SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No.)
Filed by Registrant [ x ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ x ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
__________________________PAR Technology Corporation_________________________
(Name of Registrant as Specified In Its Charter)
______________________________________________________________________________
(Name of Person(s) Filing Proxy Statement if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
[ x ] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1)Title of each class of securities to which transaction applies:
_____________________.
2)Aggregate number of securities to which transaction applies:
____________________.
3)Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
_______________________________________________________.
4)Proposed maximum aggregate value of transaction: ____________________.
5)Total fee paid: _____________________________________________________.
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1)Amount Previously Paid: _________.
2)Form, Schedule or Registration Statement No.: _________.
3)Filing Party: _________.
4)Date Filed: __________.
Dr. John W. Sammon, Jr. PAR Technology Corporation
Chairman, President & Chief Executive Officer 8383 Seneca Turnpike
New Hartford, NY 13413
[GRAPHIC OMITTED]
April 23, 2002
Dear Stockholders:
It is my pleasure to invite you to PAR Technology Corporation's 2002 Annual
Meeting of Stockholders. We will hold the meeting on Thursday, May 23, 2002 at
10:00 a.m. at the Wyndham Boston Hotel, 89 Broad Street, Boston, MA 02210.
During the Annual Meeting, we will discuss each item of business described in
the Notice of Annual Meeting and Proxy Statement and give a report on the
Company's business operations. There will also be time for questions.
This booklet includes the Notice of Annual Meeting and Proxy Statement. The
Proxy Statement provides information about PAR in addition to describing the
business we will conduct at the meeting.
We hope you will be able to attend the Annual Meeting. Whether or not you expect
to attend, please vote your shares by signing, dating and returning the proxy
card in the prepaid envelope; or vote in person at the meeting.
Sincerely,
/s/John W. Sammon, Jr.
[GRAPHIC OMITTED]
PAR Technology Corporation
8383 Seneca Turnpike, New Hartford, NY 13413-4991
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON THURSDAY, MAY 23, 2002
Dear PAR Technology Shareholder:
The Annual Meeting of Shareholders of PAR Technology Corporation (the "Company")
is scheduled to be held at the Wyndham Boston Hotel, 89 Broad Street, Boston,
Massachusetts 02210 (see map on reverse of this page) on, Thursday, May 23,
2002, at 10:00 AM, local time, for the following purposes:
1. To elect one Director of the Company for a term of office to expire at
the third succeeding Annual Meeting of Shareholders;
2. To ratify the selection of PricewaterhouseCoopers LLP as the
independent accountants for the Company for the year 2002; and
3. Such other business as may properly come before the Meeting.
Only holders of record of the Company's common stock at the close of business on
April 5, 2002 will be entitled to vote at the Meeting.
Every Shareholder's vote is important. Whether or not you plan to attend the
Meeting, we request you complete, sign, date and return the enclosed proxy card
promptly so your shares will be represented. Any person giving a proxy has the
power to revoke it at any time before it is exercised and Shareholders of record
who are present at the Meeting may withdraw their proxies and vote in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/Gregory T. Cortese
Secretary
New Hartford, New York
April 23, 2002
PLEASE COMPLETE, DATE, SIGN AND RETURN PROMPTLY THE ENCLOSED PROXY IN THE
ACCOMPANYING ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES
Directions to the Wyndham Boston
89 Broad Street
Boston, Massachusetts 02110
Phone: 617-556-0006 Fax: 617-556-0053
From Logan International Airport
Follow the signs to Boston via the Sumner Tunnel (toll $2.00) At end of Tunnel
follow signs onto I-93 South Take High Street exit #23 Follow Exit # 23 onto
Oliver Street and proceed 3 blocks to Milk Street Turn right onto Milk Street
and follow 2 blocks to Broad Street Turn right onto Broad Street The Wyndham
Boston will be on your right
From Points North via I-93 South
Follow I-93 South into Boston
Take High Street exit #23
Follow Exit # 23 onto Oliver Street and proceed 3 blocks to Milk Street Turn
right onto Milk Street and follow 2 blocks to Broad Street Turn right onto Broad
Street The Wyndham Boston will be on your right
From Points South via I-93 North
Follow I-93 North into Boston Take Atlantic Avenue/Northern Avenue exit #22 Stay
left off exit and follow Atlantic Avenue After one block follow Atlantic Avenue
to the right At the second traffic light, turn left onto India Street
Follow India Street 2 blocks and turn left onto Custom House Street Turn left
onto Broad Street. The Wyndham Boston will be on your right
From Points West via I-90 East (Massachusetts Turnpike)
Follow I-90 (Mass Pike) East to the end and merge onto I-93 North Take Atlantic
Avenue/Northern Avenue exit #22 Stay left off exit and follow Atlantic Avenue
After one block follow Atlantic Avenue to the right At the second traffic light,
turn left onto India Street Follow India Street 2 blocks and turn left onto
Custom House Street Turn left onto Broad Street. The Wyndham Boston will be on
your right
[GRAPHIC OMITTED]
PAR Technology Corporation
8383 Seneca Turnpike, New Hartford, NY 13413-4991
April 23, 2002
PROXY STATEMENT
Annual Meeting of Shareholders
Thursday, May 23, 2002
The enclosed proxy is solicited by the Board of Directors of PAR Technology
Corporation (the "Company") for use at the Annual Meeting of Shareholders to be
held at 10:00 AM, local time, on May 23, 2002, and at any adjournment thereof.
