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                                  UNITED STATES
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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549
                                    FORM 10-K

            [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934
                  For the Fiscal Year Ended December 31, 2007.
                                       OR
          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

             For the Transition Period From __________ to __________

                          Commission File Number 1-9720

                           PAR TECHNOLOGY CORPORATION
             (Exact name of registrant as specified in its charter)

          Delaware                                            16-1434688
(State or other jurisdiction of                            (I.R.S. Employer
incorporation or organization)                           Identification Number)

      PAR Technology Park
      8383 Seneca Turnpike
      New Hartford, New York                                   13413-4991
(Address of principal executive offices)                       (Zip Code)

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

        Securities registered pursuant to Section 12(b) of the Act: None

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

                                                     Name of Each Exchange on
  Title of Each Class                                    Which Registered
Common Stock, $.02 par value                          New York Stock Exchange

     Indicate by check mark if the registrant is a well-known  seasoned  issuer,
as defined in Rule 405 of the Securities Act. Yes [ ]  No [X]

     Indicate by check mark if the  registrant  is not  required to file reports
pursuant to Section 13 or Section 15(d) of the Act. Yes [ ]  No [X]

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

     Indicate by check mark if disclosure of delinquent  filers pursuant to Item
405 of Regulation S-K (is not contained  herein,  and will not be contained,  to
the  best  of  registrant's   knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part  III of this  Form  10-K or any
amendment to this Form 10-K. [ ]

     Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated  filer, a non-accelerated  filer, or a smaller reporting company.
See definitions of "large accelerated filer",  "accelerated filer", and "smaller
reporting  company"  in Rule  12b-2 of the  Exchange  Act.  (Check  one):  Large
Accelerated Filer [  ]  Accelerated Filer [X] Non-Accelerated Filer [ ] Smaller
reporting company [ ] (Do not check if a smaller reporting company)

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

     As of June  30,  2007,  the  last  business  day of the  registrant's  most
recently  completed  second fiscal  quarter,  the aggregate  market value of the
shares of voting common stock held by  non-affiliates  of the  registrant's  was
approximately  $66,781,916  based upon the closing price of the Company's common
stock.

     The  number of shares  outstanding  of  registrant's  common  stock,  as of
February 29, 2008 - 14,401,063 shares.

                       DOCUMENTS INCORPORATED BY REFERENCE

     Portions of the  registrant's  proxy  statement in connection with its 2008
annual meeting of stockholders are incorporated by reference into Part III.

--------------------------------------------------------------------------------
<PAGE>



                           PAR TECHNOLOGY CORPORATION

                                TABLE OF CONTENTS
                                    FORM 10-K

--------------------------------------------------------------------------------
     Item Number
--------------------------------------------------------------------------------

                                     PART I

         Item 1.        Business
         Item 1A.       Risk Factors
         Item 2.        Properties
         Item 3.        Legal Proceedings

                                     PART II

         Item 5.        Market for the Registrant's Common Equity, Related
                        Stockholder Matters and Issuer Purchases of
                        Equity Securities
         Item 6.        Selected Financial Data
         Item 7.        Management's Discussion and Analysis of
                        Financial Condition and Results of Operations
         Item 7A.       Quantitative and Qualitative Disclosures
                        About Market Risk
         Item 8.        Financial Statements and Supplementary Data
         Item 9A.       Controls and Procedures
         Item 9B.       Other Information

                                    PART III

         Item 10.       Directors, Executive Officers and
                          Corporate Governance
         Item 11.       Executive Compensation
         Item 12.       Security Ownership of Certain Beneficial Owners
                          and Management and Related Stockholder Matters
         Item 13.       Certain Relationships and Related Transactions,
                          and Director Independence
         Item 14.       Principal Accountant Fees and Services

                                     PART IV

         Item 15.       Exhibits, Financial Statement Schedules

                        Signatures


<PAGE>

"Safe Harbor"  Statement under the Private  Securities  Litigation Reform Act of
1995


     This document contains  "forward-looking  statements" within the meaning of
Section 27A of the  Securities  Act of 1933, as amended,  and Section 21E of the
Securities  Exchange Act of 1934.  Any  statements  in this document that do not
describe  historical  facts  are  forward-looking  statements.   Forward-looking
statements in this document (including  forward-looking statements regarding the
continued  health of the Hospitality  industry,  future  information  technology
outsourcing opportunities,  an expected increase in contract funding by the U.S.
Government, the impact of current world events on our results of operations, the
effects of  inflation  on our  margins,  and the  effects of  interest  rate and
foreign currency fluctuations on our results of operations) are made pursuant to
the safe harbor  provisions of the Private  Securities  Litigation Reform Act of
1995. When we use words such as "intend,"  "anticipate,"  "believe," "estimate,"
"plan,"  "will," or  "expect",  we are  making  forward-looking  statements.  We
believe that the assumptions and expectations  reflected in such forward-looking
statements  are  reasonable,  based on  information  available to us on the date
hereof,  but we cannot assure you that these  assumptions and expectations  will
prove to have been correct or that we will take any action that we presently may
be planning.  We have disclosed  certain  important factors that could cause our
actual  future  results  to  differ  materially  from our  current  expectation,
including  a decline  in the volume of  purchases  made by one or a group of our
major customers; risks in technology development and commercialization; risks of
downturns in economic conditions  generally,  and in the quick-service sector of
the hospitality market specifically; risks associated with government contracts;
risks associated with competition and competitive  pricing pressures;  and risks
related to foreign  operations.  Forward-looking  statements  made in connection
with  this  report  are  necessarily  qualified  by  these  factors.  We are not
undertaking  to update or revise  publicly any  forward-looking  statement if we
obtain new information or upon the occurrence of future events or otherwise.

<PAGE>


                           PAR TECHNOLOGY CORPORATION

                                     PART I


Item 1:  Business

     PAR Technology  Corporation (PAR or the Company)  conducts  business in two
distinct segments:  Hospitality and Government. PAR's core business is a leading
provider   of   technology   solutions,   including   hardware,   software   and
professional\traditional  services to businesses in the global  hospitality  and
specialty retail  industries.  The Company continues to be a primary supplier of
hospitality management technology systems to quick-service restaurants with over
45,000  systems  installed  in  more  than  105  countries.   PAR's  hospitality
management  software   applications  provide  for  the  efficient  operation  of
businesses and enterprises by managing  transaction  and  operational  data from
end-to-end and maximizing profitability through more efficient operations. PAR's
professional  services  mission  is to enable  businesses  to  achieve  the full
potential of their hospitality technology investment.

     PAR  continues  to be a  leading  provider  of  professional  services  and
enterprise  business  intelligence  technology to the hospitality  sector,  with
solid  long-term  relationships  with  the  restaurant  industry's  two  largest
corporations - McDonald's  Corporation and Yum! Brands, Inc. (Yum!).  McDonald's
has  over  31,000  restaurants  in more  than 120  countries  and PAR has been a
selected  provider  of  restaurant  technology  systems  and  lifecycle  support
services to  McDonald's  since 1980.  PAR was selected by McDonald's as its 2007
Technology Supplier of the Year. Yum! (which includes Taco Bell, KFC, Pizza Hut,
Long John  Silver's and A&W  Restaurants)  has been a loyal PAR  customer  since
1983.  Yum!  has over 33,000  units  globally  and PAR  continues to be the sole
approved supplier of management  technology  systems to Taco Bell as well as the
Point-of-Sale  (POS)  vendor  of  choice  to KFC  Corporate  Restaurants.  Other
significant hospitality chains where PAR is the POS vendor of choice are: Boston
Market,  CKE  Restaurants  (including  Hardees and Carl's Jr.),  Carnival Cruise
Lines,  Papa  Murphy's,  Corner  Bakery,  and  large  franchisees  of the  above
mentioned brands.

     In the fourth quarter of 2006, PAR acquired substantially all of the assets
of SIVA Corporation,  a privately held hospitality  technology  software company
and  a  provider  of  web-based  service  oriented  architected  (SOA)  software
applications to the hospitality industry. The acquisition included all of SIVA's
software and software technology as well as several existing contracts.
<PAGE>

     In  the  fourth  quarter  of  2005,  the  Company  acquired   PixelPoint(R)
Technologies,  Inc. (PixelPoint) a privately held hospitality technology company
and a provider of restaurant  management  software  applications  for full/table
service  dining.  PixelPoint  develops  and markets  POS,  WebPOS,  Wireless and
Enterprise  software suites for the restaurant  industry.  It currently  markets
software in multiple languages to many major economic centers  worldwide.  Their
integrated  software  solution  includes  enterprise   management,   a  wireless
application  that is seamless to their  connected  capability  and allows remote
order taking in the dining room,  on-line ordering  capability for customers via
the  internet,  and an  in-store  and  enterprise  level  loyalty  and gift card
information sharing application.

     In the fourth quarter of 2004, PAR acquired substantially all of the assets
of Springer-Miller  Systems,  Inc., a provider of hospitality technology systems
for  small  five  star  city-center  hotel  chains,  destination  spa  and  golf
properties,   timeshare  properties  and  five  star  resorts  worldwide.  PAR's
Hospitality  Management System is distinguished  from other property  management
systems with its integrated  design and unique  approach to guest  service.  The
product  suite  includes  more  than  20  seamlessly  integrated,  guest-centric
application modules which provide hotel/resort staff with the tools they need to
personalize service, surpass guest expectations, and increase property revenues.
PAR maintains a distinctive  customer  list in this  business  including  Pebble
Beach Resorts, The Four Seasons, Hard Rock Hotel & Casino, the Mandarin Oriental
Hotel Group, and Destination Hotels & Resorts.

     PAR's Government  business provides technical  expertise in the development
of  advanced  technology  systems  for  the  Department  of  Defense  and  other
Governmental  agencies.  Additionally,  PAR provides information  technology and
communications  support services to the U.S. Navy, U.S. Air Force and U.S. Army.
PAR focuses its computer-based  system design services on providing high quality
technical services,  ranging from experimental  studies to advanced  operational
systems,  within a variety  of areas of  research,  including  radar,  image and
signal processing,  logistics  management  systems,  and geospatial services and
products.  Through  Government-sponsored   research  and  development,  PAR  has
developed technologies with relevant commercial applications. A prime example of
this "technology transfer" is the Company's point-of-sale technology,  which was
derived from research and development  involving microchip processing technology
sponsored by the Department of Defense.  Our most recent technology  transfer is
PAR  Logistics  Management  Systems.  This PAR  initiative  brings  tracking and
security  solutions to the  intermodal  and land shipping  industry.  Through an
integrated GPS, RFID,  cellular,  SATCOM, and internet PAR solution,  owners and
operators of refrigeration,  tank, dry van, intermodal, and generator containers
have real time information on the status and location of assets and cargo around
the globe.
<PAGE>

     Information  concerning the Company's industry segments for the three years
ended  December 31, 2007 is set forth in Note 11 to the  Consolidated  Financial
Statements included elsewhere herein.

     The Company's  common stock is traded on the New York Stock  Exchange under
the symbol "PTC". Our corporate headquarters are located at PAR Technology Park,
8383 Seneca Turnpike, New Hartford, New York 13413-4991;  telephone number (315)
738-0600. Our website address is http://www.partech.com.  Through PAR's website,
its Annual  Report on Form 10-K,  quarterly  reports on Form 10-Q,  and  current
reports on Form 8-K and amendments thereto are available to interested  parties,
free of charge.  Information contained on our website is not part of this Annual
Report on Form 10-K.

     Unless the context otherwise requires,  the term "PAR" or "Company" as used
herein, means PAR Technology Corporation and its wholly-owned subsidiaries.

<PAGE>


                               Hospitality Segment

     PAR provides  restaurant  management  technology  solutions  which  combine
software applications,  an Intel(R)-based hardware platform and installation and
lifecycle support services.  PAR's restaurant management offering includes fixed
and  wireless  order-entry  terminals,   self-service  kiosks,  kitchen  systems
deployed on printers or video  monitors,  food  safety  monitoring  tools,  back
office  applications and enterprise  business  intelligence  software.  PAR also
provides  hospitality  management solutions that satisfy the property management
technology needs for an array of hospitality  enterprises,  including small five
star city-center  hotel chains,  destination spa and golf properties,  timeshare
properties  and five star  resorts  worldwide.  PAR  offers  extensive  service,
support,  systems  integration  and  professional  service  capabilities.  PAR's
service  professionals  design,  tailor,  implement and maintain  solutions that
enable  customers  to manage all  aspects of  operational  data  collection  and
processing for single or multiple site enterprises from a central location.

Products

     The Company's integrated hospitality management software applications allow
its customers to configure their  technology  systems to meet their order entry,
food preparation,  inventory,  labor and property management  coordination needs
while capturing all pertinent data  concerning the  transactions at the specific
location  and  delivering  it  throughout  the  enterprise.   PAR's  hospitality
management  systems are based on more than 28 years of experience and knowledge,
and an in-depth understanding of the hospitality marketplace. This knowledge and
expertise  is  reflected  in  the  innovative  product  design,   implementation
capability and systems integration skills.

Software

     The Company's range of restaurant  software  products cover the hospitality
market  with   offerings  that  meet  the   requirements   of  large  and  small
operators/corporations alike.

     PAR offers three major  point-of-sale  product lines.  The next  generation
iSIVA(R)  Point-of-Sale  software application is an enterprise-enabled  solution
built on a service-oriented architecture. iSIVA streamlines the order life-cycle
for table service,  counter service,  and bar operations,  while  simplifying IT
support with centralized  application management and real-time data transmission
between restaurant sites and the enterprise.
<PAGE>

     For  franchisees  in the quick  service  restaurant  (QSR) and fast  casual
segments, PAR offers the InTouch(TM) Point-of-Sale software application. InTouch
is a multi-brand  point of sale  application  containing  features and functions
such as real-time  mirror imaging of critical data,  on-line  graphical help and
interactive diagnostics, all presented with intuitive graphical user interfaces.
The  InSynch(TM)   Enterprise   Configuration  Manager  provides   business-wide
management  of the  InTouch  point-of-sale,  including  diverse  concept  menus,
security settings and system parameters.

     PixelPoint(R) is PAR's easy-to-use  solution  primarily sold to independent
restaurants  through the Company's  dealer  channel.  The PixelPoint  integrated
software solution includes the PixelPoint  Point-of-Sale  software  application,
PocketPOS  wireless  ordering  software,  Web-to-Go  on-line ordering  software,
HeadOffice  enterprise  management  software,  and MemberShare,  an in-store and
enterprise level Loyalty and Gift Card information sharing application.

     In addition to point-of-sale software, PAR offers a number of complementary
restaurant  technologies.  POS(2) and Pay2Go  extend  the  traditional  POS with
wireless order-taking and payment capabilities.  The IntelliKitchen(TM)  kitchen
management  system  distributes  and displays  kitchen  orders to maximize order
accuracy and increase staff  efficiency.  The InQuire(TM)  Above Store Reporting
software  application offers a web-based reporting platform utilizing the latest
technology from Microsoft's  .Net(R)  platform.  Additionally,  the feature-rich
InForm(TM)  Back  Office  software  suite  allows  restaurant  owners to control
critical  food and labor  costs using  intuitive  tools for  forecasting,  labor
scheduling and inventory management.

     In 2006, PAR acquired  technology that provides food safety  monitoring and
paperless Hazard Analysis Critical Control Point (HACCP) management.  HACCP is a
food  industry  standard  approach  implemented  to reduce the incidence of food
borne illness.  PAR's  iQuality(TM)  software runs on a wireless handheld device
equipped with a temperature probe to identify HACCP  checkpoints.  Captured data
is  transmitted  to the  enterprise  for  consolidated  reporting;  in addition,
application  configuration  is  web-based.  iQuality  is designed to replace the
paper checklist,  minimize human errors, increase HACCP compliance,  and improve
in-store efficiency.
<PAGE>

     PAR  continues to be a provider of software  solutions to the  hotel/resort
industry.  Today,  hospitality-oriented  businesses  have the  ability to manage
information and leverage their  relationships  with customers through integrated
technology  systems.  PAR's technology systems provide a seamless user interface
to manage all aspects of the guest experience as well as consolidating  customer
information  and history  into a central,  single  database.  PAR's  SMS|Host(R)
Hospitality Management System provides a complete set of tools at the fingertips
of hotel and spa staff for selling and delivering  personalized  guest services.
All business  functions are seamlessly  integrated  with the front office,  from
guest room check-in,  to spa  appointments,  or retail  purchases.  The SMS|Host
product suite, including over 20 seamlessly  integrated,  guest-centric modules,
provides hotel and resort staff with the tools they need to personalize service,
anticipate guest needs, and consistently exceed guest expectations. The SMS|Host
module,  SMS|Enterprise,  enables a chain or  management  company  to  instantly
create a real-time, single-image consolidation of all details from all locations
within a large  organization  for use as a  central  information  system or as a
fully   integrated   Property   Management    System(PMS)/Central    Reservation
System(CRS).

     PAR in addition offers SpaSoft(R) a stand-alone spa management application.
SpaSoft Spa Management  System is designed to satisfy the unique needs of resort
spas, day spas, and medi-spas. Validated by VISA(R) as compliant with CISP (Card
Information  Security  Program) Payment  Application  Best Practices,  SpaSoft's
unique booking engine,  advanced resource  inventory,  yield management  module,
scheduling,  management  and reporting  tools assist in the total  management of
sophisticated  hotel/resort spas and day spas.  Because SpaSoft was specifically
designed  for the  needs  of the spa  industry,  it  assists  the spa  staff  in
providing the individualized, impeccable guest service that their most important
clients desire and expect.

Hardware

     PAR's newest hardware  offering,  The Gemini(TM),  offers  customers proven
performance at a cost-conscious  price point.  Gemini is a technology refresh of
PAR's  popular  4th  generation  hardware  platforms.  PAR  continues  to  offer
ViGo(TM),  its  5th  generation  hardware  platform,  designed  to  be  durable,
scalable, integrated and highly serviceable. Both ViGo and POS4XP(TM), PAR's 4th
generation hardware platform, are Pentium-designed systems developed to host the
powerful point-of-sale  software applications in the hospitality industry.  Both
ViGo and  POS4XP  designs  utilize  open  architecture  with  industry  standard
components  and are  compatible  with the most popular  operating  systems.  The
hardware platforms support a distributed  processing environment and incorporate
an  advanced   hospitality   management   technology  system,   utilizing  Intel
microprocessors,  standard PC expansion slots, Ethernet LAN, standard Centronics
printer  ports  as  well  as  USB  ports.  The  hardware  systems  supply  their
industry-standard  components with features for hospitality applications such as
multiple  video  ports.   The  POS  systems   utilize   distributed   processing
architecture to integrate a broad range of PAR and  third-party  peripherals and
are designed to withstand  the harsh  hospitality  environments.  Both  hardware
platforms  have a  favorable  price-to-performance  ratio  over  the life of the
system  as a result  of  their  PC  compatibility,  ease of  expansion  and high
reliability design.
<PAGE>

     In 2007 PAR introduced the InfoKey(TM)  kiosk,  which features both a touch
screen and a keyboard in a clean,  approachable design.  Suitable for deployment
of a number of different software application types, from training and hiring to
promotional  content and nutrition  information,  the InfoKey enables restaurant
operators to create a self-service information hub for employees and guests.

Systems Installation and Professional Services

     PAR's ability to offer the full spectrum of installation,  maintenance, and
support services is one of the Company's key  differentiators.  PAR continues to
work in unison with its customers to identify and address the latest hospitality
technology   requirements  by  creating   interfaces  to  equipment,   including
innovations   such  as   automated   cooking   and   drink-dispensing   devices,
customer-activated  terminals and order display units located inside and outside
of the customer's  business site. The Company  provides its systems  integration
expertise to interface  specialized  components,  such as video  monitors,  coin
dispensers and  non-volatile  memory for  journalizing  transaction  data, as is
required in some international applications.

     PAR employs experienced individuals with diverse hospitality backgrounds in
both hotels/resorts and restaurants. PAR has the knowledge and expertise to help
its customers  structure  property  management  solutions which can be used most
effectively in  restaurants  and hotels,  with emphasis on maximizing  return on
investment.  In addition,  the Company has secured  strategic  partnerships with
third-party  organizations  to offer a variety  of  credit,  debit and gift card
payment  options  that allow  quick  service  restaurants,  convenience  stores,
gasoline  stations  and  drugstores  to process  cashless  payments  quickly and
efficiently.

     The Company's  Professional Services department  continuously evaluates new
technologies and adopts those that allow PAR to provide significant improvements
in customer's day-to-day systems. From hand-held wireless devices to advances in
internet  performance,  the technical  staff is available for  consultation on a
wide variety of topics including network infrastructures,  system functionality,
operating system platforms, and hardware expandability.
<PAGE>

Installation and Training

     In the United  States,  Canada,  Europe,  South  Africa,  the Middle  East,
Australia,  and Asia, PAR personnel are able to provide software  configuration,
installation, training and integration services as a normal part of the software
or equipment  purchase  agreement.  In certain areas of North and South America,
Europe,  and Asia, the Company provides these installation and training services
through  third  parties.  PAR is also  staffed to provide  complete  application
training  for a site's staff as well as technical  instruction  for  Information
Systems personnel.  The PAR training team is composed of experienced individuals
with diverse hospitality and technical backgrounds.

Maintenance and Service

     The Company offers a wide range of maintenance and support services as part
of its total solution for its targeted  hospitality  technology  markets. In the
North  American  region,  the Company  provides  comprehensive  maintenance  and
installation services for the Company's software, equipment and systems, as well
as those of third parties, through a 24/7 central telephone customer support and
diagnostic service in Boulder,  Colorado and Las Vegas,  Nevada. In addition the
Company has service centers in Europe, South Africa, the Middle East, Australia,
and Asia.  The  Company  believes  that its  ability to address  all support and
maintenance   requirements  for  a  customer's  hospitality  technology  network
provides it with a clear competitive advantage.

     The  Company  maintains  a field  service  network  consisting  of over 100
locations  offering  on-site  service  and  repair,  as  well as  depot  repair,
overnight unit  replacements  and spare unit rentals.  At the time a hospitality
technology  system is installed,  PAR trains customer  employees and managers to
ensure efficient and effective use of the system.  If an issue arises within the
Company's manufactured technology system (hardware and software),  PAR's current
service management  software products allow a service technician to diagnose the
problem by  telephone  or by remotely  dialing-in  to the system,  thus  greatly
reducing the need for on-site service calls.
<PAGE>

     The   Company's   service   organization   utilizes  a  suite  of  software
applications from Clarify,  Inc.  (Clarify) as its Customer Resource  Management
(CRM)  tool.   Clarify   allows  PAR  to   demonstrate   compelling   value  and
differentiation  to its customers  through the  utilization of its extensive and
ever-growing knowledge base to efficiently diagnose and resolve customer-service
issues.  Clarify also enables PAR to compile the kind of in-depth information it
needs to spot trends and identify  opportunities.  A second  software suite is a
call center CRM solution and knowledge base known as  Connect-Care by Firstwave.
Connect-Care  allows  PAR  to  maintain  a  profile  on  each  customer,   their
background,  hardware  and  software  details,  client  service  history,  and a
problem-resolution  database.  Analysis  of this  data  allows  the  Company  to
optimize  customer  service  by  identifying  trends  in calls  and to work with
customers to quickly resolve issues.

Sales & Marketing

     Sales in the  hospitality  technology  market are often  made to  corporate
chains where PAR is an approved  vendor.  Upon achieving such status,  marketing
efforts are directed to the chain's franchisees. Sales efforts are also directed
toward  franchisees of chains for which the Company is not an approved corporate
vendor.

     The Company  employs  direct sales  personnel in several sales groups.  The
Major  Accounts  Group works with the largest  chain  corporate  customers.  The
Domestic Sales Group targets  franchisees of the major chain customers,  as well
as smaller chains throughout the United States.  The  International  Sales Group
sells to major customers with global locations and to international  chains that
do not have a presence  in the  United  States.  The  Company's  Indirect  Sales
Channel targets non-foodservice markets such as retail,  convenience,  amusement
parks, movie theaters,  cruise lines, spas and other ticketing and entertainment
venues. This group also works with third-party dealers and value-added resellers
throughout the country.

     New sales in the  hotel/resort  technology  market are often  generated  by
leads,  be it by  referrals,  internet  searches,  media  coverage or trade show
presence.  Marketing  efforts are  conducted  in the form of email  newsletters,
direct  mail  campaigns,  trade  show  exhibitions,   advertising  and  targeted
telesales  calls.  The Company  employs direct sales  personnel in several sales
groups. The Domestic Sales Group targets independent,  business class and luxury
hotels and resorts and spas in the United States, Canada and the Caribbean.  The
International  Sales Group seeks sales to independent hotels and resorts outside
of the United States. The Corporate Accounts Sales Group works with high profile
corporate and chain clients such as Mandarin  Oriental Hotel Group,  Destination
Hotels and Resorts and West Paces Hotel Group. The Company's  Installed Accounts
Sales Group works solely with clients who have  already  installed  the SMS|Host
product   suite.   The   Business   Development   group   focuses  on  proactive
identification  of and initial  penetration  into new business  channels for the
SMS|Host and SpaSoft product lines worldwide.
<PAGE>

Competition

     The competitive  landscape in the hospitality market is driven primarily by
functionality,  reliability,  quality, pricing, service and support. The Company
believes  that its  principal  competitive  advantages  include  its focus on an
integrated  technology  solution offering,  advanced  development  capabilities,
in-depth  industry  knowledge and expertise,  excellent product  reliability,  a
direct  sales  force  organization,  and world class  support and quick  service
response.  The  markets  in which the  Company  transacts  business  are  highly
competitive.  Most of our major  customers have approved  several  suppliers who
offer some form of sophisticated  hospitality  technology system similar to that
of the Company.  Major competitors include Panasonic,  IBM Corporation,  Radiant
Systems, NCR, and Micros Systems.

Backlog

     Due to the nature of the Hospitality  business,  backlog is not significant
at any  point in  time.  The  Hospitality  segment  orders  are  generally  of a
short-term nature and are usually booked and shipped in the same fiscal year.

Research and Development

     The highly technical nature of the Company's  hospitality products requires
a significant and continuous  research and development  effort.  Ongoing product
research and quality  development efforts are an integral part of all activities
within the Company.  Functional  and technical  enhancements  are actively being
made to our  products to increase  customer  satisfaction  and maintain the high
caliber of our software.  Research and development  expenses were  approximately
$17,155,000  in 2007,  $11,802,000  in 2006 and  $9,355,000 in 2005. The Company
capitalizes  certain  software  costs in accordance  with Statement of Financial
Accounting Standards No. 86, Accounting for the Costs of Computer Software to be
Sold,  Leased or Otherwise  Marketed.  See Note 1 to the Consolidated  Financial
Statements included in Item 15 for further discussion.

