EXHIBIT 10.46



                            ON TRACK INNOVATIONS LTD.

                             Subscription Agreement


THE ORDINARY SHARES, THE WARRANTS AND THE ORDINARY SHARES ISSUABLE UPON EXERCISE
OF THE WARRANTS 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  AND  THE  WARRANTS.  ANY  REPRESENTATION  TO THE  CONTRARY  IS
UNLAWFUL.  THE ORDINARY  SHARES,  THE WARRANTS AND THE ORDINARY  SHARES ISSUABLE
UPON  EXERCISE  OF THE  WARRANTS  MAY NOT BE  SOLD,  TRANSFERRED,  OR  OTHERWISE
DISPOSED OF BY AN INVESTOR  UNLESS THE  ORDINARY  SHARES , THE  WARRANTS AND THE
ORDINARY  SHARES  ISSUABLE UPON  EXERCISE OF THE WARRANTS  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, THE WARRANTS
AND THE ORDINARY  SHARES ISSUABLE UPON EXERCISE OF THE WARRANTS MUST BE PREPARED
TO BEAR THE ECONOMIC RISK OF THE INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.


                                                       Dated as of July 10, 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 181,818
ordinary  shares,  NIS 0.1 nominal value (the  "Ordinary  Shares"),  and related
warrants to purchase  Ordinary Shares (the  "Warrants") 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 the  Warrants and
agrees to become a Subscriber for the amount set forth herein  immediately above
the signature of the undersigned.  The purchase price per Ordinary Share is U.S.
$2.75.

         (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  and the  Warrants  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, the Warrants
and the Ordinary  Shares  issuable  upon  exercise of the Warrants 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,  the Warrants and the Ordinary  Shares  issuable upon
exercise of the Warrants 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 and the  Warrants  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  Warrants  or made any  finding  or  determination  as to the
         fairness of this investment;

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<PAGE>

                  (ii) the  Ordinary  Shares and the  Warrants  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 and the Warrants.

         (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 and
the  Warrants  (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 and the Warrants.

         (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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<PAGE>

         (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,  the Warrants and the Ordinary Shares issuable
upon exercise of the Warrants 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,  Warrants  or  Ordinary  Shares  issued  upon  exercise of the
Warrants will be resold  without  registration  under the 1933 Act,  and,  where
required, under the laws of other jurisdictions, or availability of an exemption
therefrom.

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<PAGE>

         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 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,
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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<PAGE>

                         SIGNATURE PAGE FOR INDIVIDUALS



         IN WITNESS  WHEREOF,  the  undersigned  has executed this  Subscription
Agreement on this _____ day of July, 2003.


Total investment:                   $___________________

Number of Ordinary Shares           ____________________

Number of Ordinary Shares underlying Warrants _________________



Print Name of Individual


___________________________________
Signature of Individual


Legal Residence of Individual:


___________________________________
Number and Street

___________________________________
City, State, Zip Code

___________________________________
Social Security Number


Mailing Address if different from above:


___________________________________
Number and Street

___________________________________
City, State, Zip Code

___________________________________
Social Security Number


Accepted By:

ON TRACK INNOVATIONS LTD.



By:   __________________________________

Title:________Chairman and CEO__________

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                    ACKNOWLEDGMENT FOR INDIVIDUAL SUBSCRIBERS

                           To be completed by Notary.

STATE OF___________________________

COUNTY OF_________________________



         On this ____ day of July,  2003,  before  me,  the  undersigned  Notary
Public,  duly  commissioned  and  sworn,   personally  appeared  __________  and
personally  known to me (or proved to me on the basis of satisfactory  evidence)
to be the person(s)  whose name is (or whose names are) subscribed to the within
instrument, and subscribed and swore to such instrument and acknowledged that he
(or she or they) executed the same.


         IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate above written.


[SEAL]  __________________________________

(Notary Public in and for the aforesaid County and State)


My Commission Expires:_______________________________










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<PAGE>

                        SIGNATURE PAGE FOR CORPORATIONS,
      PARTNERSHIPS, TRUSTS, LIMITED LIABILITY COMPANIES, LIMITED LIABILITY
                        PARTNERSHIPS AND OTHER ENTITIES


         IF  THE  SUBSCRIBER  IS  A  CORPORATION,  PARTNERSHIP,  TRUST,  LIMITED
LIABILITY COMPANY,  LIMITED LIABILITY PARTNERSHIP OR OTHER ENTITY,  COMPLETE THE
FOLLOWING  SIGNATURE  LINES  TO THE  SUBSCRIPTION  AGREEMENT  AND  HAVE A NOTARY
COMPLETE THE APPROPRIATE ACKNOWLEDGMENT ON THE FOLLOWING PAGES:

         IN WITNESS  WHEREOF,  the  undersigned  has executed this  Subscription
Agreement on this ____ day of July, 2003.


