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| Delaware                                                       | 16-1434688                              |
|----------------------------------------------------------------|-----------------------------------------|
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
| PAR Technology Park                                            |                                    |
| 8383 Seneca Turnpike                                           |                                    |
| New Hartford, New York                                         | 13413-4991                              |
| (Address of principal executive offices)                       | (Zip Code)                              |

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

| Large Accelerated Filer o                                                       | Accelerated Filer o         |
|---------------------------------------------------------------------------------|-----------------------------|
| Non Accelerated Filer  o(Do not check if a smaller reporting company) | Smaller reporting company x |

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TABLE OF CONTENTS

| Item Number         |                                                                                                                   | Page   |
|---------------------|------------------------------------------------------------------------------------------------------------------------|--------|
|                |                                                                                                                   |   |
|                | PART I                                                                                                                 |   |
| Item 1.             | Business                                                                                                               | 2      |
| Item 1A.            | Risk Factors                                                                                                           | 16     |
| Item 2.             | Properties                                                                                                             | 22     |
| Item 3.             | Legal Proceedings                                                                                                      | 22     |
| Item 4:   | RESERVED                                                                                                               | 22     |
|                |                                                                                                                   |   |
|                | PART II                                                                                                                |   |
| Item 5.             | Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 23     |
| Item 6.             | Selected Financial Data                                                                                                | 24     |
| Item 7.             | Management’s Discussion and Analysis of Financial Condition and Results of Operations                            | 25     |
| Item 7A.            | Quantitative and Qualitative Disclosures About Market Risk                                                             | 43     |
| Item 8.             | Financial Statements and Supplementary Data                                                                            | 43     |
| Item 9A.       | Controls and Procedures                                                                                                | 43     |
|                |                                                                                                                   |   |
|                | PART III                                                                                                               |   |
| Item 10.            | Directors, Executive Officers and  Corporate Governance                                                      | 45     |
| Item 11.            | Executive Compensation                                                                                                 | 45     |
| Item 12.            | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters                         | 45     |
| Item 13.            | Certain Relationships and Related Transactions, and Director Independence                                              | 45     |
| Item 14.            | Principal Accounting Fees and Services                                                                                 | 45     |
|                |                                                                                                                   |   |
|                | PART IV                                                                                                                |   |
| Item 15.            | Exhibits, Financial Statement Schedules                                                                                | 46     |
|                | Signatures                                                                                                             | 76     |

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Table of Contents

PART I

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|   | Installation and Training |
|--------|---------------------------|

|   | Maintenance and Service |
|--------|-------------------------|

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|   | Sales & Marketing |
|--------|-----------------------|

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| Employees |
|-----------|

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| ·   | the effects of adverse economic conditions in the United States and international markets, especially in light of the continued challenges in global credit and financial markets; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | changes in customer demand for our products; |
|--------------------|----------------------------------------------|

| ·   | the timing of our new product announcements or introductions, as well as those by our competitors; |
|--------------------|----------------------------------------------------------------------------------------------------|

| ·   | the level of demand and purchase orders from our customers, and our ability to adjust to changes in demand and purchase order patterns; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the ability of our third party suppliers, subcontractors and manufactures to supply us with sufficient quantities of high quality products or components, on a timely basis; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the effectiveness of our efforts to reduce product costs and manage operating expenses; |
|--------------------|-----------------------------------------------------------------------------------------|

| ·   | the ability to hire, retain and motivate qualified employees to meet the demands of our customers; |
|--------------------|----------------------------------------------------------------------------------------------------|

| ·   | intellectual property disputes; |
|--------------------|---------------------------------|

| ·   | potential significant litigation-related costs; |
|--------------------|-------------------------------------------------|

| ·   | costs related to compliance with increasing worldwide environmental and other regulations; and |
|--------------------|-----------------------------------------------------------------------------------------------------|

| ·   | the effects of public health emergencies, natural disasters, security risk, terrorist activities, international conflicts and other events beyond our control. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| ·   | the recent unprecedented volatility of the financial markets; |
|--------------------|---------------------------------------------------------------|

| ·   | uncertainty regarding the prospects of domestic and foreign economies; |
|--------------------|------------------------------------------------------------------------|

| ·   | uncertainty regarding domestic and international political conditions, including tax policies; |
|--------------------|------------------------------------------------------------------------------------------------|

| ·   | our performance and prospects; |
|--------------------|--------------------------------|

| ·   | the performance and prospects of our major customers; |
|--------------------|-------------------------------------------------------|

| ·   | investor perception of our company and the industry in which we operate; |
|--------------------|--------------------------------------------------------------------------|

| ·   | the limited availability of earnings estimates and supporting research by investment analysts; |
|--------------------|------------------------------------------------------------------------------------------------|

| ·   | the liquidity of the market for our common stock; and |
|--------------------|-------------------------------------------------------|

| ·   | the concentration of ownership of our common stock by Dr. Sammon, our Chairman of the Board and Chief Executive Officer. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------|

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| Location          | Industry  Segment               | Floor Area Principal Operations                                                                      | Number of Sq. Ft. |
|-------------------|-------------------------------------------|------------------------------------------------------------------------------------------------------|-------------------|
| New Hartford, NY  | HospitalityGovernmentLogistics Management | Principal executive offices,manufacturing, research anddevelopment laboratories,computing facilities | 140,850      |
| Rome, NY          | Government                                | Research and development                                                                             | 31,900            |
| Stowe, VT         | Hospitality                               | Sales, service and research and development                                                          | 21,300            |
| Boulder, CO       | Hospitality                               | Service                                                                                              | 20,500            |
| Boca Raton, FL    | Hospitality                               | Research and development                                                                             | 14,900            |
| Sydney, Australia | Hospitality                               | Sales and service                                                                                    | 14,000            |
| Las Vegas, NV     | Hospitality                               | Service                                                                                              | 12,000            |
| Vaughn, Canada    | Hospitality                               | Sales, service and research and development                                                          | 10,000            |
| Toronto, Canada   | Hospitality                               | Sales, service and research and development                                                          | 7,700             |

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Table of Contents

PART II

|           |   | 2010   |   |   | 2009   |   |
|----------------|--------|--------|--------|--------|--------|--------|
| Period         |   | Low    |   |   | High   |   |   | Low |   |   | High |   |
|           |   |   |   |   |   |   |   |   |   |   |   |   |
| First Quarter  |   | $      | 5.30   |   |   | $      | 6.33 |   |   | $ | 3.74 |   |   | $ | 6.03 |   |
| Second Quarter |   | $      | 5.14   |   |   | $      | 7.28 |   |   | $ | 4.84 |   |   | $ | 7.23 |   |
| Third Quarter  |   | $      | 4.69   |   |   | $      | 6.20 |   |   | $ | 5.00 |   |   | $ | 7.24 |   |
| Fourth Quarter |   | $      | 5.24   |   |   | $      | 6.92 |   |   | $ | 5.26 |   |   | $ | 6.59 |   |

