"), SPAR, Inc., a Nevada corporation
("SINC"), SPAR/Burgoyne Retail Services, Inc., an Ohio corporation ("SBRS"),
SPAR Incentive Marketing, Inc., a Delaware corporation ("SIM"), SPAR MCI
Performance Group, Inc., a Delaware corporation ("SMCI"), and SPAR Trademarks,
Inc., a Nevada corporation ("STM").

SECOND: SPAR Acquisition is the surviving corporation.

THIRD: The complete, executed Agreement and Plan of Merger is on file at
the office of the registered agent of SPAR Acquisition located at Capitol
Document Services, Inc., 202 South Minnesota Street, Carson City, Nevada 89703
and at 303 South Broadway, Suite 140, Tarrytown, NY 10591.

FOURTH: The said Agreement and Plan of Merger has been adopted by the
unanimous consent of the Board of Directors of each of SG Acquisition and SPAR
Acquisition.

FIFTH: The said Agreement and Plan of Merger was approved by the unanimous
consents of the stockholders of each of SG Acquisition and SPAR Acquisition,
pursuant to the provisions of Chapter 78, Nevada Revised Statutes.

SIXTH: The Articles of Incorporation and By-laws of SPAR Acquisition shall
be the Articles of Incorporation and By-laws of the surviving corporation upon
the effectiveness of the merger herein provided for.

SEVENTH: Each of the issued and outstanding shares of common stock of SG
Acquisition shall be converted into one share of common stock of the surviving
corporation upon the effectiveness of the merger herein provided for.

Executed on this                day of             , 1999.

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SG ACQUISITION, INC.                           SPAR ACQUISITION, INC.

By:                                            By:
--------------------------------------------   --------------------------------------------
Terry R. Peets, President                  Robert G. Brown, President

By:                                            By:
--------------------------------------------   --------------------------------------------
Cathy L. Wood, Secretary                   William H. Bartels, Secretary

STATE OF
SS.:
COUNTY OF

On the   day of           in the year 1999 before me, the undersigned, a
Notary Public in and for said State, personally appeared Terry R. Peets,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his capacity (i.e., as
President), and that by his signature on the instrument, the person upon behalf
of which the individual acted (i.e., SG Acquisition, Inc.), executed the
instrument.

--------------------------------------
(SIGNATURE AND OFFICE OF INDIVIDUAL
TAKING ACKNOWLEDGMENT.)

STATE OF
SS.:
COUNTY OF

On the   day of           in the year 1999 before me, the undersigned, a
Notary Public in and for said State, personally appeared Cathy L. Wood,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his capacity (i.e., as
Secretary), and that by his signature on the instrument, the person upon behalf
of which the individual acted (i.e., SG Acquisition, Inc.), executed the
instrument.

--------------------------------------
(SIGNATURE AND OFFICE OF INDIVIDUAL
TAKING ACKNOWLEDGMENT.)

STATE OF
SS.:
COUNTY OF

On the   day of           in the year 1999 before me, the undersigned, a
Notary Public in and for said State, personally appeared Robert G. Brown,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his capacity (i.e., as
President), and that by his signature on the instrument, the person upon behalf
of which the individual acted (i.e., SPAR Acquisition, Inc.), executed the
instrument.

--------------------------------------
(SIGNATURE AND OFFICE OF INDIVIDUAL
TAKING ACKNOWLEDGMENT.)

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STATE OF
SS.:
COUNTY OF

On the   day of           in the year 1999 before me, the undersigned, a
Notary Public in and for said State, personally appeared William H. Bartels,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his capacity (i.e., as
Secretary), and that by his signature on the instrument, the person upon behalf
of which the individual acted (i.e., SPAR Acquisition, Inc.), executed the
instrument.

--------------------------------------
(SIGNATURE AND OFFICE OF INDIVIDUAL
TAKING ACKNOWLEDGMENT.)

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EXHIBIT B

PIA MERCHANDISING SERVICES, INC.

SPECIAL PURPOSE STOCK OPTION PLAN

SECTION 1. Description and Purpose of this Plan. This is the Special
Purpose Stock Option Plan of PIA Merchandising Services, Inc., a Delaware
corporation (the "Company"). This Plan has been created to provide for the
issuance of substitute options ("Substitute Options") to the holders of
outstanding stock options ("SAI Options") granted by SPAR Acquisition, Inc., a
Nevada corporation ("SAI"), as required by the terms of that certain Agreement
and Plan of Merger dated as of February 28, 1999 by and among the Company, SAI
and certain other parties named therein (the "Merger Agreement"). Substitute
Options granted under this Plan will not qualify as incentive stock options
under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code").

SECTION 2. Issuance of Substitute Options. As required by Section 2.04 of
the Merger Agreement, the Company shall, promptly following the Effective Time
(as such term is defined in the Merger Agreement) execute and deliver to each
holder of an SAI Option, against delivery and cancellation of such SAI Option, a
Substitute Option containing substantially the same provisions as the SAI Option
being canceled, including, without limitation, (i) the same per share exercise
price and (ii) providing for the right to purchase such number of shares of the
Company's common stock ("Common Stock") as shall be equal to the number of
shares of SAI's common stock that such holder was entitled to purchase pursuant
to the SAI Option being surrendered (a "Substitute Option Agreement"). The
persons receiving Substitute Options under this Plan are hereinafter referred to
as the "Participants.") The Company shall have no obligations to issue any
Substitute Options to any Participant prior to the Effective Time. This Plan
shall terminate immediately upon the termination of the Merger Agreement in
accordance with its terms.

SECTION 3. Shares Subject to this Plan. The number of shares of Common
Stock in respect of which Substitute Options may be granted under this Plan is
, subject to adjustment as provided in Section 6 hereof. After
the initial grant of Substitute Options as provided in the Merger Agreement, no
further Substitute Options may be granted under this Plan.

SECTION 4. Administration. This Plan shall be administered by the Board of
Directors of the Company (the "Board"). The Board shall have the exclusive and
binding right to (i) interpret this Plan, (ii) prescribe, amend and rescind
rules relating to this Plan; (iii) authorize any person to execute on behalf of
the Company any instrument required to effectuate the grant of an Substitute
Option; (iv) determine the rights and obligations of Participants under this
Plan; and (v) make all other determinations deemed necessary or advisable for
the administration of this Plan. The good faith interpretation and construction
by the Board of any provision of this Plan or of any Substitute Option shall be
final, conclusive and binding. No member of the Board shall be liable for any
action or determination made in good faith with respect to this Plan or any
Substitute Option.

SECTION 5. Issuance of Common Stock. The Company's obligation to issue
shares of its Common Stock upon exercise of a Substitute Option by any
Participant is expressly conditioned upon the compliance by the Company with any
registration or other qualification obligations with respect to such shares
under any state or federal law or rulings and regulations of any government
regulatory body and the making of such investment representations or other
representations and undertakings by such Participant (or such Participant's
legal representative, heir or legatee, as the case may be) in order to comply
with the requirements of any exemption from any such registration or other
qualification obligations with respect to such shares which the Company in its
sole discretion shall deem necessary or advisable. Such required representations
and undertakings may include representations and agreements that such
Participant (or such Participant's legal representative, heir or legatee) (i) is
purchasing such shares for investment and not with any present intention of
selling or otherwise disposing of such shares and (ii) agrees to have a legend
placed upon the face and reverse of any certificates evidencing such shares (or,
if applicable, an appropriate data entry made in the ownership records of the
Company) setting forth (A) any representations and undertakings which such
Participant has given to the Company or a reference thereto, and (B) that, prior
to effecting any sale or other disposition of any such shares, such Participant
must furnish to the Company an opinion of counsel,

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satisfactory to the Company and its counsel, to the effect that such sale or
disposition will not violate the applicable requirements of state and federal
laws and regulatory agencies; provided, however, that any such legend or data
entry shall be removed when no longer applicable. The Company, during the term
of this Plan, will at all times reserve and keep available, and will use its
reasonable efforts to obtain from any regulatory body having jurisdiction any
requisite authority in order to issue and sell such number of shares of Common
Stock as shall be sufficient to satisfy the requirements of this Plan. The
inability of the Company to obtain, from any regulatory body having
jurisdiction, authority reasonably deemed by the Company's counsel to be
necessary for the lawful issuance and sale of any shares hereunder shall relieve
the Company of any liability in respect of the non-issuance or sale of such
shares as to which such requisite authority shall not have been obtained.

SECTION 6. Adjustments Upon Capitalization and Corporate Changes. If the
outstanding shares of the Common Stock are changed into, or exchanged for, a
different number or kind of shares or securities of the Company through
reorganization, merger, recapitalization or reclassification, or if the number
of outstanding shares is changed through a stock split, stock dividend, stock
consolidation or like capital adjustment, or if the Company makes a distribution
in partial liquidation or any other comparable extraordinary distribution with
respect to its Common Stock, an appropriate adjustment shall be made by the
Board in the number, kind or exercise price of shares with respect to which
unexercised Substitute Options have been granted; provided, however, that in no
event shall the exercise price be less than the par value of the Common Stock at
such time. In making such adjustments, or in determining that no such
adjustments are necessary, the Board may rely upon the advice of counsel and
accountants to the Company, and the good faith determination of the Board shall
be final, conclusive and binding.

SECTION 7. Rights as a Stockholder. A Participant shall have no rights as a
stockholder with respect to any shares covered by a Substitute Option until the
date of an entry evidencing such ownership is made in the stock transfer books
of the Company (the "Exercise Date"). Except as otherwise provided in Section 6,
no adjustment shall be made for dividends (ordinary or extraordinary, whether in
cash, securities or other property) or distributions or other rights for which
the record date is prior to the Exercise Date. Upon (i) the dissolution,
liquidation or sale of all or substantially all of the business, properties and
assets of the Company, (ii) upon any reorganization, merger or consolidation in
which the Company does not survive, (iii) upon any reorganization, merger,
consolidation or exchange of securities in which the Company does survive and
any of the Company's stockholders have the opportunity to receive cash,
securities of another corporation and/or other property in exchange for their
capital stock of the Company, or (iv) upon any acquisition by any person or
group (as defined in Section 13(d) of the Securities Act of 1934) of beneficial
ownership of more than fifty percent (50%) of the Company's then outstanding
shares of Common Stock (each of the events described in clauses (i), (ii), (iii)
or (iv) is referred to herein individually as an "Extraordinary Event"), this
Plan and each outstanding Substitute Option shall terminate. In such event each
Participant shall have the right until 10 days before the effective date of the
Extraordinary Event to exercise, in whole or in part, any unexpired Substitute
Option held by such Participant to the extent that such Substitute Option is
then vested and exercisable pursuant to the provisions thereof.

SECTION 8. Withholding of Taxes. The Company, or a Subsidiary, as the case
may be, may deduct and withhold from the wages, salary, bonus and other income
paid by the Company or such Subsidiary to any Participant the requisite tax upon
the amount of taxable income, if any, recognized by such Participant in
connection with the exercise in whole or in part of any Substitute Option, or
the sale of Common Stock issued to any Participant upon the exercise of any
Substitute Option, as may be required from time to time under any federal or
state tax laws and regulations. This withholding of tax shall be made from the
Company's (or such Subsidiary's) concurrent or next payment of wages, salary,
bonus or other income to such Participant or by payment to the Company (or such
Subsidiary) by such Participant of the required withholding tax, as the Board
may determine.

SECTION 9. Amendment of this Plan. The Board may (a) make such changes in
the terms and conditions of outstanding Substitute Options as it deems
advisable, provided each Participant adversely affected by such change consents
thereto, and (b) make such amendments to this Plan as it deems advisable. The
Board may obtain shareholder approval of any amendment to this Plan for any
reason (including in order to take advantage of certain exemptions under Code
Section 162(m)), but shall not be required to do so

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unless required by law or by the rules of the Nasdaq National Market or any
stock exchange on which the Common Stock may then be listed.

SECTION 10. Governing Law. This Plan and any Substitute Option granted
pursuant to this Plan shall be construed under and governed by the laws of the
State of Delaware without regard to conflict of law provisions thereof.

SECTION 11. Not an Employment or Other Agreement. Nothing contained in this
Plan or in any Substitute Option Agreement shall confer, intend to confer or
imply any rights of employment or any rights to any other relationship or rights
to continued employment by, or rights to a continued consulting relationship
with, the Company or any Subsidiary in favor of any Participant or limit the
ability of the Company or any Subsidiary to terminate, with or without cause, in
its sole and absolute discretion, the employment of, or relationship with, any
Participant, subject to the terms of any written employment or other agreement
to which such Participant is a party.

SECTION 12. Indemnification. In addition to such other rights of
indemnification as they may have as directors, the members of the Board shall be
indemnified by the Company to the fullest extent permitted by law against the
reasonable expenses, including reasonable attorneys' fees, actually and
necessarily incurred in connection with the defense of any action, suit or
proceeding, or in connection with any appeal therein, to which they or any of
them may be a party by reason of any action taken or failure to act under or in
connection with this Plan or any Substitute Option granted hereunder, and
against all amounts paid by them in satisfaction of a judgment in any such
action, suit or proceeding, except in relation to matters as to which it shall
be adjudged in such action, suit or proceeding that such Board member is not
entitled to indemnification under applicable law.

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EXHIBIT C

TRADEMARK LICENSE AGREEMENT

INTRODUCTION

This Trademark License Agreement, dated as of                            ,
1999 (as the same may be supplemented, modified, amended, restated or replaced
from time to time in the manner provided herein, this "Agreement"), is by and
between SPAR Infotech, Inc., a Nevada corporation currently having an address at
303 South Broadway, Suite 140, Tarrytown, New York 10591(the "Licensee"), and
SPAR Trademarks, Inc., a Nevada corporation currently having an address at 303
South Broadway, Suite 140, Tarrytown, New York 10591 (the "Licensor"). The
Licensor and the Licensee are sometimes referred to herein individually as a
"Party" and collectively as the "Parties".

RECITALS

The Licensor is the owner of the Trademarks (as these and the other
capitalized terms used in these Recitals are defined in Section 1, below) with
respect to the Products and Services, amd the Licensee desire to use the
Trademarks in the Territory in connection with the Products and Services. The
Licensor is willing to grant to the Licensee the nonexclusive right and license
to use the Trademarks on and in connection with the Products and Services in the
Territory, all upon the terms and provisions and subject to the conditions set
forth in this Agreement.

AGREEMENT

In consideration of the foregoing, the mutual covenants and agreements
hereinafter set forth, and other good and valuable consideration (the receipt
and adequacy of which is hereby acknowledged by the Parties), the Parties hereto
hereby agree as follows:

SECTION 1. Definitions. Each use in this Agreement of a neuter pronoun
shall be deemed to include references to the masculine and feminine variations
thereof, and vice versa, and a singular pronoun shall be deemed to include a
reference to the plural variation thereof, and vice versa, in each case as the
context may permit or require. As used in this Agreement, the following
capitalized terms and non-capitalized words and phrases shall have the meanings
respectively assigned to them below, which meanings shall be applicable equally
to the singular and plural forms of the terms so defined:

(a) "Business Competitive With the Licensee" shall mean any
substantial business activity in collecting, analyzing and/or disseminating
scanner data, ex-factory shipment data and/or other similar information.

(b) "Business Competitive With Marketing Force" shall mean any
substantial business activity conducted by any person that is competitive
with any substantial business activity conducted by any SPAR Company or PIA
Company at the Merger Effective Time (whether or not such person's activity
is actually conducted in competition with any SPAR Company or PIA Company),
excluding, however, any Business Competitive With the Licensee (whether or
not so conducted by any SPAR Company or PIA Company).

(c) "Merger Effective Time" shall mean the "Effective Time" under (and
as defined in) the Agreement and Plan of Merger dated as of February 28,
1999, among the SPAR Companies and the PIA Companies (which is the time the
merger thereunder takes effect and the SPAR Companies and PIA Companies
come under common control), as the same may be supplemented, modified,
amended, restated or replaced from time to time in the manner provided
therein.

(d) "PIA Company" and "PIA Companies" shall respectively mean any one
or more of PIA Merchandising Services, Inc., a Delaware corporation, SG
Acquisition, Inc., a Nevada corporation (which is merging into SPAR
Acquisition, Inc.), PIA Merchandising Co., Inc., a California corporation,
and their respective subsidiaries as of the Merger Effective Time.

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(e) "Products" shall mean the products claimed in the registrations
for the Trademarks listed in Exhibit A hereto and any other products for
which the Licensor has such Trademark rights.

(f) "Representative" of any Party shall mean any of its directors,
officers, employees, attorneys, heirs, executors, administrators, or
agents, any of such Party's sublicensees, affiliates, successors and
assigns, or any of their respective directors, officers, employees,
attorneys, heirs, executors, administrators, or agents.

(g) "Services" shall mean the services claimed in the registrations
for the Trademarks listed in Exhibit A hereto and any other services for
which the Licensor has such Trademark rights.

(h) "SPAR Company" and "SPAR Companies" shall respectively mean any
one or more of SPAR Acquisition, Inc., a Nevada corporation, SPAR
Marketing, Inc., a Delaware corporation, SPAR Marketing, Inc., a Nevada
corporation, SPAR Marketing Force, Inc., a Nevada corporation, SPAR, Inc.,
a Nevada corporation, SPAR/Burgoyne Retail Services, Inc., an Ohio
corporation, SPAR Incentive Marketing, Inc., a Delaware corporation, SPAR
MCI Performance Group, Inc., a Delaware corporation, and SPAR Trademarks,
Inc., a Nevada corporation.

(i) "Territory" shall mean the United States and Canada.

(j) "Trademark" and "Trademarks" shall respectively mean any and all
of the registered trademarks of the Licensor registered in the United
States and Canada listed in Exhibit A hereto, any additional registered
trademarks of the Licensor deriving or containing any Trademark, and any
and all renewals thereof.

SECTION 2. Grant of License and Affiliate Sublicenses; Limits on Use.

(a) License. Subject to the terms and conditions herein contained, the
Licensor hereby grants to the Licensee a royalty-free, nonexclusive license to
use: (i) the Trademarks (alone or as part of other words or phrases) on and in
connection the Products and Services in the Territory; and (ii) to the extent
the Licensor has any right, title or interest therein, the name "SPAR" (alone or
as part of other words or phrases) in its legal and/or trade name and on or in
connection with any products or services other than the Products and Services.

(b) Sublicenses. The Licensee from time to time may add one or more
subsidiaries or affiliates (but only those under common ownership and control
with the Licensee) as a sublicensee under this Agreement (each a "Sublicensee"
and collectively "Sublicensees"). Each Sublicensee hereby assumes and agrees to
be bound by the terms, provisions and conditions as set forth in this Agreement
as if it were the "Licensee" and a "Party" hereunder. In the event the control
or ownership of any Sublicensee, its business or substantially all of its assets
are sold or transferred so that such Sublicensee, business or assets cease to be
under common ownership and control with the Licensee, such subsidiary or
affiliate shall automatically cease to be a Sublicensee hereunder from and after
such sale or transfer, without, however, relieving or otherwise affecting any of
the obligations of such former Sublicensees with respect to its obligations with
respect to actions or events arising prior to such sale or transfer.

(c) License May Follow Group Sale. In the event that the control or
ownership of all or substantially all of the Licensee and Sublicensees or all or
substantially all of their businesses or assets are sold or transferred (a
"Group Sale"), this Agreement may be transferred (in whole) as part of such
Group Sale by written notice to the Licensor and (if an asset sale) the
assumption of this Agreement by the purchasers by the delivery to the Licensor
of an assumption agreement in form and substance reasonably acceptable to the
Licensor, duly executed by the new Licensee; provided, however, that this
Agreement may not be so transferred to anyone whose business is in any material
respect a Business Competitive With Marketing Force. Any entity not included in
the Group Sale shall automatically cease to be a Licensee or Sublicensee
hereunder from and after such sale or transfer, without, however, relieving or
otherwise affecting any of its obligations with respect to actions or events
arising prior to such sale or transfer.

(d) Limits on the Licensee's Use of Trademarks. Neither the Licensee nor
any of its Sublicensees shall use any Trademark in any material respect in any
Business Competitive With Marketing Force.

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(e) No Unpermitted Users. No Party shall cause, suffer, or permit any of
its affiliates or cause any other person to use any Trademark in any material
respect unless such person is a permitted Licensee or Sublicensee hereunder.

SECTION 3. Term. The term of this Agreement shall commence on the date of
this Agreement and continue through December 31, 2098 (as and if extended
pursuant to this Section, the "Term"). The Term of this Agreement is
automatically renewable for additional consecutive ninety-nine year terms. If
the Licensee (in the Licensee's sole and absolute discretion) chooses not to
renew, a written request from the Licensee seeking termination must be received
by the Licensor at least 90 days prior to the scheduled end of the then current
Term. The Term is also subject to earlier termination as provided in this
Agreement. Upon the termination of this Agreement by the Licensee, (i) the right
and license to use the Trademarks granted to the Licensee hereunder shall
forthwith terminate, (ii) the Licensee shall promptly thereafter shall cease and
desist from using the marks on or in connection with the Products or Services,
and (iii) the Licensee shall, promptly upon receipt of the written request of
the Licensor, without charge, execute any and all documents, and record them
with any and all appropriate governmental agencies within the Territory, as may
be necessary to remove the Trademarks from its company name and to otherwise
reasonably evidence that the Licensee no longer has the right and license to use
the Trademarks; provided, however, that upon such termination of this Agreement,
the Licensee shall have the right to continue to sell any existing inventory of
the Products and to use the Trademarks in connection with such sale for a period
of up to three months after the effective date of termination of this Agreement.

SECTION 4. Non-Exclusivity of License; Limits on Licensor's Use and
Licensing Rights: Validity of Trademarks.

(a) Retained Rights and Limits on Use. The Licensee acknowledges and agrees
that, all rights in the Trademarks, other than those specifically granted in
this Agreement, are reserved by the Licensor, and the Licensor may (during the
Term or thereafter) specifically grant other licenses to use the Trademarks on
or in connection with (i) any one or more of the Products and Services within or
outside the Territory or (ii) any other products or services within or outside
the Territory to the extent it has rights therein; provided, however, that the
Licensor covenants and agrees that neither the Licensor nor any of its
affiliates (as sublicensees or otherwise) shall (A) use any Trademark in any
material respect in any Business Competitive With the Licensee, or (B) license
or otherwise grant any rights in or to any Trademark to any person whose
business is in any material respect a Business Competitive With the Licensee.

(b) Ownership and Validity of Trademarks. The Licensee acknowledges and
agrees that the Licensor is the legal, valid and exclusive owner of the
Trademarks. The Licensee covenants and agrees that it will not, individually or
with any other licensee or person, at any time during the term of this Agreement
or thereafter, directly or indirectly, challenge, contest or aid in challenging
or contesting (i) the legality or validity of any of the Trademarks, (ii) the
ownership by the Licensor of any of the Trademarks, or (iii) the title of or
registration by the Licensor of any of the Trademarks, in each case whether such
Trademarks are now existing or hereafter acquired, created or obtained and all
renewals thereof.

SECTION 5. Compliance with Applicable Law. The Licensee covenants and
agrees with the Licensor that, during the Term of this Agreement, unless the
Licensor (in its sole and absolute discretion) consents otherwise in writing,
the Licensee shall comply with all applicable laws, rules, regulations and
ordinances in effect at any time and from time to time in the Territory in
connection with the Products and Services utilizing any of the Trademarks if the
non-compliance therewith would materially impair the prestige and goodwill of
the Trademarks.

SECTION 6. Standards of Quality. The Licensee acknowledges to and covenants
and agrees with the Licensor that, during the Term of this Agreement, unless the
Licensor (in its sole and absolute discretion) consents otherwise in writing:
(a) none of the Products or Services shall fail in any material respect to meet
the standards of quality with respect to the Trademarks in place at the time of
commencement of this Agreement ("Standards of Quality") if such failure would
materially impair the prestige and goodwill of the Trademarks; and (b) none of
the Products or Services of the Licensee shall otherwise materially impair the
prestige and goodwill of the Trademarks.

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SECTION 7. Registration for the Trademarks in the Territory.

(a) Registration Maintenance During the term of this Agreement The Licensor
shall undertake, in its own name, to renew and maintain registration for the
Trademarks in the Territory. The Licensee shall cooperate with the Licensor in
the execution, filing and prosecution of any such instrument(s) or document(s)
as the Licensor from time to time may reasonably request (i) to obtain renewal
and/or maintain registration for the Trademarks in the Territory and (ii) to
confirm the Licensor's ownership rights therein. The Licensor makes no
representation or warranty hereby that the registrations for the Trademarks will
be renewable or maintainable in the Territory, and the failure to renew or
maintain the registrations thereof shall not be deemed a breach hereof by the
Licensor.

(b) Costs and Expenses. Any and all costs and expenses (including, without
limitation, the fees and expenses of attorneys and other professionals) incurred
by the Licensor in the renewal or maintenance of any of the Trademarks in the
Territory shall be borne by the Licensor.

SECTION 8. Royalties. The license granted under this Agreement is
royalty-free. The Licensee shall not be required to account to the Licensor with
respect to its use of the Trademarks.

