Sec Form 13D Filing - GROSS LEON S filing for AROTECH CORP (ARTX) - 2003-10-07

Insider filing report for Changes in Beneficial Ownership

  • Schedule 13G & 13D forms are used to report a party's ownership of stock which exceeds 5% of a company's total stock issue.
  • Schedule 13G is a shorter version of Schedule 13D with fewer reporting requirements.
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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  Schedule 13D

                    Under the Securities Exchange Act of 1934
                               (Amendment No. 18)*

                               Arotech Corporation
- --------------------------------------------------------------------------------
                                (Name of Issuer)

                          Common Stock $0.01 Par Value
- --------------------------------------------------------------------------------
                         (Title of Class of Securities)

                                   042682-10-4
- --------------------------------------------------------------------------------
                                 (CUSIP Number)

                Steven M. Plon, Esquire, Plon & Associates, P.C.
     1835 Market Street, Suite 1215, Philadelphia, PA 19103, (215) 979-7603
- --------------------------------------------------------------------------------
                  (Name, Address and Telephone Number of Person
                Authorized to Receive Notices and Communications)

                                 October 3, 2003
- --------------------------------------------------------------------------------
                      (Date of Event which Requires Filing
                               of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of ss.ss.240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the
following box |_|.

Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See ss.240.13d-7 for other
parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).

                         (Continued on following pages)




CUSIP No.  284871-10-0                                               Page 2 of 9

         1. Names of Reporting Persons. I.R.S. Identification Nos. of
above persons (entities only)...... Leon S. Gross

         2. Check the Appropriate Box if a Member of a Group (See Instructions)
                  (a)
.................................................................................
                  (b)
.................................................................................

         3. SEC Use Only
.................................................................................

         4. Source of Funds (See Instructions)
.................................................................................

         5. Check if Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) .................

         6. Citizenship or Place of Organization .....United States of America

Number of Shares Beneficially Owned by
Each Reporting Person With

         7. Sole Voting Power....... 3,072,869 [includes 35,000 options to
            purchase common stock]

         8. Shared Voting Power ....... 450,665 are held jointly as a Co-Trustee
            of the Rose Gross Charitable Foundation

         9. Sole Dispositive Power .........3,072,869 [includes 35,000 options
            to purchase common stock]

        10. Shared Dispositive Power ........ 450,665 are held jointly as a
            Co-Trustee of the Rose Gross Charitable Foundation

        11. Aggregate Amount Beneficially Owned by Each Reporting Person........
3,523,534 [includes 35,000 options to purchase common stock].

        12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions) ...........

        13. Percent of Class Represented by Amount in Row (11)...8.8% of
the issued and outstanding stock (1)

        14. Type of Reporting Person (See Instructions)
................................Individual.......................................

(1) Based upon 40,078,032 shares of common stock outstanding as reported in the
Issuer's Proxy dated August 6, 2003, and assuming exercise of options to
purchase 35,000 Shares held by Mr. Gross.



                                                                     Page 3 of 9

                        AMENDMENT NO. 18 TO SCHEDULE 13D

         This Amendment No. 18 to the Schedule 13D originally dated February 23,
1996, as amended by the First Amendment to Schedule 13D dated April 30, 1996,
the Second Amendment to Schedule 13D dated September 1, 1996, the Third
Amendment to Schedule 13D dated October 11, 1996, the Fourth Amendment to
Schedule 13D dated December 27, 1996, the Fifth Amendment to Schedule 13D dated
May 12, 1997, the Sixth Amendment to Schedule D dated December 3, 1997, the
Seventh Amendment to Schedule 13D dated September 28, 1998, the Eighth Amendment
to Schedule 13D dated October 14, 1999, the Ninth Amendment to Schedule 13D
dated October 28, 1999, the Tenth Amendment to Schedule 13D dated January 12,
2000, the Eleventh Amendment to Schedule 13D dated June 26, 2000, the Twelfth
Amendment to Schedule 13D dated October 20, 2000, the Thirteenth Amendment to
Schedule 13D dated January 16, 2001, the Fourteenth Amendment to Schedule 13D
dated April 3, 2001, the Fifteenth Amendment to Schedule 13D dated January 14,
2002, the Sixteenth Amendment to Schedule 13D dated August 14, 2003, and the
Seventeenth Amendment to Schedule 13D dated September 10, 2003 (the "Existing
Schedule 13D"), is being filed by the undersigned in accordance with Rule
13d-2(a) of the general rules and regulations under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), and amends the Existing Schedule 13D
to the extent set forth below. Terms defined in the Existing Schedule 13D are
used herein as so defined.