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|                                  |   | Year ended December 31, |    |
|---------------------------------------|--------|-------------------------|---------|
|                                  |   | 2010                    |    |   | 2009 |   |   | 2008 |   |   | 2007 |   |   | 2006 |   |
| Net revenues                          |   | $                       | 239,939 |   |   | $ | 223,048 |   |   | $ | 232,687 |   |   | $ | 209,484 |   |   | $ | 208,667 |   |
| Cost of sales                         |   | $                       | 177,310 |   |   | $ | 177,573 |   |   | $ | 175,237 |   |   | $ | 157,576 |   |   | $ | 153,158 |   |
| Gross margin                          |   | $                       | 62,629  |   |   | $ | 45,475 |   |   | $ | 57,450 |   |   | $ | 51,908 |   |   | $ | 55,509 |   |
| Selling, general & administrative |   | $                       | 40,794  |   |   | $ | 36,207 |   |   | $ | 36,790 |   |   | $ | 37,517 |   |   | $ | 33,440 |   |
| (Provision) benefit for income taxes  |   | $                       | (1,000  | ) |   | $ | 1,314 |   |   | $ | (1,358 | ) |   | $ | 1,497 |   |   | $ | (3,146 | ) |
| Net income (loss)                     |   | $                       | 3,123   |   |   | $ | (5,186 | ) |   | $ | 2,217 |   |   | $ | (2,708 | ) |   | $ | 5,721 |   |
| Basic earnings (loss) per share       |   | $                       | .21     |   |   | $ | (.36 | ) |   | $ | .15 |   |   | $ | (.19 | ) |   | $ | .40 |   |
| Diluted earnings (loss) per share     |   | $                       | .21     |   |   | $ | (.36 | ) |   | $ | .15 |   |   | $ | (.19 | ) |   | $ | .39 |   |

|                       |   | December 31, |    |
|----------------------------|--------|--------------|---------|
|                       |   | 2010         |    |   | 2009 |   |   | 2008 |   |   | 2007 |   |   | 2006 |   |
| Current assets             |   | $            | 97,943  |   |   | $ | 92,916 |   |   | $ | 110,038 |   |   | $ | 97,879 |   |   | $ | 95,453 |   |
| Current liabilities        |   | $            | 52,057  |   |   | $ | 46,201 |   |   | $ | 59,969 |   |   | $ | 52,284 |   |   | $ | 46,473 |   |
| Total assets               |   | $            | 144,285 |   |   | $ | 136,103 |   |   | $ | 153,988 |   |   | $ | 146,518 |   |   | $ | 142,258 |   |
| Long-term debt             |   | $            | 2,744   |   |   | $ | 4,455 |   |   | $ | 5,852 |   |   | $ | 6,932 |   |   | $ | 7,708 |   |
| Shareholders’ equity |   | $            | 86,759  |   |   | $ | 83,235 |   |   | $ | 86,257 |   |   | $ | 84,987 |   |   | $ | 86,083 |   |

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|                       |   |  Total |   |   | Less Than1 Year |   |   | 1-3 Years |   |   | 3 - 5 Years |   |   | More than 5 Years |   |
|----------------------------|--------|-------------|--------|--------|-----------------|--------|--------|-----------|--------|--------|-------------|--------|--------|-------------------|--------|
| Long-term debt obligations |   | $           | 4,455  |   |            | $      | 1,711  |      |   | $      | 1,647       |   |   | $                 | 334    |   |   | $ | 763 |   |
| Operating lease            |   |        | 8,477  |   |            |   | 2,368  |      |   |   | 3,733       |   |   |              | 1,607  |   |   |   | 769 |   |
| Total                      |   | $           | 12.932 |   |            | $      | 4,079  |      |   | $      | 5,380       |   |   | $                 | 1,941  |   |   | $ | 1,532 |   |

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| 1.   | Evaluation of Disclosure Controls and Procedures. |
|----------------|---------------------------------------------------|

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| 2.   | Management’s Report on Internal Control over Financial Reporting. |
|----------------|-------------------------------------------------------------------------|

| 3.   | Changes in Internal Controls over Financial Reporting |
|----------------|-------------------------------------------------------|

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Table of Contents

PART III

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Table of Contents

PART IV

| Financial Statements:                                                                                       |   |   |   |
|-------------------------------------------------------------------------------------------------------------|--------|--------|--------|
| Report of Independent Registered Public Accounting Firm                                                     |   |   | 47     |   |
| Consolidated Balance Sheets at December 31, 2010 and 2009                                                   |   |   | 48     |   |
| Consolidated Statements of Operations for the three years endedDecember 31, 2010                            |   |   | 49     |   |
| Consolidated Statements of Comprehensive Income (Loss) for the three yearsended December 31, 2010           |   |   | 50     |   |
| Consolidated Statements of Changes in Shareholders’ Equity for the threeyears ended December 31, 2010 |   |   | 51     |   |
| Consolidated Statements of Cash Flows for the three years endedDecember 31, 2010                            |   |   | 52     |   |
| Notes to Consolidated Financial Statements                                                                  |   |   | 53     |   |

Exhibits

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|                                                                                        |   | December 31, |    |
|---------------------------------------------------------------------------------------------|--------|--------------|---------|
|                                                                                        |   | 2010         |    |   | 2009 |   |
| AssetsCurrent assets:                                                                       |   |         |    |   |   |   |
| Cash and cash equivalents                                                                   |   | $            | 6,781   |   |   | $ | 3,907 |   |
| Accounts receivable-net                                                                     |   |         | 43,517  |   |   |   | 46,107 |   |
| Inventories-net                                                                             |   |         | 38,707  |   |   |   | 32,867 |   |
| Income tax refunds                                                                          |   |         | 152     |   |   |   | 438 |   |
| Deferred income taxes                                                                       |   |         | 5,719   |   |   |   | 6,362 |   |
| Other current assets                                                                        |   |         | 3,067   |   |   |   | 3,235 |   |
| Total current assets                                                                        |   |         | 97,943  |   |   |   | 92,916 |   |
| Property, plant and equipment - net                                                         |   |         | 5,796   |   |   |   | 6,332 |   |
| Deferred income taxes                                                                       |   |         | 1,079   |   |   |   | 1,202 |   |
| Goodwill                                                                                    |   |         | 26,954  |   |   |   | 26,635 |   |
| Intangible assets - net                                                                     |   |         | 10,389  |   |   |   | 7,243 |   |
| Other assets                                                                                |   |         | 2,124   |   |   |   | 1,775 |   |
| Total Assets                                                                                |   | $            | 144,285 |   |   | $ | 136,103 |   |
| Liabilities and Shareholders’ Equity                                                  |   |         |    |   |   |   |   |   |
| Current liabilities:                                                                        |   |         |    |   |   |   |   |   |
| Current portion of long-term debt                                                           |   | $            | 1,711   |   |   | $ | 1,404 |   |
| Borrowings under lines of credit                                                            |   |         | − |   |   |   | 2,000 |   |
| Accounts payable                                                                            |   |         | 19,902  |   |   |   | 12,942 |   |
| Accrued salaries and benefits                                                               |   |         | 9,055   |   |   |   | 7,607 |   |
| Accrued expenses                                                                            |   |         | 2,843   |   |   |   | 3,868 |   |
| Customer deposits                                                                           |   |         | 2,286   |   |   |   | 1,782 |   |
| Deferred service revenue                                                                    |   |         | 16,260  |   |   |   | 16,598 |   |
| Total current liabilities                                                                   |   |         | 52,057  |   |   |   | 46,201 |   |
| Long-term debt                                                                              |   |         | 2,744   |   |   |   | 4,455 |   |
| Other long-term liabilities                                                                 |   |         | 2,725   |   |   |   | 2,212 |   |
| Shareholders’ Equity:                                                                 |   |         |    |   |   |   |   |   |
| Preferred stock, $.02 par value,                                                            |   |         |    |   |   |   |   |   |
| 1,000,000 shares authorized                                                                 |   |         | − |   |   |   | − |   |
| Common stock, $.02 par value,                                                               |   |         |    |   |   |   |   |   |
| 29,000,000 shares authorized;                                                               |   |         |    |   |   |   |   |   |
| 16,746,618 and 16,449,695 shares issued;                                                    |   |         |    |   |   |   |   |   |
|          15,039,334 and 14,796,940 outstanding |   |         | 335     |   |   |   | 329 |   |
| Capital in excess of par value                                                              |   |         | 42,264  |   |   |   | 41,382 |   |
| Retained earnings                                                                           |   |         | 50,605  |   |   |   | 47,482 |   |
| Accumulated other comprehensive loss                                                        |   |         | (613    | ) |   |   | (449 | ) |
| Treasury stock, at cost, 1,707,284 and 1,652,755 shares                                     |   |         | (5,832  | ) |   |   | (5,509 | ) |
| Total shareholders’ equity                                                            |   |         | 86,759  |   |   |   | 83,235 |   |
| Total Liabilities and Shareholders’ Equity                                            |   | $            | 144,285 |   |   | $ | 136,103 |   |

