Document:

F-3

Exhibit 10.2  

Marketing Platform
Agreement  

This Marketing Platform Agreement
(hereinafter, the “Agreement”) is effective as of June 25 2008, by and
between Structure Financial Group Ltd., with offices at Amot Mishpat House 2nd
Floor, 8 Shaul Hameleh Blvd., Tel Aviv, 64733 Israel (hereinafter,
“SFG”), and On Track Innovations Ltd., having its principal place
of business at Z.H.R. Industrial Zone, P.O. Box 32 Rosh-Pina 12000, Israel
(hereinafter,“OTI”). 

	 	WHEREAS	OTI
is a global leader in contactless microprocessor-based smart card solutions for Smart ID
solutions, homeland security, micropayments, petroleum payments and other applications;
and 

	 	WHEREAS	SFG,
either by itself or through one of its related companies, is in the business of supplying
marketing platform services, including but not limited to, promotion of and consulting in
marketing business relations for its customers (“Marketing Platform”),
inter alia, for promotion of OTI’s participation in substantial projects in
OTI’s area of occupation; and 

	 	WHEREAS	In
order to implement such Marketing Platform, OTI has opened a bank account at the Export
Import (EXIM) Bank, to be used for OTI’s existing and future projects for OTI’s
clients or suppliers, as the case may be; and 

	 	WHEREAS	the
parties wish to set forth the terms and conditions of their relationship with respect to
the purchase of the Marketing Platform and the opening of the EXIM account, all in
accordance with the terms and conditions set forth herein. 

	 	
Now
therefore the parties have agreed and declared as follows:  

	 	1.	Interpretation

	 	1.1. 	The
preamble to this agreement constitutes an integral part of this Agreement.  

	 	1.2. 	Section
headings contained in this Agreement are inserted for convenience of
               reference only, shall not be deemed to be a part of this Agreement for any
               purpose, and shall not in any way define or effect the meaning,
construction or                scope of any of the provisions hereof.  

	 	1.3. 	The
schedules constitute an integral part of this Agreement.  

	 	2.	OTI
Warrants

	 	2.1. 	OTI
warrants as follows:  

	 	2.1.1. 	This
Agreement constitutes a legally binding obligation of OTI and is
               enforceable against OTI in accordance with its terms. The execution and
delivery                of this Agreement by OTI, and the performance of its obligations
hereunder, have                been duly and validly authorized by all necessary
corporate or other action, if                required, and there is no impediment, either
at law or by agreement to                OTI’s entering into this Agreement and
performing all of its obligations                hereunder.  

	 	2.1.2. 	No
consent, approval, order or authorization of, or registration, qualification,
               designation, declaration or filing with, any federal, state or local
               governmental authority on its part is required in connection with the
               consummation of the transactions contemplated by this Agreement.  

	 	3.	SFG
Warrants and Undertake

	 	3.1. 	SFG
warrants as follows:  

	 	3.1.1. 	This
Agreement constitutes a legally binding obligation of SFG and its related
               companies and is enforceable against SFG in accordance with its terms. The
               execution and delivery of this Agreement by SFG, and the performance of
its                obligations hereunder, have been duly and validly authorized by all
necessary                corporate or other action, if required, and there is no
impediment, either at                law or by agreement to SFG’s entering into this
Agreement and performing                all of its obligations hereunder.  

	 	3.1.2. 	No
consent, approval, order or authorization of, or registration, qualification,
               designation, declaration or filing with, any federal, state or local
               governmental authority on its part is required in connection with the
               consummation of the transactions contemplated by this Agreement. SFG shall
be                deemed to have obtained on its own responsibility any additional
information,                which it considers necessary for entering into this
Agreement.  

	 	3.2. 	SFG
will make efforts in order to promote of OTI’s business for the purpose
               of obtaining the following objectives and services:  

	 	3.2.1. 	Promoting
OTI’s participation in substantial projects in OTI’s area of
               occupation, either by SFG or by one of its related companies, including
but not                limited to, consultation regarding business opportunities,
business networking                between OTI and various entities, including but not
limited to, government                ministries (including Israel), municipalities and
others (the “Project/s”);  

	 	3.2.2. 	Assisting
OTI in presenting and promoting the Projects for the purpose of
               identifying and entering into binding agreements, and assisting the
execution                and implementation of Projects, as the case may be. SFG shall
identify and                recruit third parties for the fulfillment of other parts of
the Projects,                subject to the OTI’s approval.  

