Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.Yes☒No☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).Yes☒No☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.:

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes☐ No ☒

Number of shares of each class of the issuer's common stock outstanding as of the latest practicable date.

	May 31, 2020			February 29, 2020			November 30, 2020			February 29, 2020
	(unaudited)						(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	69,039		$	37,425		$	21,337		$	37,425
Accounts receivable, net		55,069			69,714			155,322			69,714
Inventory		105,409			99,110			138,607			99,110
Receivables from vendors		236			230			251			230
Prepaid expenses and other current assets		11,186			10,885			17,880			10,885
Income tax receivable		442			456			454			456
Total current assets		241,381			217,820			333,851			217,820
Investment securities		1,741			2,282			1,827			2,282
Equity investment		21,284			21,924			22,182			21,924
Property, plant and equipment, net		50,705			51,424			52,124			51,424
Operating lease, right of use asset		3,175			3,143			4,811			3,143
Goodwill		55,000			55,000			58,928			55,000
Intangible assets, net		87,193			88,288			92,797			88,288
Deferred income tax assets		52			52			56			52
Other assets		1,541			1,638			1,413			1,638
Total assets	$	462,072		$	441,571		$	567,989		$	441,571
Liabilities and Stockholders' Equity
Liabilities, Redeemable Equity, and Stockholders' Equity
Current liabilities:
Accounts payable	$	32,146		$	22,096		$	80,177		$	22,096
Accrued expenses and other current liabilities		34,552			34,046			55,695			34,046
Income taxes payable		2,190			1,523			3,166			1,523
Accrued sales incentives		9,826			12,250			27,883			12,250
Contract liabilities, current								3,396			0
Current portion of long-term debt		1,116			1,107			500			1,107
Total current liabilities		79,830			71,022			170,817			71,022
Long-term debt, net of debt issuance costs		26,180			6,099			5,973			6,099
Finance lease liabilities, less current portion		594			720			386			720
Operating lease liabilities, less current portion		2,340			2,391			3,813			2,391
Contract liabilities, less current portion								1,016			0
Deferred compensation		1,741			2,282			1,827			2,282
Deferred income tax liabilities		4,477			3,828			7,975			3,828
Other tax liabilities		1,213			1,225			1,123			1,225
Other long-term liabilities		3,427			3,294			5,570			3,294
Total liabilities		119,802			90,861			198,500			90,861
Commitments and contingencies (see Note 25)
Redeemable equity (see Note 8)		2,682			2,481			2,959			2,481
Stockholders' equity:
Preferred stock:
No shares issued or outstanding (see Note 21)		—			—
NaN shares issued or outstanding (see Note 21)								0			0
Common stock:
Class A, $.01 par value, 60,000,000 shares authorized, 24,406,194 and 24,306,194 shares issued and 21,656,976 and 21,556,976 shares outstanding at May 31, 2020 and February 29, 2020, respectively		245			244
Class B Convertible, $.01 par value, 10,000,000 shares authorized, 2,260,954 shares issued and outstanding at both May 31, 2020 and February 29, 2020		22			22
Class A, $.01 par value, 60,000,000 shares authorized, 24,416,194 and 24,306,194 shares issued and 21,666,976 and 21,556,976 shares outstanding at November 30, 2020 and February 29, 2020, respectively								245			244
Class B Convertible, $.01 par value, 10,000,000 shares authorized, 2,260,954 shares issued and outstanding at both November 30, 2020 and February 29, 2020								22			22
Paid-in capital		299,579			299,228			300,107			299,228
Retained earnings		113,867			122,139			139,458			122,139
Accumulated other comprehensive loss		(18,742	)		(19,055	)		(16,046	)		(19,055	)
Less: Treasury stock, at cost, 2,749,218 shares of Class A Common Stock at both May 31 2020 and February 29, 2020		(23,918	)		(23,918	)
Less: Treasury stock, at cost, 2,749,218 shares of Class A Common Stock at both November 30, 2020 and February 29, 2020								(23,918	)		(23,918	)
Less: Redeemable equity		(2,682	)		(2,481	)		(2,959	)		(2,481	)
Total VOXX International Corporation stockholders' equity		368,371			376,179			396,909			376,179
Non-controlling interest		(28,783	)		(27,950	)		(30,379	)		(27,950	)
Total stockholders' equity		339,588			348,229			366,530			348,229
Total liabilities, redeemable equity, and stockholders' equity	$	462,072		$	441,571		$	567,989		$	441,571

	Three months ended November 30,						Nine months ended November 30,
	2020			2019			2020			2019
Net sales	$	201,065		$	110,112		$	401,084		$	293,812
Cost of sales		142,937			78,648			284,905			212,570
Gross profit		58,128			31,464			116,179			81,242
Operating expenses:
Selling		12,761			9,580			30,190			28,162
General and administrative		21,128			16,689			51,668			51,896
Engineering and technical support		5,676			5,059			14,942			15,901
Total operating expenses		39,565			31,328			96,800			95,959
Operating income (loss)		18,563			136			19,379			(14,717	)
Other (expense) income:
Interest and bank charges		(471	)		(751	)		(2,334	)		(2,635	)
Equity in income of equity investee		1,761			967			4,506			3,672
Gain on sale of real property (see Note 19)		—			4,057			—			4,057
Investment gain (see Note 4)		42			—			42			775
Other, net		(121	)		(322	)		21			1,869
Total other income, net		1,211			3,951			2,235			7,738
Income (loss) before income taxes		19,774			4,087			21,614			(6,979	)
Income tax expense		2,334			2,720			6,724			1,190
Net income (loss)		17,440			1,367			14,890			(8,169	)
Less: net loss attributable to non-controlling interest		(811	)		(1,097	)		(2,429	)		(3,521	)
Net income (loss) attributable to VOXX International Corporation	$	18,251		$	2,464		$	17,319		$	(4,648	)
Other comprehensive income (loss):
Foreign currency translation adjustments		79			(295	)		3,608			(1,321	)
Derivatives designated for hedging		(43	)		13			(514	)		(271	)
Pension plan adjustments		(6	)		2			(85	)		25
Other comprehensive income (loss), net of tax		30			(280	)		3,009			(1,567	)
Comprehensive income (loss) attributable to VOXX International Corporation	$	18,281		$	2,184		$	20,328		$	(6,215	)
Income (loss) per share - basic: Attributable to VOXX International Corporation	$	0.75		$	0.10		$	0.72		$	(0.19	)
Income (loss) per share - diluted: Attributable to VOXX International Corporation	$	0.74		$	0.10		$	0.71		$	(0.19	)
Weighted-average common shares outstanding (basic)		24,197,786			24,418,313			24,196,393			24,458,926
Weighted-average common shares outstanding (diluted)		24,677,525			24,625,410			24,532,329			24,458,926

	Class A and Class B Common Stock		Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Non- controlling Interests			Treasury Stock			Redeemable Equity			Total Stock- holders' Equity
Balances at February 29, 2020	$	266	$	299,228		$	122,139		$	(19,055	)	$	(27,950	)	$	(23,918	)	$	(2,481	)	$	348,229
Net loss		0		0			(8,272	)		0			(833	)		0			0			(9,105	)
Other comprehensive income, net of tax		0		0			0			313			0			0			0			313
Stock-based compensation expense		1		351			0			0			0			0			(201	)		151
Balances at May 31, 2020		267		299,579			113,867			(18,742	)		(28,783	)		(23,918	)		(2,682	)		339,588
Net income (loss)		0		0			7,340			0			(785	)		0			0			6,555
Other comprehensive income, net of tax		0		0			0			2,666			0			0			0			2,666
Settlement of SERP restricted stock units		0		(575	)		0			0			0			0			0			(575	)
Stock-based compensation expense		0		335			0			0			0			0			(85	)		250
Balances at August 31, 2020		267		299,339			121,207			(16,076	)		(29,568	)		(23,918	)		(2,767	)		348,484
Net income (loss)		0		0			18,251			0			(811	)		0			0			17,440
Other comprehensive income, net of tax		0		0			0			30			0			0			0			30
Stock-based compensation expense		0		768			0			0			0			0			(192	)		576
Balances at November 30, 2020	$	267	$	300,107		$	139,458		$	(16,046	)	$	(30,379	)	$	(23,918	)	$	(2,959	)	$	366,530


Balances at February 28, 2019	$	264	$	296,946		$	148,582		$	(16,944	)	$	(12,571	)	$	(21,176	)	$	0		$	395,101
Net loss		0		0			(1,148	)		0			(1,224	)		0			0			(2,372	)
Other comprehensive loss, net of tax		0		0			0			(904	)		0			0			0			(904	)
Stock-based compensation expense		0		159			0			0			0			0			0			159
Balances at May 31, 2019		264		297,105			147,434			(17,848	)		(13,795	)		(21,176	)		0			391,984
Net loss		0		0			(5,964	)		0			(1,200	)		0			0			(7,164	)
Other comprehensive loss, net of tax		0		0			0			(383	)		0			0			0			(383	)
Stock-based compensation expense		2		1,184			0			0			0			0			(1,025	)		161
Reclassifications of stockholders' equity to redeemable equity (see Note 8)		0		0			0			0			0			0			(745	)		(745	)
Repurchase of 208,312 shares of common stock		0		0			0			0			0			(983	)		0			(983	)
Balances at August 31, 2019		266		298,289			141,470			(18,231	)		(14,995	)		(22,159	)		(1,770	)		382,870
Net income (loss)		0		0			2,464			0			(1,097	)		0			0			1,367
Other comprehensive loss, net of tax		0		0			0			(280	)		0			0			0			(280	)
Stock-based compensation expense		0		471			0			0			0			0			(354	)		117
Repurchase of 218,453 shares of common stock		0		0			0			0			0			(1,057	)		0			(1,057	)
Balances at November 30, 2019	$	266	$	298,760		$	143,934		$	(18,511	)	$	(16,092	)	$	(23,216	)	$	(2,124	)	$	383,017

	Nine months ended November 30,
	2020			2019
Cash flows from operating activities:
Net income (loss)	$	14,890		$	(8,169	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization		8,224			9,229
Amortization of debt discount		508			617
Bad debt (recovery) expense		(385	)		303
Reduction in the carrying amount of the right of use asset		836			668
Loss (gain) on forward contracts		61			(347	)
Equity in income of equity investees		(4,506	)		(3,672	)
Distribution of income from equity investees		4,248			4,169
Deferred income tax expense (benefit)		4,187			(338	)
Non-cash compensation adjustment		(455	)		(51	)
Stock based compensation expense		1,454			1,816
Gain on sale of property, plant, and equipment		—			(3,788	)
Changes in operating assets and liabilities:
Accounts receivable		(78,692	)		(20,880	)
Inventory		(31,406	)		(9,353	)
Receivables from vendors		(19	)		790
Prepaid expenses and other		(6,465	)		528
Investment securities-trading		455			304
Accounts payable, accrued expenses, accrued sales incentives, contract liabilities, and other liabilities		83,049			3,379
Income taxes payable		1,388			908
Net cash used in operating activities		(2,628	)		(23,887	)
Cash flows from investing activities:
Purchases of property, plant, and equipment		(3,510	)		(2,192	)
Purchase of acquired business, less cash received		(11,000	)		—
Proceeds from sale of property, plant, and equipment		—			11,951
Net cash (used in) provided by investing activities		(14,510	)		9,759
Cash flows from financing activities:
Principal payments on finance lease obligation		(470	)		(477	)
Repayment of bank obligations		(20,375	)		(9,046	)
Borrowings on bank obligations		20,000			—
Deferred financing costs		(260	)		—
Settlement of restricted stock units		(575	)		—
Purchase of treasury stock		—			(2,040	)
Net cash used in financing activities		(1,680	)		(11,563	)
Effect of exchange rate changes on cash		2,730			(389	)
Net decrease in cash and cash equivalents		(16,088	)		(26,080	)
Cash and cash equivalents at beginning of period		37,425			58,236
Cash and cash equivalents at end of period	$	21,337		$	32,156

~~Unaudited Consolidated Statements of Operations and Comprehensive (Loss) Income~~

Three months ended
May 31,

2020

2019

Net sales

$
71,987

$
93,454

Cost of sales

52,012

67,445

Gross profit

19,975

26,009

Operating expenses:

Selling

8,362

9,881

General and administrative

14,995

17,425

Engineering and technical support

4,485

5,807

Total operating expenses

27,842

33,113

Operating loss

(7,867
)

(7,104
)
Other (expense) income:

Interest and bank charges

(853
)

(997
)
Equity in income of equity investee

862

1,440

Other, net

534

1,644

Total other income, net

543

2,087

Loss before income taxes

(7,324
)

(5,017
)
Income tax expense (benefit)

1,781

(2,645
)
Net loss

(9,105
)

(2,372
)
Less: net loss attributable to non-controlling interest

(833
)

(1,224
)
Net loss attributable to VOXX International Corporation

$
(8,272
)

$
(1,148
)
Other comprehensive income (loss):

Foreign currency translation adjustments

504

(811
)
Derivatives designated for hedging

(177
)

(107
)
Pension plan adjustments

(14
)

14

Other comprehensive income (loss), net of tax

313

(904
)
Comprehensive loss attributable to VOXX International Corporation

$
(7,959
)

$
(2,052
)
Loss per share - basic: Attributable to VOXX International Corporation

$
(0.34
)

$
(0.05
)
Loss per share - diluted: Attributable to VOXX International Corporation

$
(0.34
)

$
(0.05
)
Weighted-average common shares outstanding (basic)

24,224,478

24,355,791

Weighted-average common shares outstanding (diluted)

24,224,478

24,355,791

Class A
and Class B
Common
Stock

Paid-in
Capital

Retained
Earnings

Accumulated
Other
Comprehensive
Loss

Non-
controlling
Interests

Treasury
Stock

Redeemable Equity

Total
Stock-
holders'
Equity

Balances at February 29, 2020

$
266

$
299,228

$
122,139

$
(19,055
)

$
(27,950
)

$
(23,918
)

$
(2,481
)

$
348,229

Net loss

—

—

(8,272
)

—

(833
)

—

—

(9,105
)
Other comprehensive income, net of tax

—

—

—

313

—

—

—

313

Stock-based compensation expense

1

351

—

—

—

—

(201
)

151

Balances at May 31, 2020

$
267

$
299,579

$
113,867

$
(18,742
)

$
(28,783
)

$
(23,918
)

$
(2,682
)

$
339,588

Balances at February 28, 2019

$
264

$
296,946

$
148,582

$
(16,944
)

$
(12,571
)

$
(21,176
)

$
-

$
395,101

Net loss

—

—

(1,148
)

—

(1,224
)

—

—

(2,372
)
Other comprehensive loss, net of tax

—

—

—

(904
)

—

—

—

(904
)
Stock-based compensation expense

—

159

—

—

—

—

—

159

Balances at May 31, 2019

$
264

$
297,105

$
147,434

$
(17,848
)

$
(13,795
)

$
(21,176
)

$
-

$
391,984

Three months ended
May 31,

2020

2019

Cash flows from operating activities:

Net loss

$
(9,105
)

$
(2,372
)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Depreciation and amortization

2,543

3,067

Amortization of debt discount

206

206

Bad debt (recovery) expense

(7
)

52

Reduction in the carrying amount of the right of use asset

243

225

Gain on forward contracts

(67
)

(107
)
Equity in income of equity investees

(862
)

(1,440
)
Distribution of income from equity investees

1,502

1,472

Deferred income tax expense (benefit)

644

(1,154
)
Non-cash compensation adjustment

(541
)

326

Stock based compensation expense

351

159

(Gain) loss on sale of property, plant and equipment

—

1

Changes in operating assets and liabilities:

Accounts receivable

14,842

11,401

Inventory

(6,059
)

(1,278
)
Receivables from vendors

(4
)

462

Prepaid expenses and other

(255
)

1,099

Investment securities-trading

541

(136
)
Accounts payable, accrued expenses, accrued sales incentives and other liabilities

7,638

(6,502
)
Income taxes payable

675

(1,213
)
Net cash provided by operating activities

12,285

4,268

Cash flows used in investing activities:

Purchases of property, plant and equipment

(586
)

(703
)
Net cash used in investing activities

(586
)

(703
)
Cash flows provided by (used in) financing activities:

Principal payments on finance lease obligation

(169
)

(108
)
Repayment of bank obligations

(125
)

(1,428
)
Borrowings on bank obligations

20,000

—

Net cash provided by (used in) financing activities

19,706

(1,536
)
Effect of exchange rate changes on cash

209

(261
)
Net increase in cash and cash equivalents

31,614

1,768

Cash and cash equivalents at beginning of period

37,425

58,236

Cash and cash equivalents at end of period

$
69,039

$
60,004

The accompanying unaudited interim consolidated financial statements of VOXX International Corporation and Subsidiaries ("Voxx" or the "Company") have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission as defined in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 270 for interim financial information, and in accordance with accounting principles generally accepted in the United States of America (“GAAP”), and include all adjustments (consisting of normal recurring adjustments), which, in the opinion of management, are necessary to present fairly the consolidated financial position, results of operations, changes in stockholders’ equity, and cash flows for all periods presented. The results of operations are not necessarily indicative of the results to be expected for the full fiscal year or any interim period. These unaudited consolidated financial statements do not include all disclosures associated with consolidated financial statements prepared in accordance with ~~accounting principles generally accepted in the United States of America.~~GAAP. Accordingly, these statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto contained in the Company's Form 10-K for the fiscal year ended February 29, 2020. Certain amounts in the prior year have been reclassified to conform to the current year presentation.

We operate in ~~three~~3 reportable segments: Automotive Electronics, Consumer Electronics, and Biometrics. See Note 23 for the Company's segment reporting disclosures.

On July 1, 2020, the Company completed the acquisition of certain assets and liabilities, which comprise the aftermarket vehicle remote start and security systems and connected car solutions (telematics) businesses of Directed LLC and Directed Electronics Canada Inc. (collectively, with Directed LLC, “Directed”) via an asset purchase agreement. The acquired assets include inventory, accounts receivable, certain fixed assets, IT systems, and intellectual property. The cash purchase price was $11,000. Net sales from the Company’s newly formed subsidiaries, VOXX DEI LLC and VOXX DEI Canada, Ltd. (collectively, with VOXX DEI LLC, “DEI”), included in our consolidated results for the three and nine months ended November 30, 2020 represented approximately 11.8% and 7.1%, respectively, of our consolidated net sales. DEI’s results of operations are included in the consolidated financial statements of Voxx in our Automotive Electronics segment. The purpose of this acquisition was to expand the Company’s market share within the automotive electronics industry.

The following summarizes the allocation of the purchase price based upon the fair value of the assets acquired and liabilities assumed at the date of acquisition:

	July 1, 2020		Measurement Period Adjustments			July 1, 2020 (as adjusted)
Assets acquired:
Inventory	$	7,054		-			7,054
Accounts receivable		5,173		67			5,240
Other current assets		160		-			160
Property and equipment		2,815		-			2,815
Operating lease, right of use asset		1,771		-			1,771
Customer relationships		2,600		(100	)		2,500
Trademarks		4,500		-			4,500
Patented technology		1,030		-			1,030
Goodwill		3,290		55			3,345
Total assets acquired	$	28,393	$	22		$	28,415

Liabilities assumed:
Accounts payable		8,144		-			8,144
Accrued expenses		1,406		11			1,417
Contract liabilities		4,872		11			4,883
Warranty accrual		1,200		-			1,200
Operating lease liability		1,771		-			1,771
Total	$	17,393	$	22		$	17,415
Total purchase price	$	11,000	$	-		$	11,000

The purchase allocation presented above is preliminary. We are in the process of refining the valuation of acquired assets and liabilities, including goodwill, and expect to finalize the purchase price allocation prior to June 30, 2021. During the three and nine months ended November 30, 2020, the Company recorded a cumulative net measurement period adjustment that increased goodwill by $55, as presented in the table above. The measurement period adjustment would have resulted in an insignificant decrease in amortization expense related to the customer relationships in the previous quarter. The Company made these measurement period adjustments to reflect facts and circumstances that existed as of the acquisition date and did not result from intervening events subsequent to such date. Goodwill was determined as the excess of the purchase price over the fair value of the assets acquired (including the identifiable intangible assets) and represents synergies expected.

