EXHIBIT 10.39



                            ON TRACK INNOVATIONS LTD.

                             Subscription Agreement


THE ORDINARY SHARES COVERED HEREBY HAVE NOT BEEN REGISTERED, QUALIFIED, APPROVED
OR DISAPPROVED  UNDER ANY FEDERAL OR STATE  SECURITIES  LAWS, NOR HAS THE UNITED
STATES  SECURITIES  AND  EXCHANGE  COMMISSION  OR ANY  OTHER  FEDERAL  OR  STATE
REGULATORY  AUTHORITY  PASSED ON OR ENDORSED  THE MERITS OF THE  OFFERING OF THE
ORDINARY SHARES.  ANY  REPRESENTATION TO THE CONTRARY IS UNLAWFUL.  THE ORDINARY
SHARES MAY NOT BE SOLD,  TRANSFERRED,  OR  OTHERWISE  DISPOSED OF BY AN INVESTOR
UNLESS THE ORDINARY  SHARES HAVE BEEN REGISTERED  UNDER FEDERAL  SECURITIES LAWS
AND,  WHERE  REQUIRED,  UNDER THE LAWS OF OTHER  JURISDICTIONS,  OR  UNLESS  THE
PROPOSED SALE, TRANSFER OR DISPOSITION IS EXEMPT FROM REGISTRATION. ACCORDINGLY,
A PURCHASER OF THE ORDINARY SHARES MUST BE PREPARED TO BEAR THE ECONOMIC RISK OF
THE INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.


                                                     Dated as of  June 27, 2003



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Gentlemen:

         The  undersigned  (the  "Subscriber")  is executing and delivering this
Agreement in  connection  with the  subscription  by the  undersigned  for Fifty
thousand  (50,000)  ordinary  shares,  NIS  0.1  nominal  value  (the  "Ordinary
Shares"),  of On Track  Innovations Ltd., (the  "Corporation").  The undersigned
understands  that the Corporation is relying upon the accuracy and  completeness
of the  information  contained  herein in complying with its  obligations  under
federal and state  securities  laws and in considering  whether or not to accept
the subscription of the undersigned.

         The  undersigned  hereby  irrevocably  agrees,  represents and warrants
with, to and for the benefit of the Corporation as follows:

         1. Subscription.

         (a)  Subject  to the  terms  and  conditions  of  this  Agreement,  the
undersigned  hereby  subscribes  for the Ordinary  Shares and agrees to become a
Subscriber  for the amount set forth herein  immediately  above the signature of
the undersigned.

         (b) The  undersigned  tenders  herewith  a check  payable  to On  Track
Innovations Ltd. in the full amount of the subscription price of the undersigned
pursuant to Section 1(a).

         (c) The  undersigned  is  delivering  herewith (i) two signed copies of
this   Agreement   and  (ii)  a  signed  and  completed   Investor   Suitability
Questionnaire, in the form accompanying this Agreement.

         2.  Acceptance.   The  undersigned  understands  and  agrees  that  the
Corporation has full right to accept or reject this subscription, in whole or in
part.  Upon acceptance of a subscription  by the  Corporation,  one copy of this
Agreement,  signed  by the  undersigned  and,  to  indicate  acceptance,  by the
Corporation, shall be returned to the undersigned by the Corporation.

         3. Representations and Warranties.

         (a)  Set  forth  below  is  the  true  and   correct   address  of  the
undersigned's residence or principal place of business. The only jurisdiction in
which an offer to sell the Ordinary  Shares was made to the  undersigned  is the
jurisdiction in which such residence or principal place of business is situated.
The  undersigned  has no present  intention of becoming a resident of (or moving
its principal place of business to) any other state or jurisdiction.

         (b) The undersigned  understands that the Ordinary Shares have not been
registered  under the  Securities  Act of 1933, as amended (the "1933 Act"),  or
under the laws of any other jurisdiction. The undersigned understands and agrees
that the Ordinary Shares must be held indefinitely  unless they are subsequently
registered  under  the 1933 Act and,  where  required,  under  the laws of other
jurisdictions or unless an exemption from registration is available.

         (c) The Ordinary Shares for which the undersigned hereby subscribes are
being acquired solely for the  undersigned's  own account for investment and are
not  being  purchased  with  a view  to or for  resale,  distribution  or  other
disposition,  and the  undersigned  has no  present  plans  to  enter  into  any
contract,   undertaking,   agreement  or   arrangement   for  any  such  resale,
distribution or other disposition.