	 	3.2.3. 	Obtaining
from EXIM Bank financing for such Projects (“EXIM                Account”),
and obtaining from EXIM bank funding for existing and future                OTI Projects,
for clients or suppliers as the case may be, including but not                limited to,
analysis coverage services of OT’s clients or suppliers;  

	 	3.3. 	OTI
shall at its sole discretion determine whether to submit a proposal, or to
               enter into any agreements for any Project suggested by SFG, and nothing in
this                Agreement shall be construed as an undertaking of OTI, whether
express or                implied, to enter into such agreements. Prior to the execution
of any written                agreements, OTI may reasonably decide to discontinue any
proposals or ventures                with SFG at any time and SFG shall have no demands
or claims towards OTI.  

2

	 	4.	Consideration

	 	
In
consideration for the Marketing Platform and for SFG’s consulting and promoting
services as detailed above, SFG shall be entitled to success based compensation, in the
form of warrants for the purchase of OTI’s Ordinary Shares, as follows:  

	 	4.1 	In
accordance with OTI’s board of director’s approval which shall not be
unreasonably withheld, OTI shall grant SFG and TheSpearhead Capital Ltd. (“TheSpearhead”)
equally, warrants to purchase 1,000,000 (one million) of OTI’s Ordinary Shares,
which OTI is entitled to issue to third parties under and subject to any and all
applicable US regulations and securities laws governing OTI’s shares (the “Warrants”).
The Warrants shall be at an exercise price of USD3.0 (three US dollars) per each Warrant.
In accordance with the above detailed, SFG shall be entitled to 50% of the Warrants and
TheSpearhead shall be entitled to 50% of Warrants. It is also clarified that this
paragraph may be amended only by the written consent of OTI, SFG and TheSpearhead.  

	 	4.2 	The
Warrants shall expire 10 years from the date of grant unless this Agreement is terminated
earlier.  

	 	4.3 	The
Warrants shall not be exercisable until May 30, 2010, all as detailed in the Warrant
Agreement attached hereto as Schedule A to this Agreement. It is
agreed that when a certain amount of Warrants is exercisable and/or vested, SFG shall be
entitled to exercise 50% of such amount and TheSpearhead shall be entitle to exercise the
other 50% of such amount.  

	 	4.4 	In
the event that the Warrants shall be exercised into shares held by SFG and/or
TheSpearhead, SFG and/or TheSpearhead shall grant proxies for such shares according to OTI’s
instructions.  

	 	4.5 	If
SFG shall contribute, to a cumulative sum of sales and/or funding and/or proceeds of
USD10,000,000 (ten million US dollars), then the exercise price of the Warrants which
were not been exercised by SFG shall be reduced by USD1⁄2 (half a US dollar) until
the lower limit of the par value of OTI’s Shares. In the event of a dispute between
the parties in regards to the cumulative amount, the parties shall attempt to resolve the
dispute first through good faith negotiations and if necessary, mediation. Failing
mediation, the Parties may turn to an approved arbitrator acceptable to both sides to
resolve the dispute.  

	 	
(e.g.:
at the cumulative sum of USD 8,000,000 (Eight million US dollars) the exercise price
shall be USD3 (Three US dollars). At the cumulative sum of USD 30,000,000 (Thirty million
US dollars) the exercise price of the non exercised Warrants shall be USD1.5 (One and a
half US dollar), and at the cumulative sum of USD 60,000,000 (Sixty million US Dollars)
and above, the exercise price shall be NIS 0.10 (one tenth of one New Israeli Shekels). 

3

	 	4.6 	The
Options shall be vested in quantities of 200,000 (Two hundred thousand) Warrants each
time, upon OTI receiving a firm order or a tender award, of which SFG has been directly
involved in the promotion and/or funding of, in the amount of no less than the sum of USD
1,000,000 (One million US dollars) with a potential of the amount of no less than USD
5000,000 (Five million US dollars), all as detailed in the Warrant Agreement attached
hereto as Schedule A.  

	 	4.7	It
is hereby clarified and agreed that at the date hereof, none of the Warrants nor the Ordinary
Shares underlying thereto (“Shares”), have been registered with the SEC
under the United States Securities Act of 1933 as amended (the “Securities Act”)
and such Shares may not be sold, transferred, used as collateral or otherwise
disposed of until and unless they are registered under the Securities Act
(and, where required, under the laws of one or more other jurisdictions), except
in accordance with Regulation S (“Regulation S”) under the Securities
Act, or unless another exemption from registration is then available. 

