INDEMNITY ESCROW AGREEMENT
Introduction
This Indemnity Escrow Agreement, dated as of July 8, 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/XXXXXXXX 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 XXXXXX X. XXXXX and XXXXXXX X. XXXXXXX
(each a "SPAR Principal,"and collectively the "SPAR Principals"), and XXXXXX
XXXXXX FLATTAU & KLIMPL, LLP, a New York limited liability partnership having an
address at 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, 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) 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 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 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
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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 substitution; (ii) on or before the proposed substitution
date, the SPAR Principals shall deliver $5.00 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.
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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.
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)
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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 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.
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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 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
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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.
[END OF PAGE]
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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: /s/ Xxxxx X. Xxxx
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Name: Xxxxx X. Xxxx
Title: Secretary
SG ACQUISITION, INC.
By: /s/ Xxxxx X. Xxxx
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Name: Xxxxx X. Xxxx
Title: Secretary
PIA MERCHANDISING CO., INC.
By: /s/ Xxxxx X. Xxxx
----------------------------------
Name: Xxxxx X. Xxxx
Title: Secretary
SPAR ACQUISITION, INC.
By: /s/ Xxxxxx X. Xxxxx
----------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Executive Officer
SPAR MARKETING, INC., a Delaware
corporation
By: /s/ Xxxxxx X. Xxxxx
-------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Executive Officer
SPAR MARKETING FORCE, INC.
By: /s/ Xxxxxx X. Xxxxx
--------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Executive Officer
SPAR, INC.
By: /s/ Xxxxxx X. Xxxxx
----------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Executive Officer
-8-
SPAR/XXXXXXXX RETAIL SERVICES, INC.
By: /s/ Xxxxxx X. Xxxxx
--------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Executive Officer
SPAR MARKETING, INC., a Nevada
corporation
By: /s/ Xxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Executive Officer
SPAR INCENTIVE MARKETING, INC.
By: /s/ Xxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Executive Officer
SPAR MCI PERFORMANCE GROUP, INC.
By: /s/ Xxxxxx X. Xxxxx
------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Executive Officer
SPAR TRADEMARKS, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Executive Officer
/s/ Xxxxxx X. Xxxxx
---------------------------------
XXXXXX X. XXXXX
/s/ Xxxxxxx X. Xxxxxxx
---------------------------------
XXXXXXX X. XXXXXXX
THE INDEMNITY ESCROW AGENT: XXXXXX XXXXXX FLATTAU & KLIMPL, LLP
By: /s/ Xxxxxxxx Xxxxx Xxxxx
----------------------------------
Xxxxxxxx Xxxxx Xxxxx, Partner
-9-
