EXHIBIT 10.49




                        SANDS BROTHERS INTERNATIONAL LTD.
                               INVESTMENT BANKERS
                                   MEMBER NASD
                      90 PARK AVENUE, NEW YORK, N.Y. 10016
           (212) 697-5200 Toll Free (800) 866-6116 Fax (212) 697-8035



                                                                   July 11, 2003



Mr. Oded Bashan
On Track Innovations Ltd
ZHR, Industrial Zone
Rosh Pina, Israel 12000

Re: Financial Advisor Agreement

Dear Oded:

Sands  Brothers  International  (SBIL") is  pleased to act as the  non-exclusive
financial advisor for On Track  Innovations Ltd.  ("Company") in connection with
your proposed  capital  transaction.  The terms of our  engagement are set forth
below. We look forward to working with you.

     1.   The Offering.

          We  understand  you wish to raise up to $2.5 million  through a "PIPE"
          transaction   involving  the  sale  of  securities  to   institutional
          investors  (the  "Offering").  You  understand the actual terms of the
          Offering  will  depend on market  conditions,  and will be  subject to
          negotiation between the Company and prospective investors.

     2.   Fees and Expenses.

          (a)  Concurrently  with the closing of any part of the  Offering,  the
               Company  will  pay us in  cash a fee  equal  to 10% of the  gross
               proceeds  received  from the sale of  securities  on investors we
               introduce  to  you  and  5%  on  investors  who  invest   through
               intermediaries we introduce to you.

          (b)  In addition,  the Company agrees to reimburse us upon request for
               our expenses,  including the fees and  disbursements of our legal
               counsel of up to $8,000.

          (c)  Furthermore,  upon the closing of the offering, the Company shall
               grant to us warrants  for the  purchase of an amount equal to 10%
               of  the  securities  issued  in  the  offering  on  investors  we
               introduce  to  you  and  5%  on  investors  who  invest   through
               intermediaries  we  introduce  to you.  The  Warrants  shall  be:
               exercisable  into  securities  similar to those issued as part of
               the  offering;  have a strike price equal to 110% of the offering
               price; have a term of five years; and include a cashless issuance
               provision.


<PAGE>

     3.   Terms.

          (a)  The term of this agreement shall be three months; however, either
               party  may  terminate  this  agreement  at any time  upon 10 days
               written notice to the other party. Upon  termination,  we will be
               entitled to collect all fees earned and expenses incurred through
               the date of termination.

          (b)  If any part of the  offering is not closed  during the term,  for
               reasons  other  than  termination  of this  agreement  by us, and
               during the six months following termination of the agreement, any
               person  which  we  introduced,  directly  or  indirectly,  to the
               Company or with which we have discussions or negotiations  during
               the term of behalf of the Company,  purchases securities from the
               Company (other than through a underwritten public offering),  you
               agree to pay us upon the  closing a cash fee in the  amount  that
               would  otherwise  have been payable to SBIL had such  transaction
               occurred during the term.

     4.   Representations and Warranties.

          (a)  You  hereby   authorize  SBIL  to  transmit  to  the  prospective
               purchasers  of the  securities  material  prepared by the Company
               with  such  exhibits  and  supplements  as may from  time to time
               required  or  appropriate  and or  copies of the  Company's  most
               recent filings with Securities and Exchange Commission,  together
               with summary materials  prepared by the Company,  if we deem them
               appropriate (collectively "Material"). The Company represents and
               warrants that the Material (i) will be prepared by the management
               of  the  Company  and  reviewed  and  approved  by its  Board  of
               Directors;  and (ii) will not contain any untrue  statement  of a
               material  fact or omit to state a material  fact  required  to be
               stated  therein or  necessary to make the  statements  therein or
               previously made, in light of the  circumstances  under which they
               made, not misleading. The Company will advise SBIL immediately of
               the  occurrence  of any  event or any other  change  known to the
               Company  which  results  in the  Material  containing  an  untrue
               statement of a material fact or omitting to state a material fact
               required to be stated therein or necessary to make the statements
               therein or previously  made, in light of the  circumstance  under
               which they were made, not misleading.