	 	4.8 	SFG
acknowledges and agrees that the certificates representing the Shares shall bear a
restrictive legend as counsel to OTI may determine are 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 and may not be transferred, sold or otherwise disposed of
in the absence of an effective registration statement with respect to the shares
evidenced by this certificate, filed and made effective under the
Securities Act of 1933, or an opinion of counsel satisfactory to On Track
Innovations Ltd. to the effect that registration under such Act is not required.”

	 	4.9 	SFG
acknowledges and agrees that, until such time as a registration statement with respect to
the Warrants has been declared effective by the SEC, all certificates, if any,
representing the Warrants shall bear, and shall be subject to, a restrictive legend.  

	 	4.10 	Until
such time as a registration statement with respect to the Warrants has been declared
effective by the SEC, SFG undertakes not to engage in hedging transactions in the United
States of America with regard to OTI Warrants unless such transactions are conducted in
compliance with the Securities Act and the United States Securities Exchange Act of 1934,
as amended (the “Exchange  Act”), and the rules and regulations
promulgated thereunder.  

	 	4.11 	OTI
hereby undertakes to complete, by no later than 180 days from the execution of this
Agreement, the necessary actions required to file a registration statement covering the
Shares with the SEC.  

4

	 	4.12 	As
soon as practically possible, OTI hereby undertakes to deliver to SFG a notice confirming
that a registration statement with respect to the Shares has been declared effective by
the SEC once it is so declared effective.  

	 	4.13 	Each
of SFG, TheSpearhead and OTI, will be responsible and liable for their own individual tax
liabilities arising out of or in connection with the exercise of the Warrants and the
sale of the Shares.  

	 	4.14 	The
parties hereby irrevocably waive, relinquish and release each other from any and all
claims, rights, demands or causes of action asserted or non-asserted which a party may
have had, now has or hereafter may have against the other party, its directors, officers,
employees, agents and/or consultants, in connection with; (i) the issuance of the
Warrants, their exercise into Shares and the sale of the Shares, including without
limitation, any fluctuations in Shares’ prices; and/or (ii) any matter concerning
the Agreement between SFG and OTI, including without limitations, failure to implement
such Agreement.  

	 	4.15 	SFG
has sufficient knowledge and experience in financial and business matters to make an
informed decision about an investment in the Shares pursuant to this Agreement. SFG has
read and reviewed the documents filed by OTI with the SEC, including, without limitation,
the Annual Report on Form 20-F filed by OTI with the SEC.  

	 	4.16 	The
Parties shall not be entitled to any reimbursement of costs and expenses incurred and
resulted from one another’s activities as under this Agreement unless agreed to in
writing by OTI  

	 	5.	REPORTING
REQUIREMENTS

	 	5.1. 	SFG
shall provide written quarterly reports to OTI concerning its activities on           its
behalf.  

	 	5.2. 	For
each report that is made, OTI shall acknowledge in writing within 30           business
days, any sales, business, projects or other undertakings that SFG has           procured
on behalf of OTI which amounts procured shall be conclusive in           determining
remuneration pursuant to this Agreement. If not such acknowledgement           is
provided by OTI within 30 business days, the reports submitted by SFG to OTI
          detailing any business it has procured shall be deemed conclusive.  

	 	6.	Right
of First Refusal

	 	
OTI
hereby provides and grants to SFG the right of first refusal during the three year period
commencing immediately after the execution of this Agreement to allow SFG sufficient time
to procure and secure financing for its Projects contemplated by this Agreement.  

5

	  	7.  	Confidentiality  

	 	
The
terms of this Agreement shall be governed by the confidentiality agreement signed by the
parties and attached hereto as Schedule B.  

	  	8.  	Intellectual
Property Rights  

	 	8.1 	The
parties agree and acknowledge that any and all of the patents, copyrights, trademarks and
other intellectual property rights used or embodied in or in connection with the Projects
or any part thereof, including all documentation, are, and shall remain the respective
property of each Party , and will not at any time be, or construed as being, the property
of the other Party, and each Party shall not during, or at any time after the expiration
or termination of this Agreement in any way question or dispute the ownership or any
other such rights unless it contributed in any way to the development of new products
that are utilized by OTI.  

