On January 23, 2024, FreightCar America, Inc. entered into three separate royalty agreements with Jes's Salvador Gil Benavides, a Mexican individual (the Royalty Agreement - Salvador", and collectively with the Royalty Agreement - Jes s and the Royalty Agreement - Alejandro, the Royalty Agreements). The Royalty Payees are the lessors of the Company's manufacturing facility in Castaos, Mexico, Royalty Payee - Jes's is a member of the Company's Board of Directors, and Royalty Payee - Alejandro is the beneficial owner of 11.8% of the Company's common stock. Under each Royalty Agreement, the Company shall pay to the Royalty Payees royalties consisting of a total of 1.2% on revenue received from railcars and a total of 1.5% on revenue received from tank cars, as applicable, that are built, converted, modified, refurbished or repaired at the Castaos Facility, or elsewhere within Mexico, during certain production line periods.

Each Royalty Agreement shall end upon the termination of the last applicable production line period, unless terminated earlier pursuant to such Royalty Agreement. The foregoing description of the Royalty Agreements does not purport to be complete and is qualified by reference to the full text of the Royalty Agreements to be filed as exhibits to the Company's Quarterly Report on Form 10-Q for the period ending March 31, 2024. On January 23, 2024, the Company, Fabricaciones y Servicios de M xico, S.A. de C.V., Agben de Mexico, S.A. deC.V., Industrial Mexicana Fasemex, S.A. de c.V., Proveedora Industrial para el Manejo de Materiales, S.A. de CAD 8, 2022 .

No early termination penalties were incurred in connection with the termination of the First Royalty Agreement. Accordingly, the Company's obligations under the First Royalty Agreement are deemed satisfied in full and the First Royalty Agreement is terminated.