Critical Accounting Policies and Estimates

The Company’s consolidated financial statements are based on the application of U.S. generally accepted accounting principles (“GAAP”). GAAP requires the use of estimates, assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenue and expense amounts reported. The Company believes its use of estimates and underlying accounting assumptions adhere to GAAP and are consistently applied. Valuations based on estimates are reviewed for reasonableness and adequacy on a consistent basis throughout the Company. Primary areas where financial information of the Company is subject to the use of estimates, assumptions and the application of judgment include revenue recognition, accounts receivable, inventories, accounting for business combinations, contingent consideration, goodwill and intangible assets, and taxes.

Revenue Recognition Policy

Hospitality Contracts

Our hospitality segment’s revenues consist of sales of the Company’s standard POS system to the hospitality segment. We derive revenue from the following sources: (1) hardware sales, (2) software license agreements, including perpetual licenses and software as a service, (3) professional services, (4) hosting services and (5) post-contract customer support ("PCS").

We recognize revenue when all four revenue recognition criteria have been met: persuasive evidence of an arrangement exists, we have delivered the product or performed the service, the fee is fixed or determinable and collection is probable. Determining whether and when some of these criteria have been satisfied often involves assumptions and judgments that can have a significant impact on the timing and amount of revenue we report.

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Hardware

Revenue recognition on hardware sales occurs upon delivery to the customer site (or when shipped for systems that are not installed by the Company) when persuasive evidence of an arrangement exists, the price is fixed or determinable, and collectability is reasonably assured.

Software

Revenue recognition on software sales generally occurs upon delivery to the customer, when persuasive evidence of an arrangement exists, the price is fixed or determinable, and collectability is probable. For software sales sold as a perpetual license, typical our Pixel software offering, where the Company is the sole party that has the proprietary knowledge to install the software, revenue is recognized upon installation and when the system is ready to go live.

Service

Service revenue consists of installation and training services, field and depot repair, subscription software products, associated software maintenance, and software related hosted services. Installation and training service revenue are based upon standard hourly/daily rates as well as contracted prices with the customer, and revenue is recognized as the services are performed. Support maintenance and field and depot repair are provided to customers either on a time and materials basis or under a maintenance contract. Services provided on a time and materials basis are recognized as the services are performed. Service revenues from maintenance contracts are recorded as deferred revenue when billed to the customer and are recognized ratably over the underlying contract period. Software sold as a service with our Brink and SureCheck software offerings, is recognized based on the contracted price over its contract term.

PAR frequently enters into multiple-element arrangements with its customers including hardware, software, professional consulting services and maintenance support services. For arrangements involving multiple deliverables, when deliverables include software and non-software products and services, PAR evaluates and separates each deliverable to determine whether it represents a separate unit of accounting based on the following criteria: (a) the delivered item has value to the customer on a stand-alone basis; and (b) if the contract includes a general right of return relative to the delivered item, delivery or performance of the undelivered items is considered probable and substantially in the control of PAR.

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Multiple element arrangements which include hardware, service, and software offerings are separated based upon the stand alone price for each individual hardware, service, or software sold in the arrangement irrespective of the combination of products and services which are included in a particular arrangement. As such, overall consideration is allocated to each unit of accounting based on the unit's relative selling prices. In such circumstances, the Company uses a hierarchy to determine the selling price to be used for allocating revenue to each deliverable: (i) vendor-specific objective evidence of selling price (VSOE), (ii) third-party evidence of selling price (TPE), and (iii) best estimate of selling price (BESP). VSOE generally exists only when the Company sells the deliverable separately and is the price actually charged by the Company for that deliverable. The Company uses BESP to allocate revenue when we are unable to establish VSOE or TPE of selling price. BESP is primarily used for elements such as products that are not consistently priced within a narrow range. The Company determines BESP for a deliverable by considering multiple factors including product and customer class, geography, average discount, and management's historical pricing practices. Amounts allocated to the delivered hardware and software elements are recognized at the time of sale provided the other conditions for revenue recognition have been met. Amounts allocated to the undelivered maintenance and other services elements are recognized as the services are provided or on a straight-line basis over the service period. In certain instances, customer acceptance is required prior to the passage of title and risk of loss of the delivered products. In such cases, revenue is not recognized until the customer acceptance is obtained. Delivery and acceptance generally occur in the same reporting period.

In situations where PAR’s solutions contain software related services (generally PCS and professional services), revenue is recognized in accordance with authoritative guidance on software revenue recognition. For the software and software-related elements of such transactions, revenue is allocated based on the relative fair value of each element, and fair value is determined by vender specific objective evidence, where available. If VSOE is not available for all elements, we will use the residual method to separate the elements as long as we have VSOE for the undelivered elements. If the Company cannot objectively determine the fair value of any undelivered element included in such multiple-element arrangements, the Company defers the revenue until all elements are delivered and services have been performed, or until fair value can objectively be determined for any remaining undelivered elements.

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Government Contracts

The Company’s contract revenues generated by the Government segment result primarily from contract services performed for the U.S. Government under a variety of cost-plus fixed fee, time-and-material, and fixed-price contracts. Revenue on cost-plus fixed fee contracts is recognized based on allowable costs for labor hours delivered, as well as other allowable costs plus the applicable fee. Revenue on time and material contracts is recognized by multiplying the number of direct labor hours delivered in the performance of the contract by the contract billing rates and adding other direct costs as incurred. Revenue from fixed-price contracts is recognized as labor hours are delivered, which approximates the straight-line basis of the life of the contract. The Company’s obligation under these contracts is to provide labor hours to conduct research or to staff facilities with no other deliverables or performance obligations. Anticipated losses on all contracts are recorded in full when identified. Unbilled accounts receivable are stated in the Company’s consolidated financial statements at their estimated realizable value. Contract costs, including indirect expenses, are subject to audit and adjustment through negotiations between the Company and U.S. Government representatives.

Accounts Receivable-Allowance for Doubtful Accounts

Allowances for doubtful accounts are based on estimates of probable losses related to accounts receivable balances. The establishment of allowances requires the use of judgment and assumptions regarding probable losses on receivable balances. The Company continuously monitors collections and payments from our customers and maintain a provision for estimated credit losses based on our historical experience and any specific customer collection issues that we have identified. Thus, if the financial condition of our customers were to deteriorate, our actual losses may exceed our estimates, and additional allowances would be required.

Inventories

The Company’s inventories are valued at the lower of cost or market, with cost determined using the first-in, first-out (“FIFO”) method. The Company uses certain estimates and judgments and considers several factors including product demand, changes in customer requirements and changes in technology to provide for excess and obsolescence reserves to properly value inventory.

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Capitalized Software Development Costs

The Company capitalizes certain costs related to the development of computer software used in its hospitality segment. Software development costs incurred prior to establishing technological feasibility are charged to operations and included in research and development costs. The technological feasibility of a computer software product is established when the Company has completed all planning, designing, coding, and testing activities that are necessary to establish that the product can be produced to meet its design specifications including functions, features, and technical performance requirements. Software development costs incurred after establishing feasibility ((as defined within ASC 985-20 for software cost related to sold as a perpetual license and ASC-350-40 for software sold as a service) are capitalized and amortized on a product-by-product basis when the product is available for general release to customers. Annual amortization, charged to cost of sales when the product is available for general release to customers, is computed using the greater of (a) the straight-line method over the remaining estimated economic life of the product, generally three to seven years or (b) the ratio that current gross revenues for a product bear to the total of current and anticipated future gross revenues for that product.

Accounting for Business Combinations

The Company accounts for acquired businesses using the acquisition method of accounting, which requires that assets acquired and liabilities assumed be recorded at their respective fair values on the date of acquisition. The fair value of the consideration paid is assigned to the underlying net assets of the acquired business based on their respective fair values. Any excess of the purchase price over the estimated fair values of the net assets acquired is recorded to goodwill. Intangible assets are amortized over the expected life of the asset. Fair value determinations and useful life estimates are based on, among other factors, estimates of expected future cash flows from revenues of the intangible assets acquired, estimates of appropriate discount rates used to present value expected future cash flows, estimated useful lives of the intangible assets acquired and other factors. Although the Company believes the assumptions and estimates it has made have been reasonable and appropriate, they are based, in part, on historical experience, information obtained from the management of the acquired companies and future expectations. For these and other reasons, actual results may vary significantly from estimated results.

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Contingent Consideration

The Company determines the acquisition date fair value of contingent consideration using a discounted cash flow method, with significant inputs that are not observable in the market and thus represents a Level 3 fair value measurement as defined in ASC Topic 820, Fair Value Measurement. The significant inputs in the Level 3 measurement not supported by market activity included the Company’s probability assessments of expected future cash flows related to the Company’s acquisition of Brink Software Inc. during the contingent consideration period, appropriately discounted considering the uncertainties associated with the obligation, and calculated in accordance with the terms of the definitive agreement. The liabilities for the contingent consideration are established at the time of the acquisition and will be evaluated on a quarterly basis based on additional information as it becomes available. Any change in the fair value adjustment is recorded in the earnings of that period. During fiscal year 2015, the Company recorded a $90,000 adjustment to increase the fair value of its contingent consideration related to the acquisition of Brink Software Inc.. This is reflected within other expense on the statement of operations. Changes in the fair value of the contingent consideration obligations may result from changes in probability assumptions with respect to the likelihood of achieving the various contingent payment obligations.Significant increases or decreases in the inputs noted above in isolation would result in a significantly lower or higher fair value measurement.

Goodwill

The Company tests goodwill for impairment on an annual basis on the first day of the fourth quarter, or more often if events or circumstances indicate there may be impairment. The Company operates in two business segments, hospitality and government. Goodwill impairment testing is performed at the sub-segment level (referred to as a reporting unit). For fiscal year 2015, the two reporting units utilized by the Company for its impairment testing are: restaurants and government as compared to three reporting units tested in 2014 or restaurants, hotel/spa and government. Goodwill is assigned to a specific reporting unit at the date the goodwill is initially recorded. Once goodwill has been assigned to a specific reporting unit, it no longer retains its association with a particular acquisition, and all of the activities within a reporting unit, whether acquired or organically grown, are available to support the value of the goodwill.

Goodwill impairment analysis is a two-step test. The first step, used to identify potential impairment, involves comparing each reporting unit’s fair value to its carrying value including goodwill. If the fair value of a reporting unit exceeds its carrying value, applicable goodwill is considered not to be impaired. If the carrying value exceeds fair value, there is an indication of impairment, at which time a second step would be performed to measure the amount of impairment. The second step involves calculating an implied fair value of goodwill for each reporting unit for which the first step indicated impairment.

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The Company utilizes different methodologies in performing its goodwill impairment test. For both the government and restaurant reporting units, these methodologies include both an income approach, namely a discounted cash flow method, and multiple market approaches and the guideline public company method and quoted price method. The valuation methodologies and weightings used in the current year are generally consistent with those used in the Company’s past annual impairment tests.

The discounted cash flow method derives a value by determining the present value of a projected level of income stream, including a terminal value. This method involves the present value of a series of estimated future cash flows at the valuation date by the application of a discount rate, one which a prudent investor would require before making an investment in the equity of the Company. The Company considers this method to be most reflective of a market participant’s view of fair value given the current market conditions, as it is based on the Company’s forecasted results and, therefore, established its weighting at 80% of the fair value calculation.

Key assumptions within the Company’s discounted cash flow model utilized for its annual impairment test included projected financial operating results, a long term growth rate of 3% and discount rates ranging from 17.5% to 21%, depending on the reporting unit. As stated above, as the discounted cash flow method derives value from the present value of a projected level of income stream, a modification to the Company’s projected operating results including changes to the long term growth rate could impact the fair value. The present value of the cash flows is determined using a discount rate based on the capital structure and capital costs of comparable public companies, as well as company-specific risk premium, as identified by the Company. A change to the discount rate could impact the fair value determination.

The market approach is a generally-accepted way of determining a value indication of a business, business ownership interest, security or intangible asset by using one or more methods that compare the subject to similar businesses, business ownership interests, securities or intangible assets that have been sold. There are two methodologies considered under the market approach: the public company method and the quoted price method.

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The public company method and quoted price method of appraisal are based on the premise that pricing multiples of publicly traded companies can be used as a tool to be applied in valuing closely held companies. The mechanics of the method require the use of the stock price in conjunction with other factors to create a pricing multiple that can be used, with certain adjustments, to apply against the subject’s similar factor to determine an estimate of value for the subject company. The Company considered these methods appropriate as they provide an indication of fair value as supported by current market conditions. The Company established its weighting at 10% of the fair value calculation for the public company method and quoted price method for both the government and restaurant reporting unit.

The most critical assumption underlying the market approaches utilized by the Company are the comparable companies utilized. Each market approach described above estimates revenue and earnings multiples for the Company based on its comparable companies. As such, a change to the comparable companies could have an impact on the fair value determination.

The amount of goodwill carried by the restaurant and government reporting units is $10.3 million and $0.7 million, respectively. The estimated fair value of the restaurant reporting unit exceeds its carrying value by approximately 18%. The estimated fair value of the government reporting unit is substantially in excess of its carrying value. There were no goodwill impairment charges recorded for the restaurant and government reporting units for the years ended December 31, 2015 or 2014.

During fiscal year 2015, the Company performed a strategic analysis of its current product and business unit offerings and as a result, entered into an asset purchase agreement to sell substantially all of the assets of its hotel/spa technology business operated under PAR Springer-Miller Systems, Inc. (“PSMS”) to affiliates of Constellation Software Inc. This transaction closed on November 4, 2015. Accordingly, the results of operations of PSMS have been classified as discontinued operations in accordance with Accounting Standards Codification (“ASC”) 205-20, Presentation of Financial Statements – Discontinued Operations. All prior period amounts have been reclassified to conform to the current period presentation. Refer to Note 3 “Discontinued Operations” in the Notes to the Consolidated Financial Statements for further discussion. At the time of sale, the hotel/spa reporting unit carried approximately $6.1 million of goodwill. Based on the purchase price, the Company recorded a $2.4 million impairment of the goodwill to write down the net assets to its fair value. In connection with the sale, the Company wrote-off the remaining goodwill balance associated with the hotel/spa reporting unit.

Restaurants:

In deriving its fair value estimates, the Company has utilized key assumptions built on the current core business adjusted to reflect anticipated revenue increases from continued investment in its next generation software. These assumptions, specifically those included within the discounted cash flow estimate, are comprised of the revenue growth rate, gross margin, operating expenses, working capital requirements, and depreciation and amortization expense.

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The Company has utilized annual revenue growth rates ranging between 7% and 15%. The high end growth rate reflects the Company’s projected revenues resulting from the increased install base of Brink POS and SureCheck customers. These software platforms will expand the Company’s capabilities into new markets. The Company believes these estimates are reasonable given the size of the overall market which it will enter, combined with the projected market share the Company expects to achieve. Overall, the projected revenue growth rates ultimately trend to an estimated long term growth rate of 3%.

The Company has utilized gross margin estimates that are reflective of increased recurring revenue from software sold as a service that will exceed historical gross margins achieved. Estimates of operating expenses, working capital requirements and depreciation and amortization expense utilized for this reporting unit are generally consistent with actual historical amounts, adjusted to reflect its continued investment and projected revenue growth from the Company’s core technology platforms. The Company believes utilization of actual historical results adjusted to reflect its continued investment in its products is an appropriate basis supporting the fair value of the restaurant reporting unit.

Lastly, the Company utilized a discount rate of approximately 21% for this reporting unit. This estimate was derived through a combination of current risk-free interest rate data, financial data from companies that PAR has deemed as its competitors, and was based on volatility between the Company’s historical financial projections and actual results achieved.