	 	8.2 	The
parties also agree and acknowledge that such patents, trademarks, copyrights and other
intellectual property rights belonging to each Party may only be used by the other Party
with the mutual consent of both Parties during the term of this Agreement. Upon
expiration or termination hereof, The Parties shall forthwith discontinue such use,
without receipt of compensation for such discontinuation.  

	  	9.  	Term
and Termination  

	 	9.1 	This
Agreement shall become effective on the execution of this Agreement (the “Commencement
 Date”), and shall continue to be in full force for a period of ten (10) years
(the “Term”), subject to the terms of this Agreement  

	 	9.2 	The
Termination of this Agreement may be effected as follows: 

	 	9.2.1 	By
one party, effective immediately, upon written notice to the other party, in the event
that the other party shall become insolvent or bankrupt, discontinue its business or
adopt a resolution providing for its dissolution or liquidation.  

	 	9.2.2 	By
SFG, upon written notice to OTI, if OTI shall breach the Agreement and not remedy such
breach, where it is capable of being remedied, within thirty (30) days after notice of
the breach is received by OTI, in case of a material breach, or within sixty (60) days in
case of any other breach after notice of the breach is received by OTI.  

	 	9.2.3 	By
OTI, upon written notice to SFG, upon the occurrence of any one of the following events:
(1) no Project was secured or procured by SFG within a period of 12 months from the
Commencement Date; (2) SFG becomes engaged or involved in any activity which directly
harms or is likely to directly harm OTI or any of its affiliated companies; (3) In case
SFG shall breach the Agreement and not remedy such breach, where it is capable of being
remedied, within thirty (30) days after notice of the breach is received by SFG, in case
of a material breach, or within sixty (60) days in case of any other breach after notice
of the breach is received by SFG.  

6

	 	9.3 	If
this Agreement expires or terminates, the Parties shall cease to use one another’s
trademarks or logos, unless such use was previously authorized in writing by the other
Party to continue after such expiration or termination.  

	 	9.4 	Each
party shall return all documentation and materials and all copies thereof, which are of a
confidential nature, in its possession or control, within thirty (30) after the
expiration or termination of this Agreement  

	 	9.5 	The
expiration or termination of this Agreement for any reason shall not prejudice any rights
or obligations of either of the parties accrued up to and including the date of
expiration or termination.  

	 	9.6 	All
covenants, representations and warranties made in this Agreement shall continue to remain
in full force and effect for as long as this Agreement is still in effect pursuant to its
terms, provided however, that the rights and obligations of the parties under this
Agreement that by their nature continue beyond the expiration of this Agreement, shall
survive any termination or expiration of this Agreement, including but not limited to
provisions concerning confidentiality and intellectual property rights.  

	 	10.	Miscellaneous

	 	10.1. 	Neither
party is authorized to act for or on the behalf of the other party under
               this Agreement. Without limiting the generality of the foregoing, each
party is                an independent contractor, and no principal/agent or partnership
relationship is                created between them by this Agreement.  

	 	10.2. 	SFG
shall not be entitled to commit OTI or act as its legal representative
               unless specifically authorized to do so by a written instrument, signed by
OTI.                It is expressly agreed between the Parties that the activities of SFG
are                restricted to the rights and obligations under this Agreement. SFG
will not be                entitled to incur any obligation of any nature on behalf of
OTI, unless agreed                to in writing.  

	 	10.3. 	For
the avoidance of doubt, it is hereby agreed that this Agreement shall not
               constitute and shall not be construed as a partnership, joint venture, a
               commercial agency relationship, employer’s–employee relationship
or                the like between OTI and SFG or any of its key persons. SFG performs
its                obligations pursuant to this Agreement as an independent contractor, a
fact that                has been taken into account in determining the consideration
under this                Agreement.  

	 	10.4. 	This
Agreement constitutes the entire understanding between the parties with
               respect to the subject matter hereof. Any prior understandings,
undertakings or                representations, written or oral, shall be of no force or
effect. Neither this                Agreement nor any terms hereof may be modified,
amended, waived or terminated                except by an instrument in writing signed by
both parties.  

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	 	10.5. 	Should
any dispute arise between the parties in connection with this Agreement,
               they shall make their best efforts to resolve such a dispute amicably
amongst                themselves. This Agreement shall be governed by and construed
according to the                laws of the State of Israel, without regard for the
choice of law provisions                thereof. All disputes, controversies, differences
or questions arising out of or                relating to this Agreement, or to the
validity, interpretation, breach,                violation of term thereof, will be
finally and solely determined and settled                only by the competent courts in
Tel-Aviv.  