SECTION 9. Representations and Warranties Respecting the Licensee. The
Licensee represents and warrants to the Licensor that, as of the date hereof and
as of the date of each amendment, renewal or extension hereof or assumption
hereof, except as otherwise disclosed to the Licensor in writing: (a) the
Licensee is a corporation duly incorporated, validly existing and in good
standing under the laws its state of incorporation; (b) the Licensee has the
legal capacity, power, authority and unrestricted right to execute and deliver
this Agreement and to perform all of its obligations hereunder; (c) the
execution and delivery by the Licensee of this Agreement and the performance by
the Licensee of all of its obligations hereunder will not violate or be in
conflict with any term or provision of (i) any applicable law, (ii) any
judgment, order, writ, injunction, decree or consent of any court or other
judicial authority applicable to the Licensee or any material part of the
Licensee's assets and properties, (iii) any of its organizational documents, or
(iv) any material agreement or document to which it is a party or subject or
that applies to any material part of the Licensee's assets and properties; (d)
no consent, approval or authorization of, or registration, declaration or filing
with, any governmental authority or other person is required as a condition
precedent, concurrent or subsequent to or in connection with the due and valid
execution, delivery and performance by the Licensee of this Agreement or the
legality, validity, binding effect or enforceability of any of the terms and
provisions of this Agreement; and (e) this Agreement is a legal, valid and
binding obligation of the Licensee, enforceable against the Licensee in
accordance with its terms and provisions.

SECTION 10. Representations and Warranties Respecting the Licensor. The
Licensor represents and warrants to the Licensee that, as of the date hereof and
as of the date of each amendment, renewal or extension hereof or assumption
hereof, except as otherwise disclosed to the Licensee in writing: (a) the
Licensor is a corporation duly incorporated, validly existing and in good
standing under the laws its state of incorporation; (b) the Licensor has the
legal capacity, power, authority and unrestricted right to execute and deliver
this Agreement and to perform all of its obligations hereunder; (c) the
execution and delivery by the Licensor of this Agreement and the performance by
the Licensor of all of its obligations hereunder will not violate or be in
conflict with any term or provision of (i) any applicable law, (ii) any
judgment, order, writ, injunction, decree or consent of any court or other
judicial authority applicable to the Licensor or any material part of the
Licensor's assets and properties, (iii) any of its organizational documents, or
(iv) any material agreement or document to which it is a party or subject or
that applies to any material part of the Licensor's assets and properties; (d)
no consent, approval or authorization of, or registration, declaration or filing
with, any governmental authority or other person is required as a condition
precedent, concurrent or subsequent to or in connection with the due and valid
execution, delivery and performance by the Licensor of this Agreement or the
legality, validity, binding effect or enforceability of any of the terms and
provisions of this Agreement; (e) this Agreement is a legal, valid and binding
obligation of the Licensor, enforceable against the Licensor in accordance with
its terms and provisions; (f) the Licensor is the registered, legal and
beneficial owner of the Trademarks; (g) the Licensor has full power and
authority and the unrestricted right to grant the licenses contemplated
hereunder; (h) the license of the Tradmarks hereunder is made free and clear of
any and all liens or encumbrances; (i) the Trademark registrations are in full
force and effect; and (j) the Licensor has no knowledge of any infringements or
competing claims with respect to any Trademark.

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SECTION 11. Termination.

(a) Termination for Cause. The Licensor shall have the right to terminate
this Agreement (and the licenses and other rights, remedies and interests
granted to the Licensee hereunder), and end the Term, by written notice to the
Licensee in the event the Licensee shall default in the performance or
satisfaction of any of the terms and provisions of this Agreement, which
violation or failure shall have continued for more than thirty (30) days after
notice thereof by the Licensor to the Licensee and which violation or failure
has materially impaired the prestige and goodwill of the Trademarks, provided,
however, that if such default is capable of being cured and if the Licensee
shall have commenced to cure such default within such period and shall proceed
continuously in good faith and with due diligence to cure such default, then
such thirty day period shall instead be such longer period as may be reasonably
necessary to effect such cure (not to exceed 180 days).

(b) Termination Without Prejudice; Certain Continuing Provisions. The
termination of this Agreement (and the licenses and other rights, remedies and
interests granted to the Licensee hereunder), for any reason, shall be without
prejudice to any other right or remedy the Licensor may have, including (without
limitation) the right of the Licensor to recover from the Licensee any and all
(i) damages to which it may be entitled by reason of the happening of the event
giving rise to such termination or any other event and (ii) reimbursements,
indemnifications and other amounts that remain unsatisfied by the Licensors
hereunder, which rights and remedies all shall survive any such termination
hereunder. In addition, the terms and provisions of this subsection and Sections
12 through 21 hereof shall survive any such termination hereunder.

SECTION 12. Infringement.

(a) Defense of Infringements. In the event that legal proceeding shall be
instituted by any third party with respect to the alleged infringement by the
Trademarks on the rights of any third party, the Licensor shall have the right,
at its option and expense and either in its name, in the name of the Licensee,
or in the name of both the Licensor and the Licensee, to be represented by
counsel selected by the Licensor, and to defend against, negotiate, settle or
otherwise deal with such proceeding. The Licensee may participate in or (if the
Licensor elects not to do so) defend any such proceeding at its own cost and
expense (subject to reimbursement by the Licensor of reasonable costs and
expenses if the Licensee prevails in such proceeding) and with counsel of its
choice; provided, however, that if the Licensor defends the proceeding, the
Licensor shall control such proceeding. The Licensee shall not settle such
proceeding, or any claim or demand, admit liability or take any action with
respect thereto without the prior written consent of the Licensor, which shall
not be unreasonably withheld.

(b) No Liability for Continuing Unauthorized Use. If any of the Trademarks
shall be declared by a court of competent jurisdiction to be an infringement on
the rights of any third party so that the Licensee may not thereafter continue
in the use thereof, or if the Licensee shall unlawfully use any of the
Trademarks after the Term, the Licensor shall not be liable to the Licensee or
any other person or entity for any damages or otherwise as a result of
continuing use by the Licensee after such declaration or the end of the Term.

(c) Notice and Prosecution of Infringement. The Licensee shall promptly
notify the Licensor of any infringement, counterfeiting or passing-off of any of
the Trademarks of which it has actual knowledge, whether by the use of any of
the Trademarks or otherwise, but shall not take any action, legal or otherwise,
with respect to such infringement, counterfeiting or passing-off without prior
notice to the Licensor. In the event that the Licensee deems legal proceedings
to be reasonably necessary to enjoin any third party with respect to the alleged
infringement, counterfeiting or passing-off of any of the Trademarks, the
Licensor shall have the right, at its option and expense and either in its name,
in the name of the Licensee, or in the name of both the Licensor and the
Licensee, to be represented by counsel selected by the Licensor, and to
prosecute, negotiate, settle or otherwise deal with such proceeding. The
Licensee may participate in or (if the Licensor elects not to do so) prosecute
any such proceeding at its own cost and expense (subject to reimbursement by the
Licensor of reasonable costs and expenses if the Licensee prevails in such
proceeding) and with counsel of its choice; provided, however, that if the
Licensor prosecutes the proceeding, the Licensor shall control such proceeding.
The Licensee shall not settle such proceeding, or any claim or demand, release
any liability or take any action with respect thereto without the prior written
consent of the Licensor, which shall not be unreasonably withheld.

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(d) Licensee and Licensor Cooperation. The Licensee will cooperate fully
with the Licensor at the Licensor's expense in any such action the Licensor may
decide to take, and, if requested by the Licensor, shall join with the Licensor
in such actions as the Licensor may deem advisable for the protection of the
Trademarks or the Licensor's rights. The Licensor will cooperate fully with the
Licensor at the Licensee's expense (subject to reimbursement as provided above)
in any such permitted action the Licensee may decide to take, and, if requested
by the Licensee, shall join with the Licensee in such actions as the Licensor
may deem advisable for the protection of the Trademarks or the Licensee's
rights.

(e) Costs and Expenses. Except as otherwise provided above, any and all
costs and expenses (including, without limitation, the fees and expenses of
attorneys and other professionals) incurred in the protection or defense of any
of the Trademarks in the Territory, or the defense of any use or application of
the Trademarks, shall be borne by the Licensor.

SECTION 13. Expenses of and Indemnity by the Licensee.

(a) The Licensee will pay and discharge, at its own expense, any and all
expenses, charges, fees and taxes (other than as provided in subsection (b) of
this Section and Section 6 hereof) arising out of or incidental to the carrying
on of the Licensee's business, and the Licensee will indemnify and hold the
Licensor harmless from any and all claims that may be imposed on the Licensor
for such expenses, charges, fees and taxes.

(b) Except as otherwise provided in Section 10 hereof, the Licensee shall
indemnify, defend (with counsel selected by the Licensee and reasonably
acceptable to the Licensor) and hold the Licensor and its representatives and
agents harmless from, against and with respect to any claim, suit, loss, damage,
demands, injuries or expense (including the reasonable fees and expenses of
attorneys and other professionals) arising out of or related directly or
indirectly to any Product, Service, or other Trademark bearing item sold or
provided by the Licensee or any other act or omission of the Licensee, except to
the extent attributable to the bad faith, negligence or willful misconduct of
the Licensor or its representatives.

SECTION 14. Relationship between the Parties. The rights, powers,
privileges, remedies and interests accorded to the Licensor under this Agreement
and applicable law are for the protection of the Licensor, not the Licensee, and
no term or provision of this Agreement is intended (or shall be deemed or
construed) to impose on the Licensor any duty or obligation to the Licensee to
monitor or police any of the activities of the Licensee. No term or provision of
this Agreement is intended to create, nor shall any such term or provision be
deemed or construed to have created, any employment, joint venture, partnership,
trust, agency or other fiduciary relationship between the Licensee and the
Licensor or constitute the Licensee as an employee, joint venturer, partner,
trustee, agent or other representative for or of the Licensor. The Licensee
shall not be entitled or have any power or authority to bind or obligate the
Licensor in any manner whatsoever or to hold itself out as an employee, joint
venturer, partner, trustee, agent or other representative for or of the
Licensor.

SECTION 15. Waiver of Jury Trial. In any action, suit or proceeding in any
jurisdiction brought against any Party by any other Party, each Party hereby
irrevocably waives trial by jury.

SECTION 16. Consent to New York Jurisdiction and Venue, Etc. Each Party
hereby consents and agrees that the Supreme Court of the State of New York for
the County of Westchester and the United States District Court for the Southern
District of New York each shall have personal jurisdiction and proper venue with
respect to any dispute between the Parties; provided that the foregoing consent
shall not deprive any Party of the right in its discretion to voluntarily
commence or participate in any other forum having jurisdiction and venue. In any
dispute, no Party will raise, and each Party hereby expressly and irrevocably
waives, any objection or defense to any such jurisdiction as an inconvenient
forum.

SECTION 17. Notices. Except as otherwise expressly provided, any notice,
request, demand or other communication permitted or required to be given under
this Agreement shall be in writing, shall be sent by one of the following means
to the addressee at the address set forth above (or at such other address as
shall be designated hereunder by notice to the other parties and persons
receiving copies, effective upon actual receipt) and shall be deemed con
clusively to have been given: (i) on the first Business Day following the day
timely deposited with Federal Express (or other equivalent national overnight
courier) or United States Express Mail, with the cost of delivery prepaid or for
the account of the sender; (ii) on the fifth Business Day following the day duly
sent by certified or registered United States mail, postage prepaid and return
receipt requested; or
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(iii) when otherwise actually received by the addressee on a Business Day (or on
the next Business Day if received after the close of normal business hours or on
any non-business day).

SECTION 18. Further Assurances. Each Party agrees to do such further acts
and things and to execute and deliver such statements, assignments, agreements,
instruments and other documents as the other Party from time to time reasonably
may request in order to (a) evidence or confirm the transfer or issuance of any
stock or Asset or (b) effectuate the purpose and the terms and provisions of
this Agreement, each in such form and substance as may be acceptable to the
Parties.

SECTION 19. Interpretation, Headings, Severability, Etc. The parties
acknowledge and agree that the terms and provisions of this Agreement have been
negotiated, shall be construed fairly as to all parties hereto, and shall not be
construed in favor of or against any party. The section headings contained in
this Agreement are for reference purposes only and shall not affect the meaning
or interpretation of this Agreement. In the event that any term or provision of
this Agreement (other than Section 1 hereof) shall be finally determined to be
superseded, invalid, illegal or otherwise unenforceable pursuant to applicable
law by a governmental authority having jurisdiction and venue, that
determination shall not impair or otherwise affect the validity, legality or
enforceability (a) by or before that authority of the remaining terms and
provisions of this Agreement, which shall be enforced as if the unenforceable
term or provision were deleted or reduced pursuant to the next sentence, as
applicable, or (b) by or before any other authority of any of the terms and
provisions of this Agreement. If any term or provision of this Agreement is held
to be unenforceable because of the scope or duration of any such provision, the
parties agree that any court making such determination shall have the power, and
is hereby requested, to reduce the scope or duration of such term or provision
to the maximum permissible under applicable law so that said term or provision
shall be enforceable in such reduced form.

SECTION 20. Successors and Assigns; Assignment; Intended
Beneficiaries. Whenever in this Agreement reference is made to any person, such
reference shall be deemed to include the successors, assigns, heirs and legal
representatives of such person, and, without limiting the generality of the
foregoing, all representations, warranties, covenants and other agreements made
by or on behalf of any Party in this Agreement shall inure to the benefit of the
successors, assigns, heirs and legal representatives of each other Party;
provided, however, that nothing herein shall be deemed to authorize or permit
the Licensee to assign any of its rights or obligations under this Agreement to
any other person, and the Licensee covenants and agrees that it shall not make
any such assignment, except as otherwise provided in Section 1 hereof or with
the prior written consent of the Licensor. The representations, warranties and
other terms and provisions of this Agreement are for the exclusive benefit of
the Parties hereto, and, except as otherwise expressly provided herein, no other
person (including creditors of any party hereto) shall have any right or claim
against any Party by reason of any of those terms and provisions or be entitled
to enforce any of those terms and provisions against any Party.

SECTION 21. No Waiver by Action, Etc. Any waiver or consent respecting any
representation, warranty, covenant or other term or provision of this Agreement
shall be effective only in the specific instance and for the specific purpose
for which given and shall not be deemed, regardless of frequency given, to be a
further or continuing waiver or consent. The failure or delay of a Party at any
time or times to require performance of, or to exercise its rights with respect
to, any representation, warranty, covenant or other term or provision of this
Agreement in no manner (except as otherwise expressly provided herein) shall
affect its right at a later time to enforce any such provision. No notice to or
demand on any Party in any case shall entitle such Party to any other or further
notice or demand in the same, similar or other circumstances. All rights,
powers, privileges, remedies and other interests of each Party hereunder are
cumulative and not alternatives, and they are in addition to and shall not limit
(except as other wise expressly provided herein) any other right, power,
privilege, remedy or other interest of such Party under this Agreement or
applicable law.

SECTION 22. Counterparts; New York Governing Law; Amendments; Entire
Agreement. This Agreement shall be effective as of the date first written above
when executed by Parties and delivered to the Licensor. This Agreement may have
been executed in two or more counterpart copies of the entire document or of
signature pages to the document, each of which may be executed by one or more of
the Parties hereto, but all of which, when taken together, shall constitute a
single agreement binding upon all of the Parties hereto. This Agreement shall be
governed by and construed in accordance with the applicable laws pertaining in
the State of New York (other than those that would defer to the substantive laws
of another jurisdiction).

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Each and every modification and amendment of this Agreement shall be in writing
and signed by all of the Parties, and each and every waiver of, or consent to
any departure from, any representation, warranty, covenant or other term or
provision of this Agreement shall be in writing and signed by each affected
Party. This Agreement contains the entire agreement of the parties and
supersedes all prior and other representations, agreements and understandings
(oral or otherwise) between the parties with respect to the matters contained
herein.

IN WITNESS WHEREOF, the Parties have duly executed and delivered this
Agreement as of the date first above written.

SPAR Infotech, Inc.

By:
--------------------------------------
Title:

SPAR Trademarks, Inc.

By:
--------------------------------------
Title:

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SCHEDULE A

UNITED STATES

MARK                   REG. NO.         REG. DATE
----                   ---------    -----------------

SPAR.................................  1,357,128    August 27, 1985
SPAR & design........................  1,357,132    August 27, 1985
SPAR & design........................  1,387,743    March 25, 1986
SPAR.................................  1,441,909    June 9, 1987
SPAR.................................  1,597,275    May 22, 1990

CANADA

MARK                   REG. NO.         REG. DATE
----                   ---------    -----------------

SPAR.................................    337,986    March 11, 1988
SPAR & design........................    337,987    March 11, 1988
SPAR & design........................    341,996    June 23, 1988
SPAR.................................    349,073    December 16, 1988
SPAR & design........................    390,182    November 15, 1991

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EXHIBIT D

BUSINESS MANAGER AGREEMENT

INTRODUCTION

This Business Manager Agreement, dated as of                , 1999 (as the
same may be supplemented, modified, amended, restated or replaced from time to
time in the manner provided herein, this "Agreement"), is by and between SPAR
Infotech, Inc., a Nevada corporation currently having an address at 303 South
Broadway, Suite 140, Tarrytown, New York 10591 ("Infotech"), SPAR Marketing
Force, Inc., a Nevada corporation currently having an address at 303 South
Broadway, Suite 140, Tarrytown, New York 10591 ("Marketing Force"), and SPAR
Marketing Services, Inc., a Nevada corporation currently having an address at
303 South Broadway, Suite 140, Tarrytown, New York 10591 ("SMS"). The above
entities are sometimes referred to herein individually as a "Party" and
collectively as the "Parties".

RECITALS

The efforts of the Parties prior to the date of this Agreement resulted in
the creation of certain Confidential Information, Software and Program
Documentation (collectively referred to herein as the "Joint Works"). The
Parties have determined that it is in their best interests to resolve any
existing or potential disputes concerning their respective rights in the Joint
Works, all upon the terms and provisions and subject to the conditions set forth
in this Agreement.

AGREEMENT

In consideration of the foregoing, the mutual covenants and agreements
hereinafter set forth, and other good and valuable consideration (the receipt
and adequacy of which is hereby acknowledged by the Parties), the Parties hereto
hereby agree as follows:

SECTION 1. Definitions. Each use in this Agreement of a neuter pronoun
shall be deemed to include references to the masculine and feminine variations
thereof, and vice versa, and a singular pronoun shall be deemed to include a
reference to the plural variation thereof, and vice versa, in each case as the
context may permit or require. As used in this Agreement, the following
capitalized terms and non-capitalized words and phrases shall have the meanings
respectively assigned to them below, which meanings shall be applicable equally
to the singular and plural forms of the terms so defined:

(a) "Business Competitive With Infotech" shall mean any substantial
business activity in collecting, analyzing and/or disseminating scanner
data, ex-factory shipment data and/or other similar information.

(b) "Business Competitive With Marketing Force" shall mean any
substantial business activity conducted by any person that is competitive
with any substantial business activity conducted by any SPAR Company or PIA
Company at the Merger Effective Time (whether or not such person's activity
is actually conducted in competition with any SPAR Company or PIA Company),
excluding, however, any Business Competitive With Infotech (whether or not
so conducted by any SPAR Company or PIA Company).

(c) "Confidential Information" includes all field and file definitions
and source code relating to the Software and the Program Documentation (as
each are hereinafter defined), including (without limitation) the designs,
methods, layouts, processing procedures, programming techniques used or
employed by the Parties, including combinations thereof, in conjunction
therewith, and encompass interactive data entry, file handling, report
generation and all other aspects of operation.

(d) "Merger Effective Time" shall mean the "Effective Time" under (and
as defined in) the Agreement and Plan of Merger dated as of February 28,
1999, among the SPAR Companies and the PIA Companies (which is the time the
merger thereunder takes effect and the SPAR Companies and PIA Companies
come under common control), as the same may be supplemented, modified,
amended, restated or replaced from time to time in the manner provided
therein.

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(e) "PIA Company" and "PIA Companies" shall respectively mean any one
or more of PIA Merchandising Services, Inc., a Delaware corporation, SG
Acquisition, Inc., a Nevada corporation (which is merging into SPAR
Acquisition, Inc.), PIA Merchandising Co., Inc., a California corporation,
and their respective subsidiaries as of the Merger Effective Time.

(f) "Program Documentation" means the user manuals, handbooks and
other written materials relating to the Software, and any subsequent
updates or revisions to such scheduling software.

(g) "Representative" of any Party shall mean any of its directors,
officers, employees, attorneys, heirs, executors, administrators, or
agents, any of such Party's sublicensees, affiliates, successors and
assigns, or any of their respective directors, officers, employees,
attorneys, heirs, executors, administrators, or agents.

(h) "Software" means the application software program(s) respecting
the "Business Manager" Internet scheduling software consisting of
executable object code programs for such scheduling software and related
screen formats programmed to operate on the systems of the Parties, and any
subsequent updates or revisions to such scheduling software.

(i) "SPAR Company" and "SPAR Companies" shall respectively mean any
one or more of SPAR Acquisition, Inc., a Nevada corporation, SPAR
Marketing, Inc., a Delaware corporation, SPAR Marketing, Inc., a Nevada
corporation, SPAR Marketing Force, Inc., a Nevada corporation, SPAR, Inc.,
a Nevada corporation, SPAR/Burgoyne Retail Services, Inc., an Ohio
corporation, SPAR Incentive Marketing, Inc., a Delaware corporation, SPAR
MCI Performance Group, Inc., a Delaware corporation, and SPAR Trademarks,
Inc., a Nevada corporation.

SECTION 2. The Joint Works; Future Development; Sublicenses; Limits on Use.

(a) The Parties as Co-Owners of the Joint Works. In consideration for the
promises made to it under this Agreement, each Party hereby grants and conveys
to the other any and all right, title and interest in and to the Joint Works
that it may have as may be required to render any other Party a co-owner of the
Joint Works. Each party hereby acknowledges and agrees that each party is now
and at all times has been a co-owner of all right, title and interest in and to
the Joint Works, including (without limitation), the United States and
international copyright interests therein, and any and all moral rights in the
Joint Works recognized by applicable law, such that the Parties each has and
shall each continue to have, for any and all purposes, the right to transfer,
develop, license, control and otherwise exploit the Joint Works, in whole or in
any part, as each of them may see fit, in any and all media subject to the terms
and conditions set forth in this Agreement. Each party covenants and agrees that
it shall in all future publications of the Joint Works, refer to its author as
"SPAR Infotech, Inc., SPAR Marketing Force, Inc. and SPAR Marketing Services,
Inc." and state its copyright as "(C) [Date of Publication] SPAR Infotech, Inc.,
SPAR Marketing Force, Inc. and SPAR Marketing Services, Inc." "All rights
reserved."

(b) Waiver of Claims and Rights of Participation and Accounting.  Each of
the Parties hereby knowingly and intentionally waives whatever claims it may now
have or may ever have against the other Parties and their respective
Representatives for any claim related to rights of exploitation of the Joint
Works, including (without limitation) claims for authorship or copyright
infringement. Each of the Parties knowingly and intentionally waives any and all
claims or rights that it may have or may ever have against the other Parties and
their respective Representatives for any right of participation in, or
accounting for, the revenues that the other party may derive from its use or
exploitation of the Joint Works, in whole or in part, without limitation.

(c) Future Development. The Parties acknowledge and agree that any Party
may engage any other Party from time to time to provide programming services,
system work and other assistance in developing, revising and improving the
Software and/or the Program Documentation, which shall be deemed and construed
to be for the benefit of all of the Parties. The Parties agree that their
respective contributions to all such improvements, revisions and developments
shall be included within the scope of the term "Software" and the term "Program
Documentation," respectively, as such terms are used in this Agreement and shall
not be the sole property of any Party hereto.

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(d) Sublicenses. Each Party from time to time may add one or more
subsidiaries or affiliates (but only those under common ownership and control
with the Parties) as a sublicensee under this Agreement (each a "Sublicensee"
and collectively "Sublicensees"). Each Sublicensee hereby assumes and agrees to
be bound by the terms, provisions and conditions as set forth in this Agreement
as if it were a "Party" hereunder. In the event the control or ownership of any
Sublicensee, its business or substantially all of its assets are sold or
transferred so that such Sublicensee, business or assets cease to be under
common ownership and control with the sublicensing Party, such subsidiary or
affiliate shall automatically cease to be a Sublicensee hereunder from and after
such sale or transfer, without, however, relieving or otherwise affecting any of
the obligations of such former Sublicensees with respect to its obligations with
respect to actions or events arising prior to such sale or transfer.

(e) Certain Limits on Use by Parties. Neither Infotech nor any of its
Sublicensees shall use the Software or the Program Documentation in any material
respect in any Business Competitive With Marketing Force; and neither Marketing
Force nor SMS nor any of their respective Sublicensees shall use the Software or
the Program Documentation in any material respect in any Business Competitive
With Infotech. The Parties acknowledge and agree that such limitation shall not
preclude any Party or its Sublicensees from using the Software and the Program
Documentation for any other purpose whatsoever (subject to the licensing
limitations of Section 5 hereof).

(f) No Unpermitted Users. No Party shall cause, suffer or permit any of its
affiliates or cause or enable any other person to use the Software or the
Program Documentation in any material respect unless such person is a permitted
Licensee or Sublicensee hereunder.