The current economic conditions and the continued volatility in the U.S. and in many other countries in which the Company operates could contribute to decreased consumer confidence and continued economic uncertainty which may adversely impact the Company’s operating performance. Although the Company has seen an improvement in the markets which it serves, the continued volatility in these markets could have an impact on purchases of the Company’s products, which could result in a reduction of sales, operating income and cash flows. Reductions in these results could have a material adverse impact on the underlying estimates used in deriving the fair value of the Company’s reporting units used in support of its annual goodwill impairment test or could result in a triggering event requiring a fair value re-measurement, particularly if the Company is unable to achieve the estimates of revenue growth indicated in the preceding paragraphs. These conditions may result in an impairment charge in future periods.

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Government:

The estimated fair value of the government reporting unit is substantially in excess of its carrying value. Consistent with prior year methodology, in deriving its fair value estimates, the Company has utilized key assumptions built on the current core business. These assumptions, specifically those included within the discounted cash flow estimate, are comprised of the revenue growth rate, gross margin, operating expenses, working capital requirements, and depreciation and amortization expense.

The Company has reconciled the aggregate estimated fair value of the reporting units to the market capitalization of the consolidated Company, including a reasonable control premium noting no impairment as of December 31, 2015 or 2014 was recorded.

Deferred Taxes

The Company has significant amounts of deferred tax assets that are reviewed for recoverability and valued accordingly. These assets are evaluated by using estimates of future taxable income and the impact of tax planning strategies. Valuations related to tax accruals and assets can be impacted by changes to tax codes, changes in statutory tax rates and the Company’s estimates of its future taxable income levels.

New Accounting Pronouncements Not Yet Adopted

See Note 1 to the Consolidated Financial Statements included in Part IV, Item 15 of this Report for details of New Accounting Pronouncements Not Yet Adopted.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements.

Item 7A.

Quantitative and Qualitative Disclosures about Market Risk

inflation

Inflation had little effect on revenues and related costs during 2015. Management anticipates that margins will be maintained at acceptable levels to minimize the effects of inflation, if any.

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interest rates

As of December 31, 2015, the Company does not have any variable debt. The Company believes that an adverse change in interest rates of 100 basis points would not have a material impact on PAR’s business, financial condition, results of operations or cash flows.

foreign currency

The Company's primary exposures relate to certain non-dollar denominated sales and operating expenses in Europe and Asia. These primary currencies are the Great British Pound, the Euro, the Australian dollar, the Singapore dollar and the Chinese Renminbi. Accordingly, changes in exchange rates may negatively affect our revenue and net income (loss) as expressed in U.S. dollars. We also have foreign currency risk related to foreign currency transactions and monetary assets and liabilities, including intercompany balances denominated in currencies that are not the functional currency. We have experienced and will continue to experience fluctuations in our net income (loss) as a result of gains (losses) on these foreign currency transactions and the remeasurement of monetary assets and liabilities. To date, the impacts of foreign currency exchange rate changes on our revenues and net income (loss) have not been material. The volatility of exchange rates depends on many factors that we cannot forecast with reliable accuracy.

Item 8:

Financial Statements and Supplementary Data

The Company’s 2015 consolidated financial statements, together with the report thereon of BDO USA, LLP dated March 30, 2016, are included elsewhere herein. See Part IV, Item 15 for a list of Financial Statements.

Item 9:

Changes in and Disagreements With Accounting and Financial Disclosure

None.

Item 9A:

Controls and Procedures

Evaluation of Disclosure Controls and Procedures.

Based on an evaluation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of December 31, 2015, the end of the period covered by this Annual Report on Form 10-K (the “Evaluation Date”), conducted under the supervision of and with the participation of the Company’s chief executive officer and chief accounting officer, performing the function of the principal financial officer, such officers have concluded that the Company’s disclosure controls and procedures, which are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and designed to ensure that information required to be disclosed by the Company in the reports filed or submitted under the Exchange Act is accumulated and communicated to management, including the chief executive and financial officers, as appropriate, to allow timely decisions regarding required disclosures, are not effective because of a material weakness over financial reporting as of the Evaluation Date described below.

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Management’s Report on Internal Control over Financial Reporting.

PAR’s management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Rule 13a-15(f) under the Exchange Act. The Company’s internal control system has been designed to provide reasonable assurance to management and the Board of Directors regarding the preparation and fair presentation of published financial statements in accordance with U.S. generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (a) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (b) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being

made only in accordance with authorizations of management and directors of the company; and (c) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.

All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of inherent limitations due to, for example, the potential for human error or circumvention of controls, internal controls over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

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PAR’s management, under the supervision of and with the participation of the Company’s chief executive officer and chief accounting officer, performing the function of the principal financial officer, assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2015. Management based this assessment on criteria for effective internal control over financial reporting described in the 2013 “Internal Control – Integrated Framework” issued by the Committee of Sponsoring Organizations (“COSO”) of the Treadway Commission. Based on its assessment, based on those criteria, management believes that as of December 31, 2015, the Company’s internal control over financial reporting was ineffective and a material weakness existed. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. The existence of one or more material weaknesses precludes a conclusion by management that a corporation’s internal control over financial reporting is effective.

As mentioned in Note 1 of the Notes to Consolidated Financial Statements, the Company identified certain wire transfers made in connection with unauthorized investments involving Company funds that were in contravention of the Company’s policies and procedures. The unauthorized investments occurred during the period between September 25, 2015 and November 6, 2015. The employment of Michael S. Bartusek, the Company’s Vice President and Chief Financial Officer was terminated effective March 14, 2016 for cause in connection with these unauthorized investments made in contravention of the Company’s policies and procedures. Mr. Bartusek had been hired by the Company into those positions effective July 20, 2015. These funds, collectively, total $776,000. Upon evaluation of the circumstances under which such unauthorized investments were made, the Company determined that internal control weaknesses existed that permitted these wire transfers to be initiated, processed and completed without obtaining the necessary approvals. This matter was reported by management to the Audit Committee of the Company’s Board of Directors, comprised solely of independent directors. Under the direction of the Independent Audit Committee, an investigation was commenced and completed, although the Company continues to pursue recovery of the funds. The investigation was led by outside counsel, and they engaged an independent forensic consultant to assist in the matter. As directed by the Audit Committee, the Company has reported this matter to federal law enforcement agencies, including the U.S. Securities and Exchange Commission.

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We believe that a number of weaknesses in our internal controls over financial reporting enabled these unauthorized transactions to be effected. In particular, we have identified that our pre-hiring diligence procedures failed to require the completion of a satisfactory background investigation, which should have included credit and other public record and media checks for accounting and financial hires to the extent permitted by applicable law. In addition, our procedures relating to treasury transactions did not require sufficient sign-off documentation and review thereof with respect to approvals required prior to initiating treasury transactions, and as a result, documentation describing the transaction, confirming its execution and evidencing the required approvals did not exist or was significantly deficient, thus impeding prevention or early detection of the improper actions. While we determined that no material adjustment was required to our previously reported consolidated financial statements, we determined that the aggregation of these internal control deficiencies, combined with the influence and span of control of our former Chief Financial Officer, while such influence and control was limited, resulted in a material weakness in the Company’s internal control environment. To remediate the material weakness, the Company’s President and Chief Executive Officer has engaged an outside consulting firm to perform a thorough review of its internal controls over financial reporting, specifically, onboarding of new employees and controls over treasury transactions. The Company will begin to implement the recommendations from the consulting firm during 2016 and anticipates making material changes to such controls to strengthen its internal control environment.

Remediation of the Material Weakness.

The Company is evaluating the material weakness and developing a plan of remediation to strengthen our overall internal control. The remediation plan will include the following actions:

We have engaged a consulting firm to perform a thorough review of internal controls over financial reporting, with specific attention given to onboarding of new employees and controls over treasury transactions

We expect to design and implement new onboarding procedures over financial executives and those employees who are responsible for treasury transactions

We expect that the plan of remediation will enhance the formality and rigor of review and approval procedures.

The Company is committed to strengthening its internal control environment and believes that these remediation efforts will represent significant improvements in our controls. The Company has started to implement these steps, however, some of these steps will take time to be fully integrated and confirmed to be effective and sustainable. Additional controls may also be required over time. Until the remediation steps set forth above are fully implemented and tested, the material weakness described above will continue to exist.

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Changes in Internal Controls over Financial Reporting.

During the Company’s last fiscal quarter of 2015 (the fourth fiscal quarter), there were no changes in the Company’s internal control over financial reporting (as defined in Rule 13 a-15(f)) that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART III

Item 10:

Directors, Executive Officers and Corporate Governance

The information required by this item will appear under the caption “Directors, Executive Officers and Corporate Governance” in our 2016 definitive proxy statement for the annual meeting of stockholders on May 18, 2016, to be filed under Schedule 14A, and is incorporated herein by reference.

Item 11:

Executive Compensation

The information required by this item will appear under the caption “Executive Compensation” in our 2016 definitive proxy statement for the annual meeting of stockholders on May 18, 2016, to be filed under Schedule 14A, and is incorporated herein by reference.

Item 12:

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by this item will appear under the caption “Security Ownership of Management and Certain Beneficial Owners” in our 2016 definitive proxy statement for the annual meeting of stockholders on May 18, 2016, to be filed under Schedule 14A, and is incorporated herein by reference.

Item 13:

Certain Relationships and Related Transactions, and Director Independence

Item 14:

Principal Accounting Fees and Services

The response to this item will appear under the caption “Principal Accounting Fees and Services” in our 2016 definitive proxy statement for the annual meeting of stockholders on May 18, 2016, to be filed under Schedule 14A, and is incorporated herein by reference.

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PART IV

Item15:

Exhibits, Financial Statement Schedules

Form 10-K Page

(a)	Documents filed as a part of the Form 10-K

Financial Statements:

	Report of Independent Registered Public Accounting Firm	53
	Consolidated Balance Sheets at December 31, 2015 and 2014	54
	Consolidated Statements of Operations for the years ended December 31, 2015 and 2014	55
	Consolidated Statements of Comprehensive Loss for the years ended December 31, 2015 and 2014	56
	Consolidated Statements of Changes in Shareholders’ Equity for the years ended December 31, 2015 and 2014	57
	Consolidated Statements of Cash Flows for the years ended December 31, 2015 and 2014	58
	Notes to Consolidated Financial Statements	59

(b)

Exhibits

See list of exhibits on page 90.

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Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholders

PAR Technology Corporation

New Hartford, New York

We have audited the accompanying consolidated balance sheets of PAR Technology Corporation and subsidiaries (the “Company”) as of December 31, 2015 and 2014, and the related consolidated statements of operations, comprehensive loss, changes in shareholders’ equity, and cash flows for each of the two years then ended. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also 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 consolidated financial statements referred to above present fairly, in all material respects, the financial position of PAR Technology Corporation and subsidiaries at December 31, 2015 and 2014, and the results of their operations and their cash flows for each of the two years then ended, in conformity with accounting principles generally accepted in the United States of America.

/s/ BDO USA, LLP

New York, New York

March 30, 2016

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PAR TECHNOLOGY CORPORATION

CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)

	December 31,
Assets	2015			2014
Current assets:
Cash and cash equivalents	$	8,024		$	9,867
Accounts receivable-net		29,530			29,674
Inventories-net		21,499			25,928
Deferred income taxes		6,741			4,512
Other current assets		3,808			4,018
Assets of discontinued operations		-			22,119
Total current assets		69,602			96,118
Property, plant and equipment - net		5,716			5,148
Note receivable		3,320			-
Deferred income taxes		11,038			11,357
Goodwill		11,051			11,051
Intangible assets - net		10,898			10,580
Other assets		3,687			3,043
Total Assets	$	115,312		$	137,297
Liabilities and Shareholders’ Equity
Current liabilities:
Current portion of long-term debt	$	2,103		$	3,173
Borrowings under line of credit		-			5,000
Accounts payable		11,729			19,258
Accrued salaries and benefits		5,727			5,726
Accrued expenses		6,705			6,492
Customer deposits		180			1,242
Deferred service revenue		10,639			10,388
Income taxes payable		279			475
Liabilities of discontinued operations		441			4,617
Total current liabilities		37,803			56,371
Long-term debt		566			2,566
Other long-term liabilities		8,883			8,847
Total liabilities		47,252			67,784
Commitments and contingencies
Shareholders’ Equity:
Preferred stock, $.02 par value, 1,000,000 shares authorized		-			-
Common stock, $.02 par value, 29,000,000 shares authorized; 17,352,198 and 17,274,708 shares issued, 15,644,729 and 15,566,599 outstanding at December 31, 2015 and 2014, respectively		347			346
Capital in excess of par value		45,753			44,854
Retained earnings		30,574			31,465
Accumulated other comprehensive loss		(2,778	)		(1,316	)
Treasury stock, at cost, 1,708,109 shares		(5,836	)		(5,836	)
Total shareholders’ equity		68,060			69,513
Total Liabilities and Shareholders’ Equity	$	115,312		$	137,297

See accompanying notes to consolidated financial statements

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PAR TECHNOLOGY CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

	Year ended December 31,
	2015			2014
Net revenues:
Product	$	94,397		$	84,484
Service		46,754			45,690
Contract		87,852			87,689
		229,003			217,863
Costs of sales:
Product		68,192			58,889
Service		32,824			35,011
Contract		81,848			82,347
		182,864			176,247
Gross margin		46,139			41,616
Operating expenses:
Selling, general and administrative		28,276			28,974
Research and development		10,247			8,947
Amortization of identifiable intangible assets		987			279
		39,510			38,200

Operating income from continuing operations		6,629			3,416
Other (expense) income, net		(800	)		485
Interest expense		(308	)		(136	)
Income from continuing operations before provision for income taxes		5,521			3,765
Provision for income taxes		(1,500	)		(3,694	)
Income from continuing operations		4,021			71
Discontinued operations
Loss on discontinued operations (net of tax)		(4,912	)		(3,722	)
Net loss	$	(891	)	$	(3,651	)
Basic Earnings per Share:
Income from continuing operations		0.26			0.00
Loss from discontinued operations		(0.32	)		(0.24	)
Net Loss	$	(0.06	)	$	(0.24	)
Diluted Earnings per Share:
Income from continuing operations		0.26			0.00
Loss from discontinued operations		(0.32	)		(0.24	)
Net loss	$	(0.06	)	$	(0.24	)
Weighted average shares outstanding
Basic		15,562			15,501
Diluted		15,666			15,582

See accompanying notes to consolidated financial statements

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PAR TECHNOLOGY CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in thousands)

	Year ended December 31,
	2015			2014

Net loss	$	(891	)	$	(3,651	)
Other comprehensive loss net of applicable tax:
Foreign currency translation adjustments		(1,462	)		(777	)
Comprehensive loss	$	(2,353	)	$	(4,428	)

See accompanying notes to consolidated financial statements

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PAR TECHNOLOGY CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

(in thousands)

	Common Stock						Capital in excess of			Retained			Accumulated Other Comprehensive			Treasury Stock						Total Shareholders’
(in thousands)	Shares			Amount			Par Value			Earnings			Loss			Shares			Amount			Equity

Balances at December 31, 2013		17,302		$	344		$	43,635		$	35,116		$	(539	)		(1,708	)	$	(5,836	)	$	72,720

Net loss											(3,651	)											(3,651	)
Net issuance of restricted stock awards		(27	)		2																		2
Equity based compensation								1,185															1,185
Stock options and awards tax benefits								34															34
Translation adjustments, net of tax of $476														(777	)								(777	)
Balances at December 31, 2014		17,275			346			44,854			31,465			(1,316	)		(1,708	)		(5,836	)		69,513