On January 31, 2020, the Company acquired certain assets and liabilities of Vehicle Safety Holdings Corp. (“VSHC”) via an asset purchase agreement for a preliminary purchase price of $16,610, which included $16,500 in cash and contingent consideration with a fair value of $110. Contingent consideration of up to a maximum of $750 is payable based upon the achievement of specified operating results, or the occurrence of certain events over the twelve-month period following the completion of the acquisition. Net sales from ~~VSHC~~the Company’s newly formed subsidiary, VSM-Rostra, LLC (“VSM”) included in our consolidated results for the three and nine months ended ~~May 31,~~November 30, 2020 represented approximately 7%3.2% and 4.3% of our consolidated net ~~sales. VSHC’s~~sales, respectively. VSM’s results of operations are included in the consolidated financial statements of Voxx in our Automotive Electronics segment. The purpose of this acquisition was to expand the Company’s product offerings and market share, as ~~VSHC~~VSM is a leading developer, manufacturer, and distributor of safety electronics.

The following summarizes the allocation of the purchase price based upon the fair value of the assets acquired and liabilities assumed at the date of acquisition:

	January 31, 2020		January 31, 2020		Measurement Period Adjustments			January 31, 2020 (as adjusted)
Assets acquired:
Inventory	$	6,982	$	6,982		(489	)		6,493
Accounts receivable		3,415		3,415		-			3,415
Right of use assets		483		483		-			483
Other current assets		145		145		-			145
Property and equipment		714		714		-			714
Customer relationships		5,460		5,460		-			5,460
Trademarks		560		560		-			560
Patented technology		280		280		-			280
Goodwill		215		215		583			798
Other non-current assets		3		3		-			3
Total assets acquired	$	18,257	$	18,257	$	94		$	18,351

Liabilities assumed:
Accounts payable		757		757		-			757
Accrued expenses		483		219		94			313
Lease liabilities		219		483		-			483
Warranty accrual		188		188		-			188
Total	$	1,647	$	1,647	$	94		$	1,741
Total purchase price	$	16,610	$	16,610	$	-		$	16,610

The purchase allocation presented above is preliminary. We are in the process of refining the valuation of acquired assets and liabilities, including goodwill, and expect to finalize the purchase price allocation prior to January 30, 2021. During the three and nine months ended November 30, 2020, the Company recorded a cumulative net measurement period adjustment that increased goodwill by $583, as presented in the ~~third quarter~~table above. The measurement period adjustment had no impact on the results of ~~Fiscal 2021.~~the previous quarters. The Company made these measurement period adjustments to reflect facts and circumstances that existed as of the acquisition date and did not result from intervening events subsequent to such date. Goodwill was determined as the excess of the purchase price over the fair value of the assets acquired (including the identifiable intangible assets). and represents synergies expected.

Basic net income (loss) ~~income~~ per common share, net of non-controlling interest, is based upon the weighted-average common shares outstanding during the period. Diluted net income (loss) ~~income~~ per common share, net of non-controlling interest, reflects the potential dilution that would occur if common stock equivalent securities or other contracts to issue common stock were exercised or converted into common stock.

There are no0 reconciling items which impact the numerator of basic and diluted net income (loss) ~~income~~ per common share. A reconciliation between the denominator of basic and diluted net income (loss) ~~income~~ per common share is as follows:

Restricted stock and stock grants totaling ~~596,379~~0 and ~~627,544~~43,374 for the three months ended ~~May 31,~~November 30, 2020 and 2019, respectively, and 17,009 and 672,531 for the nine months ended November 30, 2020 and 2019, respectively, were not included in the net income (loss) ~~income~~ per diluted share calculation because the grant price of the restricted stock and stock grants was greater than the average market price of the Company’s common stock during these periods, or the inclusion of these components would have been anti-dilutive.

As of ~~May 31,~~November 30, 2020, and February 29, 2020, the Company had the following investments:

The Company’s mutual funds are held in connection with its deferred compensation plan. Changes in the carrying value of these securities are offset by changes in the corresponding deferred compensation liability.

In July 2017, the Company sold its investment in RxNetworks, a non-controlled corporation, consisting of shares of the investee’s preferred stock. Voxx recognized a gain of $1,416 during Fiscal 2018 for the sale of this investment. A portion of the cash proceeds for the sale was subject to a hold-back provision, which was not included in the calculation of the gain recognized in Fiscal 2018, as it was considered a gain contingency. During the second quarter of Fiscal 2020, the hold-back provision expired, and the Company received additional proceeds from the sale in August 2019, recording an investment gain of $775 for the nine months ended November 30, 2019. In November 2020, a final disbursement of all remaining proceeds from the sale of RxNetworks attributable to Voxx was received in the amount of $42, which was recorded as an investment gain for the three and nine months ended November 30, 2020.

The Company applies the authoritative guidance on “Fair Value Measurements," which among other things, requires enhanced disclosures about assets and liabilities that are measured and reported at fair value. This guidance establishes a hierarchal disclosure framework that prioritizes and ranks the level of market price observability used in measuring investments at fair value. Market price observability is impacted by a number of factors, including the type of investment and the characteristics specific to the investment. Investments with readily available active quoted prices, or for which fair value can be measured from actively quoted prices, generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Investments measured and reported at fair value are classified and disclosed in one of the following categories:

Level 1 - Quoted market prices in active markets for identical assets or liabilities.

Level 2 - Inputs other than Level 1 inputs that are either directly or indirectly observable.

Level 3 - Unobservable inputs developed using the Company's estimates and assumptions, which reflect those that market participants would use.

At ~~May 31,~~November 30, 2020 and February 29, 2020, the Company did not have any assets or liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).

The following table presents financial assets measured at fair value on a recurring basis at ~~May 31,~~November 30, 2020:

The following table presents financial assets and liabilities measured at fair value on a recurring basis at February 29, 2020:

At ~~May 31,~~November 30, 2020, the carrying value of the Company's accounts receivable, short-term debt, accounts payable, accrued expenses, bank obligations and long-term debt approximates fair value because of either (i) the short-term nature of the financial instrument; (ii) the interest rate on the financial instrument being reset every quarter to reflect current market rates; or (iii) the stated or implicit interest rate approximates the current market rates or are not materially different from market rates.

The Company’s derivative instruments include forward foreign currency contracts and an interest rate swap agreement. The forward foreign currency contracts are utilized to hedge a portion of ~~its~~the Company’s foreign currency inventory purchases. The forward foreign currency derivatives qualifying for hedge accounting are designated as cash flow hedges and valued using observable forward rates for the same or similar instruments (Level 2). The duration of open forward foreign currency contracts ranges from 1 month ~~– 10~~to 15 months and are classified in the balance sheet according to their terms. The ~~Company also has an~~Company’s interest rate swap agreement ~~as of May 31, 2020 that~~ hedges interest rate exposure related to the outstanding balance of its Florida Mortgage, with monthly payments due through March 2026. The swap agreement locks the interest rate on the debt at 3.48% (inclusive of credit spread) through the maturity date of the loan. Interest rate swap agreements qualifying for hedge accounting are designated as cash flow hedges and valued based on a

comparison of the change in fair value of the actual swap contracts designated as the hedging instruments and the change in fair value of a hypothetical swap contract (Level 2). We calculate the fair value of our interest rate swap agreement quarterly based on the quoted market price for the same or similar financial instruments. Interest rate swaps are classified in the balance sheet as either assets or liabilities based on the fair value of the instruments at the end of the period.

The following table discloses the fair value as of ~~May 31,~~November 30, 2020 and February 29, 2020 of the Company’s derivative ~~instrument:~~instruments:

~~It is the~~The Company's policy is to enter into derivative instrument contracts with terms that coincide with the underlying exposure being hedged. As such, the Company’s derivative instruments are expected to be highly effective. ~~On March 1, 2019, the Company adopted ASU No. 2017-12,~~ ~~Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities, which eliminated the requirement to separately measure and report hedge ineffectiveness.~~ For derivative instruments that are designated and qualify as cash flow hedges, the entire change in fair value of the hedging instrument included in the assessment of the hedge ineffectiveness is recorded to ~~other~~Other comprehensive income ~~(“OCI”)~~(loss). When the amounts recorded in ~~OCI~~Other comprehensive income (loss) are reclassified to earnings, they are presented in the same income statement line item as the effect of the hedged item. ~~The adoption~~

During the first quarter of ~~ASU No. 2017-12 did not have a material impact on the Company’s consolidated financial statements.~~

~~On May 29, 2020,~~Fiscal 2021, the Company entered into forward foreign currency contracts, which have a current outstanding notional value of ~~$8,000~~$13,160 and are designated as cash flow hedges at ~~May 31,~~November 30, 2020. During Fiscal 2020, the Company did not enter into any forward foreign currency contracts and all previous contracts were settled through February 29, 2020. The current outstanding notional value of the Company's interest rate swap at ~~May 31,~~November 30, 2020 is ~~$7,489.~~$7,239. For cash flow hedges, the gain or loss is reported as a component of Other comprehensive income (loss) ~~income~~ and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The net (loss) income recognized in Other comprehensive income (loss) ~~income~~ for foreign currency contracts is expected to be recognized in Cost of sales during the next ~~thirteen~~eighteen months. NoNaN amounts were excluded from the assessment of hedge effectiveness during the respective periods. The gain or loss on the Company’s interest rate swap is recorded in Other comprehensive income (loss) ~~income~~ and subsequently reclassified into Interest and bank charges in the period in which the hedged transaction affects earnings. As of ~~May 31,~~November 30, 2020, no0 interest rate swaps originally designated for hedge accounting were de-designated or terminated.

Activity related to cash flow hedges recorded during the three and nine months ended ~~May 31,~~November 30, 2020 and 2019 was as follows:

The Company’s accumulated other comprehensive income (loss) ~~income~~ consists of the following:

During the three and nine months ended ~~May 31,~~November 30, 2020, the Company recorded other comprehensive income (loss), net of the associated tax ~~expense~~impact of $38 and $200, respectively, related to derivatives designated in a hedging relationship, ~~of $(21),~~ and $0 in both periods related to pension plan ~~adjustments of $0.~~adjustments.

The other comprehensive income (loss) before reclassification of ~~$504~~$3,608 includes the remeasurement of intercompany transactions of a long-term investment nature of ~~$(186)~~$(983) with certain subsidiaries whose functional currency is not the U.S. dollar, and ~~$690~~$4,591 from translating the financial statements of the Company's non-U.S. dollar functional currency subsidiaries into our reporting currency, which is the U.S. dollar.

~~The following is supplemental information relating to the Unaudited Consolidated Statements of Cash Flows:~~

~~The Company has various stock-based compensation plans, which are more fully described in Note 1 of the Company’s Form 10-K for the fiscal year ended February 29, 2020.~~

The following is supplemental information relating to the Unaudited Consolidated Statements of Cash Flows:

The Company has various stock-based compensation plans, which are more fully described in Note 1 of the Notes to the Consolidated Financial Statements contained in the Company’s Form 10-K for the fiscal year ended February 29, 2020.

Restricted stock awards are granted pursuant to the Company's 2012 Equity Incentive Plan (the "2012 Plan"). A restricted stock award is an award of common stock that is subject to certain restrictions during a specified period. Restricted stock awards are independent of option grants and are subject to forfeiture if employment terminates for a reason other than death, disability, or retirement prior to the release of the restrictions.

The Company's Omnibus Equity Incentive Plan was established in 2014 (the "2014 Plan"). Pursuant to the 2014 Plan, Restricted Stock Units ("RSUs") may be awarded by the Company to any individual who is employed by, provides services to, or serves as a director of the Company or its affiliates. RSUs vest on the later of three years from the date of grant, or the grantee reaching the age of 65 years. The RSU awards will also vest upon the sale of all of the Company's issued and outstanding stock, the sale of all, or substantially all, of the assets of a subsidiary of which the grantee serves as CEO and/or President, or the termination of the grantee's employment without cause, provided that the grantee at the time of termination has been employed for at least 10 years. When vested, RSU awards may be settled in shares of common stock or in cash, at the Company's sole option. There are no market conditions inherent in an RSU award, only the employee performance requirement for performance awards, and the service requirement that the respective employee continues employment with the Company through the vesting date. In July ~~2019,~~2020, the Company granted ~~71,352~~48,269 RSU awards to employees under the 2014 Plan. The Company expenses the cost of RSU awards on a straight-line basis over the requisite service period of each grantee. For these purposes, the fair market value of each RSU is determined based on the mean of the high and low price of the Company's common stock on the grant date. The fair market value of each RSU granted in July ~~2019~~2020 was ~~$4.65.~~$5.76. In October 2020, the Company granted 40,000 fully vested RSU awards to its non-employee directors. The fair market value of each of these RSU’s was $8.89.

On July 8, 2019, the Board of Directors approved a five-year Employment Agreement (the “Employment Agreement”), effective March 1, 2019, by and between the Company and Patrick M. Lavelle, the Company’s President and Chief Executive Officer. Under the terms of the Employment Agreement, in addition to a $1,000 annual salary and a cash bonus based on the Company’s Adjusted EBITDA, Mr. Lavelle agreed to receive certain stock-based compensation as discussed below:

All stock grants under the Employment Agreement are subject to a hold requirement as specified in the Employment Agreement. The Employment Agreement gave Mr. Lavelle, in certain limited change of control situations, the right to require the Company to purchase the shares in connection with the Employment Agreement, shares personally acquired by Mr. Lavelle, and shares issued to him under other incentive compensation arrangements. Accordingly, the stock awards issued in connection with the Employment Agreement are presented as redeemable equity on the Consolidated Balance Sheet at grant-date fair value. RSUs previously held by Mr. Lavelle under the 2014 Plan and shares personally purchased by Mr. Lavelle have been reclassified from permanent equity to redeemable equity. As the contingent events that would allow Mr. Lavelle to redeem the shares are not probable at this time, remeasurement of the amounts in redeemable equity have not been recorded. The Employment Agreement contains certain restrictive and non-solicitation covenants.

The following table presents a summary of the activity related to the initial stock grant, additional stock grants under the Employment Agreement, and RSU grants under the 2014 Plan for the ~~three~~nine months ended ~~May 31,~~November 30, 2020:

At ~~May 31,~~November 30, 2020, there were ~~306,548~~278,318 vested and unsettled RSU awards under the Company’s 2014 Plan with a weighted average fair value of ~~$6.83.~~$7.71. In July 2020, the vested RSU awards for two of the Company’s former employees, totaling 105,123 award units, were settled in cash in an amount totaling $575.

During the three and nine months ended ~~May 31,~~November 30, 2020, the Company recorded ~~$351~~$768 and $1,454, respectively, in total stock-based compensation related to the 2014 Plan, as well as additional stock grants and MSU’s under the Employment Agreement. As of ~~May 31,~~November 30, 2020, there was approximately ~~$2,000~~$1,760 of unrecognized stock-based compensation expense related to unvested ~~restricted~~RSU awards, stock ~~awards.~~grants, and MSU’s.

The Company has supply chain financing agreements and factoring agreements that were entered into for the purpose of accelerating receivable collection and better managing cash flow. The balances under the agreements are sold without recourse and are accounted for as sales of accounts receivable. Total receivable balances sold for the three and nine months ended ~~May 31,~~November 30, 2020, net of discounts, were ~~$18,875~~$20,876 and $60,039, respectively, compared to ~~$22,649~~$14,062 and $50,897, respectively, for the three and nine months ended ~~May 31,~~November 30, 2019.

Expenditures for research and development are charged to expense as incurred. Such expenditures amounted to $1,855 for the three months ended May 31, 2020, compared to $1,863 for the three months ended May 31, 2019, net of customer reimbursements, and are included within Engineering and technical support expenses on the Unaudited Consolidated Statements of Operations and Comprehensive (Loss) Income.

Expenditures for research and development are charged to expense as incurred. Such expenditures amounted to $1,892 and $5,413 for the three and nine months ended November 30, 2020, respectively, compared to $1,672 and $5,434, respectively, for the three and nine months ended November 30, 2019. All amounts are net of customer reimbursements and are included within Engineering and technical support expenses on the Unaudited Consolidated Statements of Operations and Comprehensive Income (Loss).

The Company's Biometrics segment did ~~not~~0t carry a goodwill balance at ~~May 31,~~November 30, 2020 or February 29, 2020.

	Gross Carrying Value		Accumulated Amortization		Total Net Book Value		Gross Carrying Value		Accumulated Amortization		Total Net Book Value
Finite-lived intangible assets:
Customer relationships	$	51,592	$	32,857	$	18,735	$	54,604	$	35,312	$	19,292
Trademarks/Tradenames		1,045		457		588		5,545		681		4,864
Developed technology		14,144		12,312		1,832		14,144		12,448		1,696
Patents		5,659		3,895		1,764		6,729		4,389		2,340
License		1,400		1,400		—		1,400		1,400		0
Contract		1,556		1,556		—
Contracts								1,556		1,556		0
Total finite-lived intangible assets	$	75,396	$	52,477		22,919	$	83,978	$	55,786		28,192
Indefinite-lived intangible assets
Trademarks						64,274						64,605
Total intangible assets, net					$	87,193					$	92,797

	Gross Carrying Value		Accumulated Amortization		Total Net Book Value		Gross Carrying Value		Accumulated Amortization		Total Net Book Value
Finite-lived intangible assets:
Customer relationships	$	51,491	$	31,880	$	19,611	$	51,491	$	31,880	$	19,611
Trademarks/Tradenames		1,045		437		608		1,045		437		608
Developed technology		14,144		12,244		1,900		14,144		12,244		1,900
Patents		5,651		3,691		1,960		5,651		3,691		1,960
License		1,400		1,400		—		1,400		1,400		0
Contract		1,556		1,556		—
Contracts								1,556		1,556		0
Total finite-lived intangible assets	$	75,287	$	51,208		24,079	$	75,287	$	51,208		24,079
Indefinite-lived intangible assets
Trademarks						64,209						64,209
Total intangible assets, net					$	88,288					$	88,288

The Company recorded amortization expense of ~~$1,169~~$1,477 and $3,973, respectively, for the three and nine months ended ~~May 31,~~November 30, 2020 and $1,748 and $5,243 for the three and nine months ended ~~May 31, 2019.~~November 30, 2019, respectively. The estimated aggregate amortization expense for all amortizable intangibles for ~~May 31~~November 30 of each of the succeeding years is as follows:

As of ~~May 31,~~November 30, 2020 and February 29, 2020, the Company has a 50% non-controlling ownership interest in ASA Electronics, LLC and Subsidiary (“ASA") which acts as a distributor of mobile electronics specifically designed for niche markets within the automotive industry, including RV's; buses; and commercial, heavy duty, agricultural, construction, powersport, and marine vehicles.