Manufacturing and Suppliers

     The  Company  assembles  its  products  from  standard  components  such as
integrated  circuits and fabricated parts such as printed circuit boards,  metal
parts and castings.  Most  components are  manufactured  by third parties to the
Company's  specifications.  The  Company  depends on outside  suppliers  for the
continued  availability  of its  components  and parts.  Although most items are
generally available from a number of different suppliers,  the Company purchases
certain components consistently from one supplier. Items purchased from only one
supplier include certain printers,  base castings and electronic components.  If
such a supplier  should cease to supply an item,  the Company  believes that new
sources  could be found to  provide  the  components.  However,  added  cost and
manufacturing  delays  could  result and  adversely  affect the  business of the
Company.  The Company has not experienced  significant  delays of this nature in
the past,  but there can be no  assurance  that delays in delivery due to supply
shortages will not occur in the future.
<PAGE>

Intellectual Property

     The  Company  owns  or  has  rights  to  certain  patents,  copyrights  and
trademarks,  but believes none of these intellectual  property rights provides a
material   competitive   advantage.   The  Company  relies  upon  non-disclosure
agreements,  license  agreements  and  applicable  domestic and foreign  patent,
copyright and trademark laws for protection of its intellectual property. To the
extent such protective measures are unsuccessful,  or the Company needs to enter
into protracted  litigation to enforce such rights, the Company's business could
be  adversely  impacted.  Similarly  there is no  assurance  that the  Company's
products will not become the subject of a third-party  claim of  infringement or
misappropriation. To the extent such claims result in costly litigation or force
the Company to enter into royalty or license agreements,  rather than enter into
a prolonged  dispute,  the Company's business could be adversely  impacted.  The
Company also licenses certain third-party software with its products.  While the
Company has maintained a strong  relationship  with its  licensors,  there is no
assurance  that such  relationships  will  continue or that the licenses will be
continued under fees and terms acceptable to the Company.

<PAGE>


                               Government Segment

     PAR operates  two  wholly-owned  subsidiaries  in the  Government  business
segment, PAR Government Systems Corporation (PGSC) and Rome Research Corporation
(RRC). These companies provide services to the U.S.  Department of Defense (DoD)
and  other  federal  and state  government  organizations  with a wide  range of
technical  capability  and  scope.  Significant  areas  in which  the  Company's
services  are  involved  include:  design and  integration  of  state-of-the-art
imagery intelligence systems for information archive, retrieval, and processing;
advanced   research  and  development  for  imaging  sensors;   development  and
operations of logistics management systems; and engineering and support services
for Government information technology and communications facilities.

     The Company's  offerings cover the entire  development cycle for Government
systems,  including  requirements analysis,  design specification,  development,
implementation, installation, test and evaluation.

Information Systems and Technology

     The Information  Systems and Technology (IS&T) business sector supports the
development  of  integrated  systems  for  geospatial   information   archiving,
processing,  exploitation, and visualization.  IS&T is the systems developer and
integrator for the Air Force Research  Laboratory-Rome  Research (AFRL) and is a
key developer on the National Geospatial-Intelligence Agency (NGA) Image Product
Library (IPL) program.  The IPL provides access to a virtual network of archives
in support of the  operational  users of imagery.  The Company has a substantial
systems  integration  contract to support  interoperability  of new and emerging
commercial  imagery  exploitation and data management systems for U.S. Air Force
(USAF)  operations.  Since 1986,  the Company has been a key  contributor to the
full-scale  engineering  development  for the Joint  Surveillance  Target Attack
Radar  System  (Joint  STARS) and more  recently,  for the  Coastal  Battlefield
Reconnaissance and Analysis (COBRA) program.

Signal and Image Processing

     The  Signal  and  Image  Processing  (SIP)  business  sector  supports  the
development  and   implementation   of  complex  sensor  systems  including  the
collection  and  analysis of sensor  data.  The SIP group has  developed  sensor
concepts, algorithms, and real-time systems to address the difficult problems of
finding  low-contrast  targets against clutter  background,  detecting  man-made
objects in dense foliage, and performing  humanitarian efforts in support of the
removal of land mines with ground  penetrating  radar. The Company also supports
numerous technology  demonstrations for the DoD, including a multi-national NATO
exercise  of  wireless   communications   interoperability.   As  part  of  this
demonstration,  the Company  designed and built the Software  Radio  Development
System (SoRDS) for test and evaluation of communications  waveforms. The Company
has extended  this  technology  into public safety and law  enforcement  via the
Dynamic  Open   Architecture   Radio  System  (DOARS)  system,  a  multi-channel
communications gateway intended to solve the problem of wireless  communications
interoperability.  The Company also supports Navy airborne infrared surveillance
systems through the development of advanced optical sensors.
<PAGE>

Geospatial Software and Modeling

     The Geospatial  Software and Modeling (GS&M) business sector performs water
resources modeling;  Geographic Information Systems (GIS) based data management,
and geospatial information technology development.  In particular, the Company's
Flood*WareTM  software tool and  methodology is being utilized by New York State
in  support of the  Federal  Emergency  Management  Agency's  Map  Modernization
Program.  Similar technologies are used in support of water quality modeling and
assessment applications for the NYC Watershed Protection Program.

Logistics Management Systems

     The Logistics  Management  Systems  (LMS)  business  sector  focuses on the
design,  development,  deployment  and  commercialization  of the  CargoWatch(R)
Logistics  Information   Management  System.   CargoWatch  is  a  comprehensive,
end-to-end  solution for the  monitoring,  control and  management  of transport
assets and cargo  throughout the supply chain (i.e.,  port,  highway,  rail, and
ocean)  transportation  lifecycle.  The CargoWatch  system is being  implemented
under  a  multi-year   Cooperative   Agreement  with  the  U.S.   Department  of
Transportation/Maritime     Administration    (DOT/MARAD).    CargoWatch    uses
state-of-the-art  technology to acquire Global Positioning System (GPS) location
and equipment  status data.  Wireless  communication  networks then transmit the
data to the LMS Operations Center, and a powerful geospatial database customizes
the data to meet the needs of each  customer and provide it to the customer over
the  Internet  or via  direct  linkage  to  existing  (back-office)  information
systems.  LMS has developed and delivered unique,  value driven solutions to the
refrigerated transport and logistics markets.

Information Technology and Communications Support Services

     The Company  provides a wide range of  technical  and  support  services to
sustain  mission  critical  components  of  the  Department  of  Defense  Global
Information Grid (GIG).  These services include  continuous  operations,  system
enhancements  and maintenance of very low frequency  (VLF),  high frequency (HF)
and  very  high  frequency  (VHF)  radio  transmitter/receiver  facilities,  and
extremely  high  frequency  (EHF)  and  super  high  frequency  (SHF)  satellite
communication heavy earth terminal facilities. In addition to the communications
support of the GIG,  the Company  provides  information  technology  services to
maintain DoD  Metropolitan  Area,  Wide Area and Local Area Networks.  These DoD
communications  and  information  technology  services  are provided at customer
locations  in  and  outside  of  the  continental  United  States.  The  various
facilities,  operating  24/7,  are  integral  to the  command and control of the
nation's  air,  land and naval  forces,  and those of  United  States  coalition
allies.
<PAGE>

Test Laboratory and Range Operations

     The Company provides management,  engineering, and technical services under
several  contracts  with the U.S. Air Force and the U.S.  Navy.  These  services
include the planning,  execution,  and evaluation of tests at government  ranges
and laboratories operated and maintained by the Company. Test activities include
unique  components,  specialized  equipment,  and  advanced  systems  for radar,
communications, electronic counter-measures, and integrated weapons systems. The
Company also develops  complex  measurement  systems in several  defense-related
areas of technology.

Government Contracts

     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 its  contracts are for one-year to five-year  terms.  There are several risks
associated with Government contracts.  For example,  contracts may be terminated
for the convenience of the Government 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's  business  with the U.S.  Government  is also  subject to other  risks
unique to the defense industry,  such as reduction,  modification,  or delays of
contracts or subcontracts if the Government's requirements, budgets, policies or
regulations   change.  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.  Additionally,  the Defense
Contract  Audit  Agency on a regular  basis  audits the books and 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 2005 and have not
resulted in any material adjustments.
<PAGE>

Marketing and Competition

     Marketing  begins  with  collecting  information  from a variety of sources
concerning  the  present and future  requirements  of the  Government  and other
potential  customers  for the  types  of  technical  expertise  provided  by the
Company. Although the Company believes it is positioned well in its chosen areas
of  image  and  signal  processing,  information  technology/communications  and
engineering  services,  competition for Government contracts is intense. Many of
the Company's competitors are major corporations, or their subsidiaries, such as
Lockheed Martin,  Raytheon,  Northrop  Grumman,  BAE, Harris,  and SAIC that are
significantly larger and have substantially greater financial resources than the
Company.  The Company  also  competes  with many smaller  companies  that target
particular segments of the Government market. Contracts are obtained principally
through  competitive  proposals  in response to  solicitations  from  Government
agencies  and prime  contractors.  The  principal  competitive  factors are past
performance,   the  ability  to  perform,  price,  technological   capabilities,
management  capabilities and service. In addition, the Company sometimes obtains
contracts  by  submitting  unsolicited  proposals.  Many  of the  Company's  DoD
customers are now migrating to commercial software standards,  applications, and
solutions.  In that manner,  the Company is utilizing its internal  research and
development to migrate existing  solutions into software product lines that will
support the DoD geospatial community (i.e., NGA, USAF, etc.).

Backlog

     The dollar value of existing Government contracts at December 31, 2007, net
of  amounts  relating  to  work  performed  to  that  date,  was   approximately
$152,451,000,  of which  $41,691,000  was funded.  At  December  31,  2006,  the
comparable  amount  was  approximately  $96,637,000,  of which  $28,243,000  was
funded.  Funded  amounts  represent  those amounts  committed  under contract by
Government  agencies and prime  contractors.  The  December 31, 2007  Government
contract   backlog  of  $152,451,000   represents  firm,   existing   contracts.
Approximately $56,696,000 of this amount is expected to be completed in calendar
year 2008, as funding is committed.

<PAGE>
Employees

     As of December 31, 2007, the Company had 1,800 employees, approximately 57%
of whom are engaged in the Company's Hospitality segment, 40% of whom are in the
Government segment, and the remainder are corporate employees.

     Due to the highly technical nature of the Company's business, the Company's
future can be significantly  influenced by its ability to attract and retain its
technical  staff.  The  Company  believes  that it will be able to  fulfill  its
near-term needs for technical staff.

     Approximately  18% of the  Company's  employees  are covered by  collective
bargaining agreements. The Company considers its employee relations to be good.

Exchange Certifications

     The  certification of the CEO of PAR required by Section  303A.12(a) of the
New  York  Stock  Exchange  (NYSE)  Listed  Company  Manual,  relating  to PAR's
compliance with the NYSE's corporate governance listing standards, was submitted
to the NYSE on June 19, 2007 with no qualifications.

Item 1A:  Risk Factors

     We operate in a dynamic  and rapidly  changing  environment  that  involves
numerous risks and uncertainties.  The following section describes some, but not
all, of the risks and uncertainties that could have a material adverse effect on
our business, financial condition, results of operations and the market price of
our common stock,  and could cause our actual results to differ  materially from
those expressed or implied in our forward-looking statements.

A DECLINE  IN THE VOLUME OF  PURCHASES  MADE BY ANY ONE OF THE  COMPANY'S  MAJOR
CUSTOMERS WOULD MATERIALLY ADVERSELY AFFECT OUR BUSINESS.

     A small  number of related  customers  have  historically  accounted  for a
majority of the  Company's  net  revenues in any given  fiscal  period.  For the
fiscal years ended December 31, 2007, 2006 and 2005,  aggregate sales to our top
two Hospitality segment customers,  McDonald's and Yum! Brands, amounted to 40%,
40% and 41%,  respectively,  of total revenues.  Most of the Company's customers
are not  obligated to provide us with any minimum  level of future  purchases or
with binding  forecasts of product purchases for any future period. In addition,
major customers may elect to delay or otherwise change the timing of orders in a
manner that could adversely affect the Company's quarterly and annual results of
operations.  There can be no assurance that our current  customers will continue
to place  orders  with us,  or that we will be able to  obtain  orders  from new
customers.
<PAGE>

AN  INABILITY  TO  PRODUCE  NEW  PRODUCTS  THAT  KEEP  PACE  WITH  TECHNOLOGICAL
DEVELOPMENTS  AND CHANGING  MARKET  CONDITIONS  COULD RESULT IN A LOSS OF MARKET
SHARE.

     The  products  we sell  are  subject  to rapid  and  continual  changes  in
technology. Our competitors offer products that have an increasingly wider range
of features and capabilities. We believe that in order to compete effectively we
must provide systems incorporating new technologies at competitive prices. There
can be no  assurance  that we will be able  to  continue  funding  research  and
development at levels  sufficient to enhance our current product  offerings,  or
that the Company  will be able to develop and  introduce  on a timely  basis new
products that keep pace with  technological  developments and emerging  industry
standards  and address the  evolving  needs of  customers.  There also can be no
assurance that we will not experience  difficulties that will result in delaying
or preventing  the  successful  development,  introduction  and marketing of new
products  in our  existing  markets,  or  that  our  new  products  and  product
enhancements will adequately meet the requirements of the marketplace or achieve
any significant degree of market acceptance. Likewise, there can be no assurance
as to the  acceptance  of our  products  in new  markets,  nor can  there be any
assurance  as to the success of our  penetration  of these  markets,  nor to the
revenue  or  profit  margins  realized  by the  Company  with  respect  to these
products. If any of our competitors were to introduce superior software products
at competitive  prices,  or if our software products no longer meet the needs of
the  marketplace  due  to  technological   developments  and  emerging  industry
standards,  our software  products may no longer retain any  significant  market
share.

WE GENERATE MUCH OF OUR REVENUE FROM THE HOSPITALITY  INDUSTRY AND THEREFORE ARE
SUBJECT TO DECREASED REVENUES IN THE EVENT OF A DOWNTURN EITHER IN THAT INDUSTRY
OR IN THE ECONOMY AS A WHOLE.

     For the fiscal years ended  December 31,  2007,  2006 and 2005,  we derived
69%,  70% and 73%,  respectively,  of our total  revenues  from the  Hospitality
industry, primarily the quick service restaurant marketplace.  Consequently, our
Hospitality  technology  product sales are dependent in large part on the health
of the  Hospitality  industry,  which in turn is  dependent  on the domestic and
international  economy,  as well as factors such as consumer buying  preferences
and weather  conditions.  Instabilities  or downturns in the Hospitality  market
could  disproportionately  impact our  revenues,  as clients may either exit the
industry  or delay,  cancel or reduce  planned  expenditures  for our  products.
Although  we believe we can assist the quick  service  restaurant  sector of the
Hospitality industry in a competitive environment,  given the cyclical nature of
that industry,  there can be no assurance that our profitability and growth will
continue.
<PAGE>

WE DERIVE A PORTION OF OUR REVENUE  FROM  GOVERNMENT  CONTRACTS,  WHICH  CONTAIN
PROVISIONS UNIQUE TO PUBLIC SECTOR CUSTOMERS,  INCLUDING THE GOVERNMENT'S  RIGHT
TO MODIFY OR TERMINATE THESE CONTRACTS AT ANY TIME.

     For the fiscal years ended  December 31,  2007,  2006 and 2005,  we derived
31%, 30% and 27%, respectively,  of our total revenues from contracts to provide
technical  services  to  U.S.  Government  agencies  and  defense   contractors.
Contracts with U.S.  Government  agencies  typically provide that such contracts
are terminable at the convenience of the U.S. Government. If the U.S. Government
terminated a contract on this basis, we would be entitled to receive payment for
our allowable costs and, in general, a proportionate  share of our fee or profit
for work actually performed.  Most U.S. Government contracts are also subject to
modification or termination in the event of changes in funding.  As such, we may
perform  work  prior to formal  authorization,  or the  contract  prices  may be
adjusted  for  changes  in scope  of  work.  Termination  or  modification  of a
substantial  number  of our U.S.  Government  contracts  could  have a  material
adverse effect on our business, financial condition and results of operations.

     We perform  work for  various  U.S.  Government  agencies  and  departments
pursuant  to  fixed-price,  cost-plus  fixed  fee and  time-and-material,  prime
contracts  and  subcontracts.  Approximately  69% of the revenue that we derived
from  Government  contracts  for the year  ended  December  31,  2007  came from
fixed-price or time-and-material  contracts.  The balance of the revenue that we
derived from  Government  contracts in 2007 primarily came from cost-plus  fixed
fee contracts. Most of our contracts are for one-year to five-year terms.

     While  fixed-price  contracts  allow us to benefit from cost savings,  they
also expose us to the risk of cost overruns. If the initial estimates we use for
calculating  the  contract  price are  incorrect,  we can incur  losses on those
contracts.  In addition,  some of our  governmental  contracts  have  provisions
relating  to cost  controls  and audit  rights and, if we fail to meet the terms
specified in those contracts, then we may not realize their full benefits. Lower
earnings  caused by cost overruns  would have an adverse effect on our financial
results.
<PAGE>

     Under  time-and-materials  contracts,  we are paid for labor at  negotiated
hourly  billing  rates  and for  certain  expenses.  Under  cost-plus  fixed fee
contracts,  we are reimbursed for allowable costs and paid a fixed fee. However,
if our costs under either of these types of contract exceed the contract ceiling
or are  not  allowable  under  the  provisions  of the  contract  or  applicable
regulations, we may not be able to obtain reimbursement for all of our costs.

     If we are unable to control costs incurred in performing under each type of
contract,  such inability to control costs could have a material  adverse effect
on our financial  condition  and  operating  results.  Cost  over-runs  also may
adversely  affect our ability to sustain  existing  programs  and obtain  future
contract awards.

WE FACE  EXTENSIVE  COMPETITION  IN THE  MARKETS  IN WHICH WE  OPERATE,  AND OUR
FAILURE TO COMPETE EFFECTIVELY COULD RESULT IN PRICE REDUCTIONS AND/OR DECREASED
DEMAND FOR OUR PRODUCTS AND SERVICES.

     There are  several  suppliers  who  offer  Hospitality  management  systems
similar to ours.  Some of these  competitors are larger than PAR and have access
to substantially greater financial and other resources and, consequently, may be
able to obtain more favorable terms than we can for components and subassemblies
incorporated  into  these  Hospitality  technology  products.  The rapid rate of
technological  change in the  Hospitality  industry makes it likely that we will
face competition from new products designed by companies not currently competing
with us.  These new products may have  features not  currently  available on our
Hospitality  products.  We believe that our  competitive  ability depends on our
total  solution  offering,  our  product  development  and  systems  integration
capability, our direct sales force and our customer service organization.  There
is no assurance,  however,  that we will be able to compete  effectively  in the
hospitality technology market in the future.

     Our Government  contracting  business has been focused on niche  offerings,
primarily signal and image processing,  information  technology  outsourcing and
engineering  services.  Many of our  competitors  are, or are  subsidiaries  of,
companies such as Lockheed Martin,  Raytheon,  Northrop Grumman, BAE, Harris and
SAIC.  These  companies  are larger  and have  substantially  greater  financial
resources  than we do.  We also  compete  with  smaller  companies  that  target
particular  segments of the  Government  market.  These  companies may be better
positioned to obtain  contracts  through  competitive  proposals.  Consequently,
there are no assurances  that we will continue to win Government  contracts as a
prime contractor or subcontractor.
<PAGE>

WE MAY  NOT BE  ABLE  TO  MEET  THE  UNIQUE  OPERATIONAL,  LEGAL  AND  FINANCIAL
CHALLENGES  THAT  RELATE TO OUR  INTERNATIONAL  OPERATIONS,  WHICH MAY LIMIT THE
GROWTH OF OUR BUSINESS.

     For the fiscal  years  ended  December  31,  2007,  2006 and 2005,  our net
revenues   from  sales  outside  the  United  States  were  14%,  13%  and  11%,
respectively,  of the Company's total revenues. We anticipate that international
sales will continue to account for a significant  portion of sales. We intend to
continue  to expand  our  operations  outside  the  United  States  and to enter
additional  international  markets,  which will require  significant  management
attention and  financial  resources.  Our  operating  results are subject to the
risks inherent in international sales, including, but not limited to, regulatory
requirements,  political  and  economic  changes and  disruptions,  geopolitical
disputes and war,  transportation delays,  difficulties in staffing and managing
foreign sales operations, and potentially adverse tax consequences. In addition,
fluctuations in exchange rates may render our products less competitive relative
to local  product  offerings,  or  could  result  in  foreign  exchange  losses,
depending  upon the  currency  in which we sell our  products.  There  can be no
assurance  that these  factors  will not have a material  adverse  affect on our
future international sales and, consequently, on our operating results.

OUR  BUSINESS  DEPENDS  ON A  LARGE  NUMBER  OF  HIGHLY  QUALIFIED  PROFESSIONAL
EMPLOYEES  AND, IF WE ARE NOT ABLE TO RECRUIT AND RETAIN A SUFFICIENT  NUMBER OF
THESE  EMPLOYEES,  WE WOULD NOT BE ABLE TO PROVIDE HIGH QUALITY  SERVICES TO OUR
CURRENT AND FUTURE CUSTOMERS, WHICH WOULD HAVE AN ADVERSE EFFECT ON OUR REVENUES
AND OPERATING RESULTS.

     We actively compete for qualified  professional  staff. The availability or
lack thereof of qualified  professional  staff may affect our ability to develop
new products and to provide  services and meet the needs of our customers in the
future. An inability to fulfill customer requirements due to a lack of available
qualified  staff at agreed upon salary rates may adversely  impact our operating
results in the future.

A SIGNIFICANT  PORTION OF OUR TOTAL ASSETS CONSISTS OF GOODWILL AND IDENTIFIABLE
INTANGIBLE  ASSETS,  WHICH ARE SUBJECT TO A PERIODIC  IMPAIRMENT  ANALYSIS AND A
SIGNIFICANT IMPAIRMENT  DETERMINATION IN ANY FUTURE PERIOD COULD HAVE AN ADVERSE
EFFECT ON OUR RESULTS OF OPERATIONS  EVEN WITHOUT A SIGNIFICANT  LOSS OF REVENUE
OR INCREASE IN CASH EXPENSES ATTRIBUTABLE TO SUCH PERIOD.

     We have goodwill and identifiable  intangible assets totaling approximately
$27  million and $9.9  million at December  31,  2007,  respectively,  resulting
primarily from several  business  acquisitions.  At least annually,  we evaluate
goodwill and  identifiable  intangible  assets for impairment  based on the fair
value of the reporting  unit to which these assets  relate.  This estimated fair
<PAGE>

value could change if we are unable to achieve  operating  results at the levels
that have been  forecasted,  the market  valuation of such  companies  decreases
based on  transactions  involving  similar  companies,  or there is a permanent,
negative  change in the market  demand for the services  offered by the business
unit.  These changes could result in an impairment of the existing  goodwill and
identifiable  intangible  asset balances that could require a material  non-cash
charge to our results of operations.

Item 2:  Properties

     The  following  are the  principal  facilities  (by square  footage) of the
Company:

                        Industry              Floor Area             Number of
      Location          Segment           Principal Operations         Sq. Ft.
      --------          -------           --------------------       ----------

New Hartford, NY      Hospitality       Principal executive offices,    138,500
                      Government          manufacturing, research and
                                          development laboratories,
                                          computing facilities
Rome, NY              Government        Research and development          52,800
Stowe, VT             Hospitality       Sales, service and research       26,000
                                          and development
Boulder, CO           Hospitality       Service                           22,500
Boca Raton, FL        Hospitality       Research and development          14,900
Sydney, Australia     Hospitality       Sales and service                 14,000
Las Vegas, NV         Hospitality       Service                            8,800
Vaughn, Canada        Hospitality       Sales, service and research and    8,000
                                          development
Toronto, Canada       Hospitality       Sales, service and research and    7,700
                                          development


     The Company's  headquarters and principal  business  facility is located in
New Hartford, New York, which is near Utica, located in Central New York State.
<PAGE>

     The Company owns its principal facility and adjacent space in New Hartford,
N.Y. All of the other facilities are leased for varying terms. Substantially all
of the Company's  facilities are fully utilized,  well maintained,  and suitable
for use. The Company  believes its present and planned  facilities and equipment
are adequate to service its current and immediately foreseeable business needs.

Item 3:  Legal Proceedings

     The Company is subject to legal  proceedings  which  arise in the  ordinary
course of business.  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.

                                     PART II


Item 5: Market for the Registrant's  Common Equity,  Related Stockholder Matters
and Issuer Purchases of Equity Securities

     The  Company's  Common Stock,  par value $.02 per share,  trades on the New
York Stock  Exchange  (NYSE  symbol - PTC).  At December  31,  2007,  there were
approximately  453 owners of record of the Company's  Common  Stock,  plus those
owners whose stock certificates are held by brokers.

     The  following  table shows the high and low stock prices for the two years
ended December 31, 2007 as reported by New York Stock Exchange:

                                 2007                     2006
                        ---------------------    -----------------------
     Period                Low         High         Low           High
------------------      ---------   ---------    ---------    ----------

First Quarter           $   8.31    $   10.18    $   17.22    $   22.73
Second Quarter          $   8.26    $   10.87    $   10.61    $   18.60
Third Quarter           $   7.62    $    8.90    $    7.40    $   13.01
Fourth Quarter          $   6.81    $    8.99    $    7.07    $    9.24

     The Company has not paid cash dividends on its Common Stock,  and its Board
of Directors  presently  intends to continue to retain earnings for reinvestment
in growth opportunities.  Accordingly,  it is anticipated that no cash dividends
will be paid in the foreseeable future.
<PAGE>


     On November 14, 2005, the Company's  Board of Directors  declared a 3 for 2
stock split in the form of a stock  dividend that was  distributed on January 6,
2006 to  shareholders  of record on December 12,  2005.  All share and per share
data  in  these  consolidated  financial  statements  and  footnotes  have  been
retroactively  restated  as if the stock split had  occurred as of the  earliest
period presented.