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|                                            |   | Year ended December 31, |    |
|-------------------------------------------------|--------|-------------------------|---------|
|                                            |   | 2010                    |    |   | 2009 |   |   | 2008 |   |
| Net revenues:                                   |   |                    |    |   |   |   |   |   |   |
| Product                                         |   | $                       | 101,394 |   |   | $ | 72,555 |   |   | $ | 81,763 |   |
| Service                                         |   |                    | 71,932  |   |   |   | 74,046 |   |   |   | 75,430 |   |
| Contract                                        |   |                    | 66,613  |   |   |   | 76,447 |   |   |   | 75,494 |   |
|                                            |   |                    | 239,939 |   |   |   | 223,048 |   |   |   | 232,687 |   |
| Costs of sales:                                 |   |                    |    |   |   |   |   |   |   |   |   |   |
| Product                                         |   |                    | 66,534  |   |   |   | 48,945 |   |   |   | 49,440 |   |
| Service                                         |   |                    | 48,432  |   |   |   | 56,408 |   |   |   | 54,421 |   |
| Contract                                        |   |                    | 62,344  |   |   |   | 72,220 |   |   |   | 71,376 |   |
|                                            |   |                    | 177,310 |   |   |   | 177,573 |   |   |   | 175,237 |   |
| Gross margin                                    |   |                    | 62,629  |   |   |   | 45,475 |   |   |   | 57,450 |   |
| Operating expenses:                             |   |                    |    |   |   |   |   |   |   |   |   |   |
| Selling, general and administrative             |   |                    | 40,794  |   |   |   | 36,207 |   |   |   | 36,790 |   |
| Research and development                        |   |                    | 17,061  |   |   |   | 14,196 |   |   |   | 15,295 |   |
| Amortization of identifiable intangible assets  |   |                    | 939     |   |   |   | 1,337 |   |   |   | 1,535 |   |
|                                            |   |                    | 58,794  |   |   |   | 51,740 |   |   |   | 53,620 |   |
|                                            |   |                    |    |   |   |   |   |   |   |   |   |   |
| Operating income (loss)                         |   |                    | 3,835   |   |   |   | (6,265 | ) |   |   | 3,830 |   |
| Other income, net                               |   |                    | 640     |   |   |   | 165 |   |   |   | 921 |   |
| Interest expense                                |   |                    | (352    | ) |   |   | (400 | ) |   |   | (1,176 | ) |
|                                            |   |                    |    |   |   |   |   |   |   |   |   |   |
| Income (loss) before provision for income taxes |   |                    | 4,123   |   |   |   | (6,500 | ) |   |   | 3,575 |   |
| (Provision) benefit for income taxes            |   |                    | (1,000  | ) |   |   | 1,314 |   |   |   | (1,358 | ) |
| Net income (loss)                               |   | $                       | 3,123   |   |   | $ | (5,186 | ) |   | $ | 2,217 |   |
| Earnings (loss) per share                       |   |                    |    |   |   |   |   |   |   |   |   |   |
| Basic                                           |   | $                       | .21     |   |   | $ | (.36 | ) |   | $ | .15 |   |
| Diluted                                         |   | $                       | .21     |   |   | $ | (.36 | ) |   | $ | .15 |   |
| Weighted average shares outstanding             |   |                    |    |   |   |   |   |   |   |   |   |   |
| Basic                                           |   |                    | 14,822  |   |   |   | 14,547 |   |   |   | 14,421 |   |
| Diluted                                         |   |                    | 15,008  |   |   |   | 14,547 |   |   |   | 14,761 |   |

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|                                           |   | Year ended December 31, |   |
|------------------------------------------------|--------|-------------------------|--------|
|                                           |   | 2010                    |   |   | 2009 |   |   | 2008 |   |
| Net income (loss)                              |   | $                       | 3,123  |   |   | $ | (5,186 | ) |   | $ | 2,217 |   |
| Other comprehensive income (loss), net of tax: |   |                    |   |   |   |   |   |   |   |   |   |   |
| Foreign currency translation adjustments       |   |                    | (164   | ) |   |   | 950 |   |   |   | (1,871 | ) |
| Comprehensive income (loss)                    |   | $                       | 2,959  |   |   | $ | (4,236 | ) |   | $ | 346 |   |

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|                                                        |   |         |   |   |       |   |   |      |   |   | 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 |   |
| Balances at December 31, 2007                               |   |         | 16,048 |   |       | $      | 321    |      |   | $      | 39,252        |   |   | $              | 50,451 |   |                | $      | 472 |   |   |   | (1,653 | ) |   | $ | (5,509 | ) |   | $ | 84,987 |   |
|                                                        |   |         |   |   |       |   |   |      |   |   |          |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                  |   |         |   |   |       |   |   |      |   |   |          |   |   |           | 2,217  |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   | 2,217 |   |
| Issuance of common stock upon the exercise of stock options |   |         | 92     |   |       |   | 2      |      |   |   | 526           |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   | 528 |   |
| Issuance of restricted stock awards                         |   |         | 50     |   |       |   | 1      |      |   |   |          |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   | 1 |   |
| Equity based compensation                                   |   |         |   |   |       |   |   |      |   |   | 395           |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   | 395 |   |
| Translation adjustments, net of tax of $1,239               |   |         |   |   |       |   |   |      |   |   |          |   |   |           |   |   |                |   | (1,871 | ) |   |   |   |   |   |   |   |   |   |   | (1,871 | ) |
|                                                        |   |         |   |   |       |   |   |      |   |   |          |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balances at December 31, 2008                               |   |         | 16,190 |   |       |   | 324    |      |   |   | 40,173        |   |   |           | 52,668 |   |                |   | (1,399 | ) |   |   | (1,653 | ) |   |   | (5,509 | ) |   |   | 86,257 |   |
| Net loss                                                    |   |         |   |   |       |   |   |      |   |   |          |   |   |           | (5,186 | )      |                |   |   |   |   |   |   |   |   |   |   |   |   |   | (5,186 | ) |
| Issuance of common stock upon the exercise of stock options |   |         | 192    |   |       |   | 4      |      |   |   | 543           |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   | 547 |   |
| Issuance of restricted stock awards                         |   |         | 68     |   |       |   | 1      |      |   |   |          |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   | 1 |   |
| Equity based compensation                                   |   |         |   |   |       |   |   |      |   |   | 666           |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   | 666 |   |
| Translation adjustments, net of tax of $638                 |   |         |   |   |       |   |   |      |   |   |          |   |   |           |   |   |                |   | 950 |   |   |   |   |   |   |   |   |   |   |   | 950 |   |
|                                                        |   |         |   |   |       |   |   |      |   |   |          |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balances at December 31, 2009                               |   |         | 16,450 |   |       |   | 329    |      |   |   | 41,382        |   |   |           | 47,482 |   |                |   | (449 | ) |   |   | (1,653 | ) |   |   | (5,509 | ) |   |   | 83,235 |   |
|                                                        |   |         |   |   |       |   |   |      |   |   |          |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                  |   |         |   |   |       |   |   |      |   |   |          |   |   |           | 3,123  |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   | 3,123 |   |
|                                                        |   |         |   |   |       |   |   |      |   |   |          |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance of common stock upon the exercise of stock options |   |         | 249    |   |       |   | 5      |      |   |   | 546           |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   | 551 |   |
| Issuance of restricted stock awards                         |   |         | 48     |   |       |   | 1      |      |   |   |          |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   | 1 |   |
| Equity based compensation                                   |   |         |   |   |       |   |   |      |   |   | 336           |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   | 336 |   |
| Purchase of treasury stock                                  |   |         |   |   |       |   |   |      |   |   |          |   |   |           |   |   |                |   |   |   |   |   | (54 | ) |   |   | (323 | ) |   |   | (323 | ) |
| Translation adjustments, net of tax of $ 223                |   |         |   |   |       |   |   |      |   |   |          |   |   |           |   |   |                |   | (164 | ) |   |   |   |   |   |   |   |   |   |   | (164 | ) |
|                                                        |   |         |   |   |       |   |   |      |   |   |          |   |   |           |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balances at December 31, 2010                               |   |         | 16,747 |   |       | $      | 335    |      |   | $      | 42,264        |   |   | $              | 50,605 |   |                | $      | (613 | ) |   |   | (1,707 | ) |   | $ | (5,832 | ) |   | $ | 86,759 |   |