Net loss											(891	)											(891	)
Issuance of common stock upon the exercise of stock options		94			2			472															474
Net issuance of restricted stock awards		(17	)		(1	)																	(1	)
Equity based compensation								487															487
Stock options and awards tax benefits								(60	)														(60	)
Translation adjustments, net of tax of $944														(1,462	)								(1,462	)
Balances at December 31, 2015		17,352		$	347		$	45,753		$	30,574		$	(2,778	)		(1,708	)	$	(5,836	)	$	68,060

See accompanying notes to consolidated financial statements

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PAR TECHNOLOGY CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Year ended December 31,
	2015			2014
Cash flows from operating activities:
Net loss	$	(891	)	$	(3,651	)
Loss from discontinued operations		4,912			3,722
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Loss on investment		776			-
Depreciation, amortization and accretion		3,070			2,007
Provision for bad debts		772			340
Provision for obsolete inventory		1,293			2,232
Equity based compensation		487			1,185
Change in fair value of contingent consideration		90			-
Deferred income tax		(1,910	)		516
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable		(628	)		(700	)
Inventories		3,136			(3,826	)
Income tax receivable/(payable)		(196	)		290
Other current assets		210			(1,129	)
Other assets		(644	)		(368	)
Accounts payable		(7,529	)		3,022
Accrued salaries and benefits		1			(425	)
Accrued expenses		213			4,572
Customer deposits		(1,062	)		1,060
Deferred service revenue		251			645
Other long-term liabilities		(54	)		93
Deferred tax equity based compensation		(60	)		-
Net cash provided by operating activities-continuing operations		2,237			9,585
Net cash used in operating activities-discontinued operations		(1,643	)		(3,324	)
Net cash provided by operating activities		594			6,261
Cash flows from investing activities:
Capital expenditures		(1,705	)		(1,536	)
Capitalization of software costs		(2,148	)		(1,650	)
Investment expenditure		(776	)		-
Payments for acquisition, net of cash acquired		-			(5,000	)
Proceeds from sale of business		12,100			-
Net cash provided by (used in) investing activities-continuing operations		7,471			(8,186	)
Net cash used in investing activities-discontinued operations		(1,046	)		(1,816	)
Net cash provided by (used in) investing activities		6,425			(10,002	)
Cash flows from financing activities:
Payments of long-term debt		(173	)		(165	)
Payments of other borrowings		(222,156	)		(39,771	)
Proceeds from other borrowings		217,156			44,771
Payments for deferred acquisition obligations		(3,000	)		-
Proceeds from stock awards		473			2
Net cash (used in) provided by financing activities		(7,700	)		4,837
Effect of exchange rate changes on cash and cash equivalents		(1,462	)		(944	)
Net (decrease) increase in cash and cash equivalents		(2,143	)		152
Cash and cash equivalents at beginning of period		10,167			10,015
Cash and cash equivalents at end of period		8,024			10,167
Less cash and cash equivalents of discontinued operations at end of period		-			300
Cash and cash equivalents of continuing operations at end of period	$	8,024		$	9,867

Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest	$	206		$	129
Income taxes, net of refunds	$	310		$	722

Supplemental disclosures of non-cash information:
Acquisition through notes payable	$	-		$	4,820
Contingent consideration payable in connection with acquisition	$	-		$	5,040
Sale of business through note receivable	$	3,320		$	-

See accompanying notes to consolidated financial statements

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 — Summary of Significant Accounting Policies

Basis of consolidation

The consolidated financial statements include the accounts of PAR Technology Corporation and its subsidiaries (ParTech, Inc., ParTech (Shanghai) Company Ltd., PAR Springer-Miller Systems, Inc., Springer-Miller Canada, ULC, PAR Canada ULC, PAR Government Systems Corporation and Rome Research Corporation, Brink Software, Inc.), collectively referred to as the “Company.” All significant intercompany transactions have been eliminated in consolidation.

During the third quarter of fiscal year 2015, the Company performed a strategic analysis of its current product and business unit offerings and as a result, entered into an asset purchase agreement to sell substantially all of the assets of its hotel/spa technology business operated under PAR Springer-Miller Systems, Inc. (“PSMS”) to affiliates of Constellation Software Inc. This transaction closed on November 4, 2015. Accordingly, the results of operations of PSMS have been classified as discontinued operations in accordance with Accounting Standards Codification (“ASC”) 205-20, Presentation of Financial Statements – Discontinued Operations. All prior period amounts have been reclassified to conform to the current period presentation. Refer to Note 3 “Discontinued Operations” in the Notes to the Consolidated Financial Statements for further discussion.

Business combinations

The Company accounts for business combinations pursuant ASC 805, Business Combinations, which requires that assets acquired and liabilities assumed be recorded at their respective fair values on the date of acquisition. The fair value of the consideration paid is assigned to the underlying net assets of the acquired business based on their respective fair values. Any excess of the purchase price over the estimated fair values of the net assets acquired is allocated to goodwill (the “Acquisition Method”). The purchase price allocation process requires the Company to make significant assumptions and estimates in determining the purchase price and the assets acquired and liabilities assumed at the acquisition date. The Company’s assumptions and estimates are subject to refinement and, as a result, during the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon conclusion of the measurement period, any subsequent adjustments are recorded to the Company’s consolidated statements of operations. The Company’s consolidated financial statements and results of operations reflect an acquired business after the completion of the acquisition.

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Contingent Consideration

The Company determines the acquisition date fair value of contingent consideration using a discounted cash flow method, with significant inputs that are not observable in the market and thus represents a Level 3 fair value measurement as defined in ASC Topic 820, Fair Value Measurement. The significant inputs in the Level 3 measurement not supported by market activity included the Company’s probability assessments of expected future cash flows related to the Company’s acquisition of Brink Software Inc. during the contingent consideration period, appropriately discounted considering the uncertainties associated with the obligation, and calculated in accordance with the terms of the definitive agreement. The liabilities for the contingent consideration are established at the time of the acquisition and will be evaluated on a quarterly basis based on additional information as it becomes available. Any change in the fair value adjustment is recorded in the earnings of that period. During fiscal year 2015, the Company recorded a $90,000 adjustment to increase the fair value of its contingent consideration related to the acquisition of Brink Software Inc. This is reflected within other expense on the statement of operations. Changes in the fair value of the contingent consideration obligations may result from changes in probability assumptions with respect to the likelihood of achieving the various contingent payment obligations.Significant increases or decreases in the inputs noted above in isolation would result in a significantly lower or higher fair value measurement.

Revenue recognition policy

Hospitality Contracts

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Hardware

Revenue recognition on hardware sales occurs upon delivery to the customer site (or when shipped for systems that are not installed by the Company) when persuasive evidence of an arrangement exists, delivery has occurred, the price is fixed or determinable, and collectability is reasonably assured.

Software

Service

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In situations where PAR’s solutions contain software related services (generally PCS and professional services), revenue is recognized in accordance with authoritative guidance on software revenue recognition. For the software and software-related elements of such transactions, revenue is allocated based on the relative fair value of each element, and fair value is determined by vender specific objective evidence (VSOE), where available. If VSOE is not available for all elements, we will use the residual method to separate the elements as long as we have VSOE for the undelivered elements. If the Company cannot objectively determine the fair value of any undelivered element included in such multiple-element arrangements, the Company defers the revenue until all elements are delivered and services have been performed, or until fair value can objectively be determined for any remaining undelivered elements.

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Government Contracts

The Company’s contract revenues generated by the Government segment result primarily from contract services performed for the U.S. Government under a variety of cost-plus fixed fee, time-and-material, and fixed-price contracts. Revenue on cost-plus fixed fee contracts is recognized based on allowable costs for labor hours delivered, as well as other allowable costs plus the applicable fee. Revenue on time and material contracts is recognized by multiplying the number of direct labor hours delivered in the performance of the contract by the contract billing rates and adding other direct costs as incurred. Revenue from fixed-price contracts is recognized as labor hours are delivered which approximates the straight-line basis of the life of the contract. The Company’s obligation under these contracts is to provide labor hours to conduct research or to staff facilities with no other deliverables or performance obligations. Anticipated losses on all contracts are recorded in full when identified. Unbilled accounts receivable are stated in the Company’s consolidated financial statements at their estimated realizable value. Contract costs, including indirect expenses, are subject to audit and adjustment through negotiations between the Company and U.S. Government representatives.

Warranty Provisions

Warranty provisions for product warranties are recorded in the period in which PAR becomes obligated to honor the related right, which generally is the period in which the related product revenue is recognized. The Company accrues warranty reserves based upon historical factors such as labor rates, average repair time, travel time, number of service calls per machine and cost of replacement parts. When a sale is consummated, a warranty reserve is recorded based upon the estimated cost to provide the service over the warranty period.

Cash and cash equivalents

The Company considers all highly liquid investments, purchased with a remaining maturity of three months or less, to be cash equivalents.

Accounts receivable – Allowance for doubtful accounts

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Inventories

Property, plant and equipment

Property, plant and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the assets, which range from three to twenty-five years. Expenditures for maintenance and repairs are expensed as incurred.

Other assets

Other assets primarily consist of cash surrender value of life insurance related to the Company’s Deferred Compensation Plan eligible to certain employees. The funded balance is reviewed on an annual basis.

Income taxes

The provision for income taxes is based upon pretax earnings with deferred income taxes provided for the temporary differences between the financial reporting basis and the tax basis of the Company’s assets and liabilities. The Company records a valuation allowance when necessary to reduce deferred tax assets to their net realizable amounts. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

Other long-term liabilities

Other long-term liabilities represent amounts owed to certain employees who are participants in the Company’s Deferred Compensation Plan and the estimated fair value of the contingent consideration payable related to the Brink Software Inc. acquisition.

Foreign currency

The assets and liabilities for the Company’s international operations are translated into U.S. dollars using year-end exchange rates. Income statement items are translated at average exchange rates prevailing during the year. The resulting translation adjustments are recorded as a separate component of shareholders’ equity under the heading Accumulated Other Comprehensive Loss. Exchange gains and losses on intercompany balances of permanently invested long-term loans are also recorded as a translation adjustment and are included in Accumulated Other Comprehensive Loss. Foreign currency transaction gains and losses are recorded in other income in the accompanying statements of operations.

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Other (expense) income

The components of other (expense) income from continuing operations for the two years ending December 31 are as follows:

	Year ended December 31 (in thousands)
	2015			2014

Foreign currency loss	$	(193	)	$	(115	)
Rental income-net		264			359
Investment write-off		(776	)		-
Other		(95	)		241
	$	(800	)	$	485

The investment write-off of $776,000 in fiscal year 2015 represents the write-off of unauthorized investments that were made in contravention of the Company’s policies and procedures involving the Company’s funds. The unauthorized investments occurred during the period between September 25, 2015 and November 6, 2015. As of December 31, 2015, the Company is uncertain of the collectability of funds relating to these investments and as a result, reduced its fair value to zero. The write-off of the investment resulted in the Company identifying a material weakness over financial reporting as described in Item 9A.

Identifiable intangible assets

The Company’s identifiable intangible assets represent intangible assets acquired from the Brink Software Inc. acquisition as well as internally developed software costs. The Company capitalizes certain costs related to the development of computer software used in its hospitality segment. Software development costs incurred prior to establishing technological feasibility are charged to operations and included in research and development costs. The technological feasibility of a computer software product is established when the Company has completed all planning, designing, coding, and testing activities that are necessary to establish that the product can be produced to meet its design specifications including functions, features, and technical performance requirements. Software development costs incurred after establishing feasibility (as defined within ASC 985-20 for software cost related to sold as a perpetual license and ASC-350-40 for software sold as a service) are capitalized and amortized on a product-by-product basis when the product is available for general release to customers. Software costs capitalized within continuing operations during the periods ended December 31, 2015 and 2014 were $2.1 million and $1.7 million, respectively.

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Annual amortization, charged to cost of sales when the product is available for general release to customers, is computed using the greater of (a) the straight-line method over the remaining estimated economic life of the product, generally three to seven years or (b) the ratio that current gross revenues for a product bear to the total of current and anticipated future gross revenues for that product. Amortization of capitalized software costs from continuing operations amounted to $843,000 and $673,000, in 2015 and 2014, respectively. The Company assessed its recoverability of capitalized software assets noting no impairments were recorded in 2015 or 2014.

In 2014, the Company acquired identifiable intangible assets in connection with its acquisition of Brink Software Inc. Amortization of intangible assets acquired from the Brink Software Inc. acquisition amounted to $987,000 and $279,000 in 2015 and 2014, respectively.

The components of identifiable intangible assets, excluding discontinued operations, are:

	December 31, (in thousands)
	2015			2014			Estimated Useful Life
Acquired and internally developed software costs	$	12,725		$	10,577		3 - 7 years
Customer relationships		160			160		7 years
Non-competition agreements		30			30		1 year
		12,915			10,767
Less accumulated amortization		(2,417	)		(587	)
	$	10,498		$	10,180
Trademarks, trade names (non-amortizable)		400			400		N/A
	$	10,898		$	10,580

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The expected future amortization of these intangible assets assuming straight-line amortization of capitalized software costs and acquisition related intangibles is as follows (in thousands):


2016	$	2,012
2017		1,911
2018		1,747
2019		1,350
2020		1,174
Thereafter		2,304
Total	$	10,498

The Company has elected to test for impairment of indefinite lived intangible assets during the fourth quarter of its fiscal year. To value the indefinite lived intangible assets, the Company utilizes the royalty method to estimate the fair values of the trademarks and trade names. As a result of the testing, there was no related impairment charge recorded for the periods ended December 31, 2015 and 2014.

Stock-based compensation

The Company recognizes all stock-based compensation to employees, including grants of employee stock options and restricted stock awards, in the financial statements as compensation cost over the vesting period using an accelerated expense recognition method, based on their fair value on the date of grant.

Earnings per share

Basic earnings per share are computed based on the weighted average number of common shares outstanding during the period. Diluted earnings per share reflect the dilutive impact of outstanding stock options and restricted stock awards.

The following is a reconciliation of the weighted average shares outstanding for the basic and diluted earnings per share computations (in thousands, except share and per share data):

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	December 31,
	2015			2014
Income from continuing operations	$	4,021		$	71

Basic:
Shares outstanding at beginning of year		15,592			15,473
Weighted average shares (cancelled) issued during the year, net		(30	)		28
Weighted average common shares, basic		15,562			15,501
Income from continuing operations per common share, basic	$	0.26		$	0.00

Diluted:
Weighted average common shares, basic		15,562			15,501
Dilutive impact of stock options and restricted stock awards		104			81
Weighted average common shares, diluted		15,666			15,582
Income from continuing operations per common share, diluted	$	0.26		$	0.00

At December 31, 2015 and 2014 there were 112,000 and 215,000 incremental shares, respectively, from the assumed exercise of stock options that were excluded from the computation of diluted earnings per share because of the anti-dilutive effect on earnings per share. There were no restricted stock awards excluded from the computation of diluted earnings per share for each of the fiscal years ended December 31, 2015 and 2014.

Goodwill

The Company tests goodwill for impairment on an annual basis, which is on the first day of the fourth quarter, or more often if events or circumstances indicate there may be impairment. The Company operates in two reportable segments, referred to as business segments, Hospitality and Government. Goodwill impairment testing is performed at the sub-segment level (referred to as a reporting unit). The two reporting units utilized by the Company are: Restaurant and Government. The Hotel/Resort/Spa reporting unit was sold on November 4, 2015 and included within discontinued operations. Goodwill is assigned to reporting units at the date the goodwill is initially recorded. Once goodwill has been assigned to reporting units, it no longer retains its association with a particular acquisition, and all of the activities within a reporting unit, whether acquired or organically grown, are available to support the value of the goodwill. The amount outstanding for goodwill within continuing operations was $11.1 million at December 31, 2015 and 2014. During fiscal 2015, the decrease was a result of the divestiture of the hotel/resort/spa reporting unit. As a result of the fair value received for the Hotel/Resort/Spa divestiture, the Company recorded an impairment charge within discontinued operations of $2.4 million. During fiscal 2014, the increase was a result of $10.3 million of goodwill recorded by the Restaurant reporting unit from the acquisition of Brink Software Inc. There was no impairment of goodwill for the periods ending December 31, 2014 when testing the restaurant and government reporting units.