Item 6:  Selected Financial Data


                 SELECTED CONSOLIDATED STATEMENT OF INCOME DATA
                    (In thousands, except per share amounts)

     The following  selected  historical  consolidated  financial data should be
read in conjunction with the Consolidated  Financial  Statements and the related
notes and  "Management's  Discussion  and  Analysis of Financial  Condition  and
Results of Operations" included elsewhere in this Annual Report on Form 10-K.
<TABLE>
<CAPTION>

                                                           Year ended December 31,
                                         -------------------------------------------------------------
                                             2007       2006         2005         2004         2003
                                         -------------------------------------------------------------

<S>                                      <C>          <C>          <C>          <C>          <C>
Net revenues .........................   $ 209,484    $ 208,667    $ 205,639    $ 174,884    $ 139,770

Cost of sales ........................   $ 157,576    $ 153,158    $ 150,053    $ 137,738    $ 110,777

Gross margin .........................   $  51,908    $  55,509    $  55,586    $  37,146    $  28,993

Selling, general & administrative ....   $  37,517    $  33,440    $  30,867    $  22,106    $  19,340

Benefit (provision) for income taxes .   $   1,497    $  (3,146)   $  (5,358)   $  (3,729)   $  (1,593)

Income (loss) from
  continuing operations ..............   $  (2,708)   $   5,721    $   9,432    $   5,635    $   2,792

Basic earnings (loss) per share from
  continuing operations ..............   $    (.19)   $     .40    $     .68    $     .43    $     .22

Diluted earnings (loss) per share from
 continuing operations ...............   $    (.19)   $     .39    $     .64    $     .41    $     .21

</TABLE>

     The selected  consolidated  financial  statement data  summarized  above is
reflective of business acquisitions in 2006 and 2005, as discussed in Note 2 and
reflects the adoption of accounting pronouncements as discussed in Note 1 to the
Consolidated Financial Statements.
<PAGE>

                    SELECTED CONSOLIDATED BALANCE SHEET DATA
                                 (In thousands)

                                          December 31,
                       -----------------------------------------------------
                         2007        2006      2005       2004       2003
                       ----------------------------------------------------
Current assets .....   $ 97,879   $ 95,991   $ 84,492   $ 77,696   $ 74,195
Current liabilities    $ 52,284   $ 46,473   $ 43,661   $ 45,159   $ 29,816
Total assets .......   $146,518   $142,796   $125,149   $111,752   $ 87,147
Long-term debt .....   $  6,932   $  7,708   $  1,948   $  2,005   $  2,092
Shareholders' equity   $ 84,987   $ 86,083   $ 78,492   $ 63,574   $ 55,239

     The selected  consolidated  financial  statement data  summarized  above is
reflective of business  acquisitions in 2006 and 2005, as discussed in Note 2 to
the Consolidated Financial Statements.

     On November 14, 2005, the Company's  Board of Directors  declared a 3 for 2
stock split in the form of a stock  dividend that was  distributed on January 6,
2006 to  shareholders  of record on December 12,  2005.  All share and per share
data  in  these  consolidated  financial  statements  and  footnotes  have  been
retroactively  restated  as if the stock split had  occurred as of the  earliest
period presented.

Item 7: Management's  Discussion and Analysis of Financial Condition and Results
of Operations

Forward-Looking Statements

     This document contains  "forward-looking  statements" within the meaning of
Section 27A of the  Securities  Act of 1933, as amended,  and Section 21E of the
Securities  Exchange Act of 1934.  Any  statements  in this document that do not
describe  historical  facts  are  forward-looking  statements.   Forward-looking
statements in this document (including  forward-looking statements regarding the
continued  health of the Hospitality  industry,  future  information  technology
outsourcing opportunities,  an expected increase in contract funding by the U.S.
Government, the impact of current world events on our results of operations, the
effects of  inflation  on our  margins,  and the  effects of  interest  rate and
foreign currency fluctuations on our results of operations) are made pursuant to
the safe harbor  provisions of the Private  Securities  Litigation Reform Act of
1995. When we use words such as "intend,"  "anticipate,"  "believe," "estimate,"
"plan,"  "will," or  "expect",  we are  making  forward-looking  statements.  We
believe that the assumptions and expectations  reflected in such forward-looking
statements  are  reasonable,  based on  information  available to us on the date
hereof,  but we cannot assure you that these  assumptions and expectations  will
prove to have been correct or that we will take any action that we presently may
be planning.  We have disclosed  certain  important factors that could cause our
actual  future  results  to differ  materially  from our  current  expectations,
including  a decline  in the volume of  purchases  made by one or a group of our
major customers; risks in technology development and commercialization; risks of
downturns in economic conditions  generally,  and in the quick-service sector of
the hospitality market specifically; risks associated with government contracts;
risks associated with competition and competitive  pricing pressures;  and risks
related to foreign  operations.  Forward-looking  statements  made in connection
with  this  report  are  necessarily  qualified  by  these  factors.  We are not
undertaking to update or revise  publicly any  forward-looking  statements if we
obtain new information or upon the occurrence of future events or otherwise.
<PAGE>

Overview

     PAR is a leading  provider of  hospitality  systems that include  software,
hardware and a variety of services to several industries including: restaurants,
hotels/resorts/spas, cruise lines and specialty retailers. The Company is also a
provider to the Federal Government,  and its agencies, of applied technology and
technical services primarily with the Department of Defense.

     The Company's hospitality products are used in a variety of applications by
numerous  customers.  The  Company  faces  competition  in all  of  its  markets
(restaurants,  hotels,  etc.) and  competes  primarily  on the basis of  product
design/features,  product  quality/reliability,  price,  customer  service,  and
delivery capability.  Recently the trend amongst our hospitality customers is to
consolidate  their lists of  approved  vendors to  companies  that have a global
reach,  can achieve  quality  and  delivery  standards,  have  multiple  product
offerings,  R&D  capability,  and can be  competitive  with their  pricing.  PAR
believes  that its  global  reach as a  hospitality  technology  provider  is an
important  competitive  advantage as it allows the Company to provide innovative
products,  with significant delivery  capability,  globally to its multinational
customers like McDonald's, Yum! Brands and the Mandarin Oriental Hotel Group.

     In the fourth quarter of 2006, PAR acquired substantially all of the assets
of SIVA Corporation,  a privately held hospitality  technology  software company
and  a  provider  of  web-based  service  oriented  architected  (SOA)  software
applications to the hospitality industry. The acquisition included all of SIVA's
software and software technology as well as several existing  contracts.  During
2005 the Company acquired PixelPoint Technologies of Toronto,  Ontario,  Canada.
PixelPoint  designs  software  specifically for the table service segment of the
restaurant industry and the Company views this business as a natural progression
of the Company to be the  dominant  supplier of  hospitality  technology  across
several vertical industries.

     PAR's strategy is to provide completely  integrated  technology systems and
services along with a high level of customer  service in the markets in which it
competes.  The Company directs its research and  development  efforts to develop
cutting-edge  products that meet and exceed our  customers'  needs and also have
high  probability  for broader market appeal and success.  PAR also focuses upon
operating   efficiencies  and  controlling   costs.  This  is  achieved  through
investment  in  modern  production  technologies,  and  by  managing  purchasing
processes and functions.

     In 2007,  the Company  undertook an internal  investment  strategy in three
distinct areas of its hospitality  segment.  First, the Company made significant
investments in its development of next generation  software.  Additionally,  the
Company  invested  in  building a more  robust,  further  reaching  distribution
channel. Lastly, as the Company's customers expand in international markets, PAR
has  invested  in  constructing  an  international   infrastructure,   initially
concentrating  on the  Asia/Pacific  rim due to the new  restaurant  growth  and
concentration of PAR's customers in that region.

     In the hotel/resort business, PAR installed new property management systems
at several leading resorts  including Ponte Vidra Beach Resort,  the Glen Eagles
Hotel in Scotland,  the MotorCity  Casino Hotel and Capella  Hotels & Resorts to
list a brief sample.

     Approximately 31% of the Company's revenues are generated in our Government
Business segment. This segment is comprised of two subsidiaries:  PAR Government
Systems Corporation and Rome Research Corporation.  Through these two government
contractors,  the Company provides IT and communications support services to the
U.S.  Navy,  Air Force and Army.  In  addition,  PAR also offers its services to
several  non-military  U.S.  federal,  state and  local  agencies.  The  Company
provides  applied   technology   services  including  radar,  image  and  signal
processing,  logistics management systems, and geospatial services and products.
The  Company's  record  Government  performance  rating  allows  the  Company to
continually win repeat business and long-term  client-vendor  relationships with
their contract  customers.  PAR can provide its clients the technical  expertise
necessary to  facilitate  and operate  complex  systems  utilized by  government
agencies.  In 2007 PAR was awarded  several new contracts with the Department of
Defense,  including  contract  work at the Air Force's  Rome  Laboratory  in NY,
Robins Air Force Base,  Tinker Air Force Base,  NAVSOC at Point Magu, CA and the
Navy Transmitter  Facility at Dixon, CA. PAR Logistics Management Systems signed
new  business  with JB Hunt  Transport  Services,  Inc.  and NYK Line to provide
tracking and monitoring services for commercial refrigerated containers.
<PAGE>

     The Company will continue to leverage its core technical  capabilities  and
performance  into related  technical  areas and an expanding  customer base. The
Company will seek to accelerate  this growth through  strategic  acquisitions of
businesses that broaden the Company's technology and/or business base.

Summary

     The Company believes it can be successful in its two core business segments
-Hospitality  and  Government  - due to its focus and  industry  expertise.  PAR
remains  committed to streamlining  operations and improving  return on invested
capital through a variety of initiatives.

     The following table sets forth the Company's revenues by reportable segment
for the year ended December 31 (in thousands):

                               2007       2006       2005
                            ---------  ---------  ---------
Revenues:
     Hospitality .........   $144,486   $145,216   $149,457
     Government ..........     64,998     63,451     56,182
                             --------   --------   --------
Total consolidated revenue   $209,484    208,667   $205,639
                             ========   ========   ========

     The following discussion and analysis highlights items having a significant
effect on operations  during the three year period ended December 31, 2007. This
discussion may not be indicative of future operations or earnings.  It should be
read in conjunction with the audited annual  consolidated  financial  statements
and notes thereto and other  financial and statistical  information  included in
this report.

Results of Operations  --  2007 Compared to 2006

     The Company reported revenues of $209.5 million for the year ended December
31, 2007,  virtually  unchanged  from the $208.7  million  reported for the year
ended  December 31, 2006. The Company's net loss for the year ended December 31,
2007 was $2.7  million,  or $.19  diluted  net loss per share,  compared  to net
income of $5.7 million and $.39 diluted net income per share for the same period
in 2006.
<PAGE>

     Product revenues from the Company's  Hospitality segment were $77.1 million
for the year ended  December 31,  2007, a decrease of 7% from the $83.2  million
recorded in 2006.  This decrease was due to an $8.3 million  decline in domestic
product sales primarily due to a continued delay in hardware orders from a major
customer  pending the release of that customer's new third party  software.  The
decline was also due to the Company's  delay in replacing  hardware and software
business associated with last year's orders from two new customers. This drop in
domestic   revenue  was  partially   offset  by  a  $2.2  million   increase  in
international product sales. Approximately $900,000 of the international revenue
increase  was due to  currency  fluctuations.  This  increase  was the result of
growth in sales to the  Company's  restaurant  customers  in Asia and Canada and
property management systems in Europe and Latin America.

     Customer service  revenues are also generated by the Company's  Hospitality
segment.  The  Company's  service  offerings  include   installation,   software
maintenance,  training, twenty-four hour help desk support and various depot and
on-site service  options.  Customer  service revenues were $67.4 million for the
year ended  December 31, 2007, a 9% increase  from $62 million  reported for the
same period in 2006.  Approximately $3 million of this growth was related to the
award of a new service  contract with a major customer in October of 2006.  Also
contributing  to the growth was an increase in software  maintenance  contracts.
This was partially offset by a decline in installation  revenue due to the lower
product revenue.

     Contract  revenues from the Company's  Government  segment were $65 million
for the year ended  December  31, 2007,  an increase of 2% when  compared to the
$63.5  million  recorded  in  the  same  period  in  2006.  The  primary  factor
contributing  to the  growth was a $1.9  million  increase  in revenue  from the
Company's information  technology  outsourcing contracts for facility operations
at critical U.S. Department of Defense telecommunication sites across the globe.
These outsourcing operations provided by the Company directly support U.S. Navy,
Air Force and Army operations as they seek to convert their military information
technology  communications facilities into contractor-run operations and to meet
new requirements with contractor support.

     Product margins for the year ended December 31, 2007 were 40.8%, a decrease
of 160 basis points from the 42.4% for the year ended  December  31, 2006.  This
decline in margins was primarily  attributable to a decrease in software revenue
in 2007 when compared to 2006. The Company has not replaced the software revenue
associated with two new customers in 2006.
<PAGE>

     Customer  Service  margins were 24.2% for the year ended  December 31, 2007
compared to 25.2% for the same period in 2006.  This  decrease was primarily due
to the  obsolescence  of service  parts for a  discontinued  product  line.  The
decline was also due to lower than planned installation revenue directly related
to the decrease in product revenue.  This adversely  impacted the utilization of
installation personnel.

     Contract margins were 6.4% for the year ended December 31, 2007 versus 7.2%
for the same period in 2006.  The decrease was due, in part, to a favorable cost
share  adjustment on the Company's  Logistics  Management  Program in 2006.  The
decrease  was also  attributable  to start  up costs  incurred  in 2007 on a new
Information  Technology outsourcing contract with the Navy. The most significant
components  of contract  costs in 2007 and 2006 were labor and fringe  benefits.
For 2007,  labor and fringe benefits were $48.4 million or 79% of contract costs
compared to $45.9 million or 78% of contract costs for the same period in 2006.

     Selling,  general and administrative  expenses are virtually all related to
the Company's Hospitality segment.  Selling, general and administrative expenses
for the year ended December 31, 2007 were $37.5 million, an increase of 12% from
the $33.4 million  expense for the same period in 2006. This increase was due to
growth in sales and marketing  expenses  associated with restaurant  products as
the  Company  is  investing  in  its  international  infrastructure  and  in the
expansion of its dealer channel. The increase was also due to a rise in bad debt
expense due to an increase in write-offs related to various customers.

     Research  and  development  expenses  relate  primarily  to  the  Company's
Hospitality  segment.  Research and development  expenses were $17.2 million for
the year ended  December  31,  2007,  an increase of 45% from the $11.8  million
recorded in 2006.  This  increase was  primarily  attributable  to the Company's
continued research and development in its next generation  software products for
its restaurant customers.  The platform for this next generation of products was
acquired from SIVA Corporation in the fourth quarter of 2006.

     Amortization  of  identifiable  intangible  assets was $1.6 million for the
year ended  December 31, 2007 compared to $1.3 million for 2006. The increase is
primarily due to amortization of intangible assets of SIVA Corporation which was
acquired on November 2, 2006.
<PAGE>

     Other  income,  net, was $1.2 million for the year ended  December 31, 2007
compared  to  $617,000  for the same  period  in 2006.  Other  income  primarily
includes  rental income and foreign  currency gains and losses.  The increase is
primarily due to an increase in foreign currency gains in 2007 compared to 2006.

     Interest expense  represents  interest charged on the Company's  short-term
borrowing  requirements from banks and from long-term debt. Interest expense was
$1.1  million  for the year ended  December  31, 2007 as compared to $734,000 in
2006.  The Company  experienced  a higher  borrowing  interest rate in 2007 when
compared to 2006. The Company also  recognized  interest  expense related to its
interest rate swap agreement that was entered into in September  2007.  This was
partially offset by lower than average borrowings during 2007 versus 2006.

     For the year ended  December 31, 2007, the Company's  effective  income tax
rate was a benefit  of 35.6%,  compared  to a  provision  of 35.5% in 2006.  The
variance from the federal  statutory rate in 2007 was primarily due to the state
income tax  benefits  resulting  from the pretax loss and  certain tax  credits,
offset by various  nondeductible  expenses which decreased the tax benefit.  The
variance  from the federal  statutory  rate in 2006 was  primarily  due to state
income taxes, offset by benefits related to export sales as well as tax benefits
related to domestic production activities.

Results of Operations  --  2006 Compared to 2005

     The Company reported revenues of $208.7 million for the year ended December
31,  2006,  an increase of 1.5% from the $205.6  million  reported  for the year
ended  December 31, 2005.  The Company's net income for the year ended  December
31, 2006 was $5.7 million, or $.39 diluted net income per share, compared to net
income of $9.4 million and $.64 per diluted share for the same period in 2005.

     Product revenues from the Company's  Hospitality segment were $83.2 million
for the year ended  December 31,  2006, a decrease of 9% from the $91.1  million
recorded in 2005.  This  decrease was due to a $9.2 million  decline in domestic
product sales  primarily due to lower hardware  sales to Hospitality  customers.
This drop in domestic revenue was partially offset by a $4.9 million increase in
international  product sales. This increase was the result of growth in sales to
the Company's restaurant customers in Asia and Europe.
<PAGE>

     Customer service  revenues are also generated by the Company's  Hospitality
segment.  The  Company's  service  offerings  include   installation,   software
maintenance,  training, twenty-four hour help desk support and various depot and
on-site service options. Customer service revenues were $62 million for the year
ended December 31, 2006, a 6% increase from $58.3 million  reported for the same
period in 2005. The Company  experienced  growth in its field service,  software
maintenance  and depot repair  revenues  for its  Hospitality  customers  due to
expansion of the Company's customer base. This was partially offset by a decline
in installation revenue due to the lower product revenue.

     Contract revenues from the Company's  Government segment were $63.5 million
for the year ended  December 31, 2006,  an increase of 13% when  compared to the
$56.2  million  recorded  in  the  same  period  in  2005.  The  primary  factor
contributing  to the growth was a $3.4  million  increase in applied  technology
contracts including the Company's work in providing technical assistance for the
development of battle planning software used by the Air Force. Also contributing
was a $3 million increase in revenue from the Company's  information  technology
outsourcing  contracts for facility  operations  at critical U.S.  Department of
Defense  telecommunication  sites across the globe. These outsourcing operations
provided  by the  Company  directly  support  U.S.  Navy,  Air  Force  and  Army
operations  as they  seek  to  convert  their  military  information  technology
communications  facilities  into  contractor-run  operations  and  to  meet  new
requirements with contractor support.

     Product  margins  for the year  ended  December  31,  2006  were 42.4 %, an
increase  of 100 basis  points  from the 41.4% for the year ended  December  31,
2005.  This  increase in margins was  primarily  attributable  to an increase in
software revenue in 2006 when compared to 2005.

     Customer  Service  margins were 25.2% for the year ended  December 31, 2006
compared  to 24.2% for the same  period in 2005.  This  increase is due to lower
material costs and an increase in software maintenance revenue.

     Contract margins were 7.2% for the year ended December 31, 2006 versus 6.7%
for the same period in 2005. This increase is primarily due to higher margins on
certain fixed price  contracts and to a favorable  cost share  adjustment on the
Company's  Logistics  Management  Program.  The most  significant  components of
contract costs in 2006 and 2005 were labor and fringe benefits.  For 2006, labor
and fringe  benefits  were $45.9  million or 78% of contract  costs  compared to
$39.4  million or 75% of contract  costs for the same  period in 2005.
<PAGE>
     Selling,  general and administrative  expenses are virtually all related to
the Company's Hospitality segment.  Selling, general and administrative expenses
for the year ended December 31, 2006 were $33.4 million,  an increase of 8% from
the $30.9  million  expense  for the same  period  in 2005.  This  increase  was
primarily  due to a  rise  in  sales  and  marketing  expenses  associated  with
restaurant  products as the Company is planning for future  growth  including in
international   markets.   The   Company's   2005   acquisition   of  PixelPoint
Technologies,  Inc. also  contributed  to this  increase.  Other reasons for the
expense growth include start up costs on a new customer service contract in 2006
and stock based compensation  expense which was not required to be recognized in
2005.

     Research  and  development  expenses  relate  primarily  to  the  Company's
Hospitality  segment.  Research and development  expenses were $11.8 million for
the year ended  December  31,  2006,  an increase  of 26% from the $9.4  million
recorded in 2005.  The  increase was  primarily  attributable  to the  Company's
continued research and development in its hardware and software products for its
restaurant,  resort and spa  customers.  The increase also reflects the research
and development  expenses  related to the SIVA acquisition in the fourth quarter
of 2006 and to the PixelPoint acquisition in the fourth quarter of 2005.

     Amortization  of  identifiable  intangible  assets was $1.3 million for the
year ended  December 31, 2006  compared to $1 million for 2005.  The increase is
primarily  due  to  amortization  relating  to  the  acquisition  of  PixelPoint
Technologies,  Inc. on October 4, 2005, and to the SIVA  acquisition on November
2, 2006.

     Other  income,  net,  was  $617,000  for the year ended  December  31, 2006
compared  to  $743,000  for the same  period  in 2005.  Other  income  primarily
includes  rental income and foreign  currency gains and losses.  The decrease is
primarily due to lower foreign currency gains in 2006 compared to 2005.

     Interest expense  represents  interest charged on the Company's  short-term
borrowing  requirements from banks and from long-term debt. Interest expense was
$734,000  for the year ended  December 31, 2006 as compared to $287,000 in 2005.
The Company  experienced a higher  borrowing  interest  rate and higher  average
borrowings in 2006 when compared to 2005.

     For the year ended  December 31, 2006, the Company's  effective  income tax
rate  was  35.5%,  compared  to 36.2% in 2005.  The  variance  from the  federal
statutory rate in 2006 and 2005 was primarily due to state income taxes,  offset
by benefits  related to export sales as well as tax benefits related to domestic
production activities.
<PAGE>

Liquidity and Capital Resources

     The  Company's  primary  sources  of  liquidity  have  been  cash flow from
operations and lines of credit with various  banks.  Cash provided by continuing
operations  was $8.7 million for the year ended  December  31, 2007  compared to
cash used of $3.6  million for 2006.  In 2007,  cash was  generated  through the
timing of  payments  to vendors  and the timing of  customer  payments on annual
service  contracts.  This was offset by a growth in inventory in anticipation of
future demand.  In 2006,  cash was used to finance the growth in receivables and
inventory. This was partially offset by cash generated from operating profits.

     Cash used in  investing  activities  was $3.5  million  for the year  ended
December  31,  2007 versus  $7.8  million for the same period in 2006.  In 2007,
capital  expenditures  were $2 million and were primarily for  manufacturing and
research and  development  equipment.  Capitalized  software  costs  relating to
software  development of Hospitality segment products were $1.2 million in 2007.
The amount paid as a contingent  purchase price under prior years'  acquisitions
totaled $278,000 in 2007. In 2006,  capital  expenditures  were $1.2 million and
were  principally  for  manufacturing  and  information   technology  equipment.
Capitalized  software  costs  relating to software  development  of  Hospitality
segment  products were $822,000 in 2006. In 2006,  the Company used $5.8 million
in cash for the acquisition of SIVA Corporation

     Cash used in  financing  activities  was $5.3  million  for the year  ended
December 31, 2007 versus $10.5 million of cash  provided in 2006.  In 2007,  the
Company  reduced its  short-term  borrowings  by $5.2 million and  decreased its
long-term  debt by  $244,000.  The  Company  also  benefited  $203,000  from the
exercise  of  employee  stock  options.  In  2006,  the  Company  increased  its
short-term  borrowings by $4.2 million and increased its long-term  debt by $5.9
million.  This increase was  principally due to debt incurred in connection with
the acquisition of SIVA  Corporation.  The Company also benefited  $352,000 from
the exercise of employee stock options.

     The Company has an aggregate  availability of $20,000,000 in unsecured bank
lines of  credit.  One line  totaling  $12,500,000  bears  interest  at the bank
borrowing  rate  (6.75% at December  31,  2007).  The second line of  $7,500,000
allows 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 (6.85% at
December 31, 2007). These facilities contains certain loan covenants including a
<PAGE>

leverage ratio of not greater than 3:5 to 1 and a fixed charge coverage ratio of
not less than 4 to 1. In June 2007,  these  credit  agreements  were  amended to
waive the existing  leverage and fixed charge  coverage ratios for the remainder
of 2007. Under the amendment,  the Company was required to meet a minimum EBITDA
requirement  for the balance of 2007. In the fourth quarter of 2007, the Company
did not attain the required EBITDA covenant but received  waivers from its banks
from this requirement.  In addition,  in January and February 2008, these credit
agreements  were amended to modify the  requirement for leverage ratio and fixed
charge  coverage  ratio  through  June of 2008.  The original  covenants  become
effective for the quarter ended September 30, 2008 and  thereafter.  These lines
expire in April 2009. At December 31, 2007 and 2006,  there was  $2,500,000  and
$7,713,000  outstanding  under these lines,  respectively.  The weighted average
interest rate paid by the Company during 2007 and 2006 was 6.6%.

     In 2006,  the Company  borrowed  $6,000,000  under an  unsecured  term loan
agreement with a bank in connection  with the  acquisition of SIVA  Corporation.
The loan provides for interest  only  payments in the first year and  escalating
principal  payments through 2012. The loan bears interest at the LIBOR rate plus
the applicable interest rate spread (7.25% at December 31, 2007).

     In September 2007, the Company entered into an interest rate swap agreement
associated  with the $6,000,000  loan discussed in the preceding  paragraph.  At
December 31, 2007,  the  notional  principal  amount  totaled  $5,850,000.  This
instrument  was  utilized  by the  Company  to  minimize  significant  unplanned
fluctuations in earnings and cash flows caused by interest rate volatility.  The
Company did not adopt hedge  accounting  under the  provisions  of  Statement of
Financial  Accounting  Standards  (SFAS)  No.  133,  Accounting  for  Derivative
Instruments  and Hedging  Activities,  but rather  records the fair market value
adjustments  through the consolidated  statements of operations each period. The
associated fair value adjustment included within the consolidated  statements of
operations  for the year ended December 31, 2007 was $154,000 and is included as
an increase to interest expense.