----

|                                                                                              |   | Year ended December 31, |   |
|---------------------------------------------------------------------------------------------------|--------|-------------------------|--------|
|                                                                                              |   | 2010                    |   |   | 2009 |   |   | 2008 |   |
| Cash flows from operating activities:                                                             |   |                    |   |   |   |   |   |   |   |
| Net income (loss)                                                                                 |   | $                       | 3,123  |   |   | $ | (5,186 | ) |   | $ | 2,217 |   |
| Adjustments to reconcile net income (loss) to net cashprovided by (used in) operating activities: |   |                    |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                                     |   |                    | 3,359  |   |   |   | 3,846 |   |   |   | 4,029 |   |
| Provision for bad debts                                                                           |   |                    | 1,134  |   |   |   | 1,432 |   |   |   | 1,052 |   |
| Provision for obsolete inventory                                                                  |   |                    | 1,949  |   |   |   | 7,752 |   |   |   | 2,625 |   |
| Equity based compensation                                                                         |   |                    | 336    |   |   |   | 666 |   |   |   | 395 |   |
| Deferred income tax                                                                               |   |                    | 544    |   |   |   | (1,376 | ) |   |   | 546 |   |
| Changes in operating assets and liabilities:                                                      |   |                    |   |   |   |   |   |   |   |   |   |   |
| Accounts receivable                                                                               |   |                    | 1,449  |   |   |   | 6,339 |   |   |   | (11,026 | ) |
| Inventories                                                                                       |   |                    | (7,707 | ) |   |   | 654 |   |   |   | (3,438 | ) |
| Income tax refunds                                                                                |   |                    | 286    |   |   |   | (230 | ) |   |   | 313 |   |
| Other current assets                                                                              |   |                    | 204    |   |   |   | 411 |   |   |   | (218 | ) |
| Other assets                                                                                      |   |                    | (313   | ) |   |   | (26 | ) |   |   | 388 |   |
| Accounts payable                                                                                  |   |                    | 6,958  |   |   |   | (2,400 | ) |   |   | (1,685 | ) |
| Accrued salaries and benefits                                                                     |   |                    | 1,407  |   |   |   | (852 | ) |   |   | (1,559 | ) |
| Accrued expenses                                                                                  |   |                    | (978   | ) |   |   | (95 | ) |   |   | 204 |   |
| Customer deposits                                                                                 |   |                    | 504    |   |   |   | (4,375 | ) |   |   | 2,259 |   |
| Deferred service revenue                                                                          |   |                    | (375   | ) |   |   | 206 |   |   |   | 1,961 |   |
| Other long-term liabilities                                                                       |   |                    | 513    |   |   |   | 302 |   |   |   | (405 | ) |
| Net cash provided by (used in) operating activities                                               |   |                    | 12,393 |   |   |   | 7,068 |   |   |   | (2,342 | ) |
| Cash flows from investing activities:                                                             |   |                    |   |   |   |   |   |   |   |   |   |   |
| Capital expenditures                                                                              |   |                    | (3,838 | ) |   |   | (1,306 | ) |   |   | (1,042 | ) |
| Capitalization of software costs                                                                  |   |                    | (2,095 | ) |   |   | (845 | ) |   |   | (797 | ) |
| Contingent purchase price paid on prior year acquisitions                                         |   |                    | (33    | ) |   |   | (54 | ) |   |   | (156 | ) |
| Cash received from voluntary conversion of long-lived other assets                                |   | ─                 |   |   | ─ |   |   |   | 1,571 |   |
| Net cash used in investing activities                                                             |   |                    | (5,966 | ) |   |   | (2,205 | ) |   |   | (424 | ) |
| Cash flows from financing activities:                                                             |   |                    |   |   |   |   |   |   |   |   |   |   |
| Net borrowings (payments) under line-of-credit agreements                                         |   |                    | (2,000 | ) |   |   | (6,800 | ) |   |   | 6,300 |   |
| Payments of long-term debt                                                                        |   |                    | (1,404 | ) |   |   | (1,072 | ) |   |   | (773 | ) |
| Proceeds from the exercise of stock options                                                       |   |                    | 529    |   |   |   | 507 |   |   |   | 488 |   |
| Excess tax benefit of stock option exercises                                                      |   |                    | 22     |   |   |   | 40 |   |   |   | 41 |   |
| Purchase of treasury stock                                                                        |   |                    | (323   | ) |   | ─ |   |   | ─– |   |
| Net cash provided by (used in) financing activities                                               |   |                    | (3,176 | ) |   |   | (7,325 | ) |   |   | 6,056 |   |
| Effect of exchange rate changes on cash and cash equivalents                                      |   |                    | (377   | ) |   |   | 142 |   |   |   | (1,494 | ) |
| Net increase (decrease) in cash and cash equivalents                                              |   |                    | 2,874  |   |   |   | (2,320 | ) |   |   | 1,796 |   |
| Cash and cash equivalents at beginning of period                                                  |   |                    | 3,907  |   |   |   | 6,227 |   |   |   | 4,431 |   |
| Cash and cash equivalents at end of period                                                        |   | $                       | 6,781  |   |   | $ | 3,907 |   |   | $ | 6,227 |   |
| Supplemental disclosures of cash flow information:                                                |   |                    |   |   |   |   |   |   |   |   |   |   |
| Cash paid during the period for:                                                                  |   |                    |   |   |   |   |   |   |   |   |   |   |
| Interest                                                                                          |   | $                       | 477    |   |   | $ | 555 |   |   | $ | 873 |   |
| Income taxes, net of refunds                                                                      |   |                    | 136    |   |   |   | 333 |   |   |   | 508 |   |
| See accompanying notes to consolidated financial statements                                       |   |                    |   |   |   |   |   |   |   |   |   |   |

