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STOCK PURCHASE AGREEMENT

Stock Purchase Agreement

STOCK PURCHASE AGREEMENT | Document Parties: GREENBRIER LEASING, L.P. | GUNDERSON RAIL SERVICES LLC | MERIDIAN RAIL HOLDINGS CORP | Olympus Growth Fund IV, L.P You are currently viewing:
This Stock Purchase Agreement involves

GREENBRIER LEASING, L.P. | GUNDERSON RAIL SERVICES LLC | MERIDIAN RAIL HOLDINGS CORP | Olympus Growth Fund IV, L.P

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Title: STOCK PURCHASE AGREEMENT
Governing Law: Delaware     Date: 11/2/2006
Law Firm: Tonkon Torp LLP;Kirkland Ellis LLP    

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                                                                   EXHIBIT 10.34

                            STOCK PURCHASE AGREEMENT

                                      among

                          GUNDERSON RAIL SERVICES LLC,

                             the Sellers party hereto,

                                       and

                          MERIDIAN RAIL HOLDINGS CORP.

                                October 15, 2006

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                            STOCK PURCHASE AGREEMENT

          THIS STOCK PURCHASE AGREEMENT (this "Agreement") is made as of October
15, 2006, by and among Gunderson Rail Services LLC, an Oregon limited liability
company ("Buyer"), Meridian Rail Holdings Corp., a Delaware corporation (the
"Company"), the Persons listed on the signature pages hereto under the heading
"Sellers" (collectively referred to herein as the "Sellers" and individually as
a "Seller") and Olympus Growth Fund IV, L.P. as the "Seller Representative".
Capitalized terms used and not otherwise defined herein have the meanings set
forth in Article XII.

          WHEREAS, the Sellers collectively own (i) all of the issued and
outstanding capital stock of the Company as of the date hereof, which consists
of 33,392.43 shares of the Company's Common Stock, par value $0.01 per share
("Common") and 48,880 shares of the Company's Series A Preferred Stock, par
value $0.01 per share ("Preferred" and together with the Common, the "Shares")
and (ii) warrants currently exercisable to purchase 542.97 shares of Common and
794.80 shares of Preferred (the "Warrants"), which are collectively the only
outstanding equity securities of Company.

          WHEREAS, upon the terms and subject to the conditions set forth
herein, Buyer desires to acquire from the Sellers, and the Sellers desire to
sell to Buyer, all of the Shares which are issued and outstanding and owned by
the Sellers as of the Closing Date.

          WHEREAS, simultaneously with the Closing (as defined below), Buyer
will contribute a sufficient amount of cash to cancel the Warrants in exchange
for the cash payment provided for and on the terms and conditions herein.

          NOW, THEREFORE, in consideration of the premises, representations and
warranties and mutual covenants contained herein and of other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

                                   ARTICLE I

                                PURCHASE AND SALE

     1.01 Delivery of Estimates; Calculation of Estimated Common Purchase Price.

          (a) At least two business days before the Closing Date, the Company
shall deliver to Buyer a certificate (the "Closing Payment Certificate"), which
Closing Payment Certificate shall be subject to the review and approval of the
Seller Representative, setting forth (i) its good faith estimate of the Cash On
Hand (such estimate is referred to as the "Estimated Cash on Hand"), (ii) its
good faith estimate of the Net Working Capital Amount (such estimate is referred
to as the "Estimated Net Working Capital Amount"), (iii) its good faith estimate
of the Pre-Closing Tax Amount (such estimate is referred to as the "Estimated
Pre-Closing Tax Amount"), (iv) the Aggregate Preferred Purchase Price and the
portion of the Aggregate Preferred Purchase Price to be delivered to each holder
of Preferred, (v) its good faith estimate of the Estimated Common Purchase Price
(as defined below), (vi) the Indebtedness Payoff Amount, (vii) the individual
Common Warrant Cancellation Payments (as defined below) to be delivered to each
holder of Warrants to purchase Common and the individual Preferred Warrant
Cancellation Payments (as defined below) to be delivered to each holder of
Warrants to purchase Preferred, as more fully set forth on Section 1.05 of the
Disclosure Schedules (such estimates are collectively referred to as the
"Estimated Warrant Cancellation Payments") and (viii) the aggregate amount of
Sellers' Expenses


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(such estimate is referred to as the "Estimated Sellers' Expenses"). Section
1.01(a) of the Disclosure Schedules sets forth a calculation of the amounts
described in this Section 1.01(a) and the payments to be made pursuant to
Section 1.03(b) based on information available as of the date of this Agreement
and certain assumptions as to items that cannot be determined until the Closing
Date.

          (b) For purposes hereof, the "Estimated Common Purchase Price" means
an amount equal to (A) $227,500,000, plus (B) the Estimated Cash on Hand, minus
(C) the Indebtedness Payoff Amount, plus (D) the amount, if any, by which the
Estimated Net Working Capital Amount exceeds the Target Net Working Capital
Amount (such amount, if any, the "Closing Date Working Capital Increase
Amount"), minus (E) the amount, if any, by which the Target Net Working Capital
Amount exceeds the Estimated Net Working Capital Amount, minus (F) the Estimated
Pre-Closing Tax Amount, minus (G) the Aggregate Preferred Purchase Price, minus
(H) without duplication, the aggregate amount, if any, of Estimated Sellers'
Expenses (as detailed in the Closing Payment Certificate), minus (I) the
aggregate amount of the Estimated Warrant Cancellation Payments. The Estimated
Common Purchase Price shall be adjusted after Closing as set forth in Section
1.04 below.

     1.02 Purchase and Sale of Shares.

          (a) Purchase and Sale of Preferred. As of the Closing, upon the terms
and subject to the conditions set forth in this Agreement, each Seller shall
sell, assign, transfer and convey to Buyer, and Buyer shall purchase and acquire
from each Seller, all of the shares of Preferred held by such Seller as such
ownership is set forth on Section 1.02 of the Disclosure Schedules. The purchase
price to be paid by Buyer to each Seller for the shares of Preferred held by
such Seller shall consist of a payment at the Closing, by wire transfer of
immediately available funds to the account designated by such Seller at least
two business days before the Closing, of an amount of cash equal to the sum of
the Preferred Per Share Prices for all shares of Preferred held by such Seller
as of immediately prior to the Closing.

          (b) Purchase and Sale of Common. As of the Closing, upon the terms and
subject to the conditions set forth in this Agreement, each Seller shall sell,
assign, transfer and convey to Buyer, and Buyer shall purchase and acquire from
each such Seller, all of the shares of Common held by such Seller as such
ownership is set forth on Section 1.02 of the Disclosure Schedules. The purchase
price to be paid by Buyer at the Closing to each Seller for the shares of Common
held by such Seller shall consist of a payment at the Closing, by wire transfer
of immediately available funds to the account designated by such Seller at least
two business days before the Closing, of an amount of cash equal to the product
of (x) the Estimated Common Purchase Price, multiplied by (y) the number of
shares of Common held by such Seller as of immediately prior to the Closing
divided by (z) the number of shares of Common issued and outstanding immediately
prior to the Closing. Such payment shall be subject to the Purchase Price
True-Up Holdback as described below.

     1.03 The Closing; Payment for Shares, Indebtedness and Sellers' Expenses.

          (a) The closing of the transactions contemplated by this Agreement
(the "Closing") shall take place at the offices of Kirkland & Ellis LLP located
at 200 East Randolph Drive, Chicago, Illinois at 12:00 noon on November 7, 2006
(via facsimile, telephone, mail and other mutually acceptable means of
communication and delivery) or if any of the conditions to the Closing set forth
in Article II (other than those to be satisfied at the Closing) have not been
satisfied or waived by the party entitled to the benefit thereof then on the
second business day following satisfaction or waiver of all of the closing
conditions set forth in Article II (other than those to be satisfied at the
Closing) or on such other date as is mutually agreeable to Buyer and the Seller
Representative. The date on which the Closing shall occur is


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referred to herein as the "Closing Date." Except as otherwise provided in this
Agreement, all proceedings to be taken and all documents to be executed at the
Closing shall be deemed to have been taken, delivered and executed
simultaneously, and no proceeding shall be deemed taken nor documents deemed
executed or delivered until all have been taken, delivered and executed.

