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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) March 30, 2005
FARO Technologies, Inc.
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(Exact name of registrant as specified in its charter)
Florida 0-23081 59-3157093
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
125 Technology Park, Lake Mary, Florida 32746
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (407) 333-9911
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(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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ITEM 2.01 COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS
ITEM 7.01 REGULATION FD DISCLOSURE
On March 29, 2005, FARO Technologies announced via press release,
subject: FARO Enters Large Scale 3D Imaging Market with Acquisition of
iQvolution AG. A copy of the press release is attached hereto.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
99.1 Press release dated as of March 29, 2005
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FARO Technologies, Inc.
(Registrant)
Date March 30, 2005
/s/ Gregory A. Fraser
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Gregory A. Fraser
Executive Vice President,
Secretary and Treasurer
Exhibit 99.1
FARO ENTERS LARGE SCALE 3D IMAGING MARKET WITH ACQUISITION OF IQVOLUTION AG
LAKE MARY, Fla., March 29 /PRNewswire-FirstCall/ -- Consistent with their
previously stated intent to enter broader three-dimensional measurement markets,
FARO Technologies, Inc. (Nasdaq: FARO) today announced that it has acquired
privately held iQvolution AG ("iQvolution"). "This acquisition represents FARO's
first step in expanding beyond the computer-aided manufacturing measurement
market to the broader computer-aided measurement market where the world of
three-dimensional measurement opportunities expands significantly," stated Simon
Raab, Chief Executive Officer of FARO.
(Logo: http://www.newscom.com/cgi-bin/prnh/20000522/FLM035LOGO )
The purchase price for the transaction is approximately $12.0 million of
which 67% is in shares of FARO common stock and 33% is in cash. All of the cash
portion of the acquisition and slightly less than half of the stock portion are
payable immediately. The remaining stock will be held in escrow and will be paid
over five years subject to achieving predetermined performance goals. Sales for
iQvolution are anticipated to be approximately $7.5 million in 2005.
"Similar to our acquisition of SMX in 2002, we expect that the combination
of iQvolution's technology and FARO's financial backing and worldwide sales and
marketing organization will create a much bigger player in this market than
iQvolution could on its own," said Jay Freeland, President & COO of FARO. "We
anticipate that this acquisition could dilute our 2005 earnings by up to $0.02
per share, but with the effectiveness of our sales network and anticipated
manufacturing and administrative synergies, we believe that the acquisition
could be accretive by the end of 2005."
iQvolution, headquartered in Ludwigsburg, Germany, manufactures and
supplies three-dimensional laser scanning products and services. Their
technology is currently used for factory planning, facility life-cycle
management, quality control, performing forensic analysis and in general,
processing large volumes of three-dimensional data. Laser scanning technology
simplifies modeling, reduces time requirements and maintains or increases the
accuracy of the image. The resulting data is used with major CAD systems or
iQvolution's own proprietary software for modeling and designing new factories
or redesigning existing layouts.
"This acquisition expands FARO's global leadership in solving three-
dimensional measurement problems," Raab added. "iQvolution's technology broadens
our portfolio of solutions. Their 'phase-based' laser scanner is approximately
100 times faster than competitors' 'time-based' scanners. Their current
phase-based model is focused on indoor use, but we intend to introduce a model
for outdoor use by early 2006. We also intend to establish new, highly
competitive price and performance levels in this rapidly expanding three
dimensional scanning market." Competitors include Cyra Technologies Inc., a
division of Leica Geosystems, RIEGL Laser Measurement Systems GmbH, Optech Inc.,
Mensi SA, and Zoller+Frohlich GmbH.
Demand in the current three-dimensional laser scanning market is driven by
the high cost of labor, scarce capital, tight schedules, and desire for reduced
project risk. Among the current customers using this application are automotive,
paper, petrochemical and mining companies as well as the U.S. Federal Bureau of
Investigation (FBI) and other law enforcement. We estimate that the total annual
three-dimensional laser scanning market today is approximately $200 million per
year. However, as costs are lowered and ease of use increases, we believe that
the estimated market could eventually be $500 million per year or more.
