Divestiture and Discontinued Operations

9 Months Ended

Sep. 30, 2016

Divestiture and Discontinued Operations [Abstract]

Divestiture and Discontinued Operations

Note 2 — Divestiture and Discontinued Operations

In connection with the sale of the hotel/spa technology business, the 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 PSMS.  The estimated fair value of the remaining portion of the note receivable, due on May 4, 2017, is approximately $4.4 million and accordingly has been reported as a current asset in PAR’s September 30, 2016 Consolidated Balance Sheet.

In addition to the Base Purchase Price, contingent consideration of up to $1,500,000 is payable to PAR based on the achievement of certain agreed-upon revenue and earnings targets for calendar years 2016 through 2018.  As of September 30, 2016, the Company has not recorded any amount associated with this contingent consideration as it does not believe achievement of the related targets is probable.

At September 30, 2016 and December 31, 2015 there were $5,000 and $441,000 of accrued liabilities of discontinued operations recorded on the consolidated balance sheet.

During the nine months ended September 30, 2016, the Company paid a $977,000 working capital adjustment, of which $939,000 was included in accrued expenses at December 31, 2015 and the difference paid resulted in a loss (net of tax) of $26,000.

The following table summarizes the results from discontinued operations (in thousands):

	For the three months ended September 30,					For the nine months ended September 30,
	2016		2015			2016			2015
Operations
Total revenues	$	-	$	4,267		$	-		$	13,037
Loss from discontinued operations before income taxes	$	-	$	(3,796	)	$	(38	)	$	(6,505	)
Benefit from income taxes		-		1,010			12			2,000
Loss from discontinued operations, net of taxes	$	-	$	(2,786	)	$	(26	)	$	(4,505	)