----

----

----

----

----

|                            |   | Year ended December 31 |   |
|---------------------------------|--------|------------------------|--------|
|                            |   | (in thousands)         |   |
|                            |   | 2010                   |   |   | 2009 |   |   | 2008 |   |
|                            |   |                   |   |   |   |   |   |   |   |
| Foreign currency gains / (loss) |   | $                      | 145    |   |   | $ | (19 | ) |   | $ | 314 |   |
| Rental income-net               |   |                   | 131    |   |   |   | 191 |   |   |   | 410 |   |
| Other                           |   |                   | 364    |   |   |   | (7 | ) |   |   | 197 |   |
|                            |   | $                      | 640    |   |   | $ | 165 |   |   | $ | 921 |   |

|                          |   | December 31,   |   |
|-------------------------------|--------|----------------|--------|
|                          |   | (in thousands) |   |
|                          |   | 2010           |   |   | 2009 |   |
|                          |   |           |   |   |   |   |
| Software costs                |   | $              | 12,161 |   |   | $ | 7,997 |   |
| Customer relationships        |   |           | 4,519  |   |   |   | 4,457 |   |
| Trademarks (non-amortizable)  |   |           | 2,750  |   |   |   | 2,731 |   |
| Other                         |   |           | 620    |   |   |   | 596 |   |
|                          |   |           | 20,050 |   |   |   | 15,781 |   |
| Less accumulated amortization |   |           | (9,661 | ) |   |   | (8,538 | ) |
|                          |   | $              | 10,389 |   |   | $ | 7,243 |   |

----

| 2011       |   | $      | 1,450 |   |
|------------|--------|--------|-------|--------|
| 2012       |   |   | 1,157 |   |
| 2013       |   |   | 720   |   |
| 2014       |   |   | 715   |   |
| 2015       |   |   | 715   |   |
| Thereafter |   |   | 2,882 |   |
|       |   | $      | 7,639 |   |

|                                                        |   | 2010   |   |   | 2009   |   |    | 2008   |   |
|-------------------------------------------------------------|--------|--------|--------|--------|--------|--------|---------|--------|--------|
| Net income (loss)                                           |   | $      | 3,123  |   |   | $      | (5,186  | )      |   | $ | 2,217 |   |
| Basic:                                                      |   |   |   |   |   |   |    |   |   |   |   |   |
| Shares outstanding at beginning of year                     |   |   | 14,677 |   |   |   | 14,471  |   |   |   | 14,372 |   |
| Weighted shares issued during the year                      |   |   | 145    |   |   |   | 76      |   |   |   | 49 |   |
| Weighted average common shares, basic                       |   |   | 14,822 |   |   |   | 14,547  |   |   |   | 14,421 |   |
| Earnings (loss) per common share, basic                     |   | $      | .21    |   |   | $      | (.36    | )      |   | $ | .15 |   |
| Diluted:                                                    |   |   |   |   |   |   |    |   |   |   |   |   |
| Weighted average common shares, basic                       |   |   | 14,822 |   |   |   | 14,547  |   |   |   | 14,421 |   |
| Weighted average shares issued during the year              |   |   | 57     |   |   |   | — |   |   |   | 65 |   |
| Dilutive impact of stock options and restrictedstock awards |   |   | 129    |   |   |   | — |   |   |   | 275 |   |
| Weighted average common shares, diluted                     |   |   | 15,008 |   |   |   | 14,547  |   |   |   | 14,761 |   |
| Earnings (loss) per common share, diluted                   |   | $      | .21    |   |   | $      | (.36    | )      |   | $ | .15 |   |

----

|                                      |   | Year ended December 31, |    |
|-------------------------------------------|--------|-------------------------|---------|
|                                      |   | 2010                    |    |   | 2009 |   |   | 2008 |   |
| Balance at beginning of year              |   | $                       | 26,635  |   |   | $ | 25,684 |   |   | $ | 26,998 |   |
| Contingent purchase price earned on prior |   |                    |    |   |   |   |   |   |   |   |   |   |
|   year acquisitions             |   |                    | — |   |   |   | 33 |   |   |   | 54 |   |
| Change in foreign exchange rates during   |   |                    |    |   |   |   |   |   |   |   |   |   |
|   the period                    |   |                    | 319     |   |   |   | 918 |   |   |   | (1,368 | ) |
| Balance at end of year                    |   | $                       | 26,954  |   |   | $ | 26,635 |   |   | $ | 25,684 |   |

----

----

----

|   | The Company’s net accounts receivable consist of: |
|--------|---------------------------------------------------------|

|                            |   | December 31,   |   |
|---------------------------------|--------|----------------|--------|
|                            |   | (in thousands) |   |
|                            |   | 2010           |   |   | 2009 |   |
| Government segment:             |   |           |   |   |   |   |
| Billed                          |   | $              | 10,622 |   |   | $ | 13,898 |   |
| Advanced billings               |   |           | (385   | ) |   |   | (572 | ) |
|                            |   |           | 10,237 |   |   |   | 13,326 |   |
| Hospitality segment:            |   |           |   |   |   |   |   |   |
| Accounts receivable – net |   |           | 32,083 |   |   |   | 31,730 |   |
|                            |   |           |   |   |   |   |   |   |
| Logistics Management segment:   |   |           |   |   |   |   |   |   |
| Accounts receivable – net |   |           | 1,197  |   |   |   | 1,051 |   |
|                            |   | $              | 43,517 |   |   | $ | 46,107 |   |

----

|            | December 31,                                |
|-----------------|---------------------------------------------|
|            | (in thousands)                              |
|            | 2010                                        |   | 2009 |
| Finished Goods  | $      13,913 |   | $       8,314 |
| Work in process | 959                                         |   | 1,462 |
| Component parts | 7,228                                       |   | 7,029 |
| Service parts   | 16,607                                      |   | 16,062 |
|            | $      38,707 |   | $     32,867 |

|                                           |   | December 31,   |    |
|------------------------------------------------|--------|----------------|---------|
|                                           |   | (in thousands) |    |
|                                           |   | 2010           |    |   | 2009 |   |
| Land                                           |   | $              | 253     |   |   | $ | 253 |   |
| Building and improvements                      |   |           | 6,111   |   |   |   | 5,984 |   |
| Rental property                                |   |           | 5,519   |   |   |   | 5,519 |   |
| Furniture and equipment                        |   |           | 22,763  |   |   |   | 22,033 |   |
|                                           |   |           | 34,646  |   |   |   | 33,789 |   |
| Less accumulated depreciation and amortization |   |           | (28,850 | ) |   |   | (27,457 | ) |
|                                           |   |           |    |   |   |   |   |   |
|                                           |   | $              | 5,796   |   |   | $ | 6,332 |   |

----

| 2011   |   | $       | 367    |   |
|--------|--------|---------|--------|--------|
| 2012   |   |    | 55     |   |
| 2013   |   |    | 54     |   |
| 2014   |   |    | 5      |   |
| 2015   |   | ─ |   |
|   |   | $       | 481    |   |

| 2011       |   | $      | 2,368 |   |
|------------|--------|--------|-------|--------|
| 2012       |   |   | 2,046 |   |
| 2013       |   |   | 1,687 |   |
| 2014       |   |   | 1,147 |   |
| 2015       |   |   | 460   |   |
| Thereafter |   |   | 769   |   |
|       |   | $      | 8,477 |   |

|   | Note 5 — Debt |
|--------|---------------------|

----

----

| 2011       |   | $      | 1,711 |   |
|------------|--------|--------|-------|--------|
| 2012       |   |   | 1,494 |   |
| 2013       |   |   | 153   |   |
| 2014       |   |   | 162   |   |
| 2015       |   |   | 172   |   |
| Thereafter |   |   | 763   |   |
|       |   | $      | 4,455 |   |

