Dear On Track Innovations Ltd. Shareholders:
We cordially invite you to attend an extraordinary general meeting of shareholders of On Track Innovations Ltd. (?OTI?, the ?Company? or ?we?) to be held at the principal business office of Gornitzky & Co., located at Vitania Tel Aviv Tower, 20 Haharash St., Tel Aviv, Israel 6761310, on 2022 at 10:00 am (Israel time) (the ?Shareholder Meeting? or ?Meeting?).
At the meeting you will be asked to consider and vote upon the following proposals:
1. Approval of the acquisition of OTI by Nayax Ltd., a company incorporated under the laws of the State of Israel whose shares are traded on the Tel Aviv Stock Exchange (the ?Parent?), including the approval of: (i) the Agreement and Plan of Merger, dated as of March 17, 2022 (as it may be amended from time to time, the ?Merger Agreement?), by and among OTI, the Parent and OTI Merger Sub Ltd., an Israeli company and a wholly-owned subsidiary of the Parent (the ?Merger Sub?); (ii) the merger of Merger Sub with and into OTI (the ?Merger?) on the terms and subject to the conditions set forth in the Merger Agreement and in accordance with Sections 314-327 of the Israeli Companies Law, 5759-1999, following which Merger Sub will cease to exist as a separate legal entity and OTI will become a wholly-owned subsidiary of the Parent, with OTI being the surviving corporation in the Merger (the ?Surviving Corporation?); (iii) the consideration to be received by the shareholders of OTI in the Merger, consisting of $4,500,000 in cash, without interest and less any applicable withholding taxes (the ?Merger Consideration?), to be divided among the holders of OTI?s ordinary shares outstanding immediately prior to the effective time of the Merger; and (iv) all other transactions and arrangements contemplated by the Merger Agreement. We refer to this proposal as the ?Merger Proposal?;
2. Approval, on a non-binding, advisory basis, of certain compensation that may be paid or become payable to OTI?s executive officers in connection with the Merger and the agreements and understandings pursuant to which such compensation may be paid or become payable. We refer to this proposal as the ?Advisory Proposal?; and
3. Adjournment of the extraordinary general meeting to a later date or dates if necessary to solicit additional proxies if there are insufficient votes to approve the Merger Proposal at the time of the extraordinary general meeting. We refer to this proposal as the ?Adjournment Proposal?.
The Company?s shareholders will have the opportunity to hear from representatives of the Company?s management, who will be available at the meeting to answer questions from shareholders.
A copy of the Merger Agreement was attached as Exhibit 2.1 to OTI?s Current Report on Form 8-K that was filed with the U.S. Securities and Exchange Commission (the ?SEC?) on March 17, 2022 and is also attached as Annex A to the enclosed Proxy Statement.
The board of directors of the Company (the ?Board?) has unanimously determined that the Merger Agreement, the Merger, the Merger Consideration and all other transactions and arrangements contemplated by the Merger Agreement are in the best interests of OTI?s shareholders.
OUR BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE ?FOR? THE APPROVAL AND ADOPTION OF THE MERGER PROPOSAL, VOTE ?FOR? THE APPROVAL OF THE ADVISORY PROPOSAL AND VOTE ?FOR? THE APPROVAL OF THE AJOURNMENT PROPOSAL. OUR BOARD MADE ITS DETERMINATION AFTER EVALUATING THE MERGER IN CONSULTATION WITH OTI?S MANAGEMENT AND LEGAL ADVISORS AND CONSIDERING A NUMBER OF FACTORS. IN CONSIDERING THE RECOMMENDATION OF OUR BOARD, YOU SHOULD BE AWARE THAT THE EXECUTIVE OFFICERS OF OTI HAVE CERTAIN INTERESTS IN THE MERGER THAT MAY BE DIFFERENT FROM OR IN ADDITION TO THE INTERESTS OF OTI SHAREHOLDERS GENERALLY. SEE ?NON-BINDING ADVISORY VOTE ON TRANSACTION-RELATED COMPENSATION FOR OTI?S EXECUTIVE OFFICERS? BEGINNING ON PAGE 62 OF THE ACCOMPANYING PROXY STATEMENT FOR A MORE DETAILED DESCRIPTION OF THESE INTERESTS.
Provided that a quorum is present, the adoption and approval of the Merger Proposal at the shareholder meeting requires the affirmative vote of the holders of 75% of our ordinary shares present, in person or by proxy, at the meeting (or any adjournment or postponement thereof), excluding abstentions and broker non-votes and excluding any votes of our ordinary shares held by the Parent, Merger Sub or by any person holding at least 25% of the means of control of the Parent or Merger Sub, or any person or entity acting on behalf of the Parent, Merger Sub or any family member of, or entity controlled by any of the foregoing (any such person or entity - a ?Merger Sub Affiliate?).
In order for your vote to be counted, you must affirm on the proxy card or voting instruction form that you are not a Merger Sub Affiliate. If you do not so affirm, your vote will not count towards the tally for the merger proposal.
Your ordinary shares can be voted at the shareholder meeting only if you are present or represented by a valid proxy or proxy card. Only holders of record of the OTI?s ordinary shares at the close of business on , 2022, which the Board has set as the record date for the shareholder meeting, are entitled to attend and vote at the shareholder meeting or any adjournment or postponement thereof. Even if you plan to attend the shareholder meeting, we encourage you to submit your proxy prior to the shareholder meeting. Shares held through a bank, broker or other nominee that is a shareholder of record of OTI or that appears in the participant list of a securities depository, may also be voted via a proxy card in accordance with the instructions provided with the proxy card you received from the bank, broker or other nominee.
Important Notice Regarding the Availability of Proxy and Merger Materials
for the Meeting to be held on 2022:
The proxy statement, containing detailed information about the Merger, the Merger Proposal and the shareholder meeting, and the proxy card are also available at http://www.otiglobal.com/egm and on our proxy agent?s website at www.proxyvote.com.
Shareholders may also obtain additional paper or e-mail copies of these materials at no cost by writing to
On Track Innovations Ltd., Hatnufa 5, Yokneam Industrial Zone, Yokneam, Israel, 2069200, attention: CFO.
Thank you for your cooperation and continued support.
Very truly yours,
/s/ William C. Anderson
William C. Anderson
Chairman of the Board of Directors
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