8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of report (Date of earliest event reported): May 15, 2017

PAR Technology Corporation

(Exact name of registrant as specified in its charter)

Delaware	1-09720	16-1434688
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

PAR Technology Park, 8383 Seneca Turnpike, New Hartford, New York 13413-4991

(Address of Principal Executive Offices) (Zip Code)

Registrant's telephone number, including area code: (315) 738-0600

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

   

Item 2.02 Results of Operations and Financial Condition.

On May 15, 2017, PAR Technology Corporation (the “Company”) issued a press release announcing its results of operations for the fiscal quarter ended March 31, 2017. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.*

Item 7.01 Regulation FD Disclosure

The Company will hold a conference call at 4:30 p.m. (Eastern) on May 15, 2017, during which the Company’s management will discuss the results of operations for the fiscal quarter ended March 31, 2017.  To participate in the call, please call (844) 419-5412, approximately 10 minutes in advance.  No passcode is required to participate in the live call or to listen to the replay version.  Individual & Institutional Investors will have the opportunity to listen to the conference call/event over the internet by visiting PAR’s website at www.partech.com.  Alternatively, listeners may access an archived version of the presentation call after 7:30 p.m. on May 15, 2017 through May 22, 2017 by dialing (855) 859-2056 and input conference ID 21046255.*

Item 9.01. Financial Statements and Exhibits

(d) Exhibits.

99.1 PAR Technology Corporation Press Release dated May 15, 2017.

* The information in Item 2.02, Item 7.01, and Exhibit 99.1 of this Current Report on Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing. 

SIGNATURES

Pursuant to the requirements 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
	(Registrant)
Date:  May 15, 2017	/s/Bryan A. Menar
	Bryan A. Menar
	Chief Financial Officer

EX-99.1

Exhibit 99.1

FOR RELEASE:   CONTACT: New Hartford, NY, March 13, 2017 Christopher R. Byrnes (315) 738-0600ext. 6226 cbyrnes@partech.com,  www.partech.com

PAR TECHNOLOGY CORPORATION ANNOUNCES

2017 FIRST QUARTER RESULTS FROM CONTINUING OPERATIONS

· Revenues Increase 19.0% Due to One-Time Project with Large Tier 1 Customer

· GAAP Earnings Per Share Reported at $0.08 vs $0.00 in Q1 2016

· Adjusted Earnings Per Share Reported at $0.14 vs. $0.06 in Q1 2016

New Hartford, NY- May 15, 2017 -- PAR Technology Corporation (NYSE: PAR) today announced its results of continuing operations for its first quarter ended March 31, 2017.

Summary of Fiscal 2017 First Quarter Financial Results From Continuing Operations

First Quarter 2017

· First quarter revenues of $65.9 million, compared to $55.3 million in the same period in 2016, a 19.1% increase.

· GAAP net income of $1.3 million, or $0.08 per diluted share, an increase from GAAP net income of $15,000, or $0.00 earnings per diluted share for the same period in 2016.

· Non-GAAP net income of $2.2 million, or $0.14 per diluted share, compared to non-GAAP net income of $925,000 or $0.06 earnings per diluted share, for the same period in 2016.

A reconciliation and description of non-GAAP financial measures to their comparable GAAP financial measures are included in the tables at the end of this press release.

“I am very pleased with the financial results for our first quarter as our Restaurant/Retail segment revenues grew more than 52% from the prior year’s first quarter.  The strong first quarter performance was driven by significantly higher demand for our restaurant hardware products and continued deployments of our Brink POS software.  Offsetting the Restaurant/Retail growth was the decline in our Government segment revenues as they continue to be impacted by the transition from lower margin Program Management Office (PMO) contracts to more higher margin, value-add contracts in Intelligence, Surveillance & Reconnaissance (ISR),” commented Dr. Donald H. Foley, President & CEO of PAR Technology Corporation.  “We are off to a strong start to the year, as we were able to leverage the accelerated hardware technology deployment of a strategic customer in Q1.  We expect to sustain our momentum for the remainder of the year but at a more moderate pace.”

Conference Call.

There will be a conference call at 4:30 p.m. (Eastern) on May 15, 2017, during which the Company’s management will discuss the results of operations for the first quarter of 2017.  To participate in the call, please call 844-419-5412, approximately 10 minutes in advance.  No passcode is required to participate in the live call or to listen to the replay version.  Individual & Institutional Investors will have the opportunity to listen to the conference call/event over the internet by visiting PAR’s website at www.partech.com.  Alternatively, listeners may access an archived version of the presentation call after 7:30 p.m. on May 15, 2017 through May 22, 2017 by dialing 855-859-2056 and using conference ID 21046255.