----

|                                             |   |           |   |   |             |   |   | Aggregate       |   |
|--------------------------------------------------|--------|----------------|--------|--------|------------------|--------|--------|-----------------|--------|
|                                             |   | No. of Shares  |   |   | Weighted Average |   |   | Intrinsic Value |   |
|                                             |   | (in thousands) |   |   | Exercise Price   |   |   | (in thousands)  |   |
| Outstanding at December 31, 2009                 |   |           | 989    |   |             | $      | 5.17   |            |   | $ | 603 |   |
| Options granted                                  |   |           | 25     |   |             |   | 5.65   |            |   |   |   |   |
| Exercised                                        |   |           | (249   | )      |             |   | 2.12   |            |   |   |   |   |
| Forfeited and cancelled                          |   |           | (194   | )      |             |   | 8.24   |            |   |   |   |   |
| Outstanding at December 31, 2010                 |   |           | 571    |   |             | $      | 5.47   |            |   | $ | 493 |   |
| Vested and expected to vest at December 31, 2010 |   |           | 564    |   |             | $      | 5.47   |            |   | $ | 490 |   |
|                                             |   |           |   |   |             |   |   |            |   |   |   |   |
| Total shares exercisable as of December 31, 2010 |   |           | 418    |   |             | $      | 5.51   |            |   | $ | 421 |   |
|                                             |   |           |   |   |             |   |   |            |   |   |   |   |
| Shares remaining available for grant             |   |           | 508    |   |             |   |   |            |   |   |   |   |

|                                     | 2010      | 2009      | 2008                                                                    |
|------------------------------------------|-----------|-----------|-------------------------------------------------------------------------|
| Expected option life                     | 6.0 years | 5.2 years | 6.2 years                                                               |
| Weighted average risk-free interest rate | 2.1%      | 2%        |            3.4 % |
| Weighted average expected volatility     | 52%       | 49%       |            46%   |
| Expected dividend yield                  | 0%        | 0%        |            0%    |

----

|  Range ofExercise Prices |   |   |  Number Outstanding(in thousands) |   |  Weighted Average Remaining Life |   |  Weighted Average Exercise Price |   |
|-------------------------------|--------|--------|----------------------------------------|--------|---------------------------------------|--------|---------------------------------------|--------|
|                          |   |   |                                   |   |                                  |   |                                  |   |   |   |   |   |
| $                             | 1.43   |   | ─                                |   | $                                     | 4.73   |                                  |   |   | 175 |   | 3.8 Years |   | $ | 3.04 |   |
| $                             | 4.88   |   | ─                                |   | $                                     | 6.01   |                                  |   |   | 282 |   | 6.3 Years |   | $ | 5.71 |   |
| $                             | 6.25   |   | ─                                |   | $                                     | 11.40  |                                  |   |   | 114 |   | 6.3 Years |   | $ | 8.65 |   |
| $                             | 1.43   |   | ─                                |   | $                                     | 11.40  |                                  |   |   | 571 |   | 5.51 Years |   | $ | 5.47 |   |

|  Non-vested shares (in thousands) |   |  Shares |   |   | Weighted Averagegrant-date fair value |   |
|----------------------------------------|--------|--------------|--------|--------|---------------------------------------|--------|
| Balance at January 1, 2010             |   |         | 255    |   |                                  | $      | 3.13 |   |
| Granted                                |   |         | 25     |   |                                  |   | 2.87 |   |
| Vested                                 |   |         | (71    | )      |                                  |   | 2.93 |   |
| Forfeited and cancelled                |   |         | (56    | )      |                                  |   | 4.13 |   |
| Balance at December 31, 2010           |   |         | 153    |   |                                  | $      | 2.73 |   |

----

|                                 |   | Year ended December 31, |   |
|--------------------------------------|--------|-------------------------|--------|
|                                 |   | (in thousands)          |   |
|                                 |   | 2010                    |   |   | 2009 |   |   | 2008 |   |
|                                 |   |                    |   |   |   |   |   |   |   |
| Current income tax:                  |   |                    |   |   |   |   |   |   |   |
| Federal                              |   | $                       | (263   | ) |   | $ | (960 | ) |   | $ | 49 |   |
| State                                |   |                    | 255    |   |   |   | 220 |   |   |   | 379 |   |
| Foreign                              |   |                    | 464    |   |   |   | 802 |   |   |   | 384 |   |
|                                 |   |                    | 456    |   |   |   | 62 |   |   |   | 812 |   |
| Deferred income tax:                 |   |                    |   |   |   |   |   |   |   |   |   |   |
| Federal                              |   |                    | 459    |   |   |   | (1,174 | ) |   |   | 487 |   |
| State                                |   |                    | 85     |   |   |   | (202 | ) |   |   | 59 |   |
|                                 |   |                    | 544    |   |   |   | (1,376 | ) |   |   | 546 |   |
| Provision (benefit) for income taxes |   | $                       | 1,000  |   |   | $ | (1,314 | ) |   | $ | 1,358 |   |

|                                    |   | December 31,   |    |
|-----------------------------------------|--------|----------------|---------|
|                                    |   | (in thousands) |    |
|                                    |   | 2010           |    |   | 2009 |   |
|                                    |   |           |    |   |   |   |
| Software development expense            |   | $              | 1,429   |   |   | $ | 911 |   |
| Intangible assets                       |   |           | 2,282   |   |   |   | 1,671 |   |
| Gross deferred tax liabilities          |   |           | 3,711   |   |   |   | 2,582 |   |
| Allowances for bad debts and inventory  |   |           | (5,037  | ) |   |   | (5,401 | ) |
| Capitalized inventory costs             |   |           | (92     | ) |   |   | (72 | ) |
| Employee benefit accruals               |   |           | (1,835  | ) |   |   | (1,415 | ) |
| Federal net operating loss carryforward |   |           | (1,263  | ) |   |   | (1,415 | ) |
| State net operating loss carryforward   |   |           | (321    | ) |   |   | (361 | ) |
| Tax credit carryforwards                |   |           | (2,905  | ) |   |   | (2,288 | ) |
| Foreign currency                        |   |           | (101    | ) |   |   | (324 | ) |
| Other                                   |   |           | (453    | ) |   |   | (274 | ) |
| Gross deferred tax assets               |   |           | (12,007 | ) |   |   | (11,550 | ) |
|                                    |   |           |    |   |   |   |   |   |
| Less valuation allowance                |   |           | 1,498   |   |   |   | 1,404 |   |
|                                    |   |           |    |   |   |   |   |   |
| Net deferred tax assets                 |   | $              | (6,798  | ) |   | $ | (7,564 | ) |

----

|                                 |   | Year ended December 31, |   |
|--------------------------------------|--------|-------------------------|--------|
|                                 |   | 2010                    |   |   | 2009 |   |   | 2008 |   |
| Federal statutory tax rate           |   |                    | 35.0   | % |   |   | (35.0 | )% |   |   | 35.0 | % |
| State taxes                          |   |                    | 4.4    |   |   |   | (2.1 | ) |   |   | 5.3 |   |
| Non deductible expenses              |   |                    | 2.0    |   |   |   | 1.8 |   |   |   | 9.3 |   |
| Tax credits                          |   |                    | (12.6  | ) |   |   | (2.5 | ) |   |   | (10.9 | ) |
| Foreign income tax rate differential |   |                    | (7.1   | ) |   |   | (3.3 | ) |   |   | 0.5 |   |
| Valuation allowance                  |   |                    | 2.3    |   |   |   | 21.6 |   |   | ─ |   |
| Other                                |   |                    | .5     |   |   |   | (0.7 | ) |   |   | (1.2 | ) |
|                                 |   |                    | 24.5   | % |   |   | (20.2 | )% |   |   | 38.0 | % |