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The changes and carrying amounts of goodwill by reporting unit were as follows (in thousands):

	Restaurants		Hotel/Resort/ Spa			Government		Total

Net Balances at December 31, 2013	$	-	$	6,116		$	736	$	6,852
Goodwill		12,433		13,946			736		27,115
Accumulated Impairment charge		(12,433		(7,830	)		-		(20,263	)
Acquisition		10,315		-			-		10,315
Reclassified to Discontinued Operations		-		(6,116	)		-		(6,116	)
Net balance at December 31, 2014		10,315		-			736		11,051
Goodwill		22,748		13,946			736		37,430
Accumulated Impairment charge		(12,433		(10,238	)		-		(22,671	)
Divestiture		-		(3,708	)		-		(3,708	)
Net balance at December 31, 2015	$	10,315	$	-		$	736	$	11,051

Impairment of long-lived assets

The Company evaluates the accounting and reporting for the impairment of long-lived assets in accordance with the reporting requirements of ASC 360-10, Accounting for the Impairment or Disposal of Long-Lived Assets. The Company will recognize impairment of long-lived assets or asset groups if the net book value of such assets exceeds the estimated future undiscounted cash flows attributable to such assets. If the carrying value of a long-lived asset or asset group is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds the fair market value of the long-lived asset or asset group for assets to be held and used, or the amount by which the carrying value exceeds the fair market value less cost to sell for assets to be sold. No impairment was identified during 2015 or 2014.

Reclassifications

Amounts in prior years’ consolidated financial statements are reclassified whenever necessary to conform to the current year’s presentation. The results of operations of PSMS have been classified as discontinued operations in accordance with Accounting Standards Codification (“ASC”) 205-20, Presentation of Financial Statements – Discontinued Operations. All prior period amounts have been reclassified to conform to the current period presentation. Refer to Note 3 “Discontinued Operations” in the Notes to the Consolidated Financial Statements for further discussion.

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Use of estimates

The preparation of the consolidated financial statements requires management of the Company to make a number of estimates and assumptions relating to the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Significant items subject to such estimates and assumptions include revenue recognition, stock based compensation, the recognition and measurement of assets acquired and liabilities assumed in business combinations at fair value, the carrying amount of property, plant and equipment, identifiable intangible assets and goodwill, valuation allowances for receivables, inventories and deferred income tax assets, and measurement of contingent consideration at fair value. Actual results could differ from those estimates.

Recently Issued Accounting Pronouncements Not Yet Adopted

In February 2016, the FASB issued new guidance related to leases. This standard requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. The new standard is effective for the Company for the fiscal years beginning after December 15, 2018, with early adoption permitted. The Company is evaluating the impact the adoption of this standard will have on its consolidated financial statements.

In November 2015, the FASB issued new guidance related to the balance sheet classification of deferred taxes. This standard requires an entity to classify all deferred tax assets, along with any valuation allowance, as noncurrent on the balance sheet. As a result, each jurisdiction will have one net noncurrent deferred tax asset or liability. The new standard is effective for the Company for fiscal years beginning after December 15, 2016. The adoption of this standard, which may be applied either prospectively or retrospectively, is not expected to have a material impact on the Company’s consolidated financial statements.

In July 2015, the FASB issued new guidance related to the measurement of inventory. This standard changes the inventory valuation method from the lower of cost or market to the lower of cost or net realizable value for inventory valued under the first-in, first-out or average cost methods. The new standard is effective for the Company beginning in its first quarter of fiscal 2017, and requires prospective adoption with early adoption permitted. The Company is evaluating the impact the adoption of this standard will have on its consolidated financial statements.

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In April 2015, the FASB issued new guidance related to the presentation of debt issuance costs, which amends existing guidance to require the presentation of debt issuance costs in the balance sheet as a deduction from the carrying amount of the related debt liability, consistent with debt discounts, instead of a deferred charge asset. The new standard is effective for the Company beginning in its first quarter of fiscal 2016, with early adoption permitted. The Company is evaluating the impact the adoption of this standard and it is not expected to have a material impact on our consolidated financial statements.

In April 2015, the FASB issued new guidance related to accounting for the fees paid in a cloud computing arrangement, which provides guidance to customers about whether a cloud computing arrangement includes a software license. If considered a software license, the arrangement should be accounted for as an acquisition of a software license. If not considered a software license, the arrangement should be accounted for as a service contract. The new standard is effective for the Company beginning in its first quarter of fiscal 2016, with early adoption permitted. The Company is evaluating the impact the adoption of this standard and it is not expected to have a material impact on our consolidated financial statements

In September 2014, the FASB issued amended guidance on the accounting for certain share-based employee compensation awards. The amended guidance requires that share-based employee compensation awards with terms of a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award and compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved. The Company is required to adopt this guidance for its annual and interim periods beginning March 1, 2016. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

In August 2014, the FASB issued new guidance related to disclosures around going concern, including management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related disclosures when conditions or events raise substantial doubt about an entity's ability to continue as a going concern. The new standard is effective for the Company beginning in its first quarter of fiscal 2017, with early adoption permitted. The impact of adopting this guidance on January 1, 2017 is not expected to have a material impact on our consolidated financial statements.

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In May 2014, the FASB amended the existing accounting standards for revenue recognition. The amendments are based on the principle that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance provides a five-step analysis of transactions to determine when and how revenue is recognized. The guidance also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. In July 2015, the FASB affirmed its proposal of a one-year deferral of the effective date of the new revenue standard. As a result, the new guidance will be effective for the Company beginning in its first quarter of fiscal 2018. The amendments may be applied retrospectively to each prior period presented or with the cumulative effect recognized as of the date of initial application. PAR is currently evaluating the impact of these amendments and the transition alternatives on PAR's financial statements.

Recently Adopted Accounting Pronouncements

In April 2014, the FASB issued guidance that raises the threshold for a disposal to qualify as a discontinued operation and requires new disclosures of both discontinued operations and other disposals that do not meet the definition of a discontinued operations. The new guidance defines a discontinued operation as a disposal of a component or group of components that is disposed of or is classified as held for sale and represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results. The new guidance is effective on January 1, 2015, with early adoption permitted. The adoption of this amendment on January 1, 2015 did not have a significant impact on the Company's financial position or results of operations.

Note 2 — Acquisition

On September 18, 2014, PAR Technology Corporation (the "Company") and its wholly-owned subsidiary, ParTech, Inc. ("ParTech"), entered into and closed a definitive agreement with Brink Software Inc. ("Brink") and all the shareholders of Brink pursuant to which ParTech has purchased the equity interest of Brink in a two-step closing. This acquisition was to expand the Company’s cloud based POS software offerings. The guaranteed portion of the purchase price for Brink’s shares will total $10 million in cash, which is payable over a period of three years with $5.0 million paid at closing, $3.0 million paid on the first year anniversary of close, and $2.0 million payable on the second year anniversary of close. In addition to the guaranteed payments, there is a contingent consideration of up to $7.0 million payable to the former owners of Brink based on the achievement of certain conditions as defined in the definitive agreement.

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The payment of $5.0 million on September 18, 2014, was for the purchase of 51% of Brink’s outstanding shares. The remaining 49% was purchased and transferred on September 18, 2015, the first anniversary of the initial closing date, for a purchase price of $5.0 million, $3.0 million of which was paid on the second closing and the $2.0 million balance will be payable on September 18, 2016. The estimated fair value of the remaining portion of the note payable due on September 18, 2016 is approximately $1.9 million and is included within current debt in PAR’s consolidated balance sheets. Per the stock purchase agreement, Brink shareholders assigned their voting rights of the remaining 49% of Brink shares to PAR. As a result, PAR controlled 100% of the Brink shares prior to the transfer on September 18, 2015 and fully consolidated the financial results of Brink in accordance with ASC Topic 805. The agreement also provided up to $1.0 million of the purchase price to be delivered into escrow if one or more claims arise within the first twelve months of the transaction. Such escrow served as a source of payment for any indemnification obligations that may arise. No such claims arose within the first twelve months of the transaction.

The contingent purchase price maximum of $7.0 million can be earned through fiscal year 2018, based upon the achievement of certain conditions as defined in the definitive agreement. These conditions have separate targets as defined in the definitive agreement, which began on December 31, 2015. The targets for fiscal year 2015 were not met, however, the total earning potential has a cumulative effect ending fiscal year 2018. The estimated fair value of this contingent consideration is approximately $5.1 million and is included within non-current liabilities in PAR’s consolidated balance sheets (see note 13).

In determining the purchase price allocation, the Company considered, among other factors, market participants’ intentions to use the acquired assets and the historical and estimated future demand for the acquired Brink POS cloud based point of sale application.As of September 18, 2014, the Company recorded an aggregate purchase price of $14.9 million, including a cash payment of $5.0 million, net of cash acquired of $184,000, plus additional estimated cash payments of $9.9 million, which represents the fair value of the remaining consideration.

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The total purchase price was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed by the Company based on their fair values as of the closing date of the acquisition. The excess of the purchase price over those fair values was recorded to goodwill. The following table summarizes our allocation of purchase price (in thousands) at the measurement date, September 18, 2014:

Accounts receivable	$	83
Inventories		116
Intangible assets		7,190
Goodwill		10,315
Other assets		90
Total assets acquired	$	17,794

Accounts payable	$	124
Other current liabilites		365
Deferred Tax Liabilities		2,445
Total liabilities assumed	$	2,934

Purchase price	$	14,860

The identifiable intangible assets acquired and their estimated useful lives (based on third party valuations) are as follows (in thousands):

	Fair Value		Estimated Useful Life
Trade name	$	400	Indefinite
Developed technology		6,600	7 Years
Customer relationships		160	7 Years
Non-competition agreements		30	1 Year
	$	7,190

The intangible assets are being amortized on a straight line basis, which is consistent with the pattern that the economic benefits of the intangible assets are expected to be utilized based on the estimated cash flows generated from such assets. The Company recognized approximately $987,000 and $279,000 of amortization expense related to the amortizable intangible assets at December 31, 2015 and 2014, respectively, based on the aforementioned estimates.

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On an unaudited proforma basis, assuming the completed acquisition had occurred as of the beginning of the periods presented, the consolidated results from continuing operations of the Company would have been as follows (in thousands, except per share amounts):

	(Unaudited) Year ended December 31, 2014
Revenues	$	219,328
Net loss	$	(559	)

Earnings per share:
Basic	$	(0.04	)
Diluted	$	(0.04	)

The unaudited proforma financial information presented above gives effect to purchase accounting adjustments which have resulted or are expected to result from the acquisition. This proforma information is not necessarily indicative of the results that would actually have been obtained had the companies combined for the periods presents.

The Company has recognized transaction, integration, and other acquisition related costs of approximately $163,000 through December 31, 2014, which have been recorded within sales, general, and administration expense within the Company’s consolidated statements of operations. Additionally, the results of the Brink acquisition acquired in 2014 contributed $832,000 to PAR’s revenue and reduced PAR’s net income from continuing operations by $145,000 in 2014. The results of operations of the Brink acquisition is reported in the Company’s consolidated results of operations of the Company from the date of acquisition.

Note 3 — Divestiture and Discontinued Operations

On November 4, 2015, ParTech, Inc. (“PTI”), a wholly owned subsidiary of PAR Technology Corporation, PAR Springer-Miller Systems, Inc. (“PSMS”), Springer-Miller International, LLC (“SMI”), and Springer-Miller Canada, ULC (“SMC”) (PTI, PSMS, SMI and SMC are collectively referred to herein as the “Group”), entered into an asset purchase agreement (the “APA”) with Gary Jonas Computing Ltd., SMS Software Holdings LLC, and Jonas Computing (UK) Ltd. (the “Purchasers”), each of which is an affiliate of the Jonas Software Group of Constellation Software Inc. of Toronto, Ontario, for the sale of substantially all of the assets of PSMS. Total consideration to be received from the sale is $16.6 million in cash (the “Base Purchase Price”), with $12.1 million received at the time of closing, and $4.5 million receivable eighteen months after the closing date, a portion of which amount will be available to pay certain indemnification obligations of the group.The estimated fair value of the remaining portion of the note receivable, less any estimated working capital adjustments, due on May 4, 2017 is approximately $3.3 million and is included within noncurrent assets in PAR’s consolidated balance sheets.

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In addition to the base purchase price, contingent consideration of up to $1,500,000 is receivable by PAR based on achievement of certain agreed-upon revenue and earnings targets for calendar years 2016 through 2018, as set forth in the APA. As of December 31, 2015, the Company has not recorded any amount associated with this contingent consideration as it does not believe achievement of the related targets is probable.

Summarized financial information for the Company’s discontinued operations is as follows (in thousands):

	December 31, 2015		December 31, 2014
Assets
Cash	$	-	$	300
Accounts receivable - net		-		1,771
Other current assets		-		574
Property, plant and equipment - net		-		986
Goodwill		-		6,116
Intangible assets - net		-		12,372
Assets of discontinued operation	$	-	$	22,119

Liabilities
Accounts Payable	$	-	$	417
Accrued salaries and benefits		441		703
Accrued expenses		-		87
Customer Deposits		-		1,103
Deferred service revenue		-		2,307
Liabilities of discontinued operation	$	441	$	4,617

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Summarized financial information for the Company’s discontinued operations is as follows (in thousands):

	December 31,
	2015			2014

Total revenues	$	14,545		$	15,746

Loss from discontinued operations before income taxes	$	(5,702	)	$	(5,816	)
Loss on disposition		(2,408	)		-
Benefit from income taxes		3,198			2,094
Loss from discontinued operations, net of taxes	$	(4,912	)	$	(3,722	)

Note 4 — Accounts Receivable, net

The Company’s net accounts receivable consist of, excluding discontinued operations:

	December 31, (in thousands)
	2015			2014
Government segment:
Billed	$	9,400		$	9,340
Advanced billings		(1,266	)		(450	)
		8,134			8,890
Hospitality segment:
Accounts receivable - net		21,396			20,784
	$	29,530		$	29,674

At December 31, 2015,2014 and 2013, the Company had recorded allowances for doubtful accounts of $875, 000, $484,000 and $422,000, respectively, against hospitality segment accounts receivable. Write-offs of accounts receivable during fiscal years 2015 and 2014 were $382,000 and $278,000, respectively. The provision for doubtful accounts recorded in the consolidated statements of operations was $772,000 and $340,000 in 2015 and 2014, respectively.

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Note 5 — Inventories, net

Inventories are used in the manufacture and service of hospitality products. The components of inventory, net consist of the following, excluding discontinued operations:

	December 31, (in thousands)
	2015		2014
Finished Goods	$	8,775	$	13,615
Work in process		402		457
Component parts		5,068		3,748
Service parts		7,254		8,108
	$	21,499	$	25,928

December 31, 2015 and December 31, 2014, the Company had recorded inventory reserves of $8.6 million and $7.9 million, respectively, against Hospitality inventories, which relates primarily to service parts.

