Three members of the Elbit Vision Systems (Nasdaq:EVSN) board of directors quit after spatting with the chairman and acting CEO, Nir Alon, about the company's funding arrangements.

Two of the three are independent directors Gad Propper and Prof. Amotz Weinberg. The third was Ida Keidar, who has served a director since 1993.

In accordance with Israeli corporate law, the company will promptly call a shareholders meeting to fill the vacancies on its board, it said.

The mass resignation comes three months after Ofer Yuval announced his resignation as the company's president and CEO. Nir Alon has served as acting CEO since June 1.

Elbit Vision designs, makes and supports automatic optical inspection and quality monitoring systems for the textile and the non-woven industries.

The company reported revenue of $1.9 million for the first quarter, down 4% from the corresponding quarter of 2001.

For the first quarter it reported losing $287,000, compared with losing $643,000 in the parallel. The company's stock is traded on the Nasdaq smallcap market, according to a market value of $2.6 million.