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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 
For the Quarterly Period Ended September 30, 2024
OR
☐ TRANSITION REPORT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the Transition Period From __________ to __________
Commission File Number: 1-09720
New PAR Logo.jpg
PAR TECHNOLOGY CORPORATION
(Exact name of registrant as specified in its charter)

Delaware16-1434688
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
 
PAR Technology Park, 8383 Seneca Turnpike, New Hartford, New York 13413-4991
(Address of principal executive offices, including zip code)
(315) 738-0600
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, $0.02 par valuePARNew York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☑
Accelerated Filer ☐
Non-Accelerated Filer ☐
Smaller Reporting Company ☐
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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of November 7, 2024, 36,305,087 shares of the registrant’s common stock, $0.02 par value, were outstanding.


PAR TECHNOLOGY CORPORATION
TABLE OF CONTENTS
PART I
FINANCIAL INFORMATION
Item
Number		DescriptionPage
   
Item 1.
   
 
   
 
   
 
   
 
   
 
   
Item 2.
   
Item 3.
   
Item 4.
PART II
OTHER INFORMATION
Item 1.
   
Item 1A.
   
Item 2.
Item 5.
   
Item 6.
   

“PAR®,” “PAR POS®” (formerly “Brink POS®”), “Punchh®,” “PAR OrderingTM” (formerly “MENUTM”), “Data Central®,” "Open Commerce®,” "PAR® Pay”, “PAR® Payment Services”, "StuzoTM," "PAR RetailTM," and other trademarks identifying our products and services appearing in this Quarterly Report belong to us. This Quarterly Report may also contain trade names and trademarks of other companies. Our use of such other companies’ trade


names or trademarks is not intended to imply any endorsement or sponsorship by these companies of us or our products or services.

Unless the context indicates otherwise, references in this Quarterly Report to "we," "us," "our," the "Company," and "PAR" mean PAR Technology Corporation and its consolidated subsidiaries.

FORWARD-LOOKING STATEMENTS

This Quarterly Report contains “forward-looking statements” within the meaning of Section 21E of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not historical in nature, but rather are predictive of PAR's future operations, financial condition, financial results, business strategies and prospects. Forward-looking statements are generally identified by words such as “believe,” “could”, “continue,” “expect,” “estimate,” “future”, “may,” “will,” “would,” and similar expressions.

Forward-looking statements are based on management's current expectations and assumptions and are inherently uncertain. Actual results and outcomes could differ materially from those expressed in or implied by forward-looking statements, including statements relating to and PAR's expectations regarding:
•the plans, strategies and objectives of management for future operations, including PAR’s service and product offerings, its go-to-market strategies and the expected development, demand, performance, market share, or competitive performance of its products and services;
•PAR's ability to achieve and sustain profitability;
•projections of net revenue, margins, expenses, cash flows, or other financial items;
•PAR's annual recurring revenue, active sites, subscription service margins, net loss, net loss per share, and other key performance indicators and non-GAAP financial measures;
•PAR's expectations about the availability and terms of product and component supplies for our hardware;
•the timing and expected benefits of acquisitions, divestitures, and capital markets transactions;
•PAR’s human capital strategies and engagement;
•current or future macroeconomic trends or geopolitical events and the impact of those trends and events on PAR and its business, financial condition, and results of operations;
•claims, disputes, or other litigation matters; and
•assumptions underlying any of the foregoing.

Factors, risks, trends, and uncertainties that could cause PAR’s actual results to differ materially from those expressed in or implied by forward-looking statements include:
•PAR's ability to successfully develop or acquire and transition new products and services and enhance existing products and services to meet evolving customer needs and respond to emerging technological trends, including artificial intelligence;
•PAR's ability to add and maintain active sites, retain and manage suppliers, secure alternative suppliers, and manage inventory levels, navigate manufacturing disruptions or logistics challenges, shipping delays and shipping costs;
•the effects, costs and timing of acquisitions, divestitures, and capital markets transactions;
•PAR's ability to integrate acquisitions into its operations and the timing, complexity and costs associated with integrations, including the acquisitions of Stuzo Holdings, LLC and TASK Group Holdings Limited;
•macroeconomic trends, such as a recession or slowed economic growth, fluctuating interest rates, inflation, and changes in consumer confidence and discretionary spending;
•geopolitical events, such as effects of the Russia-Ukraine war, tensions with China and between China and Taiwan, hostilities in the Middle East, including the Israel conflict(s), and uncertainty relating to the U.S. presidential transition and the Trump administration's policies and regulations, including potential changes to trade agreements or tariffs;
•PAR's ability to successfully attract, develop and retain necessary qualified employees to develop and expand its business, execute product installations and respond to customer service level needs;
•the protection of PAR's intellectual property;
•PAR's ability to retain and add integration partners, and its success in acquiring and developing relevant technology for current, new, and potential customers for its service and product offerings;
•risks associated with PAR's international operations;
•PAR’s ability to generate sufficient cash flow or access additional financing sources as needed to repay its outstanding debts, including amounts owed under its outstanding convertible notes and credit facility;

•the effects of global pandemics, such as COVID-19 or other public health crises;
•changes in estimates and assumptions PAR makes in connection with the preparation of its financial statements, or in building its business and operational plans and in executing PAR's strategies;
•disruptions in operations from data breaches and cyberattacks, including heightened risks due to the rapid development and adoption of artificial intelligence technologies globally;
•PAR's ability to maintain proper and effective internal control over financial reporting;
•PAR's ability to execute its business, operational plans, and strategies and manage its business continuity risks, including disruptions or delays in product assembly and fulfillment;
•potential impacts, liabilities and costs from pending or potential investigations, claims and disputes; and
•other factors, risks, trends and uncertainties disclosed in our filings with the Securities and Exchange Commission ("SEC"), particularly those listed under the heading "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, in our Quarterly Report for the quarter ended March 31, 2024, and in this Quarterly Report.