Please complete, sign, date and return the enclosed proxy. When proxies in the
form enclosed are returned properly executed, the shares represented thereby
will be voted in accordance with the directions of the Shareholder. When no
direction has been given by the Shareholder, the proxy will be voted FOR the
election of the Director named below and FOR the ratification of
PricewaterhouseCoopers LLP as independent accountants for 2002. The proxy
solicited hereby may be revoked at any time prior to its exercise by executing
and returning a proxy bearing a later date, by giving written notice of
revocation to the Secretary of the Company at the address set forth above, or by
attending the Meeting and voting in person.
The cost of preparing and mailing this Notice and Proxy Statement and the
enclosed proxy will be borne by the Company. In addition to the use of the
mails, some of the officers, Directors and regular employees of the Company may
solicit proxies in person, by telephone or other electronic means and may
solicit brokers and other persons holding shares beneficially owned by others to
procure from the beneficial owners consents to the execution of proxies. The
Company will reimburse such brokers and other persons their reasonable fees and
expenses for sending solicitation material to principals and obtaining their
instructions.
The Company's Annual Report to its Shareholders for the year ended December 31,
2001, including audited financial statements, accompanies this Proxy Statement.
That report is not incorporated in this Proxy Statement by reference. The
approximate date on which this Proxy Statement and the accompanying form of
proxy are first being sent or given to security holders is April 23, 2002.
Record Date, Outstanding Common Stock, Voting Rights
Only Shareholders of record at the close of business on April 5, 2002, will be
entitled to vote at the Annual Meeting or any adjournments thereof. As of that
date, there were 7,880,760 shares of the Company's common stock outstanding and
entitled to vote. The holders of shares representing 3,940,381 votes,
represented in person or by proxy, shall constitute a quorum to conduct
business.
Each share of common stock entitles the holder thereof to one vote on all
matters to come before the Meeting including the election of the Directors.
A Shareholder may, with respect to the election of the Director: (i) vote for
the nominee named herein, or (ii) withhold authority to vote for such nominee.
The election of the Director requires a plurality of the votes cast.
Accordingly, withholding authority to vote for the Director nominee will not
prevent him from being elected.
A Shareholder may, with respect to the ratification of the selection of
PricewaterhouseCoopers LLP as independent accountants: (i) vote "FOR", (ii) vote
"AGAINST" or (iii) "ABSTAIN" from voting. A majority of the votes cast by the
holders of shares of capital stock present or represented by proxy and entitled
to vote thereon (a quorum being present) is required to ratify the selection of
independent accountants. A vote to abstain from voting on this proposal has the
legal effect of a vote against the matter.
A proxy may indicate that all or a portion of the shares represented by such
proxy are not being voted with respect to a particular matter. This could occur,
for example, when a broker or bank is not permitted to vote stock held in street
name on certain matters in the absence of instructions from the beneficial owner
of the stock. These "non-voted shares" will be considered shares not present and
entitled to vote on such matters, although such shares may be considered present
and entitled to vote for other purposes and will count for purposes of
determining the presence of a quorum. Non-voted shares will not affect the
determination of the outcome of the vote on any proposal to be decided at the
meeting.
Proposal 1: Election of Director
Under the Company's Certificate of Incorporation, the members of the Board are
divided into three classes with approximately one-third of the Directors
standing for election at each Annual Meeting of Shareholders. The Directors are
elected for a three-year term of office, and will hold office until their
respective successors have been duly elected and qualified. The class of
Directors which was elected to hold office until the 2002 Annual Meeting of
Shareholders consists of one Director. Therefore, at this meeting, one Director
will be elected for a three-year term expiring at the Annual Meeting held in
2005. Unless a contrary direction is indicated, shares represented by valid
proxies in the accompanying form will be voted FOR the election of the nominee
named below. The nominee for Director named below is currently a member of the
Board.
The Board of Directors has no reason to believe that the nominee will be unable
or unwilling to serve if elected. In the event that the nominee named below
shall become unable or unwilling to accept nomination or election as a Director,
it is intended that such shares will be voted, by the persons named in the
enclosed proxy, for the election of a substitute nominee selected by the Board,
unless the Board should determine to reduce the number of Directors pursuant to
the By-Laws of the Company.
The names of the nominee and each of the Directors, their ages as of April 23,
2002, the year each first became a Director, their principal occupations during
at least the past five years, other Directorships held by each as of the date
hereof and certain other biographical information are as set forth below by
class, in order of the next class to stand for election.
