Item 1.01. Entry into a Material Definitive Agreement
Effective as of February 25, 2021, FARO Technologies, Inc. (the “Company”) entered into a settlement agreement (the “Agreement”) with the General Services Administration, an independent agency of the United States government (the “GSA”). The Agreement relates to the previously disclosed internal review and report submitted to the GSA and its Office of Inspector General setting forth the findings of the internal review conducted by the Company's outside legal counsel and forensic accountants (the “GSA Matter”) .
Pursuant to the Agreement, the Company has agreed to, among other things, pay to the GSA $12.3 million in full and final satisfaction of any and all claims, causes of actions, appeals and the like, including damages, costs, attorney's fees and interest arising under or related to the GSA Matter.
As previously disclosed in our Annual Report on Form 10-K filed February 17, 2021, the Company has recorded an aggregate total liability for the GSA Matter of $12.3 million. As it has since 2002, the Company expects to continue selling its products and related services to the United States Government under GSA Federal Supply Schedule contracts.
The foregoing description of this Agreement is qualified in its entirety by reference to the text of such Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties, such as statements about the Company’s expectations regarding its business relationship with the GSA. Statements that are not historical facts or that describe the Company's plans, objectives, projections, expectations, assumptions, strategies, or goals are forward-looking statements. In addition, words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates” or words of similar meaning or discussions of the Company’s plans or other intentions identify forward-looking statements. Forward-looking statements are not guarantees of future performance and are subject to various known and unknown risks, uncertainties, and other factors that may cause actual results, performances, or achievements to differ materially from future results, performances, or achievements expressed or implied by such forward-looking statements. Consequently, undue reliance should not be placed on these forward-looking statements.
Factors that could cause actual results to differ materially from what is expressed or forecasted in such forward- looking statements include, but are not limited to, potential loss of future government sales and potential impacts on customer and supplier relationships and on the Company's reputation that may result from the GSA Matter; development by others of new or improved products, processes or technologies that make the Company's products less competitive or obsolete; the Company's inability to maintain its technological advantage by developing new products and enhancing its existing products; declines or other adverse changes, or lack of improvement, in industries that the Company serves or the domestic and international economies in the regions of the world where the Company operates and other general economic, business, and financial conditions; and other risks detailed in Part I, Item 1A. Risk Factors in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on February 17, 2021.
Forward-looking statements in this Current Report on Form 8-K represent the Company’s judgment as of the date hereof. The Company undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise, unless otherwise required by law.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
EXHIBIT INDEX
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Exhibit
Number
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Description
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104
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Cover Page Interactive Data File - The cover page of this Current Report on Form 8-K filed on March 2, 2021, formatted in Inline XBRL
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