          (b)  You agree  that you will enter  into  subscription,  registration
               rights and other customary agreements, and that your counsel will
               supply an opinion letter on the  transaction,  and comfort letter
               on the  non-financial  portions of the material and your auditors
               will supply a "comfort"  letter on the financial  information  in
               the  material,  all  of  which  will  be in  form  and  substance
               reasonably acceptable to, and addressed to the investors.

     5.   Indemnification, Contribution, and Confidentiality.

          The Company  agrees to  indemnify  SBIL and its  controlling  persons,
          representatives  and  agents in  accordance  with the  indemnification
          provisions  set  forth in  Schedule  A, and the  parties  agree to the
          confidentiality   provisions   of   Schedule   B,  all  of  which  are
          incorporated  herein by this  reference.  These  provisions will apply
          regardless of whether the proposed offering is consummated.


<PAGE>

     6.   Governing Law.

          This Agreement  shall be governed by and construed in accordance  with
          the laws of the state of New York applicable to contracts executed and
          to be wholly performed  therein without giving effect to its conflicts
          of laws  principles  or rules.  This  letter,  including  Schedule  A,
          constitutes  the entire  understanding  of the parties with respect to
          the subject  matter hereof and may not be altered or amended except in
          a writing signed by both parties.  This  Agreement  shall be deemed to
          have been made and delivered in New York City and shall be governed as
          to  validity,  interpretation,  construction,  effect and in all other
          respects by the  internal  laws of the State of New York.  The Company
          (l) agrees that any legal suit, action or proceeding arising out of or
          relating to this letter shall be  instituted  exclusively  in New York
          State  Supreme  Court,  County of New York,  or in the  United  States
          District  Court for the Southern  District of New York, (2) waives any
          objection  which the Company may have now or hereafter to the venue of
          any such suit, action or proceeding,  and (3) irrevocably  consents to
          the  jurisdiction  of the New York State Supreme Court,  County of New
          York, and the United States  District Court for the Southern  District
          of New  York in any such  suit,  action  or  proceeding.  The  Company
          further  agrees  to  accept  and  acknowledge  service  of any and all
          process which may be served in any such suit,  action or proceeding in
          the New York State Supreme Court, County of New York, or in the United
          States District Court for the Southern District of New York and agrees
          that service of process upon the Company  mailed by certified  mail to
          the  Company's  address  shall be  deemed in every  respect  effective
          service  of process  upon the  Company,  in any such  suit,  action or
          proceeding.  THE PARTIES HERETO AGREE TO WAIVE THEIR RESPECTIVE RIGHTS
          TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION  BASED UPON OR ARISING
          OUT OF  THIS  AGREEMENT  OR ANY  DOCUMENT  OR  AGREEMENT  CONTEMPLATED
          HEREBY.  Neither  the  execution  and  delivery  of this letter by the
          Company nor the consummation of the transactions  contemplated  hereby
          will, directly or indirectly,  with or without the giving of notice or
          lapse of time, or both: (i) violate any provisions of the  Certificate
          of Incorporation or By-laws of the Company;  or (ii) violate, or be in
          conflict  with, or constitute a default under,  any agreement,  lease,
          mortgage,  debt or  obligation  of the Company or require the payment,
          any pre-payment or other penalty with respect thereto.

     7.   Announcement of Offering.

          If the  Offering is  consummated,  SBIL may at its  expense,  place an
          announcement  in such  newspapers and  periodicals as SBIL may desire.
          OTI reserves the right to review and comment on any announcement  that
          SBIL  intends to publish with  respect to any  financing  contemplated
          here under that closes.

     8.   Advice to the Board.

          The Company  acknowledges that any advice given by us to you is solely
          for the benefit and use of the Board of  Directors  of the Company and
          may not be used,  reproduced,  disseminated,  quoted or  referred  to,
          without our prior written consent.


<PAGE>

     9.   Entire Agreement.

          This Agreement  constitutes the entire  Agreement  between the parties
          and  supersedes  and  cancels  any and all  prior  or  contemporaneous
          arrangements,  understandings and agreements,  written or oral between
          them relating to the subject matter hereof.


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<PAGE>

     We look forward to working with you and developing a long-term relationship
with the Company.



     Very Truly yours,


     Sands Brothers International, Ltd.