The following presents summary financial information for ASA. Such summary financial information has been provided herein based upon the individual significance of ASA to the consolidated financial information of the Company.

The Company's share of income from ASA was ~~$862~~$1,761 and $4,506 for the three and nine months ended ~~May 31,~~November 30, 2020, respectively, and ~~$1,440~~$967 and $3,672 for the three and nine months ended May 31, 2019. The decrease in ASA’s operating and net income for the three months ended May 31, 2020 compared to the prior year period is primarily a result of the impact of the COVID-19 pandemic on ASA’s sales during the period due to business shut downs and quarantine orders.November 30, 2019, respectively.

The Company’s provision for income taxes consists of federal, foreign, and state taxes necessary to align the Company’s year-to-date tax provision with the annual effective rate that it expects to achieve for the full year. At each interim period, the Company updates its estimate of the annual effective tax rate and records cumulative adjustments, as necessary.

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was enacted in response to the COVID-19 pandemic. The CARES Act made various tax law changes, including among other things (i) increased the limitation under IRC Section 163(j) for 2019 and 2020 to permit additional expensing of interest (ii) enacted technical corrections so that qualified improvement property can be immediately expensed under IRC Section 168(k) and net operating losses arising in tax years beginning in 2017 and ending in 2018 can be carried back two years and carried forward twenty years without a taxable income limitation as opposed to carried forward indefinitely, and (iii) made modifications to the federal net operating loss rules including permitting federal net operating losses incurred in 2018, 2019, and 2020 to be carried back to the five preceding taxable years. With respect to the technical correction to net operating losses, the Company recorded a discrete income tax provision of $4,275 during the ~~three~~nine months ended ~~May 31,~~November 30, 2020, as its valuation allowance related to net operating losses with limited carryforward periods increased.

For the three months ended ~~May 31,~~November 30, 2020, the Company recorded an income tax provision of ~~$1,781,~~$2,334, which includes a discrete income tax benefit of $542 related primarily to finalization of the federal and certain state tax return filings. For the three months ended November 30, 2019, the Company recorded an income tax provision of $2,720, which includes a discrete income tax provision of ~~$4,292.~~$1,035. The Company recorded a discrete tax provision of ~~$4,275~~$1,153 in connection with excluding the U.S. tax jurisdiction from the estimated annual effective tax rate and a discrete tax benefit of $118 primarily related to ~~an increase in valuation allowance~~the reversal of uncertain tax provision liabilities as a result of the ~~technical correction to net operating losses as provided in~~lapse of the ~~CARES Act,~~applicable statute of limitations, the remeasurement of deferred tax assets and ~~a discrete~~liabilities for enacted state law changes, offset by an income tax provision ~~of $17~~ related to the ~~accrual for interest for unrecognized~~finalization of federal and state tax ~~benefits. For~~filings during the ~~three months~~quarter ended ~~May 31, 2019, the Company recorded an income tax benefit of $2,645, which includes a discrete income tax provision of $19, related to the accrual of interest for unrecognized tax benefits.~~November 30, 2019.

The effective tax rates for the three months ended ~~May 31,~~November 30, 2020 and 2019 were an income tax provision of ~~24.3%~~11.8% on pre-tax ~~loss~~income of ~~$7,324~~$19,774 and an income tax ~~benefit~~provision of ~~52.7%~~66.6% on a pre-tax ~~loss~~income of ~~$5,017.~~$4,087, respectively. The effective tax rate for the three months ended ~~May 31,~~November 30, 2020 differs from the U.S. statutory rate of 21% primarily due to the anticipated reversal of a portion of the U.S. valuation allowance based on projected current year earnings, immediate U.S. taxation of foreign earnings, non-controlling interest related to EyeLock LLC, state and local income taxes, nondeductible permanent differences, and income taxed in foreign jurisdictions at varying tax rates. The effective tax rate for the three months ended ~~May 31,~~November 30, 2019 differed from the statutory rate of 21% primarily due to the calculation of the U.S. tax provision on a discrete basis, the U.S. taxation of foreign earnings, nondeductible permanent differences, non-controlling interest related to EyeLock LLC, an increase in the valuation allowance, state and local income taxes, and income taxed in foreign jurisdictions at varying tax rates.

For the nine months ended November 30, 2020, the Company recorded an income tax provision of $6,724, which includes a discrete income tax provision of $3,609. The Company recorded a discrete tax provision of $4,275 related to an increase in valuation allowance as a result of the technical correction to net operating losses as provided in the CARES Act, and a discrete income tax benefit of $697 related to the finalization of federal and state filings during the quarter ended November 30 2020, and the reversal of uncertain tax provision liabilities as a result of the lapse of the applicable statute of limitations, offset with a discrete tax provision of $31 related to the accrual for interest for unrecognized tax benefits. For the nine months ended November 30, 2019, the Company recorded an income tax provision of $1,190, which includes a discrete income tax benefit of $345. The Company recorded a discrete tax benefit of $50 in connection with excluding the U.S. tax jurisdiction from the estimated annual effective tax rate, and a discrete income tax benefit of $295 primarily related to the reversal of uncertain tax provision liabilities as a result of the lapse of the applicable statute of limitations, the remeasurement of deferred tax assets and liabilities for enacted state law changes, offset by an income tax provision related to the finalization of federal and state tax filings during the quarter ended November 30, 2019.

The effective tax rates for the nine months ended November 30, 2020 and 2019 were an income tax provision of 31.1% on pre-tax income of $21,614 and an income tax provision of 17.1% on a pre-tax loss of $6,979, respectively. The effective tax rate for the nine months ended November 30, 2020 differs from the U.S. statutory rate of 21% primarily due to the anticipated reversal of a portion of the U.S. valuation allowance based on projected current year earnings, immediate U.S. taxation of foreign earnings, non-controlling interest related to EyeLock LLC, state and local income taxes, nondeductible permanent differences, and income taxed in foreign jurisdictions at ~~varying tax rates~~.

At May 31, 2020, the Company had an uncertain tax position liability of $1,213, including interest and penalties. The unrecognized tax benefits include amounts related to various U.S. federal, state and local, and foreign tax issues.

varying tax rates. The effective tax rate for the nine months ended November 30, 2019 differed from the statutory rate of 21% primarily due to the calculation of the U.S. taxation provision on a discrete basis, the U.S. taxation of foreign earnings, non-deductible permanent differences, non-controlling interest related to EyeLock LLC, an increase in the valuation allowance, state and local income taxes, and income taxed in foreign jurisdictions at varying tax rates.

At November 30, 2020, the Company had an uncertain tax position liability of $1,123, including interest and penalties. The unrecognized tax benefits include amounts related to various U.S. federal, state and local, and foreign tax issues.

The following table provides a summary of the activity with respect to product warranties and product repair costs. The liability for product warranties is included within Accrued expenses and other current liabilities and the reserve for product repair costs is recorded as a reduction of Inventory on the Consolidated Balance Sheets.

At February 29, 2020, the Company had accrued restructuring charges of $637 included in Accrued expenses and other current liabilities, representing charges incurred in Fiscal 2019 for the realignment of certain businesses within the organization. During the three and nine months ended ~~May 31,~~November 30, 2020, an additional ~~$301~~$63 and $532 of the accrual was settled and no0 additional restructuring expenses were incurred. At ~~May 31,~~November 30, 2020, the remaining restructuring accrual in Accrued expenses and other current liabilities is ~~$336.~~

As of May 31, 2020, the Company has a senior secured credit facility (the "Credit Facility") that provides for a revolving credit facility with committed availability of up to $140,000, which may be increased, at the option of the Company, up to a maximum of $175,000, and a term loan in the amount of $15,000. The Credit Facility also includes a $15,000 sublimit for letters of credit and a $15,000 sublimit for swingline loans. The availability under the revolving credit line within the Credit Facility is subject to a borrowing base, which is based on eligible accounts receivable, eligible inventory and certain real estate, subject to reserves as determined by the lender, and is also limited by amounts outstanding under the Florida Mortgage (see Note 17(b)). The entire outstanding balance of the term loan, which is not renewable, was repaid in Fiscal 2018. The availability under the revolving credit line of the Credit Facility was $43,769 as of May 31, 2020.

All amounts outstanding under the Credit Facility will mature and become due on April 26, 2021; however, it is subject to acceleration upon the occurrence of an Event of Default (as defined in the Credit Agreement). The Company may prepay any amounts outstanding at any time, subject to payment of certain breakage and redeployment costs relating to LIBOR Rate Loans. The commitments under the Credit Facility may be irrevocably reduced at any time, without premium or penalty as set forth in the agreement. On June 11, 2020,

the Company amended the Credit Facility. Under the amendment, the committed availability of the revolving credit facility was revised to $127,500 and the maturity date of the facility was extended to April 26, 2022 (see Note 27).

Generally, the Company may designate specific borrowings under the Credit Facility as either Base Rate Loans or LIBOR Rate Loans, except that swingline loans may only be designated as Base Rate Loans. Loans designated as LIBOR Rate Loans bear interest at a rate equal to the then applicable LIBOR rate plus a range of 1.75 - 2.25%. Loans designated as Base Rate loans bear interest at a rate equal to the applicable margin for Base Rate Loans of 0.75 - 1.25% as defined in the agreement. As of May 31, 2020, the weighted average interest rate on the facility was 2.50%.

Provided that the Company is in a Compliance Period (the period commencing on that day in which Excess Availability is less than 12.5% of the Maximum Revolver Amount and ending on a day in which Excess Availability is equal to or greater than 12.5% for any consecutive 30 day period thereafter), the Credit Facility requires compliance with a financial covenant calculated as of the last day of each month, consisting of a Fixed Charge Coverage Ratio. The Credit Facility also contains covenants, subject to defined carveouts, that limit the ability of the loan parties and certain of their subsidiaries which are not loan parties to, among other things: (i) incur additional indebtedness; (ii) incur liens; (iii) merge, consolidate or dispose of a substantial portion of their business; (iv) transfer or dispose of assets; (v) change their name, organizational identification number, state or province of organization or organizational identity; (vi) make any material change in their nature of business; (vii) prepay or otherwise acquire indebtedness; (viii) cause any change of control; (ix) make any restricted junior payment; (x) change their fiscal year or method of accounting; (xi) make advances, loans or investments; (xii) enter into or permit any transaction with an affiliate of any borrower or any of their subsidiaries; (xiii) use proceeds for certain items; (xiv) issue or sell any of their stock; or (xv) consign or sell any of their inventory on certain terms. In addition, if excess availability under the Credit Facility were to fall below certain specified levels, as defined in the agreement, the lenders would have the right to assume dominion and control over the Company's cash. As of May 31, 2020, the Company was not in a Compliance Period.

The obligations under the loan documents are secured by a general lien on, and security interest in, substantially all of the assets of the borrowers and certain of the guarantors, including accounts receivable, equipment, real estate, general intangibles and inventory. The Company has guaranteed the obligations of the borrowers under the Credit Agreement.

Charges incurred on the unused portion of the Credit Facility during the three months ended May 31, 2020 totaled $116, compared to $126 during the three months ended May 31, 2019. These charges are included within Interest and bank charges on the Unaudited Consolidated Statements of Operations and Comprehensive (Loss) Income.

The Company has deferred financing costs related to the Credit Facility and a previous amendment and modification of the Credit Facility. These deferred financing costs are included in Long-term debt on the accompanying Consolidated Balance Sheets as a contra-liability balance and are amortized through Interest and bank charges in the Unaudited Consolidated Statements of Operations and Comprehensive (Loss) Income over the five-year term of the Credit Facility. During both the three months ended May 31, 2020 and 2019, the Company amortized $198 of these costs. The net unamortized balance of these deferred financing costs as of May 31, 2020 is $631.

On July 6, 2015, VOXX HQ LLC, the Company’s wholly owned subsidiary, closed on a $9,995 industrial development revenue tax exempt bond under a loan agreement in favor of the Orange County Industrial Development Authority (the “Authority”) to finance the construction of the Company's manufacturing facility and executive offices in Lake Nona, Florida. Wells Fargo Bank, N.A. ("Wells Fargo") was the purchaser of the bond and U.S. Bank National Association is the trustee under an Indenture of Trust with the Authority. Voxx borrowed the proceeds of the bond purchase from the Authority during construction as a revolving loan, which converted to a permanent mortgage upon completion of the facility in January 2016 (the "Florida Mortgage"). The Company makes principal and interest payments to Wells Fargo, which began March 1, 2016 and will continue through March of 2026. The Florida Mortgage bears interest at 70% of 1-month LIBOR plus 1.54% (1.67% at May 31, 2020) and is secured by a first mortgage on the property, a collateral$105.

(Amounts in ~~the Company’s Credit Facility with Wells Fargo dated April 26, 2016.~~thousands, except share and per share data)

The Company incurred debt financing costs totaling approximately $332 as a result of obtaining the Florida Mortgage, which are recorded as deferred financing costs and included in Long-term debt as a contra-liability balance on the accompanying Consolidated Balance Sheets and are being amortized through Interest and bank charges in the Unaudited Consolidated Statements of Operations and Comprehensive (Loss) Income over the ten-year term of the Florida Mortgage. The Company amortized $8 of these costs during both of the three months ended May 31, 2020 and 2019. The net unamortized balance of these deferred financing costs as of May 31, 2020 is $179.

On July 20, 2015, the Company entered into an interest rate swap agreement in order to hedge interest rate exposure related to the Florida Mortgage and pays a fixed rate of 3.48% under the swap agreement (See Note 5).

Foreign bank obligations include a Euro Asset-Based Lending ("ABL") credit facility, which has a credit limit of €8,000 for the Company's subsidiary, VOXX Germany, which expires on July 31, 2020. The rate of interest for the ABL is the three-month Euribor plus 2.3% (2.30% at May 31, 2020). As of May 31, 2020, there is no balance outstanding under this credit facility.

Foreign bank obligations also include an ABL credit facility, for the Company's subsidiary, Magnat, which expires on December 31, 2020. The rate of interest for the ABL is the three-month Euribor plus 2.1% (2.10% at May 31, 2020).

The decrease in interest income for the three and nine months ended ~~May 31,~~November 30, 2020 as compared to the prior year periods primarily relates to the decrease in interest rates applicable to the Company’s short-term money market ~~investments as compared to~~investments. For the ~~prior year. Included within miscellaneous for the three~~nine months ended ~~May 31, 2020 are the proceeds from a key man life insurance policy in the amount of $444 related to a Company executive who passed away during the quarter. For the three months ended May 31,~~November 30, 2019, miscellaneous included proceeds from a key man life insurance policy in the amount of $1,000 related to a former employee of Klipsch Group, Inc. that Voxx became the beneficiary of in conjunction with the acquisition of Klipsch in Fiscal ~~2012.~~2012, offset by a payment of $804 in settlement of the final working capital calculation related to the sale of the Company’s former Hirschmann subsidiary in Fiscal 2018. The final working capital settlement impacted both the three and nine months ended November 30, 2019.

The Company has a subsidiary in Venezuela. Venezuela has experienced significant political and civil unrest, as well as economic instability for several years, and has implemented various foreign currency and price controls. The country has also experienced high rates of inflation over the last several years. The President of Venezuela has the authority to legislate certain areas by decree, which allows the government to nationalize certain industries or expropriate certain companies and property. The Company accounts for its Venezuela subsidiary as hyper-inflationary in accordance with the guidelines in ASC 830, "Foreign Currency." A hyper-inflationary economy designation occurs when a country has experienced cumulative inflation of approximately 100 percent or more over a 3-year period. The hyper-inflationary designation requires the local subsidiary in Venezuela to record all transactions as if they were denominated in U.S. dollars. As of ~~May 31,~~November 30, 2020, the DICOM rate for the Sovereign Bolivar was approximately

~~198,722~~ 1,033,000 bolivars to the U.S. dollar compared to ~~5,717~~38,109 at ~~May 31,~~November 30, 2019. ~~Total~~The Company’s operations in Venezuela are suspended and net currency exchange gains ~~for Venezuela of $1 were recorded~~and losses for the three and nine months ended ~~May 31,~~November 30, 2020 ~~as compared to $0 for the three months ended May 31, 2019, and are included in Other income (expense) on the Unaudited Consolidated Statements of Operations and Comprehensive (Loss) Income.~~were not significant.

The Company has certain long-lived assets in Venezuela, which are held for investment purposes. ~~The~~These properties had 0 value ~~of these properties is $0~~ at ~~May 31,~~November 30, 2020

We account for leases in accordance with ASC 842 “Leases” (“ASC 842”). We determine whether an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys the right to control the use of an identified fixed asset explicitly or implicitly for a period of time in exchange for consideration.

We have operating leases for office equipment, as well as offices, warehouses, and other facilities used for our operations. We also have finance leases comprised primarily of computer hardware and machinery and equipment. Our leases have remaining lease terms of less than 1 year to 710 years, some of which include renewal options. We consider these renewal options in determining the lease term used to establish our right-of-use assets and lease

liabilities when it is determined that it is reasonably certain that the renewal option will be exercised. The Company had ~~no short term~~0 short-term leases during the three and nine months ended ~~May 31,~~November 30, 2020.

On September 30, 2019, the Company, through its subsidiary Voxx German Holdings GmbH, executed a sale leaseback transaction, selling its real property in Pulheim, Germany to CLM S.A. RL (“the Purchaser”) for €10,920. Net proceeds received from the transaction were approximately $9,500. The transaction qualified for sale leaseback accounting in accordance with ASC 842. Concurrently with the sale, the Company entered into an operating lease arrangement (“lease”) with the Purchaser for a small portion of the real property to continue to operate the combined Magnat/Klipsch sales office in Germany. The Company recognized a gain related to the execution of the sale transaction of $4,057 for the three and nine months ended November 30, 2019, which is recorded in Other income (expense) on the Unaudited Consolidated Statements of Operations and Comprehensive Income (Loss).

The components of lease cost for the three and nine months ended ~~May 31,~~November 30, 2020 and 2019 were as follows:

Supplemental ~~cash flow~~balance sheet information related to leases is as follows:

Three months ended

Three months ended

May 31, 2020

May 31, 2019

Non-cash investing and financing activities:

Right of use assets obtained in exchange for operating lease obligations

$
276

$
187

Right of use assets obtained in exchange for finance lease obligations

-

-

Upon the adoption of ASC 842:

Right of use assets recorded in exchange for operating lease obligations

$
—

$
2,227

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases

$
243

$
225

Operating cash flows from finance leases

9

12

Finance cash flows from finance leases

169

108

	November 30, 2020			February 29, 2020
Operating Leases
Operating lease, right of use assets	$	4,811		$	3,143
Total operating lease right of use assets	$	4,811		$	3,143
Accrued expenses and other current liabilities	$	1,111		$	784
Operating lease liabilities, less current portion		3,813			2,391
Total operating lease liabilities	$	4,924		$	3,175
Finance Leases
Property, plant, and equipment, gross	$	2,503		$	2,503
Accumulated depreciation		(1,674	)		(1,209	)
Total finance lease right of use assets	$	829		$	1,294
Accrued expenses and other current liabilities	$	469		$	613
Finance lease liabilities, less current portion		386			720
Total finance lease liabilities	$	855		$	1,333
Weighted Average Remaining Lease Term
Operating leases	6.1 years			4.4 years
Finance leases	2.1 years			3.9 years
Weighted Average Discount Rate
Operating leases		4.54	%		5.98	%
Finance leases		3.87	%		3.87	%

~~At May 31, 2020, maturities~~Maturities of lease liabilities ~~for~~on November 30 of each of the succeeding years ~~were~~are as follows:

As of ~~May 31,~~November 30, 2020, the Company has not entered into any lease agreements that have not yet commenced.