Nominee for Election to the Board of Directors
Term Expiring at the 2005 Annual Meeting of Shareholders
MR. JAMES A. SIMMS
Mr. Simms, age 42, is a Managing Director of the investment bank Adams, Harkness
& Hill, Inc. He has directed that firm's Merger's & Acquisitions Group since
1997. Mr. Simms has been a Director of the Company since October 2001.
Members of the Board of Directors Continuing in Office
Term Expiring at the 2003 Annual Meeting of Shareholders
MR. SANGWOO AHN Partner
Morgan Lewis Githens & Ahn, LP
Investment Bankers
Mr. Ahn, age 63, is one of the founders of the investment banking firm Morgan
Lewis Githens & Ahn, LP. He has held the above position since 1982. Mr. Ahn is
Chairman of the Board of Directors of Quaker Fabric Corporation. He is also a
member of the Board of Directors of Kaneb Services, Inc., Kaneb Pipeline
Partners, LP and Xanser Corp. Mr. Ahn has been a Director of the Company since
March 1986.
MR. J. WHITNEY HANEY Director
Mr. Haney, age 67, is a former President of ParTech, Inc., serving in that
capacity from 1988 to 1997. Mr. Haney retired as an employee of ParTech, Inc. in
January, 1998. Mr. Haney has been a Director of the Company since April 1988.
Term Expiring at the 2004 Annual Meeting of Shareholders
DR. JOHN W. SAMMON, JR. Chairman of the Board and President
Dr. Sammon, age 63, is the founder of the Company and has been the President and
a Director since its incorporation in 1968. He was elected Chairman of the Board
in 1983. Dr. Sammon is also a former President of ParTech, Inc. serving in that
capacity from December 1997 through June 2000 and also currently holds various
positions with other subsidiaries of the Company.
MR. CHARLES A. CONSTANTINO Executive Vice President
Mr. Constantino, age 62, has been a Director of the Company since 1970 and has
been Executive Vice President since 1974. He also holds various positions with
one or more subsidiaries of the Company.
Board of Directors and Committees
The business of the Company is under the general direction of the Board as
provided by the By-Laws of the Company and the laws of Delaware, the state of
incorporation. The Board met six times during the fiscal year ending December
31, 2001. All members of the Board attended more than 75% of the total number of
meetings of the Board and Board committees on which they served. The Board has
four standing committees: Executive, Audit, Compensation and Stock Option.
The Executive Committee. The Executive Committee is composed of three Directors:
Dr. Sammon (Chairman), Mr. Constantino and Mr. Ahn. The Executive Committee met
one time in 2001. The Executive Committee meets when required on short notice
during intervals between meetings of the Board and has authority to exercise all
of the powers of the Board in the management and direction of the business and
affairs of the Corporation in all cases in which specific directions shall not
have been given by the Board and subject to the limitations of the General
Corporation Law of the State of Delaware.
The Audit Committee. The Audit Committee consists of three Directors: Mr. Ahn
(Chairman), Mr. Haney and Mr. Simms. The Audit Committee met five times in 2001.
The functions of the Audit Committee are included in the Report of the Audit
Committee set forth below. The Board of Directors has adopted the Charter of the
Audit Committee which is attached to this Proxy Statement as Appendix I. The
members of the Audit Committee are "independent" as this term is defined by the
New York Stock Exchange in its listing standards.
The Compensation Committee. The Compensation Committee is composed of three
Directors: Mr. Ahn (Chairman), Dr. Sammon and Mr. Constantino. The Compensation
Committee met three times in 2001. The Committee, which meets as required,
reviews and establishes the compensation of the executive officers and other
principal officers of the Company and its subsidiaries. The salaries and other
compensation of any executive officers who are members of the Compensation
Committee are subject to approval by the Board. The Committee also reviews and
recommends to the Board compensation for outside Directors for service on the
Board and committees of the Board, makes recommendations to the Stock Option
Committee for stock option awards and recommends to the Board changes in the
Company's incentive plans. The Report of the Compensation Committee set forth
below describes the responsibilities of this committee, and discloses the basis
for the compensation of the Chief Executive Officer, including the factors and
criteria upon which that compensation was based; compensation policies
applicable to the Company's executive officers; and the specific relationship of
corporate performance to executive compensation for 2001.
Stock Option Committee. The Stock Option Committee is composed of two Directors:
Dr. Sammon (Chairman) and Mr. Constantino, both of whom are "disinterested
persons" within the meaning of Rule 16b-3 as promulgated under the Security
Exchange Act of 1934, as amended, and in compliance with the Company's 1995
Stock Option Plan. The Stock Option Committee met three times in 2001. The
Committee, which meets as required, reviews recommendations of the Compensation
Committee for stock option awards and otherwise serves as the administrative
body for the Stock Option Plan.
Director Compensation
Directors who are employees of the Company are not separately compensated for
serving on the Board. In 2001, outside Directors received annual retainers of
$12,000 for membership on the Board and an attendance fee of $1,500 per day for
attendance at Board meetings ($200 if attendance is via telephone) and any
Committee meetings held on the same day and $500 per day, prorated accordingly,
for Committee meetings held on days other than Board meeting days. All Directors
are also reimbursed for all reasonable expenses incurred in attending meetings.