----

----

|                                                      |   | Year ended December 31, |    |
|-----------------------------------------------------------|--------|-------------------------|---------|
|                                                      |   | (in thousands)          |    |
|                                                      |   | 2010                    |    |   | 2009 |   |   | 2008 |   |
|                                                      |   |                    |    |   |   |   |   |   |   |
| Revenues:                                                 |   |                    |    |   |   |   |   |   |   |
| Hospitality                                               |   | $                       | 168,958 |   |   | $ | 140,429 |   |   | $ | 157,193 |   |
| Government                                                |   |                    | 66,613  |   |   |   | 76,447 |   |   |   | 75,494 |   |
| Logistics Management                                      |   |                    | 4,368   |   |   |   | 6,172 |   |   | ─ |   |
| Total                                                     |   | $                       | 239,939 |   |   | $ | 223,048 |   |   | $ | 232,687 |   |
| Operating income (loss):                                  |   |                    |    |   |   |   |   |   |   |   |   |   |
| Hospitality                                               |   | $                       | 3,509   |   |   | $ | (9,286 | ) |   | $ | 819 |   |
| Government                                                |   |                    | 3,787   |   |   |   | 3,905 |   |   |   | 3,314 |   |
| Logistics Management                                      |   |                    | (2,986  | ) |   |   | (217 | ) |   | ─ |   |
| Other                                                     |   |                    | (475    | ) |   |   | (667 | ) |   |   | (303 | ) |
|                                                      |   |                    | 3,835   |   |   |   | (6,265 | ) |   |   | 3,830 |   |
| Other income, net                                         |   |                    | 640     |   |   |   | 165 |   |   |   | 921 |   |
| Interest expense                                          |   |                    | (352    | ) |   |   | (400 | ) |   |   | (1,176 | ) |
| Income (loss) before provision  forincome taxes |   | $                       | 4,123   |   |   | $ | (6,500 | ) |   | $ | 3,575 |   |
| Identifiable assets:                                      |   |                    |    |   |   |   |   |   |   |   |   |   |
| Hospitality                                               |   | $                       | 119,237 |   |   | $ | 109,085 |   |   | $ | 127,678 |   |
| Government                                                |   |                    | 11,627  |   |   |   | 15,097 |   |   |   | 13,532 |   |
| Logistics Management                                      |   |                    | 3,398   |   |   |   | 2,403 |   |   | ─ |   |
| Other                                                     |   |                    | 10,023  |   |   |   | 9,518 |   |   |   | 12,778 |   |
| Total                                                     |   | $                       | 144,285 |   |   | $ | 136,103 |   |   | $ | 153,988 |   |
| Goodwill:                                                 |   |                    |    |   |   |   |   |   |   |   |   |   |
| Hospitality                                               |   | $                       | 26,218  |   |   | $ | 25,899 |   |   | $ | 24,981 |   |
| Government                                                |   |                    | 736     |   |   |   | 736 |   |   |   | 703 |   |
| Total                                                     |   | $                       | 26,954  |   |   | $ | 26,635 |   |   | $ | 25,684 |   |
| Depreciation and amortization:                            |   |                    |    |   |   |   |   |   |   |   |   |   |
| Hospitality                                               |   | $                       | 2,722   |   |   | $ | 3,384 |   |   | $ | 3,567 |   |
| Government                                                |   |                    | 83      |   |   |   | 79 |   |   |   | 88 |   |
| Logistics Management                                      |   |                    | 110     |   |   |   | 10 |   |   | ─ |   |
| Other                                                     |   |                    | 444     |   |   |   | 373 |   |   |   | 374 |   |
| Total                                                     |   | $                       | 3,359   |   |   | $ | 3,846 |   |   | $ | 4,029 |   |
| Capital expenditures:                                     |   |                    |    |   |   |   |   |   |   |   |   |   |
| Hospitality                                               |   | $                       | 3,495   |   |   | $ | 1,013 |   |   | $ | 779 |   |
| Government                                                |   |                    | 96      |   |   |   | 47 |   |   |   | 22 |   |
| Logistics Management                                      |   |                    | 106     |   |   |   | 110 |   |   | ─ |   |
| Other                                                     |   |                    | 141     |   |   |   | 136 |   |   |   | 241 |   |
| Total                                                     |   | $                       | 3,838   |   |   | $ | 1,306 |   |   | $ | 1,042 |   |

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|            |   | 2010   |    |   | 2009   |   |    | 2008   |   |
|-----------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
| United States   |   | $      | 213,169 |   |   | $      | 199,569 |   |   | $ | 205,202 |   |
| Other Countries |   |   | 26,770  |   |   |   | 23,479  |   |   |   | 27,485 |   |
| Total           |   | $      | 239,939 |   |   | $      | 223,048 |   |   | $ | 232,687 |   |

|            |   | 2010   |    |   | 2009   |   |    | 2008   |   |
|-----------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
| United States   |   | $      | 133,385 |   |   | $      | 128,665 |   |   | $ | 142,461 |   |
| Other Countries |   |   | 10,900  |   |   |   | 7,438   |   |   |   | 11,527 |   |
| Total           |   | $      | 144,285 |   |   | $      | 136,103 |   |   | $ | 153,988 |   |

|                         |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Hospitality segment:         |   |   |   |   |   |   |   |   |   |
| McDonald’s Corporation |   |   | 34     | %      |   |   | 25     | %      |   |   | 24 | % |
| Yum! Brands, Inc.            |   |   | 11     | %      |   |   | 13     | %      |   |   | 16 | % |
| Government segment:          |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. Department of Defense   |   |   | 28     | %      |   |   | 34     | %      |   |   | 32 | % |
| All Others                   |   |   | 27     | %      |   |   | 28     | %      |   |   | 28 | % |
|                         |   |   | 100    | %      |   |   | 100    | %      |   |   | 100 | % |

----

----

|                       |   | Quarter ended                           |   |
|----------------------------|--------|-----------------------------------------|--------|
|                       |   | (in thousands except per share amounts) |   |
| 2010                       |   | March 31                                |   |   | June 30 |   |   | September 30 |   |   | December 31 |   |
| Net revenues               |   | $                                       | 58,119 |   |   | $ | 56,214 |   |   | $ | 61,171 |   |   | $ | 64,435 |   |
| Gross margin               |   |                                    | 14,091 |   |   |   | 15,089 |   |   |   | 16,073 |   |   |   | 17,376 |   |
| Net income                 |   |                                    | 582    |   |   |   | 849 |   |   |   | 538 |   |   |   | 1,154 |   |
| Basic earnings per share   |   |                                    | .04    |   |   |   | .06 |   |   |   | .04 |   |   |   | .08 |   |
| Diluted earnings per share |   |                                    | .04    |   |   |   | .06 |   |   |   | .04 |   |   |   | .08 |   |

|                              |   | Quarter ended                           |   |
|-----------------------------------|--------|-----------------------------------------|--------|
|                              |   | (in thousands except per share amounts) |   |
| 2009                              |   | March 31                                |   |   | June 30 |   |   | September 30 |   |   | December 31 |   |
| Net revenues                      |   | $                                       | 60,468 |   |   | $ | 54,459 |   |   | $ | 49,914 |   |   | $ | 58,207 |   |
| Gross margin                      |   |                                    | 13,687 |   |   |   | 12,362 |   |   |   | 11,405 |   |   |   | 8,021 |   |
| Net income (loss)                 |   |                                    | 247    |   |   |   | 238 |   |   |   | (778 | ) |   |   | (4,893 | ) |
| Basic earnings (loss) per share   |   |                                    | .02    |   |   |   | .02 |   |   |   | (.05 | ) |   |   | (.33 | ) |
| Diluted earnings (loss) per share |   |                                    | .02    |   |   |   | .02 |   |   |   | (.05 | ) |   |   | (.33 | ) |

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Table of Contents

SIGNATURES

|           | PAR TECHNOLOGY CORPORATION                                                                                                                                                                                                                                                                                                                                                                  |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|           |                                                                                                                                                                                                                                                                                                                                                                                        |
| March 16, 2011 | John W. Sammon, Jr.                                                             |
|           | John W. Sammon, Jr.                                                                                                                                                                                                                                                                                                                                                                         |
|           | Chairman of Board and President                                                                                                                                                                                                                                                                                                                                                             |

