PAR TECHNOLOGY CORP (Form: 8-K/A, Received: 02/03/2020 08:27:05)

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of report (Date of earliest event reported): December 19, 2019 (December 18, 2019)

PAR Technology Corporation

(Exact name of registrant as specified in its charter)

(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))

Securities registered pursuant to Section 12(b) of the Act:

Name of each exchange on which registered

New York Stock Exchange

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. ☐

On December 19, 2019, PAR Technology Corporation (the “Company”) filed a Current Report on Form 8-K (the “Original 8-K”) disclosing that ParTech, Inc., a wholly owned subsidiary of the Company, had completed the acquisition of AccSys, LLC (f/k/a AccSys, Inc., and otherwise known as Restaurant Magic (“Restaurant Magic”)) on December 18, 2019 pursuant to the terms of an interest purchase agreement dated November 7, 2019. This Current Report on Form 8-K/A amends and supplements the Original 8-K to include the financial statements of Restaurant Magic and the pro forma financial information required in connection with the acquisition of Restaurant Magic.

Item 9.01

Financial Statements and Exhibits

The Company is filing this amendment to the Original 8-K to provide:

(a)	Financial Statements of Businesses Acquired.

The audited financial statements of Restaurant Magic for the year ended December 31, 2018 and the unaudited financial statements of Restaurant Magic for the nine months ended September 30, 2018 and September 30, 2019 are set forth in Exhibits 99.1 and 99.2, respectively, and are incorporated by reference into this Item 9.01(a).

(b)	Pro Forma Financial Information.

The unaudited pro forma condensed combined consolidated balance sheet of the Company as of September 30, 2019 and the unaudited pro forma condensed combined consolidated statements of operations of the Company for the year ended December 31, 2018 and the nine months ended September 30, 2019 are set forth in Exhibit 99.3 hereto and are incorporated by reference into this Item 9.01(b).

Consent of BDO USA, LLP.

Audited financial statements of AccSys, Inc. for the year ended December 31, 2018.

Unaudited financial statements of AccSys, Inc. for the nine months ended September 30, 2018 and September 30, 2019.

Unaudited pro forma condensed combined consolidated balance sheet of PAR Technology Corporation as of September 30, 2019 and unaudited pro forma condensed combined consolidated statements of operations of PAR Technology Corporation for the year ended December 31, 2018 and the nine months ended September 30, 2019.

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

Date: February 3, 2020

Chief Financial and Accounting Officer

(Principal Financial Officer)

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

PAR Technology Corporation

New Hartford, New York

We hereby consent to the incorporation by reference in the Registration Statements on Form S-3 (No. 333-228026 and 333-102197) and Form S-8 (No. 333-232589, 333-119828, 33-04968, 33-39784, 33-58110, 033-63095, 333-208063, 333-187246 and 333-137647) of PAR Technology Corporation of our report dated December 13, 2019, relating to the consolidated financial statements of AccSys, Inc., which appear in this Current Report on Form 8-K/A.

/s/ BDO USA, LLP

Tampa, FL

January 31, 2020

Exhibit 99.1

ACCSYS, INC. AND SUBSIDIARY

CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2018

ACCSYS, INC. AND SUBSIDIARY

Table of Contents

December 31, 2018

	Page

Independent Auditors' Report	1

Consolidated Financial Statements as of and for the year ended December 31, 2018:

Balance Sheet	2- 3

Statement of Operations and Shareholders' Deficit	4

Statement of Cash Flows	5

Notes to Consolidated Financial Statements	6- 13

Tel: 813-321-6869

Fax: 813-448-1886

www.bdo.com

501 E Kennedy Blvd, Suite 910

Tampa, FL 33602

Independent Auditor’s Report

Board of Directors

Accsys, Inc.

Tampa, Florida

We have audited the accompanying consolidated financial statements of Accsys, Inc. and its subsidiary, which comprise the consolidated balance sheet as of December 31, 2018, and the related consolidated statements of operations and shareholders’ deficit, and cash flows for the year then ended, and the related notes to the consolidated financial statements.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Accsys, Inc. and its subsidiary as of December 31, 2018, and the results of their operations and their cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Certified Public Accountants

December 13, 2019

BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

BDO is the brand name for the BDO network and for each of the BDO Member Firms.

ACCSYS, INC. AND SUBSIDIARY

Consolidated Balance Sheet

December 31, 2018

Assets
Current Assets:
Cash and cash equivalents	$	759,297
Accounts and unbilled receivables		109,562
Prepaid expenses and other current assets		109,969
Total current assets		978,828
Property and equipment, at cost:
Office equipment		286,792
Leasehold improvements		40,500
Furniture and fixtures		25,246
Computer software		7,249
		359,787
Less accumulated depreciation and amortization		(293,630	)
Net property and equipment		66,157
Total Assets	$	1,044,985

See notes to consolidated financial statements.

Page 2

ACCSYS, INC. AND SUBSIDIARY

Consolidated Balance Sheet - Continued

December 31, 2018

Liabilities and Shareholders' Deficit
Current Liabilities:
Accounts payable	$	647,770
Payroll and payroll related liabilities		249,103
Customer deposits		94,188
Customer rebates payable		68,471
Deferred revenue		965,759
Line of credit		100,000
Capital lease obligations - current portion		20,754
Shareholder notes payable - current portion		30,000
Total current liabilities		2,176,045
Capital lease obligations, net of current portion		25,724
Shareholder notes payable, net of current portion		4,495,100
Deferred liabilities - shareholders		1,734,636
Total liabilities		8,431,505
Commitments (Note 5)
Shareholders' Deficit:
Common stock, $1 par value, 1,000 shares authorized; 810 shares issued and outstanding		1,000
Additional paid-in capital		475,627
Treasury stock, 190 shares, at cost		(300,000	)
Deficit		(7,563,147	)
Total shareholders' deficit		(7,386,520	)
Total Liabilities and Shareholders' Deficit	$	1,044,985

See notes to consolidated financial statements.

Page 3

ACCSYS, INC. AND SUBSIDIARY

Consolidated Statement of Operations and Shareholders' Deficit

For the Year Ended December 31, 2018

Revenues, net	$	6,118,217
Costs of revenues		3,349,103
Gross profit		2,769,114
Operating expenses		3,158,020
Operating loss		(388,906	)
Other income (expense):
Interest income		232
Interest expense		(198,783	)
Other expense		(26,636	)
Total other expense, net		(225,187	)
Net loss		(614,093	)
Deficit, beginning of year		(6,871,054	)
Less distributions		(78,000	)
Deficit, end of year	$	(7,563,147	)

See notes to consolidated financial statements.