"We are pleased to join FARO and look forward to accelerating our growth
through the leverage of FARO's global team," said Bernd-Dietmar Becker, current
CEO and co-founder of iQvolution. "We are excited to be able to quickly
integrate with FARO Europe's offices in Stuttgart which is very close to our
offices. FARO's financial strength and global presence should provide the basis
for strong growth in the sales of our products and we are excited to provide
FARO with a new collection of high-performance three dimensional technology."
Raab concluded, "Adding iQvolution's technology to FARO's expanding array
of offerings is an important step in our ongoing search for value-added, three
dimensional measurement technologies. We look forward to the incremental growth
that we expect this acquisition will bring and we look forward to finding
additional technologies that will enhance our global presence and
customer-centric 3D solutions."
This press release 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 our plans, objectives,
projections, expectations, assumptions, strategies, or future events. 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 "may," "believes," "anticipates,"
"expects," "intends," "plans," "seeks," "estimates," "will," "should," "could,"
"projects," "forecast," and similar expressions or discussions of our strategy
or other intentions identify forward-looking statements. Other written or oral
statements, which constitute forward-looking statements, also may be made by the
Company from time to time. 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 forward-looking statements include, but are not
limited to:
* our inability to achieve sales of $7.5 million for iQvolution in 2005
as a result of various potential factors, including:
- training and ramp-up time for FARO's sales force, - the time and
expense associated with further penetrating FARO's customer base;
- the inability to expand sales of laser scanning products and
services beyond engineering applications to other opportunities,
such as law enforcement and the forensics market,
- the amount of time that it takes to fulfill orders and ship
products, and
- the length of our sales cycle to new and existing customers;
* our inability to meet the iQvolution earnings forecast contained in
this release as a result of the impact of competitive products and
pricing in the three-dimensional laser scanning market or other
factors;
* the fact that the market potential for the three-dimensional laser
scanning market and the potential adoption rate for iQvolution's
products are difficult to quantify and predict;
* development by others of new or improved products, processes or
technologies that make iQvolution's products and services obsolete or
less competitive;
* the inability to protect iQvolution's patents and other proprietary
rights and the assertion of infringement claims against us;
* our inability to introduce new products, such as a phase-based laser
scanner for outdoor use, reduce the cost of the products, or improve
the ease of use of the products;
* a decline in the overall market opportunity for the products of
iQvolution or FARO;
* the loss of Dr. Bernd-Dietmar Becker or Dr. Reinhard Becker, the co-
founders of iQvolution, or other key personnel;
* difficulties in effectively integrating iQvolution's operations,
products, technologies, and personnel with those of FARO;
* risks associated with expanding international operations, such as
fluctuations in currency exchange rates, difficulties in staffing and
managing foreign operations, and the burdens of complying with a wide
variety of foreign laws and labor practices;
* the other risks detailed in the Company's Annual Report on Form 10-K
and other filings from time to time with the Securities and Exchange
Commission.
Forward-looking statements in this release represent the Company's judgment
as of the date of this release. The Company undertakes no obligation to update
publicly any forward-looking statements, whether as a result of new information,
future events, or otherwise.
About FARO:
FARO Technologies, Inc. (Nasdaq: FARO) and its international subsidiaries
design, develop, and market software and portable, computerized measurement
devices. The Company's products allow manufacturers to perform three-
dimensional inspections of parts and assemblies on the shop floor. This helps
eliminate manufacturing errors, and thereby increases productivity and
profitability for a variety of industries in FARO's worldwide customer base.
Principal products include the FARO Gage and Gage-Plus(TM), Platinum and
Titanium model FaroArms(R), SI and X model FARO Laser Trackers(R) and a CAM2(R)
family of advanced CAD-based measurement and reporting software. FARO
Technologies is ISO 9001 certified and Guide 25 approved. Learn more at
http://www.faro.com.
SOURCE FARO Technologies, Inc.
-0- 03/29/2005
/CONTACT: Greg Fraser, EVP of FARO Technologies, Inc., +1-407-333-9911;
or Vic Allgeier of The TTC Group, +1-212-227-0997/
/Photo: NewsCom: http://www.newscom.com/cgi-bin/prnh/20000522/FLM035LOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, photodesk@prnewswire.com/
/Web site: http://www.faro.com /