CONSULTING AGREEMENT
                                 BY AND BETWEEN
                           PORTEC RAIL PRODUCTS, INC.
                                       AND
                                 JOHN S. COOPER


     THIS CONSULTING  AGREEMENT (the "Agreement") is made as of January 1, 2008,
by and between  Portec Rail  Products,  Inc.  (the  "Company"),  a West Virginia
corporation, and John S. Cooper (the "Consultant").

     WHEREAS,  the Company has  requested the  Consultant to provide  consulting
services  for the  Company  for the term  and in the  manner  set  forth in this
Agreement; and

     WHEREAS,  Consultant  has agreed to  perform  consulting  services  for the
Company pursuant to the terms of this Agreement.

     NOW, THEREFORE,  in consideration of the mutual promises and covenants made
herein, the parties hereto hereby agree as follows:

1.   DEFINITIONS

     As used in this Agreement, the following terms have the following meanings.

     (a) "Beginning Date" means the date of this Agreement.

     (b) "Consulting Fee" has the meaning set forth in Section 2(c)(i).

     (c) "Consulting Services" has the meaning set forth in Section 2(a)(ii).

     (d) "Contract Term" has the meaning set forth in Section 2(b).

     (e) "Termination Date" means December 31, 2008.

2.   SERVICES, COVENANTS AND COMPENSATION

     (a) Corporate Opportunities; Services and Duties.

          (i)  Corporate  Opportunities.   Consultant  agrees  that  during  the
     Contract Term,  Consultant  shall not,  directly or  indirectly,  usurp any
     corporate  opportunity  of the Company or engage in any business that would
     detract  from  Consultant's  ability  to  apply  his  best  efforts  to the
     performance of his duties hereunder.

          (ii)  Consulting.  Subject  to  and  upon  the  terms  and  conditions
     contained  in this  Agreement,  (i) the  Company  hereby  agrees  to engage
     Consultant as an independent  contractor and (ii)  Consultant  agrees to be

<PAGE>

     engaged  by the  Company  for the  Contract  Term and to render  Consulting
     Services to the Company. The Consulting Services shall consist of providing
     strategic  and  operational  advice as requested at the  discretion  of the
     Company.

     (b) Contract Term. Consultant's engagement pursuant to this Agreement shall
commence as of the Beginning Date and shall terminate at 5:00 p.m., Pennsylvania
time, on the Termination Date (the "Contract Term").

     (c) Consideration.

          (i) Consulting  Fee. In  consideration  for the  Consulting  Services,
     Consultant   shall  be  paid   Thirty-Six   Thousand  and  00/100   Dollars
     ($36,000.00)  annually (the "Consulting  Fee") in twelve (12) equal monthly
     installments,  payable  on the 15th day of each month  during the  Contract
     Term.

          (ii) Bonus.  In  addition  to the  Consulting  Fee,  Consultant  shall
     participate in the Company's  annual bonus plan for executives and shall be
     eligible for incentive bonuses thereunder at the discretion of the Company.

          (iii) Expenses.  Company shall reimburse Consultant for all reasonable
     business  expenses  incurred by Consultant at the request of the Company in
     accordance with the Company's expense reimbursement policies.

          (iv) Consultant shall be entitled to receive normal and customary fees
     for his service on the Company's board of directors.

          (v) No Additional  Consideration.  It is understood by Consultant  and
     the Company that  Consultant  shall not be entitled to the provision of any
     benefits (e.g., medical, dental and disability insurance;  vacation; 401(k)
     contributions,  etc.) other than as specifically  set forth in this Section
     2.

3.   INDEPENDENT CONTRACTOR

     Nothing   herein  shall  be   construed  to  create  an   employee-employer
relationship  between the Company and  Consultant.  Consultant is an independent
contractor  and not an  employee of the  Company or any of its  subsidiaries  or
affiliates.  The  consideration  set  forth  in  Section  2  shall  be the  sole
consideration  due  Consultant  for  the  services  rendered  hereunder.  It  is
understood  that the Company  will not withhold any amounts for payment of taxes
from the  compensation  of Consultant  hereunder.  Consultant will not represent
himself to be, or hold himself out as an employee of the Company.

4.   MISCELLANEOUS

     (a)  Governing  Law.  This  Agreement  shall be governed by the laws of the
Commonwealth of Pennsylvania.

     (b) Severability.  If, for any reason, any provision of this Agreement,  or
any part of any provision, is held invalid, such invalidity shall not affect any

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other  provision  of this  Agreement or any part of such  provision  not held so
invalid, and each such other provision and part thereof shall to the full extent
consistent with law continue in full force and effect.

     (c) Entire  Agreement.  This  Agreement  contains the entire  understanding
between  the  parties  hereto and  supersedes  any prior  agreement  between the
Company and any  predecessor of the Company and  Consultant  with respect to the
subject matter hereof. This Agreement may not be changed or modified,  except by
an instrument in writing executed by the Consultant and the Company.

     (d) Headings.  The headings of sections and paragraphs  herein are included
solely  for  convenience  of  reference  and shall not  control  the  meaning or
interpretation of any of the provisions of this Agreement.

     (e)  Notices.  For the  purposes of this  Agreement,  notices and all other
communications  provided for in this Agreement  shall be in writing and shall be
deemed  to have been duly  given  when  delivered  or  mailed  by  certified  or
registered mail,  return receipt  requested,  postage prepaid,  addressed to the
respective addresses set forth below:

To the Company:                            President and Chief Executive Officer
                                           Portec Rail Products, Inc.
                                           900 Old Freeport Road
                                           Pittsburgh, PA  15238

With a copy to:                            Luse Gorman Pomerenk & Schick, P.C.
                                           5335 Wisconsin Avenue NW, Suite 400
                                           Washington, D.C. 20015

To the Consultant:                         John S. Cooper
                                           216 1/2 Robin Hood Drive
                                           Irwin, PA  15642



                            [Signature Page Follows]


<PAGE>



ATTEST:                                    PORTEC RAIL PRODUCTS, INC.



/s/ John N. Pesarsick                      By:/s/ Richard J. Jarosinski
------------------------------------          ----------------------------------
Secretary                                  Richard J. Jarosinski
                                           President and Chief Executive Officer



WITNESS:                                   CONSULTANT:


/s/ Alicia M. Faderewski                   /s/ John S. Cooper
------------------------------------       -------------------------------------
                                           John S. Cooper