Given these risks and uncertainties, readers are cautioned not to place undue reliance on forward-looking statements. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities law.


PART I – FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS (unaudited)
PAR TECHNOLOGY CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
(unaudited)
AssetsSeptember 30, 2024December 31, 2023
Current assets:  
Cash and cash equivalents$105,804 $37,183 
Cash held on behalf of customers15,266 10,170 
Short-term investments12,578 37,194 
Accounts receivable – net60,298 42,679 
Inventories23,915 23,560 
Other current assets14,743 8,123 
Current assets of discontinued operations— 21,690 
Total current assets232,604 180,599 
Property, plant and equipment – net14,865 15,524 
Goodwill803,084 488,918 
Intangible assets – net226,051 93,969 
Lease right-of-use assets7,651 3,169 
Other assets15,019 17,642 
Noncurrent assets of discontinued operations— 2,785 
Total Assets$1,299,274 $802,606 
Liabilities and Shareholders’ Equity  
Current liabilities:  
Accounts payable$35,186 $25,599 
Accrued salaries and benefits17,959 14,128 
Accrued expenses8,309 3,533 
Customers payable15,266 10,170 
Lease liabilities – current portion2,178 1,120 
Customer deposits and deferred service revenue30,444 9,304 
Current liabilities of discontinued operations— 16,378 
Total current liabilities109,342 80,232 
Lease liabilities – net of current portion5,559 2,145 
Long-term debt466,735 377,647 
Deferred service revenue – noncurrent1,733 4,204 
Other long-term liabilities23,198 3,603 
Noncurrent liabilities of discontinued operations— 1,710 
Total liabilities606,567 469,541 
Shareholders’ equity:  
Preferred stock, $0.02 par value, 1,000,000 shares authorized
— — 
Common stock, $0.02 par value, 116,000,000 shares authorized, 37,773,764 and 29,386,234 shares issued, 36,303,459 and 28,029,915 outstanding at September 30, 2024 and December 31, 2023, respectively
749 584 
Additional paid in capital972,811 625,154 
Accumulated deficit(258,886)(274,956)
Accumulated other comprehensive loss(118)(939)
Treasury stock, at cost, 1,470,305 shares and 1,356,319 shares at September 30, 2024 and December 31, 2023, respectively
(21,849)(16,778)
Total shareholders’ equity692,707 333,065 
Total Liabilities and Shareholders’ Equity$1,299,274 $802,606 

See accompanying notes to unaudited interim condensed consolidated financial statements
3
PAR TECHNOLOGY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(unaudited)

Three Months Ended
September 30,		Nine Months Ended
September 30,
2024202320242023
Revenues, net:  
Subscription service$59,909 $31,363 $143,160 $89,700 
Hardware22,650 25,824 60,992 78,991 
Professional service14,195 11,514 40,825 38,123 
Total revenues, net96,754 68,701 244,977 206,814 
Cost of sales:  
Subscription service26,789 15,497 66,424 46,655 
Hardware16,878 19,295 46,587 63,002 
Professional service10,056 8,775 30,849 31,925 
Total cost of sales53,723 43,567 143,860 141,582 
Gross margin43,031 25,134 101,117 65,232 
Operating expenses:  
Sales and marketing10,500 9,532 31,237 29,005 
General and administrative27,352 17,525 77,896 52,926 
Research and development17,821 14,660 49,826 43,863 
Amortization of identifiable intangible assets2,699 464 5,577 1,393 
Adjustment to contingent consideration liability— — (600)(7,500)
Gain on insurance proceeds(147)— (147)(500)
Total operating expenses58,225 42,181 163,789 119,187 
Operating loss(15,194)(17,047)(62,672)(53,955)
Other expense, net(1,400)(262)(1,710)(116)
Interest expense, net(3,417)(1,750)(6,755)(5,152)
Loss from continuing operations before (provision for) benefit from income taxes(20,011)(19,059)(71,137)(59,223)
(Provision for) benefit from income taxes(653)(175)6,520 (873)
Net loss from continuing operations(20,664)(19,234)(64,617)(60,096)
Net income from discontinued operations832 3,718 80,687 8,973 
Net income (loss)$(19,832)$(15,516)$16,070 $(51,123)
Net income (loss) per share (basic and diluted):
Continuing operations$(0.58)$(0.70)$(1.90)$(2.19)
Discontinued operations0.02 0.14 2.38 0.33 
Total$(0.56)$(0.56)$0.48 $(1.86)
Weighted average shares outstanding (basic and diluted)35,86527,47233,93127,412

See accompanying notes to unaudited interim condensed consolidated financial statements



4
PAR TECHNOLOGY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(In thousands)
(unaudited)

Three Months Ended September 30,Nine Months Ended September 30,
2024202320242023
Net income (loss)$(19,832)$(15,516)$16,070 $(51,123)
Other comprehensive income (loss), net of applicable tax:
Foreign currency translation adjustments3,790 1,417 821 (142)
Comprehensive income (loss)$(16,042)$(14,099)$16,891 $(51,265)

See accompanying notes to unaudited interim condensed consolidated financial statements
5
PAR TECHNOLOGY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(In thousands)
(unaudited)