Total investment:                   $500,000

Number of Ordinary Shares           181,818

Number of Ordinary Shares underlying Warrants 90,909


Print  Name of  Corporation,  Partnership,  Trust,  Limited  Liability  Company,
Limited Liability Partnership or Other Entity: Herald Investment Trust PLC

By: /s/ Drene Jackson
     Signature of Officer or Other Authorized Representative*

Print Name and Title of Officer or Other Authorized Representative:
Drene Jackson, Fund Manager

Location of Principal Place of Business of Corporation, Partnership, Trust,
Limited Liability Company, Limited Liability Partnership or other Entity:

12 Charterhouse Sq.                               London, ECIM 6AX
Name and Street                                   City, State, Zip Code


Mailing Address (if different from above):

______________________________                    ______________________________
Name and Street                                   City, State, Zip Code

_______________________________
Tax Identification Number of Corporation,  Partnership, Trust, Limited Liability
Company, Limited Liability Partnership or other Entity


Accepted By:                              Accepted By:

ON TRACK INNOVATIONS LTD.                 ON TRACK INNOVATIONS LTD.


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

Title: President                          Title: VP Projects


* (Only an officer or other representative of such corporation, partnership,
trust, limited liability company, limited liability partnership or other entity
who is authorized to execute this document on behalf of such entity should sign
this Agreement.)

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                   ACKNOWLEDGMENT FOR CORPORATION SUBSCRIBERS

                           To be completed by Notary.


STATE OF:____________________
COUNTY OF:__________________


         On this ____ day of July,  2003,  before  me,  the  undersigned  Notary
Public,     duly     commissioned     and     sworn,     personally     appeared
____________________________,  to me known,  who,  being by me duly  sworn,  did
depose and say that he or she  resides  at  ____________________________________
and that he or she is the ___________________ of  ________________________,  the
corporation described in and which executed the foregoing instrument and that he
or she is authorized to execute this instrument on behalf of such corporation.

         IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate above written.

[Seal]___________________________________
(Notary Public in and for the aforesaid County and State)

My Commission Expires:_______________________








                                       9
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                   ACKNOWLEDGMENT FOR PARTNERSHIP SUBSCRIBERS

                           To be completed by Notary.


STATE OF:_______________________
COUNTY OF:_____________________


         On this ____ day of July,  2003,  before  me,  the  undersigned  Notary
Public,  duly commissioned and sworn,  personally  appeared  __________________,
personally  known to me (or proved to me on the basis of satisfactory  evidence)
to be the individual who executed the foregoing  instrument and, who, being duly
sworn  by me,  did  depose  and say  that he or she is a  member  of the firm of
___________________________,   and  that  he  or  she  executed  the   foregoing
instrument  in the  firm  name  of  _________________  and  that  he or she  had
authority to sign the same, and acknowledged that he or she executed the same as
the act and deed of said firm.

         IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate above written.

[Seal]___________________________________
(Notary Public in and for the aforesaid County and State)

My Commission Expires:____________________________







                                       10
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                      ACKNOWLEDGMENT FOR TRUST SUBSCRIBERS

                           To be completed by Notary.


STATE OF_________________
COUNTY OF_______________

         On this ____ day of July,  2003,  before  me,  the  undersigned  Notary
Public,     duly     commissioned     and     sworn,     personally     appeared
____________________________  ,  personally  known to me (or proved to me on the
basis of  satisfactory  evidence)  to be the  trustee  under  the  Trust for the
benefit of  _____________________  and known to me to be the person who executed
the within  instrument  and  acknowledged  to me that he, she or it executed the
same.

         IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate above written.

[Seal]__________________________________
(Notary Public in and for the aforesaid County and State)

My Commission Expires:______________________







                                       11
<PAGE>

            ACKNOWLEDGMENT FOR LIMITED LIABILITY COMPANY SUBSCRIBERS

                           To be completed by Notary.


STATE OF:_______________________
COUNTY OF:_____________________


         On this ____ day of July,  2003,  before  me,  the  undersigned  Notary
Public,  duly commissioned and sworn,  personally  appeared  __________________,
personally  known to me (or proved to me on the basis of satisfactory  evidence)
to be the individual who executed the foregoing  instrument and, who, being duly
sworn by me, did depose and say that he or she is the manager and/or a member of
the  firm  of  ___________________________,  and  that  he or she  executed  the
foregoing  instrument in the firm name of  _________________  and that he or she
had  authority to sign the same,  and  acknowledged  that he or she executed the
same as the act and deed of said firm.

         IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate above written.

[Seal]___________________________________
(Notary Public in and for the aforesaid County and State)

My Commission Expires:____________________________






                                       12
<PAGE>



          ACKNOWLEDGMENT FOR LIMITED LIABILITY PARTNERSHIP SUBSCRIBERS

                           To be completed by Notary.


STATE OF:_______________________
COUNTY OF:_____________________


         On this ____ day of July,  2003,  before  me,  the  undersigned  Notary
Public,  duly commissioned and sworn,  personally  appeared  __________________,
personally  known to me (or proved to me on the basis of satisfactory  evidence)
to be the individual who executed the foregoing  instrument and, who, being duly
sworn  by me,  did  depose  and say  that he or she is a  member  of the firm of
___________________________,   and  that  he  or  she  executed  the   foregoing
instrument  in the  firm  name  of  _________________  and  that  he or she  had
authority to sign the same, and acknowledged that he or she executed the same as
the act and deed of said firm.

         IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate above written.

[Seal]___________________________________
(Notary Public in and for the aforesaid County and State)

My Commission Expires:____________________________







                                       13