Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Feb. 29, 2016 | Jun. 30, 2015 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | PAR TECHNOLOGY CORP | ||
Entity Central Index Key | 708,821 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 0 | ||
Entity Common Stock, Shares Outstanding | 15,644,729 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2015 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 8,024 | $ 9,867 |
Accounts receivable-net | 29,530 | 29,674 |
Inventories-net | 21,499 | 25,928 |
Deferred income taxes | 6,741 | 4,512 |
Other current assets | 3,808 | 4,018 |
Assets of discontinued operations | 0 | 22,119 |
Total current assets | 69,602 | 96,118 |
Property, plant and equipment - net | 5,716 | 5,148 |
Note receivable | 3,320 | 0 |
Deferred income taxes | 11,038 | 11,357 |
Goodwill | 11,051 | 11,051 |
Intangible assets - net | 10,898 | 10,580 |
Other assets | 3,687 | 3,043 |
Total Assets | 115,312 | 137,297 |
Current liabilities: | ||
Current portion of long-term debt | 2,103 | 3,173 |
Borrowings under line of credit | 0 | 5,000 |
Accounts payable | 11,729 | 19,258 |
Accrued salaries and benefits | 5,727 | 5,726 |
Accrued expenses | 6,705 | 6,492 |
Customer deposits | 180 | 1,242 |
Deferred service revenue | 10,639 | 10,388 |
Income taxes payable | 279 | 475 |
Liabilities of discontinued operations | 441 | 0 |
Total current liabilities | 37,803 | 51,754 |
Long-term debt | 566 | 2,566 |
Other long-term liabilities | 8,883 | 8,847 |
Noncurrent liabilities of discontinued operations | 0 | 4,617 |
Total liabilities | $ 47,252 | $ 67,784 |
Commitments and Contingencies | ||
Shareholders' Equity: | ||
Preferred stock, $.02 par value, 1,000,000 shares authorized | $ 0 | $ 0 |
Common stock, $.02 par value, 29,000,000 shares authorized; 17,352,198 and 17,274,708 shares issued, 15,644,729 and 15,566,599 outstanding at December 31, 2015 and 2014, respectively | 347 | 346 |
Capital in excess of par value | 45,753 | 44,854 |
Retained earnings | 30,574 | 31,465 |
Accumulated other comprehensive loss | (2,778) | (1,316) |
Treasury stock, at cost, 1,708,109 shares | (5,836) | (5,836) |
Total shareholders' equity | 68,060 | 69,513 |
Total Liabilities and Shareholders' Equity | $ 115,312 | $ 137,297 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2015 | Dec. 31, 2014 |
Shareholders Equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.02 | $ 0.02 |
Preferred stock, authorized (in shares) | 1,000,000 | 1,000,000 |
Common stock, par value (in dollars per share) | $ 0.02 | $ 0.02 |
Common stock, authorized (in shares) | 29,000,000 | 29,000,000 |
Common stock, issued (in shares) | 17,352,198 | 17,274,708 |
Common stock, outstanding (in shares) | 15,644,729 | 15,566,599 |
Treasury stock, at cost (in shares) | 1,708,109 | 1,708,109 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Net revenues: | ||
Product | $ 94,397 | $ 84,484 |
Service | 46,754 | 45,690 |
Contract | 87,852 | 87,689 |
Revenue, net | 229,003 | 217,863 |
Costs of sales: | ||
Product | 68,192 | 58,889 |
Service | 32,824 | 35,011 |
Contract | 81,848 | 82,347 |
Cost of goods and services sold | 182,864 | 176,247 |
Gross margin | 46,139 | 41,616 |
Operating expenses: | ||
Selling, general and administrative | 28,276 | 28,974 |
Research and development | 10,247 | 8,947 |
Amortization of identifiable intangible assets | 987 | 279 |
Operating expenses | 39,510 | 38,200 |
Operating income from continuing operations | 6,629 | 3,416 |
Other (expense) income, net | (800) | 485 |
Interest expense | (308) | (136) |
Income from continuing operations before provision for income taxes | 5,521 | 3,765 |
Provision for income taxes | (1,500) | (3,694) |
Income from continuing operations | 4,021 | 71 |
Discontinued operations | ||
Loss on discontinued operations (net of tax) | (4,912) | (3,722) |
Net loss | $ (891) | $ (3,651) |
Basic Earnings per Share: | ||
Income from continuing operations (in dollars per share) | $ 0.26 | $ 0 |
Loss from discontinued operations (in dollars per share) | (0.32) | (0.24) |
Net loss (in dollars per share) | (0.06) | (0.24) |
Diluted Earnings per Share: | ||
Income loss from continuing operations (in dollars per share) | 0.26 | 0 |
Loss from discontinued operations (in dollars per share) | (0.31) | (0.24) |
Net loss (in dollars per share) | $ (0.06) | $ (0.23) |
Weighted average shares outstanding | ||
Basic (in shares) | 15,562 | 15,501 |
Diluted (in shares) | 15,666 | 15,582 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS [Abstract] | ||
Net loss | $ (891) | $ (3,651) |
Other comprehensive loss net of applicable tax: | ||
Foreign currency translation adjustments | (1,462) | (777) |
Comprehensive loss | $ (2,353) | $ (4,428) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock [Member] | Capital in Excess of Par Value [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Treasury Stock [Member] | Total |
Balance at Dec. 31, 2013 | $ 344 | $ 43,635 | $ 35,116 | $ (539) | $ (5,836) | $ 72,720 |
Balance (in shares) at Dec. 31, 2013 | 17,302,000 | (1,708,000) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (3,651) | (3,651) | ||||
Net issuance of restricted stock awards | $ 2 | 2 | ||||
Net issuance of restricted stock awards (in shares) | (27,000) | |||||
Equity based compensation | 1,185 | 1,185 | ||||
Stock options and awards - excess tax benefits | 34 | 34 | ||||
Translation adjustments, net of tax | (777) | (777) | ||||
Balance at Dec. 31, 2014 | $ 346 | 44,854 | 31,465 | (1,316) | $ (5,836) | $ 69,513 |
Balance (in shares) at Dec. 31, 2014 | 17,275,000 | (1,708,000) | 15,566,599 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (891) | $ (891) | ||||
Issuance of common stock upon the exercise of stock options | $ 2 | 472 | $ 474 | |||
Issuance of common stock upon the exercise of stock options (in shares) | 94,000 | 94,000 | ||||
Net issuance of restricted stock awards | $ (1) | $ (1) | ||||
Net issuance of restricted stock awards (in shares) | (17,000) | |||||
Equity based compensation | 487 | 487 | ||||
Stock options and awards - excess tax benefits | (60) | (60) | ||||
Translation adjustments, net of tax | (1,462) | (1,462) | ||||
Balance at Dec. 31, 2015 | $ 347 | $ 45,753 | $ 30,574 | $ (2,778) | $ (5,836) | $ 68,060 |
Balance (in shares) at Dec. 31, 2015 | 17,352,000 | (1,708,000) | 15,644,729 |
CONSOLIDATED STATEMENTS OF CHA7
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY [Abstract] | ||
Translation adjustments, tax | $ 944 | $ 476 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | ||
Net loss | $ (891) | $ (3,651) |
Loss from discontinued operations | 4,912 | 3,722 |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Loss on Investment | 776 | 0 |
Depreciation, amortization and accretion | 3,070 | 2,007 |
Provision for bad debts | 772 | 340 |
Provision for obsolete inventory | 1,293 | 2,232 |
Equity based compensation | 487 | 1,185 |
Change in fair value of contingent consideration | 90 | 0 |
Deferred income tax | (1,910) | 516 |
Changes in operating assets and liabilities, net of acquisitions: | ||
Accounts receivable | (628) | (700) |
Inventories | 3,136 | (3,826) |
Income tax receivable/(payable) | (196) | 290 |
Other current assets | 210 | (1,129) |
Other assets | (644) | (368) |
Accounts payable | (7,529) | 3,022 |
Accrued salaries and benefits | 1 | (425) |
Accrued expenses | 213 | 4,572 |
Customer deposits | (1,062) | 1,060 |
Deferred service revenue | 251 | 645 |
Other long-term liabilities | (54) | 93 |
Deferred tax equity based compensation | (60) | 0 |
Net cash provided by operating activities-continuing operations | 2,237 | 9,585 |
Net cash used in operating activities-discontinued operations | (1,643) | (3,324) |
Net cash (used in) provided by operating activities | 594 | 6,261 |
Cash flows from investing activities: | ||
Capital expenditures | (1,705) | (1,536) |
Capitalization of software costs | (2,148) | (1,650) |
Investment expenditure | (776) | 0 |
Payments for acquisition, net of cash acquired | 0 | (5,000) |
Proceeds from sale of business | 12,100 | 0 |
Net cash provided by (used in) investing activities-continuing operations | 7,471 | (8,186) |
Net cash used in investing activities -discontinued operations | (1,046) | (1,816) |
Net cash provided by (used in) investing activities | 6,425 | (10,002) |
Cash flows from financing activities: | ||
Payments of long-term debt | (173) | (165) |
Payments of other borrowings | (222,156) | (18,921) |
Proceeds from other borrowings | 217,156 | 23,921 |
Payments for deferred acquisition obligations | (3,000) | 0 |
Proceeds from stock awards | 473 | 2 |
Net cash (used in) provided by financing activities | (7,700) | 4,837 |
Effect of exchange rate changes on cash and cash equivalents | (1,462) | (944) |
Net (decrease) increase in cash and cash equivalents | (2,143) | 152 |
Cash and cash equivalents at beginning of period | 10,167 | 10,015 |
Cash and cash equivalents at end of period | 8,024 | 10,167 |
Less cash and equivalents of discontinued operations at end of period | 0 | 300 |
Cash and equivalents of continuing operations at end of period | 8,024 | 9,867 |
Cash paid during the period for: | ||
Interest | 206 | 129 |
Income taxes, net of refunds | 310 | 722 |
Supplemental disclosures of non-cash information: | ||
Acquisition through notes payable | 0 | 4,820 |
Contingent consideration payable in connection with acquisition | 0 | 5,040 |
Sale of business through receivable | $ 3,320 | $ 0 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 1 — Summary of Significant Accounting Policies Basis of consolidation The consolidated financial statements include the accounts of PAR Technology Corporation and its subsidiaries (ParTech, Inc., ParTech (Shanghai) Company Ltd., PAR Springer-Miller Systems, Inc., Springer-Miller Canada, ULC, PAR Canada ULC, PAR Government Systems Corporation and Rome Research Corporation, Brink Software, Inc.), collectively referred to as the “Company.” All significant intercompany transactions have been eliminated in consolidation. During the third quarter of fiscal year 2015, the Company performed a strategic analysis of its current product and business unit offerings and as a result, entered into an asset purchase agreement to sell substantially all of the assets of its hotel/spa technology business operated under PAR Springer-Miller Systems, Inc. (“PSMS”) to affiliates of Constellation Software Inc. This transaction closed on November 4, 2015. Accordingly, the results of operations of PSMS have been classified as discontinued operations in accordance with Accounting Standards Codification (“ASC”) 205-20, Presentation of Financial Statements – Discontinued Operations. All prior period amounts have been reclassified to conform to the current period presentation. Refer to Note 3 “Discontinued Operations” in the Notes to the Consolidated Financial Statements for further discussion. Business combinations The Company accounts for business combinations pursuant ASC 805, Business Combinations, which requires that assets acquired and liabilities assumed be recorded at their respective fair values on the date of acquisition. The fair value of the consideration paid is assigned to the underlying net assets of the acquired business based on their respective fair values. Any excess of the purchase price over the estimated fair values of the net assets acquired is allocated to goodwill (the “Acquisition Method”). The purchase price allocation process requires the Company to make significant assumptions and estimates in determining the purchase price and the assets acquired and liabilities assumed at the acquisition date. The Company’s assumptions and estimates are subject to refinement and, as a result, during the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon conclusion of the measurement period, any subsequent adjustments are recorded to the Company’s consolidated statements of operations. The Company’s consolidated financial statements and results of operations reflect an acquired business after the completion of the acquisition. Contingent Consideration The Company determines the acquisition date fair value of contingent consideration ASC Topic 820, Fair Value Measurement. Changes in the fair value of the contingent consideration obligations may result from changes in probability assumptions with respect to the likelihood of achieving the various contingent payment obligations. Revenue recognition policy Our hospitality segment’s revenues consist of sales of the Company’s standard POS system to the hospitality segment. We derive revenue from the following sources: (1) hardware sales, (2) software license agreements, including perpetual licenses and software as a service, (3) professional services, (4) hosting services and (5) post-contract customer support ("PCS"). We recognize revenue when all four revenue recognition criteria have been met: persuasive evidence of an arrangement exists, we have delivered the product or performed the service, the fee is fixed or determinable and collection is probable. Determining whether and when some of these criteria have been satisfied often involves assumptions and judgments that can have a significant impact on the timing and amount of revenue we report. Hardware Revenue recognition on hardware sales occurs upon delivery to the customer site (or when shipped for systems that are not installed by the Company) when persuasive evidence of an arrangement exists, delivery has occurred, the price is fixed or determinable, and collectability is reasonably assured. Software Revenue recognition on software sales generally occurs upon delivery to the customer, when persuasive evidence of an arrangement exists, the price is fixed or determinable, and collectability is probable. For software sales sold as a perpetual license, typical our Pixel software offering, where the Company is the sole party that has the proprietary knowledge to install the software, revenue is recognized upon installation and when the system is ready to go live. Service Service revenue consists of installation and training services, field and depot repair, subscription software products, associated software maintenance, and software related hosted services. Installation and training service revenue are based upon standard hourly/daily rates as well as contracted prices with the customer, and revenue is recognized as the services are performed. Support maintenance and field and depot repair are provided to customers either on a time and materials basis or under a maintenance contract. Services provided on a time and materials basis are recognized as the services are performed. Service revenues from maintenance contracts are recorded as deferred revenue when billed to the customer and are recognized ratably over the underlying contract period. Software sold as a service with our Brink and SureCheck software offerings, is recognized based on the contracted price over its contract term. PAR frequently enters into multiple-element arrangements with its customers including hardware, software, professional consulting services and maintenance support services. For arrangements involving multiple deliverables, when deliverables include software and non-software products and services, PAR evaluates and separates each deliverable to determine whether it represents a separate unit of accounting based on the following criteria: (a) the delivered item has value to the customer on a stand-alone basis; and (b) if the contract includes a general right of return relative to the delivered item, delivery or performance of the undelivered items is considered probable and substantially in the control of PAR. Multiple element arrangements which include hardware, service, and software offerings are separated based upon the stand alone price for each individual hardware, service, or software sold in the arrangement irrespective of the combination of products and services which are included in a particular arrangement. As such, overall consideration is allocated to each unit of accounting based on the unit's relative selling prices. In such circumstances, the Company uses a hierarchy to determine the selling price to be used for allocating revenue to each deliverable: (i) vendor-specific objective evidence of selling price (VSOE), (ii) third-party evidence of selling price (TPE), and (iii) best estimate of selling price (BESP). VSOE generally exists only when the Company sells the deliverable separately and is the price actually charged by the Company for that deliverable. The Company uses BESP to allocate revenue when we are unable to establish VSOE or TPE of selling price. BESP is primarily used for elements such as products that are not consistently priced within a narrow range. The Company determines BESP for a deliverable by considering multiple factors including product and customer class, geography, average discount, and management's historical pricing practices. Amounts allocated to the delivered hardware and software elements are recognized at the time of sale provided the other conditions for revenue recognition have been met. Amounts allocated to the undelivered maintenance and other services elements are recognized as the services are provided or on a straight-line basis over the service period. In certain instances, customer acceptance is required prior to the passage of title and risk of loss of the delivered products. In such cases, revenue is not recognized until the customer acceptance is obtained. Delivery and acceptance generally occur in the same reporting period. In situations where PAR’s solutions contain software related services (generally PCS and professional services), revenue is recognized in accordance with authoritative guidance on software revenue recognition. For the software and software-related elements of such transactions, revenue is allocated based on the relative fair value of each element, and fair value is determined by vender specific objective evidence (VSOE), where available. If VSOE is not available for all elements, we will use the residual method to separate the elements as long as we have VSOE for the undelivered elements. If the Company cannot objectively determine the fair value of any undelivered element included in such multiple-element arrangements, the Company defers the revenue until all elements are delivered and services have been performed, or until fair value can objectively be determined for any remaining undelivered elements. Government Contracts The Company’s contract revenues generated by the Government segment result primarily from contract services performed for the U.S. Government under a variety of cost-plus fixed fee, time-and-material, and fixed-price contracts. Revenue on cost-plus fixed fee contracts is recognized based on allowable costs for labor hours delivered, as well as other allowable costs plus the applicable fee. Revenue on time and material contracts is