SECTION 3. Term. The term of this Agreement shall be perpetual.

SECTION 4. Mutual Exculpation and Release. No Party nor any of its
Representatives shall incur any liability to any other Party or any of its
Representatives for any acts or omissions arising out of or related directly or
indirectly to any of the Software, Program Documentation or Confidential
Information, any license, use or application thereof, or any claims or actions
(including, without limitation, claims for malfunction or infringement) and any
resulting losses or expenses with respect thereto of any Party or any of their
respective Representatives of any kind or nature whatsoever, whether known or
unknown, in law or equity or otherwise; and each Party (on behalf of itself and
each of its Representatives) hereby expressly waives any and all such claims,
actions, losses and expenses against each of the releasing Party and its
Representatives ever had, now have or hereafter can, shall or may have, against
the each other Party and its Representatives by reason of any matter, cause or
thing whatsoever from the beginning to the end of the world; provided, however,
that the foregoing release shall not apply to the Parties' respective
obligations set forth in this Agreement.

SECTION 5. Third Party Licensing. Subject to the terms and conditions
herein contained, each Party (but not its Sublicensees) may grant licenses to
make, use or sell the Software and Program Documentation (a "License") to one or
more third parties (each a "Licensee" and collectively "Licensees") on such
terms and conditions as such Party may elect, provided, however, that (a)
Infotech shall not grant any License to make, use or sell the Software or the
Program Documentation to any Licensee whose business is a Business Competitive
With Marketing Force; and (b) neither Marketing Force nor SMS shall grant any
License to make, use or sell the Software or the Program Documentation to any
Licensee whose business is a Business Competitive With Infotech.

SECTION 6. Representations and Warranties Respecting the Parties. Each
Party represents and warrants to the each of the other Parties that, as of the
date hereof that: (a) such Party is a corporation duly incorporated, validly
existing and in good standing under the laws its state of incorporation; (b)
such Party has the legal capacity, power, authority and unrestricted right to
execute and deliver this Agreement and to perform all of its obligations
hereunder; (c) the execution and delivery by such Party of this Agreement and
the performance by such Party of all of its obligations hereunder will not
violate or be in conflict with any term or provision of (i) any applicable law,
(ii) any judgment, order, writ, injunction, decree or consent of any court or
other judicial authority applicable to such Party or any material part of such
Party's assets and properties, (iii) any of its organizational documents, or
(iv) any material agreement or document to which such Party is a party or
subject or that applies to any material part of such Party's assets and
properties; (d) no consent, approval or authorization of, or registration,
declaration or filing with, any governmental authority or other person is
required as a condition precedent, concurrent or subsequent to or in connection
with the due and

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valid execution, delivery and performance by such Party of this Agreement or the
legality, validity, binding effect or enforceability of any of the terms and
provisions of this Agreement; and (e) this Agreement is a legal, valid and
binding obligation of such Party, enforceable against such Party in accordance
with its terms and provisions.

SECTION 7. Relationship Among the Parties. No term or provision of this
Agreement is intended to create, nor shall any such term or provision be deemed
or construed to have created, any employment, joint venture, partnership, trust,
agency or other fiduciary relationship between the Parties and no Party shall be
considered as an employee, joint venturer, partner, trustee, agent or other
representative for or of any other Party. No Party shall not be entitled or have
any power or authority to bind or obligate any other Party in any manner
whatsoever or to hold itself out as an employee, joint venturer, partner,
trustee, agent or other representative of any other Party.

SECTION 8. Waiver of Jury Trial. In any action, suit or proceeding in any
jurisdiction brought against any Party by any other Party, each Party hereby
irrevocably waives trial by jury.

SECTION 9. Consent to New York Jurisdiction and Venue, Etc. Each Party
hereby consents and agrees that the Supreme Court of the State of New York for
the County of Westchester and the United States District Court for the Southern
District of New York each shall have personal jurisdiction and proper venue with
respect to any dispute between the Parties; provided that the foregoing consent
shall not deprive any Party of the right in its discretion to voluntarily
commence or participate in any other forum having jurisdiction and venue. In any
dispute, no Party will raise, and each Party hereby expressly and irrevocably
waives, any objection or defense to any such jurisdiction as an inconvenient
forum.

SECTION 10. Notices. Except as otherwise expressly provided, any notice,
request, demand or other communication permitted or required to be given under
this Agreement shall be in writing, shall be sent by one of the following means
to the addressee at the address set forth above (or at such other address as
shall be designated hereunder by notice to the other parties and persons
receiving copies, effective upon actual receipt) and shall be deemed
conclusively to have been given: (i) on the first business day following the day
timely deposited with Federal Express (or other equivalent national overnight
courier) or United States Express Mail, with the cost of delivery prepaid or for
the account of the sender; (ii) on the fifth business day following the day duly
sent by certified or registered United States mail, postage prepaid and return
receipt requested; or (iii) when otherwise actually received by the addressee on
a business day (or on the next business day if received after the close of
normal business hours or on any non-business day).

SECTION 11. Further Assurances. Each Party agrees to do such further acts
and things and to execute and deliver such statements, assignments, agreements,
instruments and other documents as the other Party from time to time reasonably
may request in order to effectuate the purpose and the terms and provisions of
this Agreement, each in such form and substance as may be acceptable to the
Parties. Without limiting the generality of the foregoing, each Party hereto
will provide each other Party hereto, at such other Party's request and expense,
with copies of the source or object code version of the Software and any and all
related documentation to enable such requesting Party to develop and enhance the
Software and the Program Documentation.

SECTION 12. Interpretation, Headings, Severability, Etc. The Parties
acknowledge and agree that the terms and provisions of this Agreement have been
negotiated, shall be construed fairly as to all parties hereto, and shall not be
construed in favor of or against any party. The section headings contained in
this Agreement are for reference purposes only and shall not affect the meaning
or interpretation of this Agreement. In the event that any term or provision of
this Agreement (other than Section 1 hereof) shall be finally determined to be
superseded, invalid, illegal or otherwise unenforceable pursuant to applicable
law by a governmental authority having jurisdiction and venue, that
determination shall not impair or otherwise affect the validity, legality or
enforceability (a) by or before that authority of the remaining terms and
provisions of this Agreement, which shall be enforced as if the unenforceable
term or provision were deleted or reduced pursuant to the next sentence, as
applicable, or (b) by or before any other authority of any of the terms and
provisions of this Agreement. If any term or provision of this Agreement is held
to be unenforceable because of the scope or duration of any such provision, the
Parties agree that any court making such determination shall have the power, and
is hereby requested, to reduce the scope or duration of such term or provision
to the

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maximum permissible under applicable law so that said term or provision shall be
enforceable in such reduced form.

SECTION 13. Successors and Assigns; Assignment; Intended
Beneficiaries. Whenever in this Agreement reference is made to any person, such
reference shall be deemed to include the successors, assigns, heirs and legal
representatives of such person, and, without limiting the generality of the
foregoing, all representations, warranties, covenants and other agreements made
by or on behalf of any Party in this Agreement shall inure to the benefit of the
successors, assigns, heirs and legal representatives of each other Party;
provided, however, that nothing herein shall be deemed to authorize or permit
any Party to assign any of its rights or obliga tions under this Agreement to
any other person, and each Party covenants and agrees that it shall not make any
such assignment, except as otherwise provided in Section 5 hereof or with the
prior written consent of the other Parties. The representations, warranties and
other terms and provisions of this Agreement are for the exclusive benefit of
the Parties hereto, and, except as otherwise expressly provided herein, no other
person (including creditors of any party hereto) shall have any right or claim
against any Party by reason of any of those terms and provisions or be entitled
to enforce any of those terms and provisions against any Party.

SECTION 14. No Waiver by Action, Etc. Any waiver or consent respecting any
representation, warranty, covenant or other term or provision of this Agreement
shall be effective only in the specific instance and for the specific purpose
for which given and shall not be deemed, regardless of frequency given, to be a
further or continuing waiver or consent. The failure or delay of a Party at any
time or times to require performance of, or to exercise its rights with respect
to, any representation, warranty, covenant or other term or provision of this
Agreement in no manner (except as otherwise expressly provided herein) shall
affect its right at a later time to enforce any such provision. No notice to or
demand on any Party in any case shall entitle such Party to any other or further
notice or demand in the same, similar or other circumstances. All rights,
powers, privileges, remedies and other interests of each Party hereunder are
cumulative and not alternatives, and they are in addition to and shall not limit
(except as otherwise expressly provided herein) any other right, power,
privilege, remedy or other interest of such Party under this Agreement or
applicable law.

SECTION 15. Counterparts; New York Governing Law; Amendments; Entire
Agreement. This Agreement shall be effective as of the date first written above
when executed by all of the Parties. This Agreement may have been executed in
two or more counterpart copies of the entire document or of signature pages to
the document, each of which may be executed by one or more of the Parties
hereto, but all of which, when taken together, shall constitute a single
agreement binding upon all of the Parties hereto. This Agreement shall be
governed by and construed in accordance with the applicable laws pertaining in
the State of New York (other than those that would defer to the substantive laws
of another jurisdiction). Each and every modification and amendment of this
Agreement shall be in writing and signed by all of the Parties, and each and
every waiver of, or consent to any departure from, any representation, warranty,
covenant or other term or provision of this Agreement shall be in writing and
signed by each affected Party. This Agreement contains the entire agreement of
the parties and supersedes all prior and other representations, agreements and
understandings (oral or otherwise) between the parties with respect to the
matters contained herein.

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[Signature Page to Business Manager Agreement]

IN WITNESS WHEREOF, the Parties have duly executed and delivered this
Agreement as of the date first above written.

SPAR INFOTECH, INC.

By:

------------------------------------
Title:

SPAR MARKETING FORCE, INC.

By:

------------------------------------
Title:

SPAR MARKETING SERVICES, INC.

By:

------------------------------------
Title:

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EXHIBIT E

CERTIFICATE OF AMENDMENT

OF

CERTIFICATE OF INCORPORATION

OF

PIA MERCHANDISING SERVICES, INC.

The undersigned corporation, organized and existing under and by virtue of
the General Corporation Law of the State of Delaware does hereby certify as
follows:

1. That Cathy L. Wood is the duly elected and acting Secretary and
Chief Financial Officer of PIA Merchandising Services, Inc., a Delaware
corporation (the "Corporation").

2. That Article FIRST of the Certificate of Incorporation of the
Corporation is amended to read in full as follows:

"FIRST: The name of the Corporation is SPAR Group, Inc."

3. That Article FOURTH of the Certificate of Incorporation of the
Corporation is amended to read in full as follows:

"FOURTH: The total number of shares of stock which the Corporation
shall have the authority to issue is 50,000,000, consisting of 47,000,00
shares of common stock, par value $.01 per share, and 3,000,000 shares
of preferred stock, par value $.01 per share. The preferred stock may be
issued at any time, and from time to time, in one or more series
pursuant hereto or to a resolution or resolutions providing for such
issue duly adopted by the board of directors (the "Board") of the
Corporation (authority to do so being hereby expressly vested in the
Board), and such resolution or resolutions shall also set forth the
voting powers, full or limited, or none, of each such series of
preferred stock and shall fix the designations, preferences and
relative, participating, optional or other special rights and
qualifications, limitations or restrictions of each such series of
preferred stock."

4. That Article TENTH of the Certificate of Incorporation of the
Corporation is hereby deleted and Article ELEVENTH is hereby renumbered as
Article TENTH.

5. That this Certificate of Amendment of Certificate of Incorporation
has been duly approved by the Board of Directors of the Corporation.

6. That this Certificate of Amendment of Certificate of Incorporation
has been duly approved by the holders of a majority of the outstanding
shares of common stock, $.01 par value per share, of the Corporation in
accordance with the applicable provisions of Section 242 of the General
Corporation Law of the State of Delaware.

IN WITNESS WHEREOF, the Corporation has caused this Certificate to be
signed by Cathy L. Wood this      day of                1999.

PIA MERCHANDISING SERVICES, INC.

By:

------------------------------------
Cathy L. Wood,
Secretary and Chief Financial
Officer

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EXHIBIT 1 TO FIRST AMENDMENT TO MERGER AGREEMENT

EXHIBIT E-1

FORM OF REVERSE SPLIT AMENDMENT TO PIA DELAWARE CERTIFICATE OF INCORPORATION

Upon this Certificate of Amendment to the Certificate of Incorporation of
the Corporation becoming effective pursuant to the General Corporation Law of
the State of Delaware (the "Effective Time"), each share of the Corporation's
common stock, par value $.01 per share (the "Old Common Stock"), issued and
outstanding immediately prior to the Effective Time, will be automatically
reclassified as and converted into [               ] of a share of common stock,
par value $.01 per share, of the Corporation (the "New Common Stock"). Any stock
certificate that, immediately prior to the Effective Time, represented shares of
the Old Common Stock will, from and after the Effective Time, automatically and
without the necessity of presenting the same for exchange, represent the number
of shares of the New Common Stock as equals the product obtained by multiplying
the number of shares of Old Common Stock represented by such certificate
immediately prior to the Effective Time by [               ]. No fractional
shares of New Common Stock will be issued in connection with the
reclassification and conversion of the Old Common Stock into the New Common
Stock. In lieu of any fractional shares, each holder of Old Common Stock who
would otherwise receive a fractional share of New Common Stock will be entitled
to receive cash in an amount equal to the product obtained by multiplying (1)
the closing sales price of the Corporation's Common Stock at the Effective Time
as reported on the Nasdaq National Market (or, if applicable, the Nasdaq
SmallCap Market or any exchange that the PIA Common Stock may be traded on at
the Effective Time) by (2) the number of shares of Old Common Stock held by such
holder that would otherwise have been exchanged for such fractional share
interest.

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EXHIBIT F

PIA MERCHANDISING SERVICES, INC.

AMENDED AND RESTATED 1995 STOCK OPTION PLAN

SECTION 1. Description of this Plan. This is the 1995 Stock Option Plan,
dated December 5, 1995, as amended and restated effective as of February 28,
1999 (this "Plan"), of PIA Merchandising Services, Inc., a Delaware corporation
(the "Company"). Under this Plan, officers, directors, key employees and
consultants of the Company or its wholly-owned Subsidiaries (as defined below),
and other persons directly or indirectly providing valuable services to the
Company and the Subsidiaries, to be selected as set forth below, may be granted
options ("Options") to purchase shares of the common stock, par value $0.01 per
share, of the Company ("Common Stock"). This Plan permits the granting of both
Options that qualify for treatment as incentive stock options ("Incentive Stock
Options") under Section 422 of the Internal Revenue Code of 1986, as amended
(the "Code"), and Options that do not qualify as Incentive Stock Options
("Nonqualified Stock Options"). For purposes of this Plan, the term "Subsidiary"
shall mean any corporation or other entity of which 50% or more of the voting
stock (or equivalent thereof) is owned by the Company or by another Subsidiary
(as so defined) of the Company.

SECTION 2. Purpose of this Plan. The purpose of this Plan and of granting
Options to specified persons is to further the growth, development and financial
success of the Company and the Subsidiaries by providing additional incentives
to certain officers, directors, key employees and consultants of, and other
persons directly or indirectly providing valuable services to, the Company and
the Subsidiaries. By assisting such persons in acquiring shares of Common Stock,
the Company can ensure that such persons will themselves benefit directly from
the Company's and the Subsidiaries' growth, development and financial success.

SECTION 3. Eligibility. The persons who shall be eligible to receive grants
of Options under this Plan shall be, at the time of the grant, the officers,
directors, key employees and consultants of, and other persons directly or
indirectly providing valuable services to, the Company and the Subsidiaries.
Notwithstanding the preceding sentence, only persons who are employees of the
Company and the Subsidiaries shall be eligible to receive grants of Incentive
Stock Options under this Plan. A person who holds an Option is herein referred
to as a "Participant." More than one Option may be granted to any Participant,
grants of Options may be made on more than one occasion to any Participant and
any individual Participant may receive grants of Options on up to 1,000,000
shares of Common Stock. Such grants of Options under this Plan may include an
Incentive Stock Option, Nonqualified Stock Option, or any combination thereof.

SECTION 4. Administration. This Plan shall be administered by the Board of
Directors (the "Board") or by the Compensation Committee established by the
Board. (The entity actually administering this Plan at any time, whether the
Board or the Compensation Committee, is referred to herein as the "Committee.")
If the Compensation Committee is authorized to administer this Plan at any time,
it shall, if possible, be composed solely of two or more Non-Employee Directors,
as such term is defined in Rule 16b-3(b)(3) under the Securities Exchange Act of
1934 (the "Exchange Act") and of persons who are "outside directors" within the
meaning of Code Section 162(m). The Committee shall meet at such times and
places as it determines and may meet through a telephone conference call. A
majority of its members shall constitute a quorum, and the decision of a
majority of those present at any meeting at which a quorum is present shall
constitute the decision of the Committee. A memorandum signed by all the members
of the Committee shall constitute the decision of the Committee without
necessity, in such event, for holding an actual meeting. The Committee is
authorized and empowered to administer this Plan and, subject to this Plan (a)
to select the Participants, to specify the number of shares of Common Stock with
respect to which Options are granted to each Participant, to specify the terms
of the Options and whether such Options shall be Incentive Stock Options or
Nonqualified Stock Options, and in general to grant Options; (b) to determine
the dates upon which Options shall be granted and the terms and conditions
thereof in a manner consistent with this Plan, which terms and conditions need
not be identical as to the various Options granted; (c) to interpret this Plan;
(d) to prescribe, amend and rescind rules relating to this Plan; (e) to
authorize any person to execute on behalf of the Company any instrument required
to effectuate the grant of an Option previously granted by the Committee; (f) to
determine the rights and obligations of Participants under this Plan; (g) to
specify the Option Price (as hereinafter defined); (h) to accelerate the time
during which an Option may be exercised, including, but not
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limited to, upon a change of control of the Company, and to otherwise accelerate
the time or extend the post-termination exercise period during which an Option
may be exercised, in each case notwithstanding the provisions in the Option
Agreement (as defined in Section 13) stating the time during which it may be
exercised; and (i) to make all other determinations deemed necessary or
advisable for the administration of this Plan. The good faith interpretation and
construction by the Committee of any provision of this Plan or of any Option
granted under it shall be final, conclusive and binding. No member of the
Committee shall be liable for any action or determination made in good faith
with respect to this Plan or any Option granted under it.

SECTION 5. Shares Subject to this Plan. The number of shares of Common
Stock in respect of which Options may be granted under this Plan is 3,500,000,
subject to adjustment as provided in Section 12 hereof. Upon the expiration,
termination or cancellation, in whole or in part, for any reason of an
outstanding Option or any portion thereof which shall not have vested or shall
not have been exercised in full, any shares of Common Stock then remaining
unissued which shall have been reserved for issuance upon such exercise shall
again become available for the granting of additional Options under this Plan.
Notwithstanding the foregoing, shares subject to a terminated Option shall
continue to be considered to be outstanding for purposes of determining the
maximum number of shares that may be issued to a Participant. Similarly, the
repricing of an Option will be considered the grant of a new Option for this
purpose.

SECTION 6. Option Price. Except as provided in Section 12 hereof, the
purchase price per share (the "Option Price") of the shares of Common Stock
underlying each Incentive Stock Option shall be not less than the fair market
value of such shares on the date of granting of the Incentive Stock Option;
provided, however, that if the Participant is a ten percent (10%) stockholder of
the Company as detailed in Code Section 422(b)(6) at the time such Option is
granted (determined after taking into account the constructive ownership rules
of Section 424(d) of the Code), the Option Price shall be not less than 110
percent (110%) of said fair market value. The Option Price of the shares of
Common Stock underlying each Nonqualified Stock Option shall be not less than
eighty-five percent (85%) of the fair market value of such shares on the date of
granting of the Nonqualified Stock Option; provided, however, that with respect
to any Nonqualified Stock Option granted to a "covered employee" (as such term
is defined in Section 162(m) of the Code), the Option Price of the shares of
Common Stock underlying such Nonqualified Stock Option shall be not less than
the fair market value of such shares on the date of granting of such
Nonqualified Stock Option. The fair market value of such shares shall, unless
otherwise expressly determined by the Committee for good reason, shall be (i)
the last reported sale price of the Common Stock on the Nasdaq National Market,
if the Common Stock is quoted on the Nasdaq National Market, (ii) the last
reported sale price of the Common Stock on a national securities exchange, if
the Common Stock is listed on a national securities exchange, or (iii) if the
Common Stock is not so reported or listed, the average of the last reported bid
and asked price of the Common Stock in such market as the Common Stock may be
traded.

SECTION 7. Restrictions on Grants; Vesting of Options. Notwithstanding any
other provisions set forth herein or in any Option Agreement, no Options may be
granted under this Plan subsequent to December 5, 2005. All Options granted
pursuant to this Plan shall be granted pursuant to Option Agreements, as
described in Section 13 hereof. The vesting of all Options may be based on the
Company's attaining of performance criteria as specified at the time of the
granting thereof and/or may also be based on the passage of time. The Committee
shall determine the performance criteria, the performance measurement period and
the vesting schedule applicable to each Option or group of Options in a
schedule, a copy of which shall be filed with the records of the Committee and
attached to each Option Agreement to which the same applies. The performance
criteria, the performance measurement period and the vesting schedule and period
of exercisability need not be identical for all Options granted hereunder.
Following the conclusion of each applicable performance measurement period, the
Committee shall determine, in its sole good faith judgment, the extent, if at
all, that each Option subject thereto shall have vested based upon the
applicable performance criteria and vesting schedule. To the extent any Option
shall not have vested, because the applicable performance criteria has not been
met, and does not also vest based on the passage of time, it shall, to that
extent, automatically terminate and cease to be exercisable to such extent
notwithstanding the stated term during which it may be exercised. The Committee
shall promptly notify each affected Participant of such determination. The
Committee may periodically review the performance criteria applicable to any
Option or

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Options and, in its sole good faith judgment, may adjust the same to reflect
unanticipated major events, such as catastrophic occurrences, mergers,
acquisitions and the like.

SECTION 8. Special Limitations on Incentive Stock Options. To the extent
that the aggregate fair market value (determined at the time the respective
Incentive Stock Option is granted) of Common Stock with respect to which
Incentive Stock Options are exercisable for the first time by a Participant
during any calendar year under all incentive stock option plans of the Company
and the Subsidiaries exceeds $100,000, or such other limit as may be required by
the Code, such excess Incentive Stock Options shall be treated as Nonqualified
Stock Options. The Committee shall determine, in accordance with applicable
provisions of the Code, Treasury Regulations and other administrative
pronouncements, which of a Participant's Incentive Stock Options will not
constitute Incentive Stock Options because of such limitation and shall notify
the Participant of such determination as soon as practicable after such
determination.

SECTION 9. Exercise of Options. Subject to all other provisions of this
Plan, once vested, each Option shall be exercisable for the full number of
shares of Common Stock subject thereto, or any part thereof, in such
installments and at such intervals as the Committee may determine in granting
such Option, provided that no option may be exercisable subsequent to its
termination date. Once vested, and prior to its termination date, an Option may
be exercised by the Participant by giving written notice to the Company
specifying the number of full shares to be purchased and accompanied by payment
of the full purchase price therefor in cash, by check or in such other form of
lawful consideration as the Committee may approve from time to time, including,
without limitation and in the sole discretion of the Committee, the assignment
and transfer by the Participant to the Company of outstanding shares of Common
Stock theretofore held by the Participant. In connection with such assignment
and transfer, the Company shall have the right to deduct any fractional share to
be paid to the Participant. Once vested, and prior to its termination date, an
Option may only be exercised by the Participant or, in the event of death of the
Participant, by the person or persons (including the deceased Participant's
estate) to whom the deceased Participant's rights under such Option shall have
passed by will or the laws of descent and distribution. Notwithstanding the
foregoing in the immediately preceding sentence, in the event of disability
(within the meaning of Section 22(e)(3) of the Code) of a Participant, a
designee, or if the Participant has no designee, the legal representative, of
such Participant may exercise the Option on behalf of such Participant (provided
such Option would have been exercisable by such Participant) until the right to
exercise such Option expires, as set forth in such Participant's particular
Option Agreement.

SECTION 10. Issuance of Common Stock. The Company's obligation to issue
shares of its Common Stock upon exercise of an Option is expressly conditioned
upon the compliance by the Company with any registration or other qualification
obligations with respect to such shares under any state or federal law or
rulings and regulations of any government regulatory body and the making of such
investment representations or other representations and undertakings by the
Participant (or the Participant's legal representative, heir or legatee, as the
case may be) in order to comply with the requirements of any exemption from any
such registration or other qualification obligations with respect to such shares
which the Company in its sole discretion shall deem necessary or advisable. Such
required representations and undertakings may include representations and
agreements that such Participant (or the Participant's legal representative,
heir or legatee): (a) is purchasing such shares for investment and not with any
present intention of selling or otherwise disposing of such shares; and (b)
agrees to have a legend placed upon the face and reverse of any certificates
evidencing such shares (or, if applicable, an appropriate data entry made in the
ownership records of the Company) setting forth (i) any representations and
undertakings which such Participant has given to the Company or a reference
thereto, and (ii) that, prior to effecting any sale or other disposition of any
such shares, the Participant must furnish to the Company an opinion of counsel,
satisfactory to the Company and its counsel, to the effect that such sale or
disposition will not violate the applicable requirements of state and federal
laws and regulatory agencies; provided, however, that any such legend or data
entry shall be removed when no longer applicable. The Company, during the term
of this Plan, will at all times reserve and keep available, and will use its
reasonable efforts to obtain from any regulatory body having jurisdiction any
requisite authority in order to issue and sell such number of shares of Common
Stock as shall be sufficient to satisfy the requirements of this Plan. The
inability of the Company to obtain, from any regulatory body having
jurisdiction, authority reasonably deemed by the Company's counsel to be
necessary for the lawful issuance and sale of any shares hereunder shall relieve
the Company of any liability in respect of the non-issuance or sale of such
shares as to which such requisite authority shall not have been obtained.