     The  Company  has a  $1,854,000  mortgage  collateralized  by certain  real
estate.  The annual mortgage payment  including  interest totals  $226,000.  The
mortgage bears interest at a fixed rate of 7% and matures in 2010.
<PAGE>

     The Company's  future  principal  payments under its term loan and mortgage
are as follows (in thousands):

                      2008                $    772
                      2009                   1,079
                      2010                   2,928
                      2011                   1,575
                      2012                   1,350
                                          --------
                                          $  7,704
                                          ========

         The Company's future minimum obligations under non-cancelable operating
leases are as follows (in thousands):

                      2008                $  2,382
                      2009                   1,793
                      2010                   1,024
                      2011                     716
                      2012                     575
                      Thereafter             1,789
                                          --------
                                          $  8,279
                                          ========

     During  fiscal  year  2008,  the  Company   anticipates  that  its  capital
requirements  will be  approximately  $2 to $3  million.  The  Company  does not
usually  enter  into long term  contracts  with its  major  Hospitality  segment
customers.  The Company commits to purchasing inventory from its suppliers based
on a combination  of internal  forecasts  and the actual orders from  customers.
This process,  along with good relations with  suppliers,  minimizes the working
capital investment required by the Company. Although the Company lists two major
customers,  McDonald's  and Yum!  Brands,  it sells to  hundreds  of  individual
franchisees of these corporations, each of which is individually responsible for
its own debts. These broadly made sales  substantially  reduce the impact on the
Company's  liquidity  if one  individual  franchisee  reduces  the volume of its
purchases  from the  Company in a given  year.  The  Company,  based on internal
forecasts,  believes  its  existing  cash,  line of  credit  facilities  and its
anticipated operating cash flow will be sufficient to meet its cash requirements
through at least the next twelve months.  However,  the Company may be required,
or could elect,  to seek  additional  funding prior to that time.  The Company's
future capital  requirements  will depend on many factors  including its rate of
revenue growth, the timing and extent of spending to support product development
efforts,  expansion of sales and marketing,  the timing of  introductions of new
products and  enhancements to existing  products,  and market  acceptance of its
products.  The Company  cannot assure that  additional  equity or debt financing
will be  available  on  acceptable  terms or at all.  The  Company's  sources of
liquidity  beyond  twelve  months,  in  management's  opinion,  will be its cash
balances on hand at that time,  funds  provided by operations,  funds  available
through  its lines of credit and the  long-term  credit  facilities  that it can
arrange.
<PAGE>

Critical Accounting Policies

     The  Company's   consolidated   financial   statements  are  based  on  the
application  of U.S.  generally  accepted  accounting  principles  (GAAP).  GAAP
requires  the  use  of  estimates,   assumptions,   judgments   and   subjective
interpretations  of  accounting  principles  that have an impact on the  assets,
liabilities,  revenue and expense amounts reported. The Company believes its use
of  estimates  and  underlying  accounting  assumptions  adhere  to GAAP and are
consistently   applied.   Valuations   based  on  estimates   are  reviewed  for
reasonableness  and  adequacy on a  consistent  basis  throughout  the  Company.
Primary areas where  financial  information of the Company is subject to the use
of  estimates,  assumptions  and the  application  of judgment  include  revenue
recognition, accounts receivable, inventories, intangible assets and taxes.

Revenue Recognition Policy

     The Company recognizes  revenue generated by the Hospitality  segment using
the  guidance  from SEC  Staff  Accounting  Bulletin  (SAB)  No.  104,  "Revenue
Recognition" and the AICPA Statement of Position (SOP) 97-2,  "Software  Revenue
Recognition."  Product  revenues  consist  of  sales of the  Company's  standard
point-of-sale  and  property  management  systems  of the  Hospitality  segment.
Product  revenues  include both  hardware and software  sales.  The Company also
records service  revenues  relating to its standard  point-of-sale  and property
management systems of the Hospitality segment.

     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) as
under SAB No. 104, persuasive  evidence of an arrangement  exists,  delivery has
occurred,  the price is fixed or determinable,  and collectibility is reasonably
assured.

     Software

     Revenue recognition on software sales generally occurs upon delivery to the
customer  site (or when  shipped  for  systems  that  are not  installed  by the
Company)  as under SOP  97-2,  persuasive  evidence  of an  arrangement  exists,
delivery has occurred, the price is fixed or determinable, and collectibility is
reasonably assured.  For software sales 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.
<PAGE>

     Service

     Service revenue  consists of installation  and training  services,  support
maintenance,  and field and depot  repair.  Installation  and  training  service
revenue are based upon standard  hourly/daily rates 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 recognized ratably over the underlying contract period.

     The  individual   product  and  service  offerings  that  are  included  in
arrangements  with our customers  are  identified  and priced  separately to the
customer based upon the stand alone price for each individual product or service
sold in the arrangement irrespective of the combination of products and services
which are included in a particular arrangement. As such, the units of accounting
are based on each individual  product and service sold, and revenue is allocated
to each  element  based on vendor  specific  objective  evidence  (VSOE) of fair
value.  VSOE of fair value for each  individual  product and service is based on
separate individual prices of these products and services.  The sales price used
to  establish  fair  value is the  sales  price of the  element  when it is sold
individually  in a  separate  arrangement  and not as a  separate  element  in a
multiple element arrangement.

     Contracts

     The Company recognizes revenue in its Government segment using the guidance
from SEC SAB No. 104,  Revenue  Recognition.  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.
<PAGE>

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.  We continuously monitor 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.   While  such  credit  losses  have  historically  been  within  our
expectations and appropriate reserves have been established, we cannot guarantee
that we will  continue  to  experience  the same  credit loss rates that we have
experienced in the past. 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 and changes in technology to provide for excess and obsolescence reserves
to properly value inventory.

Capitalized Software Development Costs

     The  Company  capitalizes  certain  costs  related  to the  development  of
computer  software used in its  Hospitality  segment under the  requirements  of
Statement of Financial  Accounting Standards No. 86, Accounting for the Costs of
Computer  Software  to  be  Sold,  Leased,  or  Otherwise   Marketed.   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  technological  feasibility  are
capitalized  and amortized over the estimated  economic life when the product is
available for general release to customers.
<PAGE>
Goodwill

     Following  Financial  Accounting  Standards  Board issuance of Statement of
Financial  Accounting  Standards No. 142, Goodwill and Other Intangible  Assets,
(SFAS 142),  the Company  tests all goodwill for  impairment  annually,  or more
frequently  if  circumstances  indicate  potential  impairment.  The Company has
elected to  annually  test for  impairment  in the fourth  quarter of its fiscal
year.

Taxes

     The  Company  has  significant  amounts of  deferred  tax  assets  that are
reviewed for recoverability and valued  accordingly.  These assets are evaluated
by using  estimates  of future  taxable  income and the  impact of tax  planning
strategies.  Valuations  related to tax  accruals  and assets can be impacted by
changes to tax codes, changes in statutory tax rates and the Company's estimates
of its future taxable income levels.

Recent Accounting Pronouncements

     Financial  Accounting  Standards  Board  (FASB)  Interpretation  No. 48 was
issued in July 2006 to clarify the criteria for  recognizing  tax benefits under
FAS Statement No. 109,  Accounting for Income Taxes. The Interpretation  defines
the  threshold  for  recognizing  the  benefits of tax return  positions  in the
financial  statements  as  "more-likely-than-not"  to be sustained by the taxing
authority and will affect many companies' reported results and their disclosures
of uncertain tax positions.  The  Interpretation  does not prescribe the type of
evidence required to support meeting the more-likely-than-not threshold, stating
that  it  depends  on  the  individual  facts  and  circumstances.  The  benefit
recognized  for a tax  position  meeting the  more-likely-than-not  criterion is
measured based on the largest  benefit that is more than 50 percent likely to be
realized.  The  measurement of the related  benefit is determined by considering
the   probabilities  of  the  amounts  that  could  be  realized  upon  ultimate
settlement,  assuming the taxing  authority  has full  knowledge of all relevant
facts and including expected  negotiated  settlements with the taxing authority.
FASB Interpretation 48 is effective as of the beginning of the first fiscal year
beginning after December 15, 2006 (the Company's 2007 fiscal year). This did not
have a material impact on the 2007 consolidated financial statements.

     In September  2006,  the FASB issued SFAS No. 157, Fair Value  Measurements
(SFAS 157),  which provides  guidance for measuring the fair value of assets and
liabilities,   as  well  as  requires  expanded  disclosures  about  fair  value
measurements.  SFAS 157 indicates that fair value should be determined  based on
<PAGE>

the  assumptions  marketplace  participants  would use in  pricing  the asset or
liability,  and provides  additional  guidelines to consider in determining  the
market-based  measurement.  The  Company  will be  required to adopt SFAS 157 on
January 1, 2008. The Company is currently evaluating the impact of adopting SFAS
157 on its consolidated financial statements.

     In February  2007,  the FASB issued SFAS No. 159, The Fair Value Option for
Financial  Assets and  Financial  Liabilities  (SFAS 159).  SFAS 159 permits all
entities to choose to measure eligible items at fair value at specified election
dates.  SFAS 159 is  effective as of the  beginning of an entity's  first fiscal
year that begins after November 15, 2007. The Company is currently assessing the
impact of adopting SFAS 159 on its consolidated financial statements.

     In December  2007,  the FASB issued SFAS No.141  (revised  2007),  Business
Combinations  (SFAS  141(R)).  The objective of this Statement is to improve the
relevance,  representational  faithfulness, and comparability of the information
that a reporting  entity  provides  in its  financial  reports  about a business
combination.  Specifically,  it establishes principles and requirements over how
the acquirer (1) recognizes and measures the identifiable  assets acquired,  the
liabilities  assumed,  and any  noncontrolling  interest  in the  acquiree;  (2)
recognizes and measures goodwill acquired in the business  combination or a gain
from a bargain  purchase,  and; (3) determines  what  information to disclose to
enable users of the  financial  statements  to evaluate the nature and financial
effects of the business  combination.  This  Statement  is effective  for fiscal
years  beginning  after  December 15, 2008  (fiscal  year 2009).  The Company is
currently  assessing  the impact of  adopting  SFAS  141(R) on its  consolidated
financial statements.

     In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in
Consolidated  Financial  Statements  an amendment of ARB No. 51 (SFAS 160).  The
objective of this  Statement  is to improve the  relevance,  comparability,  and
transparency of the financial  information  that a reporting  entity provides in
its consolidated  financial statements by establishing  accounting and reporting
standards for the noncontrolling  interest in a subsidiary  (minority interests)
and for the  deconsolidation  of a subsidiary.  This  Statement is effective for
fiscal years,  and interim  periods within those fiscal years,  beginning  after
December  15, 2008 (fiscal year 2009).  The Company is currently  assessing  the
impact of adopting this SFAS 160 on its consolidated financial statements.
<PAGE>

Item 7A.  Quantitative and Qualitative Disclosures about Market Risk

INFLATION

     Inflation  had little  effect on revenues  and related  costs  during 2007.
Management  anticipates that margins will be maintained at acceptable  levels to
minimize the effects of inflation, if any.

INTEREST RATES

     As of December 31, 2007, the Company has $5.2 million in variable long-term
debt and $3.2 million in variable  short-term debt. The Company believes that an
adverse  change in interest  rates of 100 basis points would not have a material
impact on our  business,  financial  condition,  results of  operations  or cash
flows.

     In September 2007, the Company entered into an interest rate swap agreement
associated  with a $6,000,000  variable  rate loan with  principal  and interest
payments due through August 2012. At December 31, 2007,  the notional  principal
amount  totaled  $5,850,000.  This  instrument  was  utilized  by the Company to
minimize significant unplanned fluctuations in earnings and cash flows caused by
interest rate  volatility.  The Company did not adopt hedge accounting under the
provisions of SFAS Statement No. 133, Accounting for Derivative  Instruments and
Hedging Activities, but rather records the fair market value adjustments through
the consolidated statements of operations each period. The associated fair value
adjustment  included  within the  consolidated  statements of operations for the
year ended  December  31,  2007 was  $154,000  and is included  within  interest
expense.

FOREIGN CURRENCY

     The Company's  primary exposures relate to certain  non-dollar  denominated
sales and operating  expenses in Europe and Asia.  These primary  currencies are
the Euro, the Australian  dollar and the Singapore dollar.  Management  believes
that foreign currency  fluctuations  should not have a significant impact on our
business,  financial conditions,  results of operations or cash flows due to the
low volume of business affected by foreign currencies.

Item 8: Financial Statements and Supplementary Data

     The Company's 2007  consolidated  financial  statements,  together with the
reports thereon of KPMG LLP dated March 17, 2008, are included elsewhere herein.
See Item 15 for a list of Financial Statements.
<PAGE>

Item 9A: Controls and Procedures

     1. Evaluation of Disclosure Controls and Procedures.

     Based on an evaluation of the Company's  disclosure controls and procedures
(as defined in Rule 13a-15(e) and 15d - 15(e) under the Securities  Exchange Act
of 1934) as of the end of the period covered by this Annual Report on Form 10-K,
conducted under the supervision of and with the  participation  of the Company's
chief  executive  officer  and  chief  financial  officer,  such  officers  have
concluded that the Company's  disclosure controls and procedures are designed to
ensure that  information  required to be disclosed by the Company in the reports
that it  files  or  submits  under  the  Exchange  Act is  recorded,  processed,
summarized and reported within the time periods specified in the SEC's rules and
forms, and are operating in an effective manner.

     2. Management's Annual Report on Internal Control over Financial Reporting.

     PAR's management is responsible for  establishing and maintaining  adequate
internal control over financial reporting. The Company's internal control system
was  designed to provide  reasonable  assurance to  management  and the Board of
Directors regarding the preparation and fair presentation of published financial
statements in accordance with U.S. generally accepted accounting principles.

     A company's  internal  control  over  financial  reporting  includes  those
policies and procedures  that (a) pertain to the maintenance of records that, in
reasonable   detail,   accurately  and  fairly  reflect  the   transactions  and
dispositions of the assets of the company; (b) provide reasonable assurance that
transactions  are  recorded as  necessary  to permit  preparation  of  financial
statements in accordance with generally accepted accounting principles, and that
receipts and  expenditures of the company are being made only in accordance with
authorizations  of  management  and  directors of the  company;  and (c) provide
reasonable  assurance  regarding  prevention or timely detection of unauthorized
acquisition,  use or  disposition  of the  company's  assets  that  could have a
material effect on the financial statements.

     All internal  control systems,  no matter how well designed,  have inherent
limitations.  Therefore,  even those  systems  determined  to be  effective  can
provide  only   reasonable   assurance  with  respect  to  financial   statement
preparation  and  presentation.  Because  of  inherent  limitations  due to, for
example,  the potential for human error or circumvention  of controls,  internal
controls over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of  effectiveness to future periods are subject to
the risk that controls may become  inadequate  because of changes in conditions,
or  that  the  degree  of  compliance   with  the  policies  or  procedures  may
deteriorate.
<PAGE>

     PAR's  management  assessed the  effectiveness  of the  Company's  internal
control  over  financial  reporting  as of  December  31,  2007.  In making this
assessment,  management  used  the  criteria  set  forth  by  the  Committee  of
Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control -
Integrated framework.  Based on its assessment,  management believes that, as of
December  31, the  Company's  internal  control  over  financial  reporting  was
effective based on those criteria.

     3. Attestation Report of Independent Registered Public Accounting Firm.

     The  effectiveness of our internal  control over financial  reporting as of
December  31,  2007 has been  audited by KPMG LLP,  our  independent  registered
public  accounting firm. KPMG LLP's related report is included within Item 15 of
this Form 10-K.

     4. Changes in Internal Controls over Financial Reporting

     During the period covered by this Annual Report on Form 10-K, there were no
changes in the Company's  internal control over financial  reporting (as defined
in Rule 13 a-15(f)) that have materially  affected,  or are reasonably likely to
materially affect, the Company's internal control over financial reporting.

Item 9B: Other Information

     The Company entered into  amendments (the  Amendments) of its bank lines of
credit,  as set  forth in this  Annual  Report  on Form  10-K,  on June 2007 and
January and  February  2008;  copies of such  Amendments  have been  attached as
exhibits to this Annual Report on Form 10-K.

<PAGE>


                                    PART III

Item 10: Directors, Executive Officers and Corporate Governance

     The  information  required  by this item  will  appear  under  the  caption
"Directors,  Executive Officers and Corporate Governance" in our 2008 definitive
proxy  statement  for the  annual  meeting  of  stockholders  in May 2008 and is
incorporated herein by reference.

Item 11: Executive Compensation

     The  information  required  by this item  will  appear  under  the  caption
"Executive  Compensation"  in our 2008 definitive proxy statement for the annual
meeting of stockholders in May 2008 and is incorporated herein by reference.

Item 12:  Security  Ownership of Certain  Beneficial  Owners and  Management and
Related Stockholder Matters

     The  information  required  by this item  will  appear  under  the  caption
"Security  Ownership Of Management  And Certain  Beneficial  Owners" in our 2008
definitive  proxy  statement for the annual meeting of  stockholders in May 2008
and is incorporated herein by reference.

Item  13:  Certain   Relationships  and  Related   Transactions,   and  Director
Independence

     The  information  required  by this item  will  appear  under  the  caption
"Executive  Compensation"  in our 2008 definitive proxy statement for the annual
meeting of stockholders in May 2008 and is incorporated herein by reference.

Item 14: Principal Accountant Fees and Services

     The  response  to this  item  will  appear  under  the  caption  "Principal
Accountant  Fees and Services" in our 2008  definitive  proxy  statement for the
annual  meeting  of  stockholders  in May 2008  and is  incorporated  herein  by
reference.
<PAGE>


                                     PART IV

Item 15: Exhibits, Financial Statement Schedules



(a) Documents filed as a part of the Form 10-K

              Financial Statements:
              ---------------------

              Report of Independent Registered Public Accounting Firm

              Consolidated Balance Sheets at December 31, 2007 and 2006

              Consolidated Statements of Operations for the three
              years ended December 31, 2007

              Consolidated Statements of Comprehensive Income (Loss)
              for the three years ended December 31, 2007

              Consolidated Statements of Changes in Shareholders' Equity for
              the three years ended December 31, 2007

              Consolidated Statements of Cash Flows for the three years
              ended December 31, 2007

              Notes to Consolidated Financial Statements


(b) Exhibits

       See list of exhibits.



<PAGE>


Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholders
PAR Technology Corporation:

We  have  audited  the  consolidated  financial  statements  of  PAR  Technology
Corporation  as of December 31, 2007 and 2006,  and for each of the years in the
three-year period ended December 31, 2007, as listed in the accompanying  index.
We  also  have  audited  PAR  Technology  Corporation's  internal  control  over
financial  reporting as of December 31, 2007,  based on criteria  established in
Internal  Control - Integrated  Framework  issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). PAR Technology's  management is
responsible  for  these  consolidated  financial  statements,   for  maintaining
effective internal control over financial  reporting,  and for its assessment of
the effectiveness of internal control over financial reporting,  included in the
accompanying  Management's Report on Internal Control over Financial  Reporting.
Our  responsibility  is to express an  opinion on these  consolidated  financial
statements  and an opinion on the  Company's  internal  control  over  financial
reporting based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements are free of material  misstatement  and whether  effective
internal  control  over  financial  reporting  was  maintained  in all  material
respects.   Our  audits  of  the  consolidated   financial  statements  included
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  financial   statements,   assessing  the  accounting  principles  used  and
significant  estimates made by management,  and evaluating the overall financial
statement  presentation.  Our audit of internal control over financial reporting
included   obtaining  an   understanding  of  internal  control  over  financial
reporting,  assessing the risk that a material weakness exists,  and testing and
evaluating the design and operating  effectiveness  of internal control based on
the assessed risk. Our audits also included  performing such other procedures as
we considered necessary in the circumstances. We believe that our audits provide
a reasonable basis for our opinions.

A company's  internal control over financial  reporting is a process designed to
provide reasonable  assurance  regarding the reliability of financial  reporting
and the preparation of financial  statements for external purposes in accordance
with generally accepted accounting principles. A company's internal control over
financial  reporting  includes those policies and procedures that (1) pertain to
the  maintenance  of records that, in reasonable  detail,  accurately and fairly
reflect the  transactions  and  dispositions  of the assets of the company;  (2)
provide  reasonable  assurance  that  transactions  are recorded as necessary to
permit preparation of financial statements in accordance with generally accepted
accounting  principles,  and that receipts and  expenditures  of the company are
being made only in accordance with authorizations of management and directors of
the company; and (3) provide reasonable assurance regarding prevention or timely
detection of  unauthorized  acquisition,  use, or  disposition  of the company's
assets that could have a material effect on the financial statements.

Because of its inherent  limitations,  internal control over financial reporting
may not prevent or detect misstatements.  Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate  because of changes in  conditions,  or that the degree of compliance
with the policies or procedures may deteriorate.
<PAGE>

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the  financial  position of PAR  Technology
Corporation  as of December 31, 2007 and 2006, and the results of its operations
and its cash flows for each of the years in the three-year period ended December
31, 2007, in conformity with  accounting  principles  generally  accepted in the
United  States of  America.  Also in our  opinion,  PAR  Technology  Corporation
maintained, in all material respects,  effective internal control over financial
reporting  as of December 31, 2007,  based on criteria  established  in Internal
Control  -  Integrated   Framework   issued  by  the   Committee  of  Sponsoring
Organizations of the Treadway Commission.

As  discussed  in  notes  1  and 7 to  the  consolidated  financial  statements,
effective  January  1,  2006,  the  Company  adopted  the fair  value  method of
accounting  for stock based  compensation  as required by Statement of Financial
Accounting Standards No. 123(R), Share-Based Payment.



(signed) KPMG LLP



Syracuse, New York
March 17, 2008




<PAGE>



                           PAR TECHNOLOGY CORPORATION
                           CONSOLIDATED BALANCE SHEETS
                      (in thousands, except share amounts)

                                                              December 31,
                                                        ----------------------
                                                           2007         2006
                                                        ---------    ---------
Assets
Current assets:
     Cash and cash equivalents ......................   $   4,431    $   4,273
     Accounts receivable-net ........................      43,608       46,791
     Inventories-net ................................      40,319       35,948
     Income tax refunds .............................         521        1,103
     Deferred income taxes ..........................       5,630        4,601
     Other current assets ...........................       3,370        2,737
                                                        ---------    ---------
         Total current assets .......................      97,879       95,453
Property, plant and equipment - net .................       7,669        7,535
Deferred income taxes ...............................         503         --
Goodwill ............................................      26,998       25,734
Intangible assets - net .............................       9,899       10,695
Other assets ........................................       3,570        2,841
                                                        ---------    ---------
           Total Assets .............................   $ 146,518    $ 142,258
                                                        =========    =========
Liabilities and Shareholders' Equity
Current liabilities:
     Current portion of long-term debt ..............   $     772    $     240
     Borrowings under lines of credit ...............       2,500        7,713
     Accounts payable ...............................      16,978       12,470
     Accrued salaries and benefits ..................       9,919        8,279
     Accrued expenses ...............................       3,860        1,861
     Customer deposits ..............................       3,898        3,656
     Deferred service revenue .......................      14,357       12,254
                                                        ---------    ---------
         Total current liabilities ..................      52,284       46,473
                                                        ---------    ---------
Long-term debt ......................................       6,932        7,708
                                                        ---------    ---------
Deferred income taxes ...............................        --            115
                                                        ---------    ---------
Other long-term liabilities .........................       2,315        1,879
                                                        ---------    ---------
Shareholders' Equity:
     Preferred stock, $.02 par value,
       1,000,000 shares authorized ..................        --           --
     Common stock, $.02 par value,
       29,000,000 shares authorized;
       16,047,818 and 15,980,486 shares issued;
        14,395,063 and 14,327,731 outstanding .......         321          320
     Capital in excess of par value .................      39,252       38,602
     Retained earnings ..............................      50,451       53,159
     Accumulated other comprehensive income (loss) ..         472         (489)
     Treasury stock, at cost, 1,652,755 shares ......      (5,509)      (5,509)
                                                        ---------    ---------
         Total shareholders' equity .................      84,987       86,083
                                                        ---------    ---------
           Total Liabilities and Shareholders' Equity   $ 146,518    $ 142,258
                                                        =========    =========



See accompanying notes to consolidated financial statements
<PAGE>
<TABLE>
<CAPTION>


                           PAR TECHNOLOGY CORPORATION
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                    (in thousands, except per share amounts)

                                                              Year ended December 31,
                                                      -----------------------------------
                                                         2007        2006          2005
                                                      ---------    ---------    ---------
<S>                                                   <C>          <C>          <C>
Net revenues:
     Product ......................................   $  77,116    $  83,237    $  91,130
     Service ......................................      67,370       61,979       58,327
     Contract .....................................      64,998       63,451       56,182
                                                      ---------    ---------    ---------
                                                        209,484      208,667      205,639
                                                      ---------    ---------    ---------
Costs of sales:
     Product ......................................      45,635       47,925       53,443
     Service ......................................      51,078       46,338       44,205
     Contract .....................................      60,863       58,895       52,405
                                                      ---------    ---------    ---------
                                                        157,576      153,158      150,053
                                                      ---------    ---------    ---------

           Gross margin ...........................      51,908       55,509       55,586
                                                      ---------    ---------    ---------
Operating expenses:
     Selling, general and administrative ..........      37,517       33,440       30,867
     Research and development .....................      17,155       11,802        9,355
     Amortization of identifiable intangible assets       1,572        1,283        1,030
                                                      ---------    ---------    ---------
                                                         56,244       46,525       41,252
                                                      ---------    ---------    ---------
Operating income (loss) ...........................      (4,336)       8,984       14,334
Other income, net .................................       1,227          617          743
Interest expense ..................................      (1,096)        (734)        (287)
                                                      ---------    ---------    ---------

Income (loss) before provision for income taxes ...      (4,205)       8,867       14,790
Benefit (provision) for income taxes ..............       1,497       (3,146)      (5,358)
                                                      ---------    ---------    ---------
Net income (loss) .................................   $  (2,708)   $   5,721    $   9,432
                                                      =========    =========    =========

Earnings (loss) per share
     Basic ........................................   $    (.19)   $     .40    $     .68
     Diluted ......................................   $    (.19)   $     .39    $     .64

Weighted average shares outstanding
     Basic ........................................      14,345       14,193       13,792
                                                      =========    =========    =========
     Diluted ......................................      14,345       14,752       14,648
                                                      =========    =========    =========




See accompanying notes to consolidated financial statements
<CAPTION>


                           PAR TECHNOLOGY CORPORATION
             CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
                                 (in thousands)



                                                              Year ended December 31,
                                                      -----------------------------------
                                                         2007        2006          2005
                                                      ---------    ---------    ---------
<S>                                                   <C>          <C>          <C>

Net income (loss) .................................   $  (2,708)   $   5,721    $   9,432
Other comprehensive income (loss), net of tax:
     Foreign currency translation adjustments               961          122         (430)
                                                      ---------    ---------    ---------
Commprehensive income (loss) .......................  $  (1,747)   $   5,843    $   9,002
                                                      =========    =========    =========
</TABLE>


See accompanying notes to consolidated financial statements


<PAGE>
<TABLE>
<CAPTION>


                           PAR TECHNOLOGY CORPORATION
           CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