          (b) Upon the terms and subject to the conditions set forth in this
Agreement, the parties hereto shall consummate the following transactions as of
the Closing:

               (i) Buyer shall disburse (or cause such disbursement to be made)
     the amount (without duplication) of the Aggregate Preferred Purchase Price,
     the Estimated Warrant Cancellation Payments, the Estimated Sellers'
     Expenses and the Estimated Common Purchase Price as set forth on the
     Closing Payment Certificate and in accordance with the flow of funds
     memorandum attached to the Closing Payment Certificate and as follows:

               (A) Buyer shall deliver to each of the Sellers who are selling
          Preferred, the Preferred Per Share Price in exchange for each share of
          Preferred held by such Seller immediately prior to the Closing;

               (B) Buyer shall deliver (on behalf of the Company in accordance
          with Section 1.05) to each of the Sellers who are canceling Warrants
          to purchase Preferred, its share of the Preferred Warrant Cancellation
          Payments in exchange for canceling the Warrants to purchase Preferred
          held by such Seller immediately prior to Closing;

               (C) Buyer shall disburse an amount equal to (i) $1,000,000 plus
          (ii) the Closing Date Working Capital Increase Amount (if any)
          (collectively, the "Purchase Price True-Up Holdback") and the Escrow
          Amount to U.S. Bank National Association, as the escrow agent (the
          "Escrow Agent") by wire transfer of immediately available funds,
          pursuant to instructions delivered to Buyer by the Escrow Agent to be
          held pursuant to the Holdback Agreement;

               (D) Buyer shall disburse an amount equal to the Seller
          Representative Reserve to the Seller Representative by wire transfer
          of immediately available funds, pursuant to instructions delivered to
          Buyer by the Seller Representative to be held in accordance with
          Section 10.05;

               (E) after payment of the amounts set forth above, Buyer shall
          deliver to each of the Sellers who are selling Common the
          consideration specified in Section 1.02(b) in exchange for all shares
          of Common held by such Seller immediately prior to Closing, minus such
          Seller's Holdback Share of the sum of the Purchase Price True-Up
          Holdback, and such Seller's Percentage Share of the Escrow Amount and
          the Seller Representative Reserve;

               (F) after payment of the amounts set forth above, Buyer shall
          deliver (on behalf of the Company in accordance with Section 1.05) to
          each of the Sellers who are canceling Warrants to purchase Common, its
          share of the Common Warrant Cancellation Payments in exchange for
          canceling the Warrants to purchase Common held by such Seller
          immediately prior to Closing, minus such Seller's Holdback Share of
          the sum of the Purchase Price True-Up Holdback, and such Seller's
          Percentage Share of the Escrow Amount and the Seller Representative
          Reserve;


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               (G) Except as provided below in subsection (H) with respect to
          bonuses to employees of the Company, Buyer shall pay, or cause to be
          paid, on behalf of the Sellers and the Company, (i) the Estimated
          Sellers' Expenses by wire transfer of immediately available funds to
          accounts specified by the Seller Representative prior to the Closing
          in the Closing Payment Certificate, and (ii) the Indebtedness Payoff
          Amount in accordance with the terms of payoff letters with respect
          thereto;

               (H) Buyer shall contribute to the Company that portion of
          Sellers' Expenses which represents the bonuses to be paid to certain
          employees at the Closing and that portion of Sellers' Expenses which
          represents the employer portion of any and all applicable federal,
          state and local employer payroll-related Taxes, employer matching
          contributions on 401(k) deferrals, FICA, Medicare and other employer
          liabilities, obligations or payments with respect to such bonuses and
          the Company shall withhold any applicable withholding Tax, which
          amounts are required to be deducted and withheld pursuant to
          applicable Tax law, before the Company remits the remaining amount of
          such bonuses to the employees. The Company shall remit such
          withholding Taxes to the appropriate Taxing authority;

               (ii) Each Seller shall deliver to Buyer the certificates
     representing the Shares held by such Seller, duly endorsed for transfer or
     accompanied by appropriate transfer documents, and each holder of a Warrant
     shall deliver to Buyer the Warrant Cancellation Agreement referenced in
     Section 1.05 with respect to each Warrant held by such holder; and

               (iii) Buyer, the Company and the Sellers shall make such other
     deliveries as are required by and in accordance with Article II hereof.

     1.04 Final Calculations.

          (a) Determination. As promptly as possible, but in any event within 75
days after the Closing Date, Buyer will deliver to the Seller Representative a
consolidated balance sheet of the Company as of 11:59 p.m. (New York City time)
on the day immediately preceding the Closing Date and a reasonably detailed
statement (the "Closing Statement") setting forth Buyer's calculations of (i)
Cash on Hand, (ii) the Net Working Capital Amount, (iii) the Pre-Closing Tax
Amount, (iv) the Sellers' Expenses, (v) a recalculation of the Common Purchase
Price and (vi) a recalculation of the Common Warrant Cancellation Payments.
After delivery of the Closing Statement, the Seller Representative and its
accountants shall be permitted reasonable access to review the Company's and its
Subsidiaries' books and records and work papers related to the preparation of
the Closing Statement. The Seller Representative and its accountants may make
inquiries of Buyer, the Company and their respective accountants and officers
regarding questions concerning or disagreements with the Closing Statement
arising in the course of their review thereof, and Buyer shall use its, and
shall cause the Company and its Subsidiaries to use their, reasonable best
efforts to cause any such accountants and officers to cooperate with and respond
to such inquiries. If the Seller Representative has any objections to the
Closing Statement, the Seller Representative shall deliver to Buyer a written
statement setting forth its objections thereto (an "Objections Statement"). If
an Objections Statement is not delivered to Buyer within 60 days after delivery
of the Closing Statement, the Closing Statement shall be final, binding and
non-appealable by the parties hereto. The Seller Representative and Buyer shall
negotiate in good faith to resolve any objections set forth in the Objections
Statement (and all such discussions related thereto shall, unless otherwise
agreed by Buyer and the Seller Representative, be governed by Rule 408 of the
Federal Rules of Evidence (and any applicable similar state rule)), but if they
do not reach a final resolution within 15 days after the


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delivery of the Objections Statement, the Seller Representative and Buyer shall
submit such dispute for resolution to and by KPMG LLP (the "Independent
Auditor"). Each of Buyer and the Seller Representative agrees to execute, if
requested by the Independent Auditor, an engagement letter containing reasonable
and customary terms, including an indemnification against claims asserted by the
respective parties. The Seller Representative and Buyer shall use their
commercially reasonable efforts to cause the Independent Auditor to resolve all
such disagreements as soon as practicable. The resolution of the dispute by the
Independent Auditor shall be final, binding and non-appealable on the parties
hereto. The Independent Auditor shall act as an arbitrator to determine, based
upon the provisions of this Section 1.04(a), only the disputed items and the
determination of each amount of the disputed items shall be made in accordance
with the procedures set forth in Section 1.04(a) and, in any event, shall be no
less than the lesser of the amount claimed by either Buyer or the Seller
Representative, and shall be no greater than the greater of the amount claimed
by either Buyer or the Seller Representative. The Closing Statement shall be
modified if necessary to reflect such determination. The fees and expenses of
the Independent Auditor shall be allocated to be paid by Buyer, on the one hand,
and the Sellers (from the Purchase Price True-Up Holdback, to the extent the
Deficiency (if any) plus any such fees and expenses payable by the Sellers to
the Independent Auditor hereunder are less than or equal to the amount of funds
in the Purchase Price True-Up Holdback), on the other hand, based upon the
percentage which the portion of the contested amount not awarded to each party
bears to the amount actually contested by such party, as determined by the
Independent Auditor. The obligation of any Seller to pay such fees and expenses
to the Independent Auditor shall be several and limited to such Seller's
Holdback Share.

          (b) Final Adjustment Amount. Without duplication, all amounts owed
based on the calculations in the Closing Statement shall be aggregated, and the
net amount (if any) owed by Buyer to the Sellers, on the one hand, or the
Sellers to Buyer, on the other hand, is referred to as the "Final Adjustment
Amount." The Final Adjustment Amount shall be calculated as an adjustment to
each of the Estimated Common Purchase Price and the Common Warrant Cancellation
Payments and the Common Purchase Price, as so adjusted, is referred to herein as
the "Final Common Purchase Price."

          (c) Adjustments.

               (i) Positive Adjustment. If the Final Common Purchase Price is
     equal to or greater than the Estimated Common Purchase Price estimated at
     Closing (such amount that is greater than the Estimated Common Purchase
     Price shall be referred to as the "Excess"), Buyer shall pay to the Seller
     Representative the Excess, if any, which shall be paid by the Seller
     Representative to each Seller based on such Seller's Holdback Share, and
     the Seller Representative, on behalf of the Sellers, and Buyer shall direct
     the Escrow Agent to pay to such Sellers their Holdback Share of all funds
     deposited and remaining in the Purchase Price True-Up Holdback.

               (ii) Negative Adjustment. If the Final Common Purchase Price is
     less than the Estimated Common Purchase Price estimated at Closing (such
     amount that is less than the Estimated Common Purchase Price shall be
     referred to as the "Deficiency") and the Deficiency is less than or equal
     to the amount of funds deposited in the Purchase Price True-Up Holdback,
     the Seller Representative, on behalf of the Sellers, and Buyer shall direct
     the Escrow Agent to pay to Buyer the amount of the Deficiency from the
     funds deposited and remaining in the Purchase Price True-Up Holdback and
     direct that the balance of the Purchase Price True-Up Holdback (if any) be
     paid to the Sellers in accordance with their Holdback Share.