	 	10.6. 	None
of the rights, privileges or obligations set forth in or created by this
               Agreement may be assigned or transferred without the prior consent in
writing of                each party to this Agreement, with the exception of assignments
and transfers                from OTI to any entity which controls, is controlled by or
is under common                control with OTI. No assignment or transfer under this
Agreement shall be made                unless the transferee agrees to be bound by all
agreements binding upon the                transferor immediately prior to such transfer.  

	 	10.7. 	All
notices and other communications required or permitted to be given under
               this Agreement shall be in writing and shall be deemed to have been duly
given                and received: (a) ninety six (96 ) hours after being deposited in
the mail,                postage prepaid for registered airmail and addressed to the
addressee at its                address as indicated herein above; (b) when receipt
acknowledged, if sent by fax                or e-mail, or (c) at the time delivered, if
delivered by hand.  

	 	10.8. 	NOTICE
TO SFG shall be to: 

	 	
Structured
Financial Group Ltd. 

	 	
Attn:
Mr. Asher Goldwasser  

	 	
Amot
House, 8 Shaul Hamelech Ave. 2nd floor, Tel Aviv 64733 ISRAEL  

	 	
Tel:
+972-3-6098898; Fax: +972-3-6098895  

	 	
NOTICE
TO OTI shall be to:  

	 	
On
Track Innovations Ltd.  

	 	
Attn:
Mr. Oded Bashan, CEO with a copy to the legal department, 

	 	
Z.H.R.          Industrial
Zone, P.O.Box 32 Rosh Pina 12000, ISRAEL  

	 	
Tel:
+972-4-6868000; Fax: +972-4-6938887  

	 	
NOTICE
TO TheSpearhead Capital shall be to:  

	 	
TheSpearhead
Capital Ltd.  

	 	
Attn:
Mr. Yitzchak Babayov  

	 	
5
Shahaf street, Hod-Hasharon, Israel, 45351 

	 	
Tel:
+972-54-4832465; Fax: +972-77-4340457  

	 	10.9. 	The
invalidity of any term, condition or stipulation of this Agreement shall not
               affect the validity of the remaining terms, conditions or stipulations of
this                Agreement or the validity of the Agreement itself. This Agreement
embodies the                entire understandings and obligation between the parties and
supersedes all                prior agreements and undertakings in respect of the subject
matter hereof.  

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IN WITNESS WHEREOF, each of the
parties hereto has caused this Agreement to be signed as of the date  first written
above. 

			
			
			
			
			
	Structure Financial Group Ltd. 	On Track Innovations Ltd. 	TheSpearhead Capital Ltd. 
	 
	By: /s/ Asher Goldwasser	By: /s/ Oded Bashan	By: /s/ Yitzchak Babayov
	 
	Name & Title:__________	Name & Title: _________	Name & Title: _________
	 
	Date: 25/6/08	Date: 25/6/08	Date: 25/6/08

9F-3

Exhibit 10.3  

THIS WARRANT AND THE SECURITIES
ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS, AND
MAY NOT BE SOLD OR TRANSFERRED UNLESS (I) A REGISTRATION STATEMENT COVERING SUCH
SECURITIES IS EFFECTIVE UNDER THE SECURITIES ACT OR (II) THE TRANSACTION IS EXEMPT FROM
REGISTRATION UNDER THE SECURITIES ACT, AND, IF THE COMPANY REQUESTS, AN OPINION
SATISFACTORY TO THE COMPANY TO SUCH EFFECT HAS BEEN RENDERED BY COUNSEL. 

ON TRACK INNOVATIONS
LTD. 

WARRANT 

		
		
		
		
		
	Warrant No. 2008-10 - 1	Dated:  June 25, 2008 

        On
Track Innovations Ltd., an Israeli company (the “Company”),
hereby certifies that, Structure Financial Group Ltd., with offices at Amot Mishpat
House 2nd Floor, 8 Shaul Hameleh Blvd., Tel Aviv, 64733 Israel (the “Holder”) is
entitled to purchase from the Company up to a total of 500,000 (as adjusted from time to
time as provided in Section 7) Ordinary Shares (as defined below) (each such share,
a “Warrant Share” and all such shares, the
“Warrant Shares”) at an exercise price specified in Section
4 below (as adjusted from time to time as provided in Section 7, the “Exercise
Price”), at any time and from time to time commencing on May 1, 2010
(the “Initial Exercise Date”) through the Expiration Date
(as defined below), and subject to the following terms and conditions. This Warrant is one
of three similar warrants (the “Warrants”) issued pursuant
to that certain Marketing Platform Agreement dated June 25, 2008 (the “MP
Agreement”) by and between the Company and Structure Financial Group Ltd.
(“SFG”).  