recognized by multiplying the number of direct labor hours delivered in the performance of the contract by the contract billing rates and adding other direct costs as incurred. Revenue from fixed-price contracts is recognized as labor hours are delivered which approximates the straight-line basis of the life of the contract. The Company’s obligation under these contracts is to provide labor hours to conduct research or to staff facilities with no other deliverables or performance obligations. Anticipated losses on all contracts are recorded in full when identified. Unbilled accounts receivable are stated in the Company’s consolidated financial statements at their estimated realizable value. Contract costs, including indirect expenses, are subject to audit and adjustment through negotiations between the Company and U.S. Government representatives. Warranty Provisions Warranty provisions for product warranties are recorded in the period in which PAR becomes obligated to honor the related right, which generally is the period in which the related product revenue is recognized. The Company accrues warranty reserves based upon historical factors such as labor rates, average repair time, travel time, number of service calls per machine and cost of replacement parts. When a sale is consummated, a warranty reserve is recorded based upon the estimated cost to provide the service over the warranty period. Cash and cash equivalents The Company considers all highly liquid investments, purchased with a remaining maturity of three months or less, to be cash equivalents. Accounts receivable – Allowance for doubtful accounts Allowances for doubtful accounts are based on estimates of probable losses related to accounts receivable balances. The establishment of allowances requires the use of judgment and assumptions regarding probable losses on receivable balances. The Company continuously monitors collections and payments from our customers and maintain a provision for estimated credit losses based on our historical experience and any specific customer collection issues that we have identified. Thus, if the financial condition of our customers were to deteriorate, our actual losses may exceed our estimates, and additional allowances would be required. Inventories The Company’s inventories are valued at the lower of cost or market, with cost determined using the first-in, first-out (“FIFO”) method. The Company uses certain estimates and judgments and considers several factors including product demand, changes in customer requirements and changes in technology to provide for excess and obsolescence reserves to properly value inventory. Property, plant and equipment Property, plant and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the assets, which range from three to twenty-five years. Expenditures for maintenance and repairs are expensed as incurred. Other assets Other assets primarily consist of cash surrender value of life insurance related to the Company’s Deferred Compensation Plan eligible to certain employees. The funded balance is reviewed on an annual basis. Income taxes The provision for income taxes is based upon pretax earnings with deferred income taxes provided for the temporary differences between the financial reporting basis and the tax basis of the Company’s assets and liabilities. The Company records a valuation allowance when necessary to reduce deferred tax assets to their net realizable amounts. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Other long-term liabilities Other long-term liabilities represent amounts owed to certain employees who are participants in the Company’s Deferred Compensation Plan and the estimated fair value of the contingent consideration payable related to the Brink Software Inc. acquisition. Foreign currency The assets and liabilities for the Company’s international operations are translated into U.S. dollars using year-end exchange rates. Income statement items are translated at average exchange rates prevailing during the year. The resulting translation adjustments are recorded as a separate component of shareholders’ equity under the heading Accumulated Other Comprehensive Loss. Exchange gains and losses on intercompany balances of permanently invested long-term loans are also recorded as a translation adjustment and are included in Accumulated Other Comprehensive Loss. Foreign currency transaction gains and losses are recorded in other income in the accompanying statements of operations. Other (expense) income The components of other (expense) income from continuing operations for the two years ending December 31 are as follows: Year ended December 31 (in thousands) 2015 2014 Foreign currency loss $ (193 ) $ (115 ) Rental income-net 264 359 Investment write-off (776 ) - Other (95 ) 241 $ (800 ) $ 485 The investment write-off of $776,000 in fiscal year 2015 represents the write-off of unauthorized investments that were made in contravention of the Company’s policies and procedures involving the Company’s funds. The unauthorized investments occurred during the period between September 25, 2015 and November 6, 2015. As of December 31, 2015, the Company is uncertain of the collectability of funds relating to these investments and as a result, reduced its fair value to zero. The write-off of the investment resulted in the Company identifying a material weakness over financial reporting as described in Item 9A. Identifiable intangible assets The Company’s identifiable intangible assets represent intangible assets acquired from the Brink Software Inc. acquisition as well as internally developed software costs. The Company capitalizes certain costs related to the development of computer software sold by its hospitality segment. Software development costs incurred prior to establishing technological feasibility are charged to operations and included in research and development costs. Software development costs incurred after establishing feasibility (as defined within ASC 985-20 for software cost related to sold as a perpetual license and ASC-350-40 for software sold as a service) are capitalized and amortized on a product-by-product basis when the product is available for general release to customers. Software costs capitalized within continuing operations during the periods ended December 31, 2015 and 2014 were $2.1 million and $1.7 million, respectively. Annual amortization, charged to cost of sales when the product is available for general release to customers, is computed using the greater of (a) the straight-line method over the remaining estimated economic life of the product, generally three to seven years or (b) the ratio that current gross revenues for a product bear to the total of current and anticipated future gross revenues for that product. Amortization of capitalized software costs from continuing operations amounted to $843,000 and $673,000, in 2015 and 2014, respectively. The Company assessed its recoverability of capitalized software assets noting no impairments were recorded in 2015 or 2014. In 2014, the Company acquired identifiable intangible assets in connection with its acquisition of Brink Software Inc. Amortization of intangible assets acquired from the Brink Software Inc. acquisition amounted to $987,000 and $279,000 in 2015 and 2014, respectively. The components of identifiable intangible assets, excluding discontinued operations, are: December 31, (in thousands) 2015 2014 Estimated Useful Life Acquired and internally developed software costs $ 12,725 $ 10,577 3 - 7 years Customer relationships 160 160 7 years Non-competition agreements 30 30 1 year 12,915 10,767 Less accumulated amortization (2,417 ) (587 ) $ 10,498 $ 10,180 Trademarks, trade names (non-amortizable) 400 400 N/A $ 10,898 $ 10,580 The expected future amortization of these intangible assets assuming straight-line amortization of capitalized software costs and acquisition related intangibles is as follows (in thousands): 2016 $ 2,012 2017 1,911 2018 1,747 2019 1,350 2020 1,174 Thereafter 2,304 Total $ 10,498 The Company has elected to test for impairment of indefinite lived intangible assets during the fourth quarter of its fiscal year. To value the indefinite lived intangible assets, the Company utilizes the royalty method to estimate the fair values of the trademarks and trade names. As a result of the testing, there was no related impairment charge recorded for the periods ended December 31, 2015 and 2014. Stock-based compensation The Company recognizes all stock-based compensation to employees, including grants of employee stock options and restricted stock awards, in the financial statements as compensation cost over the vesting period using an accelerated expense recognition method, based on their fair value on the date of grant. Earnings per share Basic earnings per share are computed based on the weighted average number of common shares outstanding during the period. Diluted earnings per share reflect the dilutive impact of outstanding stock options and restricted stock awards. The following is a reconciliation of the weighted average shares outstanding for the basic and diluted earnings per share computations (in thousands, except share and per share data): December 31, 2015 2014 Income from continuing operations $ 4,021 $ 71 Basic: Shares outstanding at beginning of year 15,592 15,473 Weighted average shares (cancelled) issued during the year, net (30 ) 28 Weighted average common shares, basic 15,562 15,501 Income from continuing operations per common share, basic $ 0.26 $ 0.00 Diluted: Weighted average common shares, basic 15,562 15,501 Dilutive impact of stock options and restricted stock awards 104 81 Weighted average common shares, diluted 15,666 15,582 Income from continuing operations per common share, diluted $ 0.26 $ 0.00 At December 31, 2015 and 2014 there were 112,000 and 215,000 incremental shares, respectively, from the assumed exercise of stock options that were excluded from the computation of diluted earnings per share because of the anti-dilutive effect on earnings per share. There were no restricted stock awards excluded from the computation of diluted earnings per share for each of the fiscal years ended December 31, 2015 and 2014. Goodwill The Company tests goodwill for impairment on an annual basis, which is on the first day of the fourth quarter, or more often if events or circumstances indicate there may be impairment. The Company operates in two reportable segments, referred to as business segments, Hospitality and Government. Goodwill impairment testing is performed at the sub-segment level (referred to as a reporting unit). The two reporting units utilized by the Company are: Restaurant and Government. The Hotel/Resort/Spa reporting unit was sold on November 4, 2015 and included within discontinued operations. Goodwill is assigned to reporting units at the date the goodwill is initially recorded. Once goodwill has been assigned to reporting units, it no longer retains its association with a particular acquisition, and all of the activities within a reporting unit, whether acquired or organically grown, are available to support the value of the goodwill. The amount outstanding for goodwill within continuing operations was $11.1 million at December 31, 2015 and 2014. During fiscal 2015, the decrease was a result of the divestiture of the hotel/resort/spa reporting unit. As a result of the fair value received for the Hotel/Resort/Spa divestiture, the Company recorded an impairment charge within discontinued operations of $2.4 million. During fiscal 2014, the increase was a result of $10.3 million of goodwill recorded by the Restaurant reporting unit from the acquisition of Brink Software Inc. There was no The changes and carrying amounts of goodwill by reporting unit were as follows (in thousands): Restaurants Hotel/Resort/ Spa Government Total Net Balances at December 31, 2013 $ - $ 6,116 $ 736 $ 6,852 Goodwill 12,433 13,946 736 27,115 Accumulated Impairment charge (12,433 (7,830 ) - (20,263 ) Acquisition 10,315 - - 10,315 Reclassified to Discontinued Operations - (6,116 ) - (6,116 ) Net balance at December 31, 2014 10,315 - 736 11,051 Goodwill 22,748 13,946 736 37,430 Accumulated Impairment charge (12,433 (10,238 ) - (22,671 ) Divestiture - (3,708 ) - (3,708 ) Net balance at December 31, 2015 $ 10,315 $ - $ 736 $ 11,051 Impairment of long-lived assets The Company evaluates the accounting and reporting for the impairment of long-lived assets in accordance with the reporting requirements of ASC 360-10, Accounting for the Impairment or Disposal of Long-Lived Assets. The Company will recognize impairment of long-lived assets or asset groups if the net book value of such assets exceeds the estimated future undiscounted cash flows attributable to such assets. If the carrying value of a long-lived asset or asset group is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds the fair market value of the long-lived asset or asset group for assets to be held and used, or the amount by which the carrying value exceeds the fair market value less cost to sell for assets to be sold. No impairment was identified during 2015 or 2014. Reclassifications Amounts in prior years’ consolidated financial statements are reclassified whenever necessary to conform to the current year’s presentation. The results of operations of PSMS have been classified as discontinued operations in accordance with Accounting Standards Codification (“ASC”) 205-20, Presentation of Financial Statements – Discontinued Operations. All prior period amounts have been reclassified to conform to the current period presentation. Refer to Note 3 “Discontinued Operations” in the Notes to the Consolidated Financial Statements for further discussion. Use of estimates The preparation of the consolidated financial statements requires management of the Company to make a number of estimates and assumptions relating to the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Significant items subject to such estimates and assumptions include revenue recognition, stock based compensation, the recognition and measurement of assets acquired and liabilities assumed in business combinations at fair value, the carrying amount of property, plant and equipment, identifiable intangible assets and goodwill, valuation allowances for receivables, inventories and deferred income tax assets, and measurement of contingent consideration at fair value. Actual results could differ from those estimates. Recently Issued Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued new guidance related to leases. This standard requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. The new standard is effective for the Company for the fiscal years beginning after December 15, 2018, with early adoption permitted. The Company is evaluating the impact the adoption of this standard will have on its consolidated financial statements. In November 2015, the FASB issued new guidance related to the balance sheet classification of deferred taxes. This standard requires an entity to classify all deferred tax assets, along with any valuation allowance, as noncurrent on the balance sheet. As a result, each jurisdiction will have one net noncurrent deferred tax asset or liability. The new standard is effective for the Company for fiscal years beginning after December 15, 2016. The adoption of this standard, which may be applied either prospectively or retrospectively, is not expected to have a material impact on the Company’s consolidated financial statements. In July 2015, the FASB issued new guidance related to the measurement of inventory. This standard changes the inventory valuation method from the lower of cost or market to the lower of cost or net realizable value for inventory valued under the first-in, first-out or average cost methods. The new standard is effective for the Company beginning in its first quarter of fiscal 2017, and requires prospective adoption with early adoption permitted. The Company is evaluating the impact the adoption of this standard will have on its consolidated financial statements. In April 2015, the FASB issued new guidance related to the presentation of debt issuance costs, which amends existing guidance to require the presentation of debt issuance costs in the balance sheet as a deduction from the carrying amount of the related debt liability, consistent with debt discounts, instead of a deferred charge asset. The new standard is effective for the Company beginning in its first quarter of fiscal 2016, with early adoption permitted. The Company is evaluating the impact the adoption of this standard and it is not expected to have a material impact on our consolidated financial statements. In April 2015, the FASB issued new guidance related to accounting for the fees paid in a cloud computing arrangement, which provides guidance to customers about whether a cloud computing arrangement includes a software license. If considered a software license, the arrangement should be accounted for as an acquisition of a software license. If not considered a software license, the arrangement should be accounted for as a service contract. The new standard is effective for the Company beginning in its first quarter of fiscal 2016, with early adoption permitted. The Company is evaluating the impact the adoption of this standard and it is not expected to have a material impact on our consolidated financial statements In September 2014, the FASB issued amended guidance on the accounting for certain share-based employee compensation awards. The amended guidance requires that share-based employee compensation awards with terms of a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award and compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved. The Company is required to adopt this guidance for its annual and interim periods beginning March 1, 2016. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. In August 2014, the FASB issued new guidance related to disclosures around going concern, including management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related disclosures when conditions or events raise substantial doubt about an entity's ability to continue as a going concern. The new standard is effective for the Company beginning in its first quarter of fiscal 2017, with early adoption permitted. The impact of adopting this guidance on January 1, 2017 is not expected to have a material impact on our consolidated financial statements. In May 2014, the FASB amended the existing accounting standards for revenue recognition. The amendments are based on the principle that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance provides a five-step analysis of transactions to determine when and how revenue is recognized. The guidance also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. In July 2015, the FASB affirmed its proposal of a one-year deferral of the effective date of the new revenue standard. As a result, the new guidance will be effective for the Company beginning in its first quarter of fiscal 2018. The amendments may be applied retrospectively to each prior period presented or with the cumulative effect recognized as of the date of initial application. PAR is currently evaluating the impact of these amendments and the transition alternatives on PAR's financial statements. Recently Adopted Accounting Pronouncements In April 2014, the FASB issued guidance that raises the threshold for a disposal to qualify as a discontinued operation and requires new disclosures of both discontinued operations and other disposals that do not meet the definition of a discontinued operations. The new guidance defines a discontinued operation as a disposal of a component or group of components that is disposed of or is classified as held for sale and represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results. The new guidance is effective on January 1, 2015, with early adoption permitted. The adoption of this amendment on January 1, 2015 did not have a significant impact on the Company's financial position or results of operations. |
