Patriot Rail executes agreement to operate railroad in North Carolina

Patriot Rail Corp. said it has executed a long-term license and operating agreement with the North Carolina Department of Transportation to commence rail service on the Piedmont and Northern Railway in Gaston County, North Carolina. Under the 20-year agreement, Patriot will be responsible for operating, maintaining and marketing freight rail service on the P&N.

The P&N, located
approximately 20 miles west of Charlotte, N.C., is a 13-mile rail line that
extends from Mount Holly to Gastonia, with a spur line towards Belmont. The
railroad has strategic interchanges with Class 1 railroads Norfolk Southern
Railway at Gastonia and CSX Transportation at Mount Holly. As part of the refurbishment
of the rail line, NCDOT has completed an upgrade of the westernmost four miles
of the rail line from Gastonia to Ranlo, and anticipates upgrading the
remainder of the line during the spring of 2011. Patriot expects to commence
rail service on the westernmost four miles in the first quarter of 2011. The
rail line was purchased by NCDOT in 1991 and preserved as a rail corridor for
future service.

"We are pleased to add the ‘new’
P&N, our seventh railroad, to the Patriot family of railroads," said Gary
Marino, chairman, president and CEO of Patriot Rail. "We have commenced the job
of building business on the railroad and have been encouraged by the customer
prospects. This railroad is in an ideal location for rail freight customers due
to the dual Class 1 interchange and close proximity to a major transportation
hub such as Charlotte. In addition, we look forward working with local
interests, including the Gaston County Economic Development Commission and
NCDOT, to attract new customers to the P&N."

Patriot Rail Corp. is a
short line and regional freight railroad holding company based in Boca Raton,
Fla., that owns and operates seven short line freight railroads comprising 344
total rail miles in nine states. By year-end 2010 Patriot Rail is expected to
double its size as it completes the acquisition of Weyerhaeuser Company’s six
freight railroads, which operate more than 160 miles of rail line in four
states.