         (d) The  undersigned  understands,  acknowledges,  agrees  and is aware
that:

                   (i) no federal or state agency has passed upon the Ordinary
         Shares or made any finding or determination as to the fairness of this
         investment;

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                  (ii) the Ordinary Shares are speculative investments which
         involve a high degree of risk, including the risk that the undersigned
         might lose its entire investment in the Corporation; and

                  (iii) any federal income tax benefits which may be available
         to the undersigned may be lost through adoption of new laws, amendments
         to existing laws or regulations, or changes in the interpretation of
         existing laws and regulations.

         (e) The undersigned has carefully reviewed and understands the risks of
a purchase of the Ordinary Shares.

         (f) In connection with the undersigned's investment in the Corporation,
the  undersigned  has obtained the advice of the  undersigned's  own  investment
advisors, counsel and accountants ("advisors").

         (g) The undersigned and the undersigned's  advisors have been furnished
all materials  relating to the  Corporation  or the offering of Ordinary  Shares
(the  "Offering")  which the  undersigned  and the  undersigned's  advisors have
requested. The undersigned and the undersigned's advisors have been afforded the
opportunity  to ask  questions  of the  Corporation  concerning  the  terms  and
conditions of the Offering and to obtain any additional information necessary to
verify the accuracy of any  representations  or information  set forth about the
Ordinary Shares.

         (h) The Corporation has answered all inquiries that the undersigned and
the  undersigned's  advisors have made  concerning the  Corporation or any other
matters relating to the creation and operations of the Corporation and the terms
and conditions of the Offering.

         (i) At no time was the  undersigned  presented with or solicited by any
leaflet,  public promotional  meeting,  newspaper or magazine article,  radio or
television  advertisement  or any other form of general  advertising  or general
solicitation.

         (j) The undersigned has the financial ability to bear the economic risk
of the  undersigned's  investment in the  Corporation and has adequate net worth
and means of providing for the undersigned's  current needs and contingencies to
sustain a  complete  loss of the  undersigned's  investment  and has no need for
liquidity in the undersigned's investment in the Corporation.

         (k) The  undersigned has such knowledge and experience in financial and
business  matters  that  the  undersigned  is  capable  of  evaluating,  and has
evaluated, the merits and risks of the proposed investment.

         (l) The  undersigned  represents and warrants that it is an "accredited
investor,"  as that term is defined in Rule 501 of  Regulation  D under the 1933
Act.

         (m)  The  information  provided  by the  undersigned  in  the  Investor
Suitability  Questionnaire and the other Subscription documents delivered by the
undersigned to the Corporation  herewith is incorporated herein by reference and
made a part  hereof,  and the  undersigned  represents  and  warrants  that such
information  is true and  complete  and fairly  reflects  the current  financial
condition and affairs of the undersigned.

         (n) If the  undersigned is a corporation,  partnership,  trust or other
entity,  (i) it is  authorized  and  qualified  and has full  right and power to
become a Subscriber  in, and is  authorized to purchase  Ordinary  Shares and to
perform its  obligations  pursuant  to the  provisions  hereof,  (ii) the person
signing this Subscription Agreement,  the other Subscription Documents,  and any
other  instrument  executed and delivered  herewith on behalf of such entity has
been duly  authorized  by such entity and has full power and authority to do so,
and (iii) such entity has not been formed for the specific  purpose of acquiring
an  interest  in the  Corporation,  unless  each  owner  of  such  entity  is an
accredited  investor  under  Regulation  D of the SEC under the 1933 Act and has
submitted information substantiating such qualification.

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         (o) The undersigned  hereby  represents and warrants to the Corporation
that by  reason  of the  undersigned's  business  or  financial  experience  the
undersigned  has  the  capacity  to  protect  the  undersigned's   interests  in
connection with an investment in the Corporation.

         (p) If the undersigned is a Plan or an entity whose  underlying  assets
include  the  assets  of any Plan by  reason of such  Plan's  investment  in the
entity,  then the  undersigned  represents and warrants that either such Plan or
the fiduciary  responsible  for the  investment and  reinvestment  of either the
assets of such Plan,  or that  portion of the assets of such Plan from which the
investment in the  Corporation  will be made,  has considered the following with
respect to such Plan's  investment in the Corporation and has determined that in
view of such  considerations,  the purchase of an interest in the Corporation is
in furtherance of and in the best interests of the participants in such Plan and
their beneficiaries:

         (A) the role such  investment or investment  course of action plays in,
as  applicable,  that  portion of such  Plan's  portfolio  which such  fiduciary
manages, or in all of the assets of such Plan;

         (B)  whether  such  investment  or  investment   course  of  action  is
reasonably  designed,  as part of, as applicable,  that portion of the portfolio
managed by such  fiduciary,  or as part of all of the  assets of such  Plan,  to
further the purposes of such Plan, taking into account both the risk of loss and
the opportunity for gain that could result therefrom;

         (C) the  composition  of, as applicable,  that portion of the portfolio
which such fiduciary manages,  or all of the assets of such Plan, with regard to
diversification of the assets of such Plan;

         (D) the  liquidity and current rate of return of, as  applicable,  that
portion of the portfolio managed by such fiduciary, or all of the assets of such
Plan, relative to the anticipated cash flow requirements of such Plan; and

         (E) the projected return of, as applicable, that portion of the
portfolio managed by such fiduciary, or all of the assets of such Plan, relative
to the funding objectives of such Plan.