Item 6.  Contracts, Arrangements, Understanding or Relationship with Respect
         to Securities of the Issuer.
         --------------------------------------------------------------------

Item 6 of the Existing Schedule 13D is hereby amended by adding the following
paragraph:

         Pursuant to the terms of a Securities Purchase Agreement dated
September 30, 2003 (the "Purchase Agreement") by and between the Issuer and six
institutional investors (the "Investors"), the Issuer issued and sold to the
Investors certain Debentures and Warrants and agreed to sell certain additional
Debentures and Warrants. In connection with the Purchase Agreement, Mr. Gross
has entered into a Voting Agreement dated as of September 30, 2003 among the
Investors and the Company (the "Voting Agreement") pursuant to which he has
agreed to vote in favor of the issuance of said debentures and warrants in the
event the issue is brought to a vote at a shareholders meeting held on or before
December 31, 2004. A copy of the Voting Agreement is attached hereto as Exhibit
1.

Item 7.  Material to Filed as Exhibits.
         ------------------------------

Exhibit 1 - Voting Agreement

                                   SIGNATURE

         After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.

October 7, 2003
- ------------------------------
Date

/s/ Leon S. Gross
- ------------------------------
Leon S. Gross



                                                                     Page 4 of 9


                                    Exhibit 1
                                    ---------

                                VOTING AGREEMENT

                  VOTING AGREEMENT, dated as of September 30, 2003 (this
"Agreement"), by the shareholder of Arotech Corporation, a Delaware corporation
(f/k/a Electric Fuel Corporation, the "Company") listed on the signature pages
hereto under the heading "Shareholder" (the "Shareholder"), the Company and the
investors listed on the signature pages hereto under the heading "Investors")
(each, an "Investor" and collectively, the "Investors").

                  WHEREAS, the Investors and the Company have entered into a (i)
Securities Purchase Agreement, dated as of the date hereof (the "Securities
Purchase Agreement"), pursuant to which, among other things, the Company has
agreed to issue and sell to the Investors and the Investors have agreed to
purchase, an aggregate of up to $11 million of 8% secured convertible debentures
of the Company (together with any debentures issued in replacement or exchange
thereof in accordance with the terms thereof, the "Debentures"), which
Debentures shall be convertible into shares of Common Stock, par value $0.01 per
share, of the Company (the "Common Shares"), in accordance with the terms of the
Debentures;

                  WHEREAS, as of the date hereof, the Shareholder owns 3,037,869
Common Shares and is co-trustee of the Rose Gross Charitable Foundation (the
"Foundation") which owns 450,665 Common Shares, which represent in the aggregate
8.8% of the total issued and outstanding capital stock of the Company; and

                  WHEREAS, as a condition to the willingness of the Investors to
enter into the Securities Purchase Agreement and to consummate the transactions
contemplated thereby (collectively, the "Transaction"), the Investors have
required that the Shareholder agree, and in order to induce the Investors to
enter into the Securities Purchase Agreement, the Shareholder has agreed, to
enter into this Agreement with respect to all the Common Shares now owned and
which may hereafter be acquired by the Shareholders (the "Shares") and any other
securities, if any, which the Shareholder is entitled to vote at any meeting of
shareholders of the Company (the "Other Securities").

                  NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and agreements contained herein, and intending to be legally
bound hereby, the parties hereto hereby agree as follows:


                                    ARTICLE I

                            PROXY OF THE STOCKHOLDERS
                            -------------------------

                  SECTION 1.01. Voting Agreement. The Shareholder hereby agrees
that at any meeting of the stockholders of the Company, however called, and in
any action by consent of the Company, of the shareholders shall vote the Shares
and the Other Securities (to the extent the Shareholder has the right to vote
such Other Securities) in favor of any matters relating to the Transaction,
including, without limitation the matters described in Section 4.11 of the
Securities Purchase Agreement. The obligations of the Shareholder under this
Section 1.01 shall terminate on the later to occur of (i) the occurrence and
tabulation of votes at the shareholder meeting of the Company contemplated by
Section 4.11 of the Securities Purchase Agreement and (ii) the date that is
December 31, 2004.