Page 4

ACCSYS, INC. AND SUBSIDIARY

Consolidated Statement of Cash Flows

For the Year Ended December 31, 2018

Increase (Decrease) in Cash and Cash Equivalents Cash flows from operating activities:
Net loss	$	(614,093	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		23,852
Forgiveness of employee advances		250
Provision for bad debts		29,297
Changes in assets and liabilities:
Accounts receivable		473,337
Prepaid expenses and other current assets		16,431
Accounts payable		325,360
Payroll and payroll related liabilities		113,678
Customer deposits		28,819
Customer rebate payable		(1,075	)
Deferred revenues		(201,237	)
Net cash provided by operating activities		194,619
Cash flows from financing activities:
Distribution to shareholders		(78,000	)
Payments on capital lease obligations		(20,268	)
Payments on shareholder note payable		(37,500	)
Cash used in financing activities		(135,768	)
Net increase in cash and cash equivalents		58,851
Cash and cash equivalents, beginning of year		700,446
Cash and cash equivalents, end of year	$	759,297

Supplemental Disclosure of Cash Flow Information:

Cash paid for interest	$	129,207

Supplemental Disclosure of Noncash Investing and Financing Transactions:

Capital lease obligations for equipment	$	43,790

See notes to consolidated financial statements.

Page 5

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

December 31, 2018

Note 1 - Description of business and summary of significant accounting policies:

Nature of business

AccSys, Inc. (d/b/a Restaurant Magic Software), ("AccSys") was initially incorporated under the laws of the state of Florida in 1979. In November 2019, AccSys converted to a limited liability company under the laws of state of Delaware. AccSys's primary product, Data Central, is a suite of back office applications designed to help restaurant managers achieve operational and financial goals. The software integrates information from customers' existing Point of Sale, inventory, supply, payroll, and accounting platforms to provide a comprehensive view of operations. Data Central is offered as Software as a Service (SaaS) to its customers. The Company is headquartered in Tampa, Florida and its customers are located throughout the United States.

Basis of presentation

The Company has adopted the Financial Accounting Standards Board (FASB) Codification (Codification). The Codification is the single official source of authoritative accounting principles generally accepted in the United States of America (U.S. GAAP) recognized by the FASB to be applied by nongovernmental entities, and all of the Codification's content carries the same level of authority.

Basis of consolidation

At December 31, 2018, the accompanying consolidated financial statements include the accounts of AccSys and its wholly-owned subsidiary, AfterWords, Inc. ("AfterWords"). AccSys and Afterwards are hereinafter collectively referred to as the "Company." In November 2019 the Company's interest in AfterWords was transferred to a separate related entity. All significant intercompany balances and transactions have been eliminated in consolidation.

Liquidity

The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplate the realization of assets and liquidation of liabilities in the normal course of business. At December 31, 2018, the Company has working capital and shareholder deficits of approximately $1,197,200 and $7,387,000, respectively. However, a significant portion of these deficits arose because of investments made in the launch of AfterWords. The entity was spun off to a related entity in November 2019 and the Company does not anticipate that additional investments will be required. Furthermore the working capital deficit includes approximately $966,000 of deferred revenues which will not require the outlay of cash. The Company generated net income in 2019 and anticipates generating significant net income and cash flow from operations in 2020 and beyond. And in the event such positive results of operations and cash flows do not come to fruition, the shareholders have represented that if necessary, they will infuse adequate capital to meet the Company's obligations, through at a minimum, one year from the date the financial statements are issued. Accordingly, management believes the Company will have adequate resources to meet its obligations through, at a minimum, one year from the date of these financial statements.

Page 6

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

December 31, 2018

Note 1 - Description of business and summary of significant accounting policies - continued:

Use of estimates in the preparation of financial statements

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. The reported amounts of revenues and expenses during the reporting period may be affected by these estimates. Estimates that are critical to the accompanying consolidated financial statement relate primarily to management's belief that all of the Company's long-lived asset are recoverable and that the Company will generate adequate cash to meet its obligations through December 13, 2020. Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the period that they are determined to be necessary. Actual results could differ from these estimates.

Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of three months or less from date of purchase to be cash equivalents.

Accounts receivable and credit policies

The Company's payment terms generally require payment within 30 days. Management performs ongoing credit evaluations of the Company's customers and generally does not require collateral as management believes the Company has collection measures in place to limit the potential for significant losses. The Company maintains allowances for doubtful accounts, when applicable, for estimated losses resulting from the inability of its customers to make required payments. Management considers the following factors when determining the collectibility of specific customer accounts: customer creditworthiness, past transaction history with the customer, current economic industry trends, and changes in customer payment terms. Balances that remain outstanding after the Company has made reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable. Substantially all of the Company's receivables were recovered subsequent to December 31, 2018; accordingly, no allowance for doubtful accounts was deemed necessary as of such date.

Page 7

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

December 31, 2018

Note 1 - Description of business and summary of significant accounting policies - continued:

Revenue and cost recognition

The Company prepares its consolidated financial statements using the accrual basis of accounting, whereby revenues are recognized when earned and expenses are recognized when incurred. Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the price to the customer is fixed or determinable, and collectibility of the receivable is reasonably assured.

The Company enters in contractual relationships with customers to provide back office restaurant management. These services are provided under arrangements that allow for the use of a product or service over a period of time without taking possession of the Company's software.

Revenues from subscription services are recognized over the subscription period, which is generally on an annual basis, while revenue from professional services are recognized upon the completion of the services. Cash received from customers in excess of revenue recognized is recorded as deferred revenue. Revenue is recorded net of related discounts, rebates and promotions.

Costs of revenues are comprised primarily of hosting and infrastructure fees, and salaries and employee benefits for employees dedicated to providing customer service. Costs of revenues are recognized as incurred, which generally matches in the same period in which the corresponding revenues are recognized.

Property and equipment

Property and equipment are stated at cost less accumulated depreciation and amortization. Repairs and maintenance are expensed as incurred. Depreciation and amortization are determined using the straight-line method over the shorter of the lease terms or estimated useful lives of the respective assets, which range from 3 to 39 years. Upon the sale, retirement or other disposition of assets, the related cost and accumulated depreciation and amortization are eliminated from the accounts, and any gain or loss is recognized in operations.

Property and equipment includes leased assets having a cost of $66,097 and net book value of $46,478 at December 31, 2018. Depreciation and amortization in the accompanying consolidated statement of cash flows is comprised of $18,716 of amortization of leased assets, and depreciation and amortization of other property and equipment of $5,136.

Page 8

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

December 31, 2018

Note 1 - Description of business and summary of significant accounting policies - continued:

Impairment of long-lived assets

The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. At December 31, 2018, management believes all of the Company’s long-lived assets are recoverable.

Income taxes

Because AccSys and Afterwards were Subchapter S Corporations as of December 31, 2018, the Company is not subject to income taxes; rather, the results of its operations flow through to the Company’s shareholders for inclusion in their personal income tax returns. Accordingly, these consolidated financial statements do not include any provision for income taxes.

The Company is required to evaluate each of its tax positions to determine if they are more likely than not to be sustained if the taxing authority examines the respective position. A tax position includes an entity's status as a pass-through entity and the decision not to file a tax return. Management has evaluated each of the Company’s tax positions and determined that no provision or liability for income taxes is necessary.

Advertising costs

Advertising costs, which are expensed as incurred, totaled $267,969 in 2018.