                                                                                     Accumulated
                                                            Capital in                  Other                              Total
                                         Common Stock        excess of    Retained    Comprehensive  Treasury Stock   Shareholders'
                                         ------------                                                ---------------  -------------
(in thousands)                      Shares        Amount     Par Value    Earnings   Income (Loss)   Shares    Amount     Equity
                                    ------        ------     ---------    --------   ------------    ------    ------     ------
<S>                                   <C>       <C>          <C>         <C>         <C>              <C>     <C>        <C>
Balances at
   December 31, 2004                  15,209    $   304      $  31,459   $  38,010   $      (181)     (1,806) $ (6,018)  $  63,574
Net income                                                                   9,432                                           9,432
Issuance of common stock upon the
  exercise of stock options,
  net of tax benefit of $3,545           706         14          5,360                                                       5,374
Issuance of treasury stock for
  business acquisition                                             452                                    28        90         542
Translation adjustments, net of tax
  benefit of $263                                                                           (430)                             (430)
                                    --------    -------      ---------   ---------   -----------   ---------  --------   ---------
Balances at
   December 31, 2005                  15,915        318         37,271      47,442          (611)     (1,778)   (5,928)     78,492

Net income                                                                   5,721                                           5,721
Issuance of common stock upon the
  exercise of stock options,
  net of tax benefit of $173              47          2            350                                                         352
Issuance of treasury stock for
    business acquisition                                           647                                   125       419       1,066
Issuance of restricted stock awards       18
Cash in lieu of fractional shares on
  stock split                                                                   (4)                                             (4)
Equity based compensation                                          334                                                         334
Translation adjustments, net of tax
  benefit of $86                                                                             122                               122
                                    --------    -------      ---------   ---------   -----------   ---------  --------   ---------
Balances at
   December 31, 2006                  15,980        320         38,602      53,159          (489)     (1,653)   (5,509)     86,083

Net loss                                                                    (2,708)                                         (2,708)
Issuance of common stock upon the
  exercise of stock options               58          1            202                                                         203
Issuance of restricted stock awards       10
Equity based compensation                                          448                                                         448
Translation adjustments, net of tax
  benefit of $564                                                                            961                               961
                                    --------    -------      ---------   ---------   -----------   ---------  --------   ---------
Balances at
   December 31, 2007                  16,048    $   321      $  39,252   $  50,451   $       472      (1,653) $ (5,509)  $  84,987
                                    ========    =======      =========   =========   ===========   =========  =========  =========

</TABLE>





See accompanying notes to consolidated financial statements

<TABLE>
<CAPTION>
<PAGE>


                           PAR TECHNOLOGY CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                                                               Year ended December 31,
                                                                ------------------------------------------------
                                                                     2007             2006              2005
                                                                -------------     -------------    -------------
<S>                                                             <C>               <C>                   <C>
  Cash flows from operating activities:
   Net income (loss)                                            $      (2,708)    $       5,721         $  9,432
   Adjustments to reconcile net income (loss) to net
     cash provided by (used in) operating activities:
      Depreciation and amortization                                     4,079             3,884            3,755
      Provision for bad debts                                           3,034               849            1,063
      Provision for obsolete inventory                                  3,001             1,922            3,942
      Equity based compensation                                           448               334               --
      Excess tax benefit of stock option exercises                         --                --            3,545
      Deferred income tax                                              (2,211)              916            1,213
   Changes in operating assets and liabilities:
        Accounts receivable                                               149            (6,846)          (9,101)
        Inventories                                                    (7,372)           (8,308)          (6,419)
        Income tax refunds                                                582              (224)            (879)
        Other current assets                                             (633)             (139)             132
        Other assets                                                     (729)             (754)            (756)
        Accounts payable                                                4,603              (496)           2,704
        Accrued salaries and benefits                                   1,640            (1,446)           1,653
        Accrued expenses                                                1,999              (491)            (831)
        Customer deposits                                                 242              (317)            (888)
        Deferred service revenue                                        2,103               813            2,249
        Other long-term liabilities                                       436             1,032              847
                                                                -------------     -------------    -------------
         Net cash provided by (used in) continuing
          operating activities                                          8,663            (3,550)          11,661
         Net cash used in discontinued operations                          --                --             (174)
                                                                -------------     -------------    -------------
         Net cash provided by (used in)
          operating activities                                          8,663            (3,550)          11,487
                                                                -------------      ------------    -------------
  Cash flows from investing activities:
   Capital expenditures                                                (2,017)           (1,189)          (1,682)
   Capitalization of software costs                                    (1,158)             (822)            (617)
   Contingent purchase price paid on
    prior year acquisition                                               (278)               --               --
   Business acquisitions, net of cash acquired                             --            (5,827)          (7,223)
                                                                -------------      ------------    -------------
  Net cash used in investing activities                                (3,453)           (7,838)          (9,522)
                                                                -------------      ------------    -------------
</TABLE>


<PAGE>
<TABLE>
<CAPTION>


                           PAR TECHNOLOGY CORPORATION
                CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
                                 (in thousands)
                                                                               Year ended December 31,
                                                                ------------------------------------------------
                                                                     2007             2006              2005
                                                                -------------     -------------    -------------
<S>                                                             <C>               <C>              <C>
  Cash flows from financing activities:
   Net borrowings (payments) under
     line-of-credit agreements                                         (5,213)            4,213           (6,746)
   Proceeds from long-term debt                                            --             6,000               --
   Payments of long-term debt                                            (244)              (76)             (71)
   Proceeds from the exercise of stock options                            203               179            1,830
   Excess tax benefit of stock option exercises                            --               173               --
   Cash dividend in lieu of fractional shares
     on stock split                                                        --                (4)              --
                                                                -------------     --------------   -------------
         Net cash provided by (used in)
         financing activities                                          (5,254)           10,485           (4,987)
                                                                --------------    -------------    -------------
  Effect of exchange rate changes on cash and
   cash equivalents                                                       202               194             (692)
                                                                -------------     -------------    -------------
  Net increase (decrease) in cash
   and cash equivalents                                                   158              (709)          (3,714)
  Cash and cash equivalents at
   beginning of year                                                    4,273             4,982            8,696
                                                                -------------     -------------    -------------
  Cash and cash equivalents at
   end of year                                                  $       4,431     $       4,273    $       4,982
                                                                =============     =============    =============

  Supplemental disclosures of
   cash flow information:
     Cash paid during the year for:
         Interest                                               $         963     $         687    $         304
         Income taxes, net of refunds                                     104             2,237            1,586

</TABLE>



Supplemental disclosures of non-cash financing and investing activities:

     See non-cash  financing and investing  activities  related to the Company's
business acquisitions as summarized in Note 2.



See accompanying notes to consolidated financial statements

<PAGE>



                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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., PAR Springer-Miller
Systems,  Inc.,  PixelPoint ULC, Par-Siva  Corporation,  PAR Government  Systems
Corporation,   Rome  Research   Corporation,   and  Ausable  Solutions,   Inc.),
collectively  referred  to  as  the  "Company."  All  significant   intercompany
transactions have been eliminated in consolidation.

Revenue recognition

     The Company recognizes  revenue generated by the Hospitality  segment using
the  guidance  from SEC  Staff  Accounting  Bulletin  (SAB)  No.  104,  "Revenue
Recognition" and the AICPA Statement of Position (SOP) 97-2,  "Software  Revenue
Recognition".  Product  revenues  consist  of  sales of the  Company's  standard
point-of-sale  and  property  management  systems  of the  Hospitality  segment.
Product  revenues  include both  hardware and software  sales.  The Company also
records service  revenues  relating to its standard  point-of-sale  and property
management systems of the Hospitality segment.

     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) as
under SAB No. 104, persuasive  evidence of an arrangement  exists,  delivery has
occurred,  the price is fixed or determinable,  and collectibility is reasonably
assured.

     Software

     Revenue recognition on software sales generally occurs upon delivery to the
customer  site (or when  shipped  for  systems  that  are not  installed  by the
Company)  as under SOP  97-2,  persuasive  evidence  of an  arrangement  exists,
delivery has occurred, the price is fixed or determinable, and collectibility is
reasonably assured.  For software sales 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.
<PAGE>

     Service

     Service revenue  consists of installation  and training  services,  support
maintenance,  and field and depot  repair.  Installation  and  training  service
revenue are based upon standard  hourly/daily rates 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 recognized ratably over the underlying contract period.

     The  individual   product  and  service  offerings  that  are  included  in
arrangements  with our customers  are  identified  and priced  separately to the
customer based upon the stand alone price for each individual product or service
sold in the arrangement irrespective of the combination of products and services
which are included in a particular arrangement. As such, the units of accounting
are based on each individual  product and service sold, and revenue is allocated
to each  element  based on vendor  specific  objective  evidence  (VSOE) of fair
value.  VSOE of fair value for each  individual  product and service is based on
separate individual prices of these products and services.  The sales price used
to  establish  fair  value is the  sales  price of the  element  when it is sold
individually  in a  separate  arrangement  and not as a  separate  element  in a
multiple element arrangement.

     Contracts

     The Company recognizes revenue in its Government segment using the guidance
from SEC Staff Accounting Bulletin No. 104, Revenue  Recognition.  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  for  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.
<PAGE>

Statement of cash flows

     For  purposes of reporting  cash flows,  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.

 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 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 consist of cash surrender  value of life insurance  related to
the Company's Deferred Compensation Plan.

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.
<PAGE>

Other long-term liabilities

     Other long-term liabilities represent amounts owed to certain employees who
are participants in the Company's Deferred Compensation Plan.

 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 a long-term  investment
nature  are also  recorded  as a  translation  adjustment  and are  included  in
Accumulated  Other  Comprehensive  Income (Loss).  Foreign currency  transaction
gains and losses are recorded in other income in the accompanying  statements of
operations.

Other income

     The  components of other income for the three years ending  December 31 are
as follows:

                                                     Year ended December 31,
                                                         (in thousands)
                                             -----------------------------------
                                               2007           2006         2005
                                             --------      ---------     -------

Foreign currency gains ...............        $  605        $   76        $  186
Rental income-net ....................           444           320           320
Other ................................           178           221           237
                                              ------        ------        ------
                                              $1,227        $  617        $  743
                                              ======        ======        ======


Identifiable intangible assets

     The  Company  capitalizes  certain  costs  related  to the  development  of
computer  software used in its  Hospitality  segment under the  requirements  of
Statement of Financial  Accounting  Standards (SFAS) No. 86,  Accounting for the
Costs of Computer Software to be Sold, Leased, or Otherwise  Marketed.  Software
development costs incurred prior to establishing  technological  feasibility are
charged to operations and included in research and development  costs.  Software
<PAGE>


development  costs incurred after  establishing  feasibility are capitalized and
amortized  on a  product-by-product  basis  when the  product is  available  for
general release to customers. Annual amortization,  charged to cost of sales, is
computed using the straight-line  method over the remaining  estimated  economic
life of the product, generally three years. Amortization of capitalized software
costs  amounted to  $624,000,  $680,000 and  $834,000 in 2007,  2006,  and 2005,
respectively.

     The Company acquired identifiable  intangible assets in connection with its
acquisitions  in 2006, 2005 and 2004.  Amortization  of identifiable  intangible
assets  amounted to  $1,572,000 in 2007,  $1,283,000  in 2006 and  $1,030,000 in
2005. See Note 2 for additional details.

     The components of identifiable intangible assets are:

                                                      Year ended December 31,
                                                           (in thousands)
                                                    ----------------------------
                                                       2007              2006
                                                    ----------       -----------

Software costs .............................         $  7,475          $  6,363
Customer relationships .....................            4,506             4,393
Trademarks (non-amortizable) ...............            2,758             2,694
Other ......................................              613               578
                                                     --------          --------
                                                       15,352            14,028
Less accumulated amortization ..............           (5,453)           (3,333)
                                                     --------          --------
                                                     $  9,899          $ 10,695
                                                     ========          ========

     The  future  amortization  of these  intangible  assets is as  follows  (in
thousands):

                      2008                       $  2,296
                      2009                          2,036
                      2010                          1,450
                      2011                            927
                      2012                            427
                      Thereafter                        5
                                                 --------
                                                 $  7,141
                                                 ========

     The Company has elected to test for impairment of  identifiable  intangible
assets during the fourth quarter of its fiscal year.  There was no impairment of
identifiable intangible assets in 2007, 2006 and 2005.

<PAGE>


Stock split

     On November 14, 2005, the Company's  Board of Directors  declared a 3 for 2
stock split in the form of a stock  dividend that was  distributed on January 6,
2006 to  shareholders  of record on December 12,  2005.  All share and per share
data  in  these  consolidated  financial  statements  and  footnotes  have  been
retroactively  restated  as if the stock split had  occurred as of the  earliest
period presented.

Stock-based compensation

     Effective  January 1, 2006, the Company adopted the fair value  recognition
provisions of Statement of Financial  Accounting  Standards No. 123R Share-Based
Payment (SFAS 123R) on a modified  prospective basis. This standard requires the
Company to measure the cost of employee services received in exchange for equity
awards based on the grant date fair value of the awards.  The cost is recognized
as  compensation   expense  over  the  vesting  period  of  the  awards.   Total
compensation  expense  included  in  operating  expenses  for  2007 and 2006 was
$448,000 and $334,000,  respectively.  Prior to adopting SFAS 123R on January 1,
2006, the Company's equity based employee compensation awards were accounted for
under  the  recognition  and  measurement  principles  of APB  Opinion  No.  25,
Accounting for Stock Issued to Employees, and related interpretations.

 Earnings per share

     Earnings per share are calculated in accordance with Statement of Financial
Accounting   Standards  No.  128  Earnings  per  Share,   which   specifies  the
computation,  presentation,  and disclosure  requirements for earnings per share
(EPS). It requires the presentation of basic and diluted EPS. Basic EPS excludes
all  dilution  and is based upon the weighted  average  number of common  shares
outstanding during the period.  Diluted EPS reflects the potential dilution that
would  occur  if  securities  or other  contracts  to issue  common  stock  were
exercised or converted into common stock.

<PAGE>

     The  following  is  a   reconciliation   of  the  weighted  average  shares
outstanding  for the basic and diluted EPS  computations  (in thousands,  except
share and per share data):

<TABLE>
<CAPTION>

                                                       2007        2006      2005
                                                    --------    --------   ---------

<S>                                                 <C>         <C>        <C>
Net income (loss) ...............................   $ (2,708)   $  5,721   $  9,432
                                                    ========    ========   ========
Basic:
     Shares outstanding at beginning of year ....     14,328      14,137     13,403
     Less unvested restricted stock .............        (18)       --         --
     Weighted shares issued during the year .....         35          56        389
                                                    --------    --------   --------
     Weighted average common shares, basic ......     14,345      14,193     13,792
                                                    ========    ========   ========
          Earnings (loss) per common share, basic   $   (.19)   $    .40   $    .68
                                                    ========    ========   ========
Diluted:
     Weighted average common shares, basic ......     14,345      14,193     13,792
     Dilutive impact of stock options ...........       --           557        856
     Dilutive impact of restricted stock awards .       --             2       --
                                                    --------    --------   --------

     Weighted average common shares, diluted ....     14,345      14,752     14,648
                                                    ========    ========   ========
     Earnings (loss) per common share, diluted ..   $   (.19)   $    .39   $    .64
                                                    ========    ========   ========
</TABLE>

     For the year ended December 31, 2007,  436,000 of  incremental  shares from
the assumed exercise of stock options and 22,749 restricted stock awards are not
included  in the  computation  of  diluted  earnings  per share  because  of the
anti-dilutive  effect on earnings per share.  At December  31, 2006,  there were
70,500  anti-dilutive  stock  options  outstanding  and no  anti-dilutive  stock
outstanding stock options in 2005.


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:  the
carrying amount of property, plant and equipment, identifiable intangible assets
and goodwill,  valuation  allowances for  receivables,  inventories and deferred
income tax assets. Actual results could differ from those estimates.
<PAGE>
Goodwill

     Goodwill  represents the excess of the cost of an acquired  entity over the
net  of the  amounts  assigned  to  assets  acquired  and  liabilities  assumed.
Following  Financial   Accounting  Standards  Board  issuance  of  Statement  of
Financial  Accounting  Standards  (SFAS) No. 142 Goodwill  and Other  Intangible
Assets,  the  Company  tests  all  goodwill  for  impairment  annually,  or more
frequently if circumstances indicate potential impairment,  through a comparison
of fair value to its carrying  amount.  The Company has elected to annually test
for impairment in the fourth quarter of its fiscal year. There was no impairment
of goodwill in 2007, 2006 or 2005.

     The following  table  reflects the changes in goodwill  during the year (in
thousands):

                                                 Year ended December 31,
                                                 -----------------------
                                              2007       2006         2005
                                           ---------   --------    --------

Balance at beginning of year ............   $ 25,734   $ 20,622    $ 15,379
Acquisition of businesses during the year       --        4,843       6,075
Purchase accounting adjustment related to
  prior year acquisition ................         27        (15)       (820)
Contingent purchase price earned on prior
  year acquisitions .....................        156        278         --
Change in foreign exchange rates during
  the period ............................      1,081          6         (12)
                                            --------   --------    --------
Balance at end of year ..................   $ 26,998   $ 25,734    $ 20,622
                                            ========   ========    ========

Accounting for impairment or disposal of long-lived assets

     In accordance with SFAS 144,  "Accounting for the Impairment or Disposal of
Long-Lived  Assets," we evaluate the accounting and reporting for the impairment
of long-lived assets and for long-lived assets to be disposed. SFAS 144 requires
recognition  of 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 dispose for assets to
be disposed. No impairment was identified during 2007, 2006 or 2005.
<PAGE>

Reclassifications

     Amounts in prior years' consolidated  financial statements are reclassified
whenever necessary to conform with the current year's presentation.

New accounting pronouncements

     Financial Accounting Standards Board (FASB) Interpretation 48 was issued in
July 2006 to  clarify  the  criteria  for  recognizing  tax  benefits  under FAS
Statement No. 109,  Accounting for Income taxes. The Interpretation  defines the
threshold for recognizing the benefits of tax return  positions in the financial
statements as "more-likely-than-not" to be sustained by the taxing authority and
will affect many companies'  reported results and their disclosures of uncertain
tax  positions.  The  Interpretation  does not  prescribe  the type of  evidence
required to support meeting the more-likely-than-not  threshold, stating that it
depends on the individual facts and circumstances.  The benefit recognized for a
tax position meeting the more-likely-than-not criterion is measured based on the
largest  benefit  that is more  than  50  percent  likely  to be  realized.  The
measurement   of  the  related   benefit  is  determined  by   considering   the
probabilities  of the amounts that could be realized upon  ultimate  settlement,
assuming the taxing  authority  has full  knowledge  of all  relevant  facts and
including  expected  negotiated  settlements  with  the  taxing  authority.  The
Company's  policy is to recognize  interest and  penalties on  unrecognized  tax
benefits in interest expense in the consolidated statements of operations.  FASB
Interpretation  48 is  effective  as of the  beginning  of the first fiscal year
beginning after December 15, 2006 (the Company's 2007 fiscal year). This did not
have a material impact on the 2007 consolidated financial statements.

     In September  2006,  the FASB issued SFAS No. 157, Fair Value  Measurements
(SFAS 157),  which provides  guidance for measuring the fair value of assets and
liabilities,   as  well  as  requires  expanded  disclosures  about  fair  value
measurements.  SFAS 157 indicates that fair value should be determined  based on
the  assumptions  marketplace  participants  would use in  pricing  the asset or
liability,  and provides  additional  guidelines to consider in determining  the
market-based  measurement.  The  Company  will be  required to adopt SFAS 157 on
January 1, 2008. The Company is currently evaluating the impact of adopting SFAS
157 on its consolidated financial statements.

     In February  2007,  the FASB issued SFAS No. 159, The Fair Value Option for
Financial  Assets and  Financial  Liabilities  (SFAS 159).  SFAS 159 permits all
entities to choose to measure eligible items at fair value at specified election

<PAGE>

dates.  SFAS 159 is  effective as of the  beginning of an entity's  first fiscal
year that begins after November 15, 2007. The Company is currently assessing the
impact of adopting SFAS 159 on its consolidated financial statements.

     In December  2007,  the FASB issued SFAS No.141  (revised  2007),  Business
Combinations  (SFAS  141(R)).  The objective of this Statement is to improve the
relevance,  representational  faithfulness, and comparability of the information
that a reporting  entity  provides  in its  financial  reports  about a business
combination.  Specifically,  it establishes principles and requirements over how
the acquirer (1) recognizes and measures the identifiable  assets acquired,  the
liabilities  assumed,  and any  noncontrolling  interest  in the  acquiree;  (2)
recognizes and measures goodwill acquired in the business  combination or a gain
from a bargain  purchase,  and; (3) determines  what  information to disclose to
enable users of the  financial  statements  to evaluate the nature and financial
effects of the business  combination.  This  Statement  is effective  for fiscal
years  beginning  after  December 15, 2008  (fiscal  year 2009).  The Company is
currently  assessing  the impact of  adopting  SFAS  141(R) on its  consolidated
financial statements.

     In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in
Consolidated  Financial  Statements  an amendment of ARB No. 51 (SFAS 160).  The
objective of this  Statement  is to improve the  relevance,  comparability,  and
transparency of the financial  information  that a reporting  entity provides in
its consolidated  financial statements by establishing  accounting and reporting
standards for the noncontrolling  interest in a subsidiary  (minority interests)
and for the  deconsolidation  of a subsidiary.  This  Statement is effective for
fiscal years,  and interim  periods within those fiscal years,  beginning  after
December  15, 2008 (fiscal year 2009).  The Company is currently  assessing  the
impact of adopting this SFAS 160 on its consolidated financial statements.

Note 2 -- Business Acquisitions

     On November 2, 2006, PAR  Technology  Corporation  (the  "Company") and its
wholly  owned  subsidiary,   Par-Siva  Corporation  (f/k/a  PAR  Vision  Systems
Corporation)  (the  "Subsidiary")  acquired  substantially all of the assets and
assumed certain liabilities of SIVA Corporation ("SIVA").  The purchase price of
the assets was approximately $6.9 million including estimated acquisition costs

<PAGE>

of approximately $204,000. The purchase price consisted of $1.1 million worth of
PAR common stock  (125,549  shares of PAR  Technology  Corporation  common stock
issued out of treasury)  and the remainder in cash.  The agreement  provides for
additional  contingent  purchase  price  payments  based on certain  sales based
milestones  and  other  conditions.  In 2007,  there was no  contingent  payment
earned.  SIVA,  based in Delray  Beach,  Florida,  is a  developer  of  software
solutions for multi-unit restaurant operations.

     On October 4, 2005, the Company and its newly formed, wholly-owned Canadian
subsidiary,   PixelPoint,   ULC  (the  Canadian  Subsidiary),   completed  their
acquisition of PixelPoint Technologies,  Inc. (PixelPoint) pursuant to which the
Canadian Subsidiary acquired all of the stock of PixelPoint.  The purchase price
was $7.5  million and  consisted  of $542,000 in Company  common  stock  (27,210
shares of PAR  Technology  Corporation  common  stock  issued out of treasury) a
promissory  note for  $671,000  and the  remainder  in cash.  The  Company  also
incurred  $344,000 in direct  acquisition  costs relating to this purchase.  The
purchase price is also subject to price  contingencies based upon future revenue
performance against certain established  targets. In 2007 and 2006, $103,000 and
$218,000,  respectively,  was  earned  based on  achievement  of these  targets.
Located  in  suburban  Toronto,  Ontario,  PixelPoint  Technologies,  Inc.  is a
supplier of hospitality solutions to full-service restaurants around the globe.

     On December 6, 2005, the Company also acquired C(3)I Associates  (C(3)I), a
Government  technology services business.  The Company paid $589,000 in cash and
assumed  certain  liabilities.  The  purchase  price  is also  subject  to price
contingencies  based upon future revenue performance against certain established
targets. In 2007 and 2006, $53,000 and $60,000,  respectively,  was earned based
on achievement of these targets.

     The total  purchase price for each of these  acquisitions  was allocated to
the tangible and identifiable intangible assets acquired and liabilities assumed
by the Company based on their estimated fair values as of the respective

<PAGE>

closing date of the acquisitions. Identifiable intangible assets recorded in the
acquisitions are tested for impairment in accordance with the provisions of SFAS
142.  The  following  table  presents  the  estimated  fair  value of the assets
acquired and liabilities assumed at the date of acquisition:

                                               2006                2005
                                             --------   -----------------------
           (in thousands)                      SIVA      PixelPoint      C(3)I
            ------------                     --------   -----------    --------

Cash and cash equivalents .............       $ --         $   32       $   --
Other current assets ..................           13          185            8
Property, plant and equipment .........          223          122           --
Other assets ..........................         --            671           --
Intangible assets .....................        1,924        1,634          290
Goodwill ..............................        4,843        5,539          536
                                              ------       ------       ------
Total assets acquired .................       $7,003       $8,183          834
                                              ======       ======       ======

Deferred revenues and customer deposits          110           --           --
Other current liabilities .............           --          303          245
 Long-term liabilities ................           --           --           --
                                              ------       ------       ------
Total liabilities assumed .............          110          303          245
                                              ------       ------       ------
Purchase price, including
  acquisition related costs ...........       $6,893       $7,880       $  589
                                              ======       ======       ======


     The  identifiable  intangible  assets acquired and their  estimated  useful
lives (based on third party valuation) are as follows:

   (in thousands)             SIVA       PixelPoint       C(3)I     Useful Life
    ------------            ---------     ----------   ----------   ------------

Software costs .......       $1,025       $  258       $     --      5 Years

Customer relationships          649          774            270      5 - 7 Years

Trademarks ...........          250          344             --      Indefinite

Others ...............           --          258             20      3 - 7 Years
                             ------       ------       -------
                             $1,924       $1,634       $   290
                             ======       ======       =======
<PAGE>


     On an unaudited  proforma basis,  assuming the completed  acquisitions  had
occurred as of the beginning of the periods presented,  the consolidated results
of the  Company  would  have been as  follows  (in  thousands,  except per share
amounts):

                                                 Year ended December 31,
                                         ------------------------------------
                                              2006                   2005
                                         -------------          -------------

Revenues                                 $     209,723          $     209,515
                                         =============          =============
Net income                               $       2,743          $       6,139
                                         =============          =============
Earnings per share:
     Basic                               $         .19          $         .44
                                         =============          =============
     Diluted                             $         .18          $         .41
                                         =============          =============

     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  been
combined for the periods presented.

