Voxx International Corporation (Nasdaq: VOXX) has filed papers with the Securities and Exchange Commission (SEC) informing them that the company will be late in filing its latest Quarterly Report. It has separately notified the SEC of new “Compensatory Arrangements” with certain officers of the company. The subject of the first filing is a regular Quarterly Earnings report – which is mandated by securities regulations. The delayed report Voxx is referring to is its normal earnings report for the quarter ending November 30, 2024.
The second filing – a Form 8-K – details certain changes to the employment agreements of CEO/President Pat Lavelle, Senior VP/COO/CFO Lorianne Shelton, and Senior VP/Treasurer Charles M. Stoehr.
See why Voxx is delaying the filing of its SEC-required Quarterly report
Voxx International has submitted a Form 12b-25 to the SEC to formally notify the commission that the company’s 10-Q filing for its fiscal quarter ending on November 30, 2024, will be late. It is an extraordinary event for any public company to delay normal filings, and when so done can sometimes be interpreted as indicating a problematic situation.
Sorry SEC, We’re Too Busy Selling the Company
In the case of this particular notice to the SEC, Voxx simply explains that “…the Company has determined that it is necessary to test its goodwill, other intangible assets, and other long-lived assets for impairment.” Why is that necessary now? Simply put, it may be part of winding down of the operation in advance of its acquisition by Gentex Corporation which occurred in December 2024.
We don’t know if this is just a perfunctory process, or if something concerning has popped up, causing Gentex to question the value of Voxx and asking for it to be reviewed again before all the “t’s” are crossed and all the “i’s” are dotted on the final closing of the deal. Or it could just be that events surrounding the acquisition have just happened and the company has not had enough time to prepare these normal documents.
But Not Too Busy to Set Up Our Severance Arrangements
The separate 8-K filing largely deals with severance arrangements, principally for Lavelle and Shelton, in amendments to their employment agreements signed off on December 30, 2024. As for CEO Lavelle, in the case of a “Change of Control Event,” he will receive a $2 million severance. If, on the other hand, Lavelle stays with the company to the end of his existing contract on February 28, 2026, he will receive a severance of $1 million.
Upon Mr. Lavelle’s termination without Cause or his resignation for Good Reason, (which includes resignation one hundred eighty (180) days following the completion of a Change of Control Event), Mr. Lavelle will receive a severance payment of $2,000,000, payable monthly over two years from his separation of employment.
VOXX Int’l Form 8-K Filing, Current Events
CFO – A Change of Control ‘Bonus’ and a Severance Package
In the case of CFO Shelton, the situation is a little more convoluted as there appears to be both a change of control bonus and a separate severance. She also gets a $300,000 bonus if there is no change of control, or the ERP system she is working on is otherwise not implemented.
Ms. Shelton’s entitlement to a Change in Control Event Closing Bonus of $550,000, payable in a lump sum, is explicitly conditioned on her remaining employed through the closing of the Change of Control Event. Additionally, the payment of Ms. Shelton’s $550,000 severance due to a termination without Cause or by Ms. Shelton for Good Reason (which includes resignation following the completion of a Change of Control Event) reverts back to twelve (12) consecutive monthly payments commencing from the date of termination.
VOXX Int’l Form 8-K Filing, Current Events
Finally, in the case of Mr. Stoehr, the company tells the SEC that the existing provisions of his employment agreement stay in place, but are rewritten to be consistent with various IRC (Internal Revenue Code) requirements.
Details To Be Included in the 10-Q Filing We’re Not Making Yet
Interestingly, Voxx tells the SEC that it will file copies of all of these changes as exhibits to the upcoming Form 10-Q filing for the quarter ending November 30, 2024…that they have yet to make.
Learn more about Voxx by visiting voxxintl.com.
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