Common StockAdditional
Paid in
Capital		Accumulated DeficitAccumulated
Other
Comprehensive
Loss		Treasury StockTotal
Shareholders’
Equity
SharesAmountSharesAmount
Balances at December 31, 202329,386 $584 $625,154 $(274,956)$(939)1,356 $(16,778)$333,065 
Issuance of common stock upon the exercise of stock options107 2 1,103 — — — — 1,105 
Net issuance of restricted stock awards and restricted stock units329 4 (4)— — — — — 
Issuance of common stock for acquisition (see Note 3)442 9 19,161 — — — — 19,170 
Proceeds from private placement of common stock, net of issuance costs of $5.5 million
5,175 104 194,386 — — — — 194,490 
Treasury stock acquired from employees upon vesting or forfeiture of restricted stock— — — — — 109 (4,838)(4,838)
Stock-based compensation— — 4,410 — — — — 4,410 
Foreign currency translation adjustments— — — — (2,714)— — (2,714)
Net loss— — — (18,288)— — — (18,288)
Balances at March 31, 202435,439 $703 $844,210 $(293,244)$(3,653)1,465 $(21,616)$526,400 
Issuance of common stock upon the exercise of stock options35 — 432 — — — — 432 
Net issuance of restricted stock awards and restricted stock units85 2 (2)— — — — — 
Treasury stock acquired from employees upon vesting or forfeiture of restricted stock— — — — — 5 (212)(212)
Issuance of common stock for employee stock purchase plan15 — 526 — — — — 526 
Stock-based compensation— — 7,240 — — — — 7,240 
Foreign currency translation adjustments— — — — (255)— — (255)
Net income— — — 54,190 — — — 54,190 
Balances at June 30, 202435,574 $705 $852,406 $(239,054)$(3,908)1,470 $(21,828)$588,321 
Issuance of common stock upon the exercise of stock options32 1 501 — — — — 502 
Net issuance of restricted stock awards and restricted stock units5 — — — — — — — 
Issuance of common stock for acquisition (see Note 3)2,163 43 113,967 — — — — 114,010 
Treasury stock acquired from employees upon vesting or forfeiture of restricted stock— — — — — — (21)(21)
Stock-based compensation— — 5,937 — — — — 5,937 
Foreign currency translation adjustments— — — — 3,790 — — 3,790 
Net loss— — — (19,832)— — — (19,832)
Balances at September 30, 202437,774 $749 $972,811 $(258,886)$(118)1,470 $(21,849)$692,707 

See accompanying notes to unaudited interim condensed consolidated financial statements


6
PAR TECHNOLOGY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(In thousands)
(unaudited)

Common StockAdditional
Paid in
Capital		Accumulated DeficitAccumulated Other Comprehensive LossTreasury StockTotal
Shareholders’
Equity
SharesAmountSharesAmount
Balances at December 31, 202228,590 $570 $595,286 $(205,204)$(1,365)1,271 $(14,093)$375,194 
Issuance of common stock upon the exercise of stock options5 — 52 — — — — 52 
Net issuance of restricted stock awards and restricted stock units160 2 — — — — — 2 
Treasury stock acquired from employees upon vesting or forfeiture of restricted stock— — — — — 79 (2,478)(2,478)
Stock-based compensation— — 3,055 — — — — 3,055 
Foreign currency translation adjustments— — — — (42)— — (42)
Net loss— — — (15,905)— — — (15,905)
Balances at March 31, 202328,755 $572 $598,393 $(221,109)$(1,407)1,350 $(16,571)$359,878 
Issuance of common stock upon the exercise of stock options9 — 147 — — — — 147 
Net issuance of restricted stock awards and restricted stock units35 — — — — — — — 
Treasury stock acquired from employees upon vesting or forfeiture of restricted stock— — — — — 6 (205)(205)
Stock-based compensation— — 3,615 — — — — 3,615 
Foreign currency translation adjustments— — — — (1,517)— — (1,517)
Net loss— — — (19,702)— — — (19,702)
Balances at June 30, 202328,799 $572 $602,155 $(240,811)$(2,924)1,356 $(16,776)$342,216 
Issuance of common stock upon the exercise of stock options74 2 709 — — — — 711 
Net issuance of restricted stock awards and restricted stock units5 — — — — — — — 
Treasury stock acquired from employees upon vesting or forfeiture of restricted stock— — — — — 2 (60)(60)
Stock-based compensation— — 3,972 — — — — 3,972 
Foreign currency translation adjustments— — — — 1,417 — — 1,417 
Net loss— — — (15,516)— — — (15,516)
Balances at September 30, 202328,878 $574 $606,836 $(256,327)$(1,507)1,358 $(16,836)$332,740 

See accompanying notes to unaudited interim condensed consolidated financial statements
7
PAR TECHNOLOGY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)

Nine Months Ended
September 30,
20242023
Cash flows from operating activities:
Net income (loss)$16,070 $(51,123)
Net income from discontinued operations(80,687)(8,973)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization26,702 20,133 
Accretion of debt in interest expense, net1,755 1,594 
Accretion of discount on held to maturity investments in interest expense, net283 — 
Current expected credit losses2,439 783 
Provision for obsolete inventory(14)(1,271)
Stock-based compensation16,583 10,544 
Impairment loss225 — 
Adjustment to contingent consideration liability(600)(7,500)
Deferred income tax(8,288)— 
Changes in operating assets and liabilities:
Accounts receivable(11,696)(2,767)
Inventories(314)14,601 
Other current assets(3,935)(1,817)
Other assets1,315 (395)
Accounts payable4,960 1,960 
Accrued salaries and benefits3,490 (3,901)
Accrued expenses(1,848)123 
Customer deposits and deferred service revenue6,279 (1,292)
Customers payable5,096 1,553 
Other long-term liabilities(2,253)(186)
Cash used in operating activities - continuing operations(24,438)(27,934)
Cash provided by (used in) operating activities - discontinued operations(4,183)9,446 
Net cash used in operating activities(28,621)(18,488)
Cash flows from investing activities:
Cash paid for acquisition, net of cash acquired(293,570)— 
Capital expenditures(791)(4,650)
Capitalization of software costs(4,004)(3,364)
Proceeds from company-owned life insurance policies3,266 — 
Proceeds from sale of held to maturity investments53,277 68,115 
Purchases of held to maturity investments(28,351)(64,542)
Cash used in investing activities - continuing operations(270,173)(4,441)
Cash provided by (used in) investing activities - discontinued operations92,075 (371)
Net cash used in investing activities(178,098)(4,812)
Cash flows from financing activities:
Proceeds from private placement of common stock, net of issuance costs194,490 — 
Proceeds from debt issuance, net of original issue discount87,333 — 
Treasury stock acquired from employees upon vesting or forfeiture of restricted stock(5,071)(2,743)
Proceeds from employee stock purchase plan526 — 
Proceeds from exercise of stock options2,039 912 
Cash provided by (used in) financing activities - continuing operations279,317 (1,831)
Cash provided by (used in) in financing activities - discontinued operations— — 
Net cash provided by (used in) financing activities279,317 (1,831)
See accompanying notes to unaudited interim condensed consolidated financial statements
8
PAR TECHNOLOGY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(In thousands)
(unaudited)