The Company owns and occupies buildings as part of its operations. Certain space within these buildings may, from time to time, be leased to third parties from which the Company earns rental income as lessor. This leased space is recorded within property, plant and equipment and was not material to the Company's Consolidated Balance ~~Sheet~~Sheets at ~~May 31,~~November 30, 2020 and February 29, 2020. Rental income earned by the Company for the three and nine months ended ~~May 31,~~November 30, 2020 and 2019 was ~~$186~~$188 and ~~$142,~~$556, respectively, and $176 and $460, respectively, which is recorded within Other income (expense).

			Shares Authorized				Shares Outstanding										Shares Authorized				Shares Outstanding
Security	Par Value		May 31, 2020		February 29, 2020		May 31, 2020		February 29, 2020		Voting Rights per Share		Liquidation Rights		Par Value		November 30, 2020		February 29, 2020		November 30, 2020		February 29, 2020		Voting Rights per Share		Liquidation Rights
Preferred Stock	$	50.00		50,000		50,000		—		—		—	$50 per share		$	50.00		50,000		50,000		0		0		0	$50 per share
Series Preferred Stock	$	0.01		1,500,000		1,500,000		—		—		—		—	$	0.01		1,500,000		1,500,000		0		0		0		—
Class A Common Stock	$	0.01		60,000,000		60,000,000		21,656,976		21,556,976		1	Ratably with Class B		$	0.01		60,000,000		60,000,000		21,666,976		21,556,976		1	Ratably with Class B
Class B Common Stock	$	0.01		10,000,000		10,000,000		2,260,954		2,260,954		10	Ratably with Class A		$	0.01		10,000,000		10,000,000		2,260,954		2,260,954		10	Ratably with Class A
Treasury Stock at cost	at cost			2,749,218		2,749,218	N/A		N/A		N/A				at cost			2,749,218		2,749,218	N/A		N/A		N/A

A variable interest entity ("VIE") is an entity that either (i) has insufficient equity to permit the entity to finance its activities without additional subordinated financial support, or (ii) has equity investors who lack the characteristics of a controlling financial interest. Under ASC 810 - Consolidation, an entity that holds a variable interest in a VIE and meets certain requirements would be considered to be the primary beneficiary of the VIE and required to consolidate the VIE in its consolidated financial statements. In order to be considered the primary beneficiary of a VIE, an entity must hold a variable interest in the VIE and have both:

On September 1, 2015, Voxx acquired a majority voting interest in substantially all of the assets and certain specified liabilities of EyeLock, Inc. and EyeLock Corporation, a market leader of iris-based identity authentication solutions, through a newly-formed entity, EyeLock LLC. The Company issued EyeLock LLC a promissory note for the purposes of repaying protective advances and funding working capital requirements of the entity. On ~~June 2,~~October 9, 2020, this

promissory note was amended and restated to allow EyeLock LLC to borrow up to ~~$57,500.~~$60,600. Through March 1, 2019, interest on the outstanding principal of the loan accrued at 10%. From March 1, 2019 forward, interest accrues at 2.5%. The amended and restated promissory note is due on ~~August 31, 2020.~~June 30, 2021. The outstanding principal balance of this promissory note is convertible at the sole option of Voxx into units of EyeLock LLC. If Voxx chooses not to convert into equity, the outstanding loan principal of the amended and restated promissory note will be repaid at a multiple of 1.50 based on the repayment date. The agreement includes customary events of default and is collateralized by all of the property of EyeLock LLC.

We concluded that we became the primary beneficiary of EyeLock LLC on September 1, 2015 in conjunction with the acquisition. This was the first date on which we had the power to direct the activities that most significantly impact the economic performance of the entity because we acquired a majority interest in substantially all of the assets and

certain liabilities of EyeLock, Inc. and EyeLock Corporation on this date, as well as obtained a majority voting interest as a result of this transaction. Although we are considered to have control over EyeLock LLC under ASC 810, due to our majority ownership interest, the assets of EyeLock LLC can only be used to satisfy the obligations of EyeLock LLC. As a result of our majority ownership interest in the entity and our primary beneficiary conclusion, we consolidated EyeLock LLC within our consolidated financial statements beginning on September 1, 2015.

The following table sets forth the carrying values of assets and liabilities of EyeLock LLC that were included on our Consolidated Balance Sheets as of ~~May 31,~~November 30, 2020 and February 29, 2020:

	May 31, 2020			February 29, 2020			November 30, 2020			February 29, 2020
Assets	(unaudited)						(unaudited)
Current assets:
Cash and cash equivalents	$	7		$	—		$	—		$	—
Accounts receivable, net		85			147			210			147
Inventory, net		2,292			2,052			2,212			2,052
Prepaid expenses and other current assets		217			313			253			313
Total current assets		2,601			2,512			2,675			2,512
Property, plant and equipment, net		52			69			27			69
Intangible assets, net		2,532			2,600			2,397			2,600
Other assets		60			76			60			76
Total assets	$	5,245		$	5,257		$	5,159		$	5,257
Liabilities and Partners' Deficit
Current liabilities:
Accounts payable	$	2,024		$	2,086		$	1,427		$	2,086
Interest payable to VOXX		10,344			9,994			11,077			9,994
Accrued expenses and other current liabilities		423			252			1,000			252
Due to VOXX		55,740			54,074			59,033			54,074
Total current liabilities		68,531			66,406			72,537			66,406
Other long-term liabilities		1,200			1,200			1,200			1,200
Total liabilities		69,731			67,606			73,737			67,606
Commitments and contingencies
Partners' deficit:
Capital		41,416			41,416			41,416			41,416
Retained losses		(105,902	)		(103,765	)		(109,994	)		(103,765	)
Total partners' deficit		(64,486	)		(62,349	)		(68,578	)		(62,349	)
Total liabilities and partners' deficit	$	5,245		$	5,257		$	5,159		$	5,257

The following table sets forth the revenues and expenses of EyeLock LLC that were included in our Unaudited Consolidated Statements of Operations and Comprehensive Income (Loss) ~~Income~~ for the three and nine months ended ~~May 31,~~November 30, 2020, ~~and 2019,~~ respectively:

	For the three months ended May 31,						For the three months ended November 30,						For the nine months ended November 30,
	2020			2019			2020			2019			2020			2019
Net sales	$	97		$	21		$	343		$	138		$	703		$	412
Cost of sales		119			71			293			178			674			592
Gross profit		(22	)		(50	)		50			(40	)		29			(180	)
Operating expenses:
Selling		177			201			132			173			434			535
General and administrative		429			1,220			446			1,123			1,303			3,500
Engineering and technical support		1,155			1,365			1,178			1,232			3,427			3,951
Total operating expenses		1,761			2,786			1,756			2,528			5,164			7,986
Operating loss		(1,783	)		(2,836	)		(1,706	)		(2,568	)		(5,135	)		(8,166	)
Other expense:
Interest and bank charges		(354	)		(300	)		(372	)		(324	)		(1,094	)		(939	)
Other, net								—			79			—			79
Total other expense, net		(354	)		(300	)		(372	)		(245	)		(1,094	)		(860	)
Loss before income taxes		(2,137	)		(3,136	)		(2,078	)		(2,813	)		(6,229	)		(9,026	)
Income tax expense		—			—			—			—			—			—
Net loss	$	(2,137	)	$	(3,136	)	$	(2,078	)	$	(2,813	)	$	(6,229	)	$	(9,026	)

The Company operates in ~~three~~3 distinct segments based on our products and our internal organizational structure. The ~~three~~3 operating segments, which are also the Company’s reportable segments, are Automotive Electronics, Consumer Electronics, and Biometrics.

Our Automotive Electronics segment designs, manufactures, markets and distributes rear-seat entertainment devices, ~~satellite radio products,~~remote start systems, automotive security, vehicle access systems, ~~remote start systems,~~mobile interface modules, mobile multimedia devices, aftermarket/OE-styled radios, car link-smartphone telematics applications, driver distraction products, collision avoidance systems, location-based services, turn signal switches, automotive lighting products, automotive sensing and camera systems, USB ports, cruise control systems, heated seats, and ~~heated seats.~~satellite radio products.

Our Consumer Electronics segment designs, manufactures, markets and distributeshome theater systems, high-end loudspeakers, outdoor speakers, business music systems, cinema speakers, flat panel speakers, wireless and Bluetooth speakers, soundbars, wired and wireless headphones and ear buds, DLNA (Digital Living Network Alliance) compatible devices, remote controls, karaoke products, personal sound amplifiers, infant/nursery products, activity tracking bands, healthcare wearables, smart-home security and safety products, as well as A/V connectivity, portable/home charging, reception, and digital consumer products.

Our Biometrics segment designs, manufactures, markets, and distributes iris identification and biometric security related products.

The accounting principles applied at the consolidated financial statement level are generally the same as those applied at the operating segment level and there are no material intersegment sales. The segments are allocated interest expense, based upon a pre-determined formula, which utilizes a percentage of each operating segment's intercompany balance, which is offset in Corporate/Eliminations.

	Automotive Electronics			Consumer Electronics			Biometrics			Corporate/ Eliminations			Total			Automotive Electronics		Consumer Electronics		Biometrics			Corporate/ Eliminations			Total
Three Months Ended May 31, 2020
Net sales	$	17,276		$	54,514		$	97		$	100		$	71,987
Equity in income of equity investees		862			—			—			—			862
Interest expense and bank charges		168			2,188			355			(1,858	)		853
Depreciation and amortization expense		466			965			86			1,026			2,543
Loss before income taxes		(3,110	)		(53	)		(2,137	)		(2,024	)		(7,324	)

Three Months Ended May 31, 2019
Three Months Ended November 30, 2020
Net sales	$	29,642		$	63,653		$	6		$	153		$	93,454		$	61,488	$	139,039	$	343		$	195		$	201,065
Equity in income of equity investees		1,440			—			—			—			1,440			1,761		0		0			0			1,761
Interest expense and bank charges		99			2,398			302			(1,802	)		997			537		2,290		372			(2,728	)		471
Depreciation and amortization expense		187			1,141			785			954			3,067			876		1,002		75			981			2,934
Income (loss) before income taxes		450			460			(2,980	)		(2,947	)		(5,017	)		6,601		20,351		(2,078	)		(5,100	)		19,774

Three Months Ended November 30, 2019
Net sales																$	29,985	$	79,914	$	138		$	75		$	110,112
Equity in income of equity investees																	967		0		0			0			967
Interest expense and bank charges																	137		2,560		324			(2,270	)		751
Depreciation and amortization expense																	187		1,093		783			1,038			3,101
Income (loss) before income taxes																	92		9,583		(2,813	)		(2,775	)		4,087

Nine Months Ended November 30, 2020
Net sales																$	111,397	$	288,545	$	703		$	439		$	401,084
Equity in income of equity investees																	4,506		0		0			0			4,506
Interest expense and bank charges																	1,058		6,584		1,094			(6,402	)		2,334
Depreciation and amortization expense																	2,050		2,921		247			3,006			8,224
Income (loss) before income taxes																	3,730		33,087		(6,229	)		(8,974	)		21,614

Nine Months Ended November 30, 2019
Net sales																$	86,472	$	206,601	$	398		$	341		$	293,812
Equity in income of equity investees																	3,672		0		0			0			3,672
Interest expense and bank charges																	354		7,427		939			(6,085	)		2,635
Depreciation and amortization expense																	567		3,356		2,352			2,954			9,229
Income (loss) before income taxes																	869		8,976		(8,835	)		(7,989	)		(6,979	)

The Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”). The core principle of ASC 606 is that an entity recognizes revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. We apply the FASB’s guidance on revenue recognition, which requires us to recognize the amount of revenue and consideration that we expect to receive in exchange for goods and services transferred to our customers. To do this, the Company applies the five-step model prescribed by the FASB, which requires us to: (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when, or as, we satisfy a performance obligation. ~~No performance obligation related amounts were deferred as of May 31, 2020 or May 31, 2019.~~

Within our Automotive Electronics segment, while the majority of the contracts we enter into with Original Equipment Manufacturers (“OEM”) are long-term supply arrangements, the performance obligations are established by the enforceable contract, which is generally considered to be the purchase order. The purchase orders are of durations less than one year. As such, the Company applies the practical expedient in ASC paragraph 606-10-50-14 and does not disclose information about remaining performance obligations that have original expected durations of one year or less, for which work has not yet been performed.

The Company’s primary source of revenue is derived from the manufacture and distribution of consumer electronic, automotive electronic, and biometric products. Our consumer ~~electronics~~electronic products primarily consist of finished goods sold to retail and commercial customers, consisting of premium audio products and other consumer electronic products. Our automotive electronic products, some of which are manufactured by the Company, are sold both to

OEM and aftermarket customers. Our biometrics products, primarily consisting of finished goods, are ~~primarily~~ sold to retail and commercial customers. We recognize revenue for sales to our customers when transfer of control of the related good or service has occurred. ~~All~~The majority of our revenue was recognized under the point in time approach for the three and nine months ended ~~May 31,~~November 30, 2020. Certain telematic subscription revenues generated by our Automotive Electronics segment are recognized over time. Contract terms with certain of our OEM customers could result in additional products and services being transferred over time as a result of the customized nature of some of our products, together with contractual provisions in the customer contracts that provide us with an enforceable right to payment for performance completed to date; however, under typical terms, we do not have the right to consideration until the time of shipment from our manufacturing facilities or distribution centers, or until the time of delivery to our customers. If certain contracts in the future provide the Company with this enforceable right of payment, the timing of revenue recognition from products transferred to customers over time may be slightly accelerated compared to our right to consideration at the time of shipment or delivery.

Under ASC 606, we are required to present a refund liability and a return asset within the Consolidated Balance Sheets. The changes in the refund liability are reported in Net sales, and the changes in the return asset are reported in Cost of sales in the Unaudited Consolidated Statements of Operations and Comprehensive Income (Loss) ~~Income.~~. As of

~~May 31,~~ November 30, 2020 and February 29, 2020, the balance of the return asset was ~~$1,166~~$1,822 and $1,544, respectively, and the balance of the refund liability was ~~$3,077~~$4,185 and $3,779, respectively, and are presented within Prepaid expenses and other current assets and Accrued expenses and other current liabilities, respectively, on the Consolidated Balance Sheets.

We warrant our products against certain defects in material and workmanship when used as designed, which primarily range from 30 days to 3 years. We offer limited lifetime warranties on certain products, which limit the customer’s remedy to the repair or replacement of the defective product or part for the designated lifetime of the product, or for the life of the vehicle for the original owner, if it is an automotive product. We do not sell extended warranties.

Contract assets primarily relate to the Company’s rights to consideration for work completed but not billed at the reporting date on contracts with customers. Contract assets are transferred to receivables when the rights become unconditional. Contract liabilities primarily relate to contracts where advance payments or deposits have been received, but performance obligations have not yet been met, and therefore, revenue has not been recognized. The Company ~~has no~~had current and non-current contract ~~asset or~~liability balances totaling $4,412 at November 30, 2020 related to telematic subscription services of the Company’s DEI subsidiary established in connection with the Company’s acquisition in July 2020 (see Note 2). Revenue recognized for the three months ended November 30, 2020 that was included in the contract liability balance for the Company’s August 31, 2020 quarter-end date was $2,767. There were 0 contract liability balances at ~~May 31,~~February 29, 2020. The Company had 0 contract asset balances at November 30, 2020 or February 29, 2020.

The Company operates in ~~three~~3 reportable segments: Automotive Electronics, Consumer Electronics, and Biometrics. ASC 606 requires further disaggregation of an entity’s revenue. In the following table, the Company's net sales are disaggregated by segment and product type for the three and nine months ended ~~May 31,~~November 30, 2020 and 2019:

	Three months ended May 31,				Three months ended November 30,				Nine months ended November 30,
	2020		2019		2020		2019		2020		2019
Automotive Electronics Segment
OEM Products	$	9,617	$	14,953	$	14,089	$	10,628	$	32,462	$	37,391
Aftermarket Products		7,659		14,689		47,399		19,357		78,935		49,081
Total Automotive Segment		17,276		29,642		61,488		29,985		111,397		86,472
Consumer Electronics Segment
Premium Audio Products		34,538		36,698		112,681		53,250		216,501		128,056
Other Consumer Electronic Products		19,976		26,955		26,358		26,664		72,044		78,545
Total Consumer Electronics Segment		54,514		63,653		139,039		79,914		288,545		206,601
Biometrics Segment
Biometric Products		97		6		343		138		703		398
Total Biometrics Segment		97		6		343		138		703		398
Corporate/Eliminations		100		153		195		75		439		341
Total Net Sales	$	71,987	$	93,454	$	201,065	$	110,112	$	401,084	$	293,812

The Company is currently, and has in the past, been a party to various routine legal proceedings incident to the ordinary course of business. If management determines, based on the underlying facts and circumstances of each matter, that it is probable a loss will result from a litigation contingency and the amount of the loss can be reasonably estimated, the estimated loss is accrued for. The Company does not believe that any current outstanding litigation matters will have a material adverse effect on the Company's financial statements, individually, or in the aggregate.

The products the Company sells are continually changing as a result of improved technology. As a result, although the Company and its suppliers attempt to avoid infringing known proprietary rights, the Company may be subject to legal proceedings and claims for alleged infringement by patent, trademark, or other intellectual property owners. Any claims relating to the infringement of third-party proprietary rights, even if not meritorious, could result in costly litigation, divert management’s attention and resources, or require the Company to either enter into royalty or license agreements that are not advantageous to the Company, or pay material amounts of damages.

In June 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” and subsequent amendments to the guidance, ASU 2018-19 in November 2018, ASU 2019-04 in April 2019, ASU 2019-05 in May 2019, and ASU 2019-10 and ASU 2019-11 in November 2019. The update changes how entities must measure credit losses for most financial assets and certain other instruments that aren’t measured at fair value through net income. The update replaces the “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. For available-for-sale debt securities, entities are required to record allowances, rather than reduce the carrying value, as they have under the other-than-temporary impairment model. It also simplifies the accounting model for purchased credit-impaired debt securities and loans. The amendment affects loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. ASU 2018-19 clarifies that receivables arising from operating leases are accounted for using lease guidance and not as financial instruments. ASU 2019-04 clarifies that equity instruments without readily determinable fair values for which an entity has elected the measurement alternative should be remeasured to fair value as of the date that an observable transaction occurred. ASU 2019-05 provides an option to irrevocably elect to measure certain individual financial assets at fair value instead of amortized cost. ASU 2019-10 delayed the effective date of ASU 2016-13 for smaller reporting companies (as defined by the SEC) and other non-SEC reporting entities to fiscal years beginning after December 15, 2022, including interim periods within those fiscal periods. ASU 2019-11 was issued to provide clarification guidance in the following areas: (i) expected recoveries for purchased financial assets with credit deterioration; (ii) transition relief for troubled debt restructurings; (iii) disclosures related to accrued interest receivables; (iv) financial assets secured by collateral maintenance provisions; and (v) conforming amendment to subtopic 805-20. The amendments should be applied on either a prospective transition or modified-retrospective approach depending on the subtopic. The Company adopted this update on March 1, 2020.