         (q) The  undersigned  represents  and warrants that neither it, nor its
affiliates,  is a broker-dealer or otherwise a "Restricted  Person" as such term
has meaning under the United States National  Association of Securities Dealers,
Inc. ("NASD") Rules of Fair Practice and the related  interpretations adopted by
the NASD's Board of Governors and if the  undersigned or its affiliates  becomes
such the undersigned will promptly notify the Corporation.

         (r) The  undersigned  acknowledges  and  agrees  that  the  certificate
representing  the Ordinary Shares shall bear a restrictive  legend as counsel to
the  Corporation  may  determine is necessary or  appropriate  under  applicable
securities laws substantially to the effect of the following:

                  The Securities represented by this Certificate have not been
                  registered under the Securities Act of 1933, as amended, and
                  may not be sold, transferred, pledged or hypothecated unless
                  subsequently registered under said Act or an exemption from
                  registration is available.

         4. Covenant to Update Information.  The undersigned covenants to advise
the Corporation by telephone and in writing if any  representation  and warranty
contained herein becomes untrue.

         5. Agreement  with Respect to Resale.  The  undersigned  agrees that no
Ordinary  Shares will be resold  without  registration  under the 1933 Act, and,
where  required,  under the laws of other  jurisdictions,  or availability of an
exemption therefrom.

         6. Indemnification.  The undersigned  acknowledges that the undersigned
understands  the  meaning  and legal  consequences  of the  representations  and
warranties contained in this Agreement and agrees

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to indemnify and hold harmless the Corporation  and its  affiliates,  employees,
officers and agents and each other Subscriber from and against any and all loss,
damage, liability or expense, including,  without limitation, legal fees, due to
or arising out of a breach of any  representation or warranty of the undersigned
contained in any document  furnished by the  undersigned in connection  with the
offering and sale of the Ordinary Shares,  including,  without limitation,  this
Agreement  and  the  Investor  Suitability  Questionnaire,  and  all  schedules,
appendices  and exhibits  hereto or thereto,  submitted by the  undersigned,  or
failure by the  undersigned  to comply  with any  covenant or  agreement  by the
undersigned  herein or in any other document furnished by the undersigned to any
of the foregoing in connection with this transaction.

         7. Notices. All notices and other communications  required or permitted
under this Agreement shall be in writing, and shall be deemed to have been given
if delivered  personally,  mailed,  postage prepaid, by first class mail, to the
parties at the addresses set forth in this  Agreement or such other address as a
party may specify to the other by notice as provided in this Section.

         8.  Assignment.  This  Agreement may not be assigned or  transferred by
either party without the consent of the other party and any purported assignment
without such consent shall be null and void.

         9. Amendment and Waiver. This Agreement may be amended or modified only
by an instrument signed by the undersigned and the Corporation.  A waiver of any
provision of this Agreement  must be in writing,  designated as such, and signed
by the party against whom enforcement of that waiver is sought.  The waiver by a
party of a breach of any  provision  of this  Agreement  shall not operate or be
construed as a waiver of any subsequent or other breach thereof.

         10. Binding Effect. Except as otherwise provided herein, this Agreement
shall be  binding  upon and  inure to the  benefit  of the  undersigned  and the
Corporation  and its respective  heirs,  executors  administrators,  successors,
legal  representatives  and  assigns.  If the  undersigned  shall be  joint  and
several,  then the  representations  and warranties  herein  contained  shall be
deemed to be made by and be  binding  upon each such  person  and such  person's
heirs,   executors,   administrators,   legatees,   devisees,   assigns,   legal
representatives and successors.



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         IN WITNESS WHEREOF, the undersigned has executed this Subscription
Agreement on this 27th day of June, 2003.


Total investment:                   $137,500

GOLDSTRAND INVESTMENT


By: /s/ Seth Fireman
     Name:  Seth Fireman
     Title: Managing Director


Address:


     1040 1st Avenue, #190
Number and Street

      New York, New York 10022
City, State, Zip Code

      13-4136098
IRS Number


Accepted By:

ON TRACK INNOVATIONS LTD.



By: /s/ Oded Bashan, /s/ Ronnie Gilboa

Title: Chairman and CEO, VP Projects



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