Nine Months Ended
September 30,
20242023
Effect of exchange rate changes on cash and cash equivalents933 (508)
Net increase (decrease) in cash and cash equivalents and cash held on behalf of customers73,531 (25,639)
Cash and cash equivalents and cash held on behalf of customers at beginning of period47,539 77,533 
Cash and cash equivalents and cash held on behalf of customers at end of period$121,070 $51,894 
Reconciliation of cash and cash equivalents and cash held on behalf of customers
Cash and cash equivalents$105,804 $43,136 
Cash held on behalf of customers15,266 8,758 
Total cash and cash equivalents and cash held on behalf of customers$121,070 $51,894 
Supplemental disclosures of cash flow information:
Cash paid for interest$3,713 $4,022 
Cash paid for income taxes1,543 2,392 
Capitalized software recorded in accounts payable36 468 
Capital expenditures in accounts payable62 98 
Common stock issued for acquisition133,181 — 

Cash flows are presented on a consolidated basis and include $0.2 million of cash and cash equivalents presented in current assets of discontinued operations in the condensed consolidated balance sheets as of December 31, 2023. Refer to “Note 4 – Discontinued Operations” for additional information related to cash flows from discontinued operations.

See accompanying notes to unaudited interim condensed consolidated financial statements
9
PAR TECHNOLOGY CORPORATION
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

Note 1 — Summary of Significant Accounting Policies

Nature of Business

PAR Technology Corporation (the “Company” or “PAR,” “we,” or “us”), through its consolidated subsidiaries, operates in one segment, Restaurant/Retail. We report aggregate financial information on a consolidated basis to our Chief Executive Officer, who is the Company’s chief operating decision maker. The Restaurant/Retail segment provides leading omnichannel cloud-based software and hardware solutions to the restaurant and retail industries.

Our product and service offerings include point-of-sale, customer engagement and loyalty, digital ordering and delivery, operational intelligence technologies, payment processing, hardware, and related technologies, solutions, and services. We provide enterprise restaurants, franchisees, and other foodservice outlets with operational efficiencies through a data-driven network with integration capabilities from point-of-sale to the kitchen, to fulfillment. Our subscription services are grouped into two product lines: Engagement Cloud, which includes Punchh and PAR Retail (formerly Stuzo) products and services for customer loyalty and engagement, Plexure for international customer loyalty and engagement, and PAR Ordering (formerly MENU) for omnichannel digital ordering and delivery; and Operator Cloud, which includes PAR POS (formerly Brink POS) and TASK for front-of-house, PAR Payment Services and PAR Pay for payments, and Data Central for back-of-house. The accompanying consolidated financial statements include the Company's accounts and those of its consolidated subsidiaries. All intercompany transactions have been eliminated in consolidation.

Basis of Presentation

The accompanying financial statements of PAR Technology Corporation and its consolidated subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial statements and the instructions to Form 10-Q and Regulation S-X pertaining to interim financial statements as promulgated by the SEC. In the opinion of management, the Company's financial statements include all normal and recurring adjustments necessary in order to make the financial statements not misleading and to provide a fair presentation of the Company's financial results for the interim period included in this Quarterly Report. Interim results are not necessarily indicative of results for the full year or any future periods. The information included in this Quarterly Report should be read in conjunction with the Company's audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (the “2023 Annual Report”).

The results of operations of the Company's Government segment are reported as discontinued operations in the condensed consolidated statements of operations for all periods presented and the related assets and liabilities associated with the discontinued operations are classified as assets and liabilities of discontinued operations in the condensed consolidated balance sheet as of December 31, 2023. All results and information in the condensed consolidated financial statements are presented as continuing operations and exclude the Government segment unless otherwise noted specifically as discontinued operations.

Use of Estimates

The preparation of the 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 financial statements and the reported amounts of revenues and expenses during the period. Significant items subject to these 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 including right-to-use assets and liabilities, identifiable intangible assets and goodwill, valuation allowances for receivables, valuation of excess and obsolete inventories, and measurement of contingent consideration at fair value. Actual results could differ from those estimates.



10
Cash and Cash Equivalents and Cash Held on Behalf of Customers

Cash and cash equivalents and cash held on behalf of customers consist of the following:

(in thousands)September 30, 2024December 31, 2023
Cash and cash equivalents
Cash$103,643 $37,143 
Money market funds2,161 40 
Cash held on behalf of customers15,266 10,170 
Total cash and cash equivalents and cash held on behalf of customers$121,070 $47,353 

The Company maintained bank balances that, at times, exceeded the federally insured limit during the nine months ended September 30, 2024. The Company did not experience losses relating to these deposits and management does not believe that the Company is exposed to any significant credit risk with respect to these amounts.

Short-Term Investments

The carrying value of investment securities consist of the following:

(in thousands)September 30, 2024December 31, 2023
Short-term investments
Treasury bills and notes$11,985 $37,194 
Short-term deposits593 — 
Total short-term investments$12,578 $37,194 

The Company did not have any material gains or losses on these securities during the nine months ended September 30, 2024. The estimated fair value of these securities approximated their carrying value as of September 30, 2024 and December 31, 2023.