Note 6 — Property, Plant and Equipment

The components of property, plant and equipment, excluding discontinued operations, are:

	December 31, (in thousands)
	2015			2014
Land	$	253		$	253
Building and improvements		5,645			5,645
Rental property		5,330			5,308
Furniture and equipment		11,804			10,160
		23,032			21,366
Less accumulated depreciation		(17,316	)		(16,218	)
	$	5,716		$	5,148

The estimated useful lives of buildings and improvements and rental property are twenty to twenty-five years. The estimated useful lives of furniture and equipment range from three to eight years. Depreciation expense from continuing operations was $1,137,000 and $1,052,000 for 2015 and 2014, respectively.

The Company leases a portion of its headquarters facility to various tenants. Net rent received from these leases totaled $264,000 and $359,000 for 2015 and 2014, respectively. Future minimum rent payments due to the Company under these lease arrangements are approximately $306,000, $246,000 and $57,000 in 2016, 2017 and 2018, respectively.

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The Company leases office space under various operating leases. Rental expense from continuing operations on operating leases was approximately $1.4 million and $1.3 million for 2015 and 2014, respectively. Future minimum lease payments under all non-cancelable operating leases are (in thousands):

2016		1,466
2017		1,149
2018		924
2019		860
2020		336
Thereafter		738
	$	5,473

Note 7 — Debt

Through June 4, 2014, the Company maintained a credit facility with J.P. Morgan Chase, N.A. and NBT Bank, N.A. (on behalf of itself and as successor by merger to Alliance Bank, N.A.) consisting of $20.0 million in working capital lines of credit (with the option to increase to $30.0 million), which expired in June 2014. This agreement allowed the Company, at its option, to borrow funds at the LIBOR rate plus the applicable interest rate spread or at the bank's prime lending rate. This credit facility was secured by certain assets of the Company.

On June 5, 2014, the Company executed an amendment to its then existing credit facility to provide for the renewal of the facility through June 2017, with terms generally consistent to those of its prior facility. This facility provided the Company with capital of up to $20.0 million (with the option to increase to $30.0 million) in the form of a revolving line of credit. This agreement allowed the Company, at its option, to borrow funds at the LIBOR rate plus the applicable interest rate spread or at the bank's prime lending rate.

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On September 9, 2014, the Company terminated its existing credit facilities with J.P. Morgan Chase, N.A. and NBT Bank, N.A. (on behalf of itself and as successor by merger to Alliance Bank, N.A.) consisting of $20.0 million in working capital lines of credit, and the Company and its domestic subsidiaries entered into a new three-year credit facility with J.P. Morgan Chase, N.A (the Credit Facility). The terms of the Credit Facility provide for up to $25 million of a line of credit, with borrowing availability based on a percentage of value of various assets of the Company and its subsidiaries. The new agreement bears interest at the applicable bank rate (3.25% at December 31, 2015) or, at the Company's option, at the LIBOR rate plus the applicable interest rate spread (range of 1.5% – 2.0%). At December 31, 2015, the Company did not have any outstanding balance on this line of credit. The weighted average interest rate paid by the Company was approximately 3.50% during fiscal year 2015. The new agreement contains traditional asset based loan covenants and includes covenants regarding earnings before interest, tax, depreciation & amortization (“EBITDA”) and a fixed charge coverage ratio, and provides for acceleration upon the occurrence of customary events of defaults.

On March 19, 2015, the Company amended the Credit Facility to reduce the EBITDA requirement and extend the fixed charge coverage ratio. The amendment provides the Company flexibility to continue investing in the Company’s future product offerings while maintaining certain covenant thresholds as defined in the amendment. On March 16, 2016, the Company received a notice of defaults under its current Credit Facility due to unauthorized investments made during 2015 by the company’s former Chief Financial Officer, which were not permitted investments as defined in the lending agreement. See Note 1, “Summary of Significant Accounting Policies,” to the Consolidated Financial Statements for further discussion on these unauthorized investments. These unauthorized investments involved cash transfers totaling $776,000, which amounts have been written off by the Company as of December 31, 2015 (the “Unauthorized Transactions”). On March 24, 2016 the lender provided waivers of the defaults, subject to certain terms and conditions contained in the waiver, including entry by the Company into a fourth amendment to the Company’s Credit Agreement.

On March 24, 2016, based on the waiver received, the Company executed the fourth amendment to its existing Credit Agreement. Under the terms and conditions of this amendment, the Company has undertaken to engage, and has engaged, an independent consultant to review its internal controls relating to financial reporting and authorization procedures for financial transactions (including, without limitation, investments) initiated by the Company’s officers (the “Internal Control Review”). The company has agreed to deliver to the lender a report prepared by Company’s consultant that sets forth, in reasonable detail, the results of the Internal Control Review, together with a summary of any recommended changes to the Company’s internal control procedures (the “ICR Report”). To the extent the ICR Report sets forth recommended changes to Borrowers’ internal control procedures (“IC Recommendations”), The Company has agreed to promptly take steps to implement the IC Recommendations in all material respects. The Company has agreed to provide periodic updates to the lender relating to the Internal Control Review, implementation of IC Recommendations and any ongoing investigations related to the Unauthorized Transactions

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In addition to the credit facility described above, the Company has a mortgage loan, collateralized by certain real estate, with a balance of $746,000 and $919,000 at December 31, 2015 and 2014, respectively. This mortgage matures on November 1, 2019. The Company's fixed interest rate was 4.05% through October 1, 2014. Beginning on October 1, 2014, the fixed rate was converted to a new rate equal to the then-current five year fixed advanced rate charged by the New York Federal Home Loan bank, plus 225 basis points. Effective November 1, 2014, the Company entered into an agreement that fixed the interest rate at 4.00% through the maturity date of the loan. The annual mortgage payment including interest through November 1, 2019 totals $206,000.

In connection with the acquisition of Brink Software on September 18, 2014, the Company recorded indebtedness to the former owners of Brink under the stock purchase agreement. At December 31, 2015 and 2014, the principal balance of the note payable was $2.0 million and $5.0 million and it had a carrying value of $1.9 million and $4.8 million, respectively. The carrying value was based on the note’s estimated fair value at the time of acquisition. The note does not bear interest and repayment terms are $3.0 million, which was paid on the first anniversary of close, September 18, 2015, and $2.0 million payable on the second anniversary of close, September 18, 2016.

The Company’s future principal payments under the stock purchase agreement and its mortgage are as follows (in thousands):

2016	$	2,103
2017		188
2018		195
2019		183
	$	2,669

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Note 8 — Stock Based Compensation

The Company recognizes all stock-based compensation to employees and directors, including grants of employee stock options and restricted stock awards, in the financial statements as compensation cost over the vesting period based on their fair value on the date of grant. Total stock-based compensation expense included in selling, general and administrative expense in 2015 and 2014 was $487,000 and $1,185,000, respectively. The amount recorded for the twelve months ended December 31, 2015 and 2014 was recorded net of benefits of $197,000 and $114,000, as the result of forfeitures of unvested stock awards prior to the completion of the requisite service period. The amount of total stock based compensation includes $182,000 and $608,000 in 2015 and 2014, respectively, relating to restricted stock awards. No compensation expense has been capitalized during 2015 and 2014.

The Company has reserved 1,000,000 shares under its 2015 Equity Incentive Plan (“EIP”). Stock options under this Plan may be incentive stock options or nonqualified stock options. The Plan also provides for restricted stock awards, including performance based awards. Stock options are nontransferable other than upon death. Option grants generally vest over a one to five year period after the grant and typically expire ten years after the date of the grant. The EIP provides for the grant of several different forms of stock-based compensation, including stock options to purchase shares of PAR common stock. The Compensation Committee of the Board of Directors (Compensation Committee) has discretion to determine the material terms and conditions of option awards under the EIP, provided that (i) the exercise price must be no less than the fair market value of PAR common stock (defined as the closing price) on the date of grant, (ii) the term must be no longer than ten years, and (iii) in no event shall the normal vesting schedule provide for vesting in less than one year. Other terms and conditions of an award of stock options will be determined by the Compensation Committee as set forth in the agreement relating to that award. The Compensation Committee has authority to administer the EIP.

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Information with respect to stock options included within this plan is as follows:

	No. of Shares (in thousands)			Weighted Average Exercise Price		Aggregate Intrinsic Value (in thousands)

Outstanding at December 31, 2014		1,240		$	5.28	$	1,264
Options granted		118			4.90
Options exercised		(94	)		5.04
Forfeited and cancelled		(211	)		5.09
Expired		(120	)		6.50
Outstanding at December 31, 2015		933		$	5.14	$	1,579
Vested and expected to vest at December 31, 2015		905		$	5.14	$	1,532
Total shares exercisable as of December 31, 2015		302		$	5.14	$	512
Shares remaining available for grant		1,000

The weighted average grant date fair value of options granted during the years 2015 and 2014 was $1.44 and $1.68, respectively. The total intrinsic value of options exercised during the year ended December 31, 2015 was $119,000. There were no options exercised during the year ended December 31, 2014. New shares of the Company’s common stock are issued as a result of stock option exercises in 2015. The fair value of options at the date of the grant was estimated using the Black-Scholes model with the following assumptions for the respective period ending December 31:

	2015			2014

Expected option life	5.1 years			5.9 years
Weighted average risk-free interest rate		1.6	%		1.7	%
Weighted average expected volatility		30	%		31	%
Expected dividend yield		0	%		0	%

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For the years ended December 31, 2015 and 2014, the expected option life was based on the Company’s historical experience with similar type options. Expected volatility is based on historical volatility levels of the Company’s common stock over the preceding period of time consistent with the expected life. The risk-free interest rate is based on the implied yield currently available on U.S. Treasury zero coupon issues with a remaining term equal to the expected life. Stock options outstanding at December 31, 2015 are summarized as follows:

Range of Exercise Prices		Number Outstanding (in thousands)		Weighted Average Remaining Life	Weighted Average Exercise Price

$	4.31 - $6.47		933	8.10 years	$	5.14

At December 31, 2015 the aggregate unrecognized compensation cost of unvested equity awards, as determined using a Black-Scholes option valuation model, was $758,000 (net of estimated forfeitures) which is expected to be recognized as compensation expense in fiscal years 2016 through 2018. The Company has not paid cash dividends on its common stock, and the Company presently intends to continue to retain earnings for reinvestment in growth opportunities. Accordingly, it is anticipated no cash dividends will be paid in the foreseeable future.

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Current year activity with respect to the Company’s non-vested restricted stock awards is as follows:

Non-vested restricted stock awards (in thousands)	Shares			Weighted Average grant- date fair value

Balance at January 1, 2015		273		$	4.68
Granted		34			4.67
Vested		(110	)		4.71
Forfeited and cancelled		(112	)		3.95
Balance at December 31, 2015		85		$	5.13

The EIP also provides for the issuance of restricted stock, as well as restricted stock units. These types of awards can have either service based or performance based vesting with performance goals being established by the Compensation Committee. Grants of restricted stock with service based vesting are subject to vesting periods ranging from zero to 60 months. Grants of restricted stock with performance based vesting are subject to a vesting period of 12 to 36 months and performance conditions as defined by the Compensation Committee. The Company assesses the likelihood of achievement throughout the performance period and recognizes compensation expense associated with its performance awards based on this assessment. Other terms and conditions applicable to any award of restricted stock will be determined by the Compensation Committee and set forth in the agreement relating to that award.

During 2015 and 2014, the Company issued 34,000 and 170,000 restricted stock awards, respectively, at a per share price of $0.02. Included within the equity grants of 2014 were approximately 109,000 performance based restricted stock awards which vest upon the achievement of business unit and consolidated financial goals relative to fiscal years 2014 through 2016. These equity awards are forfeited if the performance conditions are not achieved for each fiscal year. For the periods ended December 31, 2015 and 2014, the Company recognized compensation expense related to the performance awards based on its estimate of the probability of achievement in accordance with ASC Topic 718.

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The fair value of restricted stock awards is based on the average price of the Company’s common stock on the date of grant. The weighted average grant date fair value of restricted stock awards granted during the years 2015 and 2014 was $4.67 and $5.24, respectively. In accordance with the terms of the restricted stock award agreements, the Company released 110,000 and 112,000 shares during 2015 and 2014, respectively. During 2015, there were 112,000 shares of restricted stock cancelled, of which 102,000 were performance based restricted shares. During 2014, there were 62,000 shares of restricted stock cancelled, of which 52,000 were performance based restricted shares.

Note 9— Income Taxes

The provision for income taxes from continuing operations consists of:

	Year ended December 31, (in thousands)
	2015		2014

Current income tax:
Federal	$	221	$	115
State		141		212
Foreign		267		757
		629		1,084
Deferred income tax:
Federal		816		2,238
State		55		372
		871		2,610
Provision for income taxes	$	1,500	$	3,694

The deferred tax benefit related to discontinued operations was $3.2 million in fiscal year 2015 and $2.1 million recorded in fiscal year 2014.

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Deferred tax liabilities (assets) are comprised of the following at:

	December 31, (in thousands)
	2015			2014
Deferred tax liabilities:
Software development costs	$	1,841		$	4,984
Acquired intangible assets		2,088			2,350
Gross deferred tax liabilities		3,929			7,334

Allowances for bad debts and inventory		(4,804	)		(4,524	)
Capitalized inventory costs		(75	)		(114	)
Intangible assets		(1,747	)		(2,100	)
Employee benefit accruals		(2,050	)		(1,715	)
Federal net operating loss carryforward		(6,215	)		(9,249	)
State net operating loss carryforward		(1,111	)		(1,104	)
Tax credit carryforwards		(8,760	)		(7,809	)
Foreign currency		(33	)		(33	)
Other		(334	)		(502	)
Gross deferred tax assets		(25,129	)		(27,150	)

Less valuation allowance		3,421			3,947

Net deferred tax assets	$	(17,779	)	$	(15,869	)

The Company has Federal tax credit carryforwards of $8.7 million that expire in various tax years from 2016 to 2035. The Company has a Federal operating loss carryforward of $19.9 million that expires in various tax years through 2035. Of the operating loss carryforward, $1.6 million will result in a benefit within additional paid in capital when realized. The Company also has state tax credit carryforwards of $210,000 and state net operating loss carryforwards of $8.0 million that expire in various tax years through 2034. In assessing the ability to realize deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which the temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. As a result of this analysis and based on the current year’s taxable income, and utilization of certain carryforwards management determined that it should reduce it valuation allowance in the current year. A valuation allowance is still required to the extent it is more likely than not that the future benefit associated with the foreign tax credit carryforwards and certain state tax loss carryforwards will not be realized. As a result, the Company recorded a tax benefit associated with a reduction of the deferred tax asset valuation allowance of $0.5 million for 2015. The Company recorded tax expense in 2015 associated with an increase in the valuation allowance in 2014 in the amount of $1.6 million for 2014.

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The Company records the benefits relating to uncertain tax positions only when it is more likely than not (likelihood of greater than 50%), based on technical merits, that the position would be sustained upon examination by taxing authorities. Tax positions that meet the more likely than not threshold are measured using a probability-weighted approach as the largest amount of tax benefit that is greater than 50% likely of being realized upon settlement. At December 31, 2015, the Company’s reserve for uncertain tax positions is not material and the Company believes it has adequately provided for its tax-related liabilities. The Company is no longer subject to United States federal income tax examinations for years before 2012. The provision for (benefit from) income taxes differed from the provision computed by applying the Federal statutory rate to income (loss) from continuing operations before taxes due to the following:

	2015			2014
Federal statutory tax rate		34.0	%		34.0	%
State taxes		5.8			11.5
Non deductible expenses		1.0			4.6
Tax credits		(4.8	)		(11.7	)
Repatriation of foreign earnings		0.0			59.8
Foreign income tax rate differential		(1.3	)		(43.2	)
Valuation allowance		(9.5	)		41.7
Tax return and audit adjustments		3.8			0.0
Other		(1.8	)		1.4
		27.2	%		98.1	%

Note 10 — Employee Benefit Plans

The Company has a deferred profit-sharing retirement plan that covers substantially all employees. The Company’s annual contribution to the plan is discretionary. The Company’s did not make a contribution in 2015 or 2014. The plan also contains a 401(k) provision that allows employees to contribute a percentage of their salary up to the statutory limitation. These contributions are matched at the rate of 10% by the Company. The Company’s matching contributions under the 401(k) component were $359,000 and $318,000 in 2015 and 2014, respectively.