                                                                     Page 5 of 9


                                   ARTICLE II

               REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS
               --------------------------------------------------

                  The Shareholder hereby represents and warrants to the
Investors as follows:

                  SECTION 2.01. Authority Relative to This Agreement. Each
Shareholder has all necessary power and authority to execute and deliver this
Agreement, to perform his or its obligations hereunder and to consummate the
transactions contemplated hereby. This Agreement has been duly executed and
delivered by such Shareholder and constitutes a legal, valid and binding
obligation of such Shareholder, enforceable against such Shareholder in
accordance with its terms.

                  SECTION 2.02. No Conflict. (a) The execution and delivery of
this Agreement by such Shareholder do not, and the performance of this Agreement
by such Shareholder shall not, (i) conflict with or violate any federal, state
or local law, statute, ordinance, rule, regulation, order, judgment or decree
applicable to such Shareholder or by which the Shares or the Other Securities
owned by such Shareholder are bound or affected or (ii) result in any breach of
or constitute a default (or an event that with notice or lapse of time or both
would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, or result in the creation of a lien
or encumbrance on any of the Shares or the Other Securities owned by such
Shareholder pursuant to, any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument or obligation
to which such Shareholder is a party or by which such Shareholder or the Shares
or Other Securities owned by such Shareholder are bound or affected.

                  (b) The execution and delivery of this Agreement by such
Shareholder do not, and the performance of this Agreement by such Shareholder
shall not, require any consent, approval, authorization or permit of, or filing
with or notification to, any governmental entity except for filings by the
Shareholder with the Securities and Exchange Commission (which shall include an
amendment to the Shareholder's 13D filing, including attached a copy of this
Agreement as an exhibit thereto).

                  SECTION 2.03. Title to the Shares. As of the date hereof, each
Shareholder is the beneficial owner of the number of Common Shares set forth
opposite such Shareholder's name on Appendix A hereto entitled to vote, without
restriction, on all matters brought before holders of capital stock, which
Shares represent on the date hereof the percentage of the outstanding Common
Shares set forth on such Appendix. Such Shares are all the securities of the
Company owned, either of record or beneficially, by such Shareholder other than
stock options for the purchase of up to 35,000 Common Shares of the Company.
Such Shares are owned free and clear of all security interests, liens, claims,
pledges, options, rights of first refusal, agreements, limitations on such
Shareholder's voting rights, charges and other encumbrances of any nature
whatsoever other than the Voting Agreement, dated September 30, 1996 (the
"Shareholder Voting Agreement"), as amended among the Shareholder, Robert
Ehrlich and Yehuda Harats and, with respect to the Shares held by the
Foundation, the Shareholder is only the co-trustee of the Foundation and the
Shares would be subject to any applicable restrictions contained in the
indenture of trust creating the Foundation. No Shareholder has appointed or
granted any proxy, which appointment or grant is still effective, with respect
to the Shares or Other Securities owned by such Shareholder except as may be
provided in the Shareholder Voting Agreement.

                                                                     Page 6 of 9


                                   ARTICLE III

                                    COVENANTS
                                    ---------

                  SECTION 3.01. Company Cooperation. The Company agrees to use
its best efforts to ensure that at any time in which any shareholder approval is
required pursuant to Section 4.11 of the Securities Purchase Agreement, it will
cause holders of Common Shares or Other Securities representing the percentage
of outstanding capital stock required to vote in favor of the Transaction in
order for the Company to comply with its obligations under Section 4.11 of the
Securities Purchase Agreement to become party to and bound by the terms and
conditions of this Agreement and the Common Shares of the Company and Other
Securities held by such holders to be subject to the terms and conditions of
this Agreement.

                
                   ARTICLE IV

                                  MISCELLANEOUS
                                  -------------

                  SECTION 4.01. Further Assurances. Each Shareholder will
execute and deliver all such further documents and instruments and take all such
further action as may be necessary in order to consummate the transactions
contemplated hereby.

                  SECTION 4.02. Specific Performance. The parties hereto agree
that irreparable damage would occur in the event any provision of this Agreement
was not performed in accordance with the terms hereof and that any Investor
(without being joined by any other Investor) shall be entitled to specific
performance of the terms hereof, in addition to any other remedy at law or in
equity.