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SECTION 11. Non-transferability. Except as otherwise provided below, an
Option may not be sold, pledged, assigned, hypothecated, transferred or disposed
of in any manner other than by will or by the laws of descent or distribution.
The Committee may, in its discretion, authorize all or a portion of any
Nonqualified Stock Option granted to a Participant to be on terms which permit
transfer by such Participant to (a) the spouse, children or grandchildren of the
optionee ("Immediate Family Members"), (b) a trust or trusts for the exclusive
benefit of such Immediate Family Members, or (c) a partnership in which such
Immediate Family Members are the only partners, provided that (i) there may be
no consideration for any such transfer, and (ii) the Option Agreement (defined
below) pursuant to which such Options are granted must be approved by the
Committee, and must expressly provide for transferability in a manner consistent
with this Section 11. Following transfer, any such Options shall continue to be
subject to the same terms and conditions as were applicable immediately prior to
transfer, provided that for purposes of Sections 9 and 10 hereof the term
"Participants" shall be deemed to refer to the transferee. The events of
termination of employment of Section 25 hereof shall continue to be applied with
respect to the original Participant, following which the Options shall be
exercisable by the transferee only to the extent, and for the periods specified
in the Option Agreement. Any permitted transferee shall be required prior to any
transfer of an Option or shares of Common Stock acquired pursuant to the
exercise of an Option to execute a written undertaking to be bound by the
provisions of the applicable Option Agreement.

SECTION 12. Adjustments Upon Capitalization and Corporate Changes;
Substitute Options. Subject to Section 15(b) hereof, if the outstanding shares
of the Common Stock of the Company are changed into, or exchanged for, a
different number or kind of shares or securities of the Company through
reorganization, merger, recapitalization or reclassification, or if the number
of outstanding shares is changed through a stock split, stock dividend, stock
consolidation or like capital adjustment, or if the Company makes a distribution
in partial liquidation or any other comparable extraordinary distribution with
respect to its Common Stock, an appropriate adjustment shall be made by the
Committee in the number, kind or Option Price of shares as to which Options may
be granted. A corresponding adjustment shall likewise be made in the number,
kind or Option Price of shares with respect to which unexercised Options have
theretofore been granted. Any such adjustment in an outstanding Option, however,
shall be made without change in the total price applicable to the unexercised
portion of the Option but with a corresponding adjustment in the price for each
share covered by the Option. In making such adjustments, or in determining that
no such adjustments are necessary, the Committee may rely upon the advice of
counsel and accountants to the Company, and the good faith determination of the
Committee shall be final, conclusive and binding. No fractional shares of stock
shall be issued under this Plan on account of any such adjustment.

If the Company at any time should succeed to the business of another
corporation through a merger or consolidation, or through the acquisition of
stock or assets of such corporation or its subsidiaries, Options may be granted
under this Plan to option holders of such corporation or its subsidiaries, in
substitution for options to purchase stock of such corporation held by them at
the time of succession. The Committee, in its sole and absolute discretion,
shall determine the extent to which such substitute Options shall be granted (if
at all), the person or persons to receive such substitute Options (who need not
be all option holders of such corporation), the number of Options to be received
by each such person, the Option Price of such Option (which may be determined
without regard to Section 6 hereof) and the terms and conditions of such
substitute Options; provided, however, that the Option Price of each such
substituted Option which is an Incentive Stock Option shall be an amount such
that, in the sole and absolute judgment of the Committee (and in compliance with
Section 424(a) of the Code in the case of an Incentive Stock Option), the
economic benefit provided by such Option is not greater than the economic
benefit represented by the option in the acquired corporation as of the date of
the Company's acquisition of such corporation.

SECTION 13. Option Agreement. Each Option granted under this Plan shall be
evidenced by a written stock option agreement (an "Option Agreement") executed
by the Company and the Participant which (a) shall contain each of the
provisions and agreements herein specifically required to be contained therein,
(b) shall indicate whether such Option is to be an Incentive Stock Option or a
Nonqualified Stock Option, and if an Incentive Stock Option, shall contain terms
and conditions permitting such Option to qualify for treatment as an incentive
stock option under Section 422 of the Code, and (c) may contain such other terms
and conditions as the Committee deems desirable and which are not inconsistent
with this Plan.

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SECTION 14. Rights as a Stockholder. A Participant or permitted transferee
of a Participant shall have no rights as a stockholder with respect to any
shares covered by an Option until the date of an entry evidencing such ownership
is made in the stock transfer books of the Company (the "Exercise Date"). No
adjustment shall be made for dividends (ordinary or extraordinary, whether in
cash, securities or other property) or distributions or other rights for which
the record date is prior to the Exercise Date.

SECTION 15. Termination of Options, Acceleration of Options.

(a) Each Option shall terminate and expire, and shall no longer be subject
to exercise, as the Committee may determine in granting such Option, and each
Option granted under this Plan shall set forth a termination date thereof,
which, subject to earlier termination as set forth in Section 7 hereof or this
Section 15, or as otherwise set forth in any particular Option Agreement, with
respect to Nonqualified Stock Options, shall be no later than ten years from the
date such Option is granted, and with respect to Incentive Stock Options, shall
also be no later than ten years from the date such Option is granted unless the
Participant is a ten percent (10%) stockholder of the Company (as described in
Section 422(b)(6) of the Code, and determined after taking into account the
constructive ownership rules of Section 424(d) of the Code) at the time such
Option is granted, in which case the Option shall terminate and expire no later
than five years from the date of the grant thereof. An Incentive Stock Option
shall contain any additional termination events required by Section 422 of the
Code.

(b) Subject to Section 15(c) hereof, unless the Committee shall, in its
sole discretion, determine otherwise, upon (i) the dissolution, liquidation or
sale of all or substantially all of the business, properties and assets of the
Company, (ii) upon any reorganization, merger or consolidation in which the
Company does not survive, (iii) upon any reorganization, merger, consolidation
or exchange of securities in which the Company does survive and any of the
Company's stockholders have the opportunity to receive cash, securities of
another corporation and/or other property in exchange for their capital stock of
the Company, or (iv) upon any acquisition by any person or group (as defined in
Section 13(d) of the Securities Act of 1934) of beneficial ownership of more
than fifty percent (50%) of the Company's then outstanding shares of Common
Stock (each of the events described in clauses (i), (ii), (iii) or (iv) is
referred to herein individually as an "Extraordinary Event"), this Plan and each
outstanding Option shall terminate. In such event each Participant shall have
the right until 10 days before the effective date of the Extraordinary Event to
exercise, in whole or in part, any unexpired Option or Options issued to the
Participant, to the extent that said Option is then vested and exercisable
pursuant to the provisions of said Option or Options and of Section 7 hereof.
The termination of employment of, or the termination of a consulting or other
relationship with, a Participant for any reason shall not accelerate or
otherwise affect the number of shares with respect to which an Option may be
exercised; provided, however, that the Option may only be exercised with respect
to that number of shares which could have been purchased under the Option had
the Option been exercised by the Participant on the date of such termination.

(c) Notwithstanding the provisions of Section 7 or paragraphs (a) or (b) of
this Section 15, or any provision to the contrary contained in a particular
Option Agreement, the Committee, in its sole discretion, at any time, or from
time to time, may elect to accelerate the vesting of all or any portion of any
Option then outstanding. The decision by the Committee to accelerate an Option
or to decline to accelerate an Option shall be final, conclusive and binding. In
the event of the acceleration of the exercisability of Options as the result of
a decision by the Committee pursuant to this Section 15(c), each outstanding
Option so accelerated shall be exercisable for a period from and after the date
of such acceleration and upon such other terms and conditions as the Committee
may determine in its sole discretion; provided, however, that such terms and
conditions (other than terms and conditions relating solely to the acceleration
of exercisability and the related termination of an Option) may not adversely
affect the rights of any Participant without the consent of the Participant so
adversely affected. Any outstanding Option which has not been exercised by the
holder at the end of such stated period shall terminate automatically and become
null and void.

SECTION 16. Withholding of Taxes. The Company, or a Subsidiary, as the case
may be, may deduct and withhold from the wages, salary, bonus and other income
paid by the Company or such Subsidiary to the Participant the requisite tax upon
the amount of taxable income, if any, recognized by the Participant in
connection with the exercise in whole or in part of any Option, or the sale of
Common Stock issued to the Participant upon the exercise of an Option, as may be
required from time to time under any federal or state tax

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laws and regulations. This withholding of tax shall be made from the Company's
(or such Subsidiaries') concurrent or next payment of wages, salary, bonus or
other income to the Participant or by payment to the Company (or such
Subsidiaries) by the Participant of the required withholding tax, as the
Committee may determine. The Company may permit the Participant to elect to
surrender, or authorize the Company to withhold, shares of Common Stock (valued
at their fair market value on the date of surrender or withholding of such
shares) in satisfaction of the Company's withholding obligation, however, no
fractional shares of Common Stock shall be delivered, nor shall any cash in lieu
of fractional shares be paid, by the Company. The Company shall have the right
to deduct fractional shares to be paid to the Participant as a result of such
surrender or withholding of shares.

SECTION 17. Effectiveness and Termination of this Plan. This Plan became
effective on the date on which it was adopted by the Board and was approved by
approved by the stockholders of the Company within 12 months of December 5,
1995. This Plan shall terminate at the earliest of the time when all shares of
Common Stock which may be issued hereunder have been so issued, or at such time
as set forth in Section 15(b) hereof; provided, however, that the Board may in
its sole discretion terminate this Plan at any other time. Unless earlier
terminated by the Board, this Plan shall terminate on December 5, 2005. Subject
to Section 15(b) hereof, no such termination shall in any way affect any Option
then outstanding.

SECTION 18. Time of Granting Options. The date of grant of an Option shall,
for all purposes, be the date on which the Committee makes the determination
granting such Option. Notice of the determination shall be given to each
Participant to whom an Option is so granted within a reasonable time after the
date of such grant.

SECTION 19. Amendment of this Plan. The Board may (a) make such changes in
the terms and conditions of granted Options as it deems advisable, provided each
Participant adversely affected by such change consents thereto, and (b) make
such amendments to this Plan as it deems advisable. Such amendments and changes
shall include, but not be limited to, acceleration of the time at which an
Option may be exercised. The Board may obtain stockholder approval of any
amendment to this Plan for any reason (including in order to take advantage of
certain exemptions under Code Section 162(m) or Code Section 422), but shall not
be required to do so unless required by law or by the rules of the Nasdaq
National Market or any stock exchange on which the Common Stock may then be
listed.

SECTION 20. Transfers and Leaves of Absence. For purposes of this Plan, (a)
a transfer of a Participant's employment or consulting relationship, without an
intervening period, between the Company and a Subsidiary shall not be deemed a
termination of employment or a termination of a consulting relationship, and (b)
a Participant who is granted in writing a leave of absence shall be deemed to
have remained in the employ of, or in a consulting relationship with, the
Company (or a Subsidiary, whichever is applicable) during such leave of absence.
Notwithstanding the foregoing, for purposes of determining the exercisability of
an Incentive Stock Option, a Participant who is on a leave of absence that
exceeds 90 days will be considered to have terminated his or her employment on
the 91st day of the leave of absence, unless the Participant's rights to
reemployment are guaranteed by statute or contract.

SECTION 21. No Obligation to Exercise Option. The granting of an Option
shall impose no obligation on the Participant to exercise such Option.

SECTION 22. Governing Law. This Plan and any Option granted pursuant to
this Plan shall be construed under and governed by the laws of the State of
Delaware without regard to conflict of law provisions thereof.

SECTION 23. Not an Employment or Other Agreement. Nothing contained in this
Plan or in any Option Agreement shall confer, intend to confer or imply any
rights of employment or any rights to any other relationship or rights to
continued employment by, or rights to a continued consulting relationship with,
the Company or any Subsidiaries in favor of any Participant or limit the ability
of the Company or any Subsidiaries to terminate, with or without cause, in its
sole and absolute discretion, the employment of, or relationship with, any
Participant, subject to the terms of any written employment or other agreement
to which a Participant is a party.

SECTION 24. Termination of Employment. The terms and conditions under which
an Option may be exercised after a Participant's termination of employment shall
be determined by the Committee and shall be
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specified in the Option Agreement. The conditions under which such
post-termination exercises shall be permitted with respect to Incentive Stock
Options shall be determined in accordance with the provisions of Section 422 of
the Code.

SECTION 25. Indemnification. In addition to such other rights of
indemnification as they may have as directors, the members of the Committee
shall be indemnified by the Company to the fullest extent permitted by law
against the reasonable expenses, including reasonable attorneys' fees, actually
and necessarily incurred in connection with the defense of any action, suit or
proceeding, or in connection with any appeal therein, to which they or any of
them may be a party by reason of any action taken or failure to act under or in
connection with this Plan or any Option granted thereunder, and against all
amounts paid by them in satisfaction of a judgment in any such action, suit or
proceeding, except in relation to matters as to which it shall be adjudged in
such action, suit or proceeding that such Committee member is not entitled to
indemnification under applicable law; provided that within 60 days after
institution of any such action, suit or proceeding such Committee member shall
in writing offer the Company the opportunity, at the Company's expense, to
handle and defend the same.

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EXHIBIT G

LIMITED INDEMNIFICATION AGREEMENT

INTRODUCTION

This Limited Indemnification Agreement, dated as of             , 1999 (as
the same may be supplemented, modified, amended, restated or replaced from time
to time in the manner provided herein, this "Agreement"), is by and among PIA
Merchandising Services, Inc., a Delaware corporation ("PIA Delaware"), SG
Acquisition, Inc., a Nevada corporation ("PIA Acquisition"), PIA Merchandising
Co., Inc., a California corporation ("PIA California") (PIA Delaware, PIA
Acquisition and PIA California are sometimes referred to herein individually as
a "PIA Party" and collectively as the "PIA Parties"), SPAR Acquisition, Inc., a
Nevada corporation ("SAI"), SPAR Marketing, Inc., a Delaware corporation
("SMI"), SPAR Marketing, Inc., a Nevada Corporation ("SMNEV"), SPAR Marketing
Force, Inc., a Nevada corporation ("SMF"), SPAR, Inc., a Nevada corporation
("SINC"), SPAR/Burgoyne Retail Services, Inc., an Ohio corporation ("SBRS"),
SPAR Incentive Marketing, Inc., a Delaware corporation ("SIM"), SPAR Trademarks,
Inc. ("STM") and SPAR MCI Performance Group, Inc., a Delaware corporation
("SMCI") (SAI, SMI, SMNEV, SMF, SINC, SBRS, SIM, STM and SMCI are sometimes
referred to herein individually as a "SPAR Party" and collectively as the "SPAR
Parties"), and Robert G. Brown and William H. Bartels (each a "SPAR Principal,"
and collectively the "SPAR Principals"). SMNEV, SMF, SINC and SBRS are sometimes
referred to herein individually as a "SPAR Marketing Company" and collectively
as the "SPAR Marketing Companies". The PIA Parties and the SPAR Parties are
sometimes referred to herein individually as a "Merger Party" and collectively
as the "Merger Parties". The Merger Parties and the SPAR Principals are
sometimes referred to herein individually as a "Party" and collectively as the
"Parties".

RECITALS

A. The PIA Parties have entered into the Merger Agreement with the SPAR
Parties (as "Merger Agreement" and the other capitalized terms used and not
otherwise defined in these Recitals are defined in Article I, below).

B. The SPAR Principals collectively own a majority of the issued and
outstanding shares of capital stock of the SPAR Parties.

C. The SPAR Principals also own all of the issued and outstanding shares of
capital stock, and are officers and directors, of SPAR Marketing Services, Inc.
("SMS"), which provides certain field services to the SPAR Marketing Companies
pursuant to the Field Service Agreement. SMS is not a party to the Merger
Agreement, will remain an independent company, and will continue to provide
certain field services to the SPAR Marketing Companies pursuant to the Field
Services Agreement.

D. SMS has historically provided certain field services to the SPAR
Marketing Companies though persons classified by SMS as independent contractors.
The IRS has sought to reclassify certain independent contractors of SMS to
employees, which SMS believes inconsistent with law and fact and is vigorously
contesting.

E. SMF is the issuer of the ADVO Note, which is "payable in an amount equal
to ten percent (10.00%) of, and solely out of, any Equity Proceeds raised
through December 31, 1999, up to a maximum contingent payment of
$3,000,000.00 . . .", with "Equity Proceeds" defined as "the net proceeds raised
in any public offerings or private placements of equity securities issued
by . . ." SMF.

F. In order to induce the Merger Parties to enter into the Merger
Agreement, to permit the SPAR Principals to continue to contest the
reclassification of certain independent contractors of SMS sought by the IRS,
and to permit the SPAR Principals to contest any claim for payment under the
ADVO Note, the SPAR Principals have agreed to indemnify the Merger Parties under
certain circumstances, all upon the terms and provisions and subject to the
conditions set forth herein.

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AGREEMENT

In consideration of the foregoing, the mutual covenants and agreements
hereinafter set forth, and other good and valuable consideration (the receipt
and adequacy of which is hereby acknowledged by the Parties), the Parties hereto
hereby agree as follows:

ARTICLE I

DEFINITIONS

Capitalized terms used and not otherwise defined herein shall have the
meanings respectively assigned to them in the Merger Agreement. Each use in this
Agreement of a neuter pronoun shall be deemed to include references to the
masculine and feminine variations thereof, and vice versa, and a singular
pronoun shall be deemed to include a reference to the plural variation thereof,
and vice versa, in each case as the context may permit or require. As used in
this Agreement, the following capitalized terms and non-capitalized words and
phrases shall have the meanings respectively assigned to them below, which
meanings shall be applicable equally to the singular and plural forms of the
terms so defined:

"ADVO Claim" shall have the meaning assigned to it in Section 3.03 hereof.

"ADVO Defense Expense" shall mean any cost or expense of any SPAR Principal
or any other person authorized by any SPAR Principal incurred in any ADVO
Defense Proceeding, including (without limitation) any and all reasonable fees,
disbursements and expenses of attorneys, accountants and other professionals and
expenses of investigation.

"ADVO Note" shall mean the Amended and Restated Contingent Subordinated
Promissory Note in the maximum principal amount of $3,000,000.00 dated as of
June 30, 1997, issued by SMF to the MF Sellers to evidence the remaining
deferred portion of the "Cash Purchase Price" payable under (and as defined in)
Section 1(C) and 1(D) of the ADVO Purchase Amendment, as the same may be
modified, amended or restated from time to time in the manner provided therein.

"ADVO Note Claim" shall have the meaning assigned to it in Section 3.02
hereof.

"ADVO Defense Proceeding" shall mean any effort by any SPAR Principal or
any other person authorized by any SPAR Principal (i) to oppose or otherwise
contest any legal proceeding by any MF Seller to enforce any claim for payment
under the ADVO Note or (ii) to seek a declaratory judgment that no amount is due
or owing under the ADVO Note, including (without limitation) proceedings
declaratory judgments and similar relief.

"ADVO Purchase Agreement" shall mean the Asset Purchase and Sale Agreement
dated as of March 1, 1996, among Stighen, Inc., a Delaware corporation, ADVO
Investment Company, Inc., a Delaware corporation, and ADVO, Inc., a Delaware
corporation (each a "MF Seller" and collectively the "MF Sellers"), and SMF as
purchaser, as amended by the ADVO Purchase Amendment, and as the same may be
supplemented, modified, amended, restated or replaced from time to time in the
manner provided therein.

"ADVO Purchase Amendment" shall mean the First Amendment to Asset Purchase
and Sale Agreement among the MF Sellers and SMF dated as of June 30, 1997.

"Applicable Law" shall mean any applicable law, ordinance, or governmental
rule or regulation.

"Authority" shall mean the Internal Revenue Service, any state tax
authority, the Pension Benefit Guaranty Corporation, any federal or state court,
or any other governmental authority having jurisdiction over any SMS Employment
Tax or SMS Benefit Claim.

"Benefit Plan" of a referenced party shall mean each Pension Plan, Welfare
Plan and Other ERISA Benefit of the referenced party.

"Code" shall mean the Internal Revenue Code of 1986, as amended, , and the
rules and regulations promulgated thereunder, as the same may be supplemented,
modified, amended, restated or replaced from time to time.

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"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended, and the rules and regulations promulgated thereunder, as the same may
be supplemented, modified, amended, restated or replaced from time to time.

"Field Service Agreement" shall mean the Service Agreement between SMF and
SMS dated as of January 4, 1999, as the same may be supplemented, modified,
amended, restated or replaced from time to time in the manner provided therein.

"Losses" shall mean any and all claims, damages, losses, liabilities,
actions, suits, proceedings, demands, assessments, adjustments, costs and
expenses, including (without limitation) reasonable fees, disbursements and
expenses of attorneys, accountants and other professionals and expenses of
investigation (including, without limitation, all reasonable fees, disbursements
and expenses incurred in seeking to enforce any provision of this Agreement),
but excluding any consequential, special and punitive damages.

"Merger Agreement" shall mean the Agreement and Plan of Merger among the
PIA Parties and the SPAR Parties dated as of February [date], 1999, as the same
may be supplemented, modified, amended, restated or replaced from time to time
in the manner provided therein.

"Merger Party" and "Merger Parties" shall have the meanings respectively
assigned to them in the Introduction, above.

"Merger Party Benefit Claim" shall have the meaning assigned to it in
Section 2.03(b) hereof.

"Merger Party Claim" shall have the meaning assigned to it in Section
2.05(b) hereof.

"Merger Party Expense Claim" shall have the meaning assigned to it in
Section 2.04(b) hereof.

"Merger Party Plan" shall mean any Benefit Plan or the assets of any
Benefit Plan sponsored or maintained after the Closing by any of the Merger
Parties or their affiliates.

"Merger Party Tax Claim" shall have the meaning assigned to it in Section
2.02(b) hereof.

"Other ERISA Benefit" of a referenced party shall mean any material plan or
agreement governed by ERISA or the Code of the referenced party relating to
deferred compensation, bonus and performance compensation (other than salesmen
commissions), stock purchase, stock option, stock appreciation, severance,
vacation, sick leave, holiday fringe benefits, personnel policy, reimbursement
program, insurance, welfare or similar plan, program, policy or arrangement.

"Pension Plan" of a referenced party shall mean each material "employee
pension benefit plan" (as defined in Section 3(2) of ERISA) of the referenced
party.

"PIA Acquisition" shall have the meaning assigned to it in the
Introduction, above.

"PIA Delaware" shall have the meaning assigned to it in the Introduction,
above.

"PIA California" shall have the meaning assigned to it in the Introduction,
above.

"PIA Party" and "PIA Parties" shall have the meanings respectively assigned
to them in the Introduction, above.

"Representatives" shall mean any and all of a referenced person's officers,
directors, employees, stockholders, subsidiaries, affiliates, attorneys, agents,
successors and assigns.

"SAI" shall have the meaning assigned to it in the Introduction, above.

"SBRS" shall have the meaning assigned to it in the Introduction, above.

"SIM" shall have the meaning assigned to it in the Introduction, above.

"SINC" shall have the meaning assigned to it in the Introduction, above.

"SMF" shall have the meaning assigned to it in the Introduction, above.

"SMI" shall have the meaning assigned to it in the Introduction, above.

"SMNEV" shall have the meaning assigned to it in the Introduction, above.

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"SMS" shall have the meaning assigned to it in the Recitals, above.

"SMS Benefit Claim" shall have the meaning assigned to it in Section
2.03(a) hereof.

"SMS Benefit Liability" shall mean any liability with respect to any SMS
Benefit Plan imposed under the Code, ERISA or any other Applicable Law on SMS,
the SPAR Marketing Companies, any pre-merger affiliate of any of the SPAR
Parties, or the SPAR Principals (as stockholders of SMS) with respect to any
period (or partial period) ending on or prior to the Closing Date as a result of
any SMS Field Reclassification.

"SMS Benefit Plan" shall mean any Benefit Plan of SMS, the SPAR Marketing
Companies, any pre-merger affiliate of any of the SPAR Parties; excluding,
however, any and all employee stock options disclosed or issued pursuant to the
Merger Agreement.

"SMS Claim" shall have the meaning assigned to it in Section 2.05(a)
hereof.

"SMS Defense Expense" shall mean any cost or expense of SMS, any SPAR
Principal or any other person authorized by SMS or any SPAR Principal incurred
in any SMS Tax Proceeding, including (without limitation) any and all reasonable
fees, disbursements and expenses of attorneys, accountants and other
professionals and expenses of investigation.