Discontinued Operations

In determining whether a group of assets disposed of (or is to be disposed of) should be presented as a discontinued operation, the Company analyzes whether the group of assets disposed of represented a component of the entity; that is, whether it had historic operations and cash flows that were discrete both operationally and for financial reporting purposes. In addition, the Company considers whether the disposal represents a strategic shift that has or will have a major effect on the Company’s operations and financial results.

The assets and liabilities of a discontinued operation, other than goodwill, are measured at the lower of carrying amount or fair value, less cost to sell. When a portion of a reporting unit that constitutes a business is to be disposed of, the goodwill associated with that business is included in the carrying amount of the business based on the relative fair values of the business to be disposed of and the portion of the reporting unit that will be retained. Interest is allocated to discontinued operations if the interest is directly attributable to the discontinued operations or is interest on debt that is required to be repaid as a result of the disposal.

Other Assets

Other assets include deferred implementation costs of $7.9 million and $8.8 million and deferred commissions of $3.6 million and $2.6 million at September 30, 2024 and December 31, 2023, respectively.





11
The following table summarizes amortization expense for deferred implementation costs and deferred commissions:
Three Months Ended September 30,Nine Months Ended
September 30,
(in thousands)2024202320242023
Amortization of deferred implementation costs$1,569 $1,271 $4,612 $3,409 
Amortization of deferred commissions430 226 1,235 617 

Other assets include the cash surrender value of life insurance related to the Company’s deferred compensation plan eligible to certain employees. The cash surrender value of the deferred compensation plan was cashed out during the three months ended September 30, 2024. The balance of the life insurance policies was zero and $3.3 million at September 30, 2024 and December 31, 2023, respectively.

Other Long-Term Liabilities

Other long-term liabilities include deferred tax liabilities of $22.7 million and $0.8 million at September 30, 2024 and December 31, 2023, respectively.

Other long-term liabilities include amounts owed to employees that participated in the Company’s deferred compensation plan. Amounts owed to employees who participated in the deferred compensation plan were $0.1 million and $0.4 million at September 30, 2024 and December 31, 2023, respectively.

Gain on Insurance Proceeds

During the nine months ended September 30, 2024, and 2023 the Company received $0.1 million and $0.5 million, respectively, of insurance proceeds in connection with the settlement of legacy claims.

Related Party Transactions

During the nine months ended September 30, 2023, Ronald Shaich, the sole member of Act III Management LLC ("Act III Management"), served as a strategic advisor to the Company's board of directors pursuant to a strategic advisor agreement, which terminated on June 1, 2023. Keith Pascal, a director of the Company, is an employee of Act III Management and serves as its vice president and secretary. Mr. Pascal does not have an ownership interest in Act III Management.

As of September 30, 2024 and December 31, 2023, the Company had zero accounts payable owed to Act III Management. During the three months ended September 30, 2024 and 2023, the Company paid Act III Management zero and during the nine months ended September 30, 2024 and 2023 the Company paid Act III Management zero and $0.1 million, respectively, for services performed under the strategic advisor agreement.

In connection with the acquisition of TASK Group Holdings Limited (“TASK Group” and such acquisition, the "TASK Group Acquisition"), the Company leases an Australian office from the Houden Superannuation Fund. The trustees and beneficiaries of the Houden Superannuation Fund include two executives of TASK Group. The Australian office has been occupied by the TASK Group since 2005 with the last rent increase occurring in March 2021 based on an independent review of comparable market rent. During the three months ended September 30, 2024, the Company paid the Houden Superannuation Fund $0.1 million in rent. The Company had zero accounts payable owed to the Houden Superannuation Fund as of September 30, 2024.

Impairment of Long-Lived Assets

During the three months ended September 30, 2024, the Company recorded an impairment loss of $0.2 million included in general and administrative expense in the condensed consolidated statements of operations related to the discontinuance of the Brink POS trade name.

Recently Adopted Accounting Pronouncements

There were no recent accounting pronouncements or changes in accounting pronouncements during the nine months ended September 30, 2024 that are of significance or potential significance to the Company.
12
Note 2 — Revenue Recognition
Deferred Revenue
Deferred revenue is as follows:
(in thousands)September 30, 2024December 31, 2023
Current$28,777 $7,250 
Non-current1,733 4,204 
Total$30,510 $11,454 
Most performance obligations greater than one year relate to service and support contracts that the Company expects to fulfill within 36 months. The Company expects to fulfill 100% of service and support contracts within 60 months.
The changes in deferred revenue, inclusive of both current and long-term, are as follows:

(in thousands)20242023
Beginning balance - January 1$11,454 $13,584 
Acquired deferred revenue (Note 3)12,391 — 
Recognition of deferred revenue(73,706)(19,074)
Deferral of revenue79,911 17,889 
Impact of foreign currency translation on deferred revenue460 — 
Ending balance - September 30$30,510 $12,399 
The above tables exclude customer deposits of $1.7 million and $2.0 million as of the nine months ended September 30, 2024 and 2023, respectively. During the three months ended September 30, 2024 and 2023, the Company recognized revenue included in deferred revenue at the beginning of each respective period of $1.4 million and $2.7 million. During the nine months ended September 30, 2024 and 2023, the Company recognized revenue included in deferred revenue at the beginning of each respective period of $6.3 million and $8.7 million.

Disaggregated Revenue

The Company disaggregates revenue from contracts with customers by major product line because the Company believes it best depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by contract terms and economic factors.