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               (iii) Other Adjustment. If the Deficiency is greater than the
     amount of funds deposited in the Purchase Price True-Up Holdback (such
     difference, the "Shortfall"), the Seller Representative, on behalf of the
     Sellers, and Buyer shall direct the Escrow Agent to pay to Buyer all funds
      deposited and remaining in the Purchase Price True-Up Holdback, and (x) at
     the sole election of Buyer, Buyer shall be entitled to take all or any
     portion of the Shortfall from the Escrow Amount and (y) the Sellers shall
     pay the Shortfall to Buyer, or such portion of the Shortfall not received
     by Buyer from the Escrow Amount to Buyer, with each Seller's obligation
     being several and limited to such Seller's Holdback Share of the Shortfall.

               (iv) Payment of the Adjustments. Payment of these adjustment
     amounts shall be paid by delivery of immediately available funds to the
     account designated by the recipient party(ies) (or if such payor is a
     Seller, such Seller may, with the consent of Buyer, pay by certified check
     or money order) within three business days of the date of final
     determination. All such adjustments shall be deemed adjustments to the
     Final Common Purchase Price for all Tax purposes.

          (d) Enforcement. If any Seller does not pay the amounts required to be
paid to Buyer under Section 1.04(c)(iii) within the time frame specified under
Section 1.04(c)(iv) once such amounts are finally determined hereunder,
notwithstanding anything to the contrary in this Agreement, Buyer shall be
entitled to recover from such Seller all costs, fees and expenses, including
attorneys' fees, incurred in connection with any action brought by Buyer to
enforce payment of such amounts, and in any petition for appeal or appeals
therefrom or in bankruptcy, in addition to any other relief to which Buyer may
be entitled. If Buyer does not pay the amounts required to be paid to the
Sellers under Section 1.04(c)(iii) within the time frame specified under Section
1.04(c)(iv) once such amounts are finally determined hereunder, notwithstanding
anything to the contrary in this Agreement, the Seller Representative shall be
entitled to recover from Buyer all costs, fees and expenses, including
attorneys' fees, incurred in connection with any action brought by the Seller
Representative on behalf of the Sellers to enforce payment of such amounts, and
in any petition for appeal or appeals therefrom or in bankruptcy, in addition to
any other relief to which the Sellers may be entitled.

     1.05 Warrants. Immediately prior to the Closing (and subject to the terms
and conditions hereof), the Company shall cause each holder of Warrants set
forth on Section 1.05 of the Disclosure Schedules attached hereto to cancel and
deliver to the Company for cancellation all Warrants held by such Person in
exchange for the Warrant Cancellation Payments to be made by the Company on the
Closing Date, in each case pursuant to an executed warrant cancellation
agreement substantially in the form of Exhibit A attached hereto (the "Warrant
Cancellation Agreements"). Buyer shall cause the Company to make such Warrant
Cancellation Payments concurrently with the consummation of the Closing. For
purposes hereof, the "Common Warrant Cancellation Payments" means an amount
equal to (i) the aggregate number of shares of Common subject to the Warrant,
times the aggregate amount the holders of the Warrant would have been entitled
to receive under Section 1.02(b) assuming the Warrant had been exercised as of
the Closing, minus (ii) the aggregate amount of the applicable exercise prices
per share of Common subject to such Warrant. For purposes hereof, the "Preferred
Warrant Cancellation Payments" means an amount equal to (i) the aggregate number
of shares of Preferred subject to the Warrant, times the aggregate amount the
holders of the Warrant would have been entitled to receive under Section 1.02(a)
assuming the Warrant had been exercised as of the Closing, minus (ii) the
aggregate amount of the applicable exercise prices per share of Preferred
subject to such Warrant. The Common Warrant Cancellation Payments and the
Preferred Warrant Cancellation Payments are referred to collectively herein as
the "Warrant Cancellation Payments." The Common Warrant Cancellation Payments
shall be subject to the Purchase Price True-Up Holdback as described herein.


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     1.06 Termination of Agreements. Reference is hereby made to that certain
Stockholders Agreement of the Company, dated on or about November 23, 2004 (as
amended, modified or supplemented from time to time, the "Company Stockholders
Agreement"). Each of the Sellers, to the extent such Seller is a party to any of
the agreements and documents referenced in this Section 1.06, acknowledges and
agrees for the benefit of the other parties thereto and hereto that, upon
consummation of the Closing, all of such agreements and documents and all rights
and obligations of the parties under (i) the Company Stockholders Agreement and
(ii) all agreements and documents identified in the Disclosure Schedules as
terminating in connection with the Closing, shall each terminate without
obligation or liability to any party thereunder or hereunder. The Company hereby
acknowledges and agrees for the benefit of the other parties hereto that
effective upon the Closing the 2005 Management Bonus Plan will terminate and all
bonuses earned and accrued under those plans, including those listed on item 13
of Section 4.13(a) of the Disclosure Schedules, shall be paid out of Cash by the
Company at Closing. The parties hereto further acknowledge and agree that such
payment by the Company is payment in full, and as of the Closing the 2005
Management Bonus Plan shall be of no further force or effect, and neither the
Company nor the Sellers shall have any further obligations thereunder or any
continuing liability to any party thereto.

                                   ARTICLE II

                              CONDITIONS TO CLOSING

     2.01 Conditions to Buyer's Obligations. The obligation of Buyer to
consummate the transactions contemplated by this Agreement is subject to the
satisfaction (or Buyer's written waiver) of the following conditions as of the
Closing Date:

          (a) The representations and warranties set forth in Articles III and
IV shall be true and correct at and as of the Closing Date as though then made
(without giving effect to any materiality or Material Adverse Effect qualifiers
contained in such representations and warranties and in the case of
representations and warranties that address matters as of particular dates which
shall be true and correct at and as of such particular dates), except where the
failure of such representations and warranties to be so true and correct would
not, individually or in the aggregate, have a Material Adverse Effect;

          (b) The Company and the Sellers shall have performed in all respects
the covenants and agreements under Section 6.01(b)(xii) and 6.01(c) and in all
material respects all of the other covenants and agreements required to be
performed by them under this Agreement at or prior to the Closing;

          (c) The applicable waiting periods, if any, under the HSR Act shall
have expired or been terminated;

          (d) Since the date of this Agreement, there shall have been no
Material Adverse Effect;

          (e) Since the date of this Agreement, there has been no new litigation
commenced or, to the Company's knowledge, threatened, against the Company or its
Subsidiaries other than which would not, individually or in the aggregate, be
reasonably expected to have a Material Adverse Effect;


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          (f) No statute, rule, regulation, judgment, decree, ruling, injunction
or order shall have been enacted or entered and no action, suit or proceeding
shall have been instituted which restrains, enjoins, prohibits, invalidates or
otherwise prevents the consummation of the transactions contemplated hereby;

          (g) All consents, approvals, filings, notices and waivers which are
set forth on Section 2.01(g) of the Disclosure Schedules shall have been
obtained;

          (h) At or prior to the Closing, each Seller shall deliver to Buyer a
certificate in the form of U.S. Treasury Regulations Section
1.1445-2(b)(2)(iv)(A) or (B), as the case may be, or, at the option of the
Sellers, an affidavit, under penalties of perjury, stating that the Company is
not and has not been a United States real property holding corporation, dated as
of the Closing Date and in form and substance required under Treasury Regulation
Section 1.897-2(h) so that Buyer is exempt from withholding any portion of the
Purchase Price thereunder;

          (i) The Wheelset Supply and Services Agreement dated November 9, 1999
shall be in full force and effect to the same extent such agreement was in
effect prior to the Closing (subject to among other things, for the avoidance of
doubt, the disclosures set forth in Section 2.01(i) of the Disclosure
Schedules);

          (j) The existing Employment Agreements with each of Rick Turner and
Frank Cristelli, as amended and restated by the Employment Agreement Amendments,
executed prior to the date hereof and the Employment Agreement with William
Holcomb executed prior to the date hereof, shall have been duly authorized and
be in full force and effect against each of Rick Turner, Frank Cristelli and
William Holcomb;

          (k) Buyer shall have received evidence reasonably satisfactory to it
that the following agreements of the Company have been terminated in connection
with the Closing: (i) the Advisory Services Agreement dated as of November 23,
2004 between the Company and Olympus Advisory Partners, Inc. and (ii) the
Company Stockholders Agreement dated as of November 23, 2004 among the Company
and the stockholders party thereto;

          (l) Buyer shall have received, dated as of the Closing Date and
addressed to Buyer, substantially in the form of Exhibit B attached hereto an
opinion of Kirkland & Ellis LLP, legal counsel to Olympus Growth Fund IV, L.P.
("Olympus") and the Company; and

          (m) The Company or the Seller Representative (on behalf of the
Sellers), as the case may be, shall have delivered to Buyer each of the
following:

               (i) a certificate of the Company in a form reasonably
     satisfactory to Buyer, dated as of the Closing Date, stating that the
     preconditions specified in Sections 2.01(a) and (b), as they relate to the
     Company have been satisfied;

               (ii) a certificate of Olympus in a form reasonably satisfactory
     to Buyer, dated as of the Closing Date, stating that the preconditions
     specified in Sections 2.01(a) and (b), as they relate to Olympus have been
     satisfied;

               (iii) a certificate of each Seller other than Olympus in a form
      reasonably satisfactory to Buyer, dated as of the Closing Date, stating
     that the preconditions specified in Sections 2.01(a) and (b), as they
     relate to such Seller have been satisfied, or, at the option of the


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<PAGE>

     Company, a certificate of the Company in a form reasonably satisfactory to
     Buyer, dated as of the Closing Date, stating that, to the Company's
     knowledge, the preconditions specified in Sections 2.01(a) and (b), as they
     relate to such Seller have been satisfied;

               (iv) copies of customary payoff letters from all holders of
     Indebtedness for borrowed money to be paid at Closing as part of the
     Indebtedness Payoff Amount in a form reasonably satisfactory to Buyer
     (which payoff letters shall be attached to the Closing Payment
     Certificate), and provide to Buyer recordable lien releases simultaneously
     with the Closing;

               (v) fully executed Warrant Cancellation Agreements which shall be
     in full force and effect;

               (vi) the Holdback Agreement fully executed by Sellers and the
     Escrow Agent which shall be in full force and effect;

               (vii) resignations effective as of the Closing Date from such
      officers and directors of the Company and its Subsidiaries as Buyer shall
     have requested in writing and delivered to the Company and the Seller
     Representative not less than five days prior to the Closing Date;

               (viii) a copy of the certificate of incorporation of the Company
     (certified by the Secretary of State of Delaware) and a certificate of good
     standing from the State of Delaware for the Company dated within fifteen
     days of the Closing Date; and

                (ix) certified copies of the resolutions duly adopted by the
     Company's board of directors authorizing the execution, delivery and
     performance of this Agreement and the other agreements contemplated hereby,
     and the consummation of the transactions contemplated hereby and thereby,
     including termination of the agreements and documents identified in Section
     1.06 above.

          (n) The Sellers and the Company shall have delivered to Buyer such
other documents as Buyer may reasonably request for the purpose of facilitating
the consummation or performance of any of the transactions contemplated by this
Agreement, including, without limitation, the Shares and appropriate stock
powers.

If the Closing occurs, all closing conditions set forth in this Section 2.01
which have not been fully satisfied as of the Closing shall be deemed to have
been fully waived by Buyer.

     2.02 Conditions to the Sellers' and the Company's Obligations. The
obligations of the Sellers and the Company to consummate the transactions
contemplated by this Agreement are subject to the satisfaction (or the written
waiver by the Seller Representative on behalf of the Sellers and the Company) of
the following conditions as of the Closing Date:

          (a) The representations and warranties set forth in Article V shall be
true and correct at and as of the Closing as though then made (without giving
effect to any materiality or material adverse effect qualifiers contained in
such representations and warranties and in the case of those representations and
warranties that address matters as of particular dates which shall be true and
correct at and as of such particular dates), except where the failure of such
representations and warranties to be so true and correct would not, in the
aggregate, have a material and adverse effect on Buyer's ability to consummate
the transactions contemplated by this Agreement;


                                       9

<PAGE>

          (b) Buyer shall have performed in all material respects all the
covenants and agreements required to be performed by it under this Agreement at
or prior to the Closing;

          (c) The applicable waiting periods, if any, under the HSR Act shall
have expired or been terminated;

          (d) No statute, rule, regulation, judgment, decree, ruling, injunction
or order shall have been enacted or entered and no action, suit or proceeding
shall have been instituted which restrains, enjoins, prohibits, invalidates or
otherwise prevents the consummation of the transactions contemplated hereby;

          (e) All consents and approvals which are set forth on Section 2.02(e)
of the Disclosure Schedules attached hereto shall have been obtained;

          (f) The Seller Representative shall have received, dated as of the
Closing Date and substantially in the form of Exhibit C attached hereto an
opinion of Tonkon Torp LLP, legal counsel to Buyer and Guarantor;

          (g) Buyer shall have delivered to the Seller Representative certified
copies of the resolutions duly adopted by Buyer's and the Guarantor's board of
directors (or its equivalent governing body) authorizing the execution, delivery
and performance of this Agreement and the other agreements contemplated hereby,
and the consummation of all transactions contemplated hereby and thereby; and

          (h) Buyer shall have delivered to the Seller Representative a
certificate in the form reasonably satisfactory to the Seller Representative,
dated as of the Closing Date, stating that the preconditions specified in
Sections 2.02(a) and (b) have been satisfied.

If the Closing occurs, all closing conditions set forth in this Section 2.02
which have not been fully satisfied as of the Closing shall be deemed to have
been fully waived by the Sellers and the Company.

                                  ARTICLE III

                               REPRESENTATIONS AND
                            WARRANTIES OF EACH SELLER

          Except as disclosed in the disclosure schedules attached hereto (the
"Disclosure Schedules"), each Seller, solely for himself, herself or itself (on
a several and not joint basis), represents and warrants to Buyer as of the date
hereof and as of the Closing Date, as follows:

     3.01 Organization and Standing. Each Seller that is an entity represents
and warrants that it is duly organized, formed or incorporated and is validly
existing and in good standing under the laws of the state of its incorporation
or organization.

     3.02 Authority. Such Seller has all requisite legal capacity, power and
authority (including, if applicable, full organizational power and authority) to
execute and deliver this Agreement and to perform such Seller's obligations
hereunder.

     3.03 Execution and Delivery; Valid and Binding Agreement. This Agreement
and the other Transaction Documents to which such Seller is a party has been
duly authorized, executed and delivered by such Seller. Assuming this Agreement
and the other Transaction Documents are the valid and binding


                                       10

<PAGE>

agreement of each of the other parties thereto, this Agreement and the
Transaction Documents to which such Seller is a party constitute a valid and
binding agreement of such Seller, enforceable against such Seller in accordance
with its terms, except as enforceability may be limited by bankruptcy laws,
other similar laws affecting creditors' rights and general principles of equity
affecting the availability of specific performance and other equitable remedies.

     3.04 No Breach. Except for the applicable requirements of the HSR Act and
compliance with applicable federal and state securities laws, such Seller is not
subject to or obligated under any applicable law, or rule or regulation of any
governmental authority, or any material agreement or instrument, or any license,
franchise or permit, or its certificate of incorporation, its bylaws or similar
organizational documents if such Seller is a corporation or other entity, or
subject to any order, writ, injunction, judgment or decree, which would be
breached or violated in any material respect by such Seller's execution,
delivery or performance of this Agreement, the Transaction Documents or the
consummation of the transactions contemplated hereby.

     3.05 Governmental Authorization. Except for the applicable requirements of
the HSR Act and compliance with applicable federal and state securities laws,
such Seller is not required to submit or obtain any notice, consent, approval,
authorization, report or other filing with any governmental or regulatory
authority in connection with the execution, delivery or performance by such
Seller of this Agreement, the Transaction Documents or the consummation of the
transactions contemplated hereby or thereby.

     3.06 Ownership of Capital Stock. As of the date hereof, each Seller is the
record owner of, beneficially owns and has good title to the Shares and Warrants
set forth opposite such Seller's name on Section 4.04(a) of the Disclosure
Schedules, which Shares and Warrants constitute all of the Shares and Warrants
owned beneficially or held of record by such Seller. At Closing, and upon
termination of those agreements listed on Section 4.04 of the Disclosure
Schedules, such Seller shall transfer to, and Buyer will acquire, good title to
such Seller's Shares, free and clear of any liens or other restrictions on
transfer, other than applicable federal and state securities law restrictions
and those liens and restrictions listed on Section 3.06 of the Disclosure
Schedules which are being released at the Closing.

     3.07 Litigation. There are no actions, suits or proceedings pending or, to
Seller's knowledge, threatened against or affecting such Seller at law or in
equity, or before or by any federal, state, municipal or other governmental
department, commission, board, bureau or agency, domestic or foreign, which
would adversely affect such Seller's performance under this Agreement, the
Transaction Documents or the consummation of the transactions contemplated
hereby or thereby.

     3.08 Brokers Fees. Such Seller has no liability or obligation to pay any
fees or commissions to any broker, finder or agent with respect to the
transactions contemplated by this Agreement.

                                   ARTICLE IV

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

          Except as disclosed in the Disclosure Schedules (including, without
limitation, any schedule update), the Company represents and warrants to Buyer
as of the date hereof and as of the Closing Date, as follows:

     4.01 Organization and Corporate Power. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, and the Company has all


                                       11

<PAGE>

requisite corporate power to own and operate its properties and to carry on its
businesses as now conducted. The Company is duly qualified to do business and is
in good standing in every jurisdiction in which its ownership of property or the
conduct of businesses as now conducted requires it to qualify, except where the
failure to be so qualified or in good standing would not, individually or in the
aggregate, have a Material Adverse Effect. The Company has made available to
Buyer true and complete copies of the organizational documents of the Company as
currently in effect.

