Par Technology's Customers Performance

The Company performs work for U.S. Government agencies under firm fixed-price, cost-plus-fixed-fee, and time-and-material contracts. The majority of these contracts have a period of performance of one to five years. There are several risks associated with government contracting. For instance, contracts may be reduced in size, scope and value, as well as modified, delayed and/or cancelled depending upon the government’s requests, budgets, policies and/or changes in regulations. Contracts can also be terminated for the convenience of the government at any time the government believes that such termination would be in its best interests. In this circumstance, the Company is entitled to receive payments for its allowable costs and, in general, a proportionate share of its fee or profit for the work actually performed. The Company may also perform work prior to formal authorization or prior to adjustment of the contract price for increased work scope, change orders and other funding adjustments. In this situation, the Company is performing the work under our own risk and would be responsible for any costs incurred during this time. Additionally, the defense contract audit agency regularly audits the financial records of the Company. Such audits can result in adjustments to contract costs and fees. Audits have been completed through the Company’s fiscal year 2013 and have not resulted in any material adjustments.

Within the Hospitality Segment, PAR has dedicated sales teams engaging directly with our tier 1 (representing 2,000 sites and above), tier 2 (101-1,999 sites) and tier 3 (2 – 100 sites) customers. The Company also has dedicated channel partner executives who solely support our Brink and Pixel partners to effectively position and sell PAR’s software and hardware solutions to a wide range of customers.

Our strategic account sales organization concentrates on large chain, corporate customers and their franchisees globally. In addition, sales efforts are directed toward franchisees of large chains for which the Company is not necessarily the enterprise POS vendor. The Company’s Brink sales team includes a SMB sales team that focuses on Brink sales to multi-unit operators with 25-350 locations as well as major account sales executives to capture the Tier 1 and Tier 2 Brink target market. The Company’s international direct sales force markets to major global tier 1customers as well as regional international chains in restaurant and retail. With the support from our global partner team, PAR’s channel partners sell and support PAR PixelPoint in the U.S. and around the globe.

The Company’s indirect sales channel sales representatives enlist and support many well-regarded value-added resellers / partners serving the multi-unit operators, independent restaurant sector and non-foodservice markets such as retail, convenience, amusement parks, movie theaters, cruise lines, spas and other ticketing and entertainment venues.

The Company performs work for U.S. Government agencies under firm fixed-price, cost-plus-fixed-fee, and time-and-material contracts. The majority of these contracts have a period of performance of one to five years. There are several risks associated with government contracting. For instance, contracts may be reduced in size, scope and value, as well as modified, delayed and/or cancelled depending upon the government’s requests, budgets, policies and/or changes in regulations. Contracts can also be terminated for the convenience of the government at any time the government believes that such termination would be in its best interests. In this circumstance, the Company is entitled to receive payments for its allowable costs and, in general, a proportionate share of its fee or profit for the work actually performed. The Company may also perform work prior to formal authorization or prior to adjustment of the contract price for increased work scope, change orders and other funding adjustments. In this situation, the Company is performing the work under our own risk and would be responsible for any costs incurred during this time. Additionally, the defense contract audit agency regularly audits the financial records of the Company. Such audits can result in adjustments to contract costs and fees. Audits have been completed through the Company’s fiscal year 2013 and have not resulted in any material adjustments.

Within the Hospitality Segment, PAR has dedicated sales teams engaging directly with our tier 1 (representing 2,000 sites and above), tier 2 (101-1,999 sites) and tier 3 (2 – 100 sites) customers. The Company also has dedicated channel partner executives who solely support our Brink and Pixel partners to effectively position and sell PAR’s software and hardware solutions to a wide range of customers.

Our strategic account sales organization concentrates on large chain, corporate customers and their franchisees globally. In addition, sales efforts are directed toward franchisees of large chains for which the Company is not necessarily the enterprise POS vendor. The Company’s Brink sales team includes a SMB sales team that focuses on Brink sales to multi-unit operators with 25-350 locations as well as major account sales executives to capture the Tier 1 and Tier 2 Brink target market. The Company’s international direct sales force markets to major global tier 1customers as well as regional international chains in restaurant and retail. With the support from our global partner team, PAR’s channel partners sell and support PAR PixelPoint in the U.S. and around the globe.

The Company’s indirect sales channel sales representatives enlist and support many well-regarded value-added resellers / partners serving the multi-unit operators, independent restaurant sector and non-foodservice markets such as retail, convenience, amusement parks, movie theaters, cruise lines, spas and other ticketing and entertainment venues.