         1.       
          Definitions. The capitalized terms used herein and not otherwise defined
          shall have the meanings set forth below: 

	 	        “Affiliate ”means
an entity controlling, controlled by or under common control with a Person and if such
entity is a person, then the immediate family of such person. For the purpose of this
definition of Affiliate, “control” shall mean the ability
to direct the activities of the relevant entity and shall include the holding of 50% or
more of the issued and outstanding share capital, voting rights or other ownership
interests of such entity or the right to appoint 50% or more of the directors (or the
equivalent thereof) in such entity, or in case of a partnership shall also include, a
general manager of such entity, or a partner of such entity or an entity managed by such
entity.  

	 	        “Eligible
Market” means any of the New York Stock Exchange, the American Stock
Exchange or Nasdaq.  

	 	        “Ordinary
Shares” means the ordinary shares of the Company, NIS 0.10 nominal
value, as constituted on the issuance date of this Warrant.  

	 	        “Person ”means
any individual or corporation, partnership, trust, incorporated or unincorporated
association, joint venture, limited liability company, joint stock company, government
(or an agency or subdivision thereof) or other entity of any kind.  

	 	        “Trading
Day” means (a) any day on which the Ordinary Shares are listed or
quoted and traded on any Eligible Market or (b) if the Ordinary Shares are not then
quoted and traded on any Eligible Market, then a day on which trading occurs on Nasdaq
(or any successor thereto).  

	 	        “Warrant
Shares” shall mean Ordinary Shares issued or issuable from time to
time upon exercise of this Warrant (subject to adjustment pursuant to Section 7 below).  

         2.       
          Registration of Warrant. The Company shall register this Warrant, upon
          records to be maintained by the Company for that purpose (the
          “Warrant Register”), in the name of the record
          Holder hereof. The Company may deem and treat the registered Holder of this
          Warrant as the absolute owner hereof for the purpose of any exercise hereof or
          any distribution to the Holder, and for all other purposes, absent actual notice
          to the contrary. 

         3.       
          Vesting of Warrants. 

		    (a)        The
Warrants shall be vested in quantities of 100,000 (one hundred thousand)
          warrants each time and only when the Company and/or its subsidiaries           (“OTI”)
receive a firm orders or tender awards (each, a “Project”), in which SFG
has been directly involved in the           promotion and/or funding of, and provided
that in such each Project provides to           OTI an the amount of no less than of US$
1,000,000 (One million US$) with a           potential of an additional amount of not
less than US$ 5,000,000 (Five million           USD).  

		    (b)        Such
allocation of Warrants shall be on a Project by Project basis. Each Project
          shall be limited to a single vesting of Warrants in quantities of 100,000 (one
          hundred thousand), even if the amounts received by OTI (or potential amounts)
          exceed the amounts detailed in subsections (a) above.  

		    (c)        Notwithstanding
anything to the contrary, unvested Warrants may not be           exercised.  

         4.       
          Exercise Price of Warrant Shares. 

		    (a)        The
initial exercise price of each Warrant shall be US$ 3.00 (three US$).  

2

		    (b)        However,
if SFG contributes to OTI a cumulative sum of sales and/or funding           and/or
proceeds of US$ 10,000,000 (ten million US$), then the exercise price of           each
Warrant (not yet exercised) shall be decreased by US$ 0.50 (fifty US cents)           for
each such US$ 10,000,000 contribution, but in no event shall the exercise           price
be less than the par value of the Company’s shares. In an event of           dispute
between SFG and the Company with regard to the cumulative amount           specified
above, SFG and the Company shall attempt to resolve the dispute first           through
good faith negotiations and if necessary, mediation. Failing mediation,           SFG and
the Company may turn to an approved single arbitrator acceptable to SFG           and the
Company to resolve the dispute.  

	 	        The
exercise price set forth above, whether or not reduced, shall be referred to as “Exercise
 Price”.  

         5.       
          Exercise and Duration of Warrant. 

		    (a)        This
Warrant may be exercisable by the registered Holder with regard to the           Warrant
Shares, at any time commencing May 1, 2010, provided, however that the           Warrant
Shares so exercised are vested. The Warrant shall be exercisable until           the
earlier of (i) the termination date of the MP Agreement, or (ii) 5:00 P.M.,           New
York City time on May 1, 2018 (“Expiration Date”).  