Payment terms for the Company’s sales are 90 days or less. Substantially all of the Company’s receivables are collected within twelve months of the transfer of products to customers and the Company expects this to continue going forward. The credit loss allowance is determined through an analysis of the aging of accounts receivable and assessment of risk based on historical trends, and an evaluation of the impact of current and projected economic conditions. Receivables from customers with deteriorating financial conditions are removed from the pool and evaluated separately. For the three months ended May 31, 2020, the Company’s assessment of its accounts receivable considered the business and market disruptions caused by COVID-19 and emerging credit and collectability trends. The adoption of ASU 2016-13 did not have a material impact on the Company’s allowance for expected credit losses on accounts receivable.

In January 2017, the FASB issued ASU No. 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment." Under the new guidance, if a reporting unit's carrying value exceeds its fair value, an entity will record an impairment charge based on that difference. The impairment charge will be limited to the amount of goodwill allocated to that reporting unit. The standard eliminates today's requirement to calculate goodwill impairment using Step 2, which calculates an impairment charge by comparing the implied fair value of goodwill with its carrying value. The standard does not change the guidance on completing Step 1 of the goodwill impairment test. The Company adopted the standard on March 1, 2020 and it has not had a material impact on the Company’s consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement." The ASU modifies the disclosure requirements in Topic 820, Fair Value Measurement, by removing certain disclosure requirements related to the fair value hierarchy, modifying existing disclosure requirements related to measurement uncertainty and adding new disclosure requirements, such as disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and disclosing the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. The Company adopted the standard for the quarter ended May 31, 2020, and it did not impact the disclosures in the Company’s consolidated financial statements.

In October 2018, the FASB issued ASU No. 2018-17, “Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities.” This ASU requires entities to consider indirect interests held through related parties under common control on a proportional basis, rather than as the equivalent of a direct interest in its entirety when determining whether a decision-making fee is a variable interest. The Company adopted the standard on March 1, 2020 and it did not have a material impact on the Company’s consolidated financial statements.

In November 2018, the FASB issued ASU No. 2018-18, "Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606." The ASU clarifies that certain transactions between collaborative arrangement participants should be accounted for as revenue when the collaborative arrangement participant is a customer in the context of a unit of account and precludes recognizing as revenue consideration received from a collaborative arrangement participant if the participant is not a customer. The Company adopted the standard on March 1, 2020 and it did not have a material impact on the Company’s consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-14, "Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans." ASU 2018-14 removes certain disclosures that are not considered cost beneficial, clarifies certain required disclosures and added additional disclosures. This ASU is effective for public companies for annual reporting periods and interim periods within those annual periods beginning after December 15, 2020. The amendments in ASU 2018-14 must be applied on a retrospective basis. The Company is currently assessing the effect, if any, that ASU 2018-14 will have on the disclosures in its consolidated financial statements.

In December 2019, the FASB issued ASU No. 2019-12, “Simplifying the Accounting for Income Taxes.” This guidance removes certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences. This guidance also clarifies and simplifies other areas of ASC 740. This guidance is effective for fiscal years beginning after December 15, 2020. The guidance in this update has various elements, some of which are applied on a prospective basis and others on a retrospective basis with earlier application permitted. The Company is currently evaluating the effect of this ASU on the Company’s consolidated financial statements and related disclosures.

In January 2020, the FASB issued ASU No. 2020-01, “Investments – Equity Securities (Topic 321), Investments – Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) – Clarifying the Interactions between Topic 321, Topic 323, and Topic 815.” The ASU is based on a consensus of the Emerging Issues Task Force and is expected to increase comparability in accounting for these transactions by clarifying the interaction of the accounting for equity securities under Topic 321 and investments accounted for under the equity method of accounting under Topic 323, and the accounting for certain forward contracts and purchased options accounted for under Topic 815. This ASU is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. Early adoption is permitted. The Company does not expect the adoption of ASU 2020-01 to have a material impact on its consolidated financial statements.

On June 11, 2020, the Company entered into Amendment No. 7 to the Credit Facility. Pursuant to the terms thereof, the Credit Facility was amended primarily to: (i) provide for a Maximum Credit under the Credit Facility of $127,500; (ii) extend the Maturity Date to April 26, 2022; (iii) allow for LIBOR replacement under certain conditions and amend the LIBOR and Base Rate margins; (iv) raise the Excess Availability related to a Compliance Period to 20%; and (v) increase the Real Property Availability by including the Company’s Michigan real estate in the Borrowing Base.

On July 2, 2020, the Company completed the acquisition of certain assets which comprise the aftermarket vehicle remote start and security systems and connected car solutions (telematics) businesses from Directed LLC and Directed Electronics Canada Inc. The acquired assets include inventory, accounts receivable, certain fixed assets, IT systems, and intellectual property. The cash purchase price was $11,000, plus the assumption of various liabilities. On July 6, 2020, the Company issued a press release announcing the acquisition and on July 9, 2020, the Company filed a Form 8-K with a copy of the press release furnished as Exhibit 99.1 thereto.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OFOF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Certain information in this Quarterly Report on Form 10-Q would constitute forward-looking statements, including, but not limited to, information relating to the future performance and financial condition of the Company, the impact of the COVID-19 pandemic on our results of operations, the plans and objectives of the Company’s management, and the Company’s assumptions regarding such performance and plans that are forward-looking in nature and involve certain risks and uncertainties. Actual results could differ materially from such forward-looking information and could be exacerbated by the COVID-19 pandemic and any worsening of the global business and economic environment as a result.

We begin Management’s Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") with an overview of the business. This is followed by a discussion of the Critical Accounting Policies and Estimates that we believe are important to understanding the assumptions and judgments incorporated in our reported financial results. In the next section, we discuss our results of operations for the three and nine months ended ~~May 31,~~November 30, 2020 compared to the three and nine months ended ~~May 31,~~November 30, 2019. Next, we present EBITDA, Adjusted EBITDA, and Diluted Adjusted EBITDA per common share attributable to Voxx for the three and nine months ended ~~May 31,~~November 30, 2020 compared to the three and nine months ended ~~May 31,~~November 30, 2019, in order to provide a useful and appropriate supplemental measure of our performance. We then provide an analysis of changes in our balance sheets and cash flows and discuss our financial commitments in the sections entitled "Liquidity and Capital Resources." We conclude this MD&A with a discussion of "Related Party Transactions" and "Recent Accounting Pronouncements."

Unless specifically indicated otherwise, all amounts presented in our MD&A below are in thousands, except share and per share data.

VOXX International Corporation ("Voxx," "We," "Our," "Us" or the "Company") is a leading international manufacturer and distributor operating in the Automotive Electronics, Consumer Electronics, and Biometrics industries. The Company has widely diversified interests, with more than 30 global brands that it has acquired and grown throughout the years, achieving a powerful international corporate image, and creating a vehicle for each of these respective brands to emerge with its own identity. We conduct our business through ~~seventeen~~nineteen wholly-owned subsidiaries: Audiovox Atlanta Corp., VOXX Electronics Corporation, VOXX Accessories Corp., VOXX German Holdings GmbH ("Voxx Germany"), Audiovox Canada Limited, Voxx Hong Kong Ltd., Audiovox International Corp., Audiovox Mexico, S. de R.L. de C.V. ("Voxx Mexico"), Code Systems, Inc., Oehlbach Kabel GmbH ("Oehlbach"), Schwaiger GmbH ("Schwaiger"), Invision Automotive Systems, Inc. ("Invision"), ~~Klipsch Holding~~Premium Audio Company LLC ("Klipsch"), Omega Research and Development, LLC ("Omega"), Voxx Automotive Corp., Audiovox Websales LLC, ~~and~~ VSM-Rostra LLC, VOXX DEI LLC, and VOXX DEI Canada, Ltd., as well as a majority owned subsidiary, EyeLock LLC ("EyeLock"). We market our products under the Audiovox® brand name and other brand names and licensed brands, such as 808®, Acoustic Research®, Advent®, Avital®, Car Link®, Chapman®, Clifford®, Code-Alarm®, Crimestopper™, Directed®, Discwasher®, Energy®, Heco®, Invision®, Jamo®, Klipsch®, Mac Audio^™, Magnat®, Mirage®, myris®, Oehlbach®, Omega®, Prestige®, Project Nursery®, Python®, RCA®, RCA Accessories, Rosen®, Rostra®, Schwaiger®, Smart Start®, Terk®, Vehicle Safety Automotive, Viper® and Voxx Automotive, as well as private labels through a large domestic and international distribution network. We also function as an OEM ("Original Equipment Manufacturer") supplier to several customers, as well as market a number of products under exclusive distribution agreements, such as SiriusXM satellite radio ~~products.~~products and Onkyo & Pioneer Corp. products in North America.

During March 2020, a global pandemic was declared by the World Health Organization and a National Emergency was declared by the President of the United States related to the rapidly growing outbreak of COVID-19. The pandemic has significantly impacted ~~the~~ economic conditions in the United States, as federal, state, and local governments have reacted to the public health crisis, creating significant uncertainties in the United States, as well as the global economy. In the interest of public health and safety, U.S. jurisdictions (national, state, and local) where our primary operations and those of many of our customers are located ~~have~~ required mandatory business closures, ~~and~~ capacity limitations, or other restrictions for those ~~that have been~~ permitted to continue to operate or ~~that have been~~ allowed to ~~reopen.~~reopen since the initial shut-downs in March 2020. As of the date of this ~~report, 3~~filing, all of our operating locations ~~remain closed.~~are open, with certain locations operating at reduced capacity.

As a result of these developments, the ~~Company~~Company’s business has ~~experienced a significant decrease in revenue~~been impacted for the three and nine months ended ~~May 31,~~November 30, 2020. Although the Company’s revenues have increased for the three and nine months ended November 30, 2020, as compared to the prior year ~~period and anticipates an adverse impact on its revenues, results of operations, and cash flows for~~periods, sales within certain product lines across the ~~2021 fiscal year.~~Company’s segments have been negatively affected. The situation is still rapidly changing and additional impacts to the business may arise that we are not

aware of ~~currently.~~currently, which could have an adverse impact on revenues, results of operations, and cash flows for the 2021 fiscal year. We cannot predict whether, when, or the manner in which the ~~conditions~~conditions surrounding COVID-19 will change, including the timing of lifting any restrictions ~~or closure requirements~~ and/or any subsequent re-impositions. Due to the evolving situation, ~~the~~future results of ~~our second and third quarters of Fiscal 2021 and~~ the ~~full fiscal year ending February 28,~~

~~2021~~Company could be impacted in ways we are not able to predict today, including, but not limited to, non-cash write-downs and impairments; foreign currency fluctuations; potential adjustments to the carrying value of inventory; and the delayed collections of, or inability to collect accounts receivables.

During April 2020, as a precautionary measure to ensure financial flexibility and maintain maximum liquidity in response to the COVID-19 pandemic, the Company borrowed $20,000 from its Credit Facility in the U.S.~~, and on June 11, 2020, the Company amended the Credit Facility to extend its maturity date.~~ This $20,000 precautionary borrowing was repaid in November 2020. As of the date of this report, the Company continues to focus on cash flow and anticipates having sufficient resources to operate for the coming twelve-month period.

~~The~~In addition, the Company ~~has also~~ implemented a number of other measures in Fiscal 2021 to help mitigate the operating and financial impact of the pandemic, including: (i) furloughing approximately 20% of its employees ~~globally starting April 6, 2020;~~globally; (ii) implementing temporary salary and hour reductions for both management and non-management level employees Company-wide, including its executive officers, and the Company’s board of directors; (iii) executing substantial reductions in expenses, service provider costs, occupancy costs, capital expenditures and overall ~~costs, including through reduced inventory purchases;~~costs; and (iv) working globally with management teams to actively explore and identify all eligible government and other initiatives ~~available~~available to businesses or employees impacted by the COVID-19 pandemic. As of our ~~report~~filing date, ~~approximately 11%~~less than 1% of our employees worldwide ~~are still~~remain on furlough. The above-referenced temporary salary and hour reductions were eliminated by the Company during the three months ended November 30, 2020.

The Company operates in three reportable segments based on our products and internal organizational structure. The operating segments consist of Automotive Electronics, Consumer Electronics, and Biometrics. See Note 23 to the Company's Consolidated Financial Statements for segment information.

We believe our segments ~~may~~ have expanding market opportunities with certain levels of volatility related to domestic and international markets, new car sales, increased competition by manufacturers, private labels, technological advancements, discretionary consumer spending and general economic conditions. All of our products are subject to price fluctuations which

could affect the carrying value of inventories and gross margins in the future. Macroeconomic factors, such as increases in the unemployment rate, have been pressured as a result of the COVID-19 stay at home orders and have created a challenging demand environment in ~~many~~some of our markets, the duration and severity of which we are still unable to predict.

Our objective is to continue to grow our business by acquiring new brands, embracing new technologies, expanding product development, and applying this to a continued stream of new products that should increase gross margins and improve operating income. In addition, it is our intention to continue to acquire synergistic companies that would allow us to leverage our overhead, penetrate new markets and expand existing product categories through our business channels. Notwithstanding the above, if the appropriate opportunity arises, the Company will explore the potential divestiture of a product line or business.

~~There were no acquisitions or dispositions during~~On July 1, 2020, the ~~three months ended May 31, 2020.~~ Company completed the acquisition of certain assets and liabilities, which comprise the aftermarket vehicle remote start and security systems and connected car solutions (telematics) business from Directed LLC and Directed Electronics Canada Inc. (collectively, with Directed LLC, “Directed”) (see Note 2).

On January 31, 2020, the Company acquired certain assets and liabilities of Vehicle Safety Holdings Corp. (“VSHC”) (see Note 2).

The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses reported in those financial statements. These judgments can be subjective and complex, and consequently, actual results could differ from those estimates. Our most critical accounting policies and estimates relate to revenue recognition; accrued sales incentives; expected credit losses on accounts receivable; inventory valuation; valuation of long-lived assets; valuation and impairment assessment of goodwill, trademarks, and other intangible assets; warranties; stock-based compensation; recoverability of deferred tax assets; and the reserve for uncertain tax positions at the date of the consolidated financial statements. A summary of the Company's critical accounting policies is identified in Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company's Form 10-K for the fiscal year ended February 29, 2020. During the fourth quarter of the Company’s 2020 fiscal year, as well as subsequent to February 29, 2020, there have been significant changes to the global economic situation as a consequence of the COVID-19 pandemic. It is ~~reasonably~~ possible that this could cause changes to estimates in the future as a result of the financial circumstances of the markets in which the Company operates, the price of the Company’s publicly traded equity in comparison to the Company’s carrying value, and the health of the global economy. Such changes to estimates could potentially result in impacts that would be material to the consolidated financial statements, particularly with respect to the fair value of the Company’s reporting units in relation to potential goodwill impairment and the fair value of long-lived assets in relation to potential impairment. Since February 29, 2020, there have been no changes in our critical accounting policies, with the exception of the Company’s adoption of ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” on March 1, 2020. ~~(see Note 26).~~

As you read this discussion and analysis, refer to the accompanying Unaudited Consolidated Statements of Operations and Comprehensive Income (Loss) ~~Income,~~, which present the results of our operations for the three and nine months ended ~~May 31,~~November 30, 2020 and 2019.

The following tables set forth, for the periods indicated, certain statements of operations data for the three and nine months ended ~~May 31,~~November 30, 2020 and 2019.

	May 31,										November 30,
	2020		2019		$ Change			% Change			2020		2019		$ Change		% Change
Three Months Ended
Automotive Electronics	$	17,276	$	29,642	$	(12,366	)		(41.7	)%	$	61,488	$	29,985	$	31,503		105.1	%
Consumer Electronics		54,514		63,653		(9,139	)		(14.4	)%		139,039		79,914		59,125		74.0	%
Biometrics		97		6		91			1516.7	%		343		138		205		148.6	%
Corporate		100		153		(53	)		(34.6	)%		195		75		120		160.0	%
Total net sales	$	71,987	$	93,454	$	(21,467	)		(23.0	)%	$	201,065	$	110,112	$	90,953		82.6	%

Nine Months Ended
Automotive Electronics											$	111,397	$	86,472	$	24,925		28.8	%
Consumer Electronics												288,545		206,601		81,944		39.7	%
Biometrics												703		398		305		76.6	%
Corporate												439		341		98		28.7	%
Total net sales											$	401,084	$	293,812	$	107,272		36.5	%

Automotive sales represented ~~24.0%~~30.6% and 27.8% of the net sales for the three and nine months ended ~~May 31,~~November 30, 2020, respectively, compared to ~~31.7%~~27.2% and 29.4% in the respective prior year ~~period.~~periods. Sales in this segment ~~decreased~~increased during both the three and nine months ended ~~May 31,~~November 30, 2020, as compared to the prior year ~~primarily as a result~~periods. The primary driver of sales increases in this segment for both periods were sales of OEM and aftermarket products related to the Company’s VSM and DEI subsidiaries, established in connection with the Company’s acquisitions in the fourth quarter of Fiscal 2020 and the second quarter of Fiscal 2021, respectively. Sales from these two new subsidiaries comprised approximately 49% and 41% of the segment’s sales for the three and nine months ended November 30, 2020, respectively, neither of which was present in the prior year periods. The Company also saw an increase in sales of its aftermarket security and remote start products during the three and nine months ended November 30, 2020, respectively, partly due to a boost in demand following business re-openings after the COVID-19 ~~pandemic, which caused~~shut-downs, as purchases could not be made by customers during the ~~temporary~~shut-downs. During the three months ended November 30, 2020, there was an increase in sales of the Company’s OEM rear seat entertainment products due to a pick-up in sales following the shut-downs, ~~of many business operations throughout the U.S., and globally, during our first quarter,~~ as well as due to the successful launch of a new program with one of its customers in October 2020. Offsetting these increases, the segment experienced sales declines in certain product lines during the three and nine months ended November 30, 2020 related to the COVID-19 pandemic, as well as certain other factors. The Company’s OEM ~~rear seat entertainment, security, and~~ remote start sales ~~all declined~~decreased during both the three and nine months ended ~~May 31,~~November 30, 2020 ~~primarily~~ as a result of an increase in the use of Tier 1 factory installed remote start products by many automotive manufacturers (which the Company does not sell) over accessory level remote starts. This has negatively impacted the Company’s sales to certain of its OEM remote start customers. Sales of aftermarket headrest products also decreased during the three and nine months ended November 30, 2020 due to the COVID-19 related shut-downs of car dealerships and other brick and mortar businesses during the first quarter of the year, followed by stock-outages of several products in the third quarter, which continued to negatively impact sales. For the nine months ended November 30, 2020, the Company experienced a decrease in sales of OEM rear seat entertainment products due to several automotive manufacturing plant shut-downs beginning in March 2020 as a result of COVID-19, including Ford, GM,

FCA, and ~~Subaru, beginning in March 2020. Some of these automotive~~Subaru. Many plants ~~only~~ began to gradually re-open during ~~May 2020.~~the second quarter of our fiscal year, and while some of the programs have begun to ramp up production again, others have yet to return to pre-COVID levels, thus negatively impacting sales for the year-to-date period. Additionally, OEM rear seat entertainment sales were negatively impacted during the ~~three~~nine months ended ~~May 31,~~November 30, 2020 by the cancellation of a program with one of the Company’s larger customers that had been in production during the prior year period. ~~Sales~~