Acquisition
Acquisition | 12 Months Ended |
Dec. 31, 2015 | |
Acquisition [Abstract] | |
Acquisition | Note 2 — Acquisition On September 18, 2014, PAR Technology Corporation (the "Company") and its wholly-owned subsidiary, ParTech, Inc. ("ParTech"), entered into and closed a definitive agreement with Brink Software Inc. ("Brink") and all the shareholders of Brink pursuant to which ParTech has purchased the equity interest of Brink in a two-step closing. This acquisition was to expand the Company’s cloud based POS software offerings. The guaranteed portion of the purchase price for Brink’s shares will total $10 million in cash, which is payable over a period of three years with $5.0 million paid at closing, $3.0 million paid on the first year anniversary of close, and $2.0 million payable on the second year anniversary of close. In addition to the guaranteed payments, there is a contingent consideration of up to $7.0 million payable to the former owners of Brink based on the achievement of certain conditions as defined in the definitive agreement. The payment of $5.0 million on September 18, 2014, was for the purchase of 51% of Brink’s outstanding shares. The remaining 49% was purchased and transferred on September 18, 2015, the first anniversary of the initial closing date, for a purchase price of $5.0 million, $3.0 million of which was paid on the second closing and the $2.0 million balance will be payable on September 18, 2016. The estimated fair value of the remaining portion of the note payable due on September 18, 2016 is approximately $1.9 million and is included within current debt in PAR’s consolidated balance sheets. Per the stock purchase agreement, Brink shareholders assigned their voting rights of the remaining 49% of Brink shares to PAR. As a result, PAR controlled 100% of the Brink shares prior to the transfer on September 18, 2015 and fully consolidated the financial results of Brink in accordance with ASC Topic 805. The agreement also provided up to $1.0 million of the purchase price to be delivered into escrow if one or more claims arise within the first twelve months of the transaction. Such escrow served as a source of payment for any indemnification obligations that may arise. No such claims arose within the first twelve months of the transaction. The contingent purchase price maximum of $7.0 million can be earned through fiscal year 2018, based upon the achievement of certain conditions as defined in the definitive agreement. These conditions have separate targets as defined in the definitive agreement, which began on December 31, 2015. The targets for fiscal year 2015 were not met, however, the total earning potential has a cumulative effect ending fiscal year 2018. The estimated fair value of this contingent consideration is approximately $5.1 million and is included within non-current liabilities in PAR’s consolidated balance sheets (see note 13). In determining the purchase price allocation, the Company considered, among other factors, market participants’ intentions to use the acquired assets and the historical and estimated future demand for the acquired Brink POS cloud based point of sale application. The total purchase price was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed by the Company based on their fair values as of the closing date of the acquisition. The excess of the purchase price over those fair values was recorded to goodwill. The following table summarizes our allocation of purchase price (in thousands) at the measurement date, September 18, 2014: Accounts receivable $ 83 Inventories 116 Intangible assets 7,190 Goodwill 10,315 Other assets 90 Total assets acquired $ 17,794 Accounts payable $ 124 Other current liabilites 365 Deferred Tax Liabilities 2,445 Total liabilities assumed $ 2,934 Purchase price $ 14,860 The identifiable intangible assets acquired and their estimated useful lives (based on third party valuations) are as follows (in thousands): Fair Value Estimated Trade name $ 400 Indefinite Developed technology 6,600 7 Years Customer relationships 160 7 Years Non-competition agreements 30 1 Year $ 7,190 The intangible assets are being amortized on a straight line basis, which is consistent with the pattern that the economic benefits of the intangible assets are expected to be utilized based on the estimated cash flows generated from such assets. The Company recognized approximately $987,000 and $279,000 of amortization expense related to the amortizable intangible assets at December 31, 2015 and 2014, respectively, based on the aforementioned estimates. On an unaudited proforma basis, assuming the completed acquisition had occurred as of the beginning of the periods presented, the consolidated results from continuing operations of the Company would have been as follows (in thousands, except per share amounts): (Unaudited) Year ended December 31, 2014 Revenues $ 219,328 Net loss $ (559 ) Earnings per share: Basic $ (0.04 ) Diluted $ (0.04 ) The unaudited proforma financial information presented above gives effect to purchase accounting adjustments which have resulted or are expected to result from the acquisition. This proforma information is not necessarily indicative of the results that would actually have been obtained had the companies combined for the periods presents. The Company has recognized transaction, integration, and other acquisition related costs of approximately $163,000 through December 31, 2014, which have been recorded within sales, general, and administration expense within the Company’s consolidated statements of operations. Additionally, the results of the Brink acquisition acquired in 2014 contributed $832,000 to PAR’s revenue and reduced PAR’s net income from continuing operations by $145,000 in 2014. T he results of operations of the Brink acquisition is reported in the Company’s consolidated results of operations of the Company from the date of acquisition. |
Divestiture and Discontinued Op
Divestiture and Discontinued Operations | 12 Months Ended |
Dec. 31, 2015 | |
Divestiture and Discontinued Operations [Abstract] | |
Divestiture and Discontinued Operations | Note 3 — Divestiture and Discontinued Operations On November 4, 2015, ParTech, Inc. (“PTI”), a wholly owned subsidiary of PAR Technology Corporation, PAR Springer-Miller Systems, Inc. (“PSMS”), Springer-Miller International, LLC (“SMI”), and Springer-Miller Canada, ULC (“SMC”) (PTI, PSMS, SMI and SMC are collectively referred to herein as the “Group”), entered into an asset purchase agreement (the “APA”) with Gary Jonas Computing Ltd., SMS Software Holdings LLC, and Jonas Computing (UK) Ltd. (the “Purchasers”), each of which is an affiliate of the Jonas Software Group of Constellation Software Inc. of Toronto, Ontario, for the sale of substantially all of the assets of PSMS. Total consideration to be received from the sale is $16.6 million in cash (the “Base Purchase Price”), with $12.1 million received at the time of closing, and $4.5 million receivable eighteen months after the closing date, a portion of which amount will be available to pay certain indemnification obligations of the group. The estimated fair value of the remaining portion of the note receivable, less any estimated working capital adjustments, due on May 4, 2017 is approximately $3.3 million and is included within noncurrent assets in PAR’s consolidated balance sheets. In addition to the base purchase price, contingent consideration of up to $1,500,000 is receivable by PAR based on achievement of certain agreed-upon revenue and earnings targets for calendar years 2016 through 2018, as set forth in the APA. As of December 31, 2015, the Company has not recorded any amount associated with this contingent consideration as it does not believe achievement of the related targets is probable. Summarized financial information for the Company’s discontinued operations is as follows (in thousands): December 31, December 31, Assets Cash $ - $ 300 Accounts receivable - net - 1,771 Other current assets - 574 Property, plant and equipment - net - 986 Goodwill - 6,116 Intangible assets - net - 12,372 Assets of discontinued operation $ - $ 22,119 Liabilities Accounts Payable $ - $ 417 Accrued salaries and benefits 441 703 Accrued expenses - 87 Customer Deposits - 1,103 Deferred service revenue - 2,307 Liabilities of discontinued operation $ 441 $ 4,617 Summarized financial information for the Company’s discontinued operations is as follows (in thousands): December 31, 2015 2014 Total revenues $ 14,545 $ 15,746 Loss from discontinued operations before income taxes $ (5,702 ) $ (5,816 ) Loss on disposition (2,408 ) - Benefit from income taxes 3,198 2,094 Loss from discontinued operations, net of taxes $ (4,912 ) $ (3,722 ) |
Accounts Receivable, net
Accounts Receivable, net | 12 Months Ended |
Dec. 31, 2015 | |
Accounts Receivable, net [Abstract] | |
Accounts Receivable | Note 4 — Accounts Receivable, net The Company’s net accounts receivable consist of, excluding discontinued operations: December 31, (in thousands) 2015 2014 Government segment: Billed $ 9,400 $ 9,340 Advanced billings (1,266 ) (450 ) 8,134 8,890 Hospitality segment: Accounts receivable - net 21,396 20,784 $ 29,530 $ 29,674 At December 31, 2015,2014 and 2013, the Company had recorded allowances for doubtful accounts of $875, 000, $484,000 and $422,000, respectively, against hospitality segment accounts receivable. Write-offs of accounts receivable during fiscal years 2015 and 2014 were $382,000 and $278,000, respectively. The provision for doubtful accounts recorded in the consolidated statements of operations was $772,000 and $340,000 in 2015 and 2014, respectively. |
Inventories, net
Inventories, net | 12 Months Ended |
Dec. 31, 2015 | |
Inventories, net [Abstract] | |
Inventories | Note 5 — Inventories, net Inventories are used in the manufacture and service of hospitality products. The components of inventory, net consist of the following, excluding discontinued operations: December 31, (in thousands) 2015 2014 Finished Goods $ 8,775 $ 13,615 Work in process 402 457 Component parts 5,068 3,748 Service parts 7,254 8,108 $ 21,499 $ 25,928 December 31, 2015 and December 31, 2014, the Company had recorded inventory reserves of $8.6 million and $7.9 million, respectively, against Hospitality inventories, which relates primarily to service parts. |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Note 6 — Property, Plant and Equipment The components of property, plant and equipment, excluding discontinued operations, are: December 31, (in thousands) 2015 2014 Land $ 253 $ 253 Building and improvements 5,645 5,645 Rental property 5,330 5,308 Furniture and equipment 11,804 10,160 23,032 21,366 Less accumulated depreciation (17,316 ) (16,218 ) $ 5,716 $ 5,148 The estimated useful lives of buildings and improvements and rental property are twenty to twenty-five years. The estimated useful lives of furniture and equipment range from three to eight years. Depreciation expense from continuing operations was $1,137,000 and $1,052,000 for 2015 and 2014, respectively. The Company leases a portion of its headquarters facility to various tenants. Net rent received from these leases totaled $264,000 and $359,000 for 2015 and 2014, respectively. Future minimum rent payments due to the Company under these lease arrangements are approximately $306,000, $246,000 and $57,000 in 2016, 2017 and 2018, respectively. The Company leases office space under various operating leases. Rental expense from continuing operations on operating leases was approximately $1.4 million and $1.3 million for 2015 and 2014, respectively. Future minimum lease payments under all non-cancelable operating leases are (in thousands): 2016 1,466 2017 1,149 2018 924 2019 860 2020 336 Thereafter 738 $ 5,473 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2015 | |
Debt [Abstract] | |
Debt | Note 7 — Debt Through June 4, 2014, the Company maintained a credit facility with J.P. Morgan Chase, N.A. and NBT Bank, N.A. (on behalf of itself and as successor by merger to Alliance Bank, N.A.) consisting of $20.0 million in working capital lines of credit (with the option to increase to $30.0 million), which expired in June 2014. This agreement allowed the Company, at its option, to borrow funds at the LIBOR rate plus the applicable interest rate spread or at the bank's prime lending rate. This credit facility was secured by certain assets of the Company. On June 5, 2014, the Company executed an amendment to its then existing credit facility to provide for the renewal of the facility through June 2017, with terms generally consistent to those of its prior facility. This facility provided the Company with capital of up to $20.0 million (with the option to increase to $30.0 million) in the form of a revolving line of credit. This agreement allowed the Company, at its option, to borrow funds at the LIBOR rate plus the applicable interest rate spread or at the bank's prime lending rate. On September 9, 2014, the Company terminated its existing credit facilities with J.P. Morgan Chase, N.A. and NBT Bank, N.A. (on behalf of itself and as successor by merger to Alliance Bank, N.A.) consisting of $20.0 million in working capital lines of credit, and the Company and its domestic subsidiaries entered into a new three-year credit facility with J.P. Morgan Chase, N.A (the Credit Facility). The terms of the Credit Facility provide for up to $25 million of a line of credit, with borrowing availability based on a percentage of value of various assets of the Company and its subsidiaries. The new agreement bears interest at the applicable bank rate (3.25% at December 31, 2015) or, at the Company's option, at the LIBOR rate plus the applicable interest rate spread (range of 1.5% – 2.0%). At December 31, 2015, the Company did not have any outstanding balance on this line of credit. The weighted average interest rate paid by the Company was approximately 3.50% during fiscal year 2015. The new agreement contains traditional asset based loan covenants and includes covenants regarding earnings before interest, tax, depreciation & amortization (“EBITDA”) and a fixed charge coverage ratio, and provides for acceleration upon the occurrence of customary events of defaults. On March 19, 2015, the Company amended the Credit Facility to reduce the EBITDA requirement and extend the fixed charge coverage ratio. The amendment provides the Company flexibility to continue investing in the Company’s future product offerings while maintaining certain covenant thresholds as defined in the amendment. On March 16, 2016, the Company received a notice of defaults under its current Credit Facility due to unauthorized investments made during 2015 by the company’s former Chief Financial Officer, which were not permitted investments as defined in the lending agreement. See Note 1, “Summary of Significant Accounting Policies,” to the Consolidated Financial Statements for further discussion on these unauthorized investments. These unauthorized investments involved cash transfers totaling $776,000, which amounts have been written off by the Company as of December 31, 2015 (the “Unauthorized Transactions”). On March 24, 2016 the lender provided waivers of the defaults, subject to certain terms and conditions contained in the waiver, including entry by the Company into a fourth amendment to the Company’s Credit Agreement. On March 24, 2016, based on the waiver received, the Company executed the fourth amendment to its existing Credit Agreement. Under the terms and conditions of this amendment, the Company has undertaken to engage, and has engaged, an independent consultant to review its internal controls relating to financial reporting and authorization procedures for financial transactions (including, without limitation, investments) initiated by the Company’s officers (the “Internal Control Review”). The company has agreed to deliver to the lender a report prepared by Company’s consultant that sets forth, in reasonable detail, the results of the Internal Control Review, together with a summary of any recommended changes to the Company’s internal control procedures (the “ICR Report”). To the extent the ICR Report sets forth recommended changes to Borrowers’ internal control procedures (“IC Recommendations”), The Company has agreed to promptly take steps to implement the IC Recommendations in all material respects. The Company has agreed to provide periodic updates to the lender relating to the Internal Control Review, implementation of IC Recommendations and any ongoing investigations related to the Unauthorized Transactions In addition to the credit facility described above, the Company has a mortgage loan, collateralized by certain real estate, with a balance of $746,000 and $919,000 at December 31, 2015 and 2014, respectively. This mortgage matures on November 1, 2019. The Company's fixed interest rate was 4.05% through October 1, 2014. Beginning on October 1, 2014, the fixed rate was converted to a new rate equal to the then-current five year fixed advanced rate charged by the New York Federal Home Loan bank, plus 225 basis points. Effective November 1, 2014, the Company entered into an agreement that fixed the interest rate at 4.00% through the maturity date of the loan. The annual mortgage payment including interest through November 1, 2019 totals $206,000. In connection with the acquisition of Brink Software on September 18, 2014, the Company recorded indebtedness to the former owners of Brink under the stock purchase agreement. At December 31, 2015 and 2014, the principal balance of the note payable was $2.0 million and $5.0 million and it had a carrying value of $1.9 million and $4.8 million, respectively. The carrying value was based on the note’s estimated fair value at the time of acquisition. The note does not bear interest and repayment terms are $3.0 million, which was paid on the first anniversary of close, September 18, 2015, and $2.0 million payable on the second anniversary of close, September 18, 2016. The Company’s future principal payments under the stock purchase agreement and its mortgage are as follows (in thousands): 2016 $ 2,103 2017 188 2018 195 2019 183 $ 2,669 |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Dec. 31, 2015 | |