About PAR Technology Corporation.

PAR Technology Corporation’s stock is traded on the New York Stock Exchange under the symbol “PAR”. PAR’s Restaurant/Retail segment has been a leading provider of restaurant and retail technology for more than 35 years. PAR offers technology solutions for the full spectrum of restaurant operations, from large chain and independent table service restaurants to international quick service chains. Products from PAR also can be found in retailers, cinemas, cruise lines, stadiums, and food service companies. PAR’s Government Business is a leader in providing computer-based system design, engineering and technical services to the Department of Defense and various federal agencies. For more information visit http://www.partech.comor connect with us onFacebookandTwitter.

Forward-Looking Statements.

This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements appear throughout this press release, including express or implied forward-looking statements relating to our expectations regarding anticipated financial performance, customer and product opportunities, and assumptions as to future events. Forward-looking statements are subject to a variety of risks and uncertainties, many of which are beyond the Company’s control, that could cause actual results to differ materially from those contemplated in these statements. Factors that could cause actual results to differ materially, include delays in new product development and/or product introduction, changes in customer product and service demands, concentration of revenues from a small group of customers, product and service competition, risks associated with the ongoing investigation into possible violations of the U.S. Foreign Corrupt Practices Act and similar laws, including sanctions, fines or remedial measures that may be imposed by the U.S. Department of Justice or U.S. Securities and Exchange Commission (“SEC”), additional expenses related to remedial measures, risks associated with the Company’s identified material weaknesses in internal control over financial reporting and any other failure to maintain effective internal controls, and the other factors discussed in our most recent Annual Report on Form 10-K, our Quarterly Report on Form 10-Q for the quarter ended March 31, 2017 and other filings with the SEC. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities law.

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PAR TECHNOLOGY CORPORATIONAND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)

(Unaudited)

Assets	March 31, 2017			December 31, 2016
Current assets:
Cash and cash equivalents	$	5,470		$	9,055
Accounts receivable-net		34,241			30,705
Inventories-net		24,800			26,237
Note receivable		3,794			3,510
Income taxes receivable		-			261
Other current assets		4,350			4,027
Assets of discontinued operations		462			462
Total current assets		73,117			74,257
Property, plant and equipment - net		9,042			7,035
Deferred income taxes		17,056			17,417
Goodwill		11,051			11,051
Intangible assets - net		11,411			10,966
Other assets		3,861			3,785
Total Assets	$	125,538		$	124,511
Liabilities and Shareholders’ Equity
Current liabilities:
Current portion of long-term debt	$	189		$	187
Borrowings of line of credit		1,000
Accounts payable		17,460			16,687
Accrued salaries and benefits		5,297			5,470
Accrued expenses		4,492			4,682
Customer deposits and deferred service revenue		17,807			19,814
Total current liabilities		46,245			46,840
Long-term debt		331			379
Other long-term liabilities		7,705			7,712
Total liabilities		54,281			54,931
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; 17,493,293 and 17,479,454 sharesissued, 15,785,184 and 15,771,345 outstanding at March 31, 2017 and December 31, 2016, respectively		350			350
Capital in excess of par value		46,392			46,203
Retained earnings		33,804			32,357
Accumulated other comprehensive loss		(3,453	)		(3,494	)
Treasury stock, at cost, 1,708,109 shares		(5,836	)		(5,836	)
Total shareholders’ equity		71,257			69,580
Total Liabilities and Shareholders’ Equity	$	125,538		$	124,511

PAR TECHNOLOGY CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

(Unaudited)

	For the three months ended March 31,
	2017			2016
Net revenues:
Product	$	37,206		$	22,084
Service		14,343			11,704
Contract		14,316			21,517
		65,865			55,305
Costs of sales:
Product		27,572			16,442
Service		9,885			8,599
Contract		12,747			19,655
		50,204			44,696
Gross margin		15,661			10,609
Operating expenses:
Selling, general and administrative		9,610			7,542
Research and development		3,569			2,762
Amortization of identifiable intangible assets		241			241
		13,420			10,545
Operating income from continuing operations		2,241			64
Other expense, net		(248	)		(70	)
Interest (expense) income, net		(32	)		29
Income from continuing operations before provision for income taxes		1,961			23
Provision for income taxes		(697	)		(8	)
Income from continuing operations		1,264			15
Discontinued operation
Income from discontinued operations (net of tax)		183			-
Net income	$	1,447		$	15
Basic Earnings per Share:
Income from continuing operations		0.08			0.00
Income from discontinued operations		0.01			0.00
Net income	$	0.09		$	0.00
Diluted Earnings per Share:
Income from continuing operations		0.08			0.00
Income from discontinued operations		0.01			0.00
Net income	$	0.09		$	0.00
Weighted average shares outstanding
Basic		15,781			15,646
Diluted		15,978			15,723