"SMS Employment Tax" shall mean any Tax imposed under the Code or any other
Applicable Law (including, without limitation, any social security (FICA),
federal or state unemployment (FUTA), federal or state withholding or payroll,
or any similar tax) on SMS, the SPAR Marketing Companies, any pre-merger
affiliate of any of the SPAR Parties, or the SPAR Principals (as stockholders of
SMS) with respect to any Tax period (or partial period) ending on or prior to
the Closing Date.

"SMS Expense Claim" shall have the meaning assigned to it in Section
2.04(a) hereof.

"SMS Field Reclassification" shall mean any reclassification of the
independent contractors engaged as field representatives by SMS from independent
contractors to employees of SMS, whether such change was to apply either
prospectively or retroactively, and whether such change in status would affect
periods before or after the Closing Date.

"SMS Tax Claim" shall have the meaning assigned to it in Section 2.02(a)
hereof.

"SMS Tax Proceeding" shall mean any efforts by SMS, any SPAR Principal or
any other person authorized by SMS or any SPAR Principal to oppose or otherwise
contest any efforts by the IRS or any other Authority (i) to effect an SMS Field
Reclassification or (ii) to impose any SMS Employment Tax or SMS Benefit
Liability that would result from an SMS Field Reclassification, including
(without limitation) proceedings seeking refunds, declaratory judgments and
similar relief.

"SMCI" shall have the meaning assigned to it in the Introduction, above.

"SPAR Marketing Company" and "SPAR Marketing Companies" shall have the
meanings respectively assigned to them in the Introduction, above.

"SPAR Party" and "SPAR Parties" shall have the meanings respectively
assigned to them in the Introduction, above.

"STM" shall have the meaning assigned to it in the Introduction, above.

"Tax" and "Taxes" shall respectively mean any and all federal, state, local
or foreign taxes, assessments, interest, fines, penalties, deficiencies, fees
and other governmental charges or impositions (including without limitation all
income tax, unemployment compensation, social security, payroll, withholding,
sales and use, excise, privilege, property, ad valorem, franchise, license,
school and any other tax or similar governmental charge or imposition), and
interest and penalties therein, under the Applicable Laws of the United States
or any state or Municipal or political subdivision thereof or any foreign
country or political subdivision thereon.

"Tax Return" shall mean any federal, state, local or foreign tax return,
report, statement or other similar filing required to be filed by any SPAR Party
with respect to any Tax.

"Welfare Plan" of a referenced party shall mean each material "employee
welfare benefit plan" (as defined in Section 3(i) of ERISA) of the referenced
party.

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ARTICLE II

SMS FIELD RECLASSIFICATION INDEMNIFICATION

From and after the Closing Date (but if and only if the Merger shall have
occurred under the Merger Agreement):

SECTION 2.01. Indemnification by the SPAR Principals respecting a SMS Field
Reclassification. The SPAR Principals, jointly and severally, shall indemnify,
defend and hold harmless the Merger Parties and their respective Representatives
from and against any and all Taxes and related Losses incurred by any of them
with respect to any period (or partial period) ending on or before the Closing
Date as a result of any SMS Employment Tax, SMS Benefit Liability or SMS Defense
Expense not paid or otherwise satisfied by SMS or the SPAR Principals (as the
case may be) to the extent finally determined to be due as a result of or
related to any applicable SMS Field Reclassification or related SMS Tax
Proceeding. The SPAR Principals' obligation to indemnify, defend or hold
harmless the Merger Parties and their respective Representatives from any such
liability shall terminate 30 days after the expiration of the applicable statute
of limitations in respect of such liability (other than with respect to
proceedings pending at the time of expiration, which shall continue with respect
to such proceedings until such proceedings are finally resolved).

SECTION 2.02. Notice of Indemnifiable Employment Tax Claims.

(a) If a claim by any taxing Authority should be made against SMS or any
other entity that is or was under common control at any time with SMS or any of
the SPAR Parties seeking, if and to the extent determined adversely to SMS, a
SMS Field Reclassification and resulting payment of any SMS Employment Taxes
(including any such claims existing on the Closing Date, a "SMS Tax Claim"), the
SPAR Principals shall promptly (but in any event within ten Business Days) give
written notice to PIA Delaware of such claim (except for the continuation of the
SMS Tax Claim and related proceedings disclosed in the SPAR Disclosure Letter);
provided, however, that the failure to give such notice shall not affect the
indemnification provided hereunder except to the extent the Merger Parties have
actually been prejudiced as a result of such failure.

(b) If a claim should be made against any of the Merger Parties or their
subsidiaries by any taxing Authority for payment by any Merger Party of any SMS
Employment Taxes that, if and to the extent determined adversely to such Merger
Party, would result in an indemnity payment to the Merger Parties or any of
their affiliates pursuant to Section 2.01 hereof (a "Merger Party Tax Claim"),
the Merger Parties shall give written notice to the SPAR Principals of such
claim within ten Business Days; provided, however, that the failure to give such
notice shall not affect the indemnification provided hereunder except to the
extent the SPAR Principals have actually been prejudiced as a result of such
failure.

SECTION 2.03. Notice of Indemnifiable Benefit Plan Claims.

(a) If a claim by any taxing Authority or other person(s) should be made
against SMS or any other any other entity that is or was under common control at
any time with any of the SPAR Parties seeking, if and to the extent determined
adversely to SMS, a SMS Field Reclassification with respect to any SMS Benefit
Plan and resulting payment of any SMS Benefit Liability (a "SMS Benefit Claim"),
the SPAR Principals shall promptly (but in any event within ten Business Days)
give written notice to PIA Delaware of such claim; provided, however, that the
failure to give such notice shall not affect the indemnification provided
hereunder except to the extent the Merger Parties have actually been prejudiced
as a result of such failure.

(b) If a claim should be made against any of the Merger Parties or their
subsidiaries, or against any Merger Party Plan, by any taxing Authority or other
person(s) for payment by any Merger Party or Merger Party Plan of any SMS
Benefit Liability that, if and to the extent determined adversely to such Merger
Party or Merger Party Plan, would result in an indemnity payment to the Merger
Parties or any of their affiliates pursuant to Section 2.01 hereof (a "Merger
Party Benefit Claim"), the Merger Parties shall give written notice to the SPAR
Principals of such claim within ten Business Days; provided, however, that the
failure to give such notice shall not affect the indemnification provided
hereunder except to the extent the SPAR Principals have actually been prejudiced
as a result of such failure.

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SECTION 2.04. Notice of Indemnifiable SMS Defense Expense Claims.

(a) If a claim by any person should be made against SMS or the SPAR
Principals seeking legal enforcement of any unpaid bona fide SMS Defense Expense
amount contested by SMS or the SPAR Principals (including any such claims
existing on the Closing Date, a "SMS Expense Claim"), the SPAR Principals shall
promptly (but in any event within ten Business Days) give written notice to PIA
Delaware of such claim; provided, however, that the failure to give such notice
shall not affect the indemnification provided hereunder except to the extent the
Merger Parties have actually been prejudiced as a result of such failure.

(b) If a claim should be made seeking collection or legal enforcement
against any Merger Party of any unpaid bona fide SMS Defense Expense amount not
paid by SMS or the SPAR Principals that, if and to the extent determined
adversely to such Merger Party, would result in an indemnity payment to the
Merger Parties or any of their affiliates pursuant to Section 2.01 hereof (a
"Merger Party Expense Claim"), the Merger Parties shall give written notice to
the SPAR Principals of such claim within ten Business Days; provided, however,
that the failure to give such notice shall not affect the indemnification
provided hereunder except to the extent the SPAR Principals have actually been
prejudiced as a result of such failure.

SECTION 2.05. Procedures regarding SMS Tax and Benefit Claims.

(a) With respect to any SMS Tax Claim, SMS Benefit Claim or SMS Expense
Claim (each an "SMS Claim") and each Merger Party Tax Claim, Merger Party
Benefit Claim or Merger Party Expense Claim (each a "Merger Party Claim"), the
SPAR Principals (i) shall control all proceedings, (ii) shall make all decisions
taken in connection with such SMS Claim or Merger Party Claim, including
(without limitation) selection of counsel and whether to pursue or forego any
and all administrative appeals, proceedings, hearings and conferences with any
taxing Authority with respect thereto, (iii) shall decide whether (A) to pay any
or otherwise satisfy any Tax or benefit claimed, (B) to settle such SMS Claim or
Merger Party Claim (subject to subsection (b) of this Section, below), (C) to
sue for a refund where applicable law permits such refund suits, or (D) to
contest the SMS Claim or Merger Party Claim in any permissible manner, and (iv)
shall pay or otherwise settle any and all bonafide SMS Defense Expenses, and the
costs of contesting or settling the same, not paid by SMS. This provision will
not reduce or otherwise alter the Merger Parties' rights or the SPAR Principals'
obligations regarding indemnification of any Merger Party pursuant to Section
2.01 or 2.02 hereof, respectively.

(b) If SMS or the SPAR Principals desire to enter into a settlement or
resolution with the relevant taxing Authority regarding any Merger Party Claim
and are permitted to do so, or not restricted from doing so, under this Section,
SMS or the SPAR Principals may enter such settlement or resolve such Merger
Party Claim if the terms of such settlement or resolution (1) provides that no
person (other than any person that was engaged as an independent contractor,
notwithstanding any reclassification of status, by SMS with respect to his or
her own Taxes and SMS pursuant to such settlement) shall have any further
obligation to the taxing Authority with respect to such Merger Party Claim, (2)
requires that SMS or the SPAR Principals pay the taxing Authority any amounts
due under the terms of the settlement or resolution, and (3) does not purport to
bind any Merger Party to act in any manner, including (without limitation)
requiring any Merger to reclassify as an employee any person engaged by it as an
independent contractor, unless such Merger Party has agreed to be so bound in
such Merger Party's sole discretion.

(c) PIA Delaware shall have the right to join in the defense of any Merger
Party Claim at its own expense. The SPAR Principals shall make available to PIA
Delaware all documents and any other items or information reasonably requested
by it for full and active participation in such defense by PIA Delaware.

(d) The Merger Parties shall not pay or offer or agree to pay, settle or
otherwise resolve any Merger Party Claim without the SPAR Principals' express
written consent, which consent shall not be withheld unreasonably. If PIA
Delaware gives written notice to the SPAR Principals of the Merger Parties'
desire to accept a settlement or resolution of any Merger Party Claim, and the
SPAR Principals elect not to approve or enter into such settlement or resolution
(as applicable), then: (i) the SPAR Principals shall have two years from the
date of receipt by the SPAR Principals of the notice to settle or otherwise
resolve the Merger Party Claim; and (ii) if after the expiration of such two
year period the SPAR Principals have not resolved such Merger Party Claim, PIA
Delaware shall be permitted to settle such Merger Party Claim if the terms of
such settlement or resolution (1) does not concede or agree to a SMS Field
Reclassification, (2) are on terms

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substantially similar (but including any additional interest and penalties
accrued during the two year period) to those offered at the time PIA Delaware
provided notice to the SPAR Principals of PIA Delaware's desire to settle, and
(3) requires that PIA Delaware pay the taxing Authority any amounts due under
the terms of the settlement or resolution, subject to its right to
indemnification hereunder. This provision will not reduce or otherwise alter the
Merger Parties' rights or the SPAR Principals' obligations regarding
indemnification of any Merger Party pursuant to Section 2.01 hereof.

(e) No Effect on the Parties. This Agreement is not intended to, and shall
not be construed to, limit in any way the right of any Party to conduct its
business in any manner it may elect, including (without limitation) classifying
persons engaged by such Party to provide services as employees or independent
contractors as such Party may deem appropriate.

ARTICLE III

ADVO NOTE INDEMNIFICATION

From and after the Closing Date (but if and only if the Merger shall have
occurred under the Merger Agreement):

SECTION 3.01. ADVO Note Indemnification. The SPAR Principals, jointly and
severally, shall indemnify, defend and hold harmless the Merger Parties and
their respective Representatives from and against any and all Losses incurred by
any of them as a result of any ADVO Note Claim or ADVO Expense Claim not paid or
otherwise satisfied by SMS or the SPAR Principals (as the case may be) to the
extent and in the amount finally determined to be due (if and to the extent
determined adversely to SMS). The SPAR Principals' obligation to indemnify,
defend or hold harmless the Merger Parties and their respective Representatives
from any such liability shall terminate 30 days after the expiration of the
applicable statute of limitations in respect of such liability (other than with
respect to proceedings pending at the time of expiration, which shall continue
with respect to such proceedings until such proceedings are finally resolved).

SECTION 3.02. Notice of ADVO Note Claim.

(a) If a claim should be made by any MF Seller seeking collection or legal
enforcement against any Merger Party of any amount under the ADVO Note not paid
or otherwise satisfied by SMS or the SPAR Principals (an "ADVO Note Claim"), the
Merger Parties shall give written notice to the SPAR Principals of such claim
within ten Business Days; provided, however, that the failure to give such
notice shall not affect the indemnification provided hereunder except to the
extent the SPAR Principals have actually been prejudiced as a result of such
failure.

(b) If a claim should be made seeking collection or legal enforcement
against any Merger Party of any bona fide ADVO Defense Expense amount not paid
or otherwise satisfied by SMS or the SPAR Principals (an "ADVO Expense Claim"),
the Merger Parties shall give written notice to the SPAR Principals of such
claim within ten Business Days; provided, however, that the failure to give such
notice shall not affect the indemnification provided hereunder except to the
extent the SPAR Principals have actually been prejudiced as a result of such
failure.

SECTION 3.03 Procedures regarding ADVO Note Claims.

(a) The SPAR Principals (i) shall control all proceedings, (ii) shall make
all decisions taken in connection with any ADVO Note Claim or ADVO Expense Claim
(each an "ADVO Claim"), including (without limitation) selection of counsel and
whether to pursue or forego any and all administrative appeals, proceedings,
hearings and conferences with any court or other judicial Authority with respect
thereto, (iii) shall decide whether (A) to pay any or otherwise satisfy any
amount claimed, (B) to settle such ADVO Claim, or (C) to contest the ADVO Claim
in any permissible manner, and (iv) shall pay or otherwise settle any and all
bonafide ADVO Defense Expenses, and the costs of contesting or settling the
same, not paid by SMS. This provision will not reduce or otherwise alter the
Merger Parties' rights or the SPAR Principals' obligations regarding
indemnification of any Merger Party pursuant to Section 3.01 hereof.

(b) If SMS or the SPAR Principals desire to enter into a settlement or
resolution with the relevant MF Sellers, SMS or the SPAR Principals may enter
such settlement or resolve such ADVO Claim if the terms of

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such settlement or resolution (1) provides that no person shall have any further
obligation to the MF Sellers with respect to the ADVO Claim or the ADVO Note,
and (2) requires that SMS or the SPAR Principals pay any amounts due under the
terms of the settlement or resolution.

(c) PIA Delaware shall have the right to join in the defense of any ADVO
Claim at its own expense. The SPAR Principals shall make available to PIA
Delaware all documents and any other items or information reasonably requested
by it for full and active participation in such defense by PIA Delaware.

(d) The Merger Parties shall not pay or offer or agree to pay, settle or
otherwise resolve any ADVO Claim without the SPAR Principals' express written
consent, which consent shall not be withheld unreasonably.

ARTICLE IV

LIMITS ON INDEMNIFICATIONS

Notwithstanding the provisions of Articles II and III hereof:

SECTION 4.01. Related Group as Single Indemnified Party. For purposes of
this Agreement, the Merger Parties and their Representatives (collectively, the
"Indemnified Parties") shall be considered to be a single indemnified Party.

ARTICLE V

GENERAL

SECTION 5.01. Successors and Assigns; Assignment. Whenever in this
Agreement reference is made to any Party or other person, such reference shall
be deemed to include the successors, assigns, heirs and legal representatives of
such person, and, without limiting the generality of the foregoing, this
Agreement shall be binding upon and shall inure to the benefit of the Parties
hereto and their respective successors and assigns; provided that the rights of
a Party hereunder may not be assigned without the consent of the other Parties
hereto.

SECTION 5.02. No Third Party Rights. The representations, warranties and
other terms and provisions of this Agreement are for the exclusive benefit of
the Parties hereto and the persons entitled to indemnification hereunder, and,
except as otherwise expressly provided herein or therein, no other person,
including creditors of any Party or any such indemnifiable person, shall have
any right or claim against any Party by reason of any of those terms and
provisions or be entitled to enforce any of those terms and provisions against
any Party.

SECTION 5.03. Counterparts. This Agreement may be executed in two or more
counterpart copies of the entire document or of signature pages to the document,
each of which may be executed by one or more of the Parties hereto, but all of
which, when taken together, shall constitute a single agreement binding upon all
of the Parties hereto.

SECTION 5.04. Expenses. The PIA Parties shall pay the fees, expenses and
disbursements of the PIA Parties and their respective Representatives incurred
in connection with the preparation and negotiation of this Agreement; and the
SPAR Principals shall pay the fees, expenses and disbursements of the SPAR
Principals and their respective Representatives incurred in connection with the
preparation and negotiation of this Agreement.

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SECTION 5.05. Notices. All notices, requests and other communications
hereunder shall be in writing and shall be sent, delivered or mailed as follows:

(a) If to any PIA Party:
Terry R. Peets, President and Chief Executive Officer
PIA Merchandising Services, Inc.
19900 MacArthur Blvd., Suite 900
Irvine, California 92612
Telephone:            (949) 474-3506
Telecopier:            (949) 474-3570
E-Mail:                Terry.Peets@PIAmerch.com

with a copy to:
James W. Loss, Esq.
Riordan & McKinzie
695 Town Center Drive, Suite 1500
Costa Mesa, CA 92626
Telephone:            (714) 433-2900
Telecopier:            (714) 549-3244
E-Mail:                jwl@riordan.com

And a copy to:
Lawrence David Swift, Esq.
Parker Chapin Flattau & Klimpl, LLP
1211 Avenue of the Americas
New York, NY 10036-8735
Telephone:            (212) 704-6147
Telecopier:            (212) 704-6159
E-Mail:                LDSwift@PCFK.com

(b) If to any SPAR Party:
Robert G. Brown, Chairman, Chief Executive Officer
SPAR Marketing Force, Inc.
303 South Broadway, Suite 140
Tarrytown, New York 10591
Telephone:            (914) 332-4100
Telefax:                (914) 332-0741
E-Mail:                RBrown@MSN.com

With a copy to:
William H. Bartels, Vice Chairman and Senior Vice President
SPAR Marketing Force, Inc.
303 South Broadway, Suite 140
Tarrytown, New York 10591
Telephone:            (914) 332-4100
Telefax:                (914) 332-0741
E-Mail:                BBartels@SPARinc.com

and a copy to:
Lawrence David Swift, Esq.
Parker Chapin Flattau & Klimpl, LLP
121 1 Avenue of the Americas
New York, NY 10036-8735
Telephone:            (212) 704-6147
Telecopier:            (212) 704-6159
E-Mail:                LDSwift@PCFK.com

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(c) If to Robert G. Brown:
Robert G. Brown, Chairman, Chief Executive Officer
c/o SPAR Marketing Force, Inc.
303 South Broadway, Suite 140
Tarrytown, New York 10591
Telephone:            (914) 332-4100
Telefax:                (914) 332-0741
E-Mail:                RBrown@MSN.com

If to William H. Bartels:
William H. Bartels, Vice Chairman and Senior Vice President
SPAR Marketing Force, Inc.
303 South Broadway, Suite 140
Tarrytown, New York 10591
Telephone:            (914) 332-4100
Telefax:                (914) 332-0741
E-Mail:                BBartels@SPARinc.com

with a copy, in either case, to:
Lawrence David Swift, Esq.
Parker Chapin Flattau & Klimpl, LLP
1211 Avenue of the Americas
New York, NY 10036-8735
Telephone:            (212) 704-6147
Telecopier:            (212) 704-6159

Each such notice, request or other communication shall be given by hand
delivery, by nationally recognized courier service or by telecopier, receipt
confirmed. Each such notice, request or communication shall be effective (i) if
delivered by hand or by nationally recognized courier service, when delivered at
the address specified in this Section (or in accordance with the latest
unrevoked written direction from such Party) and (ii) if given by telecopier,
when such telecopy is transmitted to the telecopier number specified in this
Section (or in accordance with the latest unrevoked written direction from such
Party), and the appropriate confirmation is received.

SECTION 5.06. Governing Law. This Agreement shall be governed by and
construed in accordance with the Applicable Laws pertaining in the State of New
York (other than those laws that would defer to the substantive laws of another
jurisdiction). Without in any way limiting the preceding choice of law, the
parties intend (among other things) to thereby avail themselves of the benefit
of Section 5-1401 of the General Obligations Law of the State of New York.

SECTION 5.07. Consent to Jurisdiction, Etc. The Parties each hereby consent
and agree that the Supreme Court of the State of New York for the County of
Westchester and the United States District Court for Westchester County, New
York, each shall have personal jurisdiction and proper venue with respect to any
dispute between the Parties; provided that the foregoing consent shall not
deprive any Party of the right to voluntarily commence or participate in any
action, suit or proceeding in any other court having jurisdiction and venue over
the other Parties. In any dispute with the SPAR Principals, the PIA Parties will
not raise, and each hereby expressly waives, any objection or defense to any
such New York jurisdiction as an inconvenient forum. Without in any way limiting
the preceding consents to jurisdiction and venue, the parties intend (among
other things) to thereby avail themselves of the benefit of Section 5-1402 of
the General Obligations Law of the State of New York.

SECTION 5.08. Waiver of Jury Trial. In any action, suit or proceeding in
any jurisdiction, the Parties each hereby expressly waive trial by jury.

SECTION 5.09. Exercise of Rights and Remedies. Except as otherwise provided
herein, no delay of or omission in the exercise of any right, power or remedy
accruing to any Party as a result of any breach or default by any other Party
under this Agreement shall impair any such right, power or remedy, nor shall it
be construed as a waiver of or acquiescence in any such breach or default, or of
any similar breach or default
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occurring later. No waiver of any single breach or default shall be deemed a
waiver of any other breach or default occurring before or after such waiver.

SECTION 5.10. Reformation and Severability. In case any provision of this
Agreement shall be invalid, illegal or unenforceable, it shall, to the extent
possible, be modified in such manner as to be valid, legal and enforceable but
so as to most nearly retain the intent of the parties, and if such modification
is not possible, such provision shall be severed from this Agreement, and in
either case, the validity, legality and enforceability of the remaining
provisions of this Agreement shall not in any way be affected or impaired
thereby.

SECTION 5.11. Remedies Cumulative. No right, remedy or election given by
any term of this Agreement shall be deemed exclusive, but each shall be
cumulative with all other rights, remedies and elections available at law or in
equity.

SECTION 5.12. Captions. The headings of this Agreement are inserted for
convenience only and shall not constitute a part of this Agreement or be used to
construe or interpret any provision hereof.

SECTION 5.13. Amendments. This Agreement may be modified or amended only by
a written instrument executed by the SPAR Principals and the PIA Parties.