Stock Based Compensation [Abstract] | |
Stock Based Compensation | Note 8 — Stock Based Compensation The Company recognizes all stock-based compensation to employees and directors, including grants of employee stock options and restricted stock awards, in the financial statements as compensation cost over the vesting period based on their fair value on the date of grant. Total stock-based compensation expense included in selling, general and administrative expense in 2015 and 2014 was $487,000 and $1,185,000, respectively. The amount recorded for the twelve months ended December 31, 2015 and 2014 was recorded net of benefits of $197,000 and $114,000, as the result of forfeitures of unvested stock awards prior to the completion of the requisite service period. The amount of total stock based compensation includes $182,000 and $608,000 in 2015 and 2014, respectively, relating to restricted stock awards. No compensation expense has been capitalized during 2015 and 2014. The Company has reserved 1,000,000 shares under its 2015 Equity Incentive Plan (“EIP”). Stock options under this Plan may be incentive stock options or nonqualified stock options. The Plan also provides for restricted stock awards, including performance based awards. Stock options are nontransferable other than upon death. Option grants generally vest over a one to five year period after the grant and typically expire ten years after the date of the grant. The EIP provides for the grant of several different forms of stock-based compensation, including stock options to purchase shares of PAR common stock. The Compensation Committee of the Board of Directors (Compensation Committee) has discretion to determine the material terms and conditions of option awards under the EIP, provided that (i) the exercise price must be no less than the fair market value of PAR common stock (defined as the closing price) on the date of grant, (ii) the term must be no longer than ten years, and (iii) in no event shall the normal vesting schedule provide for vesting in less than one year. Other terms and conditions of an award of stock options will be determined by the Compensation Committee as set forth in the agreement relating to that award. The Compensation Committee has authority to administer the EIP. Information with respect to stock options included within this plan is as follows: No. of Shares (in thousands) Weighted Average Exercise Price Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2014 1,240 $ 5.28 $ 1,264 Options granted 118 4.90 Options exercised (94 ) 5.04 Forfeited and cancelled (211 ) 5.09 Expired (120 ) 6.50 Outstanding at December 31, 2015 933 $ 5.14 $ 1,579 Vested and expected to vest at December 31, 2015 905 $ 5.14 $ 1,532 Total shares exercisable as of December 31, 2015 302 $ 5.14 $ 512 Shares remaining available for grant 1,000 The weighted average grant date fair value of options granted during the years 2015 and 2014 was $1.44 and $1.68, respectively. The total intrinsic value of options exercised during the year ended December 31, 2015 was $119,000. There were no options exercised during the year ended December 31, 2014. New shares of the Company’s common stock are issued as a result of stock option exercises in 2015. The fair value of options at the date of the grant was estimated using the Black-Scholes model with the following assumptions for the respective period ending December 31: 2015 2014 Expected option life 5.1 years 5.9 years Weighted average risk-free interest rate 1.6 % 1.7 % Weighted average expected volatility 30 % 31 % Expected dividend yield 0 % 0 % For the years ended December 31, 2015 and 2014, the expected option life was based on the Company’s historical experience with similar type options. Expected volatility is based on historical volatility levels of the Company’s common stock over the preceding period of time consistent with the expected life. The risk-free interest rate is based on the implied yield currently available on U.S. Treasury zero coupon issues with a remaining term equal to the expected life. Stock options outstanding at December 31, 2015 are summarized as follows: Range of Exercise Prices Number Outstanding (in thousands) Weighted Average Remaining Life Weighted Average Exercise Price $ 4.31 - $6.47 933 8.10 years $ 5.14 At December 31, 2015 the aggregate unrecognized compensation cost of unvested equity awards, as determined using a Black-Scholes option valuation model, was $758,000 (net of estimated forfeitures) which is expected to be recognized as compensation expense in fiscal years 2016 through 2018. The Company has not paid cash dividends on its common stock, and the Company presently intends to continue to retain earnings for reinvestment in growth opportunities. Accordingly, it is anticipated no cash dividends will be paid in the foreseeable future. Current year activity with respect to the Company’s non-vested restricted stock awards is as follows: Non-vested restricted stock awards (in thousands) Shares Weighted Average grant- date fair value Balance at January 1, 2015 273 $ 4.68 Granted 34 4.67 Vested (110 ) 4.71 Forfeited and cancelled (112 ) 3.95 Balance at December 31, 2015 85 $ 5.13 The EIP also provides for the issuance of restricted stock, as well as restricted stock units. These types of awards can have either service based or performance based vesting with performance goals being established by the Compensation Committee. Grants of restricted stock with service based vesting are subject to vesting periods ranging from zero to 60 months. Grants of restricted stock with performance based vesting are subject to a vesting period of 12 to 36 months and performance conditions as defined by the Compensation Committee. The Company assesses the likelihood of achievement throughout the performance period and recognizes compensation expense associated with its performance awards based on this assessment. Other terms and conditions applicable to any award of restricted stock will be determined by the Compensation Committee and set forth in the agreement relating to that award. During 2015 and 2014, the Company issued 34,000 and 170,000 restricted stock awards, respectively, at a per share price of $0.02. Included within the equity grants of 2014 were approximately 109,000 performance based restricted stock awards which vest upon the achievement of business unit and consolidated financial goals relative to fiscal years 2014 through 2016. These equity awards are forfeited if the performance conditions are not achieved for each fiscal year. For the periods ended December 31, 2015 and 2014, the Company recognized compensation expense related to the performance awards based on its estimate of the probability of achievement in accordance with ASC Topic 718. The fair value of restricted stock awards is based on the average price of the Company’s common stock on the date of grant. The weighted average grant date fair value of restricted stock awards granted during the years 2015 and 2014 was $4.67 and $5.24, respectively. In accordance with the terms of the restricted stock award agreements, the Company released 110,000 and 112,000 shares during 2015 and 2014, respectively. During 2015, there were 112,000 shares of restricted stock cancelled, of which 102,000 were performance based restricted shares. During 2014, there were 62,000 shares of restricted stock cancelled, of which 52,000 were performance based restricted shares. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes [Abstract] | |
Income Taxes | Note 9— Income Taxes The provision for income taxes from continuing operations consists of: Year ended December 31, (in thousands) 2015 2014 Current income tax: Federal $ 221 $ 115 State 141 212 Foreign 267 757 629 1,084 Deferred income tax: Federal 816 2,238 State 55 372 871 2,610 Provision for income taxes $ 1,500 $ 3,694 The deferred tax benefit related to discontinued operations was $3.3 million in fiscal year 2015 and $2.1 million recorded in fiscal year 2014. Deferred tax liabilities (assets) are comprised of the following at: December 31, (in thousands) 2015 2014 Deferred tax liabilities: Software development costs $ 1,841 $ 4,984 Acquired intangible assets 2,088 2,350 Gross deferred tax liabilities 3,929 7,334 Allowances for bad debts and inventory (4,804 ) (4,524 ) Capitalized inventory costs (75 ) (114 ) Intangible assets (1,747 ) (2,100 ) Employee benefit accruals (2,050 ) (1,715 ) Federal net operating loss carryforward (6,215 ) (9,249 ) State net operating loss carryforward (1,111 ) (1,104 ) Tax credit carryforwards (8,760 ) (7,809 ) Foreign currency (33 ) (33 ) Other (334 ) (502 ) Gross deferred tax assets (25,129 ) (27,150 ) Less valuation allowance 3,421 3,947 Net deferred tax assets $ (17,779 ) $ (15,869 ) The Company has Federal tax credit carryforwards of $8.7 million that expire in various tax years from 2016 to 2035. The Company has a Federal operating loss carryforward of $19.9 million that expires in various tax years through 2035. Of the operating loss carryforward, $1.6 million will result in a benefit within additional paid in capital when realized. The Company also has state tax credit carryforwards of $210,000 and state net operating loss carryforwards of $8.0 million that expire in various tax years through 2034. In assessing the ability to realize deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which the temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. As a result of this analysis and based on the current year’s taxable income, and utilization of certain carryforwards management determined that it should reduce it valuation allowance in the current year. A valuation allowance is still required to the extent it is more likely than not that the future benefit associated with the foreign tax credit carryforwards and certain state tax loss carryforwards will not be realized. As a result, the Company recorded a tax benefit associated with a reduction of the deferred tax asset valuation allowance of $0.5 million for 2015. The Company recorded tax expense in 2015 associated with an increase in the valuation allowance in 2014 in the amount of $1.6 million for 2014. The Company records the benefits relating to uncertain tax positions only when it is more likely than not (likelihood of greater than 50%), based on technical merits, that the position would be sustained upon examination by taxing authorities. Tax positions that meet the more likely than not threshold are measured using a probability-weighted approach as the largest amount of tax benefit that is greater than 50% likely of being realized upon settlement. At December 31, 2015, the Company’s reserve for uncertain tax positions is not material and the Company believes it has adequately provided for its tax-related liabilities. The Company is no longer subject to United States federal income tax examinations for years before 2012. The provision for (benefit from) income taxes differed from the provision computed by applying the Federal statutory rate to income (loss) from continuing operations before taxes due to the following: 2015 2014 Federal statutory tax rate 34.0 % 34.0 % State taxes 5.8 11.5 Non deductible expenses 1.0 4.6 Tax credits (4.8 ) (11.7 ) Repatriation of foreign earnings 0.0 59.8 Foreign income tax rate differential (1.3 ) (43.2 ) Valuation allowance (9.5 ) 41.7 Tax return and audit adjustments 3.8 0.0 Other (1.8 ) 1.4 27.2 % 98.1 % |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2015 | |
Employee Benefit Plans [Abstract] | |
Employee Benefit Plans | Note 10 — Employee Benefit Plans The Company has a deferred profit-sharing retirement plan that covers substantially all employees. The Company’s annual contribution to the plan is discretionary. The Company’s did not make a contribution in 2015 or 2014. The plan also contains a 401(k) provision that allows employees to contribute a percentage of their salary up to the statutory limitation. These contributions are matched at the rate of 10% by the Company. The Company’s matching contributions under the 401(k) component were $359,000 and $318,000 in 2015 and 2014, respectively. The Company also maintains an incentive-compensation plan. Participants in the plan are key employees as determined by the Board of Directors and executive management. Compensation under the plan is based on the achievement of predetermined financial performance goals of the Company and its subsidiaries. Awards under the plan are payable in cash. Awards under the plan totaled $776,000 and $656,000, in 2015 and 2014, respectively. The Company also sponsors a deferred compensation plan for a select group of highly compensated employees. Participants may make elective deferrals of their salary to the plan in excess of tax code limitations that apply to the Company’s qualified plan. The Company invests the participants’ deferred amounts to fund these obligations. The Company also has the sole discretion to make employer contributions to the plan on behalf of the participants, though it did not make any employer contributions in 2015 or 2014. |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Contingencies [Abstract] | |
Contingencies | Note 11 — Contingencies The Company is subject to legal proceedings, which arise in the ordinary course of business. Additionally, U.S. Government contract costs are subject to periodic audit and adjustment. In the opinion of management, the ultimate liability, if any, with respect to these actions will not materially affect the financial position, results of operations, or cash flows of the Company. |
Segment and Related Information
Segment and Related Information | 12 Months Ended |
Dec. 31, 2015 | |
Segment and Related Information [Abstract] | |
Segment and Related Information | Note 12 — Segment and Related Information The Company is organized in three reporting units: restaurant/retail, hotel/spa, and government. The Company has identified government as a separate reportable segment and has aggregated its two restaurant/retail/hotel/spa reporting units into one reportable segment, hospitality, as the reporting units share many similar economical characteristics. Management views the government and hospitality segments separately in operating its business, as the products and services are different for each segment. The Company’s chief operating decision maker is the Company’s Chief Executive Officer. The hotel/spa reporting has been sold as of November 4, 2015 and is included within discontinued operations (see note 3). The Company has two reportable business segments, hospitality and government. The hospitality segment offers integrated solutions to the hospitality industry consisting of restaurants , Information noted as “Other” primarily relates to the Company’s corporate, home office operations. Information as to the Company’s segments is set forth below. Amounts below exclude discontinued operations. Year ended December 31, (in thousands) 2015 2014 Revenues: Hospitality $ 141,151 $ 130,174 Government 87,852 87,689 Total $ 229,003 $ 217,863 Operating income (loss) : Hospitality $ 1,721 $ 323 Government 5,365 4,883 Other (457 ) (1,790 ) 6,629 3,416 Other income, net (800 ) 485 Interest expense (308 ) (136 ) Income from continuing operations before provision for income taxes $ 5,521 $ 3,765 Identifiable assets: Hospitality $ 72,948 $ 81,269 Government 10,052 11,221 Other 32,312 22,688 Total $ 115,312 $ 115,178 Goodwill: Hospitality $ 10,315 $ 10,315 Government 736 736 Total $ 11,051 $ 11,051 Depreciation, amortization and accretion: Hospitality $ 2,673 $ 1,678 Government 48 50 Other 349 279 Total $ 3,070 $ 2,007 Capital expenditures including software costs: Hospitality $ 3,645 $ 2,181 Government - 36 Other 208 969 Total $ 3,853 $ 3,186 The following table presents revenues by country based on the location of the use of the product or services. Amounts below exclude discontinued operations. December 31, 2015 2014 United States $ 197,303 $ 189,845 Other Countries 31,700 28,018 Total $ 229,003 $ 217,863 The following table presents assets by country based on the location of the asset. Amounts below exclude discontinued operations. December 31, 2015 2014 United States $ 100,021 $ 93,825 Other Countries 15,291 21,353 Total $ 115,312 $ 115,178 Customers comprising 10% or more of the Company's total revenues, excluding discontinued operations, are summarized as follows: December 31, 2015 2014 Hospitality segment McDonald’s Corporation 19 % 16 % Yum! Brands, Inc. 10 % 12 % Government segment U.S. Department of Defense 38 % 40 % All Others 33 % 32 % 100 % 100 % No other customer within All Others represented more than 10% of the Company’s total revenue for the years ended December 31, 2015 and 2014. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value of Financial Instruments [Abstract] | |