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The Company also maintains an incentive-compensation plan. Participants in the plan are key employees as determined by the Board of Directors and executive management. Compensation under the plan is based on the achievement of predetermined financial performance goals of the Company and its subsidiaries. Awards under the plan are payable in cash. Awards under the plan totaled $776,000 and $656,000, in 2015 and 2014, respectively.

The Company also sponsors a deferred compensation plan for a select group of highly compensated employees. Participants may make elective deferrals of their salary to the plan in excess of tax code limitations that apply to the Company’s qualified plan. The Company invests the participants’ deferred amounts to fund these obligations. The Company also has the sole discretion to make employer contributions to the plan on behalf of the participants, though it did not make any employer contributions in 2015 or 2014.

Note 11 — Contingencies

The Company is subject to legal proceedings, which arise in the ordinary course of business. Additionally, U.S. Government contract costs are subject to periodic audit and adjustment. In the opinion of management, the ultimate liability, if any, with respect to these actions will not materially affect the financial position, results of operations, or cash flows of the Company.

Note 12 — Segment and Related Information

The Company is organized in three reporting units: restaurant/retail, hotel/spa, and government. The Company has identified government as a separate reportable segment and has aggregated its two restaurant/retail/hotel/spa reporting units into one reportable segment, hospitality, as the reporting units share many similar economical characteristics. Management views the government and hospitality segments separately in operating its business, as the products and services are different for each segment. The Company’s chief operating decision maker is the Company’s Chief Executive Officer. The hotel/spa reporting has been sold as of November 4, 2015 and is included within discontinued operations (see note 3).

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The Company has two reportable business segments, hospitality and government. The hospitality segment offers integrated solutions to the hospitality industry consisting of restaurants, grocery stores and specialty retail outlets. These offerings include industry leading hardware and software applications utilized at the point-of-sale, back of store and corporate office and includes the acquisition of Brink Software. This segment also offers customer support including field service, installation, and twenty-four hour telephone support and depot repair. The government segment performs complex technical studies, analysis, and experiments, develops innovative solutions, and provides on-site engineering in support of advanced defense, security, and aerospace systems. This segment also provides expert on-site services for operating and maintaining U.S. Government-owned communication assets.

Information noted as “Other” primarily relates to the Company’s corporate, home office operations.

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Information as to the Company’s segments is set forth below. Amounts below exclude discontinued operations.

	Year ended December 31, (in thousands)
	2015			2014
Revenues:
Hospitality	$	141,151		$	130,174
Government		87,852			87,689
Total	$	229,003		$	217,863

Operating income (loss) :
Hospitality	$	1,721		$	323
Government		5,365			4,883
Other		(457	)		(1,790	)
		6,629			3,416
Other income, net		(800	)		485
Interest expense		(308	)		(136	)
Income from continuing operations before provision for income taxes	$	5,521		$	3,765

Identifiable assets:
Hospitality	$	72,948		$	81,269
Government		10,052			11,221
Other		32,312			22,688
Total	$	115,312		$	115,178

Goodwill:
Hospitality	$	10,315		$	10,315
Government		736			736
Total	$	11,051		$	11,051

Depreciation, amortization and accretion:
Hospitality	$	2,673		$	1,678
Government		48			50
Other		349			279
Total	$	3,070		$	2,007

Capital expenditures including software costs:
Hospitality	$	3,645		$	2,181
Government		-			36
Other		208			969
Total	$	3,853		$	3,186

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The following table presents revenues by country based on the location of the use of the product or services. Amounts below exclude discontinued operations.

	December 31,
	2015		2014
United States	$	197,303	$	189,845
Other Countries		31,700		28,018
Total	$	229,003	$	217,863

The following table presents assets by country based on the location of the asset. Amounts below exclude discontinued operations.

	December 31,
	2015		2014
United States	$	100,021	$	93,825
Other Countries		15,291		21,353
Total	$	115,312	$	115,178

Customers comprising 10% or more of the Company's total revenues, excluding discontinued operations, are summarized as follows:

	December 31,
	2015			2014
Hospitality segment:
McDonald’s Corporation		19	%		16	%
Yum! Brands, Inc.		10	%		12	%
Government segment:
U.S. Department of Defense		38	%		40	%
All Others		33	%		32	%
		100	%		100	%

No other customer within All Others represented more than 10% of the Company’s total revenue for the years ended December 31, 2015 and 2014.

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Note 13 — Fair Value of Financial Instruments

The Company’s financial instruments have been recorded at fair value using available market information and valuation techniques. The fair value hierarchy is based upon three levels of input, which are:

Level 1 − quoted prices in active markets for identical assets or liabilities (observable)

Level 2 − inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in inactive markets, or other inputs that are observable market data for essentially the full term of the asset or liability (observable)

Level 3 − unobservable inputs that are supported by little or no market activity, but are significant to determining the fair value of the asset or liability (unobservable)

The Company’s financial instruments consist primarily of cash and cash equivalents, trade receivables, trade payables, debt instruments and deferred compensation assets and liabilities. For cash and cash equivalents, trade receivables and trade payables, the carrying amounts of these financial instruments as of December 31, 2015 and 2014 were considered representative of their fair values. The estimated fair value of the Company’s long-term debt and line of credit at December 31, 2015 and 2014 was based on variable and fixed interest rates at December 31, 2015 and 2014, respectively, for new issues with similar remaining maturities and approximates the respective carrying values at December 31, 2015 and 2014.

The deferred compensation assets and liabilities primarily relate to the Company’s deferred compensation plan, which allows for pre-tax salary deferrals for certain key employees (see note 10). Changes in the fair value of the deferred compensation liabilities are derived using quoted prices in active markets of the asset selections made by the participants. The deferred compensation liabilities are classified within Level 2, as defined under U.S. GAAP, because their inputs are derived principally from observable market data by correlation to the hypothetical investments. The Company holds insurance investments to partially offset the Company’s liabilities under the deferred compensation plan, which are recorded at fair value each period using the cash surrender value of the insurance investments.

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The Company has obligations, to be paid in cash, to the former owners of Brink Software, based on the achievement of certain conditions as defined in the definitive agreement (see note 2). The fair value of this contingent consideration payable was estimated using a discounted cash flow method, with significant inputs that are not observable in the market and thus represents a Level 3 fair value measurement as defined in ASC 820, fair value measurements and disclosures. The significant inputs in the Level 3 measurement not supported by market activity included the Company’s probability assessments of expected future cash flows related to the Company’s acquisition of Brink during the contingent consideration period, appropriately discounted considering the uncertainties associated with the obligation, and calculated in accordance with the terms of the definitive agreement. The liabilities for the contingent consideration were established at the time of the acquisition and are evaluated on a quarterly basis based on additional information as it becomes available. Any change in the fair value adjustment is recorded in the earnings of that period. Changes in the fair value of the contingent consideration obligations may result from changes in probability assumptions with respect to the likelihood of achieving the various contingent payment obligations.Significant increases or decreases in the inputs noted above in isolation would result in a significantly lower or higher fair value measurement.

The following table presents a summary of changes in fair value of the Company’s Level 3 assets and liabilities that are measured at fair value on a recurring basis (in thousands):

	Level 3 Inputs
	Liabilities
Balance at December 31, 2014	$	5,040
New level 3 liability		-
Change in fair value of contingent consideration liability		90
Transfers into or out of Level 3		-
Balance at December 31, 2015	$	5,130

Note 14 — Related Party Transactions

The Company leases its corporate wellness facility to related parties at a current rate of $9,775 per month. The Company receives a complimentary membership to this facility which is provided to all employees. During 2015 and 2014 the Company received rental income amounting to $117,300 for the lease of the facility in each year.

Note 15 — Subsequent Events

On March 24, 2016, the Company amended its credit facility with J.P. Morgan Chase, N.A. See Note 7 for further details.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	PAR TECHNOLOGY CORPORATION

March 30, 2016	/s/ Karen E. Sammon
	Karen E. Sammon
	Chief Executive Officer & President

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signatures	Title	Date

/s/ Karen E. Sammon
Karen E. Sammon	Chief Executive Officer & President	March 30, 2016

/s/ Cynthia A. Russo
Cynthia A. Russo	Director	March 30, 2016

/s/ Paul D. Eurek
Paul D. Eurek	Director	March 30, 2016

/s/ Todd E. Tyler
Todd E. Tyler	Director	March 30, 2016

/s/ John W. Sammon
John W. Sammon	Director	March 30, 2016

/s/ Ronald J. Casciano
Ronald J. Casciano	Director	March 30, 2016

/s/ Donald H. Foley
Donald H. Foley	Director	March 30, 2016

/s/ Matthew J. Trinkaus
Matthew J. Trinkaus	Controller and Chief Accounting Officer	March 30, 2016

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List of Exhibits

Exhibit No.	Description of Instrument

3.(i)	Certificate of Incorporation, as amended May 22, 2014.	Filed as Exhibit 3(i) to Form 8-K filed May 29, 2014 of PAR Technology Corporation and incorporated herein by reference.

3.(ii)	By-laws, as amended May 22, 2014.	Filed as Exhibit 3.(ii) to Form 8-K filed May 29, 2014 of PAR Technology Corporation incorporated herein by reference.

4	Specimen Certificate representing the Common Stock.	Filed as Exhibit 4 to Registration Statement on Form S-2 (Registration No. 333-04077) of PAR Technology Corporation incorporated herein by reference.

10.1	Letter of Agreement with Sanmina– SCI Corporation.	Filed as Exhibit 10.1 to Form S-3/A (Registration No. 333-102197) of PAR Technology Corporation incorporated herein by reference.

10.2	2005 Equity Incentive Plan of PAR Technology Corporation.	Filed as Exhibit 4.2 to Form S-8 (Registration No. 333-137647) of PAR Technology Corporation and incorporated herein by reference.

10.3	2005 Equity Incentive Plan, as amended.	Filed as Exhibit 4.1 to Registration Statement on Form S-8 (Registration No. 333-187246) of PAR Technology Corporation incorporated herein by reference.

10.4	Form of Restricted Stock Award Agreement Pursuant to the 2005 Equity Incentive Plan.	Filed as Exhibit 10.1 to Form 10-Q as for the quarter ended June 30, 2013 and incorporated by reference.
10.5	Pledge and Security Agreement with JP Morgan Chase.	Filed as Exhibit 10.2 to Form 8-K dated June 16, 2008 of PAR Technology Corporation and incorporated herein by reference.

10.6	June 2011 – Amended and Restated Credit Agreement with JPMorgan Chase Bank, N.A; NBT Bank, N.A.; Alliance Bank, N.A.	Filed as an Exhibit 10.1 to Form 8-K dated June 6, 2011 of PAR Technology Corporation and incorporated herein by reference.

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List of Exhibits (Continued)

Exhibit No.	Description of Instrument

10.7	June 2011 - Amendment No. 1 to Pledge and Security Agreement with JPMorgan Chase Bank, N.A.	Filed as an Exhibit 10.2 to Form 8-K dated June 6, 2011 of PAR Technology Corporation and incorporated herein by reference.

10.8***	December 2011 - Asset Purchase and Sale Agreement by and between PAR Technology Corporation, PAR Government Systems Corporation, PAR Logistics Management Systems Corporation and ORBCOMM Inc. and PLMS Acquisition, LLC.	Filed as an Exhibit 10.13 to Form 10-K dated April 4, 2012 of PAR Technology Corporation and incorporated herein by reference.

10.9	February 2013 - Amendment No. 2 to Pledge and Security Agreement with JPMorgan Chase Bank, N.A.	Filed as an Exhibit 10.14 to Form 10-K dated March 13, 2013 of PAR Technology Corporation and incorporated herein by reference.

10.10	Employment Offer Letter dated March 21, 2013 between Registrant and Ronald J. Casciano.	Filed as an Exhibit 10.1*+ to Form 10-Q for the quarter ended March 31, 2013 and incorporated herein by reference.

10.11	Employment Offer Letter dated March 21, 2013 between Registrant and Robert P. Jerabeck.	Filed as an Exhibit 10.2*+ to Form 10-Q for the quarter ended March 31, 2013 and incorporated herein by reference.

10.12	Employment Offer Letter dated March 21, 2013 between Registrant and Karen E. Sammon.	Filed as an Exhibit 10.3*+ to Form 10-Q for the quarter ended March 31, 2013 and incorporated herein by reference.

10.13	Form of Notice of Equity Award and Agreement Pursuant to the 2005 Equity Incentive Plan.	Filed as an Exhibit 10.17 to Form 10-K dated March 14, 2014 of Par Technology Corporation and incorporated herein by reference.

10.14	June 2014 – Amendment No. 3 to Pledge and Security Agreement with JPMorgan Chase Bank, N.A.	Filed as an Exhibit 10.1 to Form 10-Q for the quarter ended June 30, 2014 and incorporated herein by reference.

10.15 ***	Credit Agreement with JPMorgan Chase Bank, N.A. dated as of September 9, 2014.	Filed as an Exhibit 10.1 to Form 10-Q for the quarter ended September 30, 2014 and incorporated herein by reference.

10.16	Pledge and Security Agreement with JPMorgan Chase Bank, N.A. dated as of September 9, 2014.	Filed as an Exhibit 10.2 to Form 10-Q for the quarter ended September 30, 2014 and incorporated herein by reference.

Table of Contents

List of Exhibits (Continued)

Exhibit No.	Description of Instrument

10.17 ***	Stock Purchase Agreement by and among Brink Software, Inc., the Shareholders, ParTech, Inc., and PAR Technology Corporation dated as of September 18, 2014.	Filed as an Exhibit 10.3 to Form 10-Q for the quarter ended September 30, 2014 and incorporated herein by reference.

10.18	Form of Outside Director Notice of Restricted Stock Award and Agreement Pursuant to the 2005 Equity Incentive Plan.	Filed as an Exhibit 10.21 to Form 10-K dated March 31, 2015 of Par Technology Corporation and incorporated herein by reference.

10.19	Form of Notice of Award and Agreement Pursuant to the 2005 Equity Incentive Plan.	Filed as an Exhibit 10.23 to Form 10-K dated March 31, 2015 of Par Technology Corporation and incorporated herein by reference.

10.20 ***	Second Amendment to Credit Agreement and Other Loan Documents with JPMorgan Chase Bank, N.A. dated as of March 19, 2015	Filed as an Exhibit 10.24 to Form 10-K dated March 31, 2015 of Par Technology Corporation and incorporated herein by reference

10.21	Separation Agreement between PAR Technology Corporation and Stephen P. Lynch dated August 31, 2015.	Filed as an Exhibit 10.1 to Form 10-Q for the quarter ended September 30, 2015 and incorporated herein by reference.

10.22	2015 Equity Incentive Plan of PAR Technology Corporation.	Filed as Exhibit 4.2 to Form S-8 (Registration No. 333-208063) of PAR Technology Corporation and incorporated herein by reference.

10.23	Form of Notice of Award Pursuant to the 2015 Equity Incentive Plan	Filed as Exhibit 4.3 to Form S-8 (Registration No. 333-208063) of PAR Technology Corporation and incorporated herein by reference.