SECTION 5.14. Entire Agreement. This Agreement and the other Merger
Documents to which the Parties are a party constitute the entire agreement and
understanding among the Parties, and supersede any prior agreements and
understandings, relating to the subject matter of this Agreement.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

PIA MERCHANDISING SERVICES, INC.                         SPAR ACQUISITION, INC.
By:                                                      By:
-----------------------------------------------------
-----------------------------------------------------        Name: Robert G. Brown
Name: Terry R. Peets                                     Title:Chairman, Chief Executive Officer and
Title:President and Chief Executive Officer                    President

SG ACQUISITION, INC.                                     SPAR MARKETING FORCE, INC.
By:                                                      By:
-----------------------------------------------------
-----------------------------------------------------        Name: Robert G. Brown
Name: Terry R. Peets                                     Title:Chairman, Chief Executive Officer and
Title:President and Chief Executive Officer                    President

PIA MERCHANDISING CO., INC.                              SPAR, INC.
By:                                                      By:
-----------------------------------------------------
-----------------------------------------------------        Name: Robert G. Brown
Name: Terry R. Peets                                     Title:Chairman, Chief Executive Officer and
Title:President and Chief Executive Officer                    President

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SPAR/BURGOYNE RETAIL SERVICES, INC.                      SPAR MARKETING, INC., A DELAWARE CORPORATION
By:                                                      By:
-------------------------------------------------        -------------------------------------------------
Name: Robert G. Brown                                    Name: Robert G. Brown
Title:Chairman, Chief Executive Officer and President          Title:Chairman, Chief Executive Officer and
President

SPAR MCI RETAIL SERVICES, INC.                           SPAR TRADEMARKS, INC.
By:                                                      By:
-----------------------------------------------------
-----------------------------------------------------        Name: Robert G. Brown
Name: Robert G. Brown                                    Title:Chairman, Chief Executive Officer and
Title:Chairman, Chief Executive Officer and                    President
President

SPAR MARKETING, INC., A NEVADA CORPORATION
By:
-----------------------------------------------------
Name: Robert G. Brown
Title:Chairman and Chief Executive Officer

-----------------------------------------------------    -----------------------------------------------------
Robert G. Brown                                                           William H. Bartels

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EXHIBIT H

INDEMNITY ESCROW AGREEMENT

INTRODUCTION

This Indemnity Escrow Agreement, dated as of [Closing Date], 1999 (as the
same may be supplemented, modified, amended, restated or replaced from time to
time in the manner provided herein, this "Agreement"), is by and among PIA
MERCHANDISING SERVICES, INC., a Delaware corporation ("PIA Delaware"), SG
ACQUISITION, INC., a Nevada corporation ("PIA Acquisition"), PIA MERCHANDISING
CO., INC., a California corporation ("PIA California") (PIA Delaware, PIA
Acquisition and PIA California are sometimes referred to herein individually as
a "PIA Party" and collectively as the "PIA Parties"), SPAR ACQUISITION, INC., a
Nevada corporation ("SAI"), SPAR MARKETING, INC., a Delaware corporation
("SMI"), SPAR Marketing, Inc., a Nevada corporation ("SMNEV"), SPAR MARKETING
FORCE, INC., a Nevada corporation ("SMF"), SPAR, INC., a Nevada corporation
("SINC"), SPAR/BURGOYNE RETAIL SERVICES, INC., an Ohio corporation ("SBRS"),
SPAR INCENTIVE MARKETING, INC., a Delaware corporation ("SIM"), SPAR MCI
PERFORMANCE GROUP, INC., a Delaware corporation ("SMCI"), and SPAR TRADEMARKS,
INC., a Nevada Corporation ("STM") (SAI, SMI, SMNEV, SMF, SINC, SBRS, SIM, SMCI
and STM are sometimes referred to herein individually as a "SPAR Party" and
collectively as the "SPAR Parties"), and ROBERT G. BROWN and WILLIAM H. BARTELS
(each a "SPAR Principal,"and collectively the "SPAR Principals"), and PARKER
CHAPIN FLATTAU & KLIMPL, LLP, a New York limited liability partnership having an
address at 1211 Avenue of the Americas, New York, New York 10036, as Escrow
Agent (the "Indemnity Escrow Agent"). The PIA Parties and the SPAR Parties are
sometimes referred to herein individually as a "Merger Party" and collectively
as the "Merger Parties". The Merger Parties and the SPAR Principals are
sometimes referred to herein individually as a "Beneficiary" and collectively as
the "Beneficiaries". The Beneficiaries and the Indemnity Escrow Agent are
sometimes referred to herein individually as a "Party" and collectively as the
"Parties".

RECITALS

A. The Merger Parties have entered into the Agreement and Plan of Merger
dated as of February 28, 1999 (as the same may be supplemented, modified,
amended, restated or replaced from time to time in the manner provided therein,
the "Merger Agreement"), and the Merger Parties and the SPAR Principals (I.E.,
the Beneficiaries) have entered into the Limited Indemnification Agreement dated
as of [Closing Date], 1999 (as the same may be supplemented, modified, amended,
restated or replaced from time to time in the manner provided therein, the
"Limited Indemnification Agreement").

B. The Beneficiaries desire to have shares of common stock of PIA Delaware
("PIA Delaware Stock") deposited in escrow in accordance with Section 2.02 of
the Merger Agreement and held and disbursed by the Indemnity Escrow Agent in
accordance with this Agreement in order to secure the obligations of the SPAR
Principals to the Merger Parties under the Limited Indemnification Agreement,
and the Indemnity Escrow Agent has agreed to receive, hold and disburse such
stock, all upon the terms and subject to the conditions hereinafter set forth.

AGREEMENT

In consideration of the foregoing and the mutual covenants and agreements
hereinafter set forth, the parties hereto hereby agree as follows:

SECTION 1. Escrow of Instruments. (a) In accordance with the provisions of
Section 2.02 of the Merger Agreement, (i) PIA Delaware shall cause ten percent
(10%) of the shares of PIA Delaware Stock that each SPAR Principal and their
Family Members (as defined in the Merger Agreement) would otherwise have had the
right to receive pursuant to Section 2.01(a) (the "Share Escrow Amount") of the
Merger Agreement (the "Escrow Shares") to be registered in the name of the
applicable SPAR Principal and delivered to the Indemnity Escrow Agent, provided
however that the Share Escrow Amount may be satisfied

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by the shares of the SPAR Principals as opposed to the shares of such Family
Members; and (ii) each SPAR Principal shall deposit with the Indemnity Escrow
Agent four stock powers (separate from the certificates) endorsed to PIA
Delaware, all of which shall be held in accordance with the provisions of the
Limited Indemnity Agreement and this Agreement.

(b) The SPAR Principals shall be entitled to vote the Escrow Shares in
accordance with their respective interests therein on all matters submitted to a
vote of the stockholders of PIA Delaware so long as such Escrow Shares are held
in escrow pursuant to the term of this Agreement.

(c) Capitalized terms used and not otherwise defined herein shall have the
meanings respectively assigned to them in the Merger Agreement or the Limited
Indemnification Agreement, as applicable. However, no reference to the Merger
Agreement or the Limited Indemnification Agreement or any other instrument or
document shall be deemed to incorporate any term or provision thereof into this
Agreement unless expressly so provided.

SECTION 2. Investment of Funds. The Indemnity Escrow Agent may invest or
deposit any dividends or other distributions paid with respect to the Escrow
Shares (the "Escrow Funds"; collectively, with the Escrow Shares, the "Escrow
Deposit"), in (a) one of its normal interest bearing escrow deposit accounts
with Citibank, N.A., The Chase Manhattan Bank, or their respective affiliates,
(b) securities issued or guarantied by the United States of America, or (c)
other interest bearing deposit accounts in, or certificates of deposit,
commercial paper or similar products of, or money market mutual funds affiliated
with, (i) domestic commercial banks that have, or are members of a group of
domestic commercial banks that has, consolidated total assets of at least
$1,000,000,000, or (ii) such other banks or other financial institutions as may
be acceptable to the Beneficiaries.

SECTION 3. Release of Funds and Documents. The Indemnity Escrow Agent shall
release the Escrow Shares and other property in the escrow created hereunder as
follows:

(a) the Indemnity Escrow Agent shall release all of the then remaining
Escrow Shares and other property in the Escrow Deposit to the SPAR
Principals, in accordance with their respective interests therein, on the
second Business Day after receipt by the Indemnity Escrow Agent of written
notice from PIA Delaware certifying that the obligations of the SPAR
Principals under the Limited Indemnity Agreement have been satisfied in
full;

(b) the Indemnity Escrow Agent shall release all of the then remaining
Escrow Shares and other property in the Escrow Deposit to the SPAR
Principals, in accordance with their respective interests therein, on the
eleventh Business Day after receipt by the Indemnity Escrow Agent of
written notice (a "Release Notice") from any SPAR Principal certifying that
the obligations of the SPAR Principals under the Limited Indemnity
Agreement have been satisfied in full and certifying that PIA Delaware has
concurrently been given a copy of such Release Notice; provided, however,
that the Escrow Deposit shall not be so released if PIA Delaware delivers
written objection to such release to the Indemnity Escrow Agent prior to
the close of business on the tenth Business Day after the Indemnity Escrow
Agent's receipt of such Release Notice, in which event the Parties shall
resolve such dispute in the manner provided in Section 7 hereof;

(c) the Indemnity Escrow Agent shall release such portion of the
Escrow Shares and/or other property then held in the Escrow Deposit to PIA
Delaware as shall be specified by written notice from PIA Delaware, on the
eleventh Business Day following receipt by the Indemnity Escrow Agent of
such written request from PIA Delaware, acting in its own name or as agent
for any other Beneficiary (an "Indemnity Claim Notice"), which notice shall
(i) concurrently be delivered to the SPAR Principals and the Indemnity
Escrow Agent (and shall include a certification to such effect), (ii) state
that the Escrow Shares and other property requested to be released are
required to satisfy an unpaid claim for indemnification under the Limited
Indemnification Agreement, (iii) set forth the dollar amount of the claim
for indemnification, and (iv) contain such facts and information as are
then reasonably available concerning the basis for the claim for
indemnification; provided, however, that the Indemnity Escrow Agent shall
not release such Escrow Shares or other property as requested if one or
both of the SPAR Principals has delivered written objection to such release
to the Indemnity Escrow Agent prior to the

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close of business on the tenth Business Day following the receipt of such
Indemnity Claim Notice, in which event the Parties shall resolve such
dispute in the manner provided in Section 7 hereof;

(d) the Indemnity Escrow Agent shall release one half of the then
remaining Escrow Shares and Escrow Funds and other property attributable
thereto in the Escrow Deposit to the SPAR Principals, in accordance with
their respective interests therein, if by the close of business on March
31, 2000, the Indemnity Escrow Agent has not received an Indemnity Claim
Notice under Article III of the Limited Indemnification Agreement that then
to its knowledge remains unsatisfied or in dispute (which the Indemnity
Escrow Agent may in its discretion confirm through notices to the
Beneficiaries); provided, however, that the Escrow Deposit shall not be so
released if PIA Delaware delivers written objection to such release and an
Indemnity Claim Notice under Article III of the Limited Indemnification
Agreement to the Indemnity Escrow Agent prior to the close of business on
March 29, 2000, in which event the Parties shall resolve such dispute in
the manner provided in Section 7 hereof;

(e) the Board of Directors of PIA Delaware shall in their board
meetings preceding the second, third and fourth anniversaries of the date
of this Agreement evaluate the amount of collateral reasonably necessary to
continue to secure the SPAR Principals' obligations under the Limited
Indemnification Agreement (the "Continuing Amount"), not to exceed
$1,500,000, and give written notice to the Indemnity Escrow Agent of the
Continuing Amount; and the Indemnity Escrow Agent shall retain Escrow
Shares having a Fair Market Value (as hereinafter defined) equal to the
Continuing Amount and release all the then remaining Escrow Shares and
other property in the Escrow Deposit in excess of the Continuing Amount to
the SPAR Principals, in accordance with their respective interests therein,
if the Indemnity Escrow Agent has received that notice and the Indemnity
Escrow Agent has not received an Indemnity Claim Notice under Article II of
the Limited Indemnification Agreement that then to its knowledge remains
unsatisfied or in dispute (which the Indemnity Escrow Agent may in its
discretion confirm through notices to the Beneficiaries); provided,
however, that the Escrow Deposit shall not be so released if PIA Delaware
delivers written objection to such release and an Indemnity Claim Notice
under Article II of the Limited Indemnification Agreement to the Indemnity
Escrow Agent prior to the close of business on the tenth Business Day prior
to the applicable anniversary of the date hereof, in which event the
Parties shall resolve such dispute in the manner provided in Section 7
hereof; and

(f) the Indemnity Escrow Agent shall release all of the then remaining
Escrow Shares and other property in the Escrow Deposit to the SPAR
Principals, in accordance with their respective interests therein, if by
the close of business on the eleventh Business Day following the fifth
anniversary of the date of this Agreement the Indemnity Escrow Agent has
not received an Indemnity Claim Notice under Article II of the Limited
Indemnification Agreement that then to its knowledge remains unsatisfied or
in dispute (which the Indemnity Escrow Agent may in its discretion confirm
through notices to the Beneficiaries); provided, however, that the Escrow
Deposit shall not be so released if PIA Delaware delivers written objection
to such release and an Indemnity Claim Notice under Article II of the
Limited Indemnification Agreement to the Indemnity Escrow Agent prior to
the close of business on the tenth Business Day after the fifth anniversary
of the date of this Agreement, in which event the Parties shall resolve
such dispute in the manner provided in Section 7 hereof.

In determining the number of Escrow Shares to be transferred in satisfaction of
any claim against the Escrow Property pursuant to the foregoing clause (c) or
retained in escrow (if any) under the foregoing clause (e), each Escrow Share
shall be valued at the average last sale price on the Nasdaq National Market for
the PIA Delaware Stock for the twenty (20) trading days ending two trading days
prior to the date on which such shares are to be transferred or released (the
"Fair Market Value"). PIA Delaware shall notify the Indemnity Escrow Agent in
writing of the appropriate valuation for the Escrow Shares for such purposes.
Each of the SPAR Principals and other Beneficiaries hereby expressly authorizes
and instructs the Indemnity Escrow Agent to take any and all action required to
effect any transfer of Escrow Shares and/or other property pursuant to the terms
of this Agreement, including, without limitation, completing and delivering one
or more of the executed stock powers delivered to the Indemnity Escrow Agent
pursuant to Section 1.

SECTION 4. Substitution of Cash for Escrow Shares. The SPAR Principals
shall have the right at any time and from time to time to substitute cash for
Escrow Shares as follows: (i) the SPAR Principals shall give written notice to
the Indemnity Escrow Agent and the Merger Parties at least ten days prior to any
requested

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substitution; (ii) on or before the proposed substitution date, the SPAR
Principals shall deliver $          [THE PER SHARE FAIR MARKET VALUE AS OF THE
EFFECTIVE TIME] per share in immediately available funds to the Indemnity Escrow
Agent for each share of PIA Delaware Stock to be released in substitution,
provided, however, that to the extent the amount of the Escrow Shares has been
reduced pursuant to Section 3(e) hereof, the per share substitution price for
the each share of PIA Delaware Stock in the Continuing Amount shall instead be
the Fair Market Value as of the business day immediately preceding the day such
written notice is sent; and (iii) upon receipt of such funds by the Indemnity
Escrow Agent, the Indemnity Escrow Agent shall release the corresponding shares
of PIA Delaware Stock to the SPAR Principals, in accordance with their
respective interests therein, whether or not any Indemnity Claim Notice has been
received by the Indemnity Escrow Agent.

SECTION 5. Further Assurances. Each Beneficiary agrees to do such further
acts and things and to execute and deliver such statements, assignments,
agreements, instruments and other documents as the Indemnity Escrow Agent from
time to time reasonably may request in order to effectuate the purpose and the
terms and provisions of this Agreement, each in such form and substance as may
be acceptable to the Indemnity Escrow Agent.

SECTION 6. Invalidation of Distributions, Etc. In the event any amount or
document released to any Beneficiary under this Agreement is invalidated,
declared to be fraudulent or preferential or must otherwise be restored or
returned by the Indemnity Escrow Agent in connection with the insolvency,
bankruptcy or reorganization of any Beneficiary or other person, whether by
order of or settlement before any court or other authority or otherwise: (a)
each Beneficiary shall contribute back to the Indemnity Escrow Agent an amount
received by it such that each Beneficiary will be affected by that invalidation,
declaration, restoration or return ratably in proportion to the distributions it
received under this Agreement; and (b) each Beneficiary will return any document
so affected, together with any related assignment, release or other instrument
or document the Indemnity Escrow Agent may request to restore the status quo
ante.

SECTION 7. Conflicting Demands.

(a) In the event that one or both of the SPAR Principals or PIA Delaware
timely objects to any requested release of or claim against any of the Escrow
Shares or other property pursuant to Section 3, then PIA Delaware and the SPAR
Principals shall, for a period of at least thirty days, negotiate in good faith
in an effort to resolve such dispute. If PIA Delaware and the SPAR Principals
are unable to resolve such dispute within such thirty day period (or such longer
period as they may mutually agree upon), then the Beneficiaries may pursue
non-binding mediation if they mutually agree, or any Beneficiary may commence an
action, to finally resolve any conflicting claims hereunder. The final decision
of any court proceeding shall be furnished in writing to the Indemnity Escrow
Agent.

(b) If conflicting or adverse claims or demands are made or notices served
upon the Indemnity Escrow Agent with respect to the escrow provided for herein,
the Beneficiaries agree that the Indemnity Escrow Agent shall be entitled to
refuse to comply with any such claim or demand and to withhold and stop all
further performance of this escrow so long as such disagreement shall continue.
In so doing, the Indemnity Escrow Agent shall not be or become liable for
damages, losses, expenses or interest to any Beneficiary or any other person for
its failure to comply with such conflicting or adverse demands. The Indemnity
Escrow Agent shall be entitled to continue to so refrain and refuse to so act
until: (a) the rights of the adverse claimants have been finally adjudicated in
a court assuming and having jurisdiction and venue over the parties and/or the
documents, instruments or funds involved herein or affected hereby; and/or (b)
the Indemnity Escrow Agent shall have received an executed copy of a dispositive
settlement agreement to which the Beneficiaries and all other adverse claimants,
if any, are parties and signatories.

(c) If conflicting or adverse claims or demands are made or notices served
upon the Indemnity Escrow Agent with respect to the escrow provided for herein,
the Beneficiaries agree that the Indemnity Escrow Agent also may elect to
commence an interpleader or other action for declaratory judgment for the
purpose of having the respective rights of the claimants adjudicated, and may
deposit with the court all funds and documents held hereunder pursuant to this
Agreement; and if it so commences and deposits, the Indemnity Escrow Agent shall
be relieved and discharged from any further duties and obligations under this
Agreement. PIA Delaware shall pay all costs, expenses and attorneys' fees and
expenses incurred by the Indemnity Escrow Agent in seeking any such judgment.

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SECTION 8. Consent to Jurisdiction, Etc. Each Beneficiary hereby covenants
and agrees that the Supreme Court of the State of New York for the County of
Westchester or (in a case involving diversity of citizenship) the United States
District Court for the Southern District of New York shall have personal
jurisdiction and proper venue over any dispute with the Indemnity Escrow Agent;
provided that the foregoing consent to jurisdiction and venue by the other
parties shall not deprive the Indemnity Escrow Agent of the right in its
discretion to voluntarily commence or participate in any action, suit or
proceeding in any other court having jurisdiction and venue over the
Beneficiaries. In any dispute with the Indemnity Escrow Agent, no Beneficiary
will raise, and each Beneficiary hereby expressly waives, any objection or
defense to any such jurisdiction as an inconvenient forum. Without in any way
limiting the preceding consents to jurisdiction and venue, the parties intend
(among other things) to thereby avail themselves of the benefit of Section
5-1402 of the General Obligations Law of the State of New York. In addition to
(and without limitation of) any delivery permitted under applicable law, each
Beneficiary agrees that service of process may be made at his or its office in
Westchester County, New York.

SECTION 9. Waiver of Jury Trial. In any action or proceeding involving the
Indemnity Escrow Agent in any jurisdiction, the Parties each waive trial by
jury.

SECTION 10. Expenses of the Indemnity Escrow Agent. PIA Delaware shall pay
any and all costs and expenses incurred by the Indemnity Escrow Agent in
connection with the administration and holding of the Escrow Deposit and the
investment of any Escrow Funds, and the enforcement, protection and adjudication
of the parties' rights hereunder by the Indemnity Escrow Agent, including,
without limitation, the disbursements, expenses and fees of the Indemnity Escrow
Agent itself and those of other attorneys it may retain, if any.

SECTION 11. Reliance on Documents and Experts. The Indemnity Escrow Agent
shall be entitled to rely upon any notice, consent, certificate, affidavit,
statement, paper, document, writing or communication (which to the extent
permitted hereunder may be by telegram, cable, telex, telecopier, or telephone)
reasonably believed by it to be genuine and to have been signed, sent or made by
the proper person or persons, and upon opinions and advice of legal counsel
(including itself or counsel for any party hereto), independent public
accountants and other experts selected by the Indemnity Escrow Agent.

SECTION 12. Status of the Indemnity Escrow Agent, Etc. The Indemnity Escrow
Agent is acting under this Agreement as a stakeholder only and shall be
considered an independent contractor with respect to each Beneficiary. No term
or provision of this Agreement is intended to create, nor shall any such term or
provision be deemed to have created, any principal-agent, trust, joint venture,
partnership, debtor-creditor or attorney-client relationship between or among
the Indemnity Escrow Agent and any of the Beneficiaries. This Agreement shall
not be deemed to prohibit or in any way restrict the Indemnity Escrow Agent's
representation of any Beneficiary, who may be advised by the Indemnity Escrow
Agent on any and all matters pertaining to this Agreement and the Escrow
Deposit. To the extent one or more of the Beneficiaries have been, are and/or
will be represented by the Indemnity Escrow Agent, each such Beneficiary hereby
waives any conflict of interest and irrevocably authorizes and directs the
Indemnity Escrow Agent to carry out the terms and provisions of this Agreement,
in each case without regard to any representation of any such Beneficiary, with
deference to no party and fairly as to all parties, and irrespective of the
impact upon or any conflicting communication from any such Beneficiary. The
Indemnity Escrow Agent's only duties are those expressly set forth in this
Agreement, and each Beneficiary authorizes the Indemnity Escrow Agent to perform
those duties in accordance with its usual practices in holding funds and
documents of its own or those of other escrows. The Indemnity Escrow Agent may
exercise or otherwise enforce any of its rights, powers, privileges, remedies
and interests under this Agreement and applicable law or perform any of its
duties under this Agreement by or through its directors, officers, partners,
employees, attorneys, agents or designees.

SECTION 13. Exculpation. The Indemnity Escrow Agent and its designees, and
their respective directors, officers, partners, counsel, employees, attorneys
and agents, shall not incur any liability whatsoever for (a) the investment or
disposition of funds, the holding or delivery of documents or the taking of any
other action, in each case in accordance with the terms and provisions of this
Agreement, (b) any mistake or error in judgment, (c) compliance with any
applicable law or any attachment, order or other directive of any court or other
authority (irrespective of any conflicting term or provision of this Agreement),
or (d) any other act or omission of any other independent person engaged by the
Indemnity Escrow Agent in connection with this Agreement; and each Beneficiary
hereby waives any and all claims and actions whatsoever against the

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Indemnity Escrow Agent and its designees, and their respective directors,
officers, partners, employees, attorneys and agents, arising out of or related
directly or indirectly to any and all of the foregoing acts, omissions and
circumstances. Furthermore, the Indemnity Escrow Agent and its designees, and
their respective directors, officers, partners, employees, attorneys and agents,
shall not incur any liability (other than for a person's own acts or omissions
breaching a duty or contractual obligation owed to the claimant and amounting to
gross negligence or willful misconduct as finally determined pursuant to
applicable law by a governmental authority having jurisdiction) for other acts
and omissions arising out of or related directly or indirectly to this Agreement
or the Escrow Deposit; and each Beneficiary hereby expressly waives any and all
claims and actions (other than those attributable to a person's own acts or
omissions breaching a duty or contractual obligation owed to the claimant and
amounting to gross negligence or willful misconduct as finally determined
pursuant to applicable law by a governmental authority having jurisdiction)
against the Indemnity Escrow Agent and its designees, and their respective
directors, officers, partners, employees, attorneys and agents, arising out of
or related directly or indirectly to any and all of the foregoing acts,
omissions and circumstances.

SECTION 14. Indemnification. The Indemnity Escrow Agent and its designees,
and their respective directors, officers, partners, employees, attorneys and
agents, shall be indemnified, reimbursed, held harmless and, at the request of
the Indemnity Escrow Agent, defended by the Beneficiaries, jointly and
severally, from and against any and all claims, liabilities, losses and expenses
(including, without limitation, the disbursements, expenses and fees of their
respective attorneys) that may be imposed upon, incurred by, or asserted against
any of them, or any of their respective directors, officers, partners,
employees, attorneys or agents, arising out of or related directly or indirectly
to this Agreement or the Escrow Deposit, except such as are occasioned by the
indemnified person's own acts and omissions breaching a duty or contractual
obligation owed to the claimant and amounting to gross negligence or willful
misconduct as finally determined pursuant to applicable law by a governmental
authority having jurisdiction.

SECTION 15. Notice. Any notice, request, demand or other communication
permitted or required to be given hereunder shall be in writing, shall be signed
by the party giving it, shall be sent by one of the following means to the
addressee at the address set forth above (or at such other address as shall be
designated hereunder by notice to the other parties and persons receiving
copies, effective upon actual receipt) and shall be deemed conclusively to have
been given: (i) on the first business day following the day timely deposited
with Federal Express (or other equivalent national overnight courier) or United
States Express Mail for overnight delivery, with the cost of overnight delivery
prepaid or for the account of the sender; (ii) on the fifth business day
following the day duly sent by certified or registered United States mail,
postage prepaid and return receipt requested, or (iii) when otherwise actually
received by the addressee on a business day (or on the next business day if
received after the close of normal business hours or on any non-business day).
Any notice, request, demand or other communication instead may be sent by
telecopy, with the cost of transmission prepaid or for the account of the
sender, and shall be deemed conclusively to have been given on the first
business day following the day duly sent, provided that the giving party also
sends a copy thereof by one of the other means referenced above. Refusal to
accept delivery of any item shall be deemed to be receipt of such item by the
refusing party. Copies may be sent by regular first-class mail, postage prepaid,
to such person(s) as a party may direct from time to time by notice to the
others, but failure or delay in sending copies shall not affect the validity of
any such notice, request, demand or other communication so given to a party.

SECTION 16. Section and Other Headings. The section and other headings
contained in this Agreement are for reference purposes only and shall not affect
the meaning or interpretation of this Agreement.

SECTION 17. Governing Law. This Agreement: has been executed and delivered
in the State of New York; and shall be governed by and construed in accordance
with the applicable laws pertaining in the State of New York (other than those
that would defer to the substantive laws of another jurisdiction). Without in
any way limiting the preceding choice of law, the parties intend (among other
things) to thereby avail themselves of the benefit of Section 5-1401 of the
General Obligations Law of the State of New York.