Fair Value of Financial Instruments | Note 13 — Fair Value of Financial Instruments The Company’s financial instruments have been recorded at fair value using available market information and valuation techniques. The fair value hierarchy is based upon three levels of input, which are: Level 1 − quoted prices in active markets for identical assets or liabilities (observable) Level 2 − inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in inactive markets, or other inputs that are observable market data for essentially the full term of the asset or liability (observable) Level 3 − unobservable inputs that are supported by little or no market activity, but are significant to determining the fair value of the asset or liability (unobservable) The Company’s financial instruments consist primarily of cash and cash equivalents, trade receivables, trade payables, debt instruments and deferred compensation assets and liabilities. For cash and cash equivalents, trade receivables and trade payables, the carrying amounts of these financial instruments as of December 31, 2015 and 2014 were considered representative of their fair values. The estimated fair value of the Company’s long-term debt and line of credit at December 31, 2015 and 2014 was based on variable and fixed interest rates at December 31, 2015 and 2014, respectively, for new issues with similar remaining maturities and approximates the respective carrying values at December 31, 2015 and 2014. The deferred compensation assets and liabilities primarily relate to the Company’s deferred compensation plan, which allows for pre-tax salary deferrals for certain key employees (see note 10). Changes in the fair value of the deferred compensation liabilities are derived using quoted prices in active markets of the asset selections made by the participants. The deferred compensation liabilities are classified within Level 2, as defined under U.S. GAAP, because their inputs are derived principally from observable market data by correlation to the hypothetical investments. The Company holds insurance investments to partially offset the Company’s liabilities under the deferred compensation plan, which are recorded at fair value each period using the cash surrender value of the insurance investments. The Company has obligations, to be paid in cash, to the former owners of Brink Software, based on the achievement of certain conditions as defined in the definitive agreement (see note 2). The fair value of this contingent consideration payable was estimated using a discounted cash flow method, with significant inputs that are not observable in the market and thus represents a Level 3 fair value measurement as defined in ASC 820, fair value measurements and disclosures. The significant inputs in the Level 3 measurement not supported by market activity included the Company’s probability assessments of expected future cash flows related to the Company’s acquisition of Brink during the contingent consideration period, appropriately discounted considering the uncertainties associated with the obligation, and calculated in accordance with the terms of the definitive agreement. The liabilities for the contingent consideration were established at the time of the acquisition and are evaluated on a quarterly basis based on additional information as it becomes available. Any change in the fair value adjustment is recorded in the earnings of that period. Changes in the fair value of the contingent consideration obligations may result from changes in probability assumptions with respect to the likelihood of achieving the various contingent payment obligations. The following table presents a summary of changes in fair value of the Company’s Level 3 assets and liabilities that are measured at fair value on a recurring basis (in thousands): Level 3 Inputs Liabilities Balance at December 31, 2014 $ 5,040 New level 3 liability - Change in fair value of contingent consideration liability 90 Transfers into or out of Level 3 - Balance at December 31, 2015 $ 5,130 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 14 — Related Party Transactions The Company leases its corporate wellness facility to related parties at a current rate of $9,775 per month. The Company receives a complimentary membership to this facility which is provided to all employees. During 2015 and 2014 the Company received rental income amounting to $117,300 for the lease of the facility in each year. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 15 — Subsequent Events On March 24, 2016, the Company amended its credit facility with J.P. Morgan Chase, N.A. See Note 7 for further details. |
Summary of Significant Accoun24
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Significant Accounting Policies [Abstract] | |
Basis of consolidation | Basis of consolidation The consolidated financial statements include the accounts of PAR Technology Corporation and its subsidiaries (ParTech, Inc., ParTech (Shanghai) Company Ltd., PAR Springer-Miller Systems, Inc., Springer-Miller Canada, ULC, PAR Canada ULC, PAR Government Systems Corporation and Rome Research Corporation, Brink Software, Inc.), collectively referred to as the “Company.” All significant intercompany transactions have been eliminated in consolidation. During the third quarter of fiscal year 2015, the Company performed a strategic analysis of its current product and business unit offerings and as a result, entered into an asset purchase agreement to sell substantially all of the assets of its hotel/spa technology business operated under PAR Springer-Miller Systems, Inc. (“PSMS”) to affiliates of Constellation Software Inc. This transaction closed on November 4, 2015. Accordingly, the results of operations of PSMS have been classified as discontinued operations in accordance with Accounting Standards Codification (“ASC”) 205-20, Presentation of Financial Statements – Discontinued Operations. All prior period amounts have been reclassified to conform to the current period presentation. Refer to Note 3 “Discontinued Operations” in the Notes to the Consolidated Financial Statements for further discussion. |
Business Combinations | Business combinations The Company accounts for business combinations pursuant ASC 805, Business Combinations, which requires that assets acquired and liabilities assumed be recorded at their respective fair values on the date of acquisition. The fair value of the consideration paid is assigned to the underlying net assets of the acquired business based on their respective fair values. Any excess of the purchase price over the estimated fair values of the net assets acquired is allocated to goodwill (the “Acquisition Method”). The purchase price allocation process requires the Company to make significant assumptions and estimates in determining the purchase price and the assets acquired and liabilities assumed at the acquisition date. The Company’s assumptions and estimates are subject to refinement and, as a result, during the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon conclusion of the measurement period, any subsequent adjustments are recorded to the Company’s consolidated statements of operations. The Company’s consolidated financial statements and results of operations reflect an acquired business after the completion of the acquisition. |
Contingent Consideration | Contingent Consideration The Company determines the acquisition date fair value of contingent consideration ASC Topic 820, Fair Value Measurement. Changes in the fair value of the contingent consideration obligations may result from changes in probability assumptions with respect to the likelihood of achieving the various contingent payment obligations. |
Revenue recognition | Revenue recognition policy Our hospitality segment’s revenues consist of sales of the Company’s standard POS system to the hospitality segment. We derive revenue from the following sources: (1) hardware sales, (2) software license agreements, including perpetual licenses and software as a service, (3) professional services, (4) hosting services and (5) post-contract customer support ("PCS"). We recognize revenue when all four revenue recognition criteria have been met: persuasive evidence of an arrangement exists, we have delivered the product or performed the service, the fee is fixed or determinable and collection is probable. Determining whether and when some of these criteria have been satisfied often involves assumptions and judgments that can have a significant impact on the timing and amount of revenue we report. Hardware Revenue recognition on hardware sales occurs upon delivery to the customer site (or when shipped for systems that are not installed by the Company) when persuasive evidence of an arrangement exists, delivery has occurred, the price is fixed or determinable, and collectability is reasonably assured. Software Revenue recognition on software sales generally occurs upon delivery to the customer, when persuasive evidence of an arrangement exists, the price is fixed or determinable, and collectability is probable. For software sales sold as a perpetual license, typical our Pixel software offering, where the Company is the sole party that has the proprietary knowledge to install the software, revenue is recognized upon installation and when the system is ready to go live. Service Service revenue consists of installation and training services, field and depot repair, subscription software products, associated software maintenance, and software related hosted services. Installation and training service revenue are based upon standard hourly/daily rates as well as contracted prices with the customer, and revenue is recognized as the services are performed. Support maintenance and field and depot repair are provided to customers either on a time and materials basis or under a maintenance contract. Services provided on a time and materials basis are recognized as the services are performed. Service revenues from maintenance contracts are recorded as deferred revenue when billed to the customer and are recognized ratably over the underlying contract period. Software sold as a service with our Brink and SureCheck software offerings, is recognized based on the contracted price over its contract term. PAR frequently enters into multiple-element arrangements with its customers including hardware, software, professional consulting services and maintenance support services. For arrangements involving multiple deliverables, when deliverables include software and non-software products and services, PAR evaluates and separates each deliverable to determine whether it represents a separate unit of accounting based on the following criteria: (a) the delivered item has value to the customer on a stand-alone basis; and (b) if the contract includes a general right of return relative to the delivered item, delivery or performance of the undelivered items is considered probable and substantially in the control of PAR. Multiple element arrangements which include hardware, service, and software offerings are separated based upon the stand alone price for each individual hardware, service, or software sold in the arrangement irrespective of the combination of products and services which are included in a particular arrangement. As such, overall consideration is allocated to each unit of accounting based on the unit's relative selling prices. In such circumstances, the Company uses a hierarchy to determine the selling price to be used for allocating revenue to each deliverable: (i) vendor-specific objective evidence of selling price (VSOE), (ii) third-party evidence of selling price (TPE), and (iii) best estimate of selling price (BESP). VSOE generally exists only when the Company sells the deliverable separately and is the price actually charged by the Company for that deliverable. The Company uses BESP to allocate revenue when we are unable to establish VSOE or TPE of selling price. BESP is primarily used for elements such as products that are not consistently priced within a narrow range. The Company determines BESP for a deliverable by considering multiple factors including product and customer class, geography, average discount, and management's historical pricing practices. Amounts allocated to the delivered hardware and software elements are recognized at the time of sale provided the other conditions for revenue recognition have been met. Amounts allocated to the undelivered maintenance and other services elements are recognized as the services are provided or on a straight-line basis over the service period. In certain instances, customer acceptance is required prior to the passage of title and risk of loss of the delivered products. In such cases, revenue is not recognized until the customer acceptance is obtained. Delivery and acceptance generally occur in the same reporting period. In situations where PAR’s solutions contain software related services (generally PCS and professional services), revenue is recognized in accordance with authoritative guidance on software revenue recognition. For the software and software-related elements of such transactions, revenue is allocated based on the relative fair value of each element, and fair value is determined by vender specific objective evidence (VSOE), where available. If VSOE is not available for all elements, we will use the residual method to separate the elements as long as we have VSOE for the undelivered elements. If the Company cannot objectively determine the fair value of any undelivered element included in such multiple-element arrangements, the Company defers the revenue until all elements are delivered and services have been performed, or until fair value can objectively be determined for any remaining undelivered elements. Government Contracts The Company’s contract revenues generated by the Government segment result primarily from contract services performed for the U.S. Government under a variety of cost-plus fixed fee, time-and-material, and fixed-price contracts. Revenue on cost-plus fixed fee contracts is recognized based on allowable costs for labor hours delivered, as well as other allowable costs plus the applicable fee. Revenue on time and material contracts is recognized by multiplying the number of direct labor hours delivered in the performance of the contract by the contract billing rates and adding other direct costs as incurred. Revenue from fixed-price contracts is recognized as labor hours are delivered which approximates the straight-line basis of the life of the contract. The Company’s obligation under these contracts is to provide labor hours to conduct research or to staff facilities with no other deliverables or performance obligations. Anticipated losses on all contracts are recorded in full when identified. Unbilled accounts receivable are stated in the Company’s consolidated financial statements at their estimated realizable value. Contract costs, including indirect expenses, are subject to audit and adjustment through negotiations between the Company and U.S. Government representatives. |
Warranty Provision | Warranty Provisions Warranty provisions for product warranties are recorded in the period in which PAR becomes obligated to honor the related right, which generally is the period in which the related product revenue is recognized. The Company accrues warranty reserves based upon historical factors such as labor rates, average repair time, travel time, number of service calls per machine and cost of replacement parts. When a sale is consummated, a warranty reserve is recorded based upon the estimated cost to provide the service over the warranty period. |
Cash and cash equivalents | Cash and cash equivalents The Company considers all highly liquid investments, purchased with a remaining maturity of three months or less, to be cash equivalents. |
Accounts receivable - Allowance for doubtful accounts | Accounts receivable – Allowance for doubtful accounts Allowances for doubtful accounts are based on estimates of probable losses related to accounts receivable balances. The establishment of allowances requires the use of judgment and assumptions regarding probable losses on receivable balances. The Company continuously monitors collections and payments from our customers and maintain a provision for estimated credit losses based on our historical experience and any specific customer collection issues that we have identified. Thus, if the financial condition of our customers were to deteriorate, our actual losses may exceed our estimates, and additional allowances would be required. |
Inventories | Inventories The Company’s inventories are valued at the lower of cost or market, with cost determined using the first-in, first-out (“FIFO”) method. The Company uses certain estimates and judgments and considers several factors including product demand, changes in customer requirements and changes in technology to provide for excess and obsolescence reserves to properly value inventory. |
Property, plant and equipment | Property, plant and equipment Property, plant and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the assets, which range from three to twenty-five years. Expenditures for maintenance and repairs are expensed as incurred. |
Other assets | Other assets Other assets primarily consist of cash surrender value of life insurance related to the Company’s Deferred Compensation Plan eligible to certain employees. The funded balance is reviewed on an annual basis. |
Income taxes | Income taxes The provision for income taxes is based upon pretax earnings with deferred income taxes provided for the temporary differences between the financial reporting basis and the tax basis of the Company’s assets and liabilities. The Company records a valuation allowance when necessary to reduce deferred tax assets to their net realizable amounts. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. |
Other long-term liabilities | Other long-term liabilities Other long-term liabilities represent amounts owed to certain employees who are participants in the Company’s Deferred Compensation Plan and the estimated fair value of the contingent consideration payable related to the Brink Software Inc. acquisition. |
Foreign currency | Foreign currency The assets and liabilities for the Company’s international operations are translated into U.S. dollars using year-end exchange rates. Income statement items are translated at average exchange rates prevailing during the year. The resulting translation adjustments are recorded as a separate component of shareholders’ equity under the heading Accumulated Other Comprehensive Loss. Exchange gains and losses on intercompany balances of permanently invested long-term loans are also recorded as a translation adjustment and are included in Accumulated Other Comprehensive Loss. Foreign currency transaction gains and losses are recorded in other income in the accompanying statements of operations. |
Other (expense) income | Other (expense) income The components of other (expense) income from continuing operations for the two years ending December 31 are as follows: Year ended December 31 (in thousands) 2015 2014 Foreign currency loss $ (193 ) $ (115 ) Rental income-net 264 359 Investment write-off (776 ) - Other (95 ) 241 $ (800 ) $ 485 The investment write-off of $776,000 in fiscal year 2015 represents the write-off of unauthorized investments that were made in contravention of the Company’s policies and procedures involving the Company’s funds. The unauthorized investments occurred during the period between September 25, 2015 and November 6, 2015. As of December 31, 2015, the Company is uncertain of the collectability of funds relating to these investments and as a result, reduced its fair value to zero. The write-off of the investment resulted in the Company identifying a material weakness over financial reporting as described in Item 9A. |