     By: /s/ Michael C. Caska
         Michael C. Caska
         President


     Confirmed and accepted as of This ___11th___ day of July, 2003.



     On Track Innovations Ltd.


     By: /s/ Oded Bashan
         Oded Bashan
         Chief Operating Officer






<PAGE>

                                   SCHEDULE A

                                 INDEMNIFICATION


         Recognizing  that matters of the type  contemplated  in this engagement
sometimes  result in  litigation  and that SBIL' role is  advisory,  the Company
agrees to indemnify and hold harmless Sands  Brothers,  its affiliates and their
respective  officers,  directors,  employees,  agents  and  controlling  persons
(collectively,  the "Indemnified Parties"), from and against any losses, claims,
damages and liabilities,  joint or several,  related to or arising in any manner
out of any transaction,  financing,  proposal or any other matter (collectively,
the  "Matters")  contemplated  by the  engagement  of SBIL  hereunder,  and will
promptly reimburse the Indemnified  Parties for all expenses (including fees and
expenses of legal counsel) as incurred in connection with the  investigation of,
preparation  for or defense of any  pending or  threatened  claim  related to or
arising in any manner out of any Matter  contemplated  by the engagement of SBIL
hereunder,  or  any  action  or  proceeding  arising  therefrom   (collectively,
"Proceedings"),  whether or not such Indemnified  Party is a formal party to any
such Proceeding.  Notwithstanding the foregoing, the Company shall not be liable
in respect of any losses, claims, damages,  liabilities or expenses that a court
of competent  jurisdiction  shall have  determined  by final  judgment  resulted
solely from the gross negligence or willful  misconduct of an Indemnified Party.
The Company  further agrees that it will not,  without the prior written consent
of Sands Brothers, settle, compromise or consent to the entry of any judgment in
any pending or threatened  Proceeding in respect of which indemnification may be
sought hereunder  (whether or not SBIL or any Indemnified  Party is an actual or
potential  party to such  Proceeding),  unless such  settlement,  compromise  or
consent  includes an  unconditional  release of SBIL and each other  Indemnified
Party hereunder from all liability arising out of such Proceeding.

         The Company agrees that if any indemnification or reimbursement  sought
pursuant  to  this  letter  were  for  any  reason  not to be  available  to any
Indemnified  Party or  insufficient  to hold it  harmless  as and to the  extent
contemplated  by this letter,  then the Company  shall  contribute to the amount
paid or payable by such Indemnified Party in respect of losses,  claims, damages
and  liabilities  in such  proportion as is  appropriate to reflect the relative
benefits to the Company and its  stockholders  on the one hand,  and SBIL on the
other,  in  connection  with  the  Matters  to  which  such  indemnification  or
reimbursement relates or, if such allocation is not permitted by applicable law,
not only such relative  benefits but also the relative faults of such parties as
well as any  other  equitable  considerations.  It is  hereby  agreed  that  the
relative  benefits  to the  Company  and/or  its  stockholders  and to SBIL with
respect to SBIL'  engagement shall be deemed to be in the same proportion as (i)
the total value paid or received or to be paid or received by the Company and/or
its stockholders  pursuant to the Matters (whether or not consummated) for which
SBIL is engaged to render  financial  advisory  services  bears to (ii) the fees
paid  to SBIL  in  connection  with  such  engagement.  In no  event  shall  the
Indemnified Parties contribute or otherwise be liable for an amount in excess of
the  aggregate  amount  of  fees  actually  received  by SBIL  pursuant  to such
engagement (excluding amounts received by SBIL as reimbursement of expenses).


<PAGE>

         The Company  further  agrees that no  Indemnified  Party shall have any
liability (whether direct of indirect,  in contract or tort or otherwise) to the
Company for or in connection with SBIL' engagement  hereunder except for losses,
claims, damages,  liabilities or expenses that a court of competent jurisdiction
shall  have  determined  by  final  judgment  resulted  solely  from  the  gross
negligence  or willful  misconduct of such  Indemnified  Party.  The  indemnity,
reimbursement  and contribution  obligations of the Company shall be in addition
to any liability  which the Company may otherwise have and shall be binding upon
and  inure  to the  benefit  of any  successors,  assigns,  heirs  and  personal
representatives of the Company or an Indemnified Party.