Internally developed software

The Company charges all product development expenses to operations as they are incurred because management previously determined that the time period during which costs could be capitalized from the point of reaching technological feasibility until the time of general product release was very short, and consequently, the amounts that could be capitalized would not be material to the Company's consolidated financial position or results of operations.

Date of management's review

Management has evaluated events and transactions subsequent to December 31, 2018 for potential recognition or disclosure through December 13, 2019, which is the date the consolidated financial statements were available to be issued, and noted no transactions or events requiring additional disclosure.

Page 9

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

December 31, 2018

Note 2 - Line of credit:

The Company has a revolving line of credit facility with a bank that allows for maximum borrowings of $100,000; no availability under the line remained as of December 31, 2018. Advances under the line bear interest at the prime rate of the lender plus 4.75% (the interest rate was 10.25% as of December 31, 2018). The line of credit is secured by substantially all of the Company's assets.

Note 3 - Shareholder notes payable:

Shareholder notes payable consist of the following:

Notes with interest only payments made on an annual basis.
The notes, which bear interest at a rate of 4.5%, and are secured by a second interest (see Note 2) in substantially all of the Company's assets and intellectual property, were initially due on demand. However, in 2019 the notes were modified to have a maturity date subsequent to December 31, 2020. Accordingly, they have been reflected as non-current in the accompanying consolidated balance sheet.	$	4,130,000
Notes with interest only payments made on an annual basis.
The note, which bear interest at a rate of 5.0%, and are secured by a second interest (see Note 2) in substantially all of the Company's assets and intellectual property, were initially due on demand. However, in 2019 the notes were modified to have a maturity date subsequent to December 31, 2020. Accordingly, they have been reflected as non-current in the accompanying consolidated balance sheet.		215,100
Note payable to former shareholder with quarterly principal payments of $7,500 plus interest at a fixed rate of 3.25%.
The note matures on December 7, 2024 and is unsecured.		180,000
Shareholder notes payable	$	4,525,100

Interest expensed and paid under the above mentioned notes approximated $194,000 and $129,000, respectively, in 2018. These amounts include $83,152 and $58,608 of interest expensed and paid to the former shareholder. Accrued interest under the above mentioned notes was $303,736 as of December 31, 2018.

Page 10

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

December 31, 2018

Note 3 - Shareholder notes payable - continued:

Future minimum payments for shareholder notes are as follows:

Years ending December 31,
2019	$	30,000
2020		30,000
2021		4,375,100
2022		30,000
2023		30,000
Thereafter		30,000
Total shareholder notes payable		4,525,100
Less current portion		30,000
Shareholder notes payable - non current	$	4,495,100

Note 4 - Capital leases:

The Company has entered into various lease agreements for computer hardware with Dell. These agreements are for a period of 36-60 months with interest rates between 5.00% and 22.92%. Upon termination ownership transfers to the Company with the payment of a bargain purchase option.

Future minimum payments under the leases are as follows:

Years ending December 31,
2019	$	23,713
2020		19,106
2021		7,978
2022		172
Total future minimum lease payments		50,969
Less amount representing interest		4,491
Total present value of minimum lease payments		46,478
Less current portion		20,754
Present value of minimum lease payments	$	25,724

Page 11

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

December 31, 2018

In April 2019, the Company entered into a capital lease having a term of 36 months whereby the initial present value of the minimum lease payments approximated $302,400.

Note 5 - Commitments

On November 7, 2017 the Company entered into an operating lease that expires October 31, 2021 for office space in Tampa, Florida.

Minimum future lease payments are as follows:

Years ending December 31,
2019	$	210,906
2020		217,233
2021		185,531
Total	$	613,670

Rent expense approximated $197,770 for the year December 31, 2018.

Note 6 - Employee benefit plan:

The Company adopted an employee savings plan under the IRS Code Section 401(k). The plan covers substantially all employees of the Company. Each participant may contribute amounts up to 6% of eligible earnings. The Company made matching contributions of $38,557 in 2018.

Note 7 - Concentrations of credit risk:

Financial instruments that potentially subject the Company to concentration of credit risk consist primarily of cash and cash equivalents, and accounts receivable. Bank balances periodically exceed federally insured limits and therefore the Company is subject to credit risk to the extent that a financial institution may be unable to fulfill its obligation to return the Company's cash held at such financial institution. The Company has not experienced any losses in its accounts.

Four and three customers accounted for approximately 28% of the Company's accounts receivable and approximately 26% of the Company's revenues, respectively, as of and for the year ended December 31, 2018.

Page 12

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

December 31, 2018

Note 8 - Deferred liabilities - shareholders:

At December 31, 2018, the Company has aggregate deferred compensation and interest payable of approximately $1,211,500 and $523,000, respectively, to two of its shareholders for services rendered and interest abatements negotiated prior to March 7, 2015. The liabilities are required to be paid within 90 days after (i) the closing of a "Sale of the Company" (as defined in the Shareholders Memorandum and Agreement dated March 7, 2015) and (ii) the satisfaction of certain related party notes payable. Since management does not anticipate the deferred compensation or deferred interest will be paid before January 1, 2021 the amounts have been reflected as non-current in the accompanying consolidated balance sheet.

Page 13

ACCSYS, INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS AS OF

SEPTEMBER 30, 2019 AND DECEMBER 31, 2018

AND CONSOLIDATED STATEMENTS OF

OPERATIONS AND SHAREHOLDERS' DEFICIT, AND OF CASH FLOWS FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2019 AND 2018

(Unaudited)

ACCSYS, INC. AND SUBSIDIARY

Table of Contents

September 30, 2019 and 2018 and December 31, 2018

Consolidated Financial Statements (Unaudited):	Page

Balance Sheets as of September 30, 2019 and December 31, 2018	1- 2

Statements of Operations and Shareholders' Deficit for the nine months ended September 30, 2019 and 2018	3

Statements of Cash Flows for the nine months ended September 30, 2019 and 2018	4

Notes to Consolidated Financial Statements	5- 13

ACCSYS, INC. AND SUBSIDIARY

Consolidated Balance Sheets (Unaudited)

Assets

	September 30, 2019			December 31, 2018
Current Assets:
Cash and cash equivalents	$	339,692		$	759,297
Accounts and unbilled receivables		196,854			109,562
Employee advances		51,225			-
Prepaid expenses and other current assets		99,797			109,969
Total current assets		687,568			978,828
Property and equipment, at cost:
Office equipment		283,366			286,792
Leasehold improvements		40,500			40,500
Furniture and fixtures		25,246			25,246
Computer software		7,249			7,249
		356,361			359,787
Less accumulated depreciation and amortization		(307,827	)		(293,630	)
Net property and equipment		48,534			66,157
Other long-term asset		195,735			-
Total Assets	$	931,837		$	1,044,985

See notes to consolidated financial statements.