Identifiable intangible assets | Identifiable intangible assets The Company’s identifiable intangible assets represent intangible assets acquired from the Brink Software Inc. acquisition as well as internally developed software costs. The Company capitalizes certain costs related to the development of computer software sold by its hospitality segment. Software development costs incurred prior to establishing technological feasibility are charged to operations and included in research and development costs. Software development costs incurred after establishing feasibility (as defined within ASC 985-20 for software cost related to sold as a perpetual license and ASC-350-40 for software sold as a service) are capitalized and amortized on a product-by-product basis when the product is available for general release to customers. Software costs capitalized within continuing operations during the periods ended December 31, 2015 and 2014 were $2.1 million and $1.7 million, respectively. Annual amortization, charged to cost of sales when the product is available for general release to customers, is computed using the greater of (a) the straight-line method over the remaining estimated economic life of the product, generally three to seven years or (b) the ratio that current gross revenues for a product bear to the total of current and anticipated future gross revenues for that product. Amortization of capitalized software costs from continuing operations amounted to $843,000 and $673,000, in 2015 and 2014, respectively. The Company assessed its recoverability of capitalized software assets noting no impairments were recorded in 2015 or 2014. In 2014, the Company acquired identifiable intangible assets in connection with its acquisition of Brink Software Inc. Amortization of intangible assets acquired from the Brink Software Inc. acquisition amounted to $987,000 and $279,000 in 2015 and 2014, respectively. The components of identifiable intangible assets, excluding discontinued operations, are: December 31, (in thousands) 2015 2014 Estimated Useful Life Acquired and internally developed software costs $ 12,725 $ 10,577 3 - 7 years Customer relationships 160 160 7 years Non-competition agreements 30 30 1 year 12,915 10,767 Less accumulated amortization (2,417 ) (587 ) $ 10,498 $ 10,180 Trademarks, trade names (non-amortizable) 400 400 N/A $ 10,898 $ 10,580 The expected future amortization of these intangible assets assuming straight-line amortization of capitalized software costs and acquisition related intangibles is as follows (in thousands): 2016 $ 2,012 2017 1,911 2018 1,747 2019 1,350 2020 1,174 Thereafter 2,304 Total $ 10,498 The Company has elected to test for impairment of indefinite lived intangible assets during the fourth quarter of its fiscal year. To value the indefinite lived intangible assets, the Company utilizes the royalty method to estimate the fair values of the trademarks and trade names. As a result of the testing, there was no related impairment charge recorded for the periods ended December 31, 2015 and 2014. |
Stock-based compensation | Stock-based compensation The Company recognizes all stock-based compensation to employees, including grants of employee stock options and restricted stock awards, in the financial statements as compensation cost over the vesting period using an accelerated expense recognition method, based on their fair value on the date of grant. |
Earnings per share | Earnings per share Basic earnings per share are computed based on the weighted average number of common shares outstanding during the period. Diluted earnings per share reflect the dilutive impact of outstanding stock options and restricted stock awards. The following is a reconciliation of the weighted average shares outstanding for the basic and diluted earnings per share computations (in thousands, except share and per share data): December 31, 2015 2014 Income from continuing operations $ 4,021 $ 71 Basic: Shares outstanding at beginning of year 15,592 15,473 Weighted average shares (cancelled) issued during the year, net (30 ) 28 Weighted average common shares, basic 15,562 15,501 Income from continuing operations per common share, basic $ 0.26 $ 0.00 Diluted: Weighted average common shares, basic 15,562 15,501 Dilutive impact of stock options and restricted stock awards 104 81 Weighted average common shares, diluted 15,666 15,582 Income from continuing operations per common share, diluted $ 0.26 $ 0.00 At December 31, 2015 and 2014 there were 112,000 and 215,000 incremental shares, respectively, from the assumed exercise of stock options that were excluded from the computation of diluted earnings per share because of the anti-dilutive effect on earnings per share. There were no restricted stock awards excluded from the computation of diluted earnings per share for each of the fiscal years ended December 31, 2015 and 2014. |
Goodwill | Goodwill The Company tests goodwill for impairment on an annual basis, which is on the first day of the fourth quarter, or more often if events or circumstances indicate there may be impairment. The Company operates in two reportable segments, referred to as business segments, Hospitality and Government. Goodwill impairment testing is performed at the sub-segment level (referred to as a reporting unit). The two reporting units utilized by the Company are: Restaurant and Government. The Hotel/Resort/Spa reporting unit was sold on November 4, 2015 and included within discontinued operations. Goodwill is assigned to reporting units at the date the goodwill is initially recorded. Once goodwill has been assigned to reporting units, it no longer retains its association with a particular acquisition, and all of the activities within a reporting unit, whether acquired or organically grown, are available to support the value of the goodwill. The amount outstanding for goodwill within continuing operations was $11.1 million at December 31, 2015 and 2014. During fiscal 2015, the decrease was a result of the divestiture of the hotel/resort/spa reporting unit. As a result of the fair value received for the Hotel/Resort/Spa divestiture, the Company recorded an impairment charge within discontinued operations of $2.4 million. During fiscal 2014, the increase was a result of $10.3 million of goodwill recorded by the Restaurant reporting unit from the acquisition of Brink Software Inc. There was no The changes and carrying amounts of goodwill by reporting unit were as follows (in thousands): Restaurants Hotel/Resort/ Spa Government Total Net Balances at December 31, 2013 $ - $ 6,116 $ 736 $ 6,852 Goodwill 12,433 13,946 736 27,115 Accumulated Impairment charge (12,433 (7,830 ) - (20,263 ) Acquisition 10,315 - - 10,315 Reclassified to Discontinued Operations - (6,116 ) - (6,116 ) Net balance at December 31, 2014 10,315 - 736 11,051 Goodwill 22,748 13,946 736 37,430 Accumulated Impairment charge (12,433 (10,238 ) - (22,671 ) Divestiture - (3,708 ) - (3,708 ) Net balance at December 31, 2015 $ 10,315 $ - $ 736 $ 11,051 |
Impairment of long-lived assets | Impairment of long-lived assets The Company evaluates the accounting and reporting for the impairment of long-lived assets in accordance with the reporting requirements of ASC 360-10, Accounting for the Impairment or Disposal of Long-Lived Assets. The Company will recognize impairment of long-lived assets or asset groups if the net book value of such assets exceeds the estimated future undiscounted cash flows attributable to such assets. If the carrying value of a long-lived asset or asset group is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds the fair market value of the long-lived asset or asset group for assets to be held and used, or the amount by which the carrying value exceeds the fair market value less cost to sell for assets to be sold. No impairment was identified during 2015 or 2014. |
Reclassifications | Reclassifications Amounts in prior years’ consolidated financial statements are reclassified whenever necessary to conform to the current year’s presentation. The results of operations of PSMS have been classified as discontinued operations in accordance with Accounting Standards Codification (“ASC”) 205-20, Presentation of Financial Statements – Discontinued Operations. All prior period amounts have been reclassified to conform to the current period presentation. Refer to Note 3 “Discontinued Operations” in the Notes to the Consolidated Financial Statements for further discussion. |
Use of estimates | Use of estimates The preparation of the consolidated financial statements requires management of the Company to make a number of estimates and assumptions relating to the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Significant items subject to such estimates and assumptions include revenue recognition, stock based compensation, the recognition and measurement of assets acquired and liabilities assumed in business combinations at fair value, the carrying amount of property, plant and equipment, identifiable intangible assets and goodwill, valuation allowances for receivables, inventories and deferred income tax assets, and measurement of contingent consideration at fair value. Actual results could differ from those estimates. |
Recently issued accounting pronouncements not yet adopted | Recently Issued Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued new guidance related to leases. This standard requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. The new standard is effective for the Company for the fiscal years beginning after December 15, 2018, with early adoption permitted. The Company is evaluating the impact the adoption of this standard will have on its consolidated financial statements. In November 2015, the FASB issued new guidance related to the balance sheet classification of deferred taxes. This standard requires an entity to classify all deferred tax assets, along with any valuation allowance, as noncurrent on the balance sheet. As a result, each jurisdiction will have one net noncurrent deferred tax asset or liability. The new standard is effective for the Company for fiscal years beginning after December 15, 2016. The adoption of this standard, which may be applied either prospectively or retrospectively, is not expected to have a material impact on the Company’s consolidated financial statements. In July 2015, the FASB issued new guidance related to the measurement of inventory. This standard changes the inventory valuation method from the lower of cost or market to the lower of cost or net realizable value for inventory valued under the first-in, first-out or average cost methods. The new standard is effective for the Company beginning in its first quarter of fiscal 2017, and requires prospective adoption with early adoption permitted. The Company is evaluating the impact the adoption of this standard will have on its consolidated financial statements. In April 2015, the FASB issued new guidance related to the presentation of debt issuance costs, which amends existing guidance to require the presentation of debt issuance costs in the balance sheet as a deduction from the carrying amount of the related debt liability, consistent with debt discounts, instead of a deferred charge asset. The new standard is effective for the Company beginning in its first quarter of fiscal 2016, with early adoption permitted. The Company is evaluating the impact the adoption of this standard and it is not expected to have a material impact on our consolidated financial statements. In April 2015, the FASB issued new guidance related to accounting for the fees paid in a cloud computing arrangement, which provides guidance to customers about whether a cloud computing arrangement includes a software license. If considered a software license, the arrangement should be accounted for as an acquisition of a software license. If not considered a software license, the arrangement should be accounted for as a service contract. The new standard is effective for the Company beginning in its first quarter of fiscal 2016, with early adoption permitted. The Company is evaluating the impact the adoption of this standard and it is not expected to have a material impact on our consolidated financial statements In September 2014, the FASB issued amended guidance on the accounting for certain share-based employee compensation awards. The amended guidance requires that share-based employee compensation awards with terms of a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award and compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved. The Company is required to adopt this guidance for its annual and interim periods beginning March 1, 2016. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. In August 2014, the FASB issued new guidance related to disclosures around going concern, including management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related disclosures when conditions or events raise substantial doubt about an entity's ability to continue as a going concern. The new standard is effective for the Company beginning in its first quarter of fiscal 2017, with early adoption permitted. The impact of adopting this guidance on January 1, 2017 is not expected to have a material impact on our consolidated financial statements. In May 2014, the FASB amended the existing accounting standards for revenue recognition. The amendments are based on the principle that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance provides a five-step analysis of transactions to determine when and how revenue is recognized. The guidance also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. In July 2015, the FASB affirmed its proposal of a one-year deferral of the effective date of the new revenue standard. As a result, the new guidance will be effective for the Company beginning in its first quarter of fiscal 2018. The amendments may be applied retrospectively to each prior period presented or with the cumulative effect recognized as of the date of initial application. PAR is currently evaluating the impact of these amendments and the transition alternatives on PAR's financial statements. |
Recently adopted accounting pronouncements | Recently Adopted Accounting Pronouncements In April 2014, the FASB issued guidance that raises the threshold for a disposal to qualify as a discontinued operation and requires new disclosures of both discontinued operations and other disposals that do not meet the definition of a discontinued operations. The new guidance defines a discontinued operation as a disposal of a component or group of components that is disposed of or is classified as held for sale and represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results. The new guidance is effective on January 1, 2015, with early adoption permitted. The adoption of this amendment on January 1, 2015 did not have a significant impact on the Company's financial position or results of operations. |
Summary of Significant Accoun25
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Significant Accounting Policies [Abstract] | |
Components of other income | The components of other (expense) income from continuing operations for the two years ending December 31 are as follows: Year ended December 31 (in thousands) 2015 2014 Foreign currency loss $ (193 ) $ (115 ) Rental income-net 264 359 Investment write-off (776 ) - Other (95 ) 241 $ (800 ) $ 485 |
Components of identifiable intangible assets | The components of identifiable intangible assets, excluding discontinued operations, are: December 31, (in thousands) 2015 2014 Estimated Useful Life Acquired and internally developed software costs $ 12,725 $ 10,577 3 - 7 years Customer relationships 160 160 7 years Non-competition agreements 30 30 1 year 12,915 10,767 Less accumulated amortization (2,417 ) (587 ) $ 10,498 $ 10,180 Trademarks, trade names (non-amortizable) 400 400 N/A $ 10,898 $ 10,580 |
Future amortization of intangible assets | The expected future amortization of these intangible assets assuming straight-line amortization of capitalized software costs and acquisition related intangibles is as follows (in thousands): 2016 $ 2,012 2017 1,911 2018 1,747 2019 1,350 2020 1,174 Thereafter 2,304 Total $ 10,498 |
Reconciliation of weighted average shares outstanding for the basic and diluted earnings per share | The following is a reconciliation of the weighted average shares outstanding for the basic and diluted earnings per share computations (in thousands, except share and per share data): December 31, 2015 2014 Income from continuing operations $ 4,021 $ 71 Basic: Shares outstanding at beginning of year 15,592 15,473 Weighted average shares (cancelled) issued during the year, net (30 ) 28 Weighted average common shares, basic 15,562 15,501 Income from continuing operations per common share, basic $ 0.26 $ 0.00 Diluted: Weighted average common shares, basic 15,562 15,501 Dilutive impact of stock options and restricted stock awards 104 81 Weighted average common shares, diluted 15,666 15,582 Income from continuing operations per common share, diluted $ 0.26 $ 0.00 |
Schedule of Goodwill | The changes and carrying amounts of goodwill by reporting unit were as follows (in thousands): Restaurants Hotel/Resort/ Spa Government Total Net Balances at December 31, 2013 $ - $ 6,116 $ 736 $ 6,852 Goodwill 12,433 13,946 736 27,115 Accumulated Impairment charge (12,433 (7,830 ) - (20,263 ) Acquisition 10,315 - - 10,315 Reclassified to Discontinued Operations - (6,116 ) - (6,116 ) Net balance at December 31, 2014 10,315 - 736 11,051 Goodwill 22,748 13,946 736 37,430 Accumulated Impairment charge (12,433 (10,238 ) - (22,671 ) Divestiture - (3,708 ) - (3,708 ) Net balance at December 31, 2015 $ 10,315 $ - $ 736 $ 11,051 |
Acquisition (Tables)
Acquisition (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Acquisition [Abstract] | |
Summarized of purchase price allocation | The total purchase price was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed by the Company based on their fair values as of the closing date of the acquisition. The excess of the purchase price over those fair values was recorded to goodwill. The following table summarizes our allocation of purchase price (in thousands) at the measurement date, September 18, 2014: Accounts receivable $ 83 Inventories 116 Intangible assets 7,190 Goodwill 10,315 Other assets 90 Total assets acquired $ 17,794 Accounts payable $ 124 Other current liabilites 365 Deferred Tax Liabilities 2,445 Total liabilities assumed $ 2,934 Purchase price $ 14,860 |
Identifiable intangible assets acquired and estimated useful lives | The identifiable intangible assets acquired and their estimated useful lives (based on third party valuations) are as follows (in thousands): Fair Value Estimated Trade name $ 400 Indefinite Developed technology 6,600 7 Years Customer relationships 160 7 Years Non-competition agreements 30 1 Year $ 7,190 |
Schedule of unaudited proforma information | On an unaudited proforma basis, assuming the completed acquisition had occurred as of the beginning of the periods presented, the consolidated results from continuing operations of the Company would have been as follows (in thousands, except per share amounts): (Unaudited) Year ended December 31, 2014 Revenues $ 219,328 Net loss $ (559 ) Earnings per share: Basic $ (0.04 ) Diluted $ (0.04 ) |
