OTI Reports on Status of U.S. Electronic Passport Project

FORT LEE, N.J., July 31  /PRNewswire-FirstCall/ -- On Track Innovations Ltd., (OTI) (NASDAQ:OTIV), a global leader in contactless microprocessor- based smart card solutions for homeland security, payments and other applications, reported that the Government Printing Office (GPO) has notified OTI that it has been eliminated from the group of vendors being considered for the United States Government's Electronic Passport program.  OTI intends to appeal the decision.

As previously reported, in December 2005 the United States Court of Federal Claims in Washington, D.C. found in favor of OTI America, Inc. ("OTI"), in OTI's protest against the Government Printing Office's ("GPO") earlier elimination of OTI from the competition and ordered for OTI to be reinstated. Originally, OTI, along with several other firms, received an individual contract with the GPO, under which the GPO was testing and evaluating sample Electronic Passports, prior to selecting the winner.

According to Oded Bashan, President & CEO, "OTI is obviously disappointed with the GPO decision and strongly disagree with the grounds for such. We are confident in the superiority of our product and we are continuing with the appeal process."

About OTI

Established in 1990, OTI (NASDAQ:OTIV) 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 petroleum payment systems, homeland security solutions, electronic passports and IDs, payments, mass transit ticketing, parking, loyalty programs and secure campuses. OTI has a global network of regional offices to market and support its products. The company was awarded the Frost & Sullivan 2005 Company of the Year Award in the field of smart cards. For more information on OTI, visit http://www.otiglobal.com/.

Safe Harbor for Forward-Looking Statements:

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other Federal securities laws.  Whenever we use words such as "believe," "expect," "anticipate," "intend," "plan," "estimate" or similar expressions, we are making forward-looking statements.  Because such statements deal with future events and are based on OTI's current expectations, they are subject to various risks and uncertainties and actual results, performance or achievements of OTI could differ materially from those described in or implied by the statements in this press release.  For example, forward-looking statements include statements regarding our goals, beliefs, future growth strategies, objectives, plans or current expectations.  Forward-looking statements could be impacted by market acceptance of new and existing products and our ability to execute production on orders, as well as the other risk factors discussed in OTI's Annual Report on Form 20-F for the year ended December 31, 2005, which is on file with the Securities and Exchange Commission.  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 circumstances or otherwise.

   OTI Contact:                            Media Relations
   Galit Mendelson                         Adam Handelsman
   Director of Corporate Communications    5W Public Relations
   201 944 5200 ext. 111                   212 999 5585
                        

DATASOURCE: On Track Innovations Ltd.



CONTACT:  Galit Mendelson, Director of Corporate Communications of OTI,

[phone] ext. 111, ; or Adam Handelsman of 5W Public

Relations, [phone], 



Web site:  http://www.otiglobal.com/ 

Copyright