In addition, for serving on the Board, at the time of initial election or
re-election, each non-employee Director receives a Nonqualified Stock Option to
purchase 7,500 shares of the Company's common stock at the fair market value of
the stock on the date of grant, vesting 2,500 per year over three years. From
time to time, at the Board's discretion, such non-employee Directors may be
granted additional Nonqualified Stock Options under the then existing stock
option plan(s).
CERTAIN TRANSACTIONS
AND RELATIONSHIPS
During 1999, Mr. Charles A. Constantino, a Director and an Executive Officer of
the Company, was granted loans from the Company's subsidiary, Rome Research
Corporation, with annual interest rates of 8%. The largest aggregate amount
outstanding (principal and interest) under such loans throughout 2001 was
$500,000. The principal and interest of such loans are due on demand from the
Company. As of March 31, 2002, the total principal and interest outstanding on
such loans was $500,000.
John W. Sammon, III and Karen E. Sammon, members of the immediate family of Dr.
John W. Sammon, Jr., the Company's Chairman of the Board and President, are
principals in Sammon and Sammon, LLC, doing business as Paragon Racquet Club.
Paragon Racquet Club is currently leasing a portion of the Company's facilities
at a monthly base rate of $9,775.
REPORT OF THE AUDIT COMMITTEE
The Audit Committee reports and acts on behalf of the Board of Directors by
providing oversight of the financial management, independent auditors and
financial reporting process of the Company. The Company's Management has the
primary responsibility for the financial statements and the reporting process
including the Company's system of internal controls. The independent auditors,
PricewaterhouseCoopers LLP, are responsible for auditing the Company's financial
statements and expressing an opinion on the conformity of those audited
financial statements with the generally accepted accounting principles. In
fulfilling its oversight responsibilities, the Audit Committee reviewed and
discussed the audited consolidated financial statements in the Annual Report
with management including a discussion of the quality, not just the
acceptability, of the accounting principles, the reasonableness of significant
judgments, and the clarity of disclosures in the financial statements.
The Audit Committee has reviewed and discussed with the independent auditors
their judgments as to the quality, not just the acceptability, of the Company's
accounting principles and such other matters as are required to be discussed
with the Audit Committee by Statement on Auditing Standards No. 61
(Communication with Audit Committee), as amended. In addition, the Audit
Committee has received from PricewaterhouseCoopers LLP the written disclosures
required by Independence Standards Board Standard No. 1 (Independence
Discussions with Audit Committees) and discussed the auditors' independence from
management and the Company including the matters in the written disclosures. The
Audit Committee fully considered the non-audit services provided by the
independent auditors and the fees and costs billed and expected to be billed by
the independent auditors for those services (shown below). In addition, the
Audit Committee discussed with the Company's management the procedures for
selection of consultants and the related competitive bidding practices and
considered whether those non-audit services provided by the independent auditors
are compatible with maintaining auditor independence. In reliance on the reviews
and discussions with the Company's management and the independent auditors
referred to above, the Committee believes that PricewaterhouseCoopers LLP's
provision of non-audit services is compatible with and did not impair the
independence of PricewaterhouseCoopers LLP.
The Audit Committee discussed with the Company's internal and independent
auditors the overall scope and plans for their respective audits. The Audit
Committee meets with the internal and independent auditors to discuss the
results of their examinations, their evaluations of the Company's internal
controls, and the overall quality of the Company's financial reporting. Such
meetings are held with and without the presence of management. Access to the
Audit Committee by internal and independent auditors is unrestricted.
In reliance on the reviews and discussions referred to above, the Audit
Committee recommended to the Board of Directors (and the Board has approved) the
inclusion of the audited consolidated financial statements in the Annual Report
on Form 10-K for the year ended December 31, 2001 for filing with the Securities
and Exchange Commission. The Audit Committee also recommended, and the Board
approved, subject to Shareholder ratification, the selection of
PricewaterhouseCoopers LLP as the Company's independent auditors.
Management has advised the Audit Committee that for the year ended December 31,
2001, the Company paid fees to PricewaterhouseCoopers LLP for services in the
following categories:
Audit Fees:...................................................... $ 106,000
Financial Information Systems Design and Implementation Fees:.... $ 0
All Other Fees:.................................................. $ 91,000
Audit Committee: Mr. Sangwoo Ahn (Chairman), Mr. J. Whitney Haney, Mr. James A.