Three Months Ended September 30, 2024Three Months Ended September 30, 2023
Point in timeOver timePoint in timeOver time
Subscription service$— $59,909 $— $31,363 
Hardware22,650 — 25,824 — 
Professional service5,263 8,932 4,272 7,242 
Total$27,913 $68,841 $30,096 $38,605 
Nine Months Ended September 30, 2024Nine Months Ended September 30, 2023
Point in timeOver timePoint in timeOver time
Subscription service$— $143,160 $— $89,700 
Hardware60,992 — 78,991 — 
Professional service15,977 24,848 16,467 21,656 
Total$76,969 $168,008 $95,458 $111,356 

13
Note 3 — Acquisitions

TASK Group Acquisition

On July 18, 2024 (New York Time), July 19, 2024 (Sydney Time) (the "TASK Closing Date"), the Company completed its acquisition of TASK Group, pursuant to a court-approved scheme of arrangement. On the TASK Closing Date, the Company paid TASK Group's shareholders approximately $131.5 million in cash consideration, and issued 2,163,393 shares of common stock at a price of $52.70 per share of Company common stock, for a total purchase consideration of $245.5 million. The Company acquired TASK Group to expand its footprint in the international foodservice vertical with TASK Group's Australia-based global foodservice transaction platform that offers international unified commerce solutions and loyalty and engagement solutions.

The Company incurred acquisition expenses related to the TASK Group Acquisition of approximately $2.9 million which are included in general and administrative in the condensed consolidated statements of operations.

The TASK Group Acquisition was accounted for as a business combination in accordance with Accounting Standards Codification ("ASC") Topic 805, Business Combinations. Accordingly, assets acquired and liabilities assumed have been accounted for at their preliminarily determined respective fair values as of the TASK Closing Date. The fair value determinations were based on management's estimates and assumptions, with the assistance of independent valuation and tax consultants. Preliminary fair values are subject to measurement period adjustments within the permitted measurement period (up to one year from the TASK Closing Date) as management finalizes its procedures and net working capital adjustments (if any) are settled.

The following table presents management's preliminary purchase price allocation:

(in thousands)Purchase price allocation
Cash$4,179 
Short-term investments562 
Accounts receivable7,105 
Property and equipment1,030 
Lease right-of-use assets3,418 
Developed technology32,100 
Customer relationships48,000 
Trade names1,800 
Prepaid and other acquired assets1,916 
Goodwill181,442 
Total assets281,552 
Accounts payable4,212 
Accrued expenses3,502 
Lease right-of-use liabilities3,397 
Deferred revenue4,710 
Deferred taxes20,263 
Consideration paid$245,468 

Intangible Assets

The Company identified three acquired intangible assets in the TASK Group Acquisition: developed technology; customer relationships; and trade names split across the TASK and Plexure product lines. The preliminary fair values of developed technology and customer relationship intangible assets were determined utilizing the “multi-period excess earnings method”, which method is predicated upon the calculation of the net present value of after-tax net cash flows respectively attributable to each asset. The Company applied a seven-year economic life and discount rate of 12.5% in determining the Plexure developed technology and a seven-year economic life and discount rate of 14.0% in determining the TASK developed technology preliminary intangible fair values. The Company applied a 10.0% estimated annual attrition rate and a discount rate of 14.0% for the TASK customer relationships and applied a 95.0% probability of renewal factor and a discount rate of 12.5% for the
14
Plexure customer relationships intangible preliminary fair values. The preliminary fair value of trade names intangible was determined utilizing the “relief from royalty” approach, which is a form of the income approach that attributes savings recognized from not having to pay a royalty for the use of an asset. The Company applied a fair and reasonable royalty rate of 0.5% and a discount rate of 12.5% for the TASK trade name and a fair and reasonable royalty rate of 0.5% and a discount rate of 14.0% in determining the Plexure trade name intangible preliminary fair values. The estimated useful life of each of the foregoing identifiable intangible assets was preliminarily determined to be: seven years for developed technology; thirteen years for customer relationships; and eight years for the trade names.

Goodwill

Goodwill represents the excess of consideration transferred for the fair value of net identifiable assets acquired and is tested for impairment at least annually. The goodwill value represents expected synergies from the product acquired and other benefits. It is not deductible for income tax purposes.

Deferred Taxes

The Company determined the deferred tax position to be recorded at the time of the TASK Group Acquisition in accordance with ASC Topic 740, Income Taxes, resulting in recognition of $20.3 million in deferred tax liabilities for future reversal of taxable temporary differences primarily for intangible assets.

Stuzo Acquisition

On March 8, 2024, the Company acquired 100% of the outstanding equity interests of Stuzo Blocker, Inc., Stuzo Holdings, LLC and their subsidiaries (collectively, “Stuzo” and such acquisition, the “Stuzo Acquisition”), a digital engagement software provider to convenience and fuel retailers ("C-Stores"), for purchase consideration of approximately $170.5 million paid in cash (the "Cash Consideration"), subject to certain adjustments (including customary adjustments for Stuzo cash, debt, debt-like items, and net working capital), and $19.2 million paid in shares of Company common stock. 441,598 shares of common stock were issued as purchase consideration, determined using a fair value share price of $43.41. The Company acquired Stuzo to expand its footprint in the C-Stores market vertical with Stuzo's industry-leading guest engagement platform (PAR Retail) serving major brands in the space.

$1.5 million of the Cash Consideration was deposited into an escrow account administered by a third party to fund potential post-closing adjustments and obligations. During the three months ended September 30, 2024, the escrow account was released in full.

The Company incurred acquisition expenses related to the Stuzo Acquisition of approximately $2.9 million which are included in general and administrative in the condensed consolidated statements of operations.

The Stuzo Acquisition was accounted for as a business combination in accordance with ASC Topic 805, Business Combinations. Accordingly, assets acquired and liabilities assumed have been accounted for at their preliminarily determined respective fair values as of March 8, 2024, (the "Stuzo Acquisition Date"). The fair value determinations were based on management's estimates and assumptions, with the assistance of independent valuation and tax consultants. Preliminary fair values are subject to measurement period adjustments within the permitted measurement period (up to one year from the Stuzo Acquisition Date) as management finalizes its procedures and net working capital adjustments (if any) are settled.