10.24	Form of Outside Director Notice of Restricted Stock Award and Agreement Pursuant to the 2015 Equity Incentive Plan	Filed as Exhibit 4.4 to Form S-8 (Registration No. 333-208063) of PAR Technology Corporation and incorporated herein by reference.

10.25	Employment Offer Letter dated July 13, 2015 between Registrant and Michael Bartusek

10.26	November 2015 – Asset Purchase Agreement by and among Gary Jonas Computing Ltd., SMS Software Holdings LLC, Jonas Computing (UK) Ltd., PAR Springer-Miller Systems, Inc., Springer-Miller International, LLC, Springer-Miller Canada, ULC, ParTech, Inc., and Constellation Software Inc.

10.27	Employment Offer Letter dated November 16, 2015 between Registrant and Karen Sammon

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List of Exhibits (Continued)

Exhibit No.	Description of Instrument

10.28	Employment Offer Letter dated December 10, 2015 between Registrant and Matthew Cicchinelli

10.29	Fourth Amendment to Credit Agreement with JPMorgan Chase Bank, N.A. dated as of March 24, 2016

22	Subsidiaries of the registrant.

23.1	Consent of Independent Registered Public Accounting Firm.

31.1	Certification of Chief Executive Officer & President Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2	Certification of Controller and Chief Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1	Certification of Chief Executive Officer & President Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2	Certification of Controller and Chief Accounting Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

***	Portions of this Exhibit were omitted pursuant to a request for confidential treatment. The omitted portions have been separately filed with the Securities and Exchange Commission.

Delaware		16-1434688
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

PAR Technology Park
8383 Seneca Turnpike
New Hartford, New York		13413-4991
(Address of principal executive offices)		(Zip Code)

Title of Each Class		Name of Each Exchange on Which Registered
Common Stock, $.02 par value		New York Stock Exchange

Large Accelerated Filer £	Accelerated Filer £	Non Accelerated Filer £	Smaller reporting company S
		(Do not check if a smaller reporting company)

Location	Industry Segment	Floor Area Principal Operations	Number of Sq. Ft.

New Hartford, NY	Hospitality	Principal executive offices, manufacturing, research and development laboratories, sales, service, wellness, and computing facilities	216,800
Rome, NY	Government	Research and development	30,800

Sydney, Australia	Hospitality	Sales and service	14,400
Boca Raton, FL	Hospitality	Research and development	11,470
Markham, Ontario	Hospitality	Research and development	11,100
Boulder, CO	Hospitality	Service	10,700

Item Number		Page

	PART I
Item 1.	Business	2
Item 1A.	Risk Factors	17
Item 1B.	Unresolved Staff Comments	25
Item 2.	Properties	25
Item 3.	Legal Proceedings	26
Item 4.	Mine Safety Disclosures	26

	PART II
Item 5.	Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	26
Item 6.	Selected Financial Data	26
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	45
Item 8.	Financial Statements and Supplementary Data	46
Item 9.	Changes in and Disagreements With Accounting and Financial Disclosure	46
Item 9A.	Controls and Procedures	46

	PART III
Item 10.	Directors, Executive Officers and Corporate Governance	51
Item 11.	Executive Compensation	51
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	51
Item 13.	Certain Relationships and Related Transactions, and Director Independence	51
Item 14.	Principal Accounting Fees and Services	51

	PART IV
Item 15.	Exhibits, Financial Statement Schedules	52
Item 16.	Signatures	95

	2015				2014
Period	Low		High		Low		High

First quarter	$	4.03	$	6.04	$	4.65	$	5.50
Second quarter	$	3.80	$	4.98	$	4.12	$	4.99
Third quarter	$	4.11	$	5.29	$	3.78	$	5.24
Fourth quarter	$	5.12	$	7.39	$	4.28	$	6.18

	Total		Less Than 1 Year		1-3 Years		3 - 5 Years		More than 5 Years
Debt obligations	$	2,669	$	2,103	$	383	$	183	$	-
Operating lease		5,462		1,456		2,073		1,195		738
Total	$	8,131	$	3,559	$	2,456	$	1,378	$	738

GARY JONAS COMPUTING LTD.

By:	/s/ Barry Symons
	Name: Barry Symons
	Title: Director

SMS SOFTWARE HOLDINGS LLC

By:	/s/ Barry Symons
	Name: Barry Symons
	Title: Manager

JONAS COMPUTING (UK)LTD

By:	/s/ Barry Symons
	Name: Barry Symons
	Title: Director

PAR SPRINGER-MILLER SYSTEMS,INC.

By:	/s/ Ronald J. Casciano
	Name: Ronald J. Casciano
	Title: Treasurer

SPRINGER-MILLER INTERNATIONAL,LLC.

By:	/s/ Ronald J. Casciano
	Name: Ronald J. Casciano
	Title: Treasurer

SPRINGER-MILLER CANADA,ULC

By:	/s/ Ronald J. Casciano
	Name: Ronald J. Casciano
	Title: Treasurer

PARTECH,INC.

By:	/s/ Ronald J. Casciano
	Name: Ronald J. Casciano
	Title: Treasurer

For purposes of section 7.1 only,
CONSTELLATION SOFTWARE INC.

By:	/s/ Jamal Baksh
	Name: Jamal Baksh
	Title: Chief Financial Officer

	LOAN PARTIES

	PAR TECHNOLOGY CORPORATION

	By:
	Name:
	Title:

	AUSABLE SOLUTIONS, INC.

	By:
	Name:
	Title:

	PAR GOVERNMENT SYSTEMS CORPORATION

	By:
	Name:
	Title:

	PAR SPRINGER-MILLER SYSTEMS, INC.

	By:
	Name:
	Title:

	ROME RESEARCH CORPORATION

	By:
	Name:
	Title:

	SPRINGER-MILLER INTERNATIONAL, LLC

	By:
	Name:
	Title:

	PARTECH, INC.

	By:
	Name:
	Title:

	BRINK SOFTWARE, INC.

	By:
	Name:
	Title:

	SPRINGER-MILLER CANADA, ULC

	By:
	Name:
	Title:

	PAR CANADA, ULC

	By:
	Name:
	Title:

	JPMORGAN CHASE BANK, N.A.

	By:
	Name:	Marie C. Duhamel
	Title:	Authorized Officer

Name	State of Incorporation

ParTech, Inc.	New York

PAR Government Systems Corporation	New York

Ausable Solutions, Inc.	Delaware

Date: March 30, 2016	/s/ Karen E. Sammon
	Karen E. Sammon
	Chief Executive Officer & President

Date: March 30, 2016	/s/Matthew J. Trinkaus
	Matthew J. Trinkaus
	Controller and Chief Accounting Officer

/s/ Matthew J. Trinkaus
Matthew J. Trinkaus
Controller & Chief Accounting Officer
March 30, 2016

Document and Entity Information - USD ($)	12 Months Ended
Document and Entity Information - USD ($)	Dec. 31, 2015	Feb. 29, 2016	Jun. 30, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	PAR TECHNOLOGY CORP
Entity Central Index Key	0000708821
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Smaller Reporting Company
Entity Public Float			$ 0
Entity Common Stock, Shares Outstanding		15,644,729
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	FY
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2015

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 8,024	$ 9,867
Accounts receivable-net	29,530	29,674
Inventories-net	21,499	25,928
Deferred income taxes	6,741	4,512
Other current assets	3,808	4,018
Assets of discontinued operations	0	22,119
Total current assets	69,602	96,118
Property, plant and equipment - net	5,716	5,148
Note receivable	3,320	0
Deferred income taxes	11,038	11,357
Goodwill	11,051	11,051
Intangible assets - net	10,898	10,580
Other assets	3,687	3,043
Total Assets	115,312	137,297
Current liabilities:
Current portion of long-term debt	2,103	3,173
Borrowings under line of credit	0	5,000
Accounts payable	11,729	19,258
Accrued salaries and benefits	5,727	5,726
Accrued expenses	6,705	6,492
Customer deposits	180	1,242
Deferred service revenue	10,639	10,388
Income taxes payable	279	475
Liabilities of discontinued operations	441	0
Total current liabilities	37,803	51,754
Long-term debt	566	2,566
Other long-term liabilities	8,883	8,847
Noncurrent liabilities of discontinued operations	0	4,617
Total liabilities	$ 47,252	$ 67,784
Commitments and Contingencies
Shareholders' Equity:
Preferred stock, $.02 par value, 1,000,000 shares authorized	$ 0	$ 0
Common stock, $.02 par value, 29,000,000 shares authorized; 17,352,198 and 17,274,708 shares issued, 15,644,729 and 15,566,599 outstanding at December 31, 2015 and 2014, respectively	347	346
Capital in excess of par value	45,753	44,854
Retained earnings	30,574	31,465
Accumulated other comprehensive loss	(2,778)	(1,316)
Treasury stock, at cost, 1,708,109 shares	(5,836)	(5,836)
Total shareholders' equity	68,060	69,513
Total Liabilities and Shareholders' Equity	$ 115,312	$ 137,297

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2015	Dec. 31, 2014
Shareholders Equity:
Preferred stock, par value (in dollars per share)	$ 0.02	$ 0.02
Preferred stock, authorized (in shares)	1,000,000	1,000,000
Common stock, par value (in dollars per share)	$ 0.02	$ 0.02
Common stock, authorized (in shares)	29,000,000	29,000,000
Common stock, issued (in shares)	17,352,198	17,274,708
Common stock, outstanding (in shares)	15,644,729	15,566,599
Treasury stock, at cost (in shares)	1,708,109	1,708,109

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Net revenues:
Product	$ 94,397	$ 84,484
Service	46,754	45,690
Contract	87,852	87,689
Revenue, net	229,003	217,863
Costs of sales:
Product	68,192	58,889
Service	32,824	35,011
Contract	81,848	82,347
Cost of goods and services sold	182,864	176,247
Gross margin	46,139	41,616
Operating expenses:
Selling, general and administrative	28,276	28,974
Research and development	10,247	8,947
Amortization of identifiable intangible assets	987	279
Operating expenses	39,510	38,200
Operating income from continuing operations	6,629	3,416
Other (expense) income, net	(800)	485
Interest expense	(308)	(136)
Income from continuing operations before provision for income taxes	5,521	3,765
Provision for income taxes	(1,500)	(3,694)
Income from continuing operations	4,021	71
Discontinued operations
Loss on discontinued operations (net of tax)	(4,912)	(3,722)
Net loss	$ (891)	$ (3,651)
Basic Earnings per Share:
Income from continuing operations (in dollars per share)	$ 0.26	$ 0
Loss from discontinued operations (in dollars per share)	(0.32)	(0.24)
Net loss (in dollars per share)	(0.06)	(0.24)
Diluted Earnings per Share:
Income loss from continuing operations (in dollars per share)	0.26	0
Loss from discontinued operations (in dollars per share)	(0.31)	(0.24)
Net loss (in dollars per share)	$ (0.06)	$ (0.23)
Weighted average shares outstanding
Basic (in shares)	15,562	15,501
Diluted (in shares)	15,666	15,582

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS [Abstract]
Net loss	$ (891)	$ (3,651)
Other comprehensive loss net of applicable tax:
Foreign currency translation adjustments	(1,462)	(777)
Comprehensive loss	$ (2,353)	$ (4,428)

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands	Common Stock [Member]	Capital in Excess of Par Value [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Treasury Stock [Member]	Total
Balance at Dec. 31, 2013	$ 344	$ 43,635	$ 35,116	$ (539)	$ (5,836)	$ 72,720
Balance (in shares) at Dec. 31, 2013	17,302,000				(1,708,000)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss			(3,651)			(3,651)
Net issuance of restricted stock awards	$ 2					2
Net issuance of restricted stock awards (in shares)	(27,000)
Equity based compensation		1,185				1,185
Stock options and awards - excess tax benefits		34				34
Translation adjustments, net of tax				(777)		(777)
Balance at Dec. 31, 2014	$ 346	44,854	31,465	(1,316)	$ (5,836)	$ 69,513
Balance (in shares) at Dec. 31, 2014	17,275,000				(1,708,000)	15,566,599
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss			(891)			$ (891)
Issuance of common stock upon the exercise of stock options	$ 2	472				$ 474
Issuance of common stock upon the exercise of stock options (in shares)	94,000					94,000
Net issuance of restricted stock awards	$ (1)					$ (1)
Net issuance of restricted stock awards (in shares)	(17,000)
Equity based compensation		487				487
Stock options and awards - excess tax benefits		(60)				(60)
Translation adjustments, net of tax				(1,462)		(1,462)
Balance at Dec. 31, 2015	$ 347	$ 45,753	$ 30,574	$ (2,778)	$ (5,836)	$ 68,060
Balance (in shares) at Dec. 31, 2015	17,352,000				(1,708,000)	15,644,729

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY [Abstract]
Translation adjustments, tax	$ 944	$ 476

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Cash flows from operating activities:
Net loss	$ (891)	$ (3,651)
Loss from discontinued operations	4,912	3,722
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Loss on Investment	776	0
Depreciation, amortization and accretion	3,070	2,007
Provision for bad debts	772	340
Provision for obsolete inventory	1,293	2,232
Equity based compensation	487	1,185
Change in fair value of contingent consideration	90	0
Deferred income tax	(1,910)	516
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable	(628)	(700)
Inventories	3,136	(3,826)
Income tax receivable/(payable)	(196)	290
Other current assets	210	(1,129)
Other assets	(644)	(368)
Accounts payable	(7,529)	3,022
Accrued salaries and benefits	1	(425)
Accrued expenses	213	4,572
Customer deposits	(1,062)	1,060
Deferred service revenue	251	645
Other long-term liabilities	(54)	93
Deferred tax equity based compensation	(60)	0
Net cash provided by operating activities-continuing operations	2,237	9,585
Net cash used in operating activities-discontinued operations	(1,643)	(3,324)
Net cash (used in) provided by operating activities	594	6,261
Cash flows from investing activities:
Capital expenditures	(1,705)	(1,536)
Capitalization of software costs	(2,148)	(1,650)
Investment expenditure	(776)	0
Payments for acquisition, net of cash acquired	0	(5,000)
Proceeds from sale of business	12,100	0
Net cash provided by (used in) investing activities-continuing operations	7,471	(8,186)
Net cash used in investing activities -discontinued operations	(1,046)	(1,816)
Net cash provided by (used in) investing activities	6,425	(10,002)
Cash flows from financing activities:
Payments of long-term debt	(173)	(165)
Payments of other borrowings	(222,156)	(18,921)
Proceeds from other borrowings	217,156	23,921
Payments for deferred acquisition obligations	(3,000)	0
Proceeds from stock awards	473	2
Net cash (used in) provided by financing activities	(7,700)	4,837
Effect of exchange rate changes on cash and cash equivalents	(1,462)	(944)
Net (decrease) increase in cash and cash equivalents	(2,143)	152
Cash and cash equivalents at beginning of period	10,167	10,015
Cash and cash equivalents at end of period	8,024	10,167
Less cash and equivalents of discontinued operations at end of period	0	300
Cash and equivalents of continuing operations at end of period	8,024	9,867
Cash paid during the period for:
Interest	206	129
Income taxes, net of refunds	310	722
Supplemental disclosures of non-cash information:
Acquisition through notes payable	0	4,820
Contingent consideration payable in connection with acquisition	0	5,040
Sale of business through receivable	$ 3,320	$ 0

Employee Benefit Plans	12 Months Ended
Employee Benefit Plans	Dec. 31, 2015
Employee Benefit Plans [Abstract]
Employee Benefit Plans	Note 10 — Employee Benefit Plans The Company has a deferred profit-sharing retirement plan that covers substantially all employees. The Company’s annual contribution to the plan is discretionary. The Company’s did not make a contribution in 2015 or 2014. The plan also contains a 401(k) provision that allows employees to contribute a percentage of their salary up to the statutory limitation. These contributions are matched at the rate of 10% by the Company. The Company’s matching contributions under the 401(k) component were $359,000 and $318,000 in 2015 and 2014, respectively. The Company also maintains an incentive-compensation plan. Participants in the plan are key employees as determined by the Board of Directors and executive management. Compensation under the plan is based on the achievement of predetermined financial performance goals of the Company and its subsidiaries. Awards under the plan are payable in cash. Awards under the plan totaled $776,000 and $656,000, in 2015 and 2014, respectively. The Company also sponsors a deferred compensation plan for a select group of highly compensated employees. Participants may make elective deferrals of their salary to the plan in excess of tax code limitations that apply to the Company’s qualified plan. The Company invests the participants’ deferred amounts to fund these obligations. The Company also has the sole discretion to make employer contributions to the plan on behalf of the participants, though it did not make any employer contributions in 2015 or 2014.