Simms
SECTION 16(a) BENEFICIAL OWNERSHIP
Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and Directors, and persons who own more than 10% of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities Exchange Commission, the
New York Stock Exchange and the Company. Based solely on its review of the
copies of such reports received by the Company and written representations from
certain reporting persons that they were not required to file Form 5's, the
Company believes that during 2001 all filing requirements were timely filed
except that: one report was filed late by Mr. Charles A. Constantino, Member of
the Executive Committee, to reflect a gift made on behalf of Mr. Constantino's
wife (Elaine Constantino), which Mr. Constantino disclaims beneficial ownership
of such shares; one report was filed late by Albert Lane, Jr., an Executive
Officer, to reflect the grant of employee stock options in October 2001; one
report was filed late by Ronald J. Casciano; an Executive Officer, to reflect
the grant of employee stock options on January 2001 and October 2001; one report
was filed late by James A. Simms, a member of the Board, to reflect his initial
ownership of the Company's securities upon becoming a Director.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the ownership of
the Company's common stock as of March 31, 2002, by each Director, by each of
the Executive Officers named in the Summary Compensation Table below and by all
Directors and Executive Officers as a group. The table also sets forth
information regarding the ownership of the Company's common stock by Dimensional
Fund Advisors, Inc. based on the Schedule 13G filed by Dimensional Fund
Advisors, Inc. on January 30, 2002 with the Securities and Exchange.
Amount and Nature of Percent of
Name of Beneficial Owner or Group Beneficial Ownership (1) Class (10)
--------------------------------- ------------------------ ------------
Dr. John W. Sammon, Jr................. 3,883,300 (2) 49.28%
Charles A. Constantino................. 389,728 (3) 4.95%
Gregory T. Cortese .................... 220,790 (4) 2.73%
J. Whitney Haney....................... 164,755 (5) 2.09%
Sangwoo Ahn............................ 67,500 (6) *
Ronald J. Casciano..................... 58,800 (7) *
Albert Lane, Jr. ...................... 56,400 (8) *
James A. Simms......................... 0 *
All Directors and Executive Officers
as a Group (8 persons)................. 4,841,273 58.79%
Other Principal Beneficial Owners
Dimensional Fund Advisors, Inc. 647,200 (9) 8.38%
-----------------------------
* Represents less than 1%
(F1) Except as otherwise noted, each individual has sole voting and investment
power with respect to all shares.
(F2) Does not include 254,570 shares beneficially owned by Dr. Sammon's wife,
Deanna D. Sammon. Dr. Sammon disclaims beneficial ownership of such shares.
(F3) Does not include 800 shares owned by Mr. Constantino's wife, Elaine
Constantino. Mr. Constantino disclaims beneficial ownership of such shares.
(F4) Includes 220,250 shares which Mr. Cortese has or will have the right to
acquire pursuant to the Company's stock option plans as of May 30, 2002.
(F5) Includes 10,000 shares which Mr. Haney has or will have the right to
acquire pursuant to the Company's stock option plans as of May 30, 2002.
(F6) Includes 22,500 shares which Mr. Ahn has or will have the right to acquire
pursuant to the Company's stock option plans as of May 30, 2002.
(F7) Includes 56,400 shares which Mr. Casciano has or will have the right to
acquire pursuant to the Company's stock option plans as of May 30, 2002.
(F8) Includes 45,000 shares which Mr. Lane has or will have the right to acquire
pursuant to the Company's stock option plans as of May 30, 2002.
(F9) Information obtained from Schedule 13G filed with the Commission on January
30, 2002 by Dimensional Fund Advisors, Inc. ("Dimensional"), a registered
investment advisor. Dimensional is deemed to have beneficial ownership of
the shares all of which are owned by registered investment companies,
commingled group trusts and separate accounts ("Funds") to which
Dimensional furnishes investment advice or serves as investment manager.
Dimensional disclaims beneficial ownership of all the shares owned by the
Funds. Based on the Schedule 13G, Dimensional, in its role as investment
advisor and investment manager, possesses voting and/or investment power as
to all of the Company's shares owned by the Funds.
(F10)Percent of Class is calculated utilizing 7,880,760 which is the number of
the Company's outstanding shares as of March 31, 2002 and the number of
options held by the named beneficial owners, if any, which become
exercisable within 60 days thereafter.
The address for Dr. John W. Sammon, Jr. is c/o PAR Technology Corporation; PAR
Technology Park; 8383 Seneca Turnpike; New Hartford, NY 13413-4991. The address
for Dimensional Fund Advisors, Inc. is 1299 Ocean Avenue, 11th Floor, Santa
Monica, CA 90401.
EXECUTIVE COMPENSATION
The following table sets forth information concerning compensation for each of
the last three fiscal years awarded to, earned by, or paid to the Chief
Executive Officer and the four most highly compensated Executive Officers of the
Company other than the Chief Executive Officer.
