exv10w28



 







Exhibit 10.28




AMERICAN RAILCAR INDUSTRIES, INC.

2005 EQUITY INCENTIVE PLAN

NOTICE OF STOCK OPTION AWARD




          Unless otherwise defined herein, the terms defined in the 2005 Equity Incentive Plan shall
have the same defined meanings in this Notice of Stock Option Award and the attached Stock Option
Award Terms, which is incorporated herein by reference (together, the “Award Agreement”).




Participant
(the “Participant”)

«Name»

«Address»




Grant

The undersigned Participant has been granted an Option to purchase Common Stock of American Railcar
Industries, Inc. (the “Company”), subject to the terms and conditions of the Plan and this Award
Agreement, as follows:



	 	 	 	 	 	 	 
	Date of Grant

	 	«Grant_Date»
	 	Total Exercise Price
	 	$«Total_Exercise_Price»
	 
	 	 	 	 	 	 
	Type of Option

	 	oIncentive

Stock Option
	 	Total Number of
Shares Granted
	 	«Shares_Granted»
	 
	 	 	 	 	 	 
	 

	 	o Nonstatutory

Stock Option	 	Performance Criteria	 	«Yes, as provided below»
	 
	 	 	 	 	 	 
	Exercise Price per

Share

	 	$«Exercise_Price»
	 	Term/Expiration Date
	 	«Five years from Grant

Date»






Vesting Schedule:



This Option shall be exercisable, in whole or in part, according to the following vesting schedule:



	 	 	 
	Number of Months (or years) of	% of Grant (or # of Shares) Vested
	Service	 	 
	 
	 	 
	One year anniversary of Grant Date

	 	33% of Grant
	 
	 	 
	Two year anniversary of Grant Date

	 	66% of Grant
	 
	 	 
	Three year anniversary of Grant Date

	 	100% of Grant






 









 





Performance
Criteria [To be determined]



Vesting of this Option shall cease upon termination of Employment (the “Relationship”) of the
Participant with the Company.



	 	 	 
	Participant	 	American Railcar Industries, Inc.
	 
	 	 
	 

	 	 
	Signature

	 	By
	 
	 	 
	 

	 	 
	Print Name

	 	Title
	 
	 	 
	 
	 	 
	 
	 	 
	 
	 	 
	Residence Address
	 	 






 









 





AMERICAN RAILCAR INDUSTRIES, INC.

STOCK OPTION

AWARD TERMS





	1.	 	Grant of Option. The Committee hereby grants to the Participant named
in the Notice of Stock Option Grant an option (the “Option”) to purchase the number of
Shares set forth in the Notice of Stock Option Award, at the exercise price per Share
set forth in the Notice of Stock Option Grant (the “Exercise Price”), and subject to
the terms and conditions of the 2005 Equity Incentive Plan (the “Plan”), which is
incorporated herein by reference. In the event of a conflict between the terms and
conditions of the Plan and this Stock Option Award Agreement, the terms and conditions
of the Plan shall prevail.
	 
	 	 	If designated in the Notice of Stock Option Grant as an Incentive Stock Option
(“ISO”), this Option is intended to qualify as an Incentive Stock Option as defined
in Section 422 of the Code. Nevertheless, to the extent that it exceeds the $100,000
limitation rule of Code Section 422(d), this Option shall be treated as a
Nonstatutory Stock Option (“NSO”).





2. Exercise of Option.




	 	i.	 	Right to Exercise. This Option may be exercised during
its term in accordance with the Vesting Schedule set out in the Notice of Stock
Option Award and with the applicable provisions of the Plan and this Award
Agreement, including, without limitation, if the Participant is terminated for
Cause as described more fully in Section 9 of the Plan, the Option shall
immediately terminate.






	 	ii.	 	Method of Exercise. This Option shall be exercisable by
delivery of an exercise notice in the form attached as Exhibit A (the “Exercise
Notice”) which shall state the election to exercise the Option, the number of
Shares with respect to which the Option is being exercised (the “Exercised
Shares”), and such other representations and agreements as may be required by
the Company. The Exercise Notice shall be accompanied by payment of the
aggregate Exercise Price as to all Exercised Shares. This Option shall be
deemed to be exercised upon receipt by the Company of such fully executed
Exercise Notice accompanied by payment of the aggregate Exercise Price.