Page 1

ACCSYS, INC. AND SUBSIDIARY

Consolidated Balance Sheets (Unaudited) - Continued

Liabilities and Shareholders' Deficit

	September 30, 2019			December 31, 2018
Current Liabilities:
Accounts payable and other liabilities	$	530,055		$	647,770
Payroll and payroll related liabilities		207,005			249,103
Customer deposits		119,530			94,188
Customer rebates payable		61,570			68,471
Deferred revenues		507,753			965,759
Line of credit		100,000			100,000
Capital lease obligations - current portion		19,044			20,754
Note payable - current portion		89,324			-
Shareholder notes payable - current portion		30,000			30,000

Total current liabilities		1,664,281			2,176,045

Capital lease obligations, net of current portion		11,888			25,724
Note payable, net of current portion		159,389			-
Shareholder notes payable, net of current portion		4,472,600			4,495,100
Deferred liabilities - shareholders		1,734,636			1,734,636

Total liabilities		8,042,794			8,431,505

Commitments (Note 6)
Shareholders' Deficit:
Common stock, $1 par value, 1,000 shares authorized, 810 shares issued and outstanding		810			810
Additional paid-in capital		475,817			475,817
Treasury stock, 190 shares, at cost		(300,000	)		(300,000	)
Deficit		(7,287,584	)		(7,563,147	)

Total shareholders' deficit		(7,110,957	)		(7,386,520	)

Total Liabilities and Shareholders' Deficit	$	931,837		$	1,044,985

See notes to consolidated financial statements.

Page 2

ACCSYS, INC. AND SUBSIDIARY

Consolidated Statements of Operations (Unaudited)

	For the Nine Months Ended September 30,
	2019			2018
Revenues, net	$	5,741,042		$	4,532,375
Costs of revenues		2,888,555			2,409,565
Gross profit		2,852,487			2,122,810
Operating expenses		2,353,869			2,221,739
Operating income (loss)		498,618			(98,929	)
Other income (expense):
Interest income		140			213
Interest expense		(223,195	)		(145,709	)
Other expense		-			(26,636	)
Total other expense, net		(223,055	)		(172,132	)
Net income (loss)		275,563			(271,061	)
Deficit, beginning of period		(7,563,147	)		(6,871,054	)
Less distributions		-			(78,000	)
Deficit, end of period	$	(7,287,584	)	$	(7,220,115	)

See notes to consolidated financial statements.

Page 3

ACCSYS, INC. AND SUBSIDIARY

Consolidated Statements of Cash Flows (Unaudited)

	For the Nine Months Ended September 30,
	2019			2018
Cash flows from operating activities:
Net income (loss)	$	275,563		$	(271,061	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization		17,575			2,100
Loss on disposal of equipment		48			-
Provision for bad debts		1,175			21,789
Changes in assets and liabilities:
Accounts receivable		(88,467	)		222,102
Employee advances		(51,225	)		250
Prepaid expenses and other current assets		10,172			(28,744	)
Other assets		106,665			-
Accounts payable		(117,715	)		82,072
Payroll and payroll related liabilities		(42,098	)		68,937
Customer deposits		25,342			34,822
Customer rebate payable		(6,901	)		(5,250	)
Deferred revenue		(458,006	)		(427,438	)
Net cash used in operating activities		(327,872	)		(300,421	)

Cash flows from financing activities:
Distributions		-			(78,000	)
Payments on short term note payable		(53,687	)		-
Payments on shareholder note payable		(22,500	)		(30,000	)
Payments on capital lease obligations		(15,546	)		(20,736	)
Cash used in financing activities		(91,733	)		(128,736	)
Net decrease in cash and cash equivalents		(419,605	)		(429,157	)
Cash and cash equivalents, beginning of period		759,297			700,446
Cash and cash equivalents, end of period	$	339,692		$	271,289
Supplemental Disclosure of Cash Flow Information:
Cash paid for interest	$	100,147		$	107,568
Supplemental Disclosure of Noncash Investing and Financing Transactions:
Purchase of license agreement financed by note payable	$	302,400		$	-

See notes to consolidated financial statements.

Page 4

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

September 30, 2019 and 2018 and December 31, 2018

Note 1 - Description of business and summary of significant accounting policies:

Nature of business

AccSys, Inc. (d/b/a Restaurant Magic Software), ("AccSys") was initially incorporated under the laws of the state of Florida in 1979. In November 2019, AccSys converted to a limited liability company under the laws of state of Delaware. AccSys's primary product, Data Central, is a suite of back office applications designed to help restaurant managers achieve operational and financial goals. The software integrates information from customers' existing POS, inventory, supply, payroll, and accounting platforms to provide a comprehensive view of operations. Data Central is offered as Software as a Service (SaaS) to its customers. The Company is headquartered in Tampa, Florida and its customers are located throughout the United States.

Basis of presentation

The Company has have adopted the Financial Accounting Standards Board (FASB) Codification (Codification). The Codification is the single official source of authoritative accounting principles generally accepted in the United States of America (U.S. GAAP) recognized by the FASB to be applied by nongovernmental entities, and all of the Codification's content carries the same level of authority.

Basis of consolidation

The accompanying unaudited consolidated financial statements include the accounts of AccSys and its wholly-owned subsidiary, AfterWords, Inc. ("AfterWords"). AccSys and AfterWords are hereinafter collectively referred to as the "Company." In November 2019, the Company's interest in AfterWords was transferred to a separate related entity. All significant intercompany balances and transactions have been eliminated in consolidation.

Liquidity

The Company’s consolidated financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplate the realization of assets and liquidation of liabilities in the normal course of business. The Company has invested significant resources into the launch of AfterWords and as a result has significant shareholders' and working capital deficits at September 30, 2019 of approximately $7,288,000 and $2,711,000, respectively. However, a significant portion of the deficit resulted from deferred revenues of $507,753 which will not require the outlay of cash. Furthermore, in December 2019 the shareholders sold substantially all assets of the Company. All obligations due to the shareholders, including liabilities for deferred compensation and interest of $1,734,636, were paid in full upon closing of the sale. Management believes the Company will have adequate resources to meet its remaining obligations through, at a minimum, one year from the date of these consolidated financial statements.

Page 5

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

September 30, 2019 and 2018 and December 31, 2018

Note 1 - Description of business and summary of significant accounting policies - continued:

Use of estimates in the preparation of financial statements

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. The reported amounts of revenues and expenses during the reporting period may be affected by these estimates. Estimates that are critical to the accompanying consolidated financial statement relate primarily to management's belief that all of the Company's long-lived asset are recoverable and that the Company will generate adequate cash to meet its obligations. Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the period that they are determined to be necessary. Actual results could differ from these estimates.

Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of three months or less from date of purchase to be cash equivalents.

Accounts receivable and credit policies

The Company's payment terms generally require payment within 30 days. Management performs ongoing credit evaluations of the Company's customers and generally does not require collateral as management believes the Company has collection measures in place to limit the potential for significant losses. The Company maintains allowances for doubtful accounts, when applicable, for estimated losses resulting from the inability of its customers to make required payments. Management considers the following factors when determining the collectibility of specific customer accounts: customer creditworthiness, past transaction history with the customer, current economic industry trends, and changes in customer payment terms. Balances that remain outstanding after the Company has made reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable. Substantially all of the Company's receivables were recovered subsequent to September 30, 2019 and December 31, 2018; accordingly, no allowance for doubtful accounts was deemed necessary as of such dates.