		    (b)        A
Holder may exercise this Warrant by delivering to the Company (i) an exercise
          notice (a copy of which can be obtained from the Company’s secretary),
          appropriately completed and duly signed, delivered or by facsimile, and (ii)
          payment of the Exercise Price for the number of Warrant Shares as to which this
          Warrant is being exercised and the date such items are received by the Company
          is an “Exercise Date.” Execution and delivery of
          the Exercise Notice shall have the same effect as cancellation of the original
          Warrant and issuance of a New Warrant evidencing the right to purchase the
          remaining number of Warrant Shares, if any.  

		    (c)        The
Holder shall pay the Exercise Price in cash, by certified bank check payable           to
the order of the Company or by wire transfer of immediately available funds           in
accordance with the Company’s instructions  

		    (d)        This
Warrant is exercisable, either in its entirety or, from time to time,           during
its duration, for a portion of the number of Warrant Shares, subject to           Section
3 and 4 above. Upon surrender of this Warrant following one or more           partial
exercises, the Company shall issue or cause to be issued, at its           expense, a New
Warrant evidencing the right to purchase the remaining number of           Warrant
Shares.  

         6.       
          Delivery of Warrant Shares. 

		    (a)        Upon
exercise of this Warrant and subject to the receipt of signed originals,           the
Company shall promptly, but in no event later than the thirty Trading Day
          following such exercise, issue or cause to be issued and deliver or cause to be
          delivered to the Holder, in the Holder’s name, a certificate for the
          Warrant Shares issuable upon such exercise bearing (only if such legend is
          required by applicable law) the required restrictive legend. The Holder, or any
          Person so designated by the Holder to receive the Warrant Shares, shall be
          deemed to have become the holder of record of such Warrant Shares as of the
          Exercise Date.  

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         7.       
          Certain Adjustments. The Exercise Price and number of Warrant Shares
          issuable upon exercise of this Warrant are subject to adjustment from time to
          time as set forth in this Section 7. 

		    (a)        Share
Splits. If the Company, at any time while this Warrant is           outstanding, (i)
subdivides outstanding Ordinary Shares into a larger number of           shares, or (ii)
combines outstanding Ordinary Shares into a smaller number of           shares, then in
each such case the Exercise Price shall be adjusted to reflect           the new par
value of the outstanding Ordinary Shares, if any and the number of           Warrant
Shares shall remain unchanged. Any adjustment pursuant to this Section 7(a) shall
become effective immediately after the effective date           of such subdivision or
combination.  

		    (b)        Fundamental
Transactions. If, at any time while this Warrant is           outstanding, (i) the
Company effects any merger or consolidation of the Company           with or into another
Person (for the avoidance of doubt, not including the           acquisition of another
corporation or its assets for shares of the Company),           (ii) the Company effects
any sale of all or substantially all of its assets in           one or a series of
related transactions or (iii) there shall occur any merger of           another Person
into the Company whereby the Ordinary Shares are cancelled,           converted or
reclassified into or exchanged for other securities, cash or           property (in any
such case, a “Fundamental Transaction”), then, as a
condition to the consummation of           such Fundamental Transaction, the Company
shall (or, in the case of any           Fundamental Transaction in which the Company is
not the surviving entity, the           Company shall take all reasonable efforts to
cause such other Person to) execute           and deliver to the Holder of the Warrants a
written instrument providing that:  

	 	        (x)
 long as any Warrant remains outstanding on such terms and subject to such
          conditions as shall be as nearly equivalent as may be practicable to the
          provisions set forth in this Warrant, each Warrant, upon the exercise thereof
at           any time on or after the consummation of such Fundamental Transaction, shall
be           exercisable into, in lieu of Ordinary Shares issuable upon such exercise
prior           to such consummation, the securities or other property (the
          “Substituted Property”) that would have been
          received in connection with such Fundamental Transaction by a holder of the
          number of Ordinary Shares into which such Warrant was exercisable immediately
          prior to the consummation of such Fundamental Transaction, assuming such holder
          of Ordinary Shares:  

	 	        (A)
          is not a Person with which the Company is consolidated or into which the Company
merged or which merged into the Company or to which such sale or transfer was made (for
the avoidance of doubt, not including the acquisition of another corporation or its assets
for shares of the Company), as the case may be (a “Constituent
Person”), or an Affiliate of a Constituent Person; and 