                  SECTION 4.03. Entire Agreement. This Agreement constitutes the
entire agreement between the Investors, the Shareholders and the Company (other
than the Securities Purchase Agreement) with respect to the subject matter
hereof and supersedes all prior agreements and understandings, both written and
oral, among the Investors, the Shareholders and the Company with respect to the
subject matter hereof.

                  SECTION 4.04. Amendment. This Agreement may not be amended
except by an instrument in writing signed by the parties hereto.

                  SECTION 4.05. Severability. If any term or other provision of
this Agreement is invalid, illegal or incapable of being enforced by any rule of
law, or public policy, all other conditions and provisions of this Agreement
shall nevertheless remain in full force and effect so long as the economic or
legal substance of this Agreement is not affected in any manner materially
adverse to any party. Upon such determination that any term or other provision
is invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in a mutually acceptable manner in
order that the terms of this Agreement remain as originally contemplated to the
fullest extent possible.

                                                                     Page 7 of 9


                  SECTION 4.06. Jurisdiction. The parties hereby agree that all
actions or proceedings arising directly or indirectly from or in connection with
this Agreement shall be litigated only in the state and federal courts located
in Philadelphia, Pennsylvania. The parties consent to the jurisdiction and venue
of the foregoing courts and consent that any process or notice of motion or
other application to either of said courts or a judge thereof may be served
inside or outside the State of Pennsylvania by registered mail, return receipt
requested, directed to the party being served at its address set forth in this
Agreement (and service so made shall be deemed complete three (3) days after the
same has been posted as aforesaid) or by personal service or in such other
manner as may be permissible under the rules of said courts. Each of the Company
and the Shareholder irrevocably waive, to the fullest extent permitted by law,
any objection which it may now or hereafter have to the laying of the venue of
any such suit, action, or proceeding brought in such a court and any claim that
suit, action, or proceeding has been brought in an inconvenient forum. Each of
the Company and the Shareholder hereby waive any right to a jury trial in
connection with any litigation pursuant to this Agreement.

                  SECTION 4.07 Notice. A copy of all notices to the Shareholder
shall be sent to the Shareholder's counsel at the following address:

                  Steven M. Plon, Esquire
                  Plon & Associates, P.C.
                  1835 Market Street, Suite 1215
                  Philadelphia, PA 19103
                  Fax No. 215-979-7619
                  Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

                  SECTION 4.08. Successors/Transferees. This Agreement shall be
binding upon the parties' respective successors, heirs, personal representatives
and assigns; provided, however, that this Agreement shall not be binding upon
any purchasers of Shareholder's Shares or Other Securities who purchased the
Shareholder's Shares or Other Securities in a bona-fide arms-length transaction,
which may include such a private or public sale of such Shares or Other
Securities.


                                                                     Page 8 of 9

                  IN WITNESS WHEREOF, the Shareholder and the Company has duly
executed this Agreement.

                                         THE COMPANY:

                                         AEROTECH CORPORATION

                                         By:  ___________________________
                                              Name:
                                              Title:
Dated: September __, 2003



                                        SHAREHOLDER:


Dated: September 30, 2003               ___________________________
                                        Leon S. Gross


Agreed and Accepted
as of: September __, 2003

INVESTORS:

SMITHFIELD FIDUCIARY LLC


By:__________________________________
      Name:
      Title:

OMICRON MASTER TRUST


By:__________________________________
      Name:
      Title:

PORTSIDE GROWTH AND OPPORTUNITY FUND


By:__________________________________
      Name:
      Title:

MAINFIELD ENTERPRISES INC.


By:__________________________________
      Name:
      Title:

CRANSHIRE CAPITAL L.P.


By:__________________________________
      Name:
      Title:

CLEVELAND OVERSEAS LTD.


By:__________________________________
      Name:
      Title:



                                                                     Page 9 of 9


                                   APPENDIX A
                                   ----------



                                                                          Total Percentage of
 Shareholder                    Shares              Other Securities       Shares Outstanding
 -----------                    ------              ----------------       -------------------
                                                                        

 Leon S. Gross, as co trustee   450,665
 of the Rose Gross Charitable
 Foundation


 Leon S. Gross                  3,037,869


 TOTAL                          3,488,534                                  8.8% (in the
                                                                           aggregate, including
                                                                           Foundation's shares)