FreightCar America, Inc. Announces Final Repositioning Steps

Acquires partner’s 50% interest in the Castaños, Mexico joint venture

Announces recapitalization plan to bolster balance sheet, expand Castaños, Mexico manufacturing operation, and support future growth

CHICAGO, Oct. 19, 2020 (GLOBE NEWSWIRE) -- FreightCar America, Inc. (NASDAQ: RAIL) (“FreightCar America” or the “Company”) announced the final strategic steps to reposition its business for long-term growth.

Highlights:

• Completed transaction and now owns 100% of its new Castaños, Mexico manufacturing operation (“Castaños”), where all future railcar manufacturing is expected to be based by February 2021
• Enters into new $40 million secured term loan agreement with a global investment management firm (“Lender”), with funding subject to the satisfaction of certain conditions, to strengthen balance sheet and drive its growth strategy
• Will welcome two new members to its board of directors including Jesus Gil, General Manager of the Castaños joint venture and an owner of Fabricaciones y Servicios de Mexico SA. de C.V. (“Fasemex”), who will also become the Company’s new Vice President of Operations, and a future representative from the Lender following the closing of the new capital plan
• Announces plan to host a virtual special meeting of stockholders necessary to complete the term loan funding by late November
• Will host a special call to review its go forward strategy at 8:30 a.m. (Eastern Daylight Time) tomorrow, October 20, 2020
  

“Today is an exciting day and new beginning for FreightCar America as we announce the last steps in our plan to reposition the business for long-term growth,” said Jim Meyer, President and Chief Executive Officer. “We exit a prolonged period when our business was hampered by high costs, sustained losses and a generally challenged competitive position. We now enter a new chapter, where our business will be supported by a single new production facility designed specific to our needs, a highly experienced and cost competitive workforce, and a significantly enhanced competitive profile that includes a $25 million reduction in annual fixed costs achieved through the closures of our two facilities in Cherokee, Alabama (“Shoals”) and Roanoke, Virginia.”