Note 3 -- Accounts Receivable

     The Company's net accounts receivable consist of:

                                       December 31,
                                       (in thousands)
                                -------------------------
                                  2007             2006
                                --------        ---------
Government segment:
     Billed .............       $ 13,153        $  9,076
     Advanced billings ..         (2,687)         (1,465)
                                --------        --------
                                  10,466           7,611
                                --------        --------
Hospitality segment:
Accounts receivable - net         33,142          39,180
                                --------        --------
                                $ 43,608        $ 46,791
                                ========        ========

     At December 31, 2007,  2006 and 2005,  the Company had recorded  allowances
for doubtful accounts of $2,447,000,  $1,850,000, and $1,748,000,  respectively,
against  Hospitality  accounts  receivable.  Write-offs  of accounts  receivable
during  fiscal  years  2007,  2006  and  2005  were  $2,437,000,   $747,000  and
$1,614,000,  respectively.  The provision for doubtful  accounts recorded in the
consolidated statements of operations was $3,034,000, $849,000 and $1,063,000 in
2007, 2006 and 2005, respectively.
<PAGE>

Note 4 -- Inventories

         Inventories are used primarily in the manufacture, maintenance, and
service of Hospitality systems. Inventories are net of related reserves. The
components of inventories-net are:
                                           December 31,
                                          (in thousands)
                                   -------------------------
                                     2007              2006
                                   --------         --------

          Finished goods           $ 9,965          $ 9,533
          Work in process            1,722            1,667
          Component parts           10,408            7,119
          Service parts .           18,224           17,629
                                   -------          -------
                                   $40,319          $35,948
                                   =======          =======

     The  Company  records  reserves  for  shrinkage  and  excess  and  obsolete
inventory.  At December 31, 2007, 2006 and 2005,  these amounts were $3,951,000,
$3,658,000, and 4,189,000, respectively. Write-offs of inventories during fiscal
years  2007,  2006  and  2005  were   $2,708,000,   $2,453,000  and  $3,735,000,
respectively.  The provision  for  shrinkage  and excess and obsolete  inventory
recorded in the consolidated statements of operations was $3,001,000, $1,922,000
and $3,942,000 in 2007, 2006 and 2005, respectively.

Note 5 -- Property, Plant and Equipment

         The components of property, plant and equipment are:

                                                          December 31,
                                                         (in thousands)
                                                -----------------------------
                                                   2007               2006
                                                ----------          ---------

          Land ........................          $    253           $    253
          Buildings and improvements ..             5,895              5,669
          Rental property .............             5,490              5,490
          Furniture and equipment .....            20,215             18,264
                                                 --------           --------
                                                   31,853             29,676
          Less accumulated depreciation
           and amortization ...........           (24,184)           (22,141)
                                                 --------           --------
                                                 $  7,669           $  7,535
                                                 ========           ========

     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 ranges from three to eight years.  Depreciation  expense
recorded was  $1,882,000,  $1,921,000 and  $1,883,000  for 2007,  2006 and 2005,
respectively.

     The  Company  leases a portion  of its  headquarters  facility  to  various
tenants.  Rent received from these leases  totaled  $1,132,000,  $1,129,000  and
$1,038,000 for 2007, 2006 and 2005, respectively.
<PAGE>

     Future  minimum  rent  payments  due  to  the  Company  under  these  lease
arrangements are as follows (in thousands):

                        2008                    $     917
                        2009                          354
                        2010                          242
                        2011                          182
                                                ---------
                                                $   1,695
                                                =========

     The Company  leases office space under  various  operating  leases.  Rental
expense on these operating leases was approximately  $2,706,000,  $2,559,000 and
$2,138,000 for 2007, 2006, and 2005, respectively.

     Future minimum lease payments under all noncancelable  operating leases are
(in thousands):

                         2008                   $   2,382
                         2009                       1,793
                         2010                       1,024
                         2011                         716
                         2012                         575
                         Thereafter                 1,789
                                                ---------
                                                $   8,279
                                                =========

Note 6 -- Debt

     The Company has an aggregate  availability of $20,000,000 in unsecured bank
lines of  credit.  One line  totaling  $12,500,000  bears  interest  at the bank
borrowing  rate  (6.75% at December  31,  2007).  The second line of  $7,500,000
allows 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 (6.85% at
December 31, 2007). These facilities contains certain loan covenants including a
leverage ratio of not greater than 3:5 to 1 and a fixed charge coverage ratio of
not less than 4 to 1. In June 2007,  these  credit  agreements  were  amended to
waive the existing  leverage and fixed charge  coverage ratios for the remainder
of 2007. Under the amendment,  the Company was required to meet a minimum EBITDA
requirement  for the balance of 2007. In the fourth quarter of 2007, the Company
<PAGE>


did not attain the required EBITDA covenant but received  waivers from its banks
from this requirement.  In addition,  in January and February 2008, these credit
agreements  were amended to modify the  requirement for leverage ratio and fixed
charge  coverage  ratios  through June of 2008.  The original  covenants  become
effective for the quarter ended September 30, 2008 and  thereafter.  These lines
expire in April 2009. At December 31, 2007 and 2006,  there was  $2,500,000  and
$7,713,000  outstanding  under these lines,  respectively.  The weighted average
interest rate paid by the Company during 2007 and 2006 was 6.6%.

     In 2006,  the Company  borrowed  $6,000,000  under an  unsecured  term loan
agreement with a bank in connection  with the  acquisition of SIVA  Corporation.
The loan provides for interest  only  payments in the first year and  escalating
principal  payments through 2012. The loan bears interest at the LIBOR rate plus
the applicable interest rate spread (7.25% at December 31, 2007).

     In September 2007, the Company entered into an interest rate swap agreement
associated  with a $6,000,000  variable  rate loan with  principal  and interest
payments due through August 2012. At December 31, 2007,  the notional  principal
amount  totaled  $5,850,000.  This  instrument  was  utilized  by the Company to
minimize significant unplanned fluctuations in earnings and cash flows caused by
interest rate  volatility.  The Company did not adopt hedge accounting under the
provision of FASB Statement No 133,  Accounting for Derivative  Instruments  and
Hedging Activities, but rather records the fair market value adjustments through
the consolidated statements of operations each period. The associated fair value
adjustment  included  within the  consolidated  statements of operations for the
year ended  December  31,  2007 was  $154,000  and is included as an increase to
interest expense.

     The  Company  has a  $1,854,000  mortgage  collateralized  by certain  real
estate.  The annual mortgage payment  including  interest totals  $226,000.  The
mortgage bears interest at a fixed rate of 7% and matures in 2010.

<PAGE>
     The Company's  future  principal  payments under its term loan and mortgage
are as follows (in thousands):

                       2008               $    772
                       2009                  1,079
                       2010                  2,928
                       2011                  1,575
                       2012                  1,350
                                           -------
                                           $ 7,704
                                           =======

Note 7 -- Stock based compensation

     Effective  January 1, 2006, the Company adopted the fair value  recognition
provisions of Statement of Financial  Accounting  Standards No. 123R Share-Based
Payment (SFAS 123R) on a modified  prospective basis. This standard requires the
Company to measure the cost of employee services received in exchange for equity
awards based on the grant date fair value of the awards.  The cost is recognized
as compensation expense over the vesting period of the awards. Total stock-based
compensation expense included in selling, general and administrative expense for
the  year  ended   December  31,  2007  and  2006  was  $448,000  and  $334,000,
respectively.  This  amount  includes  $78,000  and  $20,000  in 2007 and  2006,
respectively,  relating to restricted stock awards. No compensation  expense has
been capitalized during fiscal years 2007 and 2006.

     Prior to adopting SFAS 123R on January 1, 2006, the Company's  equity based
employee  compensation  awards  were  accounted  for under the  recognition  and
measurement  principles  of APB Opinion No. 25,  Accounting  for Stock Issued to
Employees, and related interpretations. For the year ended December 31, 2005, no
equity option based employee  compensation  cost is reflected in net income,  as
all options granted under the Company's stock option plans had an exercise price

<PAGE>


equal to the underlying  common stock price on the date of grant.  The following
table  illustrates  the effect on net income  and  earnings  per share as if the
Company  had  applied  the fair value  recognition  provisions  to equity  based
employee compensation (in thousands, except per share data):

                                                           2005
                                                           ----

          Net income                                    $   9,432
          Compensation expense, net of tax                   (410)
                                                        ---------
          Proforma net income                           $   9,022
                                                        =========

     Earnings per share:
          As reported      -- Basic                     $     .68
                           -- Diluted                   $     .64

          Proforma         -- Basic                     $     .65
                           -- Diluted                   $     .62

     In 2005,  the  Company's  1995 Stock Option plan  expired.  The 2005 Equity
Incentive  Plan was approved by the  shareholders  at the Company's  2006 Annual
Meeting.  The  Company  has  reserved  1,000,000  shares  under its 2005  Equity
Incentive Plan.  Stock options under this Plan may be incentive stock options or
nonqualified stock options.  The Plan also provides for restricted stock 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.

     Information with respect to this plan is as follows:

                                                                     Aggregate
                                 No. of Shares Weighted Average  Intrinsic Value
                                 (in thousands) Exercise Price    (in thousands)
                                 ------------- ----------------   --------------

Outstanding at December 31, 2006 .    1,139        $   4.62           $5,012
           Options granted .......       51            9.77
           Exercised .............      (58)           3.51
           Forfeited and cancelled      (49)           8.47
                                      -----         -------

Outstanding at December 31, 2007 .    1,083        $   4.75           $3,206
                                      =====        ========           ======
Vested and expected to vest
     at December 31, 2007 ........    1,067        $   4.68           $3,233
                                      =====        ========           ======
Total shares exercisable
     as of December 31, 2007 .....      837        $   3.58           $3,457
                                      =====        ========           ======
Shares remaining
              available for grant       821
                                      =====

<PAGE>

     The weighted  average grant date fair value of options  granted  during the
years 2007, 2006 and 2005 was $4.39,  $3.69 and $4.78,  respectively.  The total
intrinsic value of options  exercised  during the years ended December 31, 2007,
2006 and 2005 was $289,000,  $670,000 and  $10,310,000,  respectively.  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:

                                                  2007         2006        2005
                                              ----------   ----------    -------

Expected option life ...................       4.5 years    4.5 years    5 years
Weighted average risk-free interest rate       4.7 %        4.6%         3.5%
Weighted average expected volatility ...       48%          50%          43%
Expected dividend yield ................       0%           0%           0%


     For the years ended December 31, 2007,  2006 and 2005, 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, 2007 are summarized as follows:

   Range of        Number Outstanding     Weighted Average      Weighted Average
Exercise Prices      (in thousands)        Remaining Life        Exercise Price
---------------    ------------------     ----------------      ---------------

$1.25  -   $3.17              545            2.9   Years            $  2.21
$3.21  -   $8.47              416            6.8   Years            $  6.31
$9.50  -  $11.40              122            8.0   Years            $ 10.72
----------------          -------            -----------            -------
$1.25  -  $11.40            1,083            5.0   Years            $  4.75
================          =======            ===========            =======

     At  December  31,  2007 the  aggregate  unrecognized  compensation  cost of
unvested  options,  as determined using a Black-Scholes  option valuation model,
was $601,000 (net of estimated  forfeitures)  which is expected to be recognized
as compensation expense in fiscal years 2008 through 2012.

<PAGE>


     Current year activity with respect to the Company's nonvested stock options
is as follows:

                                                                  Weighted
                                                             Average grant-date
          Nonvested shares (in thousands)       Shares           fair value
          -------------------------------      --------      -----------------

          Balance at January 1, 2007 ..           376           $   3.58
                Granted ...............            51               4.39
                Vested ................          (132)              4.54
                Forfeited and cancelled           (49)              3.89
                                                 ----           --------
          Balance at December 31, 2007            246           $   3.97
                                                 ====           ========

     During 2007 and 2006, the Company issued 9,600 and 17,800  restricted stock
awards,  respectively,  at a per share  price of $.02.  These  awards  vest over
various periods ranging from 6 to 60 months.

Note 8-- Income Taxes

     The provision (benefit) for income taxes consists of:

                                              Year ended December 31,
                                                  (in thousands)
                                        ----------------------------------
                                           2007         2006        2005
                                        ---------     --------   ---------
Current income tax:
     Federal .......................     $   206      $ 1,565     $ 3,312
     State .........................          86          346         679
     Foreign .......................         422          319         154
                                         -------      -------     -------
                                             714        2,230       4,145
                                         -------      -------     -------
Deferred income tax:
     Federal .......................      (1,872)         802       1,196
     State .........................        (339)         114          17
                                         -------      -------     -------
                                          (2,211)         916       1,213
                                         -------      -------     -------
Provision (benefit) for income taxes     $(1,497)     $ 3,146     $ 5,358
                                         =======      =======     =======

<PAGE>


     Deferred tax liabilities (assets) are comprised of the following at:

                                                             December 31,
                                                             (in thousands)
                                                     ---------------------------
                                                        2007              2006
                                                     ----------       ----------

     Software development expense ..........          $   778           $   493
     Intangible assets .....................              864               528
     Other .................................              277              --
                                                      -------           -------
     Gross deferred tax liabilities ........            1,919             1,021
                                                      -------           -------

     Allowances for bad debts and inventory            (3,738)           (3,204)
     Capitalized inventory costs ...........             (115)             (105)
     Employee benefit accruals .............           (1,566)           (1,172)
     Federal net operating loss carryforward             (672)             --
     State net operating loss carryforward .             (405)              (81)
     Tax credit carryforwards ..............           (1,345)             (617)
     Other .................................             (211)             (328)
                                                      -------           -------
     Gross deferred tax assets .............           (8,052)           (5,507)
                                                      -------           -------
     Net deferred tax assets ...............          $(6,133)          $(4,486)
                                                      =======           =======


     The Company has Federal tax credit  carryforwards of $1,068,000 that expire
in various tax years from 2013 to 2017. The Company has a Federal operating loss
carryforward  of  $2,218,000  that  expires  in  2027.  Of  the  operating  loss
carryforward,  $241,000  will  result in a  benefit  within  additional  paid in
capital when realized.  The Company also has state tax credit  carryforwards  of
$191,000 and state net operating loss  carryforwards  of $9,439,000 which expire
in various tax years through 2027.  In assessing the  realizability  of 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.  Based upon the historical  level of taxable income and
projections  for future taxable  income,  management  believes it is more likely
than not the  Company  will  realize  the  benefit of the  deferred  tax assets.
Accordingly,  no deferred tax  valuation  allowance was recorded at December 31,
2007 and 2006.

     The Company has adopted the  provisions of Financial  Accounting  Standards
Board  Interpretation No. 48, Accounting for Uncertainty in Income Taxes (FIN48)
effective January 1, 2007. The Company's  adoption of FIN 48 on January 1, 2007,
did not have a material impact on the Company's consolidated financial position,
results of operations or cash flows.
<PAGE>

     The  provision  (benefit)  for income  taxes  differed  from the  provision
computed by applying the Federal  statutory  rate to income  before taxes due to
the following:

                                                Year ended December 31,
                                         ----------------------------------
                                            2007        2006          2005
                                         -------      --------     --------

Federal statutory tax rate ......        (35.0)%       35.0%        34.0%
State taxes .....................         (6.6)         3.9          3.1
Extraterritorial income exclusion           --         (2.4)        (1.4)
Non deductible expenses .........          6.8          1.9           .5
Tax credits .....................         (3.6)        (1.0)         (.6)
Foreign income taxes ............          1.7           --           .5
Other ...........................          1.1         (1.9)          .1
                                          ----         ----         ----
                                         (35.6)%       35.5%        36.2%
                                          ====         ====         ====

Note 9 -- 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 contributed $800,000, $880,000, and $1,985,000 to the
Plan in 2007,  2006,  and 2005,  respectively.  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 $396,000, $348,000 and $297,000 in 2007, 2006, and 2005, 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
$632,000, $707,000 and $1,258,000 in 2007, 2006, and 2005, respectively.

     The Company also sponsors a Deferred  Compensation  Plan for a select group
of highly  compensated  employees  that  includes the  Executive  Officers.  The
Deferred Compensation Plan was adopted effective March 4, 2004. 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 the behalf of
the  participants,  though it did not make any employer  contributions  in 2007,
2006, and 2005.
<PAGE>

Note 10 -- 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.

Note 11 -- Segment and Related Information

     The Company's  reportable  segments are strategic  business units that have
separate management teams and infrastructures  that offer different products and
services.

     The Company has two reportable  segments,  Hospitality and Government.  The
Hospitality  segment offers  integrated  solutions to the hospitality  industry.
These offerings  include  industry  leading  hardware and software  applications
utilized at the point-of-sale,  back of store and corporate office. This segment
also offers customer support including field service, installation,  twenty-four
hour  telephone  support  and depot  repair.  The  Government  segment  provides
technical expertise in the development of advanced technology  prototype systems
primarily  for the U.S.  Department  of  Defense  and  other  U.S.  Governmental
agencies.  It provides  services  for  operating  and  maintaining  certain U.S.
Government-owned  communication and test sites, and for planning,  executing and
evaluating  experiments  involving  new or advanced  radar  systems.  It is also
involved in developing  technology to track mobile chassis.  Intersegment  sales
and transfers are not significant.

<PAGE>

     Information as to the Company's segments is set forth below:

                                            Year ended December 31,
                                                (in thousands)
                                   -------------------------------------------
                                       2007            2006             2005
                                   -----------     -----------     -----------
Revenues:
   Hospitality ...............      $ 144,486       $ 145,216       $ 149,457
   Government ................         64,998          63,451          56,182
                                    ---------       ---------       ---------
           Total .............      $ 209,484       $ 208,667       $ 205,639
                                    =========       =========       =========
Operating income (loss):
   Hospitality ...............      $  (7,701)      $   5,051       $  10,864
   Government ................          3,814           4,267           3,470
   Other .....................           (449)           (334)           --
                                    ---------       ---------       ---------
                                       (4,336)          8,984          14,334
Other income, net ............          1,227             617             743
Interest expense .............         (1,096)           (734)           (287)
                                    ---------       ---------       ---------
Income (loss) before provision
  for income taxes ...........      $  (4,205)      $   8,867       $  14,790
                                    =========       =========       =========
Identifiable assets:
   Hospitality ...............      $ 122,442       $ 123,958       $ 106,529
   Government ................         14,429          10,898           9,015
   Other .....................          9,647           7,402           9,605
                                    ---------       ---------       ---------
           Total .............      $ 146,518       $ 142,258       $ 125,149
                                    =========       =========       =========
Goodwill:
   Hospitality ...............      $  26,349       $  25,138       $  20,086
   Government ................            649             596             536
                                    ---------       ---------       ---------
           Total .............      $  26,998       $  25,734       $  20,622
                                    =========       =========       =========

Depreciation and amortization:
   Hospitality ...............      $   3,622       $   3,453       $   3,321
   Government ................             81              42              80
   Other .....................            376             389             354
                                    ---------       ---------       ---------
           Total .............      $   4,079       $   3,884       $   3,755
                                    =========       =========       =========

Capital expenditures:
   Hospitality ...............      $   1,788       $     903       $   1,385
   Government ................             57              14              74
   Other .....................            172             272             223
                                    ---------       ---------       ---------
           Total .............      $   2,017       $   1,189       $   1,682
                                    =========       =========       =========

<PAGE>
     The following  table presents  revenues by country based on the location of
the use of the product or services.

                        2007           2006        2005
                     ---------     ---------    ---------

United States .      $179,323      $181,482      $183,383
Other Countries        30,161        27,185        22,256
                     --------      --------      --------
Total .........      $209,484      $208,667      $205,639
                     ========      ========      ========


     The following table presents assets by country based on the location of the
asset.

                        2007           2006        2005
                     ---------     ---------    ---------

United States .      $134,766      $134,799      $119,627
Other Countries        11,752         7,459         5,522
                     --------      --------      --------
    Total .....      $146,518      $142,258      $125,149
                     ========      ========      ========

     Customers  comprising  10% or  more of the  Company's  total  revenues  are
summarized as follows:

                                   2007      2006      2005
                                  -----     -----     ------
Hospitality segment:
  McDonald's Corporation ...       25%       26%       28%
  Yum! Brands, Inc. ........       15%       14%       13%
Government segment:
  U.S. Department of Defense       31%       30%       27%
All Others .................       29%       30%       32%
                                  ---       ---       ---
                                  100%      100%      100%
                                  ===       ===       ===

Note 12 -- Fair Value of Financial Instruments

     Estimated fair values of financial instruments classified as current assets
or liabilities  approximate  carrying values due to the short-term nature of the
instruments.   Such  current  assets  and  liabilities  include  cash  and  cash
equivalents,  accounts  receivable,  borrowings  under lines of credit,  current
portion of long-term debt and accounts payable. The estimated fair values of the
Company's  long-term debt at December 31, 2007 and 2006 is based on variable and
fixed interest rates at December 31, 2007 and 2006, respectively, for new issues
with similar remaining maturities and approximates respective carrying values at
December 31, 2007 and 2006.  At December 31, 2007,  the fair market value of the
Company's  interest  rate swap  includes a realized  loss of $154,000,  which is
included as a component of interest expense within the consolidated statement of
operations  and as a  component  of accrued  expenses  within  the  consolidated
balance sheet.
<PAGE>

     Fair  value  estimates  are made at a  specific  point  in  time,  based on
relevant  market  information and  information  about the financial  instrument.
These estimates are subjective in nature and involve  uncertainties  and matters
of significant  judgment and,  therefore,  cannot be determined  with precision.
Changes in assumptions could significantly affect the estimates.

Note 13 -- 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 2007,
2006, and 2005 the Company  received rental income amounting to $117,300 for the
lease of the facility. All lease payments are current at December 31, 2007.

     The  Company  also  leases  office  space  from  an  officer  of one of its
subsidiaries.  The lease is for a period of five years  beginning  on October 1,
2004 at an annual rate of $360,000.  In 2007,  2006,  and 2005, the Company paid
$360,000 to the officer under this lease.

<PAGE>


Note 14 -- Selected Quarterly Financial Data (Unaudited)
<TABLE>
<CAPTION>

                                                            Quarter ended
                                                (in thousands except per share amounts)
          2007                         March 31       June 30        September 30   December 31
          ----                         --------       -------        ------------   -----------
<S>                                    <C>            <C>            <C>            <C>
Net revenues ....................      $ 47,836       $ 49,872       $ 51,577       $ 60,199
Gross margin ....................        10,808         12,635         12,402         16,063
Net income (loss) ...............        (1,308)        (1,021)          (862)           483
Basic earnings (loss) per share .          (.09)          (.07)          (.06)           .03
Diluted earnings (loss) per share          (.09)          (.07)          (.06)           .03


                                                            Quarter ended
                                                  (in thousands except per share amounts)
          2006                         March 31       June 30      September 30     December 31
          ----                         --------       -------       ----------      -----------

Net revenues .............             $ 52,597       $ 53,343       $ 48,534       $ 54,193
Gross margin .............               14,363         14,911         12,177         14,058
Net income ...............                2,012          2,338            550            821
Basic earnings per share .                  .14            .16            .04            .06
Diluted earnings per share                  .14            .16            .04            .06


</TABLE>

<PAGE>


                                   SIGNATURES

     Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its  behalf  by the  undersigned,  thereunto  duly  authorized.

                                              PAR  TECHNOLOGY CORPORATION

March 17, 2008                                John W. Sammon, Jr.
                                              --------------------------------
                                              John W. Sammon, Jr.
                                              Chairman of Board and President


                            -------------------------

     Pursuant to the  requirements of the Securities  Exchange Act of 1934, this
report  has  been  signed  below  by the  following  persons  on  behalf  of the
registrant and in the capacities and on the dates indicated.

--------------------------------------------------------------------------------
  Signatures                          Title                         Date
--------------------------------------------------------------------------------

/s/John W. Sammon
----------------------
John W. Sammon                Chairman of Board and              March 17, 2008
                              President (Principal
                               Executive Officer)
                               and Director

/s/Charles A. Constantino
-------------------------
Charles A. Constantino        Executive Vice President           March 17, 2008
                              and Director

/s/Sangwoo Ahn
----------------------
Sangwoo Ahn                   Director                           March 17, 2007

/s/James A. Simms
----------------------
James A. Simms                Director                           March 17, 2007


/s/Paul D. Nielsen
----------------------
Paul D. Nielsen               Director                           March 17, 2007


/s/Kevin R. Jost
----------------------
Kevin R. Jost                 Director                           March 17, 2007

/s/Ronald J. Casciano
----------------------
Ronald J. Casciano           Vice President, Chief Financial     March 17, 2007
                             Officer and Treasurer


<PAGE>
<TABLE>
<CAPTION>


                                List of Exhibits

Exhibit No.       Description of Instrument
-----------       -------------------------

   <S>        <C>                                                      <C>
   3.1        Certificate of Incorporation,                            Filed as Exhibit 3(i) to the quarterly
              as amended                                               report on Form 10Q for the period ended
                                                                       June 30, 2006, of PAR Technology
                                                                       Corporation and incorporated herein by
                                                                       reference.

   3.3        By-laws, as amended.                                     Filed as Exhibit 3.1 to Registration
                                                                       Statement on Form S-2 (Registration
                                                                       No. 333-04077)of PAR Technology
                                                                       Corporation incorporated herein by
                                                                       reference.

   4          Specimen Certificate representing the                    Filed as Exhibit 3.1 to Registration
              Common Stock.                                            Statement on Form S-2 (Registration
                                                                       No. 333-04077)of PAR Technology
                                                                       Corporation incorporated herein by
                                                                       reference.

  10.1        Letter of Agreement with Sandman                         Filed as Exhibit 10.1 to Form S-3/A
              - SCI Corporation                                        (Registration No. 333-102197) of
                                                                       PAR Technology Corporation
                                                                       incorporated herein by reference.

  10.2        Asset Purchase Agreement dated October 27,               Filed as Exhibit 10.1 to the current
              2006. By and among PAR Technology                        report on Form 8K dated November 8,
              Corporation, Par-Siva Corporation and                    2006 of PAR Technology Corporation
              SIVA Corporation.                                        and incorporated herein by reference.

  10.3        JP Morgan term loan.                                     Filed as Exhibit 10.3 to Form 10-K for
                                                                       the year ended December 31, 2006 and
                                                                       incorporated herein by reference.

  10.4        2005 Equity Incentive Plan of PAR                        Filed as Exhibit 4.2 to Form S-8
              Technology Corporation                                   (Registration No. 333-137647) of
                                                                       PAR Technology Corporation and
                                                                       incorporated herein by reference.

  10.5        Form of Stock Option Award Agreement                     Filed as Exhibit 4.3 to Form S-8
                                                                       (Registration No. 333-137647) of
                                                                       PAR Technology Corporation and
                                                                       incorporated herein by reference.