PAR TECHNOLOGY CORPORATION

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS

(in thousands, except per share data)

(Unaudited)

	For the three months ended March 31, 2017									For the three months ended March 31, 2016
	Reported basis (GAAP)			Adjustments			Comparable basis (Non- GAAP)			Reported basis (GAAP)			Adjustments			Comparable basis (Non- GAAP)
Net revenues	$	65,865			-			65,865		$	55,305			-			55,305
Costs of sales		50,204						50,204			44,696			-			44,696
Gross Margin		15,661						15,661			10,609			-			10,609
Operating Expenses
Selling, general and administrative		9,610			1,184			8,426			7,542			1,177			6,365
Research and development		3,569			-			3,569			2,762			-			2,762
Acquisition amortization		241			241			-			241			241			-
Total operating expenses		13,420			1,425			11,995			10,545			1,418			9,127
Operating income		2,241			1,425			3,666			64						1,482
Other (expense) income, net		(248	)					(248	)		(70	)					(70	)
Interest (expense) income, net		(32	)		-			(32	)		29			26			55
Income from continuing operations before provision for income taxes		1,961			1,425			3,386			23			1,444			1,467
Provision for income taxes		(697	)		(527	)		(1,224	)		(8	)		(534	)		(542	)
Income from continuing operations		1,264			898			2,162			15			910			925
Income from discontinued operations (net of tax)		183			-			183			-			-			-
Net income	$	1,447					$	2,345		$	15					$	925
Income per diluted share from continuing operations	$	0.08					$	0.14		$	0.00					$	0.06
Income per diluted share from discontinued operations	$	0.01					$	0.01		$	0.00					$	0.00
Income per diluted share	$	0.09					$	0.15		$	0.00					$	0.06

The Company reports its financial results in accordance with GAAP.  However, non-GAAP adjusted financial measures, as defined in the reconciliation table above, are provided because management uses these non-GAAP measures in evaluating the results of the continuing operations of the Company and believes this information provides investors supplemental insight into underlying business trends and operating results. These non-GAAP measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP. In addition, these non-GAAP measures should be read in conjunction with the Company’s financial statements prepared in accordance with GAAP.

The Company’s results of operations are impacted by certain non-recurring charges, including severance charges from restructuring business operations, equity based compensation, acquisition related expenditures, and other non-recurring charges that may not be indicative of the Company’s financial performance. Management believes that adjusting its operating expenses, operating income, net earnings and diluted earnings per share to remove non-recurring charges provides a useful perspective with respect to our operating results and provides supplemental information to both management and investors by removing items that are difficult to predict and are often unanticipated.  The Company believes the adjustments provide a useful comparison on a year-over-year basis.

During the first quarter of 2017, the Company recorded charges within selling, general and administrative of $962,000 related to the Company’s previously disclosed investigation of import/export and sales documentation activities at the Company’s China and Singapore offices. In addition, $177,000 of equity based compensation charges, $21,000 of investigation costs related to the Company’s former chief financial officer’s unauthorized transfers of Company funds, and $24,000 of expenses related to the implementation of the Company’s ERP system, were recorded during the first quarter of 2017.  Lastly, the Company recognized amortization of acquired intangible assets of $241,000 related to the Company’s acquisition of Brink.

During the first quarter of 2016, the Company recorded charges of $766,000 of investigation costs related to the Company’s former chief financial officer’s unauthorized transfers of Company funds, $345,000 related to the initial phase of the planned implementation of a new enterprise resource system in connection with the Business Transformation Project and equity based compensation charges of $66,000.  Lastly, the Company recognized amortization of acquired intangible assets of $241,000 and accreted interest of $26,000 related to the Company’s acquisition of Brink.    The aforementioned charges, along with an associated adjustment to the Company’s provision for income taxes have been excluded in the Company’s non-GAAP measures because they are considered non-recurring in nature and are quantitatively and qualitatively different from the Company’s core operations during any particular period.