Revenue and cost recognition

Page 6

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

September 30, 2019 and 2018 and December 31, 2018

Note 1 - Description of business and summary of significant accounting policies - continued:

Property and equipment

Property and equipment includes leased assets having a cost of $62,672 and $66,097 and net book value of $29,698 and $46,478 at September 30, 2019 and December 31, 2018, respectively. Depreciation and amortization for the nine-month periods ended September 30, 2019 and 2018 was $17,575 and $2,100, respectively.

Other long-term asset

Other long-term asset consists an up-front payment for the cloud services portion of a license agreement in the amount of $332,400. The agreement allows for consumption-based billing and as such the up-front payment is utilized based on actual usage. For nine month period ended September 30, 2019 the company has utilized $136,665.

Page 7

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

September 30, 2019 and 2018 and December 31, 2018

Note 1 - Description of business and summary of significant accounting policies - continued:

Impairment of long-lived assets

The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. At September 30, 2019, management believes all of the Company’s long-lived assets are recoverable.

Income taxes

Because AccSys and AfterWords were Subchapter S Corporations as of September 30, 2019 and December 31, 2018, the Company is not subject to income taxes; rather, the results of its operations flow through to the Company’s shareholders for inclusion in their personal income tax returns. Accordingly, these consolidated financial statements do not include any provision for income taxes.

Advertising costs

Advertising costs, which are expensed as incurred, totaled $401,835 and $164,665 for the nine

months ended September 30, 2019 and 2018, respectively, and is included in operating expenses on the consolidated statement of operations.

Internally developed software

Page 8

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

September 30, 2019 and 2018 and December 31, 2018

Note 1 - Description of business and summary of significant accounting policies - continued:

Date of management's review and other subsequent events

Management has evaluated events and transactions subsequent to September 30, 2019 for potential recognition or disclosure through January 30, 2020, which is the date the consolidated financial statements were available to be issued. Significant subsequent events were as follows:

•

In November 2019, shareholder interests in AfterWords were spun off to a new legal entity not subject to consolidation. Loans due to the Company from the former subsidiary of approximately $3,240,000 (such amounts were eliminated in consolidation as of September 30, 2019 and December 31, 2018) were distributed to the shareholders as part of the transaction noted below.

•

In December 2019, substantially all of the Company's assets were sold to an independent third party. In connection with the transaction, shareholder notes payable, the line of credit and the amounts due to related parties included in the accompanying consolidated balance sheet, were paid.

Note 2 - Note payable:

Note payable consists of the following:

	September 30, 2019			December 31, 2018
Note payable, collateralized by the right to use software and services financed by the agreement, due in monthly installments of $9,372, including interest at 7.25%, through March 2022.	$	248,713		$	-
Less: current portion		(89,324	)		-
Long-term portion	$	159,389		$	-

Page 9

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

September 30, 2019 and 2018 and December 31, 2018

Note 2 - Notes payable - continued:

Future minimum payments of the note payable are as follows:

Twelve months ending September 30,
2020	$	89,324
2021		104,328
2022		55,061
	$	248,713

Note 3 - Line of credit:

Prior to its satisfaction and cancellation in December 2019, advances under the line of credit were secured by substantially all of the Company's assets, and accrued interest at a rate of prime plus 4.75% (maximum borrowings of $100,000 were available).

Note 4 - Shareholder notes payable:

	September 30, 2019		December 31, 2018

Notes with interest only payments made on an annual basis. Prior to their satisfaction in December 2019, the notes accrued interest at a rate of 4.5%, were due in 2021 and secured by a second interest in substantially all of the Company's assets and intellectual property.	$	4,130,000	$	4,130,000

Notes with interest only payments made on an annual basis. Prior to their satisfaction in December 2019, the notes accrued interest at a rate of 5%, were due in 2021 and secured by a second interest in substantially all of the Company's assets and intellectual property.		215,100		215,100

Unsecured note payable to former shareholder that prior to its satisfaction in December 2019 was due in quarterly principal payments of $7,500 plus interest at a fixed rate of 3.25%.		157,500		180,000

Shareholder notes payable	$	4,502,600	$	4,525,100

Page 10

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

September 30, 2019 and 2018 and December 31, 2018

Note 4 - Shareholder notes payable - continued:

Interest expensed and paid under the above mentioned notes approximated $202,000 and $100,100, respectively, for the nine months ended September 30, 2019. Interest expensed and paid under the above mentioned notes approximated $147,700 and $107,600, respectively, for the nine months ended September 30, 2018. These amounts include $60,200 and $35,100 of interest expensed and paid to the former shareholder. Accrued interest under the above mentioned notes was $405,600 and $303,736 as of September 30, 2019 and December 31, 2018, respectfully, and is included in the balance of accounts payable and other liabilities for reporting purposes.

Future minimum payments for shareholder notes payable are as follows:

Twelve months ending September 30,
2020	$	30,000
2021		30,000
2022		4,375,100
2023		30,000
2024		30,000
Thereafter		7,500
Total shareholder notes payable		4,502,600
Less current portion		30,000
Shareholder notes payable - non current	$	4,472,600

Note 5 - Capital leases:

Page 11

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

September 30, 2019 and 2018 and December 31, 2018

Note 5 - Capital leases - continued:

Future minimum payments under these leases are as follows: Twelve months ending September 30,
2020	$	20,721
2021		11,938
2022		378
Total future minimum lease payments		33,037
Less amount representing interest		2,105
Total present value of minimum lease payments		30,932
Less current portion		19,044
Present value of minimum lease payments	$	11,888

Note 6 - Commitments:

On November 7, 2017 the Company entered into an operating lease that expires October 31, 2021 for office space in Tampa, Florida.

Minimum future lease payments are as follows:

Twelve months ending September 30,

2020	$	215,628
2021		222,097
2022		18,553
Total	$	456,278

Rent expense was $202,021 and $137,324 for the nine months ended September 30, 2019 and 2018, respectively.

Page 12

ACCSYS, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements - Continued

September 30, 2019 and 2018 and December 31, 2018

Note 7 - Employee benefit plan:

Note 8 - Concentrations of credit risk:

Two and four customers accounted for approximately 33% and 28% of the Company's accounts receivable as of September 30, 2019 and December 31, 2018, respectively. Four customers accounted for approximately 38% and 27% of the Company's revenues, respectively, for the nine months ended September 30, 2019 and 2018.

Note 9 - Deferred liabilities - shareholders:

At September 30, 2019 and December 31, 2018, the Company owed aggregate deferred compensation payable of approximately $1,211,500 for services rendered prior to March 7, 2015 and deferred interest of $523,100 on outstanding loans to two of its shareholders.