  10.6        Form of Restricted Stock Award Agreement                 Filed as Exhibit 4.4 to Form S-8
                                                                       (Registration No. 333-137647) of
                                                                       PAR Technology Corporation and
                                                                       incorporated herein by reference.
</TABLE>

<PAGE>
<TABLE>
<CAPTION>


                                List of Exhibits (Continued)

Exhibit No.       Description of Instrument
-----------       -------------------------

<S>           <C>

10.7          June 2007 amendment to bank line of credit
              agreement - JP Morgan Chase

10.8          February 2008 amendment to bank line of
              credit agreement - JP Morgan Chase

10.9          June 2007 amendment to bank line of
              credit agreement - NBT Bank

10.10         January 2008 amendment to bank line of
              credit agreement - NBT Bank

22            Subsidiaries of the registrant

23            Consent of Independent Registered Public
              Accounting Firm

31.1          Certification of Chairman of the Board
              and Chief Executive Officer Pursuant
              to Section 302 of the Sarbanes-Oxley Act
              of 2002.

31.2          Certification of Vice President, Chief
              Financial Officer and Treasurer Pursuant
              to Section 302 of the Sarbanes-Oxley Act
              of 2002.

32.1          Certification of Chairman of the Board
              and Chief Executive Officer and
              Vice President, Chief Financial Officer
              and Treasurer Pursuant to 18 U.S.C.
              Section 1350, as Adopted Pursuant to
              Section 906 of the Sarbanes-Oxley Act of 2002.
</TABLE>

<PAGE>
                                  EXHIBIT 10.7



                                 AMENDMENT NO. 2
                                       TO
                      AMENDED AND RESTATED CREDIT AGREEMENT

     This  Amendment  No. 2 (the  "Amendment"),  dated as of June 19,  2007,  is
between PAR TECHNOLOGY CORPORATION, a Delaware corporation (the "Borrower"), and
JPMORGAN CHASE BANK, N.A. (the "Bank").

                                 R E C I T A L S

     A. The Borrower and the Bank are parties to an Amended and Restated  Credit
Agreement  dated as of April 19, 2006,  as amended by an  Amendment  No. 1 dated
November 2, 2006 (the "Credit Agreement").

     B. The Borrower has requested  that the Bank amend the Credit  Agreement to
suspend the testing of certain financial covenants for a period of time.

     C. The Bank is willing to amend the Credit  Agreement  as  requested by the
Borrower upon the terms and conditions set forth in this Amendment.

          NOW, THEREFORE, the parties agree as follows:

     1. Definitions.  All capitalized terms used in this Amendment which are not
otherwise  defined  shall have the  meanings  given to those terms in the Credit
Agreement, except where such terms are amended herein.

     2. Amendment of Credit Agreement.

          2.1 The following  defined term is added to Section 1.01 of the Credit
     Agreement:

          "Amendment  No. 2  Effective  Date"  means  the date on which  all the
     conditions  to  this  Amendment  have been satisfied.
<PAGE>

          2.2 The following  defined term is added to Section 1.01 of the Credit
     Agreement:

          "EBITDA"  or  "Earnings  Before  Interest,   Taxes,  Depreciation  and
          Amortization"  means,  with respect to Borrower  and its  consolidated
          Subsidiaries,  on a consolidated basis, for any period, the sum of the
          following  for such period  determined in  accordance  with GAAP:  (a)
          consolidated net income for such period,  plus (b) the amount deducted
          in determining consolidated net income representing income taxes, plus
          (c)  the  amount  deducted  in  determining  consolidated  net  income
          representing  interest  expense,  plus  (d)  the  amount  deducted  in
          determining  consolidated net income representing non-cash charges for
          depreciation  and  amortization,  minus  (e) the  amount  included  in
          determining  consolidated net income  representing gains from the sale
          or disposition of assets not sold in the ordinary  course of business,
          minus (f) the amount included in determining  consolidated  net income
          representing  income from any reappraisal,  revaluation or write-up of
          assets, minus (g) the amount included in determining  consolidated net
          income  representing  other  extraordinary or non-recurring  income or
          gain;  provided  that (x) the net income of any  Person  that is not a
          wholly-owned  Subsidiary or that is accounted for by the equity method
          of  accounting  shall be included  only to the extent of the amount of
          dividends or distributions actually received by Borrower or one of its
          Subsidiaries,  (y) the net income of any Person  accrued  prior to the
          date  it  becomes  a  wholly-owned  Subsidiary  or is  merged  into or
          consolidated  with Borrower or another  Subsidiary  shall be excluded,
          and (z)  the net  income  of a  Subsidiary  which  for any  reason  is
          unavailable  for  payment  of  dividends  to the  Borrower  or another
          Subsidiary shall be excluded.

2.3 The  definition  of  Applicable  Rate  found in  Section  1.01 of the Credit
Agreement is amended by adding the following sentence at the end thereof:

               Notwithstanding  anything in this definition to the contrary, the
          Applicable Rate for the period from the Amendment No. 2 Effective Date
          to August 15,  2007 shall be the rate set forth in Category 2, and the
          Applicable  Rate for the period  from  August 16,  2007 to the date on
          which  Borrower  delivers to Bank the financial  statements  and other
          information  required to be delivered pursuant to Section 5.01 for the
          quarter  ending March 31, 2008 shall be the rate set forth in Category
          5; provided that, except as otherwise provided in Section 2.10(c),  at
          any  time an Event of  Default  has  occurred  and is  continuing  the
          Applicable  Rate  shall be 1.00%  higher  than  the  rate  that  would
          otherwise be applicable.

          2.4  Section  6.09  of the  Credit  Agreement  is  amended  to read as
          follows:

          SECTION 6.09.  Leverage Ratio.  Borrower will not suffer or permit its
          Leverage  Ratio,  as measured at the end of each Fiscal Quarter (other
          than the Fiscal Quarters ending June 30, 2007, September 30, 2007, and
          December 31, 2007), to be greater than 3.50 to 1.0.
<PAGE>

          2.5  Section  6.10  of the  Credit  Agreement  is  amended  to read as
          follows:

          SECTION 6.10. Fixed Charge Coverage Ratio. Borrower will not suffer or
          permit its Fixed Charge Coverage Ratio, as measured at the end of each
          Fiscal Quarter (other than the Fiscal  Quarters  ending June 30, 2007,
          September 30, 2007, and December 31, 2007), to be less than 4.0 to 1.0

2.6 The following new Section 6.12 is added to the Credit Agreement  immediately
following Section 6.11:

          SECTION 6.12. Minimum EBITDA. Borrower shall not permit its EBITDA for
          the rolling  four-quarter  periods ending June 30, 2007, September 30,
          2007 and December 31, 2007 to be less than $2,500,000, $1,500,000, and
          $1,100,000, respectively.

     3. Representations and Warranties.  The Borrower represents and warrants to
the Bank that the following statements are true, correct and complete:

          3.1 Each of the representations and warranties made by the Borrower in
     the  Credit  Agreement  is true and  correct  on and as of the date of this
     Amendment and after giving effect to the transactions  contemplated by this
     Amendment.

          3.2 No Default or Event of Default has occurred and is continuing.

          3.3 This Amendment has been duly and validly executed and delivered by
     the  Borrower  and  constitutes  its legal,  valid and binding  obligation,
     enforceable against the Borrower in accordance with its terms.

          4. Conditions to Effectiveness  of Amendment.  This Amendment shall be
     effective  only when and if each of the  following  conditions is satisfied
     (or waived in accordance with Section 8.02 of the Credit Agreement):

          4.1 The Bank (or its counsel)  shall have  received  from the Borrower
     either (i) a counterpart of this Amendment signed on behalf of the Borrower
     or (ii)  written  evidence  satisfactory  to the Bank  (which  may  include
     telecopy or  electronic  transmission  of a signed  signature  page of this
     Amendment) that the Borrower has signed a counterpart of this Amendment.

          4.2 The Bank shall have received such  documents and  certificates  as
     the  Bank  or  its  counsel  may   reasonably   request   relating  to  the
     organization,  existence  and  good  standing  of  the  Borrower  and  each
     Corporate  Guarantor and the  authorization of this Amendment,  all in form
     and substance satisfactory to the Bank and its counsel.
<PAGE>

          4.3 The Bank shall have received true and correct copies, certified as
     to  authenticity  by the  Borrower,  of an  amendment  to  Borrower's  loan
     agreement with NBT Bank, N.A. containing financial covenants  substantially
     the same as those set forth in this Amendment No. 2.

          4.4 The Bank shall have  received a  Confirmation  and  Acknowledgment
     from each Corporate Guarantor in the form attached as Exhibit A.

          4.5 The  Borrower  shall  have  paid  or  agreed  to pay all  invoices
     presented  to  Borrower  for  expense  reimbursements  due to the  Bank  in
     connection with the preparation of this Amendment.

          5. Effect of this  Amendment.  This Amendment  constitutes  the entire
     agreement  of the parties with respect to the subject  matter  hereof,  and
     supersedes all prior oral or written communications,  memoranda, proposals,
     negotiations,  discussions, term sheets and commitments with respect to the
     subject  matter  hereof.  Except as  expressly  provided  herein,  no other
     changes or modifications to the Credit Agreement are intended or implied by
     this  Amendment,  and in all other respects the Credit  Agreement is hereby
     specifically ratified,  restated and confirmed by as of the Amendment No. 2
     Effective  Date. To the extent that any  provision of the Credit  Agreement
     conflicts  with any  provision  of this  Amendment,  the  provision of this
     Amendment shall control.

          6.  Counterparts.  This  Amendment  may be  signed  in any  number  of
     counterparts,  each of which shall be deemed an original,  but all of which
     taken together shall constitute one and the same instrument. Delivery of an
     executed  signature page to this Amendment by facsimile  transmission shall
     be as effective as delivery of a manually signed counterpart.

                  [Remainder of page intentionally left blank]



<PAGE>


     IN WITNESS  WHEREOF,  the parties  have caused  this  Amendment  to be duly
executed as of the day and year first above written.


                                   PAR TECHNOLOGY CORPORATION



                                   By: /s/Ronald J. Casciano
                                   -------------------------
                                   Name:  Ronald J. Casciano
                                   Title: Treasurer


                                   JPMORGAN CHASE BANK, N.A.



                                   By: /s/Frederick K. Miller
                                   --------------------------
                                   Name:  Frederick K. Miller
                                   Title: Vice President


<PAGE>
                                EXHIBIT 10.8


                                 AMENDMENT NO. 3
                                       TO
                      AMENDED AND RESTATED CREDIT AGREEMENT

     This  Amendment No. 3 (the  "Amendment"),  dated as of February 7, 2008, is
between PAR TECHNOLOGY CORPORATION, a Delaware corporation (the "Borrower"), and
JPMORGAN CHASE BANK, N.A. (the "Bank").

                                 R E C I T A L S

     A. The Borrower and the Bank are parties to an Amended and Restated  Credit
Agreement  dated as of April 19, 2006, as amended by an Amendment No. 1 dated as
of  November  2, 2006 and by an  Amendment  No. 2 dated as of June 19, 2007 (the
"Credit Agreement").

     B. The Borrower has requested that the Bank (i) waive  compliance  with the
requirements   of  Section  6.12  of  the  Credit   Agreement  for  the  rolling
four-quarter period ending December 31, 2007 and (ii) amend the Credit Agreement
to amend certain financial covenants.

     C. The Bank is  willing  to agree to such  waiver  and to amend the  Credit
Agreement as requested by the Borrower upon the terms and  conditions  set forth
in this Amendment.

                  NOW, THEREFORE, the parties agree as follows:

     1. Definitions.  All capitalized terms used in this Amendment which are not
otherwise  defined  shall have the  meanings  given to those terms in the Credit
Agreement, except where such terms are amended herein.

     2. Waiver.  Subject to the  conditions and upon the terms set forth in this
Amendment, and in reliance on the representations and warranties of the Borrower
set  forth  in this  Amendment,  the  Bank  hereby  waives  compliance  with the
requirements   of  Section  6.12  of  the  Credit   Agreement  for  the  rolling
four-quarter period ended December 31, 2007; provided, however, that such waiver
shall be automatically rescinded and of no further force and effect in the event
that  Borrower's  audited  financial  statements for the year ended December 31,
2007 delivered to the Bank pursuant to Section  5.01(a) of the Credit  Agreement
reflect  that  Borrower's  EBITDA  for the  rolling  four-quarter  period  ended
December 31, 2007 is less than $750,000.

     3. Amendment of Credit Agreement.

          3.1  Section  6.09  of the  Credit  Agreement  is  amended  to read as
     follows:

          SECTION 6.09.  Leverage Ratio.  Borrower will not suffer or permit its
     Leverage  Ratio,  as measured at the end of each Fiscal Quarter (other than
     the Fiscal  Quarters  ending  December 31, 2007 and March 31, 2008),  to be
     greater than 3.50 to 1.0.  Borrower  will not suffer or permit its Leverage
     Ratio,  as measured at the end of the Fiscal Quarter ending March 31, 2008,
     to be greater than 4.75 to 1.0.

          3.3  Section  6.10  of the  Credit  Agreement  is  amended  to read as
     follows:

          SECTION 6.10. Fixed Charge Coverage Ratio. Borrower will not suffer or
     permit its Fixed  Charge  Coverage  Ratio,  as  measured at the end of each
     Fiscal Quarter (other than the Fiscal  Quarters  ending  December 31, 2007,
     March 31,  2008 and June 30,  2008),  to be less than 4.0 to 1.0.  Borrower
     will not suffer or permit its Fixed Charge  Coverage  Ratio, as measured at
     the end of the Fiscal  Quarter  ending March 31, 2008, to be less than 1.20
     to 1.0. Borrower will not suffer or permit its Fixed Charge Coverage Ratio,
     as measured at the end of the Fiscal  Quarter  ending June 30, 2008,  to be
     less than 2.3 to 1.0.

     4. Representations and Warranties.  The Borrower represents and warrants to
the Bank that the following statements are true, correct and complete:

          4.1 Each of the representations and warranties made by the Borrower in
     the  Credit  Agreement  is true and  correct  on and as of the date of this
     Amendment and after giving effect to the transactions  contemplated by this
     Amendment.

          4.2 No Default or Event of Default has occurred and is continuing.

          4.3 This Amendment has been duly and validly executed and delivered by
     the  Borrower  and  constitutes  its legal,  valid and binding  obligation,
     enforceable against the Borrower in accordance with its terms.

     5.  Conditions to  Effectiveness  of  Amendment.  This  Amendment  shall be
effective  only when and if each of the  following  conditions  is satisfied (or
waived in accordance with Section 8.02 of the Credit Agreement):

          5.1 The Bank (or its counsel)  shall have  received  from the Borrower
     either (i) a counterpart of this Amendment signed on behalf of the Borrower
     or (ii)  written  evidence  satisfactory  to the Bank  (which  may  include
     telecopy or  electronic  transmission  of a signed  signature  page of this
     Amendment) that the Borrower has signed a counterpart of this Amendment.

          5.2 The Bank shall have received such  documents and  certificates  as
     the  Bank  or  its  counsel  may   reasonably   request   relating  to  the
     organization,  existence  and  good  standing  of  the  Borrower  and  each
     Corporate  Guarantor and the  authorization of this Amendment,  all in form
     and substance satisfactory to the Bank and its counsel.
<PAGE>

          5.3 The Bank shall have received true and correct copies, certified as
     to  authenticity  by the  Borrower,  of an  amendment  to  Borrower's  loan
     agreement with NBT Bank, N.A. containing financial covenants  substantially
     the same as those set forth in this Amendment.

          5.4 The Bank shall have  received a  Confirmation  and  Acknowledgment
     from each Corporate Guarantor in the form attached as Exhibit A.

          5.5 The  Borrower  shall  have  paid  or  agreed  to pay all  invoices
     presented  to  Borrower  for  expense  reimbursements  due to the  Bank  in
     connection with the preparation of this Amendment.

     6.  Effect  of  this  Amendment.  This  Amendment  constitutes  the  entire
agreement  of the  parties  with  respect  to the  subject  matter  hereof,  and
supersedes  all prior  oral or  written  communications,  memoranda,  proposals,
negotiations,  discussions,  term  sheets and  commitments  with  respect to the
subject matter hereof.  Except as expressly provided herein, no other changes or
modifications to the Credit Agreement are intended or implied by this Amendment,
and in all other respects the Credit Agreement is hereby specifically  ratified,
restated and confirmed as of the dated of this Amendment. To the extent that any
provision  of  the  Credit  Agreement  conflicts  with  any  provision  of  this
Amendment, the provision of this Amendment shall control.

     7.   Counterparts.   This   Amendment  may  be  signed  in  any  number  of
counterparts,  each of which shall be deemed an original, but all of which taken
together shall constitute one and the same  instrument.  Delivery of an executed
signature page to this Amendment by facsimile transmission shall be as effective
as delivery of a manually signed counterpart.

                  [Remainder of page intentionally left blank]



<PAGE>


     IN WITNESS  WHEREOF,  the parties  have caused  this  Amendment  to be duly
executed as of the day and year first above written.


                                        PAR TECHNOLOGY CORPORATION



                                        By: /s/Ronald J. Casciano
                                        -------------------------
                                        Name:  Ronald J. Casciano
                                        Title: Treasurer


                                        JPMORGAN CHASE BANK, N.A.



                                        By: /s/Frederick K. Miller
                                        --------------------------
                                        Name: Frederick K. Miller
                                        Title: Vice President



<PAGE>
                                    <PAGE>


                                  EXHIBIT 10.9

                     AMENDMENT TO A BUSINESS LOAN AGREEMENT
          AND TEMPORARY MODIFICATION OF A PROMISSORY NOTE INTEREST RATE
               MADE AMONG PAR TECHNOLOGY CORPORATION, AS BORROWER
 AND THE FOLLOWING GUARANTORS OF PAYMENT: PARTECH, INC.; PAR GOVERNMENT SYSTEMS
 CORORATION; ROME RESEARCH CORPORATION; PAR SPRINGER-MILLER SYSTEMS, INC.; AND
                   NBT BANK, NATIONAL ASSOCIATION, AS LENDER

THIS  AMENDMENT TO A BUSINESS LOAN  AGREEMENT AND  TEMPORARY  MODIFICATION  OF A
PROMISSORY NOTE INTEREST RATE (this  "Amendment",  hereinafter) dated as of June
20, 2007,  is made to amend a certain  business loan  agreement  dated April 21,
2006 (hereinafter the "Loan  Agreement") and a certain  promissory note (Line of
Credit)  dated  of even  date  as the  Loan  Agreement,  in the  maximum  amount
outstanding,  at any time or  under  any  contingency,  of  $12,500,000.00  (the
"Note",  hereinafter),  and is  entered  into among PAR  Technology  Corporation
("Borrower",  hereinafter) a Delaware business  corporation,  having its primary
corporate  offices at 8383 Seneca  Turnpike,  New Hartford,  NY 13413; NBT Bank,
National  Association  ("Lender",  hereinafter),  a national banking association
having an office  for the  transaction  of  business  at 555  French  Road,  New
Hartford,  NY 13413;  and each of the  following as guarantors of payment of the
Loan  (as  hereinafter   defined):   Partech,   Inc.;  PAR  Government   Systems
Corporation;  Rome Research Corporation;  and PAR Springer-Miller  Systems, Inc.
("Guarantors",  collectively hereinafter,  and each being referred to separately
as a  "Guarantor"),  which execute this  Amendment,  together with their several
Reaffirmations of Guaranties (the  "Reaffirmations",  collectively)  dated as of
even date herewith,  in order to confirm and agree to the  modifications  to the
Loan Agreement, as hereinafter set forth.

                                    RECITALS:

WHEREAS,  Borrower has requested of Lender that Lender modify certain  Financial
Covenants required to be met by the Borrower pursuant to the Loan Agreement,  as
conditions  of the Loan;  and to make a temporary  modification  of the variable
rate of  interest  charged  under the Note  against  the  outstanding  principal
balance  of  the  Loan  from  time  to  time  (the  "Variable   Interest  Rate",
hereinafter); and

WHEREAS,  Lender has agreed to modify the Borrower's  compliance with certain of
such Financial  Covenants and to make a temporary  modification  of the Variable
Interest Rate, upon Borrower's  agreement to add to the Loan terms an additional
Financial  Covenant,  as hereinafter set forth,  which shall be made part of and

<PAGE>

thereby  modify  the  Loan  Agreement;  and to  execute  a  certain  "letter  of
understanding" (the "Letter of Understanding",  hereinafter) with respect to the
modification  of such  Financial  Covenants and Variable  Interest Rate, and the
effect  of such  modification  of such  Financial  Covenants  upon the  Variable
Interest Rate pricing set forth in the Note; and a corresponding modification of
the unused line of credit fee;

NOW  THEREFORE,  in  consideration  of the above  recitals,  and other  good and
valuable consideration,  acknowledged to have been exchanged between the parties
hereto, the parties hereto agree as follows:

     1.  Modification  to the  Loan  Agreement.  Paragraph  titled  "  Financial
     Covenants and Ratios" of the Loan  Agreement ( Page 7 thereof) is modified,
     as follows:

          1.1.  Subparagraph  "B" "Fixed Charge Coverage Ratio" is deleted,  and
     replaced with the following:



<PAGE>


     B. Fixed Charge  Coverage Ratio:  Excluding  quarters ending June 30, 2007,
September 30, 2007, and December 31, 2007, respectively, Borrower shall maintain
a   Fixed   Charge   Coverage   Ratio,   measured   quarter-annually,   upon   a
rolling-four-quarters basis, based upon Borrower's filed SEC 10Q Reports, of not
less than 4.0 to 1.0  (4.0:1.0).  The Fixed Charge  Coverage shall be determined
based upon the following formula:

A fraction,    (a) the numerator of which is:Earnings measured before deductions
               therefrom of Interest, Taxes, Depreciation, and Amortization; and

               (b) the  denominator of which is:  Interest  Expense plus current
               maturities of long-term debt.

     1.2.  Subparagraph "C" "Leverage  Ratio" is deleted,  and replaced with the
following:

     C. Leverage Ratio.  Excluding quarters ending June 30, 2007,  September 30,
2007,  and December 31, 2007,  respectively,  Borrower shall maintain a Leverage
Ratio measured at the end of each of Borrower's fiscal  quarter-annual  periods,
determined  on a  rolling-four-quarters  basis,  of  not  more  than  3.5 to 1.0
(3.5:1.0). The Leverage Ratio shall be applied based upon the following formula:

     A fraction,    (a) the numerator of which is: all institutional debt of the
     borrower; and

                    (b) the denominator of which is:  Earnings,  measured before
                    deductions therefrom, of Interest,  taxes,  Depreciation and
                    Amortization.

     1.3.  The  following  new  Financial  Covenant  is made a part of the  Loan
Agreement:

     Minimum EBITDA Covenant:  Borrower shall maintain a Minimum EBITDA measured
quarter-annually,  commencing  with the  quarter-annual  period  ending June 30,
2007, on a  rolling-twelve-months  basis,  based upon  Borrower's  filed SEC 10Q
reports, as follows:

     (a)  Quarter-Annual  Period  ending June 30,  2007:  Minimum  EBITDA of Two
Million Five Hundred Thousand and 00/100ths Dollars ($2,500,000.00)

     (b) Quarter-Annual  Period ending September 30, 2007: Minimum EBITDA of One
Million Five Hundred Thousand and 00/100ths Dollars ($1,500,000.00)

     (c)  Quarter-Annual  Period ending December 31, 2007: Minimum EBITDA of One
Million One Hundred Thousand and 00/100ths Dollars ($1,100,000.00).

     This Covenant with respect to Minimum  EBITDA shall cease,  as an effective
covenant and condition of the Loan and Loan Agreement, with the inception of the
first quarter-annual period of Borrower's fiscal year 2008.
<PAGE>

"EBITDA" means the following: "Earnings, measured before deductions therefrom of
Interest, taxes, Depreciation, and Amortization"

     2. Temporary Modification of the Variable Interest Rate.

     2.1. The Variable  Interest Rate charged under the Note evidencing the Loan
is modified,  such that,  notwithstanding  the terms and conditions set forth in
the Note,  the Variable  Interest  Rate from August 16,  2007,  to May 15, 2008,
shall be  determined  quarter-annually  based upon the Index (as  defined in the
Note) plus one hundred seventy five basis points (175 BP),  without  application
of the Leverage Ratio, for purposes of determining the Margin (as defined in the
Note).

     2.2.  The  modification  set  forth in  Paragraph  2.1.  hereinabove  shall
continue in effect until May 15, 2008, upon which date the modification shall be
terminated;  the determination of the Variable Interest Rate shall thereafter be
made by reference to the Note,  excluding the effect of this  modification;  and
the terms and conditions of the Note will revert to those terms set forth within
the Note,  without the effect and application of the  modifications set forth in
Paragraph 2.1 hereinabove.

     2.3. Except for the  modifications  set forth in Paragraph 2.1 hereinabove,
no other terms or conditions of the Note are modified.

     3. Guarantors' Consent.  Each of the Guarantors executes this Amendment for
purposes of consenting to the  modifications to the Loan Agreement and the Note;
and  Guarantors'   confirmations,   continuation  and  reaffirmations  of  their
respective  Guaranties with respect to such  modifications,  are, in addition to
their  consents  evidenced  by this  Amendment,  set  forth  in  each  of  their
respective Reaffirmations (as hereinabove defined).

     4.  Modification  Fee. In consideration of the amendments and modifications
to the Loan Agreement and Note effected  hereby,  the Borrower does agree,  upon
execution  hereof,  to pay a Business Loan Agreement and Note  Modification  Fee
(the "Modification Fee", hereinafter),  of Twenty Thousand and 00/100ths Dollars
($20,000.00), due and payable on or before Lender's execution of this Amendment.

     5. No other Changes.  This  Amendment  modifies the Loan Agreement and Note
only as specifically set forth  hereinabove;  and except as modified herein, the
Loan Agreement and Note each continue in full force and effect,  without further
or additional modification.

     6. Related  Documents.  This  Amendment,  and any other  documents made and
executed by and between,  or among,  Borrower,  Lender and  Guarantor(s),  which
documents  are all dated as of even date  herewith,  are  included  as  "Related
Documents", as that term is defined in the Loan Agreement.

     7. Entire Understanding.  This Amendment, the Loan Agreement, the Note, and
the Related  Documents  dated as of even date  herewith,  constitute  the entire
understanding and agreement of the parties hereto as to the matters set forth in
this Amendment;  and no alteration of or modification of this Amendment,  to the
Loan Agreement,  or to the Note, shall be effective unless given in writing, and
signed by the party or parties sought to be charged or bound by such  alteration
and/or modification.
<PAGE>

     8. Venue; Waiver of Trial By Jury; Choice of Law. This Amendment,  the Loan
Agreement, the Note, and the Guaranties are, and have been, made among Borrower,
Guarantors  and  Lender  in the State of New York.  If there is a  lawsuit,  the
Borrower  and  Guarantors  agree,  upon  Lender's  request,  to  submit  to  the
jurisdiction of the Courts of Oneida County, State of New York. LENDER, BORROWER
AND  GUARANTORS  HEREBY  WAIVE  THE  RIGHT  TO ANY  JURY  TRIAL  IN ANY  ACTION,
PROCEEDING OR  COUNTERCLAIM  BROUGHT BY ANY OF THEM AGAINST ANY  OTHER(S).  This
Amendment  shall be governed by and construed in accordance with the laws of the
State of New York, exclusive of law rules and public policies.