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

| /s/John W. Sammon, Jr.                                                                                                                                                                                                                                                                 |                                                                                                           |           |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------|----------------|
| John W. Sammon, Jr.                                                                                                                                                                                                                                                                         | Chairman of the Board and                                                                                      | March 16, 2011 |
|                                                                                                                                                                                                                                                                                        | President (Principal Executive Officer) and Director                                                      |           |
|                                                                                                                                                                                                                                                                                        |                                                                                                           |           |
| /s/Charles A. Constantino                                            |                                                                                                           |           |
| Charles A. Constantino                                                                                                                                                                                                                                                                      | Vice Chairman of the Board, Executive Vice President                                                           | March 16, 2011 |
|                                                                                                                                                                                                                                                                                        | and Director                                                                                                   |           |
|                                                                                                                                                                                                                                                                                        |                                                                                                           |           |
| /s/Sangwoo Ahn                                                                                                                                                                                                                                                                         |                                                                                                           |           |
| Sangwoo Ahn                                                                                                                                                                                                                                                                                 | Director                                                                                                       | March 16, 2011 |
|                                                                                                                                                                                                                                                                                        |                                                                                                           |           |
| /s/James A. Simms                                                    |                                                                                                           |           |
| James A. Simms                                                                                                                                                                                                                                                                              | Director                                                                                                       | March 16, 2011 |
|                                                                                                                                                                                                                                                                                        |                                                                                                           |           |
| /s/Paul D. Nielsen                                                   |                                                                                                           |           |
| Paul D. Nielsen                                                                                                                                                                                                                                                                             | Director                                                                                                       | March 16, 2011 |
|                                                                                                                                                                                                                                                                                        |                                                                                                           |           |
| /s/Kevin R. Jost                                                                                                                                                                                                                                                                       |                                                                                                           |           |
| Kevin R. Jost                                                                                                                                                                                                                                                                               | Director                                                                                                       | March 16, 2011 |
|                                                                                                                                                                                                                                                                                        |                                                                                                           |           |
| /s/Ronald J. Casciano                                                |                                                                                                           |           |
| Ronald J. Casciano                                                                                                                                                                                                                                                                          | Vice President, Chief Financial Officer, Treasurer and Chief Accounting Officer (Principal Accounting Officer) | March 16, 2011 |

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Table of Contents
List of Exhibits

| Exhibit No. | Description of Instrument                                                                                                                     |                                                                                                                                                           |
|-------------|-----------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.1         | Certificate of Incorporation, as amended                                                                                                      | Filed as Exhibit 3(i) to the quarterlyreport on Form 10Q for the periodended June 30, 2006, of PAR Technology Corporation and incorporated herein byreference. |
|        |                                                                                                                                          |                                                                                                                                                           |
| 3.3         | By-laws, as amended.                                                                                                                          | Filed as Exhibit 3.1 to RegistrationStatement on Form S-2 (RegistrationNo. 333-04077) of PAR TechnologyCorporation incorporated herein byreference.            |
|        |                                                                                                                                          |                                                                                                                                                           |
| 4           | Specimen Certificate representing the Common Stock.                                                                                           | Filed as Exhibit 3.1 to RegistrationStatement on Form S-2 (RegistrationNo. 333-04077) of PAR TechnologyCorporation incorporated herein byreference.            |
|        |                                                                                                                                          |                                                                                                                                                           |
| 10.1        | Letter of Agreement with Sandman– SCI Corporation                                                                                       | Filed as Exhibit 10.1 to Form S-3/A(Registration No. 333-102197) of PARTechnology Corporation incorporatedherein by reference.                                 |
|        |                                                                                                                                          |                                                                                                                                                           |
| 10.2        | Asset Purchase Agreement dated October 27, 2006.  By andamong PAR Technology Corporation, Par-Siva Corporation andSIVA Corporation. | Filed as Exhibit 10.1 to the current reporton Form 8K dated November 8, 2006 ofPAR Technology Corporation andincorporated 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 andincorporated herein by reference.                                                   |
|        |                                                                                                                                          |                                                                                                                                                           |
| 10.4        | 2005 Equity Incentive Plan of PAR Technology Corporation                                                                                      | Filed as Exhibit 4.2 to Form S-8(Registration No. 333-137647) of PARTechnology 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 PARTechnology Corporation and incorporatedherein by reference.                                |
|        |                                                                                                                                          |                                                                                                                                                           |
| 10.6        | Form of Restricted Stock Award Agreement                                                                                                      | Filed as Exhibit 4.4 to Form S-8(Registration No. 333-137647) of PARTechnology Corporation and incorporatedherein by reference.                                |

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| Exhibit No. | Description of Instrument                                                                                                                                                                                                                                        |                                                                                                                   |
|-------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------|
| 10.7        | February 2008 amendment to bank line of credit agreement –JP Morgan Chase                                                                                                                                                                                  | Filed as Exhibit 10.7 to Form 10-K for the year ended December 31, 2007 incorporated herein by reference.              |
|        |                                                                                                                                                                                                                                                             |                                                                                                                   |
| 10.8        | January 2008 amendment to bank line of credit agreement– NBT Bank                                                                                                                                                                                          | Filed as Exhibit 10.7 to Form 10-K for the year ended December 31, 2007 incorporated herein by reference.              |
|        |                                                                                                                                                                                                                                                             |                                                                                                                   |
| 10.9        | January 2008 amendment to bank line of credit agreement– NBT Bank                                                                                                                                                                                          | Filed as Exhibit 10.7 to Form 10-K for the year ended December 31, 2007incorporated herein by reference.               |
|        |                                                                                                                                                                                                                                                             |                                                                                                                   |
| 10.10       | Credit Agreement with JP Morgan Chase                                                                                                                                                                                                                            | Filed as Exhibit 10.1 to Form 8-K datedJune 16, 2008 of PAR TechnologyCorporation and incorporated herein byreference. |
|        |                                                                                                                                                                                                                                                             |                                                                                                                   |
| 10.11       | Pledge and Security Agreement  with JP Morgan Chase                                                                                                                                                                                                    | Filed as Exhibit 10.2 to Form 8-K datedJune 16, 2008 of PAR TechnologyCorporation and incorporated herein byreference. |
|        |                                                                                                                                                                                                                                                             |                                                                                                                   |
| 10.12       | January 2010 – amendment to bank line of credit agreement –JP Morgan Chase, N.A.; NBT Bank, N.A.; Alliance Bank, N.A.                                                                                                                                | Filed as Exhibit 10.14 to Form 10-K for the year ended December 31, 2009incorporated herein by reference.              |
|        |                                                                                                                                                                                                                                                             |                                                                                                                   |
| 10.13       | Employment Agreement Between ParTech, Inc. and A. EdwinSoladay                                                                                                                                                                                                   | Filed as Exhibit 10(iii)(A) to Form 10-Qfor the quarter ended March 31, 2009 andIncorporated herein by reference.      |
|        |                                                                                                                                                                                                                                                             |                                                                                                                   |
| 10.14       | Employment Agreement Between PAR Technology Corporationand Gregory T. Cortese.                                                                                                                                                                                   | Filed as Exhibit 10(iii)(A) to Form 10-Qfor the quarter ended September 30, 2010 and Incorporated herein by reference. |
|        |                                                                                                                                                                                                                                                             |                                                                                                                   |
| 10.15       | Employment Agreement Between PAR Technology Corporationand Ronald J. Casciano.                                                                                                                                                                                   | Filed as Exhibit 10(iii)(A) to Form 10-Kfor the year ended December 31, 2010 and Incorporated herein by reference.     |
|        |                                                                                                                                                                                                                                                             |                                                                                                                   |
| 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,Treasurer and Chief Accounting Officer 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, Treasurer and Chief Accounting Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |                                                                                                                   |

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