Page 13

Exhibit 99.3

Unaudited pro forma condensed combined financial information

On December 19, 2019, PAR Technology Corporation (the “Company”) filed a Current Report on Form 8-K (the “Original 8-K”) disclosing that ParTech, Inc. (“ParTech”), a wholly owned subsidiary of the Company, had completed the acquisition of AccSys, LLC (f/k/a AccSys, Inc., and otherwise known as Restaurant Magic (“Restaurant Magic”)) on December 18, 2019 (“the Acquisition”) pursuant to the terms of an interest purchase agreement dated November 7, 2019. The unaudited pro forma condensed combined financial information included in this Current Report on Form 8-K/A amends and supplements the Original 8-K to include the financial statements of Restaurant Magic and the pro forma financial information required in connection with the Acquisition.

The following unaudited pro forma condensed combined financial statements and related notes have been prepared by combining the historical condensed consolidated financial statements of the Company and Restaurant Magic and adjusted to give effect to the Acquisition. The unaudited pro forma condensed combined consolidated balance sheet as of September 30, 2019 gives effect to the Acquisition as if it occurred on that date. The unaudited pro forma condensed combined consolidated statements of operations for the nine months ended September 30, 2019 and for the year ended December 31, 2018 give effect to the Acquisition as if it occurred on January 1, 2018.

The Company accounted for the Acquisition as a business combination using the acquisition method of accounting as prescribed in Accounting Standards Codification 805, Business Combinations (“ASC 805”) and ASC 820 – Fair Value Measurements and Disclosures (“ASC 820”). In accordance with ASC 805 and ASC 820, the Company used its best estimates and assumptions to accurately assign fair value to the tangible and identifiable intangible assets acquired and liabilities assumed as of the closing date of the Acquisition. Goodwill as of the closing date is measured as the excess of the aggregate of the fair value of consideration transferred and the fair value of noncontrolling interest in the target over the fair values of tangible and identifiable intangible assets acquired and liabilities assumed.

The fair values assigned to Restaurant Magic’ tangible and identifiable intangible assets acquired and liabilities assumed are based on management’s estimates and assumptions. The estimated fair values of these assets acquired, and liabilities assumed are considered preliminary and are based on the information that was available as of the closing date of the Acquisition. The preliminary estimated fair values of tangible and identifiable intangible assets acquired and liabilities assumed may be subject to change as additional information is received. Thus, the provisional measurements of fair value are subject to change. The Company expects to finalize the valuation as soon as practicable, but not later than one year from the closing date.

The unaudited pro forma condensed combined consolidated financial information is based upon, and should be read in conjunction with:

• The accompanying notes to the unaudited pro forma condensed combined consolidated financial statements;

• The Company’s audited consolidated financial statements and accompanying notes as of and for the fiscal years ended December 31, 2018 and 2017 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on March 18, 2019;

• The Company’s unaudited consolidated financial statements and accompanying notes as of and for the three and nine-month period ended September 30, 2019 and 2018 included in the Company’s Quarterly Report on Form 10-Q filed with the SEC on November 8, 2019;

• Restaurant Magic’s audited consolidated financial statements for the year ended December 31, 2018 included elsewhere in the Current Report on Form 8-K/A; and

• Restaurant Magic’s unaudited financial statements for the nine months ended September 30, 2019 and 2018 included elsewhere in the Current Report on Form 8-K/A.

	September 30, 2019 (unaudited) (in thousands)
Assets	PAR Technology Corp			AccSys, Inc (Restaurant Magic)			Pro Forma Adjustment			Note Ref	Pro Forma Combined
Current assets:
Cash and cash equivalents	$	46,947		$	340			(13,000	)	A	$	34,287
Accounts receivable – net		28,563			—							28,563
Inventories – net		19,081			197							19,278
Asset held for sale		3,350			—							3,350
Other current assets		5,185			151							5,336
Total current assets		103,126			688			(13,000	)			90,814
Property, plant and equipment – net		14,736			49							14,785
Goodwill		13,418			—			28,244		M		41,662
Intangible assets – net		13,895			—			18,500		N		32,395
Lease right-of-use assets		2,999			—			437		L		3,436
Other assets		4,395			195							4,590
Total Assets	$	152,569		$	932		$	34,181			$	187,682
Liabilities and Shareholders’ Equity
Current liabilities:
Note Payable	$	—		$	89		$	683		F	$	772
Borrowings of line of credit		—			100			(100	)	J		—
Accounts payable		8,929			530			—				9,459
Accrued salaries and benefits		7,419			207			—				7,626
Accrued expenses		3,095			—			568		B		3,663
Customer deposits and deferred service revenue		10,823			689			—				11,512
Lease liabilities - current portion		1,182			—			202		L		1,384
Shareholder Note Payable, current portion					30			(30	)	I		—
Liability held for sale		511			—			—				511
Other current liabilities		—			19			—				19
Total current liabilities		31,959			1,664			1,323				34,946
Deferred Liabilities					1,735			(1,735	)	I		—
Lease liabilities - net of current portion		1,866						235		L		2,101
Deferred revenue – noncurrent		4,148										4,148
Contingent Liability								3,970		G		3,970
Long-term debt		60,137			4,632			(3,155	)	F / H		61,614
Other long-term liabilities		3,903			12							3,915
Total liabilities		102,013			8,043			638				110,694
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; 18,053,477 and 17,879,761 shares issued, 16,345,368 and 16,171,652 outstanding at September 30, 2019 and December 31, 2018, respectively		362			1			17		K/E		380
Capital in excess of par value		64,832			476			26,506		E/D		91,814
(Accumulated deficit) retained earnings		(4,313	)		(7,288	)		6,720		C/B		(4,881	)
Accumulated other comprehensive loss		(4,489	)									(4,489	)
Treasury stock, at cost, 1,708,109 shares		(5,836	)		(300	)		300		O		(5,836	)
Total shareholders’ equity		50,556			(7,111	)		33,543				76,988
Total Liabilities and Shareholders’ Equity	$	152,569		$	932		$	34,181			$	187,682

	Twelve Months Ended December 31, 2018 (unaudited) (in thousands)
	PAR Technology Corp			AccSys, Inc (Restaurant Magic)			Pro Forma Adjustment			Note Ref	Pro Forma Combined
Net revenues:
Product	$	78,787		$	—		$	—			$	78,787
Service		55,282			6,118			—				61,400
Contract		67,177			—			—				67,177
		201,246			6,118			—				207,364
Costs of sales:
Product		60,694			—			—				60,694
Service		42,107			3,349			(1,796	)	A, E		43,660
Contract		59,982			—			—				59,982
		162,783			3,349			(1,796	)			164,336
Gross margin		38,463			2,769			1,796				43,028
Operating expenses:
Selling, general and administrative		34,983			3,158			667		H		38,808
Research and development		12,412			—			1,616		A		14,028
Amortization of identifiable intangible assets		966			—			2,514		D		3,480
		48,361			3,158			4,797				56,316
Operating loss		(9,898	)		(389	)		(3,001	)			(13,288	)
Other (expense) income, net		306			(27	)		—		—		279
Interest expense, net		(387	)		(199	)		138		B, C		(448	)
Loss before provision for income taxes		(9,979	)		(615	)		(2,863	)			(13,457	)
Provision for income taxes		(14,143	)		—			—		F		(14,143	)
Net loss		(24,122	)		(615	)		(2,863	)			(27,600	)
Discontinued operations
Income from discontinued operations (net of tax)		—			—			—				—
Net loss	$	(24,122	)	$	(615	)	$	(2,863	)		$	(27,600	)
Basic Earnings per Share:
Net loss		(1.50	)									(1.63	)
Diluted Earnings per Share:
Net loss		(1.50	)									(1.63	)
Weighted average shares outstanding
Basic		16,041						908		G		16,949
Diluted		16,041						908		G		16,949

