OTI and Scheidt & Bachmann GmbH Form Strategic Alliance to Provide Leading-Edge Contactless Payment Solutions

18 September, 2003

CUPERTINO, Calif. and MOENCHENGLADBACH, Germany, Sept. 15/PRNewswire-FirstCall/ – On Track Innovations Ltd (OTI) (Nasdaq: OTIV; Prime

Standard (Frankfurt): OT5), a global leader in contactless
microprocessor-based smart card solutions and Scheidt & Bachmann GmbH, a
private German company that is one of the world’s leading providers of
management systems for car parking ticketing, mass transit, railway protection
and petrol stations, today jointly announced their strategic cooperation
agreement that will focus on Scheidt & Bachmann providing mass transit
ticketing solutions using OTI’s contactless products for electronic payment
solutions.

Scheidt & Bachmann GmbH is an innovative systems house with trusted
tradition, that develops, produces and distributes complete management systems
for gasoline stations, mass transit ticketing, car parking and leisure centers
and railway protection. OTI’s solution is a perfect fit for Scheidt &
Bachmann, giving it the ability to support the ISO 14443 industry standard for
contactless smart cards and readers, as well as enabling it to take advantage
of OTI’s product capability for use in loyalty programs and tiered fare
structures with a high level of security and transaction speed.

While the agreement encompasses a wide variety of projects, the first
joint effort is targeting automated fare collection programs. Scheidt &
Bachmann will act as the system integrator, with OTI supplying readers and
software for Scheidt & Bachmann’s front-end solutions. OTI’s solution is
based, in part, on its proprietary leading-edge solutions for electronic
payment transactions like quick serve restaurants, drive-thrus, loyalty
programs and gas stations where speed and security are essential.

Oded Bashan, President & CEO of OTI, commented, “We are very proud to be
entering into an alliance agreement with Scheidt & Bachmann, one of the
leading firms in every field they have entered. They bring tremendous
experience, expertise and advanced technological systems, as well as a
multitude of working relationships worldwide. We will continue to make
in-roads in the micro-payment arena where our solutions and technology are
second to none. As peers in the transit and parking payment industries, our
partnership is a natural fit.”

Dr. Norbert Miller, General Manager of Scheidt & Bachmann commented,
“Scheidt & Bachmann works with core competency on major and difficult
international projects for the most prestigious organizations of the world.
Our goals are very ambitious. We place a lot of expectations in the
cooperation with OTI in order to underline and extend our market leadership as
an innovative systems house.”

About OTI
Established in 1990, OTI (Nasdaq: OTIV, Prime Standard: OT5) designs,
develops and markets secure contactless microprocessor-based smart card
technology to address the needs of a wide variety of markets. Applications
developed by OTI include product solutions for micropayments, mass transit
ticketing, parking, petroleum payment systems, loyalty programs, ID and secure
campuses. OTI has a global network of regional offices to market and support
its products. The company was awarded the prestigious ESCAT Award for smart
card innovation in both 1998 and 2000. Major clients include: MasterCard, BP,
First Data Resources, Repsol, the Government of Israel and ICTS. For more
information on OTI, visit http://www.otiglobal.com .

About Scheidt & Bachmann
Scheidt & Bachmann is a family-run company since its foundation in 1872.
Today the company is still managed by the founding family in the fourth and
fifth generations. More than 1000 employees work around the world. While the
headquarters is in Monchengladbach, Germany, subsidiaries and offices are
established throughout Europe, the Americas, Asia and Africa. In the US, a
big manufacturing place is located in Burlington, Vermont. Innovative system
solutions for products and production are the foundation for Scheidt &
Bachmann’s success. The four divisions, acting more or less independently
develop, produce and market systems for car park and leisure centre
installations, protection of railway crossings, ticket vending technology and
petrol stations. Scheidt & Bachmann is constantly following up on strong
points and is systematically initiating innovative processes. This is also
one reason why Scheidt & Bachmann is counted as market leaders with all its
product divisions – in Europe and worldwide. For more information visit:
http://www.Scheidt-Bachmann.de.

This press release contains forward-looking statements within the meaning
of the United States Securities laws. Such statements are subject to certain
risks and uncertainties, such as market acceptance of new products and our
ability to execute production on orders, which could cause actual results to
differ materially from those in the statements included in this press release.
Although OTI believes that the expectations reflected in such forward-looking
statements are based on reasonable assumptions, it can give no assurance that
its expectations will be achieved. OTI disclaims any intention or obligation
to update or revise any forward-looking statements, which speak only as of the
date hereof, whether as a result of new information, future events or
otherwise.

This press release and other releases are available on http://www.otiglobal.com
and http://www.portfoliopr.com

 OTI Contact:<br />
 Galit Mendelson<br />
 Director of Corporate<br />
 Communication<br />
 212 531 3247<br />
 [email protected]<br /><br />

 S&B Contact:<br />
 Petra Eichler<br />
 Secretary Marketing<br />
 Fare Collection Division<br />
 [email protected]<br /><br />

 Agency Contacts:<br />
 Paul Holm and<br />
 Matthew Karsh<br />
 PortfolioPR<br />
 212 736 9224<br />
 [email protected]<br />
 [email protected]

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