Consumer Electronics sales represented 69.2% and 71.9% of ~~aftermarket headrest, remote start,~~our net sales for the three and ~~security products decreased as a result of COVID-19 due~~nine months ended November 30, 2020, respectively, compared to ~~the temporary shut-down of car dealerships~~72.6% and ~~other brick and mortar business that sell these products. Sales of satellite radio products have declined~~70.3% in the comparable prior year periods. Sales increased for the three and nine months ended ~~May 31,~~November 30, 2020 as compared to the prior year due primarily to the positive sales and promotion of several of the Company’s premium audio products. During both the three and nine months ended November 30, 2020, the Company experienced greater consumer demand and achieved market share growth in its premium home theater and subwoofer categories, and launched a new premium wireless computer speaker system, which has contributed positively to sales in both periods and was not available in the prior fiscal year. The Company also experienced increased sales of premium mobility products due to the discounting of older wireless ear buds in preparation for the launch of new product. Sales of hookup products increased during the three and nine months ended November 30, 2020 due to the large number of individuals working from home as a result of the COVID-19 pandemic, which caused an increase in demand for cabling and other hookup related products. Within Europe, the ~~temporary shut-down of businesses selling these products,~~Company experienced stronger online sales during the three and nine months ended November 30, 2020 due to many consumers shopping from home during the pandemic, as well as ~~a result of~~ an increase in ~~standard factory equipped vehicles with these options. Offsetting the~~ sales ~~declines~~ in ~~this segment for~~its Do It Yourself (“DIY”) line of products, a new sales channel of discount retailers, and a shift in focus of premium audio products

in Europe from low margin to traditional home theater products, which has contributed positively to sales. Additionally, during the three and nine months ended ~~May 31,~~November 30, 2020, the Company’s newly formed subsidiary, 11 Trading Company LLC, began selling Onkyo and Pioneer products through new distribution agreements. Offsetting these sales increases were ~~increases~~decreases in sales ~~of both OEM and aftermarket products~~ related ~~to the Company’s acquisition of VSHC during the fourth quarter of Fiscal 2020, which comprised approximately 28% of the segment’s sales for the three months ended May 31, 2020.~~

Consumer Electronics sales represented 75.7% of our net sales for the three months ended May 31, 2020, compared to 68.1% in the comparable prior year period. Sales decreased for the three months ended May 31, 2020 as compared to the prior year due to the COVID-19 pandemic, as well as other factors. The Company experienced decreases in sales of certain consumer electronic and accessory products, such as in wireless and bluetooth speakers, due to a reduction in product placement with certain customers, as well as the delay in orders as a result of COVID-19; in the Project Nursery line, as a result of the elimination of baby video monitors during the prior fiscal year; in smart home products, as the Company began exiting this category during Fiscal 2020; in activity bands, as a result of promotions offered in the prior year period that did not repeat in the current year; and in reception products ~~remotes, power products,~~ and ~~headphones,~~wireless speakers, primarily due to nationwide brick and mortar business closures related to the COVID-19 pandemic, delayed customer orders due to the pandemic, as well as due to the Company’s continuing rationalization of SKU’s for certain of these products, with the goal of limiting sales of lower margin products. For the three and nine months ended ~~May 31,~~November 30, 2020, there was also a decrease in sales of the Company’s ~~premium home separate speaker products, as a result of the closing of many brick and mortar stores due to COVID-19, with online platforms focused more on essential goods, as well as a decrease in~~ premium commercial speaker products due to the shut-down of cinemas during the pandemic. ~~Within Europe,~~Additionally, one of the Company’s healthcare programs ended in September 2020, resulting in a decrease in sales of its motion products for both the three and nine months ended November 30, 2020. For the nine months ended November 30, 2020, sales of the Company’s smart home products decreased, as the Company ~~experienced decreases in sales across all product lines, including Do It Yourself (“DIY”),~~began exiting this category during the three months ended May 31, 2020 directly as a result of the impact of the COVID-19 pandemic in Europe. Offsetting these decreases, the Company experienced an increase in sales within both of its premium mobility and premium wireless and bluetooth speaker categories as a result of the launch of new lines of soundbars and wireless earbuds during the second quarter of Fiscal ~~2020, as well as continued strong sales of several existing products.~~2020.

Biometrics sales represented ~~0.1%~~0.2% of our net sales for both the three and nine months ended ~~May 31,~~November 30, 2020, compared to ~~0.01%~~0.1% in both of the respective prior year ~~period. This segment experienced~~periods. Sales during the three and nine months ended November 30, 2020 increased compared to the prior year periods due to an increase in ~~product~~ sales ~~for the three months ended May 31, 2020 as the Company began selling~~of its EXT outdoor perimeter access product, ~~as well as an~~and the updated version of its Nano NXT perimeter access product, ~~during~~both of which launched in the second quarter of Fiscal 2020. Additionally, the Company began selling its NIXT product during the three months ended November 30, 2020, which can be optionally fitted with iTEMP, a product that can take an individual’s temperature before allowing iris access.

	May 31,												November 30,
	2020			2019			$ Change			% Change			2020			2019			$ Change		% Change
Three Months Ended
Automotive Electronics	$	3,056		$	6,628		$	(3,572	)		(53.9	)%	$	15,777		$	6,023		$	9,754		161.9	%
		17.7	%		22.4	%								25.7	%		20.1	%
Consumer Electronics		16,844			19,120			(2,276	)		(11.9	)%		42,109			25,627			16,482		64.3	%
		30.9	%		30.0	%								30.3	%		32.1	%
Biometrics		(22	)		109			(131	)		(120.2	)%		50			(39	)		89		228.2	%
		-22.7	%		1816.7	%								14.6	%		(28.3	)%
Corporate		98			152			(54	)		(35.5	)%		192			(147	)		339		230.6	%
	$	19,976		$	26,009		$	(6,033	)		(23.2	)%	$	58,128		$	31,464		$	26,664		84.7	%
		27.7	%		27.8	%								28.9	%		28.6	%

Nine Months Ended
Automotive Electronics													$	25,555		$	18,228		$	7,327		40.2	%
														22.9	%		21.1	%
Consumer Electronics														90,166			63,040			27,126		43.0	%
														31.2	%		30.5	%
Biometrics														28			13			15		115.4	%
														4.0	%		3.3	%
Corporate														430			(39	)		469		1202.6	%
													$	116,179		$	81,242		$	34,937		43.0	%
														29.0	%		27.7	%

Gross margin percentages for the Company have ~~decreased 10~~increased 30 and 130 basis points for the three and nine months ended ~~May 31,~~November 30, 2020, respectively, as compared to the three and nine months ended ~~May 31,~~November 30, 2019.

Gross margin percentages in the Automotive Electronics segment ~~decreased~~ ~~470~~increased 560 and 180 basis points for the three and nine months ended ~~May 31,~~November 30, 2020, respectively, as compared to the prior year ~~period.~~periods. The ~~decrease~~primary driver of the margin increases in this segment has been sales of OEM and aftermarket products related to the Company’s VSM and DEI subsidiaries, whose products have higher profit margins ~~was driven primarily~~than those typically achieved by the ~~declines~~segment, and whose sales were not present in the prior year periods. The increase in sales of higher margin aftermarket remote start and security products also contributed positively to the segment’s margins during the three and nine months ended November 30, 2020, and for the three months ended November 30, 2020, an increase in sales of the Company’s OEM rear seat entertainment products positively impacted margins for the segment. Offsetting these positive impacts, the decline in sales of higher margin OEM security and remote start ~~sales,~~products during the three and nine months ended November 30, 2020 due to ~~automotive manufacturing shut-downs during~~ the ~~quarter as~~shift in demand from accessory level remote starts to production level, factory installed remote starts caused a ~~result of the COVID-19 pandemic.~~decline in margins in both periods. In addition,

there was a decline in aftermarket headrest ~~remote start,~~sales during the three and ~~security product sales,~~nine months ended November 30, 2020, which typically generate higher margins for the segment and also declined as a result of sales decreases resulting from pandemic related business shut-downs. As an offset to these margin declines during the three months ended May 31, 2020, the Automotive Electronics segment experienced declines in satellite radio sales, which contribute lower margins to the group,

~~while increased sales of OEM and aftermarket products related to its acquisition of VSHC in the fourth quarter of Fiscal 2020 contributed favorably to~~thus negatively impacted margins for ~~the three months ended May 31, 2020.~~both periods.

Gross margin percentages in the Consumer Electronics segment ~~increased 90~~decreased 180 basis points for the three months ended ~~May 31,~~November 30, 2020, but increased 70 basis points for the nine months ended November 30, 2020 as compared to the prior year ~~period.~~periods. Margin ~~increases~~declines during the three and nine months ended November 30, 2020 were primarily driven by the Company’s newest line of premium wireless computer speakers, which have contributed positively to sales, but have been sold at lower margins than those typically associated with the Company’s premium wireless speaker products, particularly during the three months ended ~~May 31,~~November 30, 2020 ~~were driven~~as a result of holiday promotions. The Company’s premium headphone margins have also been negatively impacted in ~~part by~~the three and nine months ended November 30, 2020 due to close out sales of certain older products at lower margins in preparation for the launch of its newest line of wireless earbuds. Additionally, although sales in Europe have increased in the three and nine months ended November 30, 2020, the increase in sales generated from a new sales channel of discount retail customers has generated lower margins and had a negative impact on both periods. As an offset to these negative impacts, the segment has experienced increases in margins during both the three and nine months ended November 30, 2020 due to factors including the increased sales of the Company’s high margin premium ~~wireless and bluetooth speakers. Margins were also positively impacted by a decrease~~home theater speaker products, as well as an increase in sales of ~~activity bands~~hookup products in both periods. In Europe, a shift in focus of premium audio products from low margin to traditional home theater products, as well as less discounting of product, contributed positively to both sales and overall margins related to this product line. Additionally, while the Company experienced decreases in sales of certain product lines during the three and nine months ended ~~May 31,~~November 30, 2020, such as reception products and remotes, the margins earned on these products ~~typically generate lower margins for~~improved during both periods as compared to the ~~Company. Margins have been negatively affected~~prior year, due to the movement of production out of China. Finally, sales within the Company’s newly formed subsidiary, 11 Trading Company LLC, which began selling Onkyo and Pioneer products through new distribution agreements during the three and nine months ended ~~May 31,~~November 30, 2020, ~~by declining sales of products with typically higher~~has contributed positively to margins ~~such as non-premium wireless and bluetooth speakers, reception products, remotes, and the Company’s Project Nursery product line, as well by sales declines within the European market.~~in both periods.

Gross margin percentages in the Biometrics segment ~~decreased for~~improved in both the three and nine months ended ~~May 31,~~November 30, 2020 as compared to the respective prior year ~~period.~~periods. The ~~decrease~~increase in margins for the three and nine months ended November 30, 2020 was primarily ~~due~~a result of prior year events that negatively impacted the segment’s margins in Fiscal 2020. Certain tooling and defective repair costs incurred in the three and nine months ended November 30, 2019, as well as the provision of beta samples to certain customers at no cost during the prior year periods, negatively impacted margins in the prior fiscal year. A large sale made at a loss during the nine months ended November 30, 2019 also caused lower margins in the prior year to date period. In the current year, the Company provided more onsite and remote support to customers during the three and nine months ended November 30, 2020, which generates higher margins for the segment. Offsetting these positive margin impacts for the three and nine months ended November 30, 2020 has been the reduction in pricing on certain products, which has helped to drive higher sales in Fiscal 2021, but has resulted in lower margins for the segment. Additionally, the release of inventory reserves ~~during~~in the ~~three months ended May 31, 2019 that~~comparable prior year periods had a positive impact on the segment’s gross margin infor the prior ~~year.~~year, thus negatively impacting the current year margin comparisons.

	May 31,										November 30,
	2020		2019		$ Change			% Change			2020		2019		$ Change			% Change
Three Months Ended
Operating expenses:
Selling	$	8,362	$	9,881	$	(1,519	)		(15.4	)%	$	12,761	$	9,580	$	3,181			33.2	%
General and administrative		14,995		17,425		(2,430	)		(13.9	)%		21,128		16,689		4,439			26.6	%
Engineering and technical support		4,485		5,807		(1,322	)		(22.8	)%		5,676		5,059		617			12.2	%
Total operating expenses	$	27,842	$	33,113	$	(5,271	)		(15.9	)%	$	39,565	$	31,328	$	8,237			26.3	%

Nine Months Ended
Operating expenses:
Selling											$	30,190	$	28,162	$	2,028			7.2	%
General and administrative												51,668		51,896		(228	)		(0.4	)%
Engineering and technical support												14,942		15,901		(959	)		(6.0	)%
Total operating expenses											$	96,800	$	95,959	$	841			0.9	%

Total operating expenses have ~~decreased~~increased for the three and nine months ended ~~May 31,~~November 30, 2020 as compared with the prior year ~~period.~~periods.

~~Selling~~For both the three and nine months ended November 30, 2020, the Company experienced a net increase in selling expenses. Increases in selling expenses were primarily attributable to increases in commission expense during both the three and nine months ended November 30, 2020 as a result of higher sales. Salary expense also increased for the three and nine months ended November 30, 2020 due to the additional headcount created by acquisitions resulting in the establishment of the VSM and DEI subsidiaries in the fourth quarter of Fiscal 2020 and the second quarter of Fiscal 2021, respectively, as well as additional hires related to the Company’s distribution agreements for Onkyo and Pioneer products. While advertising expense decreased for the ~~three~~nine months ended ~~May 31,~~November 30, 2020 due ~~primarily~~to the COVID-19 pandemic closure and phased re-opening of many brick and mortar stores during the year, web advertising expenses increased in both periods due to an increase in online traffic, with many consumers working and shopping from home during the mandatory quarantines and business shut-downs throughout the country. Offsetting these increases in selling expenses for the three and nine months ended November 30, 2020, were decreases due to factors related to the COVID-19 pandemic, which resulted in the temporary shut-down of many brick and mortar stores and mandatory quarantine orders ~~throughout the United States, as well as globally,~~ during ~~the majority of~~ the first quarter of our Fiscal 2021 ~~year.~~year, with phased re-openings taking place beginning in the second quarter. Company-wide furloughs and pay reductions at all levels, as well as the elimination of all non-essential travel, resulted in a ~~significant~~ decrease in salary and travel and entertainment ~~expense~~expenses for the ~~three~~nine months ended ~~May 31,~~November 30, 2020. ~~Trade~~Pay reductions and most of the Company’s furloughs ended in the third quarter of Fiscal 2021; however, non-essential travel was still limited through November 30, 2020, affecting both periods. Additionally, trade show expenses ~~also~~ decreased for both the three and nine months ended November 30, 2020 as a result of the cancellation of all events ~~for the quarter~~year-to-date due to COVID-19. Offsetting these decreases was an increase in salary expense as a result of additional headcount due to the Company’s acquisition of VSHC during the fourth quarter of Fiscal 2020. Additionally, while advertising expense decreased during

For the three months ended ~~May 31,~~November 30, 2020, there was a net increase in general and administrative expenses, while there was a net decrease during the nine months ended November 30, 2020 as compared to the respective prior year periods. Increases to general and administrative expenses during both the three and nine months ended November 30, 2020 were due primarily to salary expense and professional fees. Increases in salary expense were due to higher bonus accruals for the ~~closing of many brick~~three and ~~mortar stores during the quarter, web advertising expenses increased in equal measure~~nine months ended November 30, 2020 as a result of the ~~increase~~positive performance of the Company. Professional fees were higher for both periods as the result of ongoing acquisition-related services provided in ~~online traffic,~~connection with ~~many consumers working~~the Company’s new DEI and ~~shopping from home~~VSM subsidiaries, as well as due to a stock grant awarded to the Company’s non-employee directors during the ~~mandatory quarantines and business shut-downs throughout~~third quarter of Fiscal 2021. During the ~~country.~~

~~General and administrative expenses decreased during the three~~nine months ended ~~May 31,~~November 30, 2020, insurance expense increased as a result of the deductible related to an IT security incident in the second quarter of the fiscal year, as well as due to the ~~impacts of~~Company’s new VSM, DEI, and 11 Trading Company LLC subsidiaries. As an offset to these general and administrative expense increases were decreases related to the COVID-19 pandemic, as well as other factors. Office and occupancy expenses decreased for both the three and nine months ended November 30, 2020 due to lower overhead, as certain of the Company’s offices were shut down during the first and second quarters of the fiscal year due to the COVID-19 pandemic, and most re-opened offices have remained at a reduced capacity through November 30, 2020. Bad debt expense decreased for the three and nine months ended November 30, 2020 as a result of the recovery of certain receivable balances that were previously written off. Depreciation and amortization expense also decreased, net, for the three and nine months ended November 30, 2020 as a result of the impairment of certain definite-lived intangible assets at EyeLock in the fourth quarter of Fiscal 2020, which reduced the amortizable base of these assets. This was offset by increases in depreciation and amortization expense related to newly acquired tangible and intangible assets within the VSM and DEI subsidiaries. Additionally, while the Company experienced a net increase in salary expense during both the three and nine months ended November 30, 2020, Company-wide furloughs and pay reductions at all levels due to the pandemic, as well as the elimination of non-essential travel, resulted in ~~a significant decrease in~~ salary and travel and entertainment expense ~~for~~decreases during the ~~three~~nine months ended ~~May 31,~~November 30, 2020. ~~Professional fees were also lower during the three months ended May 31, 2020 due primarily to the quarantine, as both the Company~~Pay reductions and many of its professional service providers had temporary office closures. Office expenses decreased during the three months ended May 31, 2020 as compared to the prior year due to lower overhead as a result of certainmost of the Company’s ~~offices being shut down during the pandemic quarantine, as well as other factors, including the sale of our property in Pulheim, Germany~~furloughs ended in the third quarter of Fiscal 2021; however, non-essential travel was still limited through November 30, 2020. Finally, during the second quarter of Fiscal 2020, ~~and~~ the ~~concurrent downsizing~~Company granted 200,000 fully vested shares of ~~office space, which has reduced office expenses~~Class A Common Stock to the Company’s Chief Executive Officer in ~~Europe, and certain hiring fees incurred~~accordance with his employment agreement, resulting in compensation expense of approximately $800 for the ~~prior year for consultants and other employee hires~~nine months ended November 30, 2019 that did not ~~recur~~repeat in the current ~~year period. The Company also incurred lower net depreciation~~fiscal year.

Engineering and ~~amortization expense during~~technical support expenses increased for the three months ended ~~May 31,~~November 30, 2020 and decreased for the nine months ended November 30, 2020 as ~~a result of~~compared to the ~~impairment of certain definite-lived intangible assets at EyeLock~~respective prior year periods. There were increases in salary expense during both the three and nine months ended November 30, 2020 driven by additional headcount and labor related to the Company’s new VSM and DEI subsidiaries established in connection with the Company’s acquisitions in the fourth quarter of Fiscal ~~2020. Offsetting the decreases to general~~2020 and ~~administrative expenses during the three months ended May 31, 2020 was an increase in depreciation and amortization expense as a result of the Company’s acquisition of VSHC during the fourth~~second quarter of Fiscal ~~2020, in which the Company acquired both tangible fixed assets~~2021, respectively. Research and ~~definite-lived intangible assets.~~

~~Engineering and technical support expenses~~development expense increased for the three months ended ~~May 31,~~November 30, 2020 ~~decreased as~~due to the timing of new product launches compared to the prior ~~year period, primarily as a result of~~year. For the ~~COVID-19 pandemic.~~nine months ended November 30, 2020, Company-wide furloughs and pay reductions at all levels, as well as the elimination of non-essential travel, ~~resulted in a significant decrease~~contributed to decreases in salary and travel and entertainment ~~expense for the~~

~~three months ended May 31, 2020. These declines were partially offset by an increase in research~~expense. Pay reductions and ~~development expenses and salary expense related to~~most of the Company’s ~~new VSHC subsidiary acquired during~~furloughs ended in the ~~fourth~~third quarter of Fiscal ~~2021.~~2021; however, non-essential travel was still limited through November 30, 2020, affecting both periods.