Divestiture and Discontinued 27
Divestiture and Discontinued Operations (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Divestiture and Discontinued Operations [Abstract] | |
Summarized financial information of discontinued operations | Summarized financial information for the Company’s discontinued operations is as follows (in thousands): December 31, December 31, Assets Cash $ - $ 300 Accounts receivable - net - 1,771 Other current assets - 574 Property, plant and equipment - net - 986 Goodwill - 6,116 Intangible assets - net - 12,372 Assets of discontinued operation $ - $ 22,119 Liabilities Accounts Payable $ - $ 417 Accrued salaries and benefits 441 703 Accrued expenses - 87 Customer Deposits - 1,103 Deferred service revenue - 2,307 Liabilities of discontinued operation $ 441 $ 4,617 Summarized financial information for the Company’s discontinued operations is as follows (in thousands): December 31, 2015 2014 Total revenues $ 14,545 $ 15,746 Loss from discontinued operations before income taxes $ (5,702 ) $ (5,816 ) Loss on disposition (2,408 ) - Benefit from income taxes 3,198 2,094 Loss from discontinued operations, net of taxes $ (4,912 ) $ (3,722 ) |
Accounts Receivable, net (Table
Accounts Receivable, net (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Accounts Receivable, net [Abstract] | |
Accounts receivable | The Company’s net accounts receivable consist of, excluding discontinued operations: December 31, (in thousands) 2015 2014 Government segment: Billed $ 9,400 $ 9,340 Advanced billings (1,266 ) (450 ) 8,134 8,890 Hospitality segment: Accounts receivable - net 21,396 20,784 $ 29,530 $ 29,674 |
Inventories, net (Tables)
Inventories, net (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Inventories, net [Abstract] | |
Components of inventory | Inventories are used in the manufacture and service of hospitality products. The components of inventory, net consist of the following, excluding discontinued operations: December 31, (in thousands) 2015 2014 Finished Goods $ 8,775 $ 13,615 Work in process 402 457 Component parts 5,068 3,748 Service parts 7,254 8,108 $ 21,499 $ 25,928 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Components of property, plant and equipment | The components of property, plant and equipment, excluding discontinued operations, are: December 31, (in thousands) 2015 2014 Land $ 253 $ 253 Building and improvements 5,645 5,645 Rental property 5,330 5,308 Furniture and equipment 11,804 10,160 23,032 21,366 Less accumulated depreciation (17,316 ) (16,218 ) $ 5,716 $ 5,148 |
Future minimum rent payments due to the Company | The Company leases office space under various operating leases. Rental expense from continuing operations on operating leases was approximately $1.4 million and $1.3 million for 2015 and 2014, respectively. Future minimum lease payments under all non-cancelable operating leases are (in thousands): 2016 1,466 2017 1,149 2018 924 2019 860 2020 336 Thereafter 738 $ 5,473 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Debt [Abstract] | |
Company's future principal payments under its term loan and mortgage | The Company’s future principal payments under the stock purchase agreement and its mortgage are as follows (in thousands): 2016 $ 2,103 2017 188 2018 195 2019 183 $ 2,669 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Stock Based Compensation [Abstract] | |
Information with respect to stock options | Information with respect to stock options included within this plan is as follows: No. of Shares (in thousands) Weighted Average Exercise Price Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2014 1,240 $ 5.28 $ 1,264 Options granted 118 4.90 Options exercised (94 ) 5.04 Forfeited and cancelled (211 ) 5.09 Expired (120 ) 6.50 Outstanding at December 31, 2015 933 $ 5.14 $ 1,579 Vested and expected to vest at December 31, 2015 905 $ 5.14 $ 1,532 Total shares exercisable as of December 31, 2015 302 $ 5.14 $ 512 Shares remaining available for grant 1,000 |
Assumptions for fair value of options at the date of the grant | The fair value of options at the date of the grant was estimated using the Black-Scholes model with the following assumptions for the respective period ending December 31: 2015 2014 Expected option life 5.1 years 5.9 years Weighted average risk-free interest rate 1.6 % 1.7 % Weighted average expected volatility 30 % 31 % Expected dividend yield 0 % 0 % |
Share-based compensation by exercise price range | Stock options outstanding at December 31, 2015 are summarized as follows: Range of Exercise Prices Number Outstanding (in thousands) Weighted Average Remaining Life Weighted Average Exercise Price $ 4.31 - $6.47 933 8.10 years $ 5.14 |
Activity with respect to non-vested stock options | Current year activity with respect to the Company’s non-vested restricted stock awards is as follows: Non-vested restricted stock awards (in thousands) Shares Weighted Average grant- date fair value Balance at January 1, 2015 273 $ 4.68 Granted 34 4.67 Vested (110 ) 4.71 Forfeited and cancelled (112 ) 3.95 Balance at December 31, 2015 85 $ 5.13 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes [Abstract] | |
Provision (benefit) for income taxes from continuing operations | The provision for income taxes from continuing operations consists of: Year ended December 31, (in thousands) 2015 2014 Current income tax: Federal $ 221 $ 115 State 141 212 Foreign 267 757 629 1,084 Deferred income tax: Federal 816 2,238 State 55 372 871 2,610 Provision for income taxes $ 1,500 $ 3,694 |
Deferred tax liabilities (assets) | Deferred tax liabilities (assets) are comprised of the following at: December 31, (in thousands) 2015 2014 Deferred tax liabilities: Software development costs $ 1,841 $ 4,984 Acquired intangible assets 2,088 2,350 Gross deferred tax liabilities 3,929 7,334 Allowances for bad debts and inventory (4,804 ) (4,524 ) Capitalized inventory costs (75 ) (114 ) Intangible assets (1,747 ) (2,100 ) Employee benefit accruals (2,050 ) (1,715 ) Federal net operating loss carryforward (6,215 ) (9,249 ) State net operating loss carryforward (1,111 ) (1,104 ) Tax credit carryforwards (8,760 ) (7,809 ) Foreign currency (33 ) (33 ) Other (334 ) (502 ) Gross deferred tax assets (25,129 ) (27,150 ) Less valuation allowance 3,421 3,947 Net deferred tax assets $ (17,779 ) $ (15,869 ) |
Effective income tax rate reconciliation | The provision for (benefit from) income taxes differed from the provision computed by applying the Federal statutory rate to income (loss) from continuing operations before taxes due to the following: 2015 2014 Federal statutory tax rate 34.0 % 34.0 % State taxes 5.8 11.5 Non deductible expenses 1.0 4.6 Tax credits (4.8 ) (11.7 ) Repatriation of foreign earnings 0.0 59.8 Foreign income tax rate differential (1.3 ) (43.2 ) Valuation allowance (9.5 ) 41.7 Tax return and audit adjustments 3.8 0.0 Other (1.8 ) 1.4 27.2 % 98.1 % |
Segment and Related Informati34
Segment and Related Information (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment and Related Information [Abstract] | |
Information of the Company's segments | Information as to the Company’s segments is set forth below. Amounts below exclude discontinued operations. Year ended December 31, (in thousands) 2015 2014 Revenues: Hospitality $ 141,151 $ 130,174 Government 87,852 87,689 Total $ 229,003 $ 217,863 Operating income (loss) : Hospitality $ 1,721 $ 323 Government 5,365 4,883 Other (457 ) (1,790 ) 6,629 3,416 Other income, net (800 ) 485 Interest expense (308 ) (136 ) Income from continuing operations before provision for income taxes $ 5,521 $ 3,765 Identifiable assets: Hospitality $ 72,948 $ 81,269 Government 10,052 11,221 Other 32,312 22,688 Total $ 115,312 $ 115,178 Goodwill: Hospitality $ 10,315 $ 10,315 Government 736 736 Total $ 11,051 $ 11,051 Depreciation, amortization and accretion: Hospitality $ 2,673 $ 1,678 Government 48 50 Other 349 279 Total $ 3,070 $ 2,007 Capital expenditures including software costs: Hospitality $ 3,645 $ 2,181 Government - 36 Other 208 969 Total $ 3,853 $ 3,186 |
Revenue by geographic area | The following table presents revenues by country based on the location of the use of the product or services. Amounts below exclude discontinued operations. December 31, 2015 2014 United States $ 197,303 $ 189,845 Other Countries 31,700 28,018 Total $ 229,003 $ 217,863 |
Identifiable assets by geographic area | The following table presents assets by country based on the location of the asset. Amounts below exclude discontinued operations. December 31, 2015 2014 United States $ 100,021 $ 93,825 Other Countries 15,291 21,353 Total $ 115,312 $ 115,178 |
Revenue by major customers | Customers comprising 10% or more of the Company's total revenues, excluding discontinued operations, are summarized as follows: December 31, 2015 2014 Hospitality segment McDonald’s Corporation 19 % 16 % Yum! Brands, Inc. 10 % 12 % Government segment U.S. Department of Defense 38 % 40 % All Others 33 % 32 % 100 % 100 % |
Fair Value of Financial Instr35
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value of Financial Instruments [Abstract] | |
Summary of changes in fair value of the Companys Level 3 assets and liabilities that are measured at fair value on a recurring basis | The following table presents a summary of changes in fair value of the Company’s Level 3 assets and liabilities that are measured at fair value on a recurring basis (in thousands): Level 3 Inputs Liabilities Balance at December 31, 2014 $ 5,040 New level 3 liability - Change in fair value of contingent consideration liability 90 Transfers into or out of Level 3 - Balance at December 31, 2015 $ 5,130 |
Summary of Significant Accoun36
Summary of Significant Accounting Policies (Details) | 12 Months Ended | |
Dec. 31, 2015USD ($)Segment$ / sharesshares | Dec. 31, 2014USD ($)$ / sharesshares | |
Basis of consolidation [Abstract] | ||
Net loss associated with working capital adjustment on discontinued operations | $ (4,912,000) | $ (3,722,000) |
Maximum maturity period to classify as cash equivalent | 3 months | |
Other income [Abstract] | ||
Foreign currency loss | $ (193,000) | (115,000) |
Rental income-net | 264,000 | 359,000 |
Investment write-off | (776,000) | 0 |
Other | (95,000) | 241,000 |
Total | (800,000) | 485,000 |
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of capitalized software costs | 2,100,000 | 1,700,000 |
Accelerated amortization | 843,000 | 673,000 |
Amortization identifiable intangible assets | 987,000 | 279,000 |
Components of identifiable intangible assets, including capitalized internal software development costs [Abstract] | ||
Intangible assets, gross | 12,915,000 | 10,767,000 |
Less accumulated amortization | (2,417,000) | (587,000) |
Total | 10,498,000 | 10,180,000 |
Indefinite-Lived Intangible Assets (Excluding Goodwill) | 400,000 | 400,000 |
Intangible assets - net | 10,898,000 | 10,580,000 |
Future amortization of intangible assets [Abstract] | ||
2,016 | 2,012,000 | |
2,017 | 1,911,000 | |
2,018 | 1,747,000 | |
2,019 | 1,350,000 | |
2,020 | 1,174,000 | |
Thereafter | 2,304,000 | |
Total | 10,498,000 | 10,180,000 |
Basic and diluted earnings per share computations [Abstract] | ||
Income from continuing operations | $ 4,021,000 | $ 71,000 |
Basic [Abstract] | ||
Shares outstanding at beginning of year (in shares) | shares | 15,592,000 | 15,473,000 |
Weighted average shares (cancelled) issued during the year (in shares) | shares | (30,000) | 28,000 |
Weighted average common shares, basic (in shares) | shares | 15,562,000 | 15,501,000 |
Income from continuing operations per common share, basic (in dollars per share) | $ / shares | $ 0.26 | $ 0 |
Diluted [Abstract] | ||
Weighted average common shares, basic (in shares) | shares | 15,562,000 | 15,501,000 |
Weighted average shares issued during the year (in shares) | shares | 11,000 | 4,000 |
Dilutive impact of stock options and restricted stock awards (in shares) | shares | 93,000 | 77,000 |
Weighted average common shares, diluted (in shares) | shares | 15,666,000 | 15,582,000 |
Income from continuing operations per common share, diluted (in dollars per share) | $ / shares | $ 0.26 | $ 0 |
Goodwill [Abstract] | ||
Number of operating segments | Segment | 2 | |
Number of reportable units | Segment | 2 | |
Goodwill [Line Items] | ||
Goodwill impairment charge | $ 22,671,000 | $ 20,263,000 |
Goodwill [Roll Forward] | ||
Net balances at beginning of period | 11,051,000 | 6,852,000 |
Goodwill | 37,430,000 | 27,115,000 |
Accumulated Impairment charge | (22,671,000) | (20,263,000) |
Acquisition | 10,315,000 | |
Reclassified to Discontinued Operations | (6,116,000) | |
Divestiture | (3,708,000) | |
Net balance at end of period | 11,051,000 | 11,051,000 |
Asset Impairment Charges [Abstract] | ||
Impairment charge | 0 | 0 |
Discontinued Operations [Member] | ||
Goodwill [Line Items] | ||
Goodwill impairment charge | 2,400,000 | 0 |
Goodwill [Roll Forward] | ||
Accumulated Impairment charge | (2,400,000) | 0 |
Acquired and internally developed software costs [Member] | ||
Components of identifiable intangible assets, including capitalized internal software development costs [Abstract] | ||
Intangible assets, gross | 12,725,000 | 10,577,000 |
Customer Relationships [Member] | ||
Components of identifiable intangible assets, including capitalized internal software development costs [Abstract] | ||
Intangible assets, gross | $ 160,000 | 160,000 |
Estimated Useful Life | 7 years | |
Non-competition Agreements [Member] | ||
Components of identifiable intangible assets, including capitalized internal software development costs [Abstract] | ||
Intangible assets, gross | $ 30,000 | 30,000 |
Estimated Useful Life | 1 year | |
Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 3 years | |
Minimum [Member] | Acquired and internally developed software costs [Member] | ||
Components of identifiable intangible assets, including capitalized internal software development costs [Abstract] | ||
Estimated Useful Life | 3 years | |
Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 25 years | |
Maximum [Member] | Acquired and internally developed software costs [Member] | ||
Components of identifiable intangible assets, including capitalized internal software development costs [Abstract] | ||
Estimated Useful Life | 7 years | |
Restaurants [Member] | ||
Goodwill [Line Items] | ||
Goodwill impairment charge | $ 12,433,000 | 12,433,000 |
Goodwill [Roll Forward] | ||
Net balances at beginning of period | 10,315,000 | 0 |
Goodwill | 22,748,000 | 12,433,000 |
Accumulated Impairment charge | (12,433,000) | (12,433,000) |
Acquisition | 10,315,000 | |
Reclassified to Discontinued Operations | 0 | |
Divestiture | 0 | |
Net balance at end of period | 10,315,000 | 10,315,000 |
Hotel/Resort/Spa [Member] | ||
Goodwill [Line Items] | ||
Goodwill impairment charge | 10,238,000 | 7,830,000 |
Goodwill [Roll Forward] | ||
Net balances at beginning of period | 0 | 6,116,000 |
Goodwill | 13,946,000 | 13,946,000 |
Accumulated Impairment charge | (10,238,000) | (7,830,000) |
Acquisition | 0 | |
Reclassified to Discontinued Operations | (6,116,000) | |
Divestiture | (3,708,000) | |
Net balance at end of period | 0 | 0 |
Government Segment [Member] | ||
Goodwill [Line Items] | ||
Goodwill impairment charge | 0 | 0 |
Goodwill [Roll Forward] | ||
Net balances at beginning of period | 736,000 | 736,000 |
Goodwill | 736,000 | 736,000 |
Accumulated Impairment charge | 0 | 0 |
Acquisition | 0 | |
Reclassified to Discontinued Operations | 0 | |
Divestiture | 0 | |
Net balance at end of period | $ 736,000 | $ 736,000 |
Stock Options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Incremental shares excluded from computation of diluted earnings per share (in shares) | shares | 112,000 | 215,000 |
Acquisition (Details)
Acquisition (Details) - USD ($) | Sep. 18, 2014 | Dec. 31, 2015 | Dec. 31, 2014 |
Business Acquisition [Line Items] | |||
Fair value of the long term portion of the note payable | $ 1,900,000 | ||
Amortization of identifiable intangible assets | 987,000 | $ 279,000 | |
Aggregate purchase price | 10,315,000 | ||
Acquisition revenue | 832,000 | ||
Acquisition net loss | 145,000 | ||
Schedule of purchase price allocation [Abstract] | |||
Accounts receivable | 83,000 | ||
Inventories | 116,000 | ||
Intangible assets | 7,190,000 | ||
Goodwill | 10,315,000 | ||
Other assets | 90,000 | ||
Total assets acquired | 17,794,000 | ||
Accounts payable | 124,000 | ||
Other current liabilities | 365,000 | ||
Deferred Tax Liabilities | 2,445,000 | ||
Total liabilities assumed | 2,934,000 | ||
Purchase price | 14,860,000 | ||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Total identifiable intangible assets | 7,190,000 | ||
Business Acquisition, Pro Forma Information [Abstract] | |||
Revenues | 219,328,000 | ||
Net loss | $ (559,000) | ||
Earnings per share: [Abstract] | |||
Basic (in dollars per share) | $ (0.04) | ||
Diluted (in dollars per share) | $ (0.04) | ||
Trade Name [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Indefinite intangible assets | 400,000 | ||
Developed Technology [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets | $ 6,600,000 | ||
Estimated useful life | 7 years | ||
Customer Relationships [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets | $ 160,000 | ||
Estimated useful life | 7 years | ||
Non-competition Agreements [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets | $ 30,000 | ||
Estimated useful life | 1 year | ||
Brink Software Inc. [Member] | |||
Business Acquisition [Line Items] | |||
Payments for the acquisition | $ 10,000,000 | ||
Period of purchase price payable | 3 years | ||
Contingent liability payable, Maximum | $ 7,000,000 | ||
Percentage of equity interest | 100.00% | ||
Amortization of identifiable intangible assets | $ 987,000 | $ 279,000 | |
Contingent purchase agreement escrow provision | 1,000,000 | ||
Aggregate purchase price | $ 14,900,000 | ||
Cash acquired on purchase of business | 184,000 | ||
Net cash paid for purchase of business | 5,000,000 | ||
Additional estimated cash payments | 9,900,000 | ||
Estimated fair value liability for contingent consideration | 5,100,000 | ||
Transaction, integration, and other acquisition related costs | $ 163,000 | ||
Schedule of purchase price allocation [Abstract] | |||
Goodwill | $ 14,900,000 | ||
Brink Software Inc. [Member] | Tranche One [Member] | |||
Business Acquisition [Line Items] | |||
Payments for the acquisition | $ 5,000,000 | ||
Percentage of equity interest | 51.00% | ||
Brink Software Inc. [Member] | Tranche Two [Member] | |||
Business Acquisition [Line Items] | |||
Payments for the acquisition | $ 3,000,000 | ||
Percentage of equity interest | 49.00% | ||
Brink Software Inc. [Member] | Tranche Three [Member] | |||
Business Acquisition [Line Items] | |||
Payments for the acquisition | $ 2,000,000 |