	 	        (B)
          failed to exercise such Holder’s rights of election, if any, as to the
kind           or amount of securities, cash and other property receivable in connection
with such Fundamental Transaction (provided, however, that if the kind or amount
of securities, cash or other property receivable in connection with such Fundamental
Transaction is not the same for each Ordinary Share held immediately prior to such
Fundamental Transaction by a Person other than a Constituent Person or an Affiliate
thereof and in respect of which such rights of election shall not have been exercised (a
“Non-Electing Share”), then, for the purposes of this Section
7(b), the kind and amount of securities, cash and other property receivable in
connection with such Fundamental Transaction by each Non-Electing Share shall be deemed
to be the kind and amount so receivable per share by a plurality of the Non-Electing
Shares); and  

4

	 	        (y)
          the rights and obligations of the Company (or, in the event of a transaction in
          which the Company is not the surviving Person, such other Person) and the
          Holders in respect of Substituted Property shall be as nearly equivalent as may
          be practicable to the rights and obligations of the Company and Holders in
          respect of Ordinary Shares hereunder.  

	 	        Such
written instrument shall provide for adjustments which, for events subsequent to the
effective date of such written instrument, shall be as nearly equivalent as may be
practicable to the adjustments provided for in Section 7. The above provisions of
this Section 7(b) shall similarly apply to successive Fundamental Transactions.  

         8.       
          Fractional Shares. The Company shall not be required to issue or cause to
          be issued fractional Warrant Shares on the exercise of this Warrant. If any
          fraction of a Warrant Share would, except for the provisions of this Section, be
          issuable upon exercise of this Warrant, the Company shall make a cash payment to
          the Holder equal to (a) such fraction multiplied by (b) Exercise Price, or make
          other lawful arrangements that can be made under applicable law. 

         9.       
          Restricted Securities. The Holder represents and warrants that it (i)
          understands that the Warrant and the Warrant Shares have not been registered
          under the Securities Act and (ii) understands the restrictions set forth on the
          legend printed on the face of this Warrant. 

         10.       
          Notices. Any and all notices or other communications or deliveries
          hereunder (including without limitation any Exercise Notice) shall be in writing
          and shall be mailed by certified mail, return receipt requested, or by a
          nationally recognized courier service or delivered (in person or by facsimile),
          against receipt to the party to whom such notice or other communication is to be
          given. The address for such notices or communications shall be as set forth in
          the MP Agreement. Any notice or other communication given by means permitted by
          this Section 10 shall be deemed given at the time of receipt as specified
          in the MP Agreement. 

         11.       
          Miscellaneous. (a) This Warrant or any interest therein may not be
          assigned, transferred, pledged or otherwise disposed by the Holder, without the
          Company’s prior written consent. This Warrant shall be binding on and inure
          to the benefit of the parties hereto and their respective successors and
          assigns. This Warrant may be amended only in writing signed by the Company and
          the Holder and their successors and assigns. 

		    (b)        This
Warrant shall be governed by and construed according to the laws of the           State
of Israel (without giving effect to its conflict of law provisions). Any
          dispute or other matter arising under or in relation to this Warrant (other
than           as set forth in Section 4(b) above) shall be resolved by the competent
court of           the city of Tel-Aviv-Jaffa and each of the parties hereby submits
exclusively           and irrevocably to the jurisdiction of such court.  

		    (c)        The
headings herein are for convenience only, do not constitute a part of this
          Warrant and shall not be deemed to limit or affect any of the provisions
hereof.  

5

		    (d)        In
case any one or more of the provisions of this Warrant shall be deemed           invalid
or unenforceable in any respect, the validity and enforceability of the
          remaining terms and provisions of this Warrant shall not in any way be affected
          or impaired thereby and the parties will attempt in good faith to agree upon a
          valid and enforceable provision which shall be a commercially reasonable
          substitute therefor, and upon so agreeing, shall incorporate such substitute
          provision in this Warrant.  

		    (e)        In
the event of a conflict between this Warrant and the MP Agreement with regard
          to the subject matter hereof, the terms of this Warrant shall govern.  

        IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its authorized
officer as of the date first indicated above. 

			ON TRACK INNOVATIONS LTD.

By: /s/ Oded Bashan
——————————————

Oded Bashan
Chairman and Chief Executive Officer

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