     4.02 Subsidiaries. Except as set forth on Section 4.02 of the Disclosure
Schedules, neither the Company nor any of its Subsidiaries owns any stock,
partnership interest, joint venture interest or other equity ownership interest
in any other Person. Each Subsidiary of the Company is wholly owned by the
Company or another Subsidiary of the Company as indicated on Section 4.02 of the
Disclosure Schedules. Each Subsidiary of the Company identified on Section 4.02
of the Disclosure Schedules (i) is validly existing and in good standing under
the laws of the jurisdiction of its incorporation, (ii) has all requisite
corporate power and authority to carry on its businesses as now conducted and
(iii) is duly qualified to do business and is in good standing in every
jurisdiction in which its ownership of property or the conduct of its business
as now conducted requires it to qualify, except, in each case, where the failure
to be so qualified or in good standing would not, individually or in the
aggregate, have a Material Adverse Effect. The Company has made available to
Buyer true and complete copies of the organizational documents of each of its
Subsidiaries as currently in effect.

     4.03 Authorization; Valid and Binding Agreement; No Breach.

          (a) This Agreement and the other Transaction Documents have been duly
authorized, executed and delivered by the Company. Assuming that this Agreement
and the other Transaction Documents are the valid and binding obligation of each
of the other parties thereto, this Agreement and the other Transaction Documents
constitute a valid and binding obligation of the Company, enforceable in
accordance with its terms, except as enforceability may be limited by bankruptcy
laws, other similar laws affecting creditors' rights and general principles of
equity affecting the availability of specific performance and other equitable
remedies.

          (b) Except (i) as set forth on Section 4.03(b) of the Disclosure
Schedules, and (ii) for the applicable requirements of the HSR Act, the
execution, delivery and performance of this Agreement and the Transaction
Documents by the Company and each Subsidiary and the consummation of the
transactions contemplated hereby or thereby do not and will not (A) result in
any breach of or require any authorization, consent or approval by or notice to
any court, other governmental body or Person under the provisions of the
Company's or any of its Subsidiaries' certificate or articles of incorporation
or bylaws or equivalent organizational documents, or (B) result in any material
breach of, constitute a material default under, result in a material violation
of, result in the creation of any material lien, security interest, charge or
encumbrance (other than a Permitted Lien) upon any asset of the Company or any
of its Subsidiaries, or require any authorization, consent or approval by or
notice to any court, other governmental body or Person (1) under any indenture,
mortgage, lease or loan agreement or any Significant Contract to which the
Company or any of its Subsidiaries is bound, (2) under any law, statute or
regulation or (3) under any order, judgment or decree to which the Company or
any of its Subsidiaries is subject.

     4.04 Capital Stock.

           (a) Section 4.04(a) of the Disclosure Schedules sets forth, as of the
date of this Agreement, (i) the authorized and issued and outstanding shares of
each class of capital stock of the Company and its Subsidiaries, the name of
each record holder of such shares of the Company's capital


                                       12

<PAGE>

stock, and the number of shares of such class of the Company's or its
Subsidiaries' capital stock held by each such record holder and (ii) all
outstanding Warrants issued by the Company, the name of each record holder of
such Warrants and the class and number of shares of capital stock issuable upon
exercise of each such Warrant.

          (b) All outstanding Shares of the Company and all outstanding shares
of capital stock of each of its Subsidiaries have been duly authorized and
validly issued and are fully paid and non-assessable. Except for the Warrants
which will be cancelled in connection with the Closing and except as set forth
on Section 4.04(a) or 4.04(b)(i) of the Disclosure Schedules, there are no
outstanding (i) shares of capital stock of the Company or any of its
Subsidiaries, (ii) securities of the Company, whether debt or equity, or any of
its Subsidiaries convertible into or exchangeable for shares of capital stock of
the Company or any of its Subsidiaries or (iii) options, warrants or other
rights to acquire from the Company or any of its Subsidiaries, or other
obligations of the Company or any of its Subsidiaries to issue, any capital
stock or securities convertible into or exchangeable for capital stock of the
Company or any of its Subsidiaries (the items in clauses 4.04(b)(i), 4.04(b)(ii)
and 4.04(b)(iii) being referred to collectively as the "Company Securities").
There are no outstanding obligations of the Company or any of its Subsidiaries
to repurchase, redeem or otherwise acquire or retire for value any Company
Securities.

     4.05 Financial Statements.

          (a) The Company has furnished Buyer with true and complete copies of
its (i) unaudited consolidated balance sheet as of July 1, 2006 (the "Latest
Balance Sheet"), and the related consolidated statement of income and cash flow
of the Company and its Subsidiaries for the six month period then ended (the
"Unaudited Financial Statements") and (ii) the audited consolidated balance
sheet as of December 31, 2005, and the related consolidated statement of income
and cash flow of the Company and its Subsidiaries for the fiscal year ended
December 31, 2005 (the "Audited Financial Statements" and, together with the
Unaudited Financial Statements, the "Financial Statements"). Except as set forth
on Section 4.05 of the Disclosure Schedules, such Financial Statements have been
based upon the information concerning the Company and its Subsidiaries contained
in the Company's and its Subsidiaries' books and records, and present fairly and
accurately in all material respects the financial condition and results of
operations of the Company and its Subsidiaries (taken as a whole) as of the
times and for the periods referred to therein and have been prepared in
accordance with GAAP consistently applied (which is subject to such exceptions
set forth on Schedule 4.05 of the Disclosure Schedules).

          (b) To the Company's knowledge, neither the Company nor any of its
Subsidiaries is subject to any liability (other than any liability, together
with the liabilities arising from all related items or events, as would not
result in a Loss to the Company and its Subsidiaries in excess of $250,000)
arising out of events, transactions or actions or inactions arising prior to the
date hereof, except (i) liabilities under leases, licenses, contracts and
agreements which are not required to be disclosed on the Disclosure Schedules
arising out of or related to the transactions contemplated hereby, (ii)
liabilities reflected on the Latest Balance Sheet or liabilities which have
arisen after the date of the Latest Balance Sheet in the ordinary course of
business consistent with past practices and (iv) liabilities otherwise disclosed
on the Disclosure Schedules (including, without limitation, liabilities under
leases, licenses, contracts and agreements described in the Disclosure
Schedules). Notwithstanding the foregoing, this representation and warranty will
not apply to (and will exclude) any liability arising out of or related to
facts, events, transactions, actions or inactions, which are covered by,
addressed in or are of the same nature or subject matter as any liability which
is covered by or addressed in another representation or warranty set forth in
this Article IV. (By way of example, as to the foregoing sentence, pending and
threatened litigation is covered in the representations and warranties in
Section 4.11 and therefore all pending and threatened


                                        13

<PAGE>

litigation (regardless of whether such litigation is covered by the
representation and warranties in Section 4.11) is covered by Section 4.11 for
the purposes of the foregoing sentence and not this Section.)

     4.06 Absence of Certain Developments. Since the date of the Latest Balance
Sheet, there has not been any Material Adverse Effect. Except as set forth on
Section 4.06 of the Disclosure Schedules or except as contemplated by this
Agreement, since the date of the Latest Balance Sheet, neither the Company nor
any Subsidiary of the Company has:

          (a) mortgaged, pledged or subjected to any material lien, charge or
other encumbrance, any portion of its assets, except Permitted Liens;

          (b) sold, assigned or transferred any material portion of its tangible
assets, except in the ordinary course of business;

          (c) sold, assigned or transferred any Intellectual Property, except in
the ordinary course of business;

          (d) forgiven or cancelled any material Indebtedness or suffered any
material extraordinary losses (whether or not covered by insurance), or
condemnation, taking or other similar proceedings, or waived any claims or
rights of material value (including any Indebtedness owed by any stockholder,
officer, director, employee or affiliate of the Company or any Subsidiary);

          (e) redeemed or repurchased, directly or indirectly, any shares of
capital stock or declared, set aside or paid any dividends or made any other
distributions (whether in cash or in kind) with respect to any shares of its
capital stock;

          (f) issued, sold or transferred any of its capital stock, securities
convertible into its capital stock or warrants, options or other rights to
acquire its capital stock;

          (g) made any capital expenditures or commitments therefore in excess
of $250,000, except in the ordinary course of business;

          (h) changed any of its accounting policies, practices or procedures,
including internal control procedures, except those changes required by GAAP;

          (i) amended or modified its charter or bylaws;

          (j) increased the salary of any senior management-level employee of
the Company or any of its Subsidiaries (i.e., Vice President or above) or
entered into any agreement with such senior management-level employee, except
for increases in salary in the ordinary course of business;

          (k) taken any action or entered into or agreed to enter into any
transaction, agreement or commitment which is reasonably expected to result in
more than $250,000 of liability to the Company, other than in the ordinary
course of business; or

          (l) agreed in writing or, to the Company's knowledge, orally, to take
any of the foregoing actions.