SECTION 18. Severability. In the event that any term or provision of this
Agreement shall be finally determined to be superseded, invalid, illegal or
otherwise unenforceable pursuant to applicable law by a governmental authority
having jurisdiction and venue, that determination shall not impair or otherwise
affect the validity, legality or enforceability (a) by or before that authority
of the remaining terms and provisions of

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this Agreement, which shall be enforced as if the unenforceable term or
provision were deleted, or (b) by or before any other authority of any of the
terms and provisions of this Agreement.

SECTION 19. Counterparts. This Agreement may be executed in two or more
counterparts, each of which may be executed by one or more of the parties
hereto, but all of which, when taken together, shall constitute but one
agreement binding upon all of the parties hereto.

SECTION 20. Effective Date. This Agreement shall be effective on the date
as of which this Agreement shall be executed by all the parties hereto and
delivered to the Indemnity Escrow Agent.

SECTION 21. Successors and Assigns; Assignment. Whenever in this Agreement
reference is made to any party, such reference shall be deemed to include the
successors, assigns, heirs and legal representatives of such party, and, without
limiting the generality of the foregoing, all representations, warranties,
covenants and other agreements made by or on behalf of each Beneficiary in this
Agreement shall inure to the benefit of the successors and assigns of the
Indemnity Escrow Agent; provided, however, that nothing herein shall be deemed
to authorize or permit any Beneficiary to assign any of its rights or
obligations hereunder to any other person (whether or not an affiliate of the
Beneficiary), and each Beneficiary covenants and agrees that it shall not make
any such assignment.

SECTION 22. No Third Party Rights. The representations, warranties and
other terms and provisions of this Agreement are for the exclusive benefit of
the parties hereto, and no other person, including creditors of any Beneficiary,
shall have any right or claim against any party by reason of any of those terms
and provisions or be entitled to enforce any of those terms and provisions
against any party.

SECTION 23. No Waiver by Action, Etc. Any waiver or consent respecting any
representation, warranty, covenant or other term or provision of this Agreement
shall be effective only in the specific instance and for the specific purpose
for which given and shall not be deemed, regardless of frequency given, to be a
further or continuing waiver or consent. The failure or delay of a party at any
time or times to require performance of, or to exercise its rights with respect
to, any representation, warranty, covenant or other term or provision of this
Agreement in no manner (except as otherwise expressly provided herein) shall
affect its right at a later time to enforce any such term or provision. No
notice to or demand on any Party in any case shall entitle such party to any
other or further notice or demand in the same, similar or other circumstances.
All rights, powers, privileges, remedies and interests of the Indemnity Escrow
Agent under this Agreement are cumulative and not alternatives, and they are in
addition to and shall not limit (except as otherwise expressly provided herein)
any other right, power, privilege, remedy or interest of the Indemnity Escrow
Agent under this Agreement or applicable law.

SECTION 24. Modification, Amendment, Etc. Each and every modification and
amendment of this Agreement shall be in writing and signed by all of the parties
hereto, and each and every waiver of, or consent to any departure from, any
covenant, representation, warranty or other provision of this Agreement shall be
in writing and signed by each party affected thereby.

SECTION 25. Entire Agreement. This Agreement contains the entire agreement
of the parties and supersedes all other representations, agreements and
understandings, oral or otherwise, among the parties with respect to the matters
contained herein.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date and year first written above.

THE BENEFICIARIES:                        PIA MERCHANDISING SERVICES, INC.

By:

------------------------------------
Name:
Title:

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280

SG ACQUISITION, INC.

By:

------------------------------------
Name:
Title:

PIA MERCHANDISING CO., INC.

By:

------------------------------------
Name:
Title:

SPAR ACQUISITION, INC., a Delaware
corporation

By:

------------------------------------
Name:
Title:

SPAR MARKETING, INC., a Delaware
corporation

By:

------------------------------------
Name:
Title:

SPAR MARKETING FORCE, INC.

By:

------------------------------------
Name:
Title:

SPAR, INC.

By:

------------------------------------
Name:
Title:

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281

SPAR/BURGOYNE RETAIL SERVICES, INC.

By:

------------------------------------
Name:
Title:

SPAR MARKETING, INC., a Nevada
corporation

By:

------------------------------------
Name:
Title:

SPAR INCENTIVE MARKETING, INC.

By:

------------------------------------
Name:
Title:

SPAR MCI PERFORMANCE GROUP, INC.

By:

------------------------------------
Name:
Title:

SPAR TRADEMARKS, INC.

By:

------------------------------------
Name:
Title:

------------------------------------
ROBERT G. BROWN

------------------------------------
WILLIAM H. BARTELS

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THE INDEMNITY ESCROW AGENT:               PARKER CHAPIN FLATTAU & KLIMPL, LLP

By:

----------------------------------
ROBERT G. BROWN

------------------------------------
WILLIAM H. BARTELS

THE INDEMNITY ESCROW AGENT:               PARKER CHAPIN FLATTAU & KLIMPL, LLP

By:

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

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283

ANNEX B-1
FORM OF
AMENDMENT TO
CERTIFICATE OF INCORPORATION
OF
PIA MERCHANDISING SERVICES, INC.

FOR CHARTER AMENDMENT NO. 1

Article FOURTH of the Certificate of Incorporation of PIA Merchandising
Services, Inc. is amended to read in full as follows:

FOURTH: The total number of shares of stock which the Corporation
shall have the authority to issue is 50,000,000, consisting of 47,000,000
shares of common stock, par value $.01 per share, and 3,000,000 shares of
preferred stock, par value $.01 per share. The preferred stock may be
issued at any time, and from time to time, in one or more series pursuant
hereto or to a resolution or resolutions providing for such issue duly
adopted by the board of directors (the "Board") of the Corporation
(authority to do so being hereby expressly vested in the Board), and such
resolution or resolutions shall also set forth the voting powers, full or
limited, or none, of each such series of preferred stock and shall fix the
designations, preferences and relative, participating, optional or other
special rights and qualifications, limitations or restrictions of each such
series of preferred stock.

Annex B-1

284

ANNEX B-2
FORM OF
AMENDMENT TO
CERTIFICATE OF INCORPORATION
OF
PIA MERCHANDISING SERVICES, INC.
FOR CHARTER AMENDMENT NO. 2

Article TENTH of the Certificate of Incorporation of PIA Merchandising
Services, Inc. is hereby deleted and Article ELEVENTH is hereby renumbered as
Article TENTH.

Annex B-2

285

ANNEX B-3
FORM OF
AMENDMENT TO
CERTIFICATE OF INCORPORATION
OF
PIA MERCHANDISING SERVICES, INC.
FOR CHARTER AMENDMENT NO. 3

Article FIRST of the Certificate of Incorporation of PIA Merchandising
Services, Inc. is amended to read in full as follows:

FIRST: The name of the Corporation is SPAR Group, Inc.

Annex B-3

286

ANNEX B-4
FORM OF
AMENDMENT TO
CERTIFICATE OF INCORPORATION
OF
PIA MERCHANDISING SERVICES, INC.
FOR REVERSE SPLIT PROPOSAL

Article FOURTH of the Certificate of Incorporation of PIA Merchandising
Services, Inc. is amended to add the following paragraph at the end of Article
FOURTH:

Upon this Certificate of Amendment to the Certificate of Incorporation
of the Corporation becoming effective pursuant to the General Corporation
Law of the State of Delaware (the "Effective Time"), each share of the
Corporation's common stock, par value $.01 per share (the "Old Common
Stock"), issued and outstanding immediately prior to the Effective Time,
will be automatically reclassified as and converted into [               ]
of a share of common stock, par value $.01 per share, of the Corporation
(the "New Common Stock"). Any stock certificate that, immediately prior to
the Effective Time, represented shares of the Old Common Stock will, from
and after the Effective Time, automatically and without the necessity of
presenting the same for exchange, represent the number of shares of the New
Common Stock as equals the product obtained by multiplying the number of
shares of Old Common Stock represented by such certificate immediately
prior to the Effective Time by [               ]. No fractional shares of
New Common Stock will be issued in connection with the reclassification and
conversion of the Old Common Stock into the New Common Stock. In lieu of
any fractional shares, each holder of Old Common Stock who would otherwise
receive a fractional share of New Common Stock will be entitled to receive
cash in an amount equal to the product obtained by multiplying (1) the
closing sales price of the Corporation's Common Stock at the Effective Time
as reported on the Nasdaq National Market (or, if applicable, the Nasdaq
SmallCap Market or any exchange that the PIA Common Stock may be traded on
at the Effective Time) by (2) the number of shares of Old Common Stock held
by such holder that would otherwise have been exchanged for such fractional
share interest.

Annex B-4

287

ANNEX C

PIA MERCHANDISING SERVICES, INC.

AMENDED AND RESTATED 1995 STOCK OPTION PLAN

SECTION 1. Description of this Plan. This is the 1995 Stock Option Plan,
dated December 5, 1995, as amended and restated effective as of February 28,
1999 (this "Plan"), of PIA Merchandising Services, Inc., a Delaware corporation
(the "Company"). Under this Plan, officers, directors, key employees and
consultants of the Company or its wholly-owned Subsidiaries (as defined below),
and other persons directly or indirectly providing valuable services to the
Company and the Subsidiaries, to be selected as set forth below, may be granted
options ("Options") to purchase shares of the common stock, par value $0.01 per
share, of the Company ("Common Stock"). This Plan permits the granting of both
Options that qualify for treatment as incentive stock options ("Incentive Stock
Options") under Section 422 of the Internal Revenue Code of 1986, as amended
(the "Code"), and Options that do not qualify as Incentive Stock Options
("Nonqualified Stock Options"). For purposes of this Plan, the term "Subsidiary"
shall mean any corporation or other entity of which 50% or more of the voting
stock (or equivalent thereof) is owned by the Company or by another Subsidiary
(as so defined) of the Company.

SECTION 2. Purpose of this Plan. The purpose of this Plan and of granting
Options to specified persons is to further the growth, development and financial
success of the Company and the Subsidiaries by providing additional incentives
to certain officers, directors, key employees and consultants of, and other
persons directly or indirectly providing valuable services to, the Company and
the Subsidiaries. By assisting such persons in acquiring shares of Common Stock,
the Company can ensure that such persons will themselves benefit directly from
the Company's and the Subsidiaries' growth, development and financial success.

SECTION 3. Eligibility. The persons who shall be eligible to receive grants
of Options under this Plan shall be, at the time of the grant, the officers,
directors, key employees and consultants of, and other persons directly or
indirectly providing valuable services to, the Company and the Subsidiaries.
Notwithstanding the preceding sentence, only persons who are employees of the
Company and the Subsidiaries shall be eligible to receive grants of Incentive
Stock Options under this Plan. A person who holds an Option is herein referred
to as a "Participant." More than one Option may be granted to any Participant,
grants of Options may be made on more than one occasion to any Participant and
any individual Participant may receive grants of Options on up to 1,000,000
shares of Common Stock. Such grants of Options under this Plan may include an
Incentive Stock Option, Nonqualified Stock Option, or any combination thereof.

SECTION 4. Administration. This Plan shall be administered by the Board of
Directors (the "Board") or by the Compensation Committee established by the
Board. (The entity actually administering this Plan at any time, whether the
Board or the Compensation Committee, is referred to herein as the "Committee.")
If the Compensation Committee is authorized to administer this Plan at any time,
it shall, if possible, be composed solely of two or more Non-Employee Directors,
as such term is defined in Rule 16b-3(b)(3) under the Securities Exchange Act of
1934 (the "Exchange Act") and of persons who are "outside directors" within the
meaning of Code Section 162(m). The Committee shall meet at such times and
places as it determines and may meet through a telephone conference call. A
majority of its members shall constitute a quorum, and the decision of a
majority of those present at any meeting at which a quorum is present shall
constitute the decision of the Committee. A memorandum signed by all the members
of the Committee shall constitute the decision of the Committee without
necessity, in such event, for holding an actual meeting. The Committee is
authorized and empowered to administer this Plan and, subject to this Plan (a)
to select the Participants, to specify the number of shares of Common Stock with
respect to which Options are granted to each Participant, to specify the terms
of the Options and whether such Options shall be Incentive Stock Options or
Nonqualified Stock Options, and in general to grant Options; (b) to determine
the dates upon which Options shall be granted and the terms and conditions
thereof in a manner consistent with this Plan, which terms and conditions need
not be identical as to the various Options granted; (c) to interpret this Plan;
(d) to prescribe, amend and rescind rules relating to this Plan; (e) to
authorize any person to execute on behalf of the Company any instrument required
to effectuate the grant of an Option previously granted by the Committee; (f) to
determine the rights and obligations of Participants under this Plan; (g) to
specify the Option Price (as hereinafter defined); (h) to accelerate the time
during which an Option may be exercised, including, but not limited to, upon a
change of control of the Company, and to otherwise accelerate the time or extend
the post-
Annex C-1

288

termination exercise period during which an Option may be exercised, in each
case notwithstanding the provisions in the Option Agreement (as defined in
Section 13) stating the time during which it may be exercised; and (i) to make
all other determinations deemed necessary or advisable for the administration of
this Plan. The good faith interpretation and construction by the Committee of
any provision of this Plan or of any Option granted under it shall be final,
conclusive and binding. No member of the Committee shall be liable for any
action or determination made in good faith with respect to this Plan or any
Option granted under it.

SECTION 5. Shares Subject to this Plan. The number of shares of Common
Stock in respect of which Options may be granted under this Plan is 3,500,000,
subject to adjustment as provided in Section 12 hereof. Upon the expiration,
termination or cancellation, in whole or in part, for any reason of an
outstanding Option or any portion thereof which shall not have vested or shall
not have been exercised in full, any shares of Common Stock then remaining
unissued which shall have been reserved for issuance upon such exercise shall
again become available for the granting of additional Options under this Plan.
Notwithstanding the foregoing, shares subject to a terminated Option shall
continue to be considered to be outstanding for purposes of determining the
maximum number of shares that may be issued to a Participant. Similarly, the
repricing of an Option will be considered the grant of a new Option for this
purpose.

SECTION 6. Option Price. Except as provided in Section 12 hereof, the
purchase price per share (the "Option Price") of the shares of Common Stock
underlying each Incentive Stock Option shall be not less than the fair market
value of such shares on the date of granting of the Incentive Stock Option;
provided, however, that if the Participant is a ten percent (10%) stockholder of
the Company as detailed in Code Section 422(b)(6) at the time such Option is
granted (determined after taking into account the constructive ownership rules
of Section 424(d) of the Code), the Option Price shall be not less than 110
percent (110%) of said fair market value. The Option Price of the shares of
Common Stock underlying each Nonqualified Stock Option shall be not less than
eighty-five percent (85%) of the fair market value of such shares on the date of
granting of the Nonqualified Stock Option; provided, however, that with respect
to any Nonqualified Stock Option granted to a "covered employee" (as such term
is defined in Section 162(m) of the Code), the Option Price of the shares of
Common Stock underlying such Nonqualified Stock Option shall be not less than
the fair market value of such shares on the date of granting of such
Nonqualified Stock Option. The fair market value of such shares shall, unless
otherwise expressly determined by the Committee for good reason, shall be (i)
the last reported sale price of the Common Stock on the Nasdaq National Market,
if the Common Stock is quoted on the Nasdaq National Market, (ii) the last
reported sale price of the Common Stock on a national securities exchange, if
the Common Stock is listed on a national securities exchange, or (iii) if the
Common Stock is not so reported or listed, the average of the last reported bid
and asked price of the Common Stock in such market as the Common Stock may be
traded.

SECTION 7. Restrictions on Grants; Vesting of Options. Notwithstanding any
other provisions set forth herein or in any Option Agreement, no Options may be
granted under this Plan subsequent to December 5, 2005. All Options granted
pursuant to this Plan shall be granted pursuant to Option Agreements, as
described in Section 13 hereof. The vesting of all Options may be based on the
Company's attaining of performance criteria as specified at the time of the
granting thereof and/or may also be based on the passage of time. The Committee
shall determine the performance criteria, the performance measurement period and
the vesting schedule applicable to each Option or group of Options in a
schedule, a copy of which shall be filed with the records of the Committee and
attached to each Option Agreement to which the same applies. The performance
criteria, the performance measurement period and the vesting schedule and period
of exercisability need not be identical for all Options granted hereunder.
Following the conclusion of each applicable performance measurement period, the
Committee shall determine, in its sole good faith judgment, the extent, if at
all, that each Option subject thereto shall have vested based upon the
applicable performance criteria and vesting schedule. To the extent any Option
shall not have vested, because the applicable performance criteria has not been
met, and does not also vest based on the passage of time, it shall, to that
extent, automatically terminate and cease to be exercisable to such extent
notwithstanding the stated term during which it may be exercised. The Committee
shall promptly notify each affected Participant of such determination. The
Committee may periodically review the performance criteria applicable to any
Option or Options and, in its sole good faith judgment, may adjust the same to
reflect unanticipated major events, such as catastrophic occurrences, mergers,
acquisitions and the like.

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SECTION 8. Special Limitations on Incentive Stock Options. To the extent
that the aggregate fair market value (determined at the time the respective
Incentive Stock Option is granted) of Common Stock with respect to which
Incentive Stock Options are exercisable for the first time by a Participant
during any calendar year under all incentive stock option plans of the Company
and the Subsidiaries exceeds $100,000, or such other limit as may be required by
the Code, such excess Incentive Stock Options shall be treated as Nonqualified
Stock Options. The Committee shall determine, in accordance with applicable
provisions of the Code, Treasury Regulations and other administrative
pronouncements, which of a Participant's Incentive Stock Options will not
constitute Incentive Stock Options because of such limitation and shall notify
the Participant of such determination as soon as practicable after such
determination.

SECTION 9. Exercise of Options. Subject to all other provisions of this
Plan, once vested, each Option shall be exercisable for the full number of
shares of Common Stock subject thereto, or any part thereof, in such
installments and at such intervals as the Committee may determine in granting
such Option, provided that no option may be exercisable subsequent to its
termination date. Once vested, and prior to its termination date, an Option may
be exercised by the Participant by giving written notice to the Company
specifying the number of full shares to be purchased and accompanied by payment
of the full purchase price therefor in cash, by check or in such other form of
lawful consideration as the Committee may approve from time to time, including,
without limitation and in the sole discretion of the Committee, the assignment
and transfer by the Participant to the Company of outstanding shares of Common
Stock theretofore held by the Participant. In connection with such assignment
and transfer, the Company shall have the right to deduct any fractional share to
be paid to the Participant. Once vested, and prior to its termination date, an
Option may only be exercised by the Participant or, in the event of death of the
Participant, by the person or persons (including the deceased Participant's
estate) to whom the deceased Participant's rights under such Option shall have
passed by will or the laws of descent and distribution. Notwithstanding the
foregoing in the immediately preceding sentence, in the event of disability
(within the meaning of Section 22(e)(3) of the Code) of a Participant, a
designee, or if the Participant has no designee, the legal representative, of
such Participant may exercise the Option on behalf of such Participant (provided
such Option would have been exercisable by such Participant) until the right to
exercise such Option expires, as set forth in such Participant's particular
Option Agreement.

SECTION 10. Issuance of Common Stock. The Company's obligation to issue
shares of its Common Stock upon exercise of an Option is expressly conditioned
upon the compliance by the Company with any registration or other qualification
obligations with respect to such shares under any state or federal law or
rulings and regulations of any government regulatory body and the making of such
investment representations or other representations and undertakings by the
Participant (or the Participant's legal representative, heir or legatee, as the
case may be) in order to comply with the requirements of any exemption from any
such registration or other qualification obligations with respect to such shares
which the Company in its sole discretion shall deem necessary or advisable. Such
required representations and undertakings may include representations and
agreements that such Participant (or the Participant's legal representative,
heir or legatee): (a) is purchasing such shares for investment and not with any
present intention of selling or otherwise disposing of such shares; and (b)
agrees to have a legend placed upon the face and reverse of any certificates
evidencing such shares (or, if applicable, an appropriate data entry made in the
ownership records of the Company) setting forth (i) any representations and
undertakings which such Participant has given to the Company or a reference
thereto, and (ii) that, prior to effecting any sale or other disposition of any
such shares, the Participant must furnish to the Company an opinion of counsel,
satisfactory to the Company and its counsel, to the effect that such sale or
disposition will not violate the applicable requirements of state and federal
laws and regulatory agencies; provided, however, that any such legend or data
entry shall be removed when no longer applicable. The Company, during the term
of this Plan, will at all times reserve and keep available, and will use its
reasonable efforts to obtain from any regulatory body having jurisdiction any
requisite authority in order to issue and sell such number of shares of Common
Stock as shall be sufficient to satisfy the requirements of this Plan. The
inability of the Company to obtain, from any regulatory body having
jurisdiction, authority reasonably deemed by the Company's counsel to be
necessary for the lawful issuance and sale of any shares hereunder shall relieve
the Company of any liability in respect of the non-issuance or sale of such
shares as to which such requisite authority shall not have been obtained.

SECTION 11. Non-transferability. Except as otherwise provided below, an
Option may not be sold, pledged, assigned, hypothecated, transferred or disposed
of in any manner other than by will or by the laws of

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descent or distribution. The Committee may, in its discretion, authorize all or
a portion of any Nonqualified Stock Option granted to a Participant to be on
terms which permit transfer by such Participant to (a) the spouse, children or
grandchildren of the optionee ("Immediate Family Members"), (b) a trust or
trusts for the exclusive benefit of such Immediate Family Members, or (c) a
partnership in which such Immediate Family Members are the only partners,
provided that (i) there may be no consideration for any such transfer, and (ii)
the Option Agreement (defined below) pursuant to which such Options are granted
must be approved by the Committee, and must expressly provide for
transferability in a manner consistent with this Section 11. Following transfer,
any such Options shall continue to be subject to the same terms and conditions
as were applicable immediately prior to transfer, provided that for purposes of
Sections 9 and 10 hereof the term "Participants" shall be deemed to refer to the
transferee. The events of termination of employment of Section 25 hereof shall
continue to be applied with respect to the original Participant, following which
the Options shall be exercisable by the transferee only to the extent, and for
the periods specified in the Option Agreement. Any permitted transferee shall be
required prior to any transfer of an Option or shares of Common Stock acquired
pursuant to the exercise of an Option to execute a written undertaking to be
bound by the provisions of the applicable Option Agreement.

SECTION 12. Adjustments Upon Capitalization and Corporate Changes;
Substitute Options. Subject to Section 15(b) hereof, if the outstanding shares
of the Common Stock of the Company are changed into, or exchanged for, a
different number or kind of shares or securities of the Company through
reorganization, merger, recapitalization or reclassification, or if the number
of outstanding shares is changed through a stock split, stock dividend, stock
consolidation or like capital adjustment, or if the Company makes a distribution
in partial liquidation or any other comparable extraordinary distribution with
respect to its Common Stock, an appropriate adjustment shall be made by the
Committee in the number, kind or Option Price of shares as to which Options may
be granted. A corresponding adjustment shall likewise be made in the number,
kind or Option Price of shares with respect to which unexercised Options have
theretofore been granted. Any such adjustment in an outstanding Option, however,
shall be made without change in the total price applicable to the unexercised
portion of the Option but with a corresponding adjustment in the price for each
share covered by the Option. In making such adjustments, or in determining that
no such adjustments are necessary, the Committee may rely upon the advice of
counsel and accountants to the Company, and the good faith determination of the
Committee shall be final, conclusive and binding. No fractional shares of stock
shall be issued under this Plan on account of any such adjustment.

If the Company at any time should succeed to the business of another
corporation through a merger or consolidation, or through the acquisition of
stock or assets of such corporation or its subsidiaries, Options may be granted
under this Plan to option holders of such corporation or its subsidiaries, in
substitution for options to purchase stock of such corporation held by them at
the time of succession. The Committee, in its sole and absolute discretion,
shall determine the extent to which such substitute Options shall be granted (if
at all), the person or persons to receive such substitute Options (who need not
be all option holders of such corporation), the number of Options to be received
by each such person, the Option Price of such Option (which may be determined
without regard to Section 6 hereof) and the terms and conditions of such
substitute Options; provided, however, that the Option Price of each such
substituted Option which is an Incentive Stock Option shall be an amount such
that, in the sole and absolute judgment of the Committee (and in compliance with
Section 424(a) of the Code in the case of an Incentive Stock Option), the
economic benefit provided by such Option is not greater than the economic
benefit represented by the option in the acquired corporation as of the date of
the Company's acquisition of such corporation.

SECTION 13. Option Agreement. Each Option granted under this Plan shall be
evidenced by a written stock option agreement (an "Option Agreement") executed
by the Company and the Participant which (a) shall contain each of the
provisions and agreements herein specifically required to be contained therein,
(b) shall indicate whether such Option is to be an Incentive Stock Option or a
Nonqualified Stock Option, and if an Incentive Stock Option, shall contain terms
and conditions permitting such Option to qualify for treatment as an incentive
stock option under Section 422 of the Code, and (c) may contain such other terms
and conditions as the Committee deems desirable and which are not inconsistent
with this Plan.

SECTION 14. Rights as a Stockholder. A Participant or permitted transferee
of a Participant shall have no rights as a stockholder with respect to any
shares covered by an Option until the date of an entry evidencing such ownership
is made in the stock transfer books of the Company (the "Exercise Date"). No
adjustment
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shall be made for dividends (ordinary or extraordinary, whether in cash,
securities or other property) or distributions or other rights for which the
record date is prior to the Exercise Date.

