11.

Purchase of Interests in Subsidiaries

Resource Plus Acquisition

January 9, 2018,

the Company completed its acquisition of a

51%

interest (the "Acquisition") in Resource Plus, Inc. ("RPI"), a supplier of professional fixture installation and product merchandising services; and a

51%

interest in both of its sister companies, Mobex of North Florida, Inc. ("Mobex"), a proprietary retail fixture mobilization system manufacturer, and Leasex, LLC ("Leasex"), a company formed to lease Mobex's proprietary equipment. RPI owns a

70%

interest in BDA Resource, LLC, a Florida limited liability company ("BDA"), and RPI, Leasex, Mobex and BDA

may

be referred to individually and collectively as "Resource Plus".

SGRP's subsidiary, SPAR Marketing Force, Inc. ("SMF"), purchased those equity interests in Resource Plus from Joseph L. Paulk and Richard Justus pursuant to separate Stock Purchase Agreements each dated as of

October 13, 2017 (

each a "SPA"), which were subject to due diligence and completion of definitive documents. The base purchase prices under the SPAs for those Resource Plus equity interests were

$3,000,000

for Mr. Paulk and

$150,000

for Mr. Justus, subject to adjustment and potential bonuses as provided in their respective SPAs. At the closing on

January 9, 2018,

Mr. Paulk received the base purchase price in

$400,000

cash and a Promissory Note for

$2,600,000;

and Mr. Justus received the base purchase price in

$50,000

cash and a Promissory Note for

$100,000.

Those notes were issued by SMF, guaranteed by SGRP pursuant to separate Guaranties, and secured by SMF pursuant to separate Securities Pledge and Escrow Agreements to the sellers of the respective acquired equity interests, with each of those documents dated and effective as of

January 1, 2018.

Mr. Paulk's note is repayable in installments of

$300,000,

plus applicable interest, per year on

December 31

of each year (commencing in

2018

), with the balance due on

December 31, 2023;

and Mr. Justus's note on

December 31

of each such year (commencing in

2018

) is repayable in installments of

$33,333

per year, plus applicable interest, on

December 31

of each year, with the balance of

$33,334

due on

December 31, 2020.

In connection with that closing, Mr. Paulk retired, while Mr. Justus continued as President of Resource Plus and received an Executive Officer Employment Terms and Severance Agreement with RPI ("ETSA"), with a base salary of

$200,000

per year (plus an incentive bonus), and a term of office and severance protection through

January 1, 2020,

subject to annual extensions in the discretion of the parties.

This acquisition was accounted for using the purchase method of accounting with the purchase price allocated to the assets purchased and liabilities assumed based upon their estimated fair values at the date of acquisition.

A summary of preliminary purchase price consideration to be allocated by SGRP in the acquisition of RPI is provided below:

Cash consideration	$	456
Notes payable		2,300
Total consideration paid	$	2,756

The preliminary estimated assets acquired and liabilities assumed by SGRP are provided below:

Cash and cash equivalents	$	1,223
Accounts receivable		2,699
Accounts payable		(255	)
Property and equipment		155
Prepaid assets		86
Marketable securities		20
Other assets		50
Accrued expenses		(1,389	)
Deferred tax liability		(572	)
Revolving line of credit		(865	)
Other intangible assets		2,290
Residual goodwill		1,962
Estimated fair value of assets acquired		5,404
Non-controlling interest		(2,648	)
Consideration paid for acquisition	$	2,756

The following table contains unaudited pro forma revenue and net income for SPAR Group, Inc. assuming SPAR Resource Plus closed on

January 1, 2017 (

in thousands):

		Revenue				Net Income
Consolidated supplemental pro forma for the nine month period ended September 30, 2017		$	147,484			$	3,261

The pro forma in the table above includes adjustments for, amortization of intangible assets and acquisition costs to reflect results that are more representative of the results of the transactions as if the Resource Plus acquisition closed on

January 1, 2017.

This pro forma information utilizes certain estimates, is presented for illustrative purposes only and

may

not

be indicative of the results of operation that would have actually occurred. In addition, future results

may

vary significantly from the results reflected in the pro forma information. The unaudited pro forma financial information does

not

reflect the impact of future events that

may

occur after the acquisition, such as anticipated cost savings from operating synergies. For the

nine

month period ended

September 30, 2018,

Resource Plus contributed

$19.9

million to the Company’s total revenue and increased net income for the same period by

$1.7

million.