	May 31,												November 30,
	2020			2019			$ Change			% Change			2020			2019			$ Change			% Change
Three Months Ended
Interest and bank charges	$	(853	)	$	(997	)	$	144			14.4	%	$	(471	)	$	(751	)	$	280			37.3	%
Equity in income of equity investee		862			1,440			(578	)		(40.1	)%		1,761			967			794			82.1	%
Gain on sale of real property														—			4,057			(4,057	)		(100.0	)%
Investment gain														42			—			42			100.0	%
Other, net		534			1,644			(1,110	)		(67.5	)%		(121	)		(322	)		201			62.4	%
Total other income (expense)	$	543		$	2,087		$	(1,544	)		74.0	%
Total other income													$	1,211		$	3,951		$	(2,740	)		(69.3	)%

Nine Months Ended
Interest and bank charges													$	(2,334	)	$	(2,635	)	$	301			11.4	%
Equity in income of equity investee														4,506			3,672			834			22.7	%
Gain on sale of real property														—			4,057			(4,057	)		(100.0	)%
Investment gain														42			775			(733	)		(94.6	)%
Other, net														21			1,869			(1,848	)		(98.9	)%
Total other income													$	2,235		$	7,738		$	(5,503	)		(71.1	)%

Interest and bank charges represent interest expense and fees related to the Company's bank obligations, supply chain financing agreements and factoring agreements, interest related to finance leases, amortization of debt issuance costs, and credit card fees. For the three and nine months ended November 30, 2020, interest expense was lower due to reduced factoring and supply chain financing fees. While the Company sold a larger balance of customer accounts receivable during these periods as compared to the prior year, the related fees charged have been lower in Fiscal 2021.

Equity in income of equity investee represents the Company's share of income from its 50% non-controlling ownership interest in ASA Electronics LLC and Subsidiaries ("ASA"). The ~~decrease~~increase in income for the three and nine months ended ~~May 31,~~November 30, 2020 is due to an increase in ASA net income, primarily as a result of improved margins, lower overhead, and growth in the ~~impact~~RV and marine markets.

On September 30, 2019, the Company, through its subsidiary Voxx German Holdings Gmbh (the “Seller”), sold its real property in Pulheim, Germany to CLM S.A. RL (the “Purchaser”) for €10,920. Net proceeds received from the transaction were approximately $9,500 after transactional costs and repayment of the ~~COVID-19 pandemic~~outstanding mortgage. Concurrently with the sale, the Seller entered into an operating lease arrangement (“lease”) with the Purchaser for a small portion of the real property to continue to operate its sales office in Germany. The transaction qualified for sale leaseback accounting in accordance with ASC 842 and the Company recognized a gain on ~~ASA’s sales~~the execution of the sale transaction for the ~~period.~~three and nine months ended November 30, 2019.

During Fiscal 2018, the Company sold its investment in RxNetworks, a non-controlled corporation, consisting of shares of the investee’s preferred stock. Voxx recognized a gain during Fiscal 2018 on the sale of this investment; however, a portion of the cash proceeds were subject to a hold-back provision, and was not included in the gain recognized in Fiscal 2018. During the second quarter of Fiscal 2020, the hold-back provision expired, and the Company received the majority of the remaining proceeds from the sale, recording an investment gain of $775 for the nine months ended November 30, 2019. A final pay-out of $42 received in November 2020 was recorded as an investment gain for the three and nine months ended November 30, 2020.

Other, net includes net foreign currency gains or losses, interest income, rental income, and other miscellaneous income and expense. Other, net decreased for the three months ended May 31, 2020. Included within miscellaneous for the three months ended May 31, 2020 are the proceeds from a key man life insurance policy in the amount of $444 related to a Company executive who passed away during the quarter. During the three and nine months ended ~~May 31,~~November 30, 2020 interest income decreased as a result of lower interest rates applicable to the Company’s short-term money market investments. Additionally, during the nine months ended November 30, 2020, the Company had foreign currency losses of $(445) as compared to foreign currency gains of $297 for the nine months ended November 30, 2019. During the nine months ended November 30, 2019, the Company received the proceeds ~~from~~of a key man life insurance policy in the amount of $1,000, related to a former employee of Klipsch Group, Inc. that Voxx became the beneficiary of in conjunction with the acquisition of Klipsch in Fiscal ~~2012. Additionally, interest income decreased during~~2012, which were offset by a charge of $804 related to a payment made to TE Connectivity Ltd. in final settlement of the working capital calculation related to the Fiscal 2018 sale of Hirschmann Car Communication GmbH. This settlement impacted both the three and nine months ended ~~May 31, 2020 as a result of lower interest rates applicable to the Company’s short-term money market investments.~~November 30, 2019.

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was enacted in response to the COVID-19 pandemic. The CARES Act made various tax law changes including among other things (i) increased the limitation under IRC Section 163(j) for 2019 and 2020 to permit additional expensing of interest (ii) enacted a technical corrections so that qualified improvement property can be immediately expensed under IRC Section 168(k) and net operating losses arising in tax years beginning in 2017 and ending in 2018 can be carried back two years and carried forward twenty years without a taxable income limitation as opposed to carried forward indefinitely, and (iii) made modifications to the federal net operating loss rules including permitting federal net operating losses incurred in 2018, 2019, and 2020 to be carried back to the five preceding taxable years. With respect to the technical correction to net operating losses, the Company recorded a discrete income tax provision of $4,275 during the ~~three~~nine months ended ~~May 31,~~November 30, 2020, as its valuation allowance related to net operating losses with limited carryforward periods increased.

For the three months ended ~~May 31,~~November 30, 2020, the Company recorded an income tax provision of ~~$1,781,~~$2,334, which includes a discrete income tax benefit of $542 related primarily to the finalization of the federal and certain state tax return filings. For the three months ended November 30, 2019, the Company recorded an income tax provision of $2,720, which includes a discrete income tax provision of ~~$4,292.~~$1,035. The Company recorded a discrete ~~income~~ tax provision of ~~$4,275~~$1,153 in connection with excluding the U.S. tax jurisdiction from the estimated annual effective tax rate and a discrete tax benefit of $118 primarily related to ~~an increase in valuation allowance~~the reversal of uncertain tax provision liabilities as a result of the ~~technical correction to net operating losses as provided in~~lapse of the ~~CARES Act,~~applicable statute of limitations, the remeasurement of deferred tax assets and ~~a discrete~~liabilities for enacted state law changes, offset by an income tax provision ~~of $17,~~ related to the ~~accrual for interest for unrecognized~~finalization of federal and state tax ~~benefits. For~~filings during the ~~three months~~quarter ended ~~May 31, 2019, the Company recorded an income tax benefit of $2,645, which includes a discrete income tax provision of $19, related to the accrual of interest for unrecognized tax benefits.~~November 30, 2019.

The effective tax rates for the three months ended ~~May 31,~~November 30, 2020 and 2019 were an income tax provision of ~~24.3%~~11.8% on pre-tax income of ~~$7,324~~$19,774 and an income tax ~~benefit~~provision of ~~52.7%~~66.6% on a pre-tax ~~loss~~income of ~~$5,017.~~$4,087, respectively. The effective tax rate for the three months ended ~~May 31,~~November 30, 2020 differs from the U.S. statutory rate of 21% primarily due to the anticipated reversal of a portion of the U.S. valuation allowance based on projected current year earnings, immediate U.S. taxation of foreign earnings, non-controlling interest related to EyeLock LLC, state and local income taxes, nondeductible permanent differences, and income taxed in foreign jurisdictions at varying tax rates. The effective tax rate for the three months ended ~~May 31,~~November 30, 2019 differed from the statutory rate of 21% primarily due to the calculation of the U.S. tax provision on a discrete basis, the U.S. taxation of foreign earnings, nondeductible permanent differences, non-controlling interest related to EyeLock LLC, an increase in the valuation allowance, state and local income taxes, and income taxed in foreign jurisdictions at varying tax rates.

For the nine months ended November 30, 2020, the Company recorded an income tax provision of $6,724, which includes a discrete income tax provision of $3,609. The Company recorded a discrete tax provision of $4,275 related to an increase in valuation allowance as a result of the technical correction to net operating losses as provided in the CARES Act, and a discrete income tax benefit of $697 related to finalization of federal and state tax filings during the quarter ended November 30, 2020, and the reversal of uncertain tax provision liabilities as a result of the lapse of the applicable statute of limitations, offset with a discrete tax provision of $31 related to the accrual for interest for unrecognized tax benefits. For the nine months ended November 30, 2019, the Company recorded an income tax provision of $1,190, which includes a discrete income tax benefit of $345. The Company recorded a discrete tax benefit of $50 in connection with excluding the U.S. tax jurisdiction from the estimated annual effective tax rate, and a discrete income tax benefit of $295 primarily related to the reversal of uncertain tax provision liabilities as a result of the lapse of the applicable statute of limitations, the remeasurement of deferred tax assets and liabilities for enacted state law changes, offset by an income tax provision related to the finalization of federal and state tax filings during the quarter ended November 30, 2019.

rates. The ~~estimated annual~~ effective tax rate for the ~~fiscal year~~nine months ended ~~February 28, 2021 is 35.9%. The~~November 30, 2019 differed from the statutory rate of 21% primarily due to the calculation of the ~~estimated annual effective tax rate is based~~U.S. taxation provision on ~~our annual pretax income forecast which includes profitable jurisdictions anticipating~~a discrete basis, the U.S. taxation of foreign earnings, nondeductible permanent differences, non-controlling interest related to EyeLock LLC, an income tax provision and loss jurisdictions for which a limited tax benefit can be recognized. If the annual pretax income forecast is achieved for the remainder of the fiscal year, the Company anticipates recognizing an income tax provisionincrease in the ~~subsequent quarters of Fiscal 2021.~~valuation allowance, state and local income taxes, and income taxed in foreign jurisdictions at varying tax rates.

EBITDA, Adjusted EBITDA, and Diluted Adjusted EBITDA per common share are not financial measures recognized by GAAP. EBITDA represents net income (loss) ~~income~~ attributable to VOXX International Corporation, computed in accordance with GAAP, before interest expense and bank charges, taxes, and depreciation and amortization. Adjusted EBITDA represents

EBITDA adjusted for stock-based compensation expense, ~~as well as~~certain settlements, gains, and life insurance proceeds. Depreciation, amortization, and stock-based compensation are non-cash items. Diluted Adjusted EBITDA per common share represents the Company's diluted earnings per common share based on Adjusted EBITDA.

We present EBITDA, Adjusted EBITDA, and Diluted Adjusted EBITDA per common share in this Form 10-Q because we consider them to be useful and appropriate supplemental measures of our performance. Adjusted EBITDA and Diluted Adjusted EBITDA per common share help us to evaluate our performance without the effects of certain GAAP calculations that may not have a direct cash impact on our current operating performance. In addition, the exclusion of certain costs or gains relating to certain events allows for a more meaningful comparison of our results from period-to-period. These non-GAAP measures, as we define them, are not necessarily comparable to similarly entitled measures of other companies and may not be an appropriate measure for performance relative to other companies. EBITDA, Adjusted EBITDA, and Diluted Adjusted EBITDA per common share should not be assessed in isolation from, are not intended to represent, and should not be considered to be more meaningful measures than, or alternatives to, measures of operating performance as determined in accordance with GAAP.

Reconciliation of GAAP Net Income Attributable to VOXX International Corporation to EBITDA, Adjusted EBITDA, and Diluted Adjusted EBITDA per Common Share

	Three months ended May 31,						Three months ended November 30,						Nine months ended November 30,
	2020			2019			2020			2019			2020			2019
Net loss attributable to VOXX International Corporation	$	(8,272	)	$	(1,148	)
Net income (loss) attributable to VOXX International Corporation							$	18,251		$	2,464		$	17,319		$	(4,648	)
Adjustments:
Interest expense and bank charges (1)		715			878			325			625			1,907			2,269
Depreciation and amortization (1)		2,509			2,761			2,904			2,796			8,128			8,313
Income tax expense (benefit)		1,781			(2,645	)
Income tax expense								2,334			2,720			6,724			1,190
EBITDA		(3,267	)		(154	)		23,814			8,605			34,078			7,124
Stock-based compensation		351			159			768			471			1,454			1,816
Gain on sale of real property								—			(4,057	)		—			(4,057	)
Settlement of Hirschmann working capital								—			804			—			804
Investment gain								(42	)		—			(42	)		(775	)
Life insurance proceeds		(444	)		(1,000	)		—			—			(420	)		(1,000	)
Adjusted EBITDA	$	(3,360	)	$	(995	)	$	24,540		$	5,823		$	35,070		$	3,912
Diluted loss per common share attributable to VOXX International Corporation	$	(0.34	)	$	(0.05	)
Diluted income (loss) per common share attributable to VOXX International Corporation							$	0.74		$	0.10		$	0.71		$	(0.19	)
Diluted Adjusted EBITDA per common share attributable to VOXX International Corporation	$	(0.14	)	$	(0.04	)	$	0.99		$	0.24		$	1.43		$	0.16

As of ~~May 31,~~November 30, 2020, we had working capital of ~~$161,551~~$163,034 which includes cash and cash equivalents of ~~$69,039,~~$21,337, compared with working capital of $146,798 at February 29, 2020, which included cash and cash equivalents of $37,425. We plan to utilize our current cash position as well as collections from accounts receivable, the cash generated from our operations, when applicable, and the income on our investments to fund the current operations of the business. However, we may utilize all or a portion of current capital resources to pursue other business opportunities, including acquisitions, or to further pay down our debt. As of ~~May 31,~~November 30, 2020, we had cash amounts totaling ~~$3,172~~$3,742 held in foreign bank accounts, none of which would be subject to United States federal income taxes if made available for use in the United States. The Tax Cuts and Jobs Act provides a 100% participation exemption on dividends received from foreign corporations after January 1, 2018 as the United States has moved away from a worldwide tax system and closer to a territorial system for earnings of foreign corporations.

Operating activities ~~provided~~used cash of ~~$12,285~~$2,628 for the ~~three~~nine months ended ~~May 31,~~November 30, 2020 due to factors including ~~decreases~~the increase in both accounts receivable ~~driven in part by the Company’s domestic supply chain financing arrangements,~~and inventory, as well as ~~due to an increase in accounts payable. These operating cash inflows were~~losses incurred by EyeLock LLC. This was offset primarily by increases in accounts payable, accrued expenses, and sales ~~declines~~incentives. For the nine months ended November 30, 2019, operating activities used cash of $23,887 due to ~~COVID-19~~factors including sales declines and losses incurred by EyeLock LLC, as well as increases in accounts receivable due in part to the suspension of the Company’s domestic supply chain finance arrangements, increases in inventory, and decreases in accrued expenses. These operating cash usages were offset primarily by decreases in receivables from vendors and increases in accrued sales incentives. For the three months ended May 31, 2019, operating activities provided cash of $4,268 primarily due to the reduction of accounts receivable and vendor receivables, offset by a net decrease in accounts payable and accrued expenses, as well as sales declines and losses incurred by EyeLock LLC.

Investing activities used cash of ~~$586~~$14,510 during the ~~three~~nine months ended ~~May 31,~~November 30, 2020 primarily due the acquisition of the Directed business, as well as capital expenditures. For the ~~three~~nine months ended ~~May 31,~~November 30, 2019, investing activities provided cash of $9,759 primarily due to the proceeds received from the sale of the Company’s real property in Pulheim, Germany, offset by capital expenditures.

Financing activities used cash of ~~$703 primarily as a result of capital expenditures.~~

~~Financing activities provided cash of $19,706~~$1,680 during the ~~three~~nine months ended ~~May 31,~~November 30, 2020 ~~primarily~~ due to the repayment of the Company’s precautionary borrowing of $20,000 from the Credit Facility, ~~borrowing,~~the repayment of the Magnat subsidiary’s Euro asset-based loan balance upon its expiration, repayments of finance leases, and the payment of deferred finance fees related to the amendment of the Credit Facility, offset by ~~repayments~~the precautionary borrowing of ~~bank obligations.~~$20,000 made in April 2020. During the ~~three~~nine months ended ~~May 31,~~November 30, 2019, financing activities used cash of ~~$1,536~~$11,563 primarily due to the repayment of bank ~~obligations.~~obligations, including the entire outstanding balance of Voxx Germany’s Euro asset-based loan facility, and the repurchase of shares of the Company’s Class A common stock.

~~COVID-19 has had an adverse effect on our business and we expect it to continue to do so while the pandemic continues to affect the global community.~~ Federal, state, and local governments have taken a variety of actions to contain the spread of COVID-19. Many jurisdictions ~~have~~ required mandatory business closures orduring the Company’s fiscal year and imposed capacity limitations and other restrictions affecting our operations. ~~Some~~Many of these restrictions ~~remain~~were lifted in ~~effect to a certain degree through the date of this Form 10-Q filing, while other restrictions have been lifted,~~phases throughout Fiscal 2021, but could return if there is a resurgence of the pandemic spread. We have proactively taken steps to increase available cash, including, but not limited to, utilizing existing supply chain financing and factoring agreements, and utilizing available funds under our existing Credit Facility. The Company ~~has~~ also implemented a number of other measures to help preserve liquidity, as further described in our Form 10-K for the year ended February 29, 2020.

~~As of May 31, 2020, the~~The Company has a senior secured credit facility (the "Credit Facility") that provides for a revolving credit facility with committed availability of up to $140,000, which may be increased, at the option of the Company, up to a maximum of $175,000. The Credit Facility also includes a $15,000 sublimit for letters of credit and a $15,000 sublimit for swingline loans.$127,500. The availability under the revolving credit line within the Credit Facility is subject to a borrowing base, which is based on eligible accounts receivable, eligible inventory and certain real estate, subject to reserves as determined by the lender, and is also limited by amounts outstanding under the Florida Mortgage (see Note 17(b)). The availability under the revolving credit line of the Credit Facility was ~~$43,769~~$107,033 as of ~~May 31,~~November 30, 2020.

All amounts outstanding under the Credit Facility will mature and become due on April 26, ~~2021;~~2022; however, it is subject to acceleration upon the occurrence of an Event of Default (as defined in the Credit Agreement). The Company may prepay any amounts outstanding at any time, subject to payment of certain breakage and redeployment costs relating to LIBOR Rate Loans. The commitments under the Credit Facility may be irrevocably reduced at any time, without premium or penalty as set forth in the agreement. On June 11, 2020, the Company amended the Credit Facility. Under the amendment, the committed availability of the revolving credit facility was revised to $127,500, and the maturity date of the Credit Facility was extended to April 26, 2022.