Divestiture and Discontinued 38
Divestiture and Discontinued Operations (Details) - USD ($) | Nov. 04, 2015 | Dec. 31, 2015 | Dec. 31, 2014 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Consideration received | $ 12,100,000 | $ 0 | |
Assets | |||
Cash | 0 | 300,000 | |
Operations | |||
Benefit from income taxes | 3,300,000 | 2,100,000 | |
Loss from discontinued operations, net of taxes | (4,912,000) | (3,722,000) | |
PAR Springer Miller Systems Inc [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Total consideration | $ 16,600,000 | ||
Consideration received | 12,100,000 | ||
Consideration receivable | 4,500,000 | ||
Estimated fair value of the notes receivable | 3,300,000 | ||
Consideration receivable upon achievement of targets | $ 1,500,000 | ||
Assets | |||
Cash | 0 | 300,000 | |
Accounts receivable - net | 0 | 1,771,000 | |
Other current assets | 0 | 574,000 | |
Property, plant and equipment - net | 0 | 986,000 | |
Goodwill | 0 | 6,116,000 | |
Intangible assets - net | 0 | 12,372,000 | |
Assets classified as held for sale | 0 | 22,119,000 | |
Liabilities | |||
Accounts Payable | 0 | 417,000 | |
Accrued salaries and benefits | 441,000 | 703,000 | |
Accrued expenses | 0 | 87,000 | |
Customer Deposits | 0 | 1,103,000 | |
Deferred service revenue | 0 | 2,307,000 | |
Liabilities associated with assets held for sale | 441,000 | 4,617,000 | |
Operations | |||
Total revenues | 14,545,000 | 15,746,000 | |
Loss from discontinued operations before income taxes | (5,702,000) | (5,816,000) | |
Loss on disposition | (2,408,000) | 0 | |
Benefit from income taxes | 3,198,000 | 2,094,000 | |
Loss from discontinued operations, net of taxes | $ (4,912,000) | $ (3,722,000) |
Accounts Receivable, net (Detai
Accounts Receivable, net (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Accounts Receivable [Abstract] | |||
Accounts receivable-net | $ 29,530,000 | $ 29,674,000 | |
Write-offs of accounts receivable | 382,000 | 278,000 | |
Provision for doubtful accounts | 772,000 | 340,000 | |
Government segment [Member] | |||
Accounts Receivable [Abstract] | |||
Accounts receivable-net | 8,134,000 | 8,890,000 | |
Government segment [Member] | Billed [Member] | |||
Accounts Receivable [Abstract] | |||
Accounts receivable-net | 9,400,000 | 9,340,000 | |
Government segment [Member] | Advance billings [Member] | |||
Accounts Receivable [Abstract] | |||
Accounts receivable-net | (1,266,000) | (450,000) | |
Hospitality segment [Member] | |||
Accounts Receivable [Abstract] | |||
Accounts receivable-net | 21,396,000 | 20,784,000 | |
Allowances for doubtful accounts | $ 875,000 | $ 484,000 | $ 422,000 |
Inventories, net (Details)
Inventories, net (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Component of inventory use in hospitality product [Abstract] | ||
Finished Goods | $ 8,775 | $ 13,615 |
Work in process | 402 | 457 |
Component parts | 5,068 | 3,748 |
Service parts | 7,254 | 8,108 |
Inventory net | 21,499 | 25,928 |
Inventory reserves | $ 8,600 | $ 7,900 |
Property, Plant and Equipment41
Property, Plant and Equipment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Components of property, plant and equipment [Abstract] | ||
Property, plant and equipment, Gross | $ 23,032,000 | $ 21,366,000 |
Less accumulated depreciation | (17,316,000) | (16,218,000) |
Property, plant and equipment, Net | 5,716,000 | 5,148,000 |
Depreciation expense recorded | 1,137,000 | 1,052,000 |
Rent received from leases | 264,000 | 359,000 |
Future minimum rent payments due in 2016 | 306,000 | |
Future minimum rent payments due in 2017 | 246,000 | |
Future minimum rent payments due in 2018 | 57,000 | |
Rental expense on operating leases | 1,400,000 | 1,300,000 |
Future minimum lease payments under all non-cancelable operating leases [Abstract] | ||
2,016 | 1,466,000 | |
2,017 | 1,149,000 | |
2,018 | 924,000 | |
2,019 | 860,000 | |
2,020 | 336,000 | |
Thereafter | 738,000 | |
Total | $ 5,473,000 | |
Minimum [Member] | ||
Components of property, plant and equipment [Abstract] | ||
Estimated useful lives | 3 years | |
Maximum [Member] | ||
Components of property, plant and equipment [Abstract] | ||
Estimated useful lives | 25 years | |
Land [Member] | ||
Components of property, plant and equipment [Abstract] | ||
Property, plant and equipment, Gross | $ 253,000 | 253,000 |
Building and improvements [Member] | ||
Components of property, plant and equipment [Abstract] | ||
Property, plant and equipment, Gross | $ 5,645,000 | 5,645,000 |
Building and improvements [Member] | Minimum [Member] | ||
Components of property, plant and equipment [Abstract] | ||
Estimated useful lives | 20 years | |
Building and improvements [Member] | Maximum [Member] | ||
Components of property, plant and equipment [Abstract] | ||
Estimated useful lives | 25 years | |
Rental property [Member] | ||
Components of property, plant and equipment [Abstract] | ||
Property, plant and equipment, Gross | $ 5,330,000 | 5,308,000 |
Rental property [Member] | Minimum [Member] | ||
Components of property, plant and equipment [Abstract] | ||
Estimated useful lives | 20 years | |
Rental property [Member] | Maximum [Member] | ||
Components of property, plant and equipment [Abstract] | ||
Estimated useful lives | 25 years | |
Furniture and equipment [Member] | ||
Components of property, plant and equipment [Abstract] | ||
Property, plant and equipment, Gross | $ 11,804,000 | $ 10,160,000 |
Furniture and equipment [Member] | Minimum [Member] | ||
Components of property, plant and equipment [Abstract] | ||
Estimated useful lives | 3 years | |
Furniture and equipment [Member] | Maximum [Member] | ||
Components of property, plant and equipment [Abstract] | ||
Estimated useful lives | 8 years |
Debt (Details)
Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2015 | Dec. 31, 2014 | Nov. 01, 2014 | Oct. 02, 2014 | Jun. 04, 2014 | |
Debt Instrument [Line Items] | |||||
Borrowing availability | $ 20,000 | ||||
Debt instrument term | 3 years | ||||
Maximum borrowing availability | $ 25,000 | $ 30,000 | |||
Bank's prime lending rate | 3.25% | ||||
Description of variable credit basis | LIBOR | ||||
Weighted average interest rate | 3.50% | ||||
Cash transfers | $ 776 | $ 0 | |||
Mortgage | $ 746,000 | 919,000 | |||
Maturity date | Nov. 1, 2019 | ||||
Fixed interest percentage rate | 4.00% | 4.05% | |||
Period considered for new rate | 5 years | ||||
Debt instrument additional basis points to new rate | 2.25% | ||||
Annual mortgage payment | $ 206,000 | ||||
Future principal payments under the stock purchase agreement and its mortgage: | |||||
2,016 | 2,103 | ||||
2,017 | 188 | ||||
2,018 | 195 | ||||
2,019 | 183 | ||||
Total | 2,669 | ||||
Brinks indebtedness [Member] | |||||
Debt Instrument [Line Items] | |||||
Brinks note payable | 2,000 | 5,000 | |||
Carry value of Brinks indebtedness | $ 1,900 | $ 4,800 | |||
Brinks indebtedness [Member] | Tranche One [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity date | Sep. 18, 2015 | ||||
Debt repayment amounts | $ 3,000 | ||||
Brinks indebtedness [Member] | Tranche Two [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity date | Sep. 18, 2016 | ||||
Debt repayment amounts | $ 2,000 | ||||
LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread rate minimum | 1.50% | ||||
Basis spread rate maximum | 2.00% |
Stock Based Compensation (Detai
Stock Based Compensation (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 487,000 | $ 1,185,000 |
Stock-based compensation expense, tax benefit | $ 197,000 | $ 114,000 |
No. of Shares [Roll Forward] | ||
Outstanding (in shares) | 1,240,000 | |
Options granted (in shares) | 118,000 | |
Exercised (in shares) | (94,000) | |
Forfeited and cancelled (in shares) | (211,000) | |
Expired (in shares) | (120,000) | |
Outstanding (in shares) | 933,000 | 1,240,000 |
Vested and expected to vest (in shares) | 905,000 | |
Total shares exercisable (in shares) | 302,000 | |
Shares remaining available for grant (in shares) | 1,000,000 | |
Weighted Average Exercise Price [Roll Forward] | ||
Outstanding (in dollars per share) | $ 5.28 | |
Options granted (in dollars per share) | 4.90 | |
Exercised (in dollars per share) | 5.04 | |
Forfeited and cancelled (in dollars per share) | 5.09 | |
Expired (in dollars per share) | 6.50 | |
Outstanding (in dollars per share) | 5.14 | $ 5.28 |
Vested and expected to vest (in dollars per share) | 5.14 | |
Total shares exercisable (in dollars per share) | $ 5.14 | |
Aggregate Intrinsic Value [Abstract] | ||
Outstanding | $ 1,264,000 | |
Outstanding | 1,579,000 | $ 1,264,000 |
Vested and expected to vest | 1,532,000 | |
Total shares exercisable | $ 512,000 | |
Weighted average grant date fair value of options granted (in dollars per share) | $ 1.44 | $ 1.68 |
Total intrinsic value of options exercised | $ 119,000 | $ 0 |
Assumptions used for fair value of options at the date of the grant [Abstract] | ||
Expected option life | 5 years 1 month 6 days | 5 years 10 months 24 days |
Weighted average risk-free interest rate | 1.60% | 1.70% |
Weighted average expected volatility | 30.00% | 31.00% |
Expected dividend yield | 0.00% | 0.00% |
Unrecognized compensation expense | $ 758,000 | |
Period for recognition | 2016 through 2018 | |
Weighted average grant date fair value [Roll Forward] | ||
Restricted stock awards granted (in shares) | 34,000 | 170,000 |
Share price (in dollars per share) | $ 0.02 | |
Days prior to grant date considered for fair value of award | 0 days | |
Weighted average grant date fair value (in dollars per share) | $ 4.67 | $ 5.24 |
Shares released (in shares) | 110,000 | 112,000 |
Restricted stock awards cancelled (in shares) | 112,000 | 62,000 |
Restricted Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 182,000 | $ 608,000 |
Restricted Stock [Member] | Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 0 months | |
Restricted Stock [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 60 months | |
Performance Based Restricted Stock [Member] | ||
Weighted average grant date fair value [Roll Forward] | ||
Restricted stock awards granted (in shares) | 109,000 | |
Restricted stock awards cancelled (in shares) | 102,000 | 52,000 |
Performance Based Restricted Stock [Member] | Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 12 months | |
Performance Based Restricted Stock [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 36 months | |
Non-vested Equity Awards [Member] | ||
Activity of nonvested options outstanding [Roll Forward] | ||
Balance (in shares) | 273,000 | |
Granted (in shares) | 34,000 | |
Vested (in shares) | (110,000) | |
Forfeited and cancelled (in shares) | (112,000) | |
Balance (in shares) | 85,000 | 273,000 |
Weighted average grant date fair value [Roll Forward] | ||
Balance (in dollars per share) | $ 4.68 | |
Granted (in dollars per share) | 4.67 | |
Vested (in dollars per share) | 4.71 | |
Forfeited and cancelled (in dollars per share) | 3.95 | |
Balance (in dollars per share) | $ 5.13 | $ 4.68 |
2015 Equity Incentive Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares reserved under plan (in shares) | 1,000,000 | |
Expiration period | 10 years | |
2015 Equity Incentive Plan [Member] | Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 1 year | |
2015 Equity Incentive Plan [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 5 years | |
$4.31 to $6.47 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Lower Range of Exercise Price (in dollars per share) | $ 4.31 | |
Upper Range of Exercise Price (in dollars per share) | $ 6.47 | |
Number Outstanding (in shares) | 933,000 | |
Weighted Average Remaining Life | 8 years 1 month 6 days | |
Weighted Average Exercise Price (in dollars per share) | $ 5.14 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Current income tax [Abstract] | ||
Federal | $ 221,000 | $ 115,000 |
State | 141,000 | 212,000 |
Foreign | 267,000 | 757,000 |
Total | 629,000 | 1,084,000 |
Deferred income tax [Abstract] | ||
Federal | 816,000 | 2,238,000 |
State | 55,000 | 372,000 |
Total | 871,000 | 2,610,000 |
Provision for income taxes | 1,500,000 | 3,694,000 |
Deferred tax benefit related to discontinued operations | 3,300,000 | 2,100,000 |
Deferred tax liabilities (assets) | ||
Software development costs | 1,841,000 | 4,984,000 |
Acquired intangible assets | 2,088,000 | 2,350,000 |
Gross deferred tax liabilities | 3,929,000 | 7,334,000 |
Allowances for bad debts and inventory | (4,804,000) | (4,524,000) |
Capitalized inventory costs | (75,000) | (114,000) |
Intangible assets | (1,747,000) | (2,100,000) |
Employee benefit accruals | (2,050,000) | (1,715,000) |
Federal net operating loss carryforward | (6,215,000) | (9,249,000) |
State net operating loss carryforward | (1,111,000) | (1,104,000) |
Tax credit carryforwards | (8,760,000) | (7,809,000) |
Foreign currency | (33,000) | (33,000) |
Other | (333,000) | (502,000) |
Gross deferred tax assets | (25,128,000) | (27,150,000) |
Less valuation allowance | 3,421,000 | 3,947,000 |
Net deferred tax assets | (17,778,000) | (15,869,000) |
Schedule of Income Tax [Line Items] | ||
Benefit within additional paid in capital on realization of operating loss carryforward | 1,600,000 | |
Tax (benefit) expense associated with deferred tax asset valuation allowance | $ (500,000) | $ 1,600,000 |
Percentage for recognition of uncertain tax positions, minimum | 50.00% | |
Computation of effective income tax rate [Abstract] | ||
Federal statutory tax rate | 34.00% | 34.00% |
State taxes | 5.80% | 11.50% |
Non deductible expenses | 1.00% | 4.60% |
Tax credits | (4.80%) | (11.70%) |
Repatriation of foreign earnings | 0.00% | 59.80% |
Foreign income tax rate differential | (1.30%) | (43.20%) |
Valuation allowance | (9.50%) | 41.70% |
Tax Return and audit adjustments | 3.80% | 0.00% |
Other | (1.80%) | 1.40% |
Total | 27.20% | 98.10% |
State [Member] | ||
Schedule of Income Tax [Line Items] | ||
Tax credit carryforwards | $ 210,000 | |
Operating loss carryforward | 8,000,000 | |
Federal [Member] | ||
Schedule of Income Tax [Line Items] | ||
Tax credit carryforwards | 8,700,000 | |
Operating loss carryforward | $ 19,900,000 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Employee Benefit Plans [Abstract] | ||
Matching contribution percentage | 10.00% | |
Matching contribution | $ 359,000 | $ 318,000 |
Awards payable under incentive-compensation plan | $ 776,000 | $ 656,000 |
Segment and Related Informati46
Segment and Related Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015USD ($)Segmenth | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Segment and Related Information [Abstract] | |||
Number of reportable segments | Segment | 2 | ||
Number of hours of telephone support for hospitality segment (in hours) | h | 24 | ||
Information as to the Company's segments [Abstract] | |||
Revenue, net | $ 229,003 | $ 217,863 | |
Operating income (loss) | 6,629 | 3,416 | |
Other income, net | (800) | 485 | |
Interest expense | (308) | (136) | |
Income from continuing operations before provision for income taxes | 5,521 | 3,765 | |
Identifiable assets | 115,312 | 115,178 | |
Goodwill | 11,051 | 11,051 | $ 6,852 |
Depreciation and amortization | 3,070 | 2,007 | |
Capital expenditures including software costs | 3,853 | 3,186 | |
United States [Member] | Reportable Geographical Components [Member] | |||
Information as to the Company's segments [Abstract] | |||
Revenue, net | 197,303 | 189,845 | |
Identifiable assets | 100,021 | 93,825 | |
Other Countries [Member] | Reportable Geographical Components [Member] | |||
Information as to the Company's segments [Abstract] | |||
Revenue, net | 31,700 | 28,018 | |
Identifiable assets | 15,291 | 21,353 | |
Hospitality [Member] | Reportable Segments [Member] | |||
Information as to the Company's segments [Abstract] | |||
Revenue, net | 141,151 | 130,174 | |
Operating income (loss) | 1,721 | 323 | |
Identifiable assets | 72,948 | 81,269 | |
Goodwill | 10,315 | 10,315 | |
Depreciation and amortization | 2,673 | 1,678 | |
Capital expenditures including software costs | 3,645 | 2,181 | |
Government [Member] | |||
Information as to the Company's segments [Abstract] | |||
Goodwill | 736 | 736 | $ 736 |
Government [Member] | Reportable Segments [Member] | |||
Information as to the Company's segments [Abstract] | |||
Revenue, net | 87,852 | 87,689 | |
Operating income (loss) | 5,365 | 4,883 | |
Identifiable assets | 10,052 | 11,221 | |
Goodwill | 736 | 736 | |
Depreciation and amortization | 48 | 50 | |
Capital expenditures including software costs | 0 | 36 | |
Other [Member] | |||
Information as to the Company's segments [Abstract] | |||
Operating income (loss) | (457) | (1,790) | |
Identifiable assets | 32,312 | 22,688 | |
Depreciation and amortization | 349 | 279 | |
Capital expenditures including software costs | $ 208 | $ 969 |
Segment and Related Informati47
Segment and Related Information, Reconciliation of Segment Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Identifiable assets by business segment [Abstract] | ||
Identifiable assets | $ 115,312 | $ 115,178 |
United States [Member] | Reportable Geographical Components [Member] | ||
Identifiable assets by business segment [Abstract] | ||
Identifiable assets | 100,021 | 93,825 |
Other Countries [Member] | Reportable Geographical Components [Member] | ||
Identifiable assets by business segment [Abstract] | ||
Identifiable assets | $ 15,291 | $ 21,353 |
Segment and Related Informati48
Segment and Related Information, Revenue By Major Customer (Details) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue, Major Customer [Line Items] | ||
Percentage of revenue generated by customer | 100.00% | 100.00% |
Hospitality segment [Member] | McDonald's Corporation [Member] | Reportable Segments [Member] | ||
Revenue, Major Customer [Line Items] | ||
Percentage of revenue generated by customer | 19.00% | 16.00% |
Hospitality segment [Member] | Yum! Brands, Inc. [Member] | Reportable Segments [Member] | ||
Revenue, Major Customer [Line Items] | ||
Percentage of revenue generated by customer | 10.00% | 12.00% |
Government segment [Member] | U.S. Department of Defense [Member] | Reportable Segments [Member] | ||
Revenue, Major Customer [Line Items] | ||
Percentage of revenue generated by customer | 38.00% | 40.00% |
All Others [Member] | ||
Revenue, Major Customer [Line Items] | ||
Percentage of revenue generated by customer | 33.00% | 32.00% |
Fair Value of Financial Instr49
Fair Value of Financial Instruments (Details) - Contingent consideration liability [Member] $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Balance at December 31, 2013 | $ 5,040 |
New level 3 liability | 0 |
Change in fair value of contingent consideration liability | 90 |
Transfers into or out of Level 3 | 0 |
Balance at December 31, 2014 | $ 5,130 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Related Party Transactions [Abstract] | ||
Monthly rental income from related parties | $ 9,775 | |
Rental income received | $ 117,300 | $ 117,300 |