                                        14

<PAGE>

     4.07 Title to Properties.

          (a) Except as set forth on Section 4.07(a) of the Disclosure
Schedules, the Company and its Subsidiaries own good title to, or hold pursuant
to valid and enforceable leases, all of the personal property shown to be owned
by them on the Latest Balance Sheet (except for such personal property sold or
disposed of subsequent to the date thereof in the ordinary course of business),
free and clear of all liens, security interests and other encumbrances, except
for Permitted Liens.

          (b) Section 4.07(b)(i) of the Disclosure Schedules sets forth the
addresses of all land, together with all buildings, structures, improvements and
fixtures located thereon, and all easements and other rights and interests
appurtenant thereto, owned by the Company or its Subsidiaries (collectively, the
"Owned Real Property"). With respect to each parcel of Owned Real Property,
except as set forth in Section 4.07(b)(ii) of the Disclosure Schedules: (i) the
Company or one of its Subsidiaries has fee simple title thereto, free and clear
of all liens, security interests and other encumbrances, except Permitted Liens;
(ii) neither the Company nor any of its Subsidiaries has leased to any Person
the right to use or occupy such Owned Real Property or any portion thereof;
(iii) there are no outstanding options, rights of first offer or rights of first
refusal to purchase such Owned Real Property or any portion thereof; (iv) the
Company has received no written notice from any governmental agency of any
violation of any statute, law, ordinance, deed restriction, rule or regulation
with respect to the Owned Real Property; and (v) there is no pending or, to the
Company's knowledge, threatened litigation, condemnation proceeding, or
annexation proceeding affecting any of the Owned Real Property, and there are no
governmental assessments against any of the Owned Real Property other than those
that constitute Permitted Liens.

          (c) The real property demised by the leases described on Section
4.07(c)(i) of the Disclosure Schedules (the "Leased Real Property") constitutes
all of the material real property leased by the Company and its Subsidiaries.
Except as set forth on Section 4.07(c)(ii) of the Disclosure Schedules, the
leases demising the Leased Real Property are in full force and effect, subject
to proper authorization and execution of such lease by the other party and the
limitations of bankruptcy laws, other similar laws affecting creditors' rights
and general principles of equity affecting the availability of specific
performance and other equitable remedies. The Company has made available to
Buyer true and complete copies of the leases demising the Leased Real Property.
Neither the Company nor any of its Subsidiaries is in payment default under any
such leases or any other default under any of such leases that would permit the
landlord to terminate such lease.

     4.08 Tax Matters.

          (a) Each of the Company and its Subsidiaries has filed all federal
Income Tax Returns and all other material Tax Returns that it was required to
file. All such Tax Returns were correct and complete in all material respects.
All Taxes due and owing by the Company or any of its Subsidiaries (whether or
not shown on any Tax Return) have been paid. Except as set forth on Section
4.08(a) of the Disclosure Schedules, neither the Company nor any of its
Subsidiaries currently is the beneficiary of any extension of time within which
to file any Tax Return. There are no liens for Taxes (other than Taxes not yet
due and payable) upon any of the assets of the Company or any of its
Subsidiaries.

          (b) Except as set forth on Section 4.08(b) of the Disclosure
Schedules, there is no material dispute or claim concerning any Tax liability of
the Company or any of its Subsidiaries either (i) claimed or raised by any Tax
authority in writing or (ii) as to which any of Sellers or any of the directors
and officers of the Company and its Subsidiaries has knowledge based upon
personal contact with any agent of such authority.


                                       15

<PAGE>

          (c) Section 4.08(c) of the Disclosure Schedules lists (i) all federal,
state, local, and foreign Income Tax Returns filed with respect to the Company
or any of its Subsidiaries and (ii) all states in which sale or use Tax Returns
were filed with respect to the Company or any of its Subsidiaries, in each case
for taxable periods ended on or after December 31, 2003, and (iii) indicates
those Tax Returns that have been audited, and indicates those Tax Returns that
currently are the subject of audit. Sellers have delivered to Buyer true and
complete copies of all federal Income Tax Returns, examination reports, and
statements of deficiencies assessed against, or agreed to by the Company or any
of its Subsidiaries since November 23, 2004. Neither the Company nor any of its
Subsidiaries has waived any statute of limitations in respect of Taxes or agreed
to any extension of time with respect to a Tax assessment or deficiency.

          (d) Neither the Company nor any of its Subsidiaries is a party to or
bound by any tax allocation or sharing agreement. Neither the Company nor any of
its Subsidiaries (i) has been a member of an Affiliated Group filing a
consolidated federal Income Tax Return (other than a group the common parent of
which was the Company or Meridian Rail Acquisition Corp.) or (ii) has any
liability for the Taxes of any Person (other than the Company or any of its
Subsidiaries) under Reg. Section 1.1502-6 (or any similar provision of state,
local, or foreign law), as a transferee or successor, by contract, or otherwise.

          (e) Except as set forth in Section 4.08(e) of the Disclosure
Schedules, neither the Company nor any of its Subsidiaries will be required to
include any item of income in, or exclude any item of deduction from, taxable
income for any taxable period (or portion thereof) ending after the Closing Date
as a result of any:

               (i) change in method of accounting for a taxable period ending on
     or prior to the Closing Date;

               (ii) "closing agreement" as described in Internal Revenue Code
     Section 7121 (or any corresponding or similar provision of state, local or
     foreign income Tax law) executed on or prior to the Closing Date;

               (iii) intercompany transactions or any excess loss account
     described in Treasury Regulations under Internal Revenue Code Section 1502
     (or any corresponding or similar provision of state, local or foreign
     income Tax law);

               (iv) installment sale or open transaction disposition made on or
     prior to the Closing Date; or

               (v) prepaid amount received on or prior to the Closing Date.

          (f) Neither the Company nor any of its Subsidiaries has distributed
stock of another Person, or has had its stock distributed by another Person, in
a transaction that was purported or intended to be governed in whole or in part
by Internal Revenue Code Section 355 or Internal Revenue Code Section 361.

          (g) Any claim of breach of representation or warranty regarding Taxes
shall be made only under this Section 4.08 and shall not be made under any other
representation or warranty contained in this Agreement. For the avoidance of
doubt, (i) this Section 4.08(g) shall not apply to the covenants set forth under
Section 11.03 and (ii) representations and warranties regarding ERISA will not
be considered a representation or warranty regarding Taxes for the purposes of
this Section 4.08(g) and such


                                       16

<PAGE>

representations and warranties regarding ERISA shall be made only in Section
4.13 below and not this Section 4.08.

     4.09 Contracts and Commitments.

          (a) Except as set forth on Section 4.09(a) of the Disclosure
Schedules, neither the Company nor any of its Subsidiaries is party to any
written: (i) collective bargaining agreement or contract with any labor union;
(ii) pension, profit sharing, retirement, deferred compensation plan or other
material bonus plan, other than as described in Section 4.13(a) of the
Disclosure Schedules relating thereto; (iii) agreement for the employment of any
officer, individual employee or other individual on a full-time or consulting
basis with annual payments in excess of $100,000 which is not terminable on 60
or fewer days notice by the Company or any Subsidiary without liability for any
penalty or severance payment greater than $30,000; (iv) loan agreement or
indenture relating to Indebtedness; (v) stockholders agreement or other
agreement among the Company's stockholders governing voting of the Company's
equity securities; (vi) lease or agreement under which it is lessee of, or holds
or operates any personal property owned by any other party, for which the annual
rental exceeds $250,000 and which is not terminable on 60 or fewer days notice
by the Company or any Subsidiary without liability for any penalty greater than
$30,000; (vii) lease or agreement under which it is lessor of or permits any
third party to hold or operate any personal property, for which the annual
rental exceeds $250,000 and which is not terminable on 60 or fewer days notice
by the Company or any Subsidiary without liability for any penalty greater than
$30,000; (viii) contract or group of related contracts with the same party for
the purchase of products or services by the Company or any of its Subsidiaries
with such products and services having a selling price in excess of $250,000 and
which is not terminable on 60 or fewer days notice by the Company or any
Subsidiary without liability for any penalty greater than $30,000; (ix) contract
or group of related contracts with the same party for the sale of products or
services by the Company or any of its Subsidiaries with such products and
services having a selling price in excess of $250,000 and which is not
terminable on 60 or fewer days notice by the Company or any Subsidiary without
liability for any penalty greater than $30,000; (x) contract or agreement
containing covenants limiting the freedom of the Company or any Subsidiary of
the Company to compete in any line of business or with any Person which is not
terminable on 60 or fewer days notice by the Company or any Subsidiary without
liability for any penalty greater than $30,000; (xi) guarantees, letters of
credit, performance bonds and/or sureties issued by or on behalf of the Company
or any Subsidiary in connection with any customer contracts, proposals or
otherwise; or (xii) contract involving any commitment of suretyship, guaranty or
indemnification by the Company or any Subsidiary with respect to any side frames
or bolsters which could reasonably be expected to require payments by the
Company or any Subsidiary in excess of $100,000.

