Summary
Fortinet, Inc. (FTNT) filed an 8-K on August 28, 2015, to report a notice of failure to satisfy a continued listing rule due to a director's resignation. Hong Liang Lu resigned from the Board of Directors, the Audit Committee, and the Nominating and Corporate Governance Committee, effective August 24, 2015. His resignation was attributed to focusing on other matters and not to any disagreements with the company. This resignation has caused the company to fall out of compliance with NASDAQ Listing Rule 5605(c)(2)(A), which requires an Audit Committee to have at least three members. Following Mr. Lu's departure, the Audit Committee was reduced to two members. Fortinet has been granted a cure period until the earlier of its next annual meeting or August 24, 2016, to regain compliance by appointing a new independent director. The company has notified NASDAQ of the non-compliance and its reliance on the cure period, and stated its intention to fill the vacancy promptly.
Key Highlights
- 1Director Hong Liang Lu resigned from Fortinet's Board, Audit Committee, and Governance Committee.
- 2The resignation is effective August 24, 2015.
- 3Mr. Lu's resignation was voluntary and not due to any disagreements with the company.
- 4Fortinet is currently not in compliance with NASDAQ Listing Rule 5605(c)(2)(A) requiring at least three members on the Audit Committee.
- 5The company has a cure period until the earlier of its next annual meeting or August 24, 2016, to regain compliance.
- 6Fortinet intends to appoint a new independent director to the Audit Committee to fill the vacancy as soon as practicable.