During the three months ended September 30, 2024, preliminary fair values of assets and liabilities as of the Stuzo Acquisition Date were adjusted to reflect ongoing acquisition valuation analyses and net working capital adjustments. These adjustments included changes to accrued expenses and goodwill to reflect changes in underlying fair value assumptions. The Company is in the process of finalizing valuation assumptions for the intangibles and the sales tax liability exposure as of the Stuzo Acquisition Date.

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The following table presents management's current purchase price allocation and the initial purchase price allocation:

(in thousands)Current purchase price allocationInitial purchase price allocation
Cash$4,244 $4,244 
Accounts receivable1,262 2,208 
Property and equipment307 307 
Developed technology18,200 18,200 
Customer relationships39,400 39,000 
Trademarks5,400 6,600 
Non-competition agreements3,500 4,800 
Prepaid and other acquired assets774 774 
Goodwill136,602 132,140 
Total assets209,689 208,273 
Accounts payable317 317 
Accrued expenses4,053 4,459 
Deferred revenue7,680 5,443 
Deferred taxes7,934 8,349 
Consideration paid$189,705 $189,705 

Intangible Assets

The Company identified four acquired intangible assets in the Stuzo Acquisition: developed technology; customer relationships; trademarks; and non-competition agreements. The preliminary fair values of developed technology and customer relationship intangible assets were determined utilizing the “multi-period excess earnings method”, which method is predicated upon the calculation of the net present value of after-tax net cash flows respectively attributable to each asset. The Company applied a seven-year economic life and discount rate of 12.5% in determining the Stuzo developed technology preliminary intangible fair value and applied a 7.0% estimated annual attrition rate and discount rate of 12.5% in determining the Stuzo customer relationships intangible preliminary fair value. The preliminary fair value of trademarks intangible was determined utilizing the “relief from royalty” approach, which is a form of the income approach that attributes savings recognized from not having to pay a royalty for the use of an asset. The Company applied a fair and reasonable royalty rate of 1.0% and discount rate of 12.5% in determining the trademarks intangible preliminary fair value. The preliminary fair value of the Stuzo non-competition agreements was determined utilizing the discounted earnings method. The estimated useful life of each of the foregoing identifiable intangible assets was preliminarily determined to be: seven years for developed technology; fifteen years for customer relationships related to SaaS platform and related support; five years for customer relationships related to managed platform development services; indefinite for the trademarks; and five years for the non-competition agreements.

Goodwill

Goodwill represents the excess of consideration transferred for the fair value of net identifiable assets acquired and is tested for impairment at least annually. The goodwill value represents expected synergies from the product acquired and other benefits. It is not deductible for income tax purposes.

Deferred Taxes

The Company determined the deferred tax position to be recorded at the time of the Stuzo Acquisition in accordance with ASC Topic 740, Income Taxes, resulting in recognition of $7.9 million in deferred tax liabilities for future reversal of taxable temporary differences primarily for intangible assets.

The net deferred tax liability relating to the Stuzo Acquisition was determined by the Company to provide future taxable temporary differences that allow for the Company to utilize certain previously fully reserved deferred
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tax assets. Accordingly, the Company recognized a reduction to its valuation allowance resulting in a net tax benefit of $7.7 million for the nine months ended September 30, 2024.

Pro Forma Financial Information - unaudited

For the three and nine months ended September 30, 2024, the Stuzo Acquisition resulted in additional revenues of $10.7 million and $23.4 million, respectively, and income before income taxes of $1.6 million and $3.4 million, respectively; and the TASK Group Acquisition resulted in additional revenues of $9.6 million and $9.6 million, respectively, and loss before income taxes of $(0.1) million and $(0.1) million, respectively.

The following table summarizes the Company's unaudited pro forma results of operations for the three and nine months ended September 30, 2024 and 2023 as if the TASK Group Acquisition and Stuzo Acquisition had occurred on January 1, 2023:

Three Months Ended September 30,Nine Months Ended September 30,
(in thousands)2024202320242023
Total revenue$98,999 $90,968 $279,094 $273,100 
Net loss from continuing operations(29,862)(19,642)(82,960)(51,922)
The unaudited pro forma results presented above are for illustrative purposes only and do not reflect the realization of actual cost savings or any related integration costs. The unaudited pro forma results do not purport to be indicative of the results that would have been obtained, or to be a projection of results that may be obtained in the future. These unaudited pro forma results include certain adjustments, primarily due to increases in amortization expense due to the fair value adjustments of intangible assets, acquisition related costs and the impact of income taxes on the pro forma adjustments. $5.4 million of acquisition costs have been reflected in the 2023 pro forma results.


Note 4 — Discontinued Operations

On June 7, 2024 (the “PGSC Closing Date”), the Company entered into a Stock Purchase Agreement (the “Purchase Agreement”) with Booz Allen Hamilton Inc. ("Booz Allen Hamilton") for the sale of PAR Government Systems Corporation ("PGSC"), a wholly owned subsidiary of the Company. Pursuant to the Purchase Agreement, on the Closing Date, Booz Allen Hamilton acquired 100% of the issued and outstanding shares of common stock of PGSC for a cash purchase price of $95.0 million, before customary post-closing adjustments based on PGSC’s indebtedness, working capital, cash, and transaction expenses at closing. At closing we entered into a transition services agreement with Booz Allen Hamilton pursuant to which the Company and Booz Allen Hamilton provide certain transitional services to each other as contemplated by and subject to the Purchase Agreement. The service period for the transitional services generally ends during the third quarter of 2025.
On July 1, 2024 (the "RRC Closing Date"), the Company sold 100% of the issued and outstanding equity interests of Rome Research Corporation ("RRC"), a wholly-owned subsidiary of the Company, to NexTech Solutions Holdings, LLC ("NexTech") for a cash purchase price of $7.0 million, before customary post-closing adjustments based on RRC’s indebtedness, working capital, cash, and transaction expenses at closing. At closing we entered into a transition services agreement with NexTech pursuant to which the Company and NexTech provide certain transitional services to each other as contemplated by and subject to the transition services agreement. The service period for the transitional services generally ends during the third quarter of 2025.
The sale of PGSC and RRC comprise the sale of 100% of the Company's Government segment. The Company recognized a pre-tax gain on sale of $77.2 million from the sale of PGSC and RRC in the nine months ended September 30, 2024.