          (b) The Company has made available to Buyer true and complete copies
of all contracts listed on Section 4.09(a) of the Disclosure Schedules (the
"Significant Contracts"). With respect to the Significant Contracts, except as
set forth on Section 4.09(b) of the Disclosure Schedules, (i) neither the
Company nor any of its Subsidiaries is in default under any such contract, and
(ii) to the Company's knowledge, no other party thereto, is in default under any
such contract, except, in each case, where such default would not, individually
or in the aggregate, have a Material Adverse Effect. Each Significant Contract
is a valid, binding obligation of the Company or its Subsidiaries and
enforceable in accordance with its terms, except as to the effect, if any, of
(a) applicable bankruptcy and other similar laws affecting the rights of
creditors generally and (b) rules of law governing specific performance,
equitable relief and other equitable remedies. To the knowledge of the Company,
neither the Company nor any Subsidiary has received written notice of alleged
nonperformance, violation of or other noncompliance with respect to its
obligations under any of the Significant Contracts which alleged nonperformance,
violation or other


                                       17

<PAGE>

noncompliance is currently unresolved, nor any written notice that is currently
unresolved that any of the Significant Contracts may be totally or partially
terminated or suspended by any other party thereto.

          (c) Section 4.09(c)(i) of the Disclosure Schedules contains a true and
complete list setting forth the ten largest suppliers (the "Major Suppliers")
and the ten largest customers (excluding scrap purchasers and intercompany
purchases) (the "Major Customers") of the Company or any Subsidiary, by dollar
amount for the six-month period covered by the Unaudited Financial Statements.
Since the Latest Balance Sheet, to the knowledge of the Company, no Major
Customer has cancelled or otherwise materially modified its agreement with the
Company or any Subsidiary in a manner adverse to the Company or any Subsidiary.
Except as set forth in Section 4.09(c)(ii) of the Disclosure Schedules, since
the Latest Balance Sheet, to the knowledge of the Company, no Major Supplier has
cancelled or otherwise materially modified its agreement with the Company or any
Subsidiary in a manner adverse to the Company or any Subsidiary.

     4.10 Intellectual Property. Section 4.10(a) of the Disclosure Schedules
contains a list of all of the material registered Intellectual Property owned by
the Company or any of its Subsidiaries and used in the conduct of the businesses
of the Company and its Subsidiaries. Except as set forth on Section 4.10(b) of
the Disclosure Schedules or as would not, individually or in the aggregate, have
a Material Adverse Effect: (i) the Company or one of its Subsidiaries owns and
possesses all right, title and interest in and to, or possesses the valid and
enforceable right to use, the Intellectual Property used in the conduct of the
businesses of the Company and its Subsidiaries; (ii) since November 23, 2004,
and to the knowledge of the Company since January 1, 2003, neither the Company
nor any of its Subsidiaries has received any written notices of infringement or
misappropriation from any third party with respect to the Company or any
Subsidiary's use of any Intellectual Property; (iii) to the Company's knowledge,
no third party is infringing or misappropriating any registered Intellectual
Property owned by the Company or any of its Subsidiaries, and (iv) to the
Company's knowledge, neither the Company nor any of its Subsidiaries is
infringing any registered Intellectual Property owned by a third party.

     4.11 Litigation. Except as set forth on Section 4.11(a) of the Disclosure
Schedules, there are no actions, suits or proceedings pending or, to the
Company's knowledge, threatened against the Company or any of its Subsidiaries,
at law or in equity, or before or by any federal, state, municipal or other
governmental department, commission, board, bureau or agency, domestic or
foreign, nor are there any that questions the validity of this Agreement, the
Transaction Documents or any action taken or to be taken by the Company or any
Subsidiary pursuant to this Agreement, the Transaction Documents or in
connection with the transactions contemplated hereby or thereby. Except as set
forth on Section 4.11(b) of the Disclosure Schedules, neither the Company nor
any of its Subsidiaries is subject to any outstanding judgment, order or decree
of any court or governmental body. Except as set forth on Section 4.11(c) of the
Disclosure Schedules, to the Company's knowledge, since November 23, 2004, there
have been no claims made, or any written threat of a claim received, against the
Company or any Subsidiary for liability arising out of the production or sale of
side frames or bolsters.

     4.12 Governmental Consents, etc. Except as set forth on Section 4.12 of the
Disclosure Schedules, and except for the applicable requirements of the HSR Act,
no material permit, consent, approval or authorization of, or declaration to or
filing with, any governmental or regulatory authority is required in connection
with any of the execution, delivery or performance of this Agreement or the
Transaction Documents by the Company or the consummation by the Company of the
transactions contemplated hereby or thereby.


                                       18

<PAGE>

     4.13 Employee Benefit Plans.

          (a) Section 4.13(a) of the Disclosure Schedules contains a true and
complete list of (i) all employee benefit plans (within the meaning of Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA")) and (ii) all other material bonus, stock option, stock purchase,
restricted stock, incentive, deferred compensation, retiree medical and life
insurance, supplemental retirement, severance and other material benefit plans,
programs and arrangements, and all material retention, termination, severance or
other similar contracts or agreements maintained, contributed to or sponsored by
the Company or any Subsidiary for the benefit of any current or former employee,
officer or director of the Company or any Subsidiary (collectively, excluding
any Multiemployer Plan, the "Plans"). The Company and its Subsidiaries have
previously made available to Buyer a true and complete copy of each Plan or
summary Plan (or, in the case of any unwritten Plan, a description), as
currently in effect, and a true and complete copy of each of the following
documents, to the extent applicable, prepared in connection with each such Plan:
(A) a copy of each trust or other funding arrangement, (B) the three most
recently filed Internal Revenue Service Forms 5500, (C) the most recently
received Internal Revenue Service prototype opinion letter, and (D) the most
recently prepared actuarial report. Neither the Company nor any Subsidiary has
communicated to employees any intent to or has expressly or impliedly committed
to modify, change or terminate any Plan, other than with respect to a
modification, change or termination required to bring the Plan into compliance
with applicable law. Each Plan that is intended to be qualified under Section
401(a) and/or 401(k) or 501(c)(9) of the Internal Revenue Code of 1986, as
amended (the "Internal Revenue Code"), so qualifies, has received a favorable
prototype opinion letter from the Internal Revenue Service to such effect and
its trust is exempt from taxation under Section 501(a) of the Internal Revenue
Code. To the knowledge of the Company, except as set forth on Section 4.13(a) of
the Disclosure Schedules, no fact or event has occurred since the date of any
prototype opinion letter from the Internal Revenue Service which is reasonably
likely to affect adversely such favorable determination or such qualification or
to result in a filing under Rev. Proc. 2003-44 or any predecessor or successor
thereto that would be reasonably likely to result in material liability to the
Company. The Company and its Subsidiaries have timely paid all contributions,
premiums and expenses payable to or in respect of each Plan and workers'
compensation arrangement under the terms thereof and in accordance with
applicable law, including ERISA and the Internal Revenue Code, and to the extent
any such contributions, premiums or expenses are not yet due, the liability
therefor has been properly and adequately accrued on the Financial Statements in
accordance with GAAP.

          (b) None of the Plans (i) is a Multiemployer Plan, or a pension plan
within the meaning of Section 4001(a)(15) of ERISA, (ii) is subject to Section
302 or Title IV of ERISA or Section 412 of the Internal Revenue Code, or (iii)
except as set forth on Section 4.13(b) of the Disclosure Schedules, provides or
promises to provide retiree medical or life insurance benefits, other than to
the extent required by Section 4980B(f) of the Internal Revenue Code, and
Sections 601 through 609 of ERISA or other similar laws.

          (c) Except as set forth on Section 4.13(c) of the Disclosure
Schedules, with respect to each Plan, neither the Company, any Subsidiary nor
any ERISA Affiliate is currently liable for any material Tax, including, without
limitation, any material Tax under Section 4971, 4972, 4975, 4976, 4979, 4980 or
4980B of the Internal Revenue Code, and, to the knowledge of the Company, no
fact or event exists which could reasonably be expected to give rise to any such
material liability. Neither the Company, any Subsidiary nor any ERISA Affiliate
has incurred any material liability (which will not be satisfied prior to the
Closing) under, arising out of or by operation of Title IV of ERISA, including,
without limitation, any liability in connection with the termination or
reorganization of any employee pension benefit plan subject to Title IV of
ERISA. To the knowledge of the Company, no fact or event


                                       19

<PAGE>

exists which could reasonably be expected to give rise to any such material
liability. "ERISA Affiliate" is any trade or business whether or not
incorporated, which together with the Company would be deemed to be a "single
employer" within the meaning of Section 4001(b) of ERISA or Section 414 of the
Internal Revenue Code.

