Elbit Systems announced today that, as anticipated, it has received a notice of deficiency (the "Notice") from The Nasdaq Stock Market LLC ("Nasdaq") notifying the Company that it is not in compliance with Nasdaq Listing Rule 5605(b)(1) which requires that a majority of the board of directors of a listed company be persons who qualify as “independent directors” under Nasdaq’s Listing Rules. As a result of the June 17, 2020 resignation by Mr. Moshe Kaplinsky, who was an independent director, the Company’s board of directors consists of an equal number of independent and non-independent directors.
On June 17, 2020, the Company announced (i) Mr. Kaplinsky’s resignation, (ii) the Company’s notice to Nasdaq that the Company would be temporarily out of compliance with the independent directors majority requirement and (iii) the Company’s intent to promptly proceed with the process of identifying a suitable candidate for election as a director and convening a shareholders meeting for his or her election, within the period contemplated by Nasdaq’s Listing Rules.
The Notice does not impact the Company's listing on the Nasdaq Global Select Market at this time, provided that the Company cures the deficiency under Nasdaq Listing Rule 5605(b)(1) within the time period specified by the applicable Nasdaq Listing Rule. For this purpose, Nasdaq Listing Rule 5810(c)(3)(C)(E) requires the Company to cure the deficiency by the earlier of its next annual shareholders meeting or one year from the event that caused the deficiency (the “Event”); however, if the Company's next annual shareholders' meeting is held sooner than 180 days after the Event, then the Company has 180 days from the Event to cure it.
The Company is also listed on the Tel Aviv Stock Exchange and the Notice does not affect the Company's status with such listing.