	Nine Months Ended September 30, 2019 (unaudited) (in thousands)
	PAR Technology Corp			AccSys, Inc (Restaurant Magic)			Pro Forma Adjustment			Note Ref	Pro Forma Combined
Net revenues:
Product	$	46,149		$	—		$	—			$	46,149
Service		41,514			5,741			—				47,255
Contract		46,646			—			—				46,646
		134,309			5,741			—				140,050
Costs of sales:
Product		34,912			—			—				34,912
Service		29,144			2,889			(1,630	)	A / E		30,403
Contract		42,679			—			—				42,679
		106,735			2,889			(1,630	)			107,994
Gross margin		27,574			2,852			1,630				32,056
Operating expenses:
Selling, general and administrative		27,162			2,354			500		H		30,016
Research and development		9,233			—			1,495		A		10,728
Amortization of identifiable intangible assets		724			—			1,886		D		2,610
		37,119			2,354			3,881				43,354
Operating loss		(9,545	)		498			(2,251	)			(11,298	)
Other (expense) income, net		(1,205	)		—			—		—		(1,205	)
Interest expense, net		(2,978	)		(223	)		177		B / C		(3,024	)
Loss before benefit from (provision for) income taxes		(13,728	)		275			(2,074	)			(15,527	)
Benefit from (provision for) income taxes		3,988			—			—		F		3,988
Net loss		(9,740	)		275			(2,074	)			(11,539	)
Discontinued operations
Income from discontinued operations (net of tax)		—			—							—
Net loss	$	(9,740	)	$	275		$	(2,074	)		$	(11,539	)
Basic Earnings per Share:
Net loss		(0.61	)									(0.68	)
Diluted Earnings per Share:
Net loss		(0.61	)									(0.68	)
Weighted average shares outstanding
Basic		16,086						908		G		16,994
Diluted		16,086						908		G		16,994

1. Basis of Presentation

The accompanying unaudited pro forma condensed combined consolidated financial information presents the pro forma condensed combined consolidated balance sheet and statements of operations of the combined Company based upon the financial statements of the Company and Restaurant Magic after giving effect to the Acquisition.

The unaudited pro forma condensed combined consolidated statements of operations for the twelve months ended December 31, 2018 and for the nine months ended September 30, 2019 combine the historical consolidated statements of operations of the Company and the historical consolidated statements of operations of Restaurant Magic. These unaudited pro forma condensed combined consolidated statements of operations give effect to the Acquisition as if it had been consummated on January 1, 2018, the beginning of the earliest period presented. The unaudited pro forma condensed combined consolidated balance sheet combines the historical condensed consolidated balance sheet of the Company and the historical condensed consolidated balance sheet of Restaurant Magic as of September 30, 2019, giving effect to the Acquisition as if it had been consummated on September 30, 2019.

The unaudited pro forma condensed combined consolidated financial statements were prepared using the acquisition method of accounting with the Company considered the acquirer of Restaurant Magic. Under the acquisition method of accounting, the purchase price is allocated to the underlying tangible and intangible assets acquired and liabilities assumed with any excess allocated to goodwill. The pro forma purchase price allocation was based on an estimate of the fair market value of the tangible and intangible assets acquired and liabilities assumed of Restaurant Magic.

The unaudited pro forma condensed combined consolidated financial statements do not reflect the costs of any integration activities or benefits that may result from the realization of future cost savings from operating efficiencies or revenue synergies expected to result from the Acquisition.

The Company adopted FASB ASC Topic 606; Revenue from Contracts with Customers (ASC 606), on January 1, 2018. Restaurant Magic as a private company is not required to adopt ASC 606 until its December 31, 2019 financial statements and as such, the Company has performed a preliminary review of Restaurant Magic’s revenue streams in order to determine if any pro forma adjustments were necessary for the nine months ended September 31, 2019 and the year ended December 31, 2018. No adjustments were deemed necessary to conform Restaurant Magic’s revenue to the Company’s revenue policy.

2. Preliminary Purchase Price

The preliminary purchase price for the Acquisition was $45.97 million (the “Purchase Price”) as follows (in thousands):

Purchase Price	Amount
Cash Consideration	$	13,000
Note Consideration		2,000
Equity Consideration		27,000
Closing Consideration	$	42,000

Contingent Consideration
Fair Value of Annual Recurring Revenue (“ARR”) Earnout	$	3,210
Fair Value of Royalty Earnout		760
Total Fair Value of Contingent Consideration	$	3,970

Total Consideration	$	45,970

The Purchase Price excludes $2.0 million of restricted stock units issued in connection with the Company’s assumption of Restaurant Magic’s long term incentive plan (the “RM Incentive Plan”) established prior to the closing of the Acquisition. The restricted stock units will vest in equal annual installments over three (3) years, subject to continued service requirements. The Company will record this as compensation over the vesting period.

3. Preliminary Allocation of Purchase Price

Under the purchase acquisition method of accounting, the Purchase Price is allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values as of the closing of the Acquisition. The residual amount of the Purchase Price after preliminary allocation to identifiable tangible and intangible assets acquired and liabilities assumed has been allocated to goodwill.

The Company has performed a preliminary valuation analysis of the fair market value of Restaurant Magic’s assets acquired and liabilities assumed. Using the total consideration for the Acquisition, the Company has estimated the allocations to such assets and liabilities, with the assistance based on the report of an independent valuation specialist. The Company has not completed the detailed valuation studies necessary to arrive at the required fair values of Restaurant Magic’s assets acquired and liabilities assumed. Therefore, the following allocation of the Purchase Price to acquired assets and assumed liabilities is based on preliminary fair value estimates and subject to final management analysis, with the assistance of third party valuation advisors.

The following table summarizes the allocation of the preliminary Purchase Price as of the closing date (in thousands):

Purchase Price Allocation:	Amount
Current Assets	$	688
Property Plant & Equipment		49
Other Assets		195
Indefinite-lived intangible assets		18,500
Goodwill		28,244
Total Assets Acquired	$	47,676

Current Liabilities	$	1,535
Other Long-Term liabilities		171
Total liabilities assumed	$	1,706

Net Assets acquired	$	45,970

4. Pro Forma Adjustments

The unaudited pro forma financial information is not necessarily indicative of what the financial position actually would have been had the Acquisition been completed at the date indicated. Such information includes adjustments that are preliminary and may be revised. Such revisions may result in material changes. The financial position shown herein is not necessarily indicative of what the past financial position of the companies would have been on a consolidated basis.