          (d) No Plan subject to a funding requirement has been terminated at a
time when such Plan was not sufficiently funded.

          (e) Except as set forth on Section 4.13(e) of the Disclosure
Schedules, and except as would not, individually or in the aggregate, have a
Material Adverse Effect, each Plan has been operated in compliance with its
terms and applicable laws, including, without limitation, ERISA and the Internal
Revenue Code.

          (f) There are no actions, suits or claims (other than routine claims
for benefits in the ordinary course) pending or, to the knowledge of the
Company, threatened with respect to any Plan. With respect to the Plans, no
Plan, the Company or any Subsidiary is under audit or, to the knowledge of the
Company, investigation by the Internal Revenue Service, the U.S. Department of
Labor, the Pension Benefit Guaranty Corporation or any other federal or state
governmental agency, nor is any such audit or investigation pending or, to the
knowledge of the Company, threatened.

          (g) Except as set forth on Section 4.13(g) of the Disclosure
Schedules, neither the execution and delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, either alone or in
combination with another event (whether contingent or otherwise) will (i)
entitle any current or former employee, consultant or director of the Company or
any Subsidiary to any increased or modified benefit or payment, including any
bonus payments, severance or change in control benefits; (ii) increase the
amount of compensation due to any such employee, consultant or director; (iii)
accelerate the vesting, payment or funding of any compensation, stock-based
benefit, incentive or other benefit; or (iv) result in any "parachute payment"
under Section 280G of the Internal Revenue Code (whether or not such payment is
considered to be reasonable compensation for services rendered).

          (h) The Company and its Subsidiaries has workers compensation
insurance from a bona fide third party insurance carrier in amounts sufficient
to satisfy applicable workers compensation insurance requirements in the
jurisdictions where the Company and its Subsidiaries conduct business.

          (i) Except as set forth on Section 4.13(i) of the Disclosure
Schedules, neither the Company nor any Subsidiary contributes to, nor has any
liability with respect to, any Multiemployer Plan.

     4.14 Insurance. Section 4.14(a) of the Disclosure Schedules lists each
material insurance policy maintained by the Company and its Subsidiaries
identifying the name of the insurance carrier, type of coverage, policy limits
and deductibles for each such policy. All of such insurance policies are in full
force and effect, and to the Company's knowledge, neither the Company nor any
Subsidiary of the Company is in default with respect to its obligations under
any of such insurance policies, except where such default would not,
individually or in the aggregate, have a Material Adverse Effect. Except as set
forth in Section 4.14(b) of the Disclosure Schedules, none of such insurance
policies will terminate or lapse by reason of any of the transactions
contemplated by this Agreement. All premiums covering all periods up to and
including the Closing have been paid, and to the knowledge of the Company, no
notice of cancellation or termination has been received with respect to any such
policy or binder. Since November 23, 2004, neither the Company nor any
Subsidiary has been refused any insurance with respect to its assets or
operations. True and complete copies of all policies have been made available to
Buyer.


                                        20

<PAGE>

     4.15 Compliance with Laws. Except as set forth on Section 4.15 of the
Disclosure Schedules, the Company and its Subsidiaries are in compliance with
all applicable laws and regulations of foreign, federal, state, provincial and
local governments and all agencies thereof which affect the business, operations
or Owned Real Property or Leased Real Property of the Company or its
Subsidiaries and to which the Company or its Subsidiaries may be subject, and no
claim has been filed or commenced against any of them alleging any failure to so
comply, except with respect to compliance with where the failure to comply would
not, individually or in the aggregate, have a Material Adverse Effect; provided,
however, that with respect to compliance with applicable laws regarding bribes,
kickbacks, any other illegal payments to obtain or retain business or to receive
favorable treatment with regard to business, illegal contributions made to any
political party, political candidate or holder of governmental office and
compliance with the United States Corrupt Foreign Practices Act or any other
similar laws, statute, rule or regulation of any country, this representation
shall not be subject to the Material Adverse Effect qualifier.

      4.16 Environmental, Health and Safety Matters. Except as set forth on
Section 4.16 of the Disclosure Schedules:

          (a) The Company and each Subsidiary are, and since November 23, 2004
have been, in material compliance with all applicable Environmental
Requirements.

          (b) Without limiting the generality of the foregoing, the Company and
each Subsidiary have obtained all permits, licenses and other authorizations
required under applicable Environmental Requirements ("Environmental Permits"),
and are in material compliance with such permits, licenses and authorizations. A
list of all material Environmental Permits owned or possessed by the Company or
its Subsidiaries is set forth on Section 4.16 of the Disclosure Schedules.

          (c) Neither the Company nor any of its Subsidiaries has since November
23, 2004, received any written notice from any government entity, that alleges
that any of them is in material violation of Environmental Requirements or OSHA
rules or regulations, or has any material liability arising under applicable
Environmental Requirements or OSHA rules or regulations, including any material
investigatory, remedial or corrective obligation, relating to the Company, any
Subsidiary or their facilities, the subject of which is unresolved.

          (d) To the knowledge of the Company, none of the following exists at
or under the Real Property: (1) underground storage tanks in violation of
Environmental Requirements, (2) friable or potentially friable
asbestos-containing material requiring abatement under Environmental
Requirements, (3) materials or equipment containing polychlorinated biphenyls in
violation of Environmental Requirements, or (4) unpermitted landfills, surface
impoundments, or disposal areas in violation of Environmental Requirements.

          (e) Since November 23, 2004, neither the Company nor any Subsidiary
has treated, stored, disposed of, arranged for or permitted the disposal of,
transported, handled, or released any hazardous substance in material violation
of any Environmental Requirements.

          (f) Since November 23, 2004, neither the Company nor any Subsidiary
has materially violated any Environmental Requirements at any real property
previously owned or operated by the Company or any Subsidiary.

          (g) The Company and each Subsidiary possess all material manifests,
reports, policies, manuals, safety data sheets, hazard communications program
documents and all other material


                                       21

<PAGE>

records they are required to retain pursuant to any Environmental Requirements,
in the manner so required in all material respects.

          (h) Neither the Company nor any of its Subsidiaries is in material
violation of any applicable OSHA rules and regulations.

          (i) This Section 4.16 constitutes the sole and exclusive
representations and warranties of the Company with respect to any environmental,
health and safety matters, including without limitation any arising under
Environmental Requirements and OSHA.

          (j) To the Company's knowledge, the environmental reports (the
"Vanguard Reports") delivered to the Company by Vanguard Environmental, Inc.
("Vanguard") (in 2005 and/or 2006) do not disclose any liability which would be
required to be disclosed on Section 4.16 of the Disclosure Schedules which is
not otherwise disclosed on such Section 4.16 of the Disclosure Schedule (or
otherwise set forth in any other environmental report listed thereon). The scope
of the Vanguard Reports do not contain a Phase II environmental investigation
(or the results of any soil or groundwater sampling done by Vanguard in
connection therewith).

     4.17 Affiliated Transactions. Except as set forth on Section 4.17 of the
Disclosure Schedules and except for payments to be made in connection with the
Closing to the extent reflected in the Closing Statement, no officer, director,
stockholder or Affiliate of any of them or an Affiliate of the Company or any
Subsidiary is a party to any agreement, contract, commitment or transaction with
the Company or any of its Subsidiaries or has any interest in any property used
by the Company or its Subsidiaries.

     4.18 Employees. Except as set forth on Section 4.18(a) of the Disclosure
Schedules, neither the Company nor any Subsidiary of the Company has experienced
any strike or material grievance, claim of unfair labor practices, or other
material collective bargaining dispute since November 23, 2004 that has not been
dismissed or settled. Except as set forth on Section 4.18(b) of the Disclosure
Schedules, to the Company's knowledge, no organizational effort is presently
being made or threatened by or on behalf of any labor union with respect to
employees of the Company or any of its Subsidiaries. Except as set forth on
Section 4.18(c) of the Disclosure Schedules, no collective bargaining agreements
are in effect with respect to the Company or any Subsidiary.

     4.19 Brokerage. Except as set forth on Section 4.19 of the Disclosure
Schedule, there are no claims for brokerage commissions, finders' fees or
similar compensation in connection with the transactions contemplated by this
Agreement based on any arrangement or agreement made by or on behalf of the
Company or any Subsidiary.

     4.20 Governmental Licenses and Permits. Section 4.20 of the Disclosure
Schedules contains a list of all permits (temporary or otherwise), licenses,
authorizations and approval of federal, foreign, state and local governmental
entities and zoning bodies (collectively, the "Licenses") owned or possessed by
the Company or its Subsidiaries all of which are currently valid and in full
force and effect and no other permits, licenses, authorizations and approval of
federal, foreign, state and local governmental entities and zoning bodies are
required in the conduct of their respective businesses and operations or used by
the Company and its Subsidiaries in the conduct of th


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