8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): December 17, 2021 (December 16, 2021)

On Track Innovations Ltd.

(Exact Name of Registrant as Specified in Its Charter)

Israel

(State or Other Jurisdiction of Incorporation)

000-49877	N/A
(Commission File Number)	(IRS Employer Identification No.)

Hatnufa 5, Yokneam Industrial Zone, Yokneam, Israel	2069200
(Address of Principal Executive Offices)	(Zip Code)

011 972 4 6868000

(Registrant’s Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Securities registered pursuant to Section 12(b) of the Act:

		Name of each exchange on
Title of each class	Trading Symbol(s)	which registered
None

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01. Entry into a Material Definitive Agreement.

On December 9, 2020, On Track Innovations Ltd. (the “Company”) entered into a loan financing agreement with Jerry L. Ivy, Jr., Descendants’ Trust (the “Lender”). The Lender is the Controlling Shareholder of the Company (as such term is defined under the Israeli Companies Law, 5759-1999, as amended (the “Companies Law”)). The agreement was amended on January 26, 2021 (as amended, the “Agreement”) to allow for an additional lender to join the Lender and lend an additional $100,000 and provides that the Lender and the additional lender will extend a loan to the Company in the aggregate amount of up to $1,600,000 (the “Loan Amount”). The Agreement, before it was amended, was further described in the Current Report on Form 8-K filed by the Company on December 15, 2020.

The Agreement provides, among other things, that the Loan Amount and all accrued interest (the “Secured Amount”) matures upon the lapse of six months following the initial closing, i.e., on June 17, 2021 (the “Maturity Date”), and becomes payable in full on the Maturity Date, provided that the maturity date can be extended at the sole option of the majority of the lenders. On June 17, 2021, the Lender, being the majority of the lenders, exercised its option to extend the maturity date, and the parties entered into a notice of exercise of option and agreement (the “Extension Agreement”), according to which the maturity date was extended until December 17, 2021 (the “Extended Maturity Date”, and the “Extended Maturity Period”, as applicable).

On December 16, 2021, the Lender exercised its option to extend the maturity date for the second time, and the parties entered into a second notice of exercise of option and agreement (the “Second Extension Agreement”), according to which the maturity date was further extended until January 28, 2022 (the “Second Extended Maturity Date”, and the “Second Extended Maturity Period”, as applicable).

The Loan Amount had been bearing interest on all outstanding principal at an interest rate of 8.0% per annum up until the Maturity Date. During the Extended Maturity Period, the loan has been accruing interest on all outstanding principal and unpaid interest at an interest rate of 10% per annum, and it was agreed that the interest rate during the Second Extended Maturity Period shall continue to bear interest at a rate of 10% per annum. The net amount of interest on the Loan Amount accrued through December 17, 2021 was $137,818 (the “Interest Debt”). Any payment of interest is subject to withholding of taxes at source and the interest rates mentioned above are net of such withholding. Under the Second Extension Agreement, it was agreed that the Interest Debt shall be payable on the Second Extended Maturity Date, while until then it shall be considered part of the Loan Amount and shall bear the Extension Interest rate. In the event of a conversion of the Loan amount, the Loan Amount and Interest Debt (if not otherwise paid by the Company) shall convert into ordinary shares of the Company at the conversion price of $0.124, as originally contemplated under the Agreement.

Subject to the understandings detailed herein, the Agreement shall continue to be in effect and apply, in accordance with its terms.

The foregoing descriptions of the Agreement, the Extension Agreement and the Second Extension Agreement are qualified by reference to the full texts of the Agreement, the Extension Agreement and the Second Extension Agreement.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

10.1	Second Notice of Exercise of Option and Agreement dated December 16, 2021.
104	Cover Page Interactive Data File. (Embedded within the Inline XBRL document.)