Summary Compensation Table
Long Term
Compen-
sation
----------------------------------------------------------------
Annual Compensation Awards
----------------------------------------------------------------
Securities
Underlying All Other
Options/ Compen-
Name and Bonus SAR's (#) sation
Principal Position Year Salary (1) (2) (3)
------------------ ----------------------------------------------------------------
Dr. John W. Sammon, Jr. 2001 $ 76,837(4) $ 16,200 0 $ 0
Chairman of the Board 2000 $ 287,651 $ 0 0 $ 2,741
and Chief Executive Officer 1999 $ 279,282 $ 47,000 0 $ 7,256
Charles A. Constantino 2001 $ 238,703 $ 66,806 0 $ 0
Executive Vice President 2000 $ 235,351 $ 0 0 $ 2,741
and Director 1999 $ 228,504 $ 32,900 0 $ 7,256
Gregory T. Cortese 2001 $ 225,000 $ 40,500 0 $ 0
CEO & President, ParTech, Inc. 2000 $ 216,476 $ 0 269,000 $ 2,741
Albert Lane, Jr. 2001 $ 203,635 $ 143,200 100,000 $ 0
President, Rome Research 2000 $ 173,480 $ 78,262 0 $ 2,741
Corporation and PAR Government 1999 $ 167,570 $ 90,500 0 $ 7,256
Systems Corporation
Ronald J. Casciano 2001 $ 150,000 $ 22,500 65,400 $ 0
Vice President, C.F.O. & Treasurer 2000 $ 144,736 $ 0 15,000 $ 2,563
__________________ 1999 $ 137,103 $ 16,900 15,000 $ 6,671
(F1) Cash bonus awards earned in the respective fiscal year.
(F2) Represents stock options granted under the Company's 1995 Stock Option
Plan.
(F3) All Other Compensation column consists only of Company contributions to the
Company's Employee Retirement Plan and Trust.
(F4) Salary for Dr. Sammon was established at $291,748 for fiscal year 2001,
however, payment beyond $76,837 was not accepted or received by Dr. Sammon.
The policies and practices of the Corporation pursuant to which the compensation
set forth in the Summary Compensation Table was paid or awarded is described
under "Compensation Committee Report" set forth elsewhere in this Proxy
Statement.
Options/SAR's Granted in Last Fiscal Year
The following table shows all grants of stock options to the Executive Officers
named in the Summary Compensation Table during 2001. There were no stock
appreciation rights ("SAR's") granted in 2001.
Potential Realizable
Number of % of Total Value at Assumed Annual
Securities Options Rates of Stock Price
Underlying Granted to Exercise Appreciation for Option Term
Options/ Employees or Base ----------------------------
SAR's in Fiscal Price Expiration
Name Granted Year ($/Share) Date (1) 5%(2) 10% (2)
----------------------------------------------------------------------------------------------------------
Ronald J. Casciano 20,400 (3) 5% $1.8750 01-09-11 $ 24,055 $ 60,961
45,000 (4) 11% $2.6250 10-01-06 $ 32,636 $ 72,116
Albert Lane 100,000 (5) 25% $2.6250 10-01-06 $ 72,524 $160,259
------------------------
(F1) Options expire on the fifth or tenth anniversary of the date of the grant
as indicated. If the holder of an Option ceases, other than by reason of
death or retirement, to be employed by the Company or any subsidiary, such
Option shall terminate on the earlier of the specified expiration date or
three months from the termination date. In the case of death or retirement,
such Option shall terminate on the earlier of the specified expiration date
or the first anniversary of such death or retirement.
(F2) The dollar amounts in these columns are the result of calculations at the
5% and 10% rates set by the Securities and Exchange Commission ("SEC") and
are not intended to forecast future appreciation of the Company's stock. As
an alternative to the assumed potential realizable values stated in 5% and
10% columns, SEC rules would permit stating the present value of such
Options at the date of grant. Methods of computing present value suggested
by different authorities can produce significantly different results.
Moreover, since stock Options granted by the Company are not transferable,
there is no objective criteria by which any comparison of present value can
be verified. Consequently, the Company's management does not believe there
is a reliable method of computing the present value of such stock options.
(F3) These stock options were granted on January 9, 2001. The fair market value
of the Company's common stock on January 9, 2001 was $1.8750. These Options
vest as follows: 7,140 shares will vest on July 9, 2001 and the remaining
13,260 shares will vest on January 1, 2002.
(F4) These stock options were granted on October 1, 2001. The fair market value
of the Company's common stock on October 1, 2001 was $2.6250. These Options
vest as follows: 6,000 shares will vest on April 1, 2002, 6,000 shares will
vest on July 1, 2002 and 33,000 shares will vest quarterly until fully
vested on April 1, 2005
(F5) These stock options were granted on October 1, 2001. The fair market value
of the Company's common stock on October 1, 2001 was $2.6250. These Options
vest as follows: 17,000 shares will vest on April 1, 2002, 7,800 shares
will vest on July 1, 2002, 6,300 shares will vest on January 1, 2003, 6,300
shares will vest on April 1, 2003, 6,300 shares will vest on July 1, 2003,
6,300 shares will vest on October 1, 2003, 25,000 shares will vest
quarterly until fully vested on October 1, 2004 and 25,000 shares will vest
quarterly until fully vested shares on October 1, 2005.