No Shares shall be issued pursuant to the exercise of an Option unless such issuance and
such exercise complies with applicable laws. Assuming such compliance, for income tax
purposes the Shares shall be considered transferred to the Participant on the date on which
the Option is exercised with respect to such Shares.



 









 








	3.	 	Termination. This Option shall be exercisable for three months after
Participant ceases to be an employee; provided, however, if the
Relationship is terminated by the Company for cause, the Option shall terminate
immediately. Upon Participant’s death or Disability, this Option may be exercised for
twelve months after the Relationship ceases. In no event may Participant exercise this
Option after the Term/Expiration Date as provided above.






	4.	 	Participant’s Representations. In the event the Shares have not been
registered under the Securities Act of 1933, as amended, (the “Securities Act”) at the
time this Option is exercised and as a condition of such exercise, the Participant
shall, if required by the Company, concurrently with the exercise of all or any portion
of this Option, deliver to the Company his or her investment representations as
requested by the Company.






	5.	 	Lock-Up Period. Participant hereby agrees that, if so requested by the
Company or any representative of the underwriters (the “Managing Underwriter”) in
connection with any registration of the offering of any securities of the Company under
the Securities Act, Participant shall not sell or otherwise transfer any Shares or
other securities of the Company during the 180-day period (or such other period as may
be requested in writing by the Managing Underwriter and agreed to in writing by the
Company) (the “Market Standoff Period”) following the effective date of a registration
statement of the Company filed under the Securities Act. The Company may impose
stop-transfer instructions with respect to securities subject to the foregoing
restrictions until the end of such Market Standoff Period.






	6.	 	Restrictions on Exercise. This Option may not be exercised until such
time as the Plan has been approved by the stockholders of the Company, or if the
issuance of such Shares upon such exercise or the method of payment of consideration
for such shares would constitute a violation of any applicable law.






	7.	 	Non-Transferability of Option. This Option may not be transferred in
any manner otherwise than by will or by the laws of descent or distribution and may be
exercised during the lifetime of Participant only by Participant. The terms of the
Plan and this Award Agreement shall be binding upon the executors, Committees, heirs,
successors and assigns of the Participant.






	8.	 	Term of Option. This Option may be exercised only within the Term set
out in the Notice of Stock Option Award which Term may not exceed five (5) years from
the Date of Grant, and may be exercised during such Term only in accordance with the
Plan and the terms of this Award Agreement.






	9.	 	Notice of Disqualifying Disposition of Incentive Stock Option Shares.
If this Option is an Incentive Stock Option, and if the Participant sells or otherwise
disposes of any of the Shares acquired pursuant to the Incentive Stock Option on or
before the later of (1) the date two years after the Date of Grant, or (2) the date one
year after the date of





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	 	 	exercise, the Participant shall immediately notify the Company in writing of such
disposition. The Participant agrees that the Participant may be subject to income
tax withholding by the Company on the compensation income recognized by the
Participant.
	 
	10.	 	Withholding. Pursuant to applicable federal, state, local or foreign
laws, the Company may be required to collect income or other taxes on the grant of this
Option, the exercise of this Option, the lapse of a restriction placed on this Option
or the Shares issued upon exercise of this Option, or at other times. The Company may
require, at such time as it considers appropriate, that the Participant pay the Company
the amount of any taxes which the Company may determine is required to be withheld or
collected, and the Participant shall comply with the requirement or demand of the
Company. In its discretion, the Company may withhold Shares to be received upon
exercise of this Option or offset against any amount owed by the Company to the
Participant, including compensation amounts, if in its sole discretion it deems this to
be an appropriate method for withholding or collecting taxes.