Generally, the Company may designate specific borrowings under the Credit Facility as either Base Rate Loans or LIBOR Rate Loans, except that Swingline Loans may only be designated as Base Rate Loans. Loans designated as LIBOR Rate Loans shall bear interest at a rate equal to the then applicable LIBOR rate plus a range of ~~1.75~~2.00 - ~~2.25%~~2.50%. Loans designated as Base Rate loans shall bear interest at a rate equal to the applicable margin for Base Rate Loans of ~~0.75~~1.00 - ~~1.25%~~1.50% as defined in the agreement.

Provided that the Company is in a Compliance Period (the period commencing on that day in which Excess Availability is less than ~~12.5%~~20.0% of the Maximum Revolver Amount and ending on a day in which Excess Availability is equal to or greater than ~~12.5%~~20.0% for any consecutive ~~30 day~~30-day period thereafter), the Credit Facility requires compliance with a financial covenant calculated as of the last day of each month, consisting of a Fixed Charge Coverage Ratio. The Credit Facility also contains covenants, subject to defined carveouts, that limit the ability of the loan parties and certain of their subsidiaries which are not loan parties to, among other things: (i) incur additional indebtedness; (ii) incur liens; (iii) merge, consolidate or dispose of a substantial portion of their business; (iv) transfer or dispose of assets; (v) change their name, organizational identification number, state or province of organization or organizational identity; (vi) make any material change in their nature of business; (vii) prepay or otherwise acquire indebtedness; (viii) cause any change of control; (ix) make any restricted junior payment; (x) change their fiscal year or method of accounting; (xi) make advances, loans or investments; (xii) enter into or permit any transaction with an affiliate of any borrower or any of their subsidiaries; (xiii) use proceeds for certain items; (xiv) issue or sell any of their stock; or (xv) consign or sell any of their inventory on certain terms. In addition, if excess availability under the Credit Facility were to fall below certain specified levels, as defined in the agreement, the lenders would have the right to assume dominion and control over the Company's cash.

The obligations under the loan documents are secured by a general lien on and security interest in substantially all of the assets of the borrowers and certain of the guarantors, including accounts receivable, equipment, real estate, general intangibles, and inventory. The Company has guaranteed the obligations of the borrowers under the Credit Agreement.

The Company has a Euro asset-based loan facility in Germany with a credit limit of €8,000 that expires on July 31, ~~2020.~~2023. The Company's subsidiaries Voxx German Holdings GmbH, Oehlbach Kabel GmbH, and Schwaiger GmbH are authorized to borrow funds under this facility for working capital purposes.

The Company also utilizes supply chain financing arrangements and factoring agreements as a component of our financing for working capital, which accelerates receivable collection and helps to better manage cash flow. Under the agreements, the Company has agreed to sell certain of its accounts receivable balances to banking institutions who have agreed to advance amounts equal to the net accounts receivable balances due, less a discount as set forth in the respective agreements (see Note 9). The balances under these agreements are accounted for as sales of accounts receivable, as they are sold without recourse. Cash proceeds from these agreements are reflected as operating activities included in the change in accounts receivable in the Company's Consolidated Statements of Cash Flows. Fees incurred in connection with the agreements are recorded as interest expense by the Company.

Certain contractual cash obligations and other commercial commitments will impact our short and long-term liquidity. At ~~May 31,~~November 30, 2020, such obligations and commitments are as follows:

	Amount of Commitment Expiration per Period										Amount of Commitment Expiration per Period
Contractual Cash Obligations	Total		Less than 1 Year		2-3 Years		4-5 Years		After 5 Years		Total		Less than 1 Year		2-3 Years		4-5 Years		After 5 Years
Finance lease obligation (1)	$	1,163	$	569	$	555	$	39	$	—	$	855	$	469	$	386	$	—	$	—
Operating leases (1)		3,210		870		1,423		722		195		4,924		1,111		1,692		980		1,141
Total contractual cash obligations	$	4,373	$	1,439	$	1,978	$	761	$	195	$	5,779	$	1,580	$	2,078	$	980	$	1,141
Other Commitments
Bank obligations (2)	$	20,617	$	617	$	20,000	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Stand-by and commercial letters of credit (3)		68		68		—		—		—		7,257		7,257		—		—		—
Other (4)		7,489		499		1,000		1,000		4,990		7,239		500		1,000		1,000		4,739
Contingent earn-out payments and other (5)		12		12		—		—		—
Pension obligation (6)		760		—		—		—		760
Unconditional purchase obligations (7)		84,578		84,578		—		—		—
Pension obligation (5)												818		—		—		—		818
Unconditional purchase obligations (6)												170,367		170,367		—		—		—
Total other commitments		113,524		85,774		21,000		1,000		5,750		185,681		178,124		1,000		1,000		5,557
Total commitments	$	117,897	$	87,213	$	22,978	$	1,761	$	5,945	$	191,460	$	179,704	$	3,078	$	1,980	$	6,698

We regularly review our cash funding requirements and attempt to meet those requirements through a combination of cash on hand, cash provided by operations, available borrowings under bank lines of credit and possible future public or private debt and/or equity offerings. At times, we evaluate possible acquisitions of, or investments in, businesses that are complementary to ours, which transactions may require the use of cash. We believe that our cash, other liquid assets, operating cash flows, credit

arrangements, and access to equity capital markets, taken together, provide adequate resources to fund ongoing operating expenditures for the next twelve months, including the intercompany loan funding we provide to our majority owned

subsidiary, EyeLock LLC. In the event they do not, we may require additional funds in the future to support our working capital requirements or for other purposes and may seek to raise such additional funds through the sale of public or private equity and/or debt financings as well as from other sources. No assurance can be given that additional financing will be available in the future or that if available, such financing will be obtainable on terms favorable when required.

We do not maintain any off-balance sheet arrangements, transactions, obligations, or other relationships with unconsolidated entities that would be expected to have a material current or future effect upon our financial condition or results of operations.

We are required to adopt certain new accounting pronouncements. See Note 26 to our consolidated financial statements included herein.

ITEM 3. QUANTITATIVE AND ~~QUALITATIVE~~QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Voxx conducts business in various non-U.S. countries, including Germany, Canada, Mexico, China, Denmark, the Netherlands, and France and thus is exposed to market risk for changes in foreign currency exchange rates. As a result, we have exposure to various foreign currency exchange rate fluctuations for revenues generated by our operations outside of the U.S., which can adversely impact our net income and cash flows. For the three and nine months ended ~~May 31,~~November 30, 2020, a uniform 10% strengthening of the U.S. dollar relative to the local currency of our foreign operations would have resulted in a decrease in sales of approximately ~~$1,200,~~$3,500 and ~~an increase~~$6,500, respectively, and in net ~~loss~~income of approximately ~~$50.~~$360 and $490, respectively. The effects of foreign currency exchange rates on future results would also be impacted by changes in sales levels or local currency prices.

While the prices we pay for products purchased from our suppliers are principally denominated in United States dollars, price negotiations depend in part on the foreign currency of foreign manufacturers, as well as market, trade, and political factors. The Company also has exposure related to transactions in which the currency collected from customers is different from the currency utilized to purchase the product sold in its foreign operations, and U. S. dollar denominated purchases in its foreign subsidiaries. The Company enters forward contracts to hedge certain euro-related transactions. The Company minimizes the risk of nonperformance on the forward contracts by transacting with major financial institutions. For the three and nine months ended ~~May 31,~~November 30, 2020, no unrealized ~~gains (losses) were~~losses recorded in ~~other~~Other comprehensive income (loss) associated with these ~~contracts.~~contracts were $242 and $707. A hypothetical 10% adverse change in the fair value of our forward exchange contracts would result in a negative impact of $47 on the fair value of these forward exchange contracts at November 30, 2020

We are also subject to risk from changes in foreign currency exchange rates from the translation of financial statements of our foreign subsidiaries and for long-term intercompany loans with the foreign subsidiaries. These changes result in cumulative translation adjustments, which are included in Accumulated other comprehensive (loss) income. At ~~May 31,~~November 30, 2020, we had translation exposure to various foreign currencies with the most significant being the Euro. A hypothetical 10% adverse change in the foreign currency exchange rates would result in a negative impact of ~~$19~~$98 on Other comprehensive income (loss) ~~income~~ for the ~~three~~nine months ended ~~May 31,~~November 30, 2020.

The Company continues to monitor the political and economic climate in Venezuela. Venezuela did not have sales for the three and nine months ended ~~May 31,~~November 30, 2020 and there were minimal cash related assets invested in Venezuela as of ~~May 31,~~November 30, 2020 that would be subject to government foreign exchange controls. The Company has certain long-lived assets in Venezuela, which are held for investment purposes and had no value as of ~~May 31,~~November 30, 2020.

Our earnings and cash flows are subject to fluctuations due to changes in interest rates on investment of available cash balances in money market funds and investment grade corporate and U.S. government securities. In addition, our bank loans expose us to changes in short-term interest rates since interest rates on the underlying obligations are either variable or fixed. In connection with the Florida Mortgage, we have debt outstanding in the amount of ~~$7,489~~$7,239 at ~~May 31,~~November 30, 2020. Interest on this mortgage is charged at 70% of 1-month LIBOR plus 1.54%. The Company currently has one interest rate swap for the Florida Mortgage with a notional amount of ~~$7,489~~$7,239 at ~~May 31,~~November 30, 2020. This swap locks the interest rate at 3.48% (inclusive of credit spread) on the Florida Mortgage through the mortgage end date of March 2026. The Company also has ~~debt outstanding with variable interest rates on one of its two~~a Euro asset-based lending ~~obligations~~facility in Germany with a variable rate, which did not have an outstanding balance at November 30, 2020 (see Note 17).

As of ~~May 31,~~November 30, 2020, the total net fair value of the interest rate swap recorded in other liabilities on our Unaudited Consolidated Balance Sheet is ~~$606,~~$552, which represents the amount that would be paid upon unwinding the interest rate swap agreement based on market conditions on that date. Changes in the fair value of this interest rate swap agreement is reflected as an adjustment to other assets or liabilities with an offsetting adjustment to Accumulated other comprehensive (loss) income.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rules 13a-15(e) and 15d-15(e) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this report, these disclosure controls and procedures are effective as of ~~May 31,~~November 30, 2020 to provide reasonable assurance that information required to be disclosed by the Company in its filing under the Exchange Act was recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission.

There were no material changes in our internal control over financial reporting (as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) during the ~~three~~nine months ended ~~May 31,~~November 30, 2020 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

See Note 25 of the Notes to the Unaudited Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q and Note 15 of the Form 10-K for the fiscal year ended February 29, 2020 for information regarding legal proceedings.

There have been no material changes from the risk factors previously disclosed in the Company’s Form 10-K for the fiscal year ended February 29, 2020.

We have an ongoing authorization from our Board of Directors to repurchase shares of the Company's Class A Common Stock. During the three and nine months ended ~~May 31,~~November 30, 2020, we did not repurchase any shares of the Company’s Class A Common Stock.

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 thereunto duly authorized.

Delaware (State or other jurisdiction of incorporation or organization)		13-1964841 (IRS Employer Identification No.)
2351 J Lawson Blvd., Orlando, Florida (Address of principal executive offices)		32824 (Zip Code)

(800) 645-7750 (Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:

Title of each class:	Trading Symbol:	Name of Each Exchange on which Registered
Class A Common Stock $.01 par value	VOXX	The Nasdaq Stock Market LLC

		Page
PART I	FINANCIAL INFORMATION

Item 1	FINANCIAL STATEMENTS
	Consolidated Balance Sheets at ~~May 31,~~November 30, 2020 (unaudited) and February 29, 2020	3
	Unaudited Consolidated Statements of Operations and Comprehensive Income (Loss) ~~Income~~ for the Three and Nine Months Ended ~~May 31,~~November 30, 2020 and 2019	4
	Unaudited Consolidated Statements of Stockholders’ Equity for the Three and Nine Months Ended ~~May 31,~~November 30, 2020 and 2019	5
	Unaudited Consolidated Statements of Cash Flows for the ~~Three~~Nine Months Ended ~~May 31,~~November 30, 2020 and 2019	6
	Notes to Unaudited Consolidated Financial Statements	7
Item 2	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	3132
Item 3	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	4246
Item 4	CONTROLS AND PROCEDURES	4246

PART II	OTHER INFORMATION

Item 1	LEGAL PROCEEDINGS	4347
Item 1A	RISK FACTORS	4347
Item 2	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	4347
Item 6	EXHIBITS	4448
SIGNATURES		4549

	Number of Shares		Weighted Average Grant Date Fair Value		Number of Shares		Weighted Average Grant Date Fair Value
Unvested award balance at February 29, 2020		715,152	$	5.07		715,152	$	5.07
Granted		—		—		88,269		7.18
Vested		22,804		5.59		99,697		7.21
Vested and settled		100,000		4.15		100,000		4.15
Forfeited		—		—
Unvested award balance at May 31 2020		592,348	$	5.21
Unvested award balance at November 30, 2020						603,724	$	5.18

Automotive Electronics:	Amount			Amount
Beginning balance at March 1, 2020	$	8,467		$	8,467
Activity during the period		—			3,928
Balance at May 31, 2020	$	8,467
Gross carrying value at May 31, 2020	$	8,467
Balance at November 30, 2020				$	12,395
Gross carrying value at November 30, 2020				$	12,395
Accumulated impairment charge		—			0
Net carrying value at May 31, 2020	$	8,467
Net carrying value at November 30, 2020				$	12,395
Consumer Electronics:
Beginning balance at March 1, 2020	$	46,533		$	46,533
Activity during the period		—			0
Balance at May 31, 2020	$	46,533
Gross carrying value at May 31, 2020	$	78,696
Balance at November 30, 2020				$	46,533
Gross carrying value at November 30, 2020				$	78,696
Accumulated impairment charge		(32,163	)		(32,163	)
Net carrying value at May 31, 2020	$	46,533
Net carrying value at November 30, 2020				$	46,533
Total Goodwill, net	$	55,000		$	58,928

Year	Amount		Amount
2021			$	5,741
2022	$	4,878		4,933
2023		4,466		4,336
2024		3,620		4,115
2025		3,360		3,991
2026		3,200


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

Class		As of ~~July~~January 8, ~~2020~~2021
Class A Common Stock		~~21,656,976~~21,666,976 Shares
Class B Common Stock		2,260,954 Shares

	May 31, 2020		November 30, 2020
	Fair Value		Fair Value
Investment Securities
Marketable Equity Securities
Mutual funds	$	1,741	$	1,827
Total Marketable Equity Securities		1,741		1,827
Total Investment Securities	$	1,741	$	1,827

				Fair Value Measurements at Reporting Date Using								Fair Value Measurements at Reporting Date Using
	Total			Level 1		Level 2			Total			Level 1		Level 2
Cash and cash equivalents:
Cash and money market funds	$	69,039		$	69,039	$	—		$	21,337		$	21,337	$	0
Derivatives:
Designated for hedging	$	(606	)	$	—	$	(606	)	$	(1,026	)	$	0	$	(1,026	)
Investment securities:
Mutual funds	$	1,741		$	1,741	$	—		$	1,827		$	1,827	$	0
Total investment securities	$	1,741		$	1,741	$	—		$	1,827		$	1,827	$	0

	Derivative Assets and Liabilities							Derivative Assets and Liabilities
		Fair Value							Fair Value
	Account	May 31, 2020			February 29, 2020			Account	November 30, 2020			February 29, 2020
Designated derivative instruments
Foreign currency contracts	Prepaid expenses and other current assets	$	—		$	—		Prepaid expenses and other current assets	$	236		$	0
								Accrued expenses and other current liabilities		(710	)		0
Interest rate swap agreement	Other long-term liabilities		(606	)		(476	)	Other long-term liabilities		(552	)		(476	)
Total derivatives		$	(606	)	$	(476	)		$	(1,026	)	$	(476	)

	Foreign Currency Translation Losses			Pension plan adjustments, net of tax			Derivatives designated in a hedging relationship, net of tax			Total			Foreign Currency Translation Losses			Pension plan adjustments, net of tax			Derivatives designated in a hedging relationship, net of tax			Total
Balance at February 29, 2020	$	(17,739	)	$	(887	)	$	(429	)	$	(19,055	)	$	(17,739	)	$	(887	)	$	(429	)	$	(19,055	)
Other comprehensive income (loss) before reclassifications		504			(14	)		(177	)		313			3,608			(85	)		(609	)		2,914
Reclassified from accumulated other comprehensive loss		—			—			—			—			0			0			95			95
Net current-period other comprehensive income (loss)		504			(14	)		(177	)		313			3,608			(85	)		(514	)		3,009
Balance at May 31, 2020	$	(17,235	)	$	(901	)	$	(606	)	$	(18,742	)
Balance at November 30, 2020													$	(14,131	)	$	(972	)	$	(943	)	$	(16,046	)

	May 31, 2020		February 29, 2020
Raw materials	$	25,058	$	29,115
Work in process		2,224		2,366
Finished goods		78,127		67,629
Inventory	$	105,409	$	99,110

	May 31, 2020		February 29, 2020
Debt
Domestic credit facility (a)	$	20,000	$	—
Florida mortgage (b)		7,489		7,614
Euro asset-based lending obligation - VOXX Germany (c)		—		—
Euro asset-based lending obligation - Magnat (d)		617		607
Total debt		28,106		8,221
Less: current portion of long-term debt		1,116		1,107
Long-term debt		26,990		7,114
Less: debt issuance costs		810		1,015
Total long-term debt, net of debt issuance costs	$	26,180	$	6,099


Exhibit Number		Description

~~10.1~~		~~First Amendment to the Employment Agreement dated July 8, 2019, between the Company and Charles M. Stoehr (filed herewith).~~

~~10.2~~		~~First Amendment to the Employment Agreement dated July 8, 2019, between the Company and Loriann Shelton (filed herewith).~~

~~10.3~~		~~Employment Agreement, dated August 8, 2006, between Audio Products International Corp. and Oscar Bernardo (filed herewith).~~

~~10.4~~		~~First Amendment to the Employment Agreement dated August 8, 2006, between Audio Products International Corp. and Oscar Bernardo (filed herewith).~~

~~10.5~~		~~Second Amendment to the Employment Agreement dated August 8, 2006, between Audio Products International Corp. and Oscar Bernardo (filed herewith).~~

~~10.6~~		~~Third Amendment to the Employment Agreement dated August 8, 2006, between Audio Products International Corp. and Oscar Bernardo (filed herewith).~~

31.1		Certification of Patrick M. Lavelle Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934 (filed herewith).

31.2		Certification of Charles M. Stoehr Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934 (filed herewith).

32.1		Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).

32.2		Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).

101		The following materials from VOXX International Corporation's Quarterly Report on Form 10-Q for the period ended ~~May 31,~~November 30, 2020, formatted in Inline eXtensible Business Reporting Language ~~(XBRL)~~(iXBRL): (i) the Consolidated Balance Sheets, (ii), the Unaudited Consolidated Statements of Operations and Comprehensive Income (Loss) ~~Income,~~, (iii) the Unaudited Consolidated Statements of Stockholders’ Equity, (iv) the Unaudited Consolidated Statements of Cash Flows, and (v) Notes to the Unaudited Consolidated Financial Statements.

104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

VOXX INTERNATIONAL CORPORATION

~~July 10, 2020~~January 11, 2021

By:		/s/ Patrick M. Lavelle
Patrick M. Lavelle,
President and Chief Executive Officer

By:		/s/ Charles M. Stoehr
Charles M. Stoehr,
Senior Vice President and Chief Financial Officer