     9. Notices.  All notices required to be given under this Amendment shall be
given in writing in accordance  with those same  "notice"  terms as set forth in
the Loan Agreement on page 12 thereof, titled "Notices."

     10. Successors and Assigns. The covenants and agreements contained by or on
behalf of Borrower or  Guarantors  shall bind their  respective  successors  and
assigns,  shall  inure to the  benefit  of the  Lender,  its  successors  and/or
assigns.  Borrower and Guarantors shall not,  however,  have the right to assign
their rights under this Amendment or Loan Agreement, or their interests therein,
without the prior written consent of the Lender.

     11. Severability.  If a court of competent jurisdiction finds any provision
of this  Amendment,  and/or the Loan  Agreement,  and/or the Note,  as  modified
hereby,  to be invalid or unenforceable  as to any person or circumstance,  such
finding shall not render that provision invalid or unenforceable as to any other
persons or  circumstances.  If feasible,  any such offending  provision shall be
deemed to be modified  to be within the limits of  enforceability  or  validity;
however, if the offending provision cannot be so modified,  it shall be stricken
and all other provisions of this Amendment,  the Loan Agreement, and the Note in
all other respects shall remain valid and enforceable.

     12.  Performance.  TIME  IS OF  THE  ESSENCE  in  the  performance  of  all
requirements  set forth in this  Amendment,  in the Loan  Agreement,  and in the
Note,  including,  but not limited to,  those  requirements  which are  modified
hereby.

     13. Costs and Expenses.  Borrower and  Guarantors  shall pay the reasonable
out-of-pocket costs and expenses of Lender,  including,  but not limited to: the
Modification  Fee, the reasonable fees and  disbursements  of Lender's  counsel,
incurred by Lender in connection  with the  negotiation  and preparation of this
Amendment and the other Related  Documents of even date; any further  amendments
<PAGE>

hereto or to the Loan Agreement,  the Note,  and/or the other Related  Documents
(whether  or  not  of  even  date  herewith);   any  amendments  required  to  a
participation  agreement  existing or  concurrently  entered into between Lender
with a participant or participants.

     BORROWER AND EACH GUARANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS
                OF THIS AMENDMENT, AND EACH AGREES TO ITS TERMS.

IN WITNESS WHEREOF, the parties hereto execute these presents, or cause the same
to be executed by their duly authorized representatives, as of June 20, 2007.

                                            PAR TECHNOLOGY CORPORATION

                                            By: /s/Ronald J. Caciano
                                            -----------------------------
                                            Ronald J. Casciano, Treasurer

                                            PARTECH, INC.

                                            By: /s/Ronald J. Caciano
                                            -----------------------------
                                            Ronald J. Casciano, Treasurer

                                            PAR GOVERNMENT SYSTEMS CORPORATION

                                            By: /s/Ronald J. Caciano
                                            -----------------------------
                                            Ronald J. Casciano, Treasurer

                                            ROME RESEARCH CORPORATION

                                            By: /s/Ronald J. Caciano
                                            -----------------------------
                                            Ronald J. Casciano, Treasurer

                                            PAR SPRINGER-MILLER SYSTEMS, INC.

                                            By: /s/Ronald J. Caciano
                                            -----------------------------
                                            Ronald J. Casciano, Treasurer

                                            NBT BANK, NATIONAL ASSOCIATION


                                            By: /s/Rex W. Cary
                                            ----------------------------
                                            Rex W. Cary, Vice President



<PAGE>


                                  EXHIBIT 10.10

                 (SECOND)AMENDMENT TO A BUSINESS LOAN AGREEMENT
       AND ACKNOWLEDGMENT OF THE INTEREST RATE AND TERMS OF REPAYMENT OF A
       PROMISSORY NOTE MADE AMONG PAR TECHNOLOGY CORPORATION, AS BORROWER
 AND THE FOLLOWING GUARANTORS OF PAYMENT: PARTECH, INC.; PAR GOVERNMENT SYSTEMS
                     CORPORATION; ROME RESEARCH CORPORATION;
     PAR SPRINGER-MILLER SYSTEMS, INC.; AND NBT BANK, NATIONAL ASSOCIATION,
                                   AS LENDER

INTENT AND BACKGROUND.  THIS (SECOND) AMENDMENT TO A BUSINESS LOAN AGREEMENT AND
ACKNOWLEDGMENT  OF INTEREST  RATE AND TERMS OF REPAYMENT  OF A  PROMISSORY  NOTE
(this "Amendment", hereinafter) dated as of January 1, 2008, is made to

(a) modify a certain  business  loan  agreement  dated April 21, 2006 (the "Loan
Agreement"  hereinafter)  as modified by a certain  Amendment to a Business Loan
Agreement and  Temporary  Modification  of a Promissory  Note Interest Rate (the
"First Amendment",  hereinafter),  dated as of June 20, 2007, entered into among
Borrower, Lender and Guarantors (each, as hereinafter defined); and

(b) confirm and acknowledge the original terms of repayment (including,  but not
limited to, the pricing structure of the interest rate) of a certain  promissory
note  (the  "Note",  hereinafter)  dated of even date as the Loan  Agreement  as
temporarily  modified  by the First  Amendment;  said Note being in the  maximum
principal  amount  permitted  to  be  outstanding,  at  anyone  time  under  any
contingency,  of Twelve  Million Five Hundred  Thousand  and  00/100ths  Dollars
($12,500,000.00).

The Note  evidences,  and said Loan  Agreement  is made with  respect  to,  that
certain unsecured line of credit in the maximum principal amount permitted to be
outstanding  at any one time  under  any  contingency,  of  $12,500,000.00  (the
"Loan",  hereinafter)  extended by NBT Bank,  National  Association,  a national
banking association having an office at 555 French Road, New Hartford, NY 13413,
as lender ("Lender",  hereinafter),  to PAR Technology  Corporation,  a Delaware
business corporation, having an office at 8383 Seneca Turnpike, New Hartford, NY
13413,  as  borrower  ("Borrower",  hereinafter);  the  payment of which Loan is
guarantied by each of the following corporations:  Partech, Inc.; PAR Government
Systems Corporation; Rome Research Corporation; and PAR Springer-Miller Systems,
Inc.  ("Guarantors",  collectively  hereinafter,  and  each  being  referred  to
separately as a "Guarantor").
<PAGE>

Guarantors,  having also entered into the Loan  Agreement for purposes of making
such  statements  and/or  agreements  set forth  therein  as being  those of the
Guarantors,  also execute this  Amendment,  together  with (inter alia)  certain
Reaffirmations of Guaranties (the  "Reaffirmations",  collectively)  dated as of
even date herewith,  in order to confirm and agree to the  modifications  to the
Loan Agreement,  as hereinafter set forth,  the  acknowledgment  of the terms of
repayment of the Note as set forth  therein,  and the  replacement  of the First
Amendment by this Amendment.

THIS AMENDMENT IS A REPLACEMENT  AMENDMENT.  THIS AMENDMENT AND THE TERMS HEREOF
ARE DEEMED TO SUPERSEDE AND REPLACE THE FIRST  AMENDMENT AND THE TERMS  THEREOF,
EFFECTIVE BEGINNING ON THE DATE OF THIS AGREEMENT.

                                 FIRST RECITAL:

     WHEREAS,  Borrower  has  requested  of Lender  that Lender  modify  certain
Financial  Covenants  required  to be met by the  Borrower  pursuant to the Loan
Agreement and as  subsequently  modified by the First  Amendment,  and waive and
terminate  a  certain  temporary  financial  covenant  established  in the First
Amendment; and

                                 SECOND RECITAL:

     WHEREAS,   Lender  has  agreed  to  such  modifications   (hereinafter  the
"Modifications"),  upon,  inter alia,  Borrower's and Guarantors'  entering into
this  Amendment,  replacing the First Amendment and its effect upon the Note and
Loan Agreement and the terms thereof, including, but not necessarily limited to,
its effect upon the Variable  Interest  Rate (as defined in the Note) and Unused
Line Fee (as defined in the Loan Agreement); and

                                 THIRD RECITAL:

     NOW THEREFORE,  in consideration of the above recitals,  and other good and
valuable consideration,  acknowledged to have been exchanged between the parties
hereto, the parties hereto agree as follows:

1. Modifications to the Loan Agreement.  Paragraph titled " Financial  Covenants
and Ratios" of the Loan Agreement ( Page 7) thereof) is modified, as follows:

     1.1.  Subparagraph  "B"  "Fixed  Charge  Coverage  Ratio" is  deleted,  and
replaced with the following:



<PAGE>


     B. Fixed Charge Coverage Ratio:

     B.1. For  Borrower's  fiscal  quarter-annual  period ending March 31, 2008,
Borrower   shall   maintain   a   Fixed   Charge   Coverage   Ratio,    measured
quarter-annually,  upon the immediately preceding  rolling-four-quarters,  based
upon Borrower's filed SEC 10Q Reports, of not less than 1.2:1.0; and

     B.2. For  Borrower's  fiscal  quarter-annual  period  ending June 30, 2008,
Borrower   shall   maintain   a   Fixed   Charge   Coverage   Ratio,    measured
quarter-annually,  upon the immediately preceding  rolling-four-quarters,  based
upon Borrower's filed SEC 10Q Reports, of not less than 2.3:1.0; and

     B.3.  Beginning  with  Borrower's  fiscal   quarter-annual   period  ending
September 30th, 2008 and continuing for each  successive  quarter-annual  period
throughout  the  remaining  term of the Loan,  Borrower  shall  maintain a Fixed
Charge  Coverage  Ratio,  measured  quarter-annually  at  the  end  of  each  of
Borrower's  fiscal  quarter-annual   periods,  upon  the  immediately  preceding
rolling-four-quarters,  based upon Borrower's filed SEC 10Q Reports, of not less
than 4.0:1.00.

     The Fixed Charge  Coverage  shall be  determined  based upon the  following
formula:

A fraction,  (a)  the numerator of which is: Earnings measured before deductions
                  therefrom of Interest, Taxes, Depreciation, and  Amortization
                  ("EBITDA"); and

             (b)  the denominator of which is: Interest Expense, plus current
                  maturities of long-term debt.

     1.2.  Subparagraph "C" "Leverage  Ratio" is deleted,  and replaced with the
following:

     C. Leverage Ratio.

     C.1. For Borrower's fiscal  quarter-annual period ending on March 31, 2008,
Borrower shall maintain a Leverage Ratio measured quarter-annually
upon the immediately-receding  rolling-four-quarters, based on Borrower's filed
SEC 10Q reports, of not more than 4.75:1.00.

     C.2. For Borrower's fiscal  quarter-annual  period ending on June 30, 2008,
and  continuing  for  each  successive   quarter-annual  period  throughout  the
remaining term of the Loan,  Borrower shall maintain a Leverage Ratio,  measured
quarter-annually upon the immediately-preceding rolling-four-quarters,  based on
Borrower's filed SEC 10Q reports, of not more than 3.5:1.00.

     C.3.  The  Leverage  Ratio  shall be  determined  based upon the  following
formula:
<PAGE>


     A fraction,  (a) the numerator of which is: all  institutional  debt of the
borrower; and

     (b) the denominator of which is: EBITDA (as hereinabove defined).

     2. EBIDTA  Requirement  Waived.  Lender  hereby waives all  requirement  of
Borrower to comply with that certain  Minimum  EBITDA  Covenant,  as required in
Paragraph  1.3(c)  of the  First  Amendment.  Hereinafter,  the  Minimum  EBITDA
Covenant is deleted as a covenant applicable to the Borrower with respect to the
Loan.

     3 Terms of the Note and Unused  Line Fee  Confirmed.  Borrower,  Lender and
Guarantors agree that (a) effective as of the date of this Amendment, all effect
of the First  Amendment on the Note has been  terminated,  and that the original
terms of the Note as set forth  therein,  including,  but not  limited  to,  the
matrix pricing  structure  effecting the level of the Margin as set forth in the
Note,  now governs the Variable  Interest Rate charged on the Loan; (b) that the
current  Leverage Ratio exceeds  3.00:1.00;  and that the effect thereof is that
(i)  pursuant to the terms of the Note,  the Variable  Interest  Rate is now two
hundred basis points (200) above the Index,  adjustable  in accordance  with the
terms of the Note; and (ii) pursuant to the terms of the Loan Agreement, Page 7,
Paragraph D.2 of Section titled "Financial  Covenants and Ratios",  the price of
the Unused Line Fee,  is at one half of one  percent  (.05) of the amount of the
unused  Loan  principal  during the prior  quarter-annual  period of  Borrower's
fiscal year,  subject to future  continuing  adjustment in  accordance  with the
terms of the Loan Agreement and the applicable provisions of the Note.

     4. Guarantors' Consent.  Each of the Guarantors executes this Amendment for
purposes of  consenting to the  Modifications;  and  Guarantors'  confirmations,
continuation and  reaffirmations of their respective  Guaranties with respect to
such  modifications,  are,  in  addition  to their  consents  evidenced  by this
Amendment, set forth in each of their respective  Reaffirmations (as hereinabove
defined).

     5. No other Changes. (a) This Amendment modifies the Loan Agreement only as
specifically  set forth  hereinabove;  and except as modified  herein,  the Loan
Agreement  remains  unchanged and continuing in full force and effect;  (b) this
Amendment  modifies  the  Note to the  extent  and  only to the  extent  that it
replaces the First  Amendment  and removes the effect of the First  Amendment on
the Note;  and that  otherwise the Note remains  unchanged and continues in full
force and effect.

     6. Related  Documents.  This  Amendment,  and any other  documents made and
executed  by and  between,  or among,  Borrower,  Lender and  Guarantor(s),  are
included as "Related Documents", as that term is defined in the Loan Agreement.

     7. Entire Understanding.  This Amendment, the Loan Agreement, the Note, and
the Related  Documents  dated as of even date  herewith,  constitute  the entire
understanding and agreement of the parties hereto as to the matters set forth in
this Amendment;  and no alteration of or modification of this Amendment,  to the
Loan  Agreement,  or to the Note or any Related  Documents,  shall be  effective
unless given in writing, and signed by the party or parties sought to be charged
or bound by such alteration and/or modification.
<PAGE>

     8. Venue; Waiver of Trial By Jury; Choice of Law. This Amendment,  the Loan
Agreement, the Note, and the Guaranties are, and have been, made among Borrower,
Guarantors  and  Lender  in the State of New York.  If there is a  lawsuit,  the
Borrower  and  Guarantors  agree,  upon  Lender's  request,  to  submit  to  the
jurisdiction of the Courts of Oneida County, State of New York. LENDER, BORROWER
AND  GUARANTORS  HEREBY  WAIVE  THE  RIGHT  TO ANY  JURY  TRIAL  IN ANY  ACTION,
PROCEEDING OR  COUNTERCLAIM  BROUGHT BY ANY OF THEM AGAINST ANY  OTHER(S).  This
Amendment  shall be governed by and construed in accordance with the laws of the
State of New York, exclusive of law rules and public policies.

     10. Notices. All notices required to be given under this Amendment shall be
given in writing in accordance  with those same  "notice"  terms as set forth in
the Loan Agreement.

     11. Successors and Assigns. The covenants and agreements contained by or on
behalf of Borrower or  Guarantors  shall bind their  respective  successors  and
assigns,  shall  inure to the  benefit  of the  Lender,  its  successors  and/or
assigns.  Borrower and Guarantors shall not,  however,  have the right to assign
their  rights  under  this  Amendment,  the Note,  or Loan  Agreement,  or their
interests therein, without the prior written consent of the Lender.

     12. Severability.  If a court of competent jurisdiction finds any provision
of this  Amendment,  and/or  the Loan  Agreement,  and/or  the Note,  and/or any
Related  Document,   to  be  invalid  or  unenforceable  as  to  any  person  or
circumstance,   such  finding  shall  not  render  that  provision   invalid  or
unenforceable as to any other persons or  circumstances.  If feasible,  any such
offending  provision  shall be deemed to be  modified to be within the limits of
enforceability  or validity;  however,  if the offending  provision cannot be so
modified,  it shall be stricken and all other provisions of this Amendment,  the
Loan Agreement,  the Note, and the Related Documents in all other respects shall
remain valid and enforceable.

     13.  Performance.  TIME  IS OF  THE  ESSENCE  in  the  performance  of  all
requirements  set forth in this  Amendment,  in the Loan  Agreement,  and in the
Note,  including,  but not limited to,  those  requirements  which are  modified
hereby.

     14. Costs and Expenses.  Borrower and  Guarantors  shall pay the reasonable
out-of-pocket  costs  an8d  expenses  of Lender  incurred  with  respect to this
Agreement,  including, but not limited to, the reasonable fees and disbursements
of Lender's  counsel  incurred by Lender in connection  with the negotiation and
preparation of this Amendment and the other Related  Documents of even date; any
further  amendments hereto or to the Loan Agreement,  the Note, and/or the other
Related  Documents  (whether  or not of  even  date  herewith);  any  amendments
required to a  participation  agreement  existing or  concurrently  entered into
between  Lender with a participant  or  participants,  and any costs incurred in
enforcing any provision of this Amendment, the Note, the Loan Agreement, and any
related Document.
<PAGE>

     BORROWER AND EACH GUARANTOR  ACKNOWLEDGE  HAVING READ ALL THE PROVISIONS OF
THIS AMENDMENT, AND EACH AGREES TO ITS TERMS.

     IN WITNESS WHEREOF, the parties hereto execute these presents, or cause the
same to be executed by their duly  authorized  representatives,  effective as of
January 1, 2008.

                                 PAR TECHNOLOGY CORPORATION

                                 By: /s/Ronald J. Caciano
                                 -----------------------------
                                 Ronald J. Casciano, Treasurer

                                 PARTECH, INC.

                                 By: /s/Ronald J. Caciano
                                 -----------------------------
                                 Ronald J. Casciano, Treasurer

                                 PAR GOVERNMENT SYSTEMS CORPORATION

                                 By: /s/Ronald J. Caciano
                                 -----------------------------
                                 Ronald J. Casciano, Treasurer

                                 ROME RESEARCH CORPORATION

                                 By: /s/Ronald J. Caciano
                                 -----------------------------
                                 Ronald J. Casciano, Treasurer

                                 PAR SPRINGER-MILLER SYSTEMS, INC.

                                 By: /s/Ronald J. Caciano
                                 -----------------------------
                                 Ronald J. Casciano, Treasurer

                                  NBT BANK, NATIONAL ASSOCIATION


                                  By: /s/John F. Buffa
                                  -----------------------------
                                  John F. Buffa, Sr. Vice President





<PAGE>





                                   EXHIBIT 22

                   Subsidiaries of PAR Technology Corporation



-------------------------------------------------------------------------------
            Name                                   State of Incorporation
-------------------------------------------------------------------------------


ParTech, Inc. ....................................         New York

PAR Springer-Miller Systems, Inc. ................         Delaware

PAR Government Systems Corporation ...............         New York

Rome Research Corporation ........................         New York

Par Siva Corporation .............................         New York

Ausable Solutions, Inc. ..........................         Delaware

PixelPoint ULC ...................................         Canada



<PAGE>


                                   EXHIBIT 23
            Consent of Independent Registered Public Accounting Firm



The Board of Directors
PAR Technology Corporation:

We consent to the incorporation by reference in the registration statements (No.
333-119828,  33-04968,  33-39784, 33-58110, 33-63095 and 333-137647) on Form S-8
and the  registration  statement (No.  333-102197) on Form S-3 of PAR Technology
Corporation of our report dated March 17, 2008, with respect to the consolidated
balance sheets of PAR Technology Corporation and subsidiaries as of December 31,
2007  and  2006,  and  the  related   consolidated   statements  of  operations,
comprehensive income (loss), changes in shareholders' equity, and cash flows for
each of the years in the  three-year  period ended  December  31, 2007,  and the
effectiveness  of internal  control over financial  reporting as of December 31,
2007,  which report  appears in the December 31, 2007 annual report on Form 10-K
of PAR Technology Corporation.

As  discussed  in  notes  1  and 7 to  the  consolidated  financial  statements,
effective  January  1,  2006,  the  Company  adopted  the fair  value  method of
accounting  for stock based  compensation  as required by Statement of Financial
Accounting Standards No. 123(R), Share-Based Payment.


(Signed) KPMG LLP

Syracuse, New York
March 17, 2008


<PAGE>


                                  Exhibit 31.1

                                                  PAR TECHNOLOGY CORPORATION
                                                STATEMENT OF EXECUTIVE OFFICER

I, John W. Sammon, Jr., certify that:

1.   I have  reviewed  this  annual  report  on  Form  10-K  of  PAR  Technology
     Corporation;

2.   Based on my  knowledge,  this  annual  report  does not  contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this annual report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information included in this annual report,  fairly present in all material
     respects the financial  condition,  results of operations and cash flows of
     the registrant as of, and for, the periods presented in this annual report;

4.   The  registrant's  other  certifying  officer  and  I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-15(e) and 15d-15(e)),  and internal  control over
     financial  reporting  (as  defined  in  Exchange  Act Rules  13a-15(f)  and
     15d-15(f)) for the registrant and have:

     a.   Designed  such  disclosure  controls  and  procedures,  or caused such
          disclosure   controls  and   procedures  to  be  designed   under  our
          supervision,  to ensure  that  material  information  relating  to the
          registrant,  including its consolidated subsidiaries, is made known to
          us by others within those entities,  particularly during the period in
          which this report is being prepared;

     b.   Designed such internal  control over  financial  reporting,  or caused
          such internal  control over  financial  reporting to be designed under
          our  supervision,   to  provide  reasonable  assurance  regarding  the
          reliability  of financial  reporting and the  preparation of financial
          statements for external purposes in accordance with generally accepted
          accounting principles;

     c.   Evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures and presented in this report our conclusions  about the
          effectiveness of the disclosure controls and procedures, as of the end
          of the period covered by this report based on such evaluations; and

     d.   Disclosed  in this  report  any  change in the  registrant's  internal
          control over financial reporting that occurred during the registrant's
          most recent fiscal quarter (the  registrants  fourth fiscal quarter in
          the case of an annual report) and that has materially affected,  or is
          reasonably  likely to materially  affect,  the  registrant's  internal
          control over financial reporting; and

5.   The registrant's  other certifying  officer and I have disclosed,  based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee of the registrant's board
     of directors:

     a.   All significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  registrant's  ability to
          record, process, summarize and report financial information; and

     b.   Any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          control over financial reporting.


Date: March 17, 2008                           John W. Sammon, Jr.
                                               --------------------------------
                                               John W. Sammon, Jr.
                                               Chairman of the Board and
                                               Chief Executive Officer
<PAGE>


                                  Exhibit 31.2

                           PAR TECHNOLOGY CORPORATION
                         STATEMENT OF EXECUTIVE OFFICER

I, Ronald J. Casciano, certify that:

1.   I have  reviewed  this  annual  report  on  Form  10-K  of  PAR  Technology
     Corporation;

2.   Based on my  knowledge,  this  annual  report  does not  contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this annual report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information included in this annual report,  fairly present in all material
     respects the financial  condition,  results of operations and cash flows of
     the registrant as of, and for, the periods presented in this annual report;

4.   The  registrant's  other  certifying  officer  and  I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-15(e) and 15d-15(e)),  and internal  control over
     financial  reporting  (as  defined  in  Exchange  Act Rules  13a-15(f)  and
     15d-15(f)) for the registrant and have:

     a.   Designed  such  disclosure  controls  and  procedures,  or caused such
          disclosure   controls  and   procedures  to  be  designed   under  our
          supervision,  to ensure  that  material  information  relating  to the
          registrant,  including its consolidated subsidiaries, is made known to
          us by others within those entities,  particularly during the period in
          which this report is being prepared;

     b.   Designed such internal  control over  financial  reporting,  or caused
          such internal  control over  financial  reporting to be designed under
          our  supervision,   to  provide  reasonable  assurance  regarding  the
          reliability  of financial  reporting and the  preparation of financial
          statements for external purposes in accordance with generally accepted
          accounting principles;

     c.   Evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures and presented in this report our conclusions  about the
          effectiveness of the disclosure controls and procedures, as of the end
          of the period covered by this report based on such evaluations; and

     d.   Disclosed  in this  report  any  change in the  registrant's  internal
          control over financial reporting that occurred during the registrant's
          most recent fiscal quarter (the  registrants  fourth fiscal quarter in
          the case of an annual report) and that has materially affected,  or is
          reasonably  likely to materially  affect,  the  registrant's  internal
          control over financial reporting; and

5.   The registrant's  other certifying  officer and I have disclosed,  based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee of the registrant's board
     of directors:

     a.   All significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  registrant's  ability to
          record, process, summarize and report financial information; and

     b.   Any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          control over financial reporting.


Date: March 17, 2008                         Ronald J. Casciano
                                             ----------------------------------
                                             Ronald J. Casciano
                                             Vice President,
                                             Chief Financial Officer & Treasurer
<PAGE>

                                  Exhibit 32.1



                           PAR TECHNOLOGY CORPORATION
                CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


     In connection  with the Annual Report of PAR  Technology  Corporation  (the
Company)  on Form 10-K for the year ended  December  31,  2007 as filed with the
Securities and Exchange Commission on the date hereof (the Report),  we, John W.
Sammon,  Jr. and Ronald J.  Casciano,  Chairman  of the Board & Chief  Executive
Officer and Vice President,  Chief Financial Officer & Treasurer of the Company,
certify,  pursuant to 18 U.S.C.  ss. 1350, as adopted pursuant to ss. 906 of the
Sarbanes-Oxley Act of 2002, that, to the best of our knowledge:


     (1)  The Report fully  complies  with the  requirement  of section 13(a) or
          15(d) of the Securities Exchange Act of 1934, as amended; and

     (2)  The  information  contained  in the  Report  fairly  presents,  in all
          material respects,  the financial  condition and results of operations
          of the Company.






John W. Sammon, Jr.
-------------------------------
John W. Sammon, Jr.
Chairman of the Board & Chief Executive Officer
March 17, 2008

Ronald J. Casciano
--------------------------------
Ronald J. Casciano
Vice President, Chief Financial Officer & Treasurer
March 17, 2008