	11.	 	Entire Agreement; Governing Law. The Plan is incorporated herein by
reference. The Plan and this Award Agreement constitute the entire agreement of the
parties with respect to the subject matter hereof and supersede in their entirety all
prior undertakings and agreements of the Company and Participant with respect to the
subject matter hereof, and may not be modified (except as provided herein and in the
Plan) adversely to the Participant’s interest except by means of a writing signed by
the Company and Participant. This agreement is governed by the internal substantive
laws but not the choice of law rules of the State of Delaware.






	12.	 	No Guarantee of Continued Service. PARTICIPANT ACKNOWLEDGES AND AGREES
THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY
CONTINUING IN THE RELATIONSHIP AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING
ENGAGED, BEING GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). PARTICIPANT FURTHER
ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER
AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED
PROMISE OF CONTINUED EMPLOYMENT FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND
SHALL NOT INTERFERE IN ANY WAY WITH PARTICIPANT’S RIGHT OR THE COMPANY’S RIGHT TO
TERMINATE THE RELATIONSHIP AT ANY TIME, WITH OR WITHOUT CAUSE.





Participant acknowledges receipt of a copy of the Plan and represents that he or she is
familiar with the terms and provisions thereof, and hereby accepts this Option subject to
all of the terms and provisions thereof. Participant has reviewed the Plan and this Option
in their entirety, has had an opportunity to obtain the advice of counsel prior to executing
this



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Option and fully understands all provisions of the Option. Participant hereby agrees to
accept as binding, conclusive and final all decisions or interpretations of the Committee
upon any questions arising under the Plan or this Option. Participant further agrees to
notify the Company upon any change in the residence address indicated below.




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EXHIBIT A




2005 EQUITY INCENTIVE PLAN

EXERCISE NOTICE




American Railcar Industries, Inc.

100 Clark St.

St. Charles, MO 63301

Attention: President





	 	1.	 	Exercise of Option. Effective as of today, ____________, 200___, the
undersigned (“Participant”) hereby elects to exercise Participant’s option to purchase
___ shares of the Common Stock (the “Shares”) of American Railcar Industries,
Inc. (the “Company”) under and pursuant to the 2005 Equity Incentive Plan (the “Plan”)
and the Stock Option Award Agreement dated
____________, 200___ (the “Award
Agreement”).






	 	2.	 	Delivery of Payment. Purchaser herewith delivers to the Company the
full purchase price of the Shares, as set forth in the Award Agreement.






	 	3.	 	Representations of Participant. Participant acknowledges that
Participant has received, read and understood the Plan and the Award Agreement and
agrees to abide by and be bound by their terms and conditions.






	 	4.	 	Rights as Stockholder. Until the issuance of the Shares (as evidenced
by the appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company), no right to vote or receive dividends or any other rights as a
stockholder shall exist with respect to the Optioned Stock, notwithstanding the
exercise of the Option. The Shares shall be issued to the Participant as soon as
practicable after the Option is exercised. No adjustment shall be made for a dividend
or other right for which the record date is prior to the date of issuance except as
provided in Section 3(c) of the Plan.






	 	5.	 	Tax Consultation. Participant understands that Participant may suffer
adverse tax consequences as a result of Participant’s purchase or disposition of the
Shares. Participant represents that Participant has consulted with any tax consultants
Participant deems advisable in connection with the purchase or disposition of the
Shares and that Participant is not relying on the Company for any tax advice.





[Signatures appear on next page.]




 









 





	 	 	 
	Submitted by:	 	Accepted by:
	 
	 	 
	PARTICIPANT

	 	AMERICAN RAILCAR INDUSTRIES, INC.
	 
	 	 
	 

	 	 
	Signature

	 	By
	 
	 	 
	 

	 	 
	Print Name

	 	Title
	 
	 	 
	Address:

	 	Address:
	 
	 	 
	 


	 	100 Clark St.
	 


	 	St. Charles, MO 63301
	 


	 	Attention: President
	 
	 	 
	 

	 	 
	 

	 	Date Received







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