SECTION 15. Termination of Options, Acceleration of Options.

(a) Each Option shall terminate and expire, and shall no longer be subject
to exercise, as the Committee may determine in granting such Option, and each
Option granted under this Plan shall set forth a termination date thereof,
which, subject to earlier termination as set forth in Section 7 hereof or this
Section 15, or as otherwise set forth in any particular Option Agreement, with
respect to Nonqualified Stock Options, shall be no later than ten years from the
date such Option is granted, and with respect to Incentive Stock Options, shall
also be no later than ten years from the date such Option is granted unless the
Participant is a ten percent (10%) stockholder of the Company (as described in
Section 422(b)(6) of the Code, and determined after taking into account the
constructive ownership rules of Section 424(d) of the Code) at the time such
Option is granted, in which case the Option shall terminate and expire no later
than five years from the date of the grant thereof. An Incentive Stock Option
shall contain any additional termination events required by Section 422 of the
Code.

(b) Subject to Section 15(c) hereof, unless the Committee shall, in its
sole discretion, determine otherwise, upon (i) the dissolution, liquidation or
sale of all or substantially all of the business, properties and assets of the
Company, (ii) upon any reorganization, merger or consolidation in which the
Company does not survive, (iii) upon any reorganization, merger, consolidation
or exchange of securities in which the Company does survive and any of the
Company's stockholders have the opportunity to receive cash, securities of
another corporation and/or other property in exchange for their capital stock of
the Company, or (iv) upon any acquisition by any person or group (as defined in
Section 13(d) of the Securities Act of 1934) of beneficial ownership of more
than fifty percent (50%) of the Company's then outstanding shares of Common
Stock (each of the events described in clauses (i), (ii), (iii) or (iv) is
referred to herein individually as an "Extraordinary Event"), this Plan and each
outstanding Option shall terminate. In such event each Participant shall have
the right until 10 days before the effective date of the Extraordinary Event to
exercise, in whole or in part, any unexpired Option or Options issued to the
Participant, to the extent that said Option is then vested and exercisable
pursuant to the provisions of said Option or Options and of Section 7 hereof.
The termination of employment of, or the termination of a consulting or other
relationship with, a Participant for any reason shall not accelerate or
otherwise affect the number of shares with respect to which an Option may be
exercised;

provided, however, that the Option may only be exercised with respect to that
number of shares which could have been purchased under the Option had the Option
been exercised by the Participant on the date of such termination.

(c) Notwithstanding the provisions of Section 7 or paragraphs (a) or (b) of
this Section 15, or any provision to the contrary contained in a particular
Option Agreement, the Committee, in its sole discretion, at any time, or from
time to time, may elect to accelerate the vesting of all or any portion of any
Option then outstanding. The decision by the Committee to accelerate an Option
or to decline to accelerate an Option shall be final, conclusive and binding. In
the event of the acceleration of the exercisability of Options as the result of
a decision by the Committee pursuant to this Section 15(c), each outstanding
Option so accelerated shall be exercisable for a period from and after the date
of such acceleration and upon such other terms and conditions as the Committee
may determine in its sole discretion; provided, however, that such terms and
conditions (other than terms and conditions relating solely to the acceleration
of exercisability and the related termination of an Option) may not adversely
affect the rights of any Participant without the consent of the Participant so
adversely affected. Any outstanding Option which has not been exercised by the
holder at the end of such stated period shall terminate automatically and become
null and void.

SECTION 16. Withholding of Taxes. The Company, or a Subsidiary, as the case
may be, may deduct and withhold from the wages, salary, bonus and other income
paid by the Company or such Subsidiary to the Participant the requisite tax upon
the amount of taxable income, if any, recognized by the Participant in
connection with the exercise in whole or in part of any Option, or the sale of
Common Stock issued to the Participant upon the exercise of an Option, as may be
required from time to time under any federal or state tax laws and regulations.
This withholding of tax shall be made from the Company's (or such Subsidiaries')
concurrent or next payment of wages, salary, bonus or other income to the
Participant or by payment to the
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Company (or such Subsidiaries) by the Participant of the required withholding
tax, as the Committee may determine. The Company may permit the Participant to
elect to surrender, or authorize the Company to withhold, shares of Common Stock
(valued at their fair market value on the date of surrender or withholding of
such shares) in satisfaction of the Company's withholding obligation, however,
no fractional shares of Common Stock shall be delivered, nor shall any cash in
lieu of fractional shares be paid, by the Company. The Company shall have the
right to deduct fractional shares to be paid to the Participant as a result of
such surrender or withholding of shares.

SECTION 17. Effectiveness and Termination of this Plan. This Plan became
effective on the date on which it was adopted by the Board and was approved by
approved by the stockholders of the Company within 12 months of December 5,
1995. This Plan shall terminate at the earliest of the time when all shares of
Common Stock which may be issued hereunder have been so issued, or at such time
as set forth in Section 15(b) hereof; provided, however, that the Board may in
its sole discretion terminate this Plan at any other time. Unless earlier
terminated by the Board, this Plan shall terminate on December 5, 2005. Subject
to Section 15(b) hereof, no such termination shall in any way affect any Option
then outstanding.

SECTION 18. Time of Granting Options. The date of grant of an Option shall,
for all purposes, be the date on which the Committee makes the determination
granting such Option. Notice of the determination shall be given to each
Participant to whom an Option is so granted within a reasonable time after the
date of such grant.

SECTION 19. Amendment of this Plan. The Board may (a) make such changes in
the terms and conditions of granted Options as it deems advisable, provided each
Participant adversely affected by such change consents thereto, and (b) make
such amendments to this Plan as it deems advisable. Such amendments and changes
shall include, but not be limited to, acceleration of the time at which an
Option may be exercised. The Board may obtain stockholder approval of any
amendment to this Plan for any reason (including in order to take advantage of
certain exemptions under Code Section 162(m) or Code Section 422), but shall not
be required to do so unless required by law or by the rules of the Nasdaq
National Market or any stock exchange on which the Common Stock may then be
listed.

SECTION 20. Transfers and Leaves of Absence. For purposes of this Plan, (a)
a transfer of a Participant's employment or consulting relationship, without an
intervening period, between the Company and a Subsidiary shall not be deemed a
termination of employment or a termination of a consulting relationship, and (b)
a Participant who is granted in writing a leave of absence shall be deemed to
have remained in the employ of, or in a consulting relationship with, the
Company (or a Subsidiary, whichever is applicable) during such leave of absence.
Notwithstanding the foregoing, for purposes of determining the exercisability of
an Incentive Stock Option, a Participant who is on a leave of absence that
exceeds 90 days will be considered to have terminated his or her employment on
the 91st day of the leave of absence, unless the Participant's rights to
reemployment are guaranteed by statute or contract.

SECTION 21. No Obligation to Exercise Option. The granting of an Option
shall impose no obligation on the Participant to exercise such Option.

SECTION 22. Governing Law. This Plan and any Option granted pursuant to
this Plan shall be construed under and governed by the laws of the State of
Delaware without regard to conflict of law provisions thereof.

SECTION 23. Not an Employment or Other Agreement. Nothing contained in this
Plan or in any Option Agreement shall confer, intend to confer or imply any
rights of employment or any rights to any other relationship or rights to
continued employment by, or rights to a continued consulting relationship with,
the Company or any Subsidiaries in favor of any Participant or limit the ability
of the Company or any Subsidiaries to terminate, with or without cause, in its
sole and absolute discretion, the employment of, or relationship with, any
Participant, subject to the terms of any written employment or other agreement
to which a Participant is a party.

SECTION 24. Termination of Employment. The terms and conditions under which
an Option may be exercised after a Participant's termination of employment shall
be determined by the Committee and shall be specified in the Option Agreement.
The conditions under which such post-termination exercises shall be

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permitted with respect to Incentive Stock Options shall be determined in
accordance with the provisions of Section 422 of the Code.

SECTION 25. Indemnification. In addition to such other rights of
indemnification as they may have as directors, the members of the Committee
shall be indemnified by the Company to the fullest extent permitted by law
against the reasonable expenses, including reasonable attorneys' fees, actually
and necessarily incurred in connection with the defense of any action, suit or
proceeding, or in connection with any appeal therein, to which they or any of
them may be a party by reason of any action taken or failure to act under or in
connection with this Plan or any Option granted thereunder, and against all
amounts paid by them in satisfaction of a judgment in any such action, suit or
proceeding, except in relation to matters as to which it shall be adjudged in
such action, suit or proceeding that such Committee member is not entitled to
indemnification under applicable law; provided that within 60 days after
institution of any such action, suit or proceeding such Committee member shall
in writing offer the Company the opportunity, at the Company's expense, to
handle and defend the same.

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ANNEX D

OPINION OF ING BARING FURMAN SELZ LLC

[LETTERHEAD OF ING BARING FURMAN SELZ LLC]

February 28, 1999

The Board of Directors
PIA Merchandising Services, Inc.
19900 MacArthur Boulevard
Suite 900
Irvine, CA 92612

Gentlemen:

We understand that PIA Merchandising Services, Inc. (the "Company") and
SPAR Acquisition, Inc. ("SPAR") propose to enter into an agreement and plan of
merger (the "Agreement"), pursuant to which a wholly-owned subsidiary of the
Company will be merged with and into SPAR (the "Merger") in a transaction in
which each outstanding share and each outstanding option to purchase each such
share of common stock of SPAR, $.01 par value ("SPAR Common Stock"), will be
converted into the right to receive one share (the "Exchange Ratio") of common
stock of the Company, $.01 par value (the "Company Common Stock"), for an
aggregate of approximately 12.3 million shares of Company Common Stock or
approximately 2.25 times the number of shares of Company Common Stock currently
outstanding, based on the approximately 12.3 million outstanding shares and
options to purchase shares of SPAR Common Stock that you have advised us will be
outstanding immediately prior to the Merger, but excluding options to purchase
shares of Company Common Stock currently outstanding or to be granted upon the
closing of the Merger. Based on the foregoing, the former holders of SPAR Common
Stock and options to purchase such Common Stock will hold, or have the right to
acquire, approximately 69.3% of the outstanding shares of Company Common Stock
upon completion of the Merger. The Merger is subject to, among other things, the
approval of certain matters by the holders of a majority of the outstanding
shares of Company Common Stock and SPAR Common Stock voting at a special meeting
of stockholders to be called for such purpose. The terms and conditions of the
Merger will be set forth in more detail in the Agreement.

You have asked us whether, in our opinion, the Exchange Ratio is fair from
a financial point view to the stockholders of the Company.

In conducting our analysis and arriving at our opinion as described herein,
we have reviewed and analyzed, among other things, the following:

(i)   a draft of the Agreement as of February 27, 1999 by and between the
Company and SPAR;

(ii)  drafts of the other Merger Documents as defined in the Agreement, as
of February 27, 1999;

(iii)  SPAR's audited financial statements for the two fiscal years ended
March 31, 1998 and unaudited financial information for the nine
months ended December 31, 1998;

(iv)  the Asset Purchase Agreement (the "MCI Agreement") by and between MCI
Performance Group, Inc. ("MCI"), SPAR MCI Performance Group, Inc. and
John H. Wile dated December 22, 1998, as amended by a First Amendment
dated January 15, 1999;

(v)   MCI's audited financial statements for the two fiscal years ended
December 31, 1997 and unaudited financial statements for the fiscal
year ended December 31, 1998;

(vi)  the Company's Forms 10-K and related financial information for the
two fiscal years ended December 31, 1997; the Company's Form 10-Q and
related unaudited financial statements for the nine months ended
October 2, 1998; and unaudited financial information for the fiscal
year ended December 31, 1998;

(vii)  certain information, including financial forecasts, relating to the
business, earnings, cash flow, assets, liabilities and prospects of
SPAR and the Company, as well as related cost savings and

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295

expenses expected to result from the Merger furnished to us by SPAR
and the Company, respectively;

(viii) conducted discussions with members of senior management and
representatives of SPAR and the Company concerning their respective
businesses and prospects before and after giving effect to the
Merger;

(ix)  the historical and projected results of SPAR and the Company with
those of certain companies that we deemed relevant;

(x)  the proposed financial terms of the Merger and compared them to the
financial terms, to the extent publicly available, of certain other
transactions which we deemed to be relevant; and

(xi)  such other financial studies and analyses and took into account such
other matters as we deemed necessary, including our assessment of
general economic, market and monetary conditions.

In arriving at our opinion, we have assumed and relied on the accuracy and
completeness of all information supplied or otherwise made available to us or
publicly available. With respect to the financial forecast information furnished
to or discussed with us by SPAR and the Company, we have assumed that such
information has been reasonably prepared and reflects the best currently
available estimates and judgment of SPAR's or the Company's management as to the
expected future financial performance of SPAR or the Company, as the case may
be. We have assumed that the reserves established on the books and records of
each of the Company and SPAR are adequate to cover any threatened or pending
litigation. We also have assumed that the deferred payments due pursuant to the
MCI Agreement will be paid in cash. We have not assumed any responsibility for
independently verifying such information or undertaken an independent evaluation
or appraisal of any of the assets or liabilities of SPAR or the Company or been
furnished with any such evaluation or appraisal. In addition, we have not
conducted any physical inspection of the properties or facilities of SPAR or the
Company. We have assumed that the Merger will be consummated on the terms
substantially similar to those set forth in the draft of the Agreement as of
February 27, 1999, and that no adjustment with respect to the net worth of SPAR
will be made, as the amount of such adjustment, if any, is not presently
determinable.

Our opinion is necessarily based upon market, economic and other conditions
as they exist and can be evaluated on the date hereof. It should be understood
that subsequent developments may affect this opinion and that we do not have any
obligation to update, revise or reaffirm this opinion.

We do not express any view as to what the value of the Company Common Stock
will be upon completion of the Merger, or the price at which the Company Common
Stock will trade prior to or subsequent to the closing of the Merger.

We are acting as financial advisor to the Company in connection with the
Merger and will receive a fee from the Company for our services. In addition,
the Company has agreed to indemnify us for certain liabilities arising out of
our engagement. We have also performed various investment banking services for
the Company in the past five years and have received customary fees for such
services. In the ordinary course of our business, we may actively trade in the
equity securities of the Company for our own account and for the accounts of
customers and, accordingly, may at any time hold a long or short position in
such securities.

This opinion is for the use and benefit of the Board of Directors of the
Company. Our opinion does not address the merits of the underlying decision by
the Company to engage in the Merger, and does not constitute a recommendation to
any stockholder as to how such stockholder should vote on the proposed Merger.
This opinion may not be disclosed, referred to, or communicated (in whole or in
part) to any third party for any purpose whatsoever except with our prior
written consent in each instance.

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Based upon and subject to the foregoing, we are of the opinion that, as of
the date hereof, the Exchange Ratio is fair from a financial point of view to
the stockholders of the Company.

Very truly yours,

/s/ ING Baring Furman Selz LLC
ING Baring Furman Selz LLC

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ANNEX E

GLOSSARY

The following glossary includes definitions of certain general industry
terms as well as terms relating specifically to PIA and SPAR.

AD SPECIALTY -- The use of products as promotional items that are given
away for free to stimulate corporate remembrance, which products are usually
imprinted with the Company's name, address and phone number.

CATEGORY -- A segment or sub-segment of a department within a retail
outlet. For example, the health and beauty care department consists of several
categories such as oral care and shampoo; and the shampoo section is divided
into sub-categories such as salon formulas and dandruff control.

CATEGORY RESETS -- Removing existing related products from the shelf and
replacing them with the same or other products in a different placement.

DATA COLLECTION -- The systematic gathering of information for analysis and
interpretation.

DATABASE MANAGEMENT -- The management of proprietary information in a way
that permits easy access, analysis and manipulation.

DATABASE MARKETING -- Direct-response marketing that utilizes a list or
lists developed by a marketer with proprietary data.

DEMONSTRATION -- Live exhibitions, typically in-store, of how a product
works.

DIRECT MARKETING -- Marketing directly to consumers by mail catalog or
other home delivery, or attempting to solicit orders by mail or toll-free
telephone.

DIRECT PREMIUM OFFERS -- The use of travel or merchandise awards in
conjunction with the purchase of a product or service (e.g. offering a free
putter with five car rentals).

IN-STORE INTELLIGENCE -- Gathering information on store conditions, such as
out-of-stocks, products on display, pricing and number of product facings.

MASS MERCHANDISER -- The segment of retailers that offers multi-departments
in a single location, each of which is typically quite large (at least 75,000
square feet). Examples include Kmart and Wal*Mart.

MERCHANDISE FULFILLMENT -- The segment of the premium incentive sector
concerned with providing merchandise as rewards in incentive programs.

MERCHANDISING -- Service to enhance sales by making a client's products
more visible and available to consumers.

MYSTERY SHOPPING -- Anonymous calls in retail outlets by marketer's
representatives to check distribution or display of a brand and to evaluate
products, services, clients or employees.

POINT-OF-PURCHASE DISPLAY -- Displays located strategically throughout
retail stores to attract consumer attention to the product, to convey product
benefits and to promote product sales.

PREMIUM INCENTIVE -- Performance determined awards to motivate employees,
salespeople, dealers and consumers, as well as to differentiate a product,
service or store.

RE-MERCHANDISING -- A retail unit that is enhanced by the relocation of
sections, aisles and/or departments, and usually involves the total store.

REMODEL -- A retail unit that is enhanced by enlargement and/or redesign.
Structural changes most often result in departments and/or services being added
or deleted, which requires the relocation of most products and sections within
the store.

RESET -- Relocation of products within a given category or section of a
retail store. A reset typically involves removal of all products from the
retailer's shelves, restocking of products and reallocation of space.

RETAILER -- An operator of retail stores or groups of retail stores that
are also referred to as chains.
Annex E-1

298

RETAIL MERCHANDISING -- The process of utilizing outsourced personnel to
provide added value sales-enhancing services to retailers, manufacturers and
other businesses. This includes, but is not limited to, product and display
placement, category resets and product replenishment/ordering.

SAMPLING -- Providing free product by mail or in person to consumers to
create awareness and entice the use or consumption of the product.

SCHEMATIC -- A diagram that lists the specific location and shelf space to
be allocated for all items within a section. The schematic also contains data
relating to merchandising such as width, depth of shelving, shelf elevations and
height of gondola.

SELF-LIQUIDATING PREMIUM -- The use of travel or merchandise premiums with
consumers at a price which totally covers the marketer's cost of buying and
fulfilling the order.

SHARED SERVICES -- A group of associates who perform specific functions for
multiple clients on each store visit.

SWEEPSTAKES -- A promotion which requires only chance to win, and no
purchase or skill.

TELESERVICES -- The use of telecommunications and telemarketers for
gathering and soliciting information.

TEST MARKETING -- Testing promotion alternatives, new products and
advertising campaigns, as well as packaging, pricing and location changes at
store level.

TRAVEL FULFILLMENT -- The segment of the premium incentive sector concerned
with providing travel as rewards in incentive programs.

Annex E-2

299

Annex F

[FORM OF PROXY]
PROXY
PIA MERCHANDISING SERVICES, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned appoints Terry R. Peets and Cathy L. Wood, and each of them,
proxies with full power of substitution, to vote all shares of Common Stock of
PIA Merchandising Services, Inc. ("PIA") held of record by the undersigned as of
June 7, 1999, the record date with respect to this solicitation, at the Annual
Meeting of Stockholders of PIA to be held at PIA Merchandising Services, Inc.,
beginning at 9:00 a.m., Pacific Time, on Thursday, July 8, 1999, and at any
adjournments thereof, upon the following matters:

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE FOLLOWING PROPOSALS:

1. Approval of the issuance of shares (estimated to be approximately 12.7
million shares) of PIA's common stock (the "Merger Shares") to the
stockholders of SPAR Acquisition, Inc. ("SAI") and options ("Substitute
Options") to purchase an aggregate of 134,114 shares of PIA common stock to
the holders of SAI options as consideration for the merger in accordance with
the terms of that certain Agreement and Plan of Merger dated as of February
28, 1999, as amended (the "Merger Agreement") among PIA, PIA Merchandising
Co., Inc., a California corporation, SG Acquisition, Inc., a Nevada
corporation ("PIA Acquisition"), SAI, SPAR MCI Performance Group, Inc., a
Delaware corporation, SPAR Incentive Marketing, Inc., a Delaware corporation,
SPAR Marketing Force, Inc., a Nevada corporation, SPAR Marketing, Inc., a
Delaware corporation, SPAR, Inc., a Nevada corporation, SPAR/Burgoyne Retail
Services, Inc., an Ohio corporation, SPAR Marketing, Inc., a Nevada
corporation, and SPAR Trademarks, Inc., a Nevada corporation pursuant to
which, among other things, PIA Acquisition will be merged with and into SAI
(the "Merger"). The issuance of the Merger Shares and the Substitute Options
pursuant to the terms of the Merger Agreement is referred to as the
"Share/Option Issuance."

[ ] FOR             [ ] AGAINST             [ ] ABSTAIN

2. Approval of an amendment to PIA's Certificate of Incorporation to increase
the number of authorized shares of PIA Common Stock from 15 million to 47
million ("Charter Amendment No. 1").

[ ] FOR             [ ] AGAINST             [ ] ABSTAIN

3. Approval of an amendment to PIA's Certificate of Incorporation to delete the
prohibition on stockholder action by written consent without a meeting under
Delaware law ("Charter Amendment No. 2").

[ ] FOR             [ ] AGAINST             [ ] ABSTAIN

4. Approval of an amendment to PIA's Certificate of Incorporation to change the
name of PIA Merchandising Services, Inc. to "SPAR Group, Inc." ("Charter
Amendment No. 3").

[ ] FOR             [ ] AGAINST             [ ] ABSTAIN

5. Authorize an amendment, if deemed necessary by the PIA Board of Directors in
its sole discretion, to PIA's Certificate of Incorporation to effect a
reverse stock split of the issued and outstanding shares of PIA Common Stock,
on the basis of one of the following ratios: one new share in exchange for
every two issued and outstanding shares, one new share in exchange for every
three issued and outstanding shares or one new share in exchange for every
four issued and outstanding shares, with the PIA Board of Directors having
the discretion to determine the appropriate ratio to use immediately prior to
effecting the reverse stock split (the "Reverse Split Proposal").

[ ] FOR             [ ] AGAINST             [ ] ABSTAIN

APPROVAL OF THE SHARE/OPTION ISSUANCE, CHARTER AMENDMENT NO. 1, CHARTER
AMENDMENT NO. 2, CHARTER AMENDMENT NO. 3, THE REVERSE SPLIT PROPOSAL AND THE
OPTION PLAN AMENDMENT (COLLECTIVELY, THE "MERGER PROPOSALS") IS REQUIRED FOR THE
MERGER TO BE CONSUMMATED. IF ANY OF THE FOREGOING SIX MERGER PROPOSALS IS NOT
APPROVED, EVEN IF ANY OF THE OTHER FIVE PROPOSALS IS APPROVED, THE MERGER CANNOT
BE CONSUMMATED AND NONE OF THE SIX PROPOSALS WILL BE APPROVED.

CONTINUED AND TO BE SIGNED ON OTHER SIDE

Annex F-1

300

CONTINUED FROM OTHER SIDE

6. Approval of an amendment (the "Option Plan Amendment") to PIA's Amended and
Restated 1995 Stock Option Plan to increase the number of shares of common
stock of PIA reserved for issuance upon exercise of stock options granted
thereunder from 1.3 million shares to 3.5 million shares, as described in the
Proxy Statement.

[ ] FOR             [ ] AGAINST             [ ] ABSTAIN

7. ELECTION OF DIRECTORS

[ ]FOR all nominees listed below         [ ]WITHHOLD AUTHORITY
(except as noted below)                to vote for all nominees listed below

(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY NOMINEE, LINE THROUGH OR
OTHERWISE STRIKE OUT THE NOMINEE'S NAME BELOW.)

Clinton E. Owens    Patrick C. Haden    Joseph H. Coulombe    J. Christopher
Lewis
Terry R. Peets    John A. Colwell    Patrick W. Collins

8. OTHER MATTERS

IN THEIR DISCRETION, TERRY R. PEETS AND CATHY L. WOOD ARE AUTHORIZED TO VOTE
UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED BY
THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED
FOR PROPOSALS 1, 2, 3, 4, 5 AND 6 ABOVE AND FOR THE NOMINEES NAMED IN PROPOSAL
7. IF ANY DIRECTOR DECLINES OR IS UNABLE TO SERVE AS A DIRECTOR THEN THE PERSONS
NAMED AS PROXIES SHALL HAVE FULL DISCRETION TO VOTE FOR ANY OTHER PERSON
DESIGNATED BY THE BOARD OF DIRECTORS.

Dated , 1999

----------------------------
(Signature)

----------------------------
(Signature)

Please sign exactly as your
name appears hereon. Joint
owners should each sign.
When signing as an attorney,
executor, administrator,
trustee, guardian or
corporate officer, please
give full title as such.

The signer hereby revokes
all proxies heretofore given
by the signor to vote at
said meeting or any

adjournments thereof.

Annex F-2