Contingencies	12 Months Ended
Contingencies	Dec. 31, 2015
Contingencies [Abstract]
Contingencies	Note 11 — Contingencies The Company is subject to legal proceedings, which arise in the ordinary course of business. Additionally, U.S. Government contract costs are subject to periodic audit and adjustment. In the opinion of management, the ultimate liability, if any, with respect to these actions will not materially affect the financial position, results of operations, or cash flows of the Company.

Related Party Transactions	12 Months Ended
Related Party Transactions	Dec. 31, 2015
Related Party Transactions [Abstract]
Related Party Transactions	Note 14 — Related Party Transactions The Company leases its corporate wellness facility to related parties at a current rate of $9,775 per month. The Company receives a complimentary membership to this facility which is provided to all employees. During 2015 and 2014 the Company received rental income amounting to $117,300 for the lease of the facility in each year.

Subsequent Events	12 Months Ended
Subsequent Events	Dec. 31, 2015
Subsequent Events [Abstract]
Subsequent Events	Note 15 — Subsequent Events On March 24, 2016, the Company amended its credit facility with J.P. Morgan Chase, N.A. See Note 7 for further details.

Summary of Significant Accounting Policies (Details)	12 Months Ended
Summary of Significant Accounting Policies (Details)	Dec. 31, 2015 USD ($) Segment $ / shares shares	Dec. 31, 2014 USD ($) $ / shares shares
Basis of consolidation [Abstract]
Net loss associated with working capital adjustment on discontinued operations	$ (4,912,000)	$ (3,722,000)
Maximum maturity period to classify as cash equivalent	3 months
Other income [Abstract]
Foreign currency loss	$ (193,000)	(115,000)
Rental income-net	264,000	359,000
Investment write-off	(776,000)	0
Other	(95,000)	241,000
Total	(800,000)	485,000
Finite-Lived Intangible Assets [Line Items]
Amortization of capitalized software costs	2,100,000	1,700,000
Accelerated amortization	843,000	673,000
Amortization identifiable intangible assets	987,000	279,000
Components of identifiable intangible assets, including capitalized internal software development costs [Abstract]
Intangible assets, gross	12,915,000	10,767,000
Less accumulated amortization	(2,417,000)	(587,000)
Total	10,498,000	10,180,000
Indefinite-Lived Intangible Assets (Excluding Goodwill)	400,000	400,000
Intangible assets - net	10,898,000	10,580,000
Future amortization of intangible assets [Abstract]
2016	2,012,000
2017	1,911,000
2018	1,747,000
2019	1,350,000
2020	1,174,000
Thereafter	2,304,000
Total	10,498,000	10,180,000
Basic and diluted earnings per share computations [Abstract]
Income from continuing operations	$ 4,021,000	$ 71,000
Basic [Abstract]
Shares outstanding at beginning of year (in shares) \| shares	15,592,000	15,473,000
Weighted average shares (cancelled) issued during the year (in shares) \| shares	(30,000)	28,000
Weighted average common shares, basic (in shares) \| shares	15,562,000	15,501,000
Income from continuing operations per common share, basic (in dollars per share) \| $ / shares	$ 0.26	$ 0
Diluted [Abstract]
Weighted average common shares, basic (in shares) \| shares	15,562,000	15,501,000
Weighted average shares issued during the year (in shares) \| shares	11,000	4,000
Dilutive impact of stock options and restricted stock awards (in shares) \| shares	93,000	77,000
Weighted average common shares, diluted (in shares) \| shares	15,666,000	15,582,000
Income from continuing operations per common share, diluted (in dollars per share) \| $ / shares	$ 0.26	$ 0
Goodwill [Abstract]
Number of operating segments \| Segment	2
Number of reportable units \| Segment	2
Goodwill [Line Items]
Goodwill impairment charge	$ 22,671,000	$ 20,263,000
Goodwill [Roll Forward]
Net balances at beginning of period	11,051,000	6,852,000
Goodwill	37,430,000	27,115,000
Accumulated Impairment charge	(22,671,000)	(20,263,000)
Acquisition		10,315,000
Reclassified to Discontinued Operations		(6,116,000)
Divestiture	(3,708,000)
Net balance at end of period	11,051,000	11,051,000
Asset Impairment Charges [Abstract]
Impairment charge	0	0
Discontinued Operations [Member]
Goodwill [Line Items]
Goodwill impairment charge	2,400,000	0
Goodwill [Roll Forward]
Accumulated Impairment charge	(2,400,000)	0
Acquired and internally developed software costs [Member]
Components of identifiable intangible assets, including capitalized internal software development costs [Abstract]
Intangible assets, gross	12,725,000	10,577,000
Customer Relationships [Member]
Components of identifiable intangible assets, including capitalized internal software development costs [Abstract]
Intangible assets, gross	$ 160,000	160,000
Estimated Useful Life	7 years
Non-competition Agreements [Member]
Components of identifiable intangible assets, including capitalized internal software development costs [Abstract]
Intangible assets, gross	$ 30,000	30,000
Estimated Useful Life	1 year
Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives	3 years
Minimum [Member] \| Acquired and internally developed software costs [Member]
Components of identifiable intangible assets, including capitalized internal software development costs [Abstract]
Estimated Useful Life	3 years
Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives	25 years
Maximum [Member] \| Acquired and internally developed software costs [Member]
Components of identifiable intangible assets, including capitalized internal software development costs [Abstract]
Estimated Useful Life	7 years
Restaurants [Member]
Goodwill [Line Items]
Goodwill impairment charge	$ 12,433,000	12,433,000
Goodwill [Roll Forward]
Net balances at beginning of period	10,315,000	0
Goodwill	22,748,000	12,433,000
Accumulated Impairment charge	(12,433,000)	(12,433,000)
Acquisition		10,315,000
Reclassified to Discontinued Operations		0
Divestiture	0
Net balance at end of period	10,315,000	10,315,000
Hotel/Resort/Spa [Member]
Goodwill [Line Items]
Goodwill impairment charge	10,238,000	7,830,000
Goodwill [Roll Forward]
Net balances at beginning of period	0	6,116,000
Goodwill	13,946,000	13,946,000
Accumulated Impairment charge	(10,238,000)	(7,830,000)
Acquisition		0
Reclassified to Discontinued Operations		(6,116,000)
Divestiture	(3,708,000)
Net balance at end of period	0	0
Government Segment [Member]
Goodwill [Line Items]
Goodwill impairment charge	0	0
Goodwill [Roll Forward]
Net balances at beginning of period	736,000	736,000
Goodwill	736,000	736,000
Accumulated Impairment charge	0	0
Acquisition		0
Reclassified to Discontinued Operations		0
Divestiture	0
Net balance at end of period	$ 736,000	$ 736,000
Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Incremental shares excluded from computation of diluted earnings per share (in shares) \| shares	112,000	215,000

Acquisition (Details) - USD ($)		12 Months Ended
Acquisition (Details) - USD ($)	Sep. 18, 2014	Dec. 31, 2015	Dec. 31, 2014
Business Acquisition [Line Items]
Fair value of the long term portion of the note payable		$ 1,900,000
Amortization of identifiable intangible assets		987,000	$ 279,000
Aggregate purchase price		10,315,000
Acquisition revenue		832,000
Acquisition net loss			145,000
Schedule of purchase price allocation [Abstract]
Accounts receivable		83,000
Inventories		116,000
Intangible assets		7,190,000
Goodwill		10,315,000
Other assets		90,000
Total assets acquired		17,794,000
Accounts payable		124,000
Other current liabilities		365,000
Deferred Tax Liabilities		2,445,000
Total liabilities assumed		2,934,000
Purchase price		14,860,000
Acquired Finite-Lived Intangible Assets [Line Items]
Total identifiable intangible assets		7,190,000
Business Acquisition, Pro Forma Information [Abstract]
Revenues			219,328,000
Net loss			$ (559,000)
Earnings per share: [Abstract]
Basic (in dollars per share)			$ (0.04)
Diluted (in dollars per share)			$ (0.04)
Trade Name [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Indefinite intangible assets		400,000
Developed Technology [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets		$ 6,600,000
Estimated useful life		7 years
Customer Relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets		$ 160,000
Estimated useful life		7 years
Non-competition Agreements [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets		$ 30,000
Estimated useful life		1 year
Brink Software Inc. [Member]
Business Acquisition [Line Items]
Payments for the acquisition		$ 10,000,000
Period of purchase price payable		3 years
Contingent liability payable, Maximum		$ 7,000,000
Percentage of equity interest		100.00%
Amortization of identifiable intangible assets		$ 987,000	$ 279,000
Contingent purchase agreement escrow provision		1,000,000
Aggregate purchase price	$ 14,900,000
Cash acquired on purchase of business	184,000
Net cash paid for purchase of business	5,000,000
Additional estimated cash payments	9,900,000
Estimated fair value liability for contingent consideration		5,100,000
Transaction, integration, and other acquisition related costs			$ 163,000
Schedule of purchase price allocation [Abstract]
Goodwill	$ 14,900,000
Brink Software Inc. [Member] \| Tranche One [Member]
Business Acquisition [Line Items]
Payments for the acquisition		$ 5,000,000
Percentage of equity interest		51.00%
Brink Software Inc. [Member] \| Tranche Two [Member]
Business Acquisition [Line Items]
Payments for the acquisition		$ 3,000,000
Percentage of equity interest		49.00%
Brink Software Inc. [Member] \| Tranche Three [Member]
Business Acquisition [Line Items]
Payments for the acquisition		$ 2,000,000

Divestiture and Discontinued Operations (Details) - USD ($)		12 Months Ended
	Nov. 04, 2015	Dec. 31, 2015	Dec. 31, 2014
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Consideration received		$ 12,100,000	$ 0
Assets
Cash		0	300,000
Operations
Benefit from income taxes		3,300,000	2,100,000
Loss from discontinued operations, net of taxes		(4,912,000)	(3,722,000)
PAR Springer Miller Systems Inc [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Total consideration	$ 16,600,000
Consideration received	12,100,000
Consideration receivable	4,500,000
Estimated fair value of the notes receivable	3,300,000
Consideration receivable upon achievement of targets	$ 1,500,000
Assets
Cash		0	300,000
Accounts receivable - net		0	1,771,000
Other current assets		0	574,000
Property, plant and equipment - net		0	986,000
Goodwill		0	6,116,000
Intangible assets - net		0	12,372,000
Assets classified as held for sale		0	22,119,000
Liabilities
Accounts Payable		0	417,000
Accrued salaries and benefits		441,000	703,000
Accrued expenses		0	87,000
Customer Deposits		0	1,103,000
Deferred service revenue		0	2,307,000
Liabilities associated with assets held for sale		441,000	4,617,000
Operations
Total revenues		14,545,000	15,746,000
Loss from discontinued operations before income taxes		(5,702,000)	(5,816,000)
Loss on disposition		(2,408,000)	0
Benefit from income taxes		3,198,000	2,094,000
Loss from discontinued operations, net of taxes		$ (4,912,000)	$ (3,722,000)

Accounts Receivable, net (Details) - USD ($)	12 Months Ended
Accounts Receivable, net (Details) - USD ($)	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Accounts Receivable [Abstract]
Accounts receivable-net	$ 29,530,000	$ 29,674,000
Write-offs of accounts receivable	382,000	278,000
Provision for doubtful accounts	772,000	340,000
Government segment [Member]
Accounts Receivable [Abstract]
Accounts receivable-net	8,134,000	8,890,000
Government segment [Member] \| Billed [Member]
Accounts Receivable [Abstract]
Accounts receivable-net	9,400,000	9,340,000
Government segment [Member] \| Advance billings [Member]
Accounts Receivable [Abstract]
Accounts receivable-net	(1,266,000)	(450,000)
Hospitality segment [Member]
Accounts Receivable [Abstract]
Accounts receivable-net	21,396,000	20,784,000
Allowances for doubtful accounts	$ 875,000	$ 484,000	$ 422,000

Inventories, net (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Component of inventory use in hospitality product [Abstract]
Finished Goods	$ 8,775	$ 13,615
Work in process	402	457
Component parts	5,068	3,748
Service parts	7,254	8,108
Inventory net	21,499	25,928
Inventory reserves	$ 8,600	$ 7,900

Property, Plant and Equipment (Details) - USD ($)	12 Months Ended
Property, Plant and Equipment (Details) - USD ($)	Dec. 31, 2015	Dec. 31, 2014
Components of property, plant and equipment [Abstract]
Property, plant and equipment, Gross	$ 23,032,000	$ 21,366,000
Less accumulated depreciation	(17,316,000)	(16,218,000)
Property, plant and equipment, Net	5,716,000	5,148,000
Depreciation expense recorded	1,137,000	1,052,000
Rent received from leases	264,000	359,000
Future minimum rent payments due in 2016	306,000
Future minimum rent payments due in 2017	246,000
Future minimum rent payments due in 2018	57,000
Rental expense on operating leases	1,400,000	1,300,000
Future minimum lease payments under all non-cancelable operating leases [Abstract]
2016	1,466,000
2017	1,149,000
2018	924,000
2019	860,000
2020	336,000
Thereafter	738,000
Total	$ 5,473,000
Minimum [Member]
Components of property, plant and equipment [Abstract]
Estimated useful lives	3 years
Maximum [Member]
Components of property, plant and equipment [Abstract]
Estimated useful lives	25 years
Land [Member]
Components of property, plant and equipment [Abstract]
Property, plant and equipment, Gross	$ 253,000	253,000
Building and improvements [Member]
Components of property, plant and equipment [Abstract]
Property, plant and equipment, Gross	$ 5,645,000	5,645,000
Building and improvements [Member] \| Minimum [Member]
Components of property, plant and equipment [Abstract]
Estimated useful lives	20 years
Building and improvements [Member] \| Maximum [Member]
Components of property, plant and equipment [Abstract]
Estimated useful lives	25 years
Rental property [Member]
Components of property, plant and equipment [Abstract]
Property, plant and equipment, Gross	$ 5,330,000	5,308,000
Rental property [Member] \| Minimum [Member]
Components of property, plant and equipment [Abstract]
Estimated useful lives	20 years
Rental property [Member] \| Maximum [Member]
Components of property, plant and equipment [Abstract]
Estimated useful lives	25 years
Furniture and equipment [Member]
Components of property, plant and equipment [Abstract]
Property, plant and equipment, Gross	$ 11,804,000	$ 10,160,000
Furniture and equipment [Member] \| Minimum [Member]
Components of property, plant and equipment [Abstract]
Estimated useful lives	3 years
Furniture and equipment [Member] \| Maximum [Member]
Components of property, plant and equipment [Abstract]
Estimated useful lives	8 years