Pursuant to the Purchase Agreement, within 120 days following the PGSC Closing Date Booz Allen Hamilton is required to deliver to the Company a closing statement setting forth its determination of net working capital and any resulting net working capital surplus or deficit. To the extent there is an adjustment to net working capital, as agreed to by the Company and Booz Allen Hamilton pursuant to the Purchase Agreement, any such change will be recorded as an adjustment to the gain on sale of discontinued operations for the period such change occurs.

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Pursuant to the sale of RRC, $0.7 million of the cash purchase price was deposited into an escrow account administered by a third party to fund potential post-closing adjustments and obligations. As of September 30, 2024, the balance in the escrow account remained at $0.7 million. Within 90 days following the RRC Closing Date NexTech is required to deliver to the Company a closing statement setting forth its determination of net working capital and any resulting net working capital surplus or deficit. To the extent there is an adjustment to net working capital, as agreed to by the Company and NexTech pursuant to the sale, any such change will be recorded as an adjustment to the gain on sale of discontinued operations for the period such change occurs.

As of September 30, 2024, the Company estimated the federal taxable gain on sale for PGSC and RRC to be $74.6 million, however, we expect to offset the taxable gain through the utilization of several tax benefits including $41.8 million of our net operating loss carryforwards, $22.4 million of our Section 163(j) interest expense limitation carryforwards, and $1.6 million of our research and development tax credits. Additionally, the income tax associated with the gain will be impacted by the final allocation of the sales price, which may be materially different from the Company’s estimates. The impact of changes in estimated income tax (if any) will be recorded as an adjustment to discontinued operations in the period such change in estimate occurs.

The Company incurred expenses related to its disposition of PGSC and RRC of approximately $6.9 million which are included in net income from discontinued operations in the condensed consolidated statements of operations.

The accounting requirements for reporting the disposition of PGSC and RRC as discontinued operations were met when the disposition of PGSC was completed and the sale of RRC was deemed probable. Accordingly, the historical results of PGSC and RRC have been presented as discontinued operations and, as such, have been excluded from continuing operations for all periods presented.

The following table presents the major classes of assets and liabilities of discontinued operations for PGSC and RRC as of December 31, 2023:

(in thousands)December 31, 2023
Accounts receivable – net$20,703 
Other current assets987 
Total current assets21,690 
Noncurrent assets2,785 
Total assets of discontinued operations$24,475 
Accounts payable4,209 
Accrued salaries and benefits5,013 
Accrued expenses6,910 
Other current liabilities246 
Total current liabilities16,378 
Noncurrent liabilities1,710 
Total liabilities of discontinued operations$18,088 













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The following table presents the major categories of income from discontinued operations:

Three Months Ended September 30,Nine Months Ended
September 30,
(in thousands)2024202320242023
Contract revenue$— $38,433 $66,540 $101,301 
Contract cost of sales— (34,506)(60,218)(91,970)
Operating income from discontinued operations— 3,927 6,322 9,331 
General and administrative expense177 (67)(693)(80)
Other expense, net— (111)— (221)
Gain on sale of discontinued operations451 — 77,205 — 
Income from discontinued operations before provision for income taxes628 3,749 82,834 9,030 
Benefit from (provision for) income taxes204 (31)(2,147)(57)
Net income from discontinued operations$832 $3,718 $80,687 $8,973 

In accordance with ASC Topic 205, Presentation of Financial Statements, the Company adjusted contract cost of sales to exclude corporate overhead allocated to discontinued operations for all periods presented.

The following table presents select non-cash operating and investing activities related to cash flows from discontinued operations:

Three Months Ended September 30,Nine Months Ended
September 30,
(in thousands)2024202320242023
Depreciation and amortization$— $116 $200 $347 
Capital expenditures— 156 233 370 
Stock-based compensation50 37 1,004 98 

Note 5 — Accounts Receivable, net

At September 30, 2024 and December 31, 2023, the Company had current expected credit losses of $3.6 million and $1.9 million, respectively, against accounts receivable.

Changes in the current expected credit loss for the nine months ended September 30 were:

(in thousands)20242023
Beginning Balance - January 1$1,949 $2,134 
Provisions2,439 783 
Write-offs(763)(734)
Ending Balance - September 30$3,625 $2,183 

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Note 6 — Inventories, net

The components of inventory, adjusted for reserves, consisted of the following:

(in thousands)September 30, 2024December 31, 2023
Finished goods$15,389 $13,530 
Work in process185 216 
Component parts7,793 9,147 
Service parts548 667 
Inventories, net$23,915 $23,560 

At September 30, 2024 and December 31, 2023, the Company had excess and obsolescence reserves of $8.9 million and $9.0 million, respectively, against inventories.
Note 7 — Identifiable Intangible Assets and Goodwill

The Company's identifiable intangible assets represent intangible assets acquired in acquisitions and software development costs. The components of identifiable intangible assets are:
(in thousands)September 30, 2024December 31, 2023Estimated
Useful Life		Weighted-Average Amortization Period
Acquired developed technology $173,889 $119,800 
3 - 7 years
5.40 years
Internally developed software costs37,913 34,735 3 years2.76 years
Customer relationships101,910 14,510 
5 -