The following describes the pro forma adjustments related to the Acquisition that have been made in the accompanying unaudited pro forma condensed combined consolidated statements of operations for the nine months ended September 30, 2019 and for the year ended December 31, 2018, which have been prepared to reflect the Acquisition for the net purchase price of $45.97 million and assumed the RM Incentive Plan of $2.0 million, if the Acquisition was completed on January 1, 2018, for statements of operations purposes and reflect the following pro forma adjustments:

Balance Sheet Pro Forma Adjustments:

A - The adjustment reflects the cash consideration of the Purchase Price.

B - The adjustment reflects an accrual for transaction costs for the Acquisition that were incurred after September 30, 2019.

C- The adjustment relates to the elimination of Restaurant Magic’s $7.3 million retained earnings.

D- The adjustment relates to the elimination of Restaurant Magic’s $0.5 million additional paid in capital.

E - The adjustment reflects the $27 million increase in shares of Company common stock outstanding due to the 908,192 shares issued to Restaurant Magic’s stockholders as part of the Purchase Price.

F - The adjustment relates to the $2 million note payable to Restaurant Magic’s stockholders as part of the Purchase Price. $0.7 million is current and $1.3 million is reflected as long-term.

G- The adjustment relates to the current valuation of the contingent liability for potential earnout.

H - The adjustment reflects the elimination of Restaurant Magic's historical shareholder payable of $4.5 million as part of the transaction consideration.

I- The adjustment reflects the elimination of Restaurant Magic's historical related party (deferred payable - shareholders) payable as part of the transaction consideration.

J - The adjustment reflects the elimination of Restaurant Magic's historical line of credit as part of the transaction consideration.

K - The adjustment reflects the elimination of Restaurant Magic's historical common stock as part of the transaction consideration.

L - The adjustment represents the estimated adjustment to record Restaurant Magic's lease obligations consistently with the Company's lease obligations in accordance with ASC 842 Leases.

M - Reflects the recognition of goodwill related to the Acquisition. Goodwill is calculated as the difference between the fair value of the consideration transferred and the values assigned to the identifiable tangible and intangible assets acquired and liabilities assumed. The estimated goodwill calculation is preliminary and is subject to change based upon final determination of the fair value of assets acquired and liabilities assumed. Goodwill is not amortized, but is assessed at least annually or more frequently if events or changes in circumstances indicate that the carrying value of the goodwill may not be recoverable based on management's assessment.

N - The identifiable intangible assets consist of trade name ($ 0.9 million), customer relationships ($1.2 million) and developed technology ($16.4 million). The trade names valuation utilized the “relief from royalty” approach, a form of the income approach, whereby the fair value of an asset is developed by attributing the savings incurred from not having to pay a royalty for the use of the asset. The customer relationship valuation utilized the “multi-period excess earnings method,” which is predicated upon the calculation of the net present value of the after-tax net cash flows attributable to the customers over the expected remaining life of the relationships. The developed technology valuation also utilized the “multi-period excess earnings method”. The preliminary estimated useful life of these identifiable intangible assets is approximately (i) indefinite for the trade names, (ii) 7 years for the customer relationships and (iii) 7 years for the developed technology. The preliminary purchase price allocation assumed the historical carrying value of such assets received along with the liabilities assumed will approximate fair value due to their short-term nature. The underlying assumptions used to prepare the discounted cash flow analysis used in these estimates may change. For these and other reasons, actual results may vary significantly from estimated results.

O - The adjustment relates to the elimination of Restaurant Magic’s $0.3 million treasury stock.

Statement of Operations Pro Forma Adjustments:

A. Adjustments have been included in the unaudited pro forma condensed combined consolidated statements of operations for the nine months ended September 30, 2019 ($1.5 million)and year ended December 31, 2018 ($1.6 million) to reflect reclass of R&D costs from Cost of Sales to Research & Development Operating Expenses to be consistent with the Company’s treatment of Research and Development costs.

B. Adjustments have been included in the unaudited pro forma condensed combined consolidated statements of operations for the nine months ended September 30, 2019 and year ended December 31, 2018 to remove interest expense related Restaurant Magic indebtedness that was eliminated as part of the transaction.

C. Adjustments have been included in the unaudited pro forma condensed combined consolidated statements of operations for the nine months ended September 30, 2019 ($0.1 million) and year ended December 31, 2018 ($0.1 million) to include interest expense (used 5.75%) related to the $2 million 3 year promissory note issued by the Company as part of the transaction consideration.

D. Adjustments have been included in the unaudited pro forma condensed combined consolidated statements of operations for the nine months ended September 30, 2019 ($1.9 million) and year ended December 31, 2018 ($2.5 million) to include amortization expense related to the identifiable intangible assets purchased as part of the transaction.

E. Adjustments have been included in the unaudited pro forma condensed combined consolidated statements of operations for the nine months ended September 30, 2019 ($0.1 million) and year ended December 31, 2018 ($0.2 million) to remove Research & Development costs dedicated to AfterWords, Inc (“AfterWords”) that was eliminated as part of the transaction consideration. AfterWords was a wholly-owned subsidiary of Restaurant Magic that was excluded from the Acquisition.

F. There are no tax provision adjustments as the Company has been in a full valuation allowance position since 2018.

G. Adjustments have been included in the unaudited pro forma condensed combined consolidated statements of operations for the nine months ended September 30, 2019 and year ended December 31, 2018 to include the weighted shares outstanding of the pro forma adjustments to reflect the $27 million of equity consideration as part of the transaction.

H - Adjustments have been included in the unaudited pro forma condensed combined consolidated statements of operations for the nine months ended September 30, 2019 ($0.5 million) and year ended December 31, 2018 ($0.7 million) to reflect increase in equity compensation due to the granting of $2 million of 3 year time vested restricted stock units under the RM Incentive Plan.

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

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock	PAR	New York Stock Exchange

	Exhibit No.		Exhibit Description
	23.1		Consent of BDO USA, LLP.
	99.1		Audited financial statements of AccSys, Inc. for the year ended December 31, 2018.
	99.2		Unaudited financial statements of AccSys, Inc. for the nine months ended September 30, 2018 and September 30, 2019.
	99.3		Unaudited pro forma condensed combined consolidated balance sheet of PAR Technology Corporation as of September 30, 2019 and unaudited pro forma condensed combined consolidated statements of operations of PAR Technology Corporation for the year ended December 31, 2018 and the nine months ended September 30, 2019.

	PAR TECHNOLOGY CORPORATION
	(Registrant)

Date: February 3, 2020	/s/ Bryan A. Menar
	Bryan A. Menar
	Chief Financial and Accounting Officer
	(Principal Financial Officer)