1

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	On Track Innovations Ltd.
Date: December 17, 2021	By:	/s/ Assaf Cohen
	Name:	Assaf Cohen
	Title:	Chief Financial Officer

2

EX-10.1

Exhibit 10.1

December 16, 2021

To: On Track Innovations Ltd. (the “Company”)

Re: Second Notice of Exercise of Option and Agreement

This Second Notice of Exercise of Option and Letter Agreement (“Second Notice and Letter Agreement”) is provided in connection with that Loan Financing Agreement by and among the Company and the Lenders (as defined therein), dated as of December 9, 2020, as amended as of January 26, 2021 (the “Loan Agreement”), and in connection with that Notice of Exercise of Option and Agreement entered into by and among the Company and the Majority Lender as of June 17, 2021, pursuant to which, among other matters, the Maturity Period was extended until December 17, 2021 (the “First Notice and Letter Agreement”).

Terms used and not otherwise defined herein shall have such meaning ascribed to them in the Loan Agreement.

The undersigned advises the Company of the following:

1. The undersigned being the Majority Lender, hereby exercises its right under Section 1.6 of the Loan Agreement, to extend the Maturity Period.

2. Pursuant to Section 1.6 of the Loan Agreement, it is hereby agreed that the Maturity Period is extended until January 28, 2022.

3. It is further agreed, that the interest accrued on the Loan Amount and the previous Interest Debt (as defined under the First Notice and Letter Agreement) for the Maturity Period, as extended (i.e., for that time period commencing on the Initial Closing and/or the Second Closing, as the case may be, and elapsing on December 17, 2021), is equal to US$ 137,818 (the “Second Notice Interest Debt”).

4. Whereas, the Company determined that it is in its best interest, it is therefore further agreed, notwithstanding Section 4.1 of the Loan Agreement and notwithstanding the First Notice and Letter Agreement, that:

i the payment by Company of the Second Notice Interest Debt to the Lenders shall be made on January 28, 2022, and for the avoidance of doubt, such debt shall remain included in the Secured Amount for all purposes under the Loan Agreement;

ii as of the date hereof, the Loan Amount and the Second Notice Interest Debt shall both continue to accrue interest at a rate of 10% per annum and such accrued interest shall also be paid to the Lenders on January 28, 2022 (the “Extension Interest”); and

iii For the avoidance of doubt, Section 5.1(c) of the Loan Agreement exclusively shall apply in respect of the conversion of the entire Secured Amount, including without limitation, the Second Notice Interest Debt and the Extension Interest.

5. Subject only to the provisions of Sections 1, 2, 3, and 4 above, the Loan Agreement and the First Notice and Letter Agreement shall both continue to be in effect and apply, in accordance with their terms, including without limitation, as to the Maturity Period (as extended under the First Notice and Letter Agreement and under this Second Notice and Letter Agreement), and as to the Secured Amount.

6. Without derogating from Section 5 above, in the event of any contradiction or conflict between this Second Notice and Letter Agreement and the Loan Agreement and/or the First Notice and Letter Agreement, this this Second Notice and Letter Agreement shall prevail

7. If the foregoing is acceptable to you, please indicate your agreement by signing this Second Notice and Letter Agreement below.

[Signature page follows]

Sincerely,

Jerry L. Ivy, Jr. Descendants’ Trust
By:	/s/ Jerry L. Ivy
Title:	Trustee

Agreed:

On Track Innovations Ltd.
By:	/s/ Assaf Cohen
Title:	CFO

Cc:	Scott Medford
	Mark R. Beatty, Esq.
	Yoram Shiv, Adv.
	Dalit Kahana-Garbi, Adv.
	Yael Sender-Cohen, Adv.

XML

Cover	Dec. 16, 2021
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Dec. 16, 2021
Entity File Number	000-49877
Entity Registrant Name	On Track Innovations Ltd.
Entity Central Index Key	0001021604
Entity Tax Identification Number	00-0000000
Entity Incorporation, State or Country Code	L3
Entity Address, Address Line One	Hatnufa 5
Entity Address, Address Line Two	Yokneam Industrial Zone
Entity Address, City or Town	Yokneam
Entity Address, Country	IL
Entity Address, Postal Zip Code	2069200
City Area Code	011 972 4
Local Phone Number	6868000
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false