Aggregated Option Exercises in 2001 and Year-End Option Values
The table which follows sets forth information concerning exercises of stock
options during 2001 by each of the Executive Officers named in the Summary
Compensation Table and the value of his unexercised Options as of December 31,
2001 based on a fair market value of $2.64 per share of the Company's common
stock on such date:
Value of Unexercised
Number of Unexercised in-the-Money
Acquired Value (1) Options at 12/31/01 Options at 12/31/01 (2)
------------------- -----------------------
Name on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
---- ------------ --------- ----------- ------------- ----------- -------------
Dr. John W. Sammon, Jr. ----- ----- ----- ----- ----- -----
Charles A. Constantino ----- ----- ----- ----- ----- -----
Gregory T. Cortese ----- ----- 197,750 146,250 $ 33,660 $ 0
Albert Lane, Jr. ----- ----- 24,000 108,000 $ 0 $ 1,500
Ronald J. Casciano ----- ----- 32,140 78,260 $ 5,462 $ 10,819
J. Whitney Haney ----- ----- 10,000 0 $ 0 $ 0
------------------
(F1) The value realized equals the aggregate amount of the excess of the fair
market value on the date of exercise (the average of the high and low
prices of the Company's common stock as reported in the Wall Street Journal
for the exercise date) over the relevant exercise price(s). (2) The value
is calculated based on the aggregate amount of the excess of $2.64 (the
fair market value of the Company's common stock on 12/31/01) over the
relevant exercise price(s).
Compensation Committee Report
The Compensation Committee of the Board of Directors (the "Committee") performs
annual reviews of the performance and contribution of the Company's executive
officers against annual and long term commitments and objectives to determine
the nature and extent of executive compensation actions. Decisions of the
Committee relative to the compensation of employee Compensation Committee
members (Dr. Sammon and Mr. Constantino) are subject to review and approval by a
majority of the disinterested members of the Board.
General Compensation Policy
The Company seeks to attract, motivate, retain and reward the management talent
essential to achieving its business objectives and maintaining its leadership
position in the industry. Compensation for the Company's executive officers in
2001 was consistent the fundamental principles of the executive compensation
program:
o Executive compensation must be tied to the Company's general
performance and achievement of financial and strategic goals;
o Executive compensation opportunities should be competitive with those
provided by other leading high technology companies of comparable
size; and
o Executive compensation should provide incentives that align the
long-term financial interests of the Company's executives with those
of its Shareholders.
Elements of Executive Compensation
To meet its policy objectives for executive compensation, the Company's
executive compensation program consists of Base Salary and Stock Options.
Base Salary. The Compensation Committee reviewed and established the annual base
salary of the executive officers for the fiscal year 2001. In setting annual
base salaries, the Compensation Committee considered the salaries of relative
executives in similar positions in the industry from its most recent contracted
survey, the level and scope of responsibility, experience and performance of the
executive, financial performance of the Company and overall general economic
factors. The Compensation Committee believes that the companies with whom the
Company competes for compensation purposes are not necessarily the same
companies with which Shareholder cumulative returns are compared. The peer
groups used in the Performance Graph below include the Standard & Poor's 500
Stock Index and those companies deemed most comparable to the Company's
businesses for measuring stock performance. An objective of the Compensation
Committee is to administer the salary for each executive management position
within a range with a midpoint near the average midpoint for comparable
positions at companies of similar size, geographic area and lines of business.
In implementing its compensation policies, the Compensation Committee also
considers the individual experience and performance of the executive, the
performance of the organization over which the executive has responsibility, the
performance of the Company and general economic conditions. The Compensation
Committee gives such weight to each factor as it deems appropriate.
Stock Options. In furtherance of the objective of providing long-term financial
incentives that relate to improvement in long-term Shareholder value, the
Company awards stock options to its key employees (including executive officers)
under the Company's 1995 Stock Option Plan ("Option Plan"). Stock options
("Options") granted under the Option Plan may be either Incentive Stock Options
as defined by the Internal Revenue Code ("Incentive Stock Options") or Options
which are not Incentive Stock Options ("Nonqualified Stock Options"). Upon
review of recommendations from the Compensation Committee, the Stock Option
Committee determines the key employees of the Company and its subsidiaries who
shall be granted Options, the type of Options to be granted, the terms of the
grant and the number of shares to be subject thereto. Option grants become
exercisable no less than six months after the grant and typically expire ten
years after the date of the grant. Option grants are discretionary and are
reflective of the value of the recipient's position as well as the current
performance and continuing contribution of that individual to the Company.
CEO Compensation for Fiscal 2001
The Compensation Committee based the 2001 compensation of the Chief Executive
Officer on the policies and practices described above. While the Compensation
Committee established the 2001 salary compensation for Dr. Sammon at $291,748,
an increase of 1.4% over his 2000 salary, Dr. Sammon refused to accept payment
of salary greater than $76,837. Dr. Sammon, the Company's founder, became a
Shareholder before the Company became publicly-owned and has not, to date, been
granted options under the Option Plan or any of the Company's previous stock
option plans in view of his already existing substantial interest in maximizing
the value of the Company's common stock. In addition, Dr. Sammon is currently
Chairman of the Stock Option Committee as a "disinterested person" and is not
eligible to receive stock option grants under the current Option Plan.