         The indemnity, reimbursement,  contribution provisions set forth herein
shall  remain  operative  and in full  force and  effect  regardless  of (i) any
withdrawal,  termination or consummation of or failure to initiate or consummate
any Matter referred to herein,  (ii) any  investigation  made by or on behalf of
any party hereto or any person controlling  (within the meaning of Section 15 of
the Securities Act of 1933, as amended, or Section 20 of the Securities Exchange
Act of 1934,  as  amended)  any  party  hereto,  (iii)  any  termination  or the
completion or expiration of this letter or SBIL'  engagement and (iv) whether or
not SBIL  shall,  or shall not,  be called upon to render any formal or informal
advice in the course of such engagement.











<PAGE>

                                   SCHEDULE B


                   INFORMATION TO BE SUPPLIED; CONFIDENTIALITY

         In  connection  with SBIL's  activities  on behalf of the Company,  the
Company will furnish SBIL with all financial and other information regarding the
Company that SBIL  reasonably  believes  appropriate to its assignment (all such
information so furnished by the Company,  whether  furnished before or after the
date of this  Agreement,  being  referred to herein as the  "Information").  The
Company  will provide SBIL with access to the  officers,  directors,  employees,
independent accountants, legal counsel and other advisors and consultants of the
Company.  The  Company  recognizes  and  agrees  that SBIL (i) will use and rely
primarily on the Information and information available from generally recognized
public sources in performing the services contemplated by this Agreement without
independently verifying the Information or such other information, (ii) does not
assume  responsibility  for the accuracy of the Information or such information,
and (iii)  will not make an  appraisal  of any  assets or  liabilities  owned or
controlled by the Company or its market competitors.

         SBIL will maintain the  confidentiality  of the Information and, unless
and until  such  information  shall  have been made  publicly  available  by the
Company  or by others  without  breach  of a  confidentiality  agreement,  shall
disclose the information only as authorized by the Company or as required by law
or by order of a governmental authority or court of competent  jurisdiction.  In
the  event  that  SBIL is  legally  required  to make  disclosure  of any of the
Information,  SBIL will give notice to the Company prior to such disclosure,  to
the extent that SBIL can practically do so.

The foregoing paragraph shall not apply to information that:

                  (i)      at the  time of  disclosure  by the  Company  is,  or
                           thereafter becomes, generally available to the public
                           or within the industries in which the Company or SBIL
                           or its affiliates  conduct business,  other than as a
                           direct result of a breach by SBIL of its  obligations
                           under this Agreement;

                  (ii)     prior to or at the time of disclosure by the Company,
                           was already it in the  possession  of, or,  conceived
                           by, SBIL or any of its affiliates, or could have been
                           developed  by them  from  information  then in  their
                           possession,  by the application of other  information
                           or   techniques   in  their   possession,   generally
                           available to the public,  or available to SBIL or its
                           affiliates other than from the Company;

                  (iii)    at  the  time  of   disclosure   by  the  Company  or
                           thereafter,  is  obtained  by  SBIL  or  any  of  its
                           affiliates  from a third  party  who SBIL  reasonably
                           believes to be in possession of the  information  not
                           in violation of any  contractual,  legal or fiduciary
                           obligation  to  the  Company  with  respect  to  that
                           information; or


<PAGE>

                  (iv)     is independently developed by SBIL or its affiliates.


         Nothing in this  Agreement  shall be  construed to limit the ability of
SBIL or its affiliates to pursue, investigate,  analyze, invest in, or engage in
investment banking,  financial advisory or any other business  relationship with
entities  other than the  Company,  notwithstanding  that such  entities  may be
engaged in a business  which is similar to or  competitive  with the business of
the Company, and notwithstanding that such entities may have actual or potential
operations,  products,  services, plans, ideas, customers or supplies similar or
identical  to the  Company's,  or may have been  identified  by the  Company  as
potential merger or acquisition  targets or potential  candidates for some other
business  combination,   cooperation  or  relationship.  The  Company  expressly
acknowledges  and agrees that it does not claim any proprietary  interest in the
identity of any other entity in its industry or otherwise, and that the identity
of any such entity is not confidential information.