Compensation Committee
Sangwoo Ahn, Chairman
Dr. John W. Sammon, Jr.
Charles A. Constantino
Notwithstanding anything to the contrary set forth in any of the Company's
previous filings under the Securities Act of 1933 or the Securities Exchange Act
of 1934 that might incorporate by reference this Proxy Statement, in whole or in
part, the Report of the Audit Committee found earlier in this Proxy Statement,
the above Compensation Committee Report and the Performance Graph set forth
below shall not be deemed to be incorporated by reference into any filing under
the Securities Act of 1933 (the "1933 Act") or the Securities Exchange Act of
1934 (the "1934 Act"), except to the extent the Company specifically
incorporates them by reference into a filing under the 1933 Act or the 1934 Act
nor shall such Compensation Committee Report or Performance Graph be deemed to
be "soliciting material" or to be "filed" with the Securities and Exchange
Commission or subject to Regulation 14A or 14C under the 1934 Act or to the
liabilities of Section 18 of the 1934 Act, except to the extent that the Company
specifically incorporates them by reference into a filing under the 1933 Act or
the 1934 Act. As of the date of this Proxy Statement, the Company has made no
such incorporation by reference or request.
Compensation Committee Interlocks
and Insider Participation
Dr. John W. Sammon, Jr., Chairman of the Board and President of the Company and
Mr. Charles A. Constantino, Executive Vice President of the Company serve as
members of the Compensation Committee and the Stock Option Committee.
PERFORMANCE GRAPH
The following performance graph compares the cumulative total shareholder return
on the Company's common stock with the Standard & Poor's 500 Index and the
common stock of a self constructed peer group, whose returns are weighted
according to their respective market capitalizations. The graph is constructed
on the assumption that $100 was invested in each of the Company's common stock,
the S&P 500 Stock Index, and the peer group on December 31, 1996. The year-end
values of each investment are based on share price appreciation and the
reinvestment of dividends.
Cumulative Total Return
12/96 12/97 12/98 12/99 12/00 12/01
----- ----- ----- ----- ----- -----
PAR Technology Corporation.. 100 65 43 34 14 19
S&P 500..................... 100 133 171 208 189 166
Peer Group.................. 100 111 90 218 91 77
The following companies are included in the Company's self constructed Peer
Group: Aspeon, Inc. (formerly known as Javelin Systems, Inc.), Micros Systems,
Inc., PAR Technology Corporation, Radiant Systems, Inc., Tridex Corporation.
Proposal 2: Ratification of the Selection of Independent Accountants
On the recommendation of the Audit Committee, the Board of Directors has
selected PricewaterhouseCoopers LLP as the independent accountants to examine
the financial statements of the Company and its subsidiaries for the year 2002.
PricewaterhouseCoopers LLP has been employed to perform this function for the
Company since fiscal 1980.
One or more representatives of PricewaterhouseCoopers LLP will be present at the
Annual Meeting, will have an opportunity to make a statement if they so desire
and will be available to respond to appropriate questions.
Although this appointment is not required to be submitted to a vote of the
Shareholders, the Board believes it is appropriate as a matter of policy to
request that the Shareholders ratify the appointment. If the Shareholders do not
ratify the appointment, the Audit Committee will investigate the reasons for
Shareholder rejection and the Board will reconsider the appointment.
The Board of Directors recommends a vote FOR the proposal to ratify the
selection of PricewaterhouseCoopers LLP as the Company's independent accountants
for the 2002 fiscal year.
OTHER MATTERS
Other than the foregoing, the Board of Directors knows of no matters which will
be presented at the Annual Meeting for action by Shareholders. However, if any
other matters properly come before the Meeting, or any adjournment thereof, the
persons acting by authorization of the proxies will vote thereon in accordance
with their judgment.
SHAREHOLDER PROPOSALS FOR 2003 ANNUAL MEETING
Shareholders may submit proposals on matters appropriate for Shareholder action
at the Company's annual meetings consistent with the regulations adopted by the
SEC and the By-Laws of the Company. To be considered for inclusion in next
year's Proxy Statement and form of proxy relating to the 2003 Annual Meeting,
such proposals must be received at the Company's general offices no later than
the close of business December 24, 2002. If a matter of business is received by
March 9, 2003, the Company may include it in the Proxy Statement and form of
proxy and, if it does, it may use its discretionary authority to vote on the
matter. For matters that are not received by March 9, 2003, the Company may use
its discretionary voting authority when the matter is raised at the Annual
Meeting, without inclusion of the matter in its Proxy Statement. Proposals
should be addressed to Gregory T. Cortese, Secretary, PAR Technology
Corporation, PAR Technology Park, 8383 Seneca Turnpike, New Hartford, New York
13413-4991. The Company recommends all such submissions be by Certified Mail -
Return Receipt Requested.
BY ORDER OF THE BOARD OF DIRECTORS
Gregory T. Cortese
Secretary
April 23, 2002