EX-10.29



 






Exhibit 10.29




AMERICAN RAILCAR INDUSTRIES, INC.




Executive Incentive Plan for Fiscal Year 2005




	 	 	 	 	 
	I.	 	PURPOSE
	 
	 	 	 	 
	 	 	The American Railcar Industries, Inc. Executive Incentive Plan has been established for
Fiscal Year 2005 for those Participants defined under Section III below.
	 
	 	 	 	 
	 	 	The purpose of this Plan is to provide additional compensation to Participants for their
contribution to the achievement of the objectives of the Company, encouraging an
stimulating superior performance by such personnel, and assisting in attracting and
retaining highly qualified key employees.
	 
	 	 	 	 
	II.	 	DEFINITIONS
	 
	 	 	 	 
	 

	 	A.
	 	Base Salary equals the base annual salary effective December 31st
for which the award is calculated.
	 
	 	 	 	 
	 

	 	B.
	 	Company means American Railcar Industries, Inc. and its subsidiaries and its
successors and assigns.
	 
	 	 	 	 
	 

	 	C.
	 	Fiscal Year means the Company’s Fiscal Year beginning January 1 and ending
the last day of December.
	 
	 	 	 	 
	 

	 	D.
	 	Plan means the American Railcar Industries, Inc. Executive Incentive Plan, as
from time to time amended.
	 
	 	 	 	 
	 

	 	E.
	 	Chief Executive Officer means the Chief Executive Officer of American Railcar
Industries, Inc.
	 
	 	 	 	 
	 

	 	F.
	 	Financial Targets are the financial goal(s) of the Company for the Fiscal
Year identified in exhibit B as applied to Participants in Exhibit C.
	 
	 	 	 	 
	 

	 	G.
	 	Personal Goals refer to the personal goals and objectives set by each
Participant and his/her supervisor at the beginning






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	 	 	 	of each Fiscal Year against which performance is measured under Section V below.
	 
	 	 	 	 
	III.	 	EMPLOYEES COVERED BY THIS PLAN
	 
	 	 	 	 
	 	 	Those employees listed on Exhibit C (each a “Participant”) shall be eligible to participate
in this Plan.
	 
	 	 	 	 
	IV.	 	FINANCIAL AWARD
	 
	 	 	 	 
	 	 	A Participant in the Plan shall be entitled to a Financial Award computed as the product of:






	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Participants

	 	X
	 	Bonus as a
	 	X
	 	Performance
	 	X
	 	Individual
	 	=
	 	Participants
	 	 
	Base Salary

	 	 	 	% of Salary
	 	 	 	as a % of
	 	 	 	Performance
	 	 	 	Financial
	 	 
	 

	 	 	 	 	 	 	 	Target
	 	 	 	Rating on a
	 	 	 	Award
	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	0 – 100 scale
	 	 	 	 	 	 






	 	 	 	 	 
	 

	 	A.
	 	“Participant’s Base Salary” shall be the salary as defined in Section II-A in
effect during applicable period.
	 
	 	 	 	 
	 

	 	B.
	 	“Bonus as % of Salary” shall be as set forth in Exhibit A, Table I based upon
Management Level of each Participant.
	 
	 	 	 	 
	 

	 	C.
	 	“Performance as a % of Target” shall be determined in accordance with the
schedule set forth in Exhibit A, Table II based on the attainment of the Company’s
financial target for the applicable period as identified in Exhibit B and as measured
in performance percentages by target for individual per Exhibit C.
	 
	 	 	 	 
	 

	 	D.
	 	“Individual Performance Rating” shall be based on an individual performance
evaluation in accordance with Section V below.
	 
	 	 	 	 
	 

	 	 	 	If a Participant was in more than one management level during a Fiscal Year, a
separate computation shall be made for each level applicable to the Participant
during such Fiscal Year; the sum of the separate computations shall be the
Participant’s Financial Award.
	 
	 	 	 	 
	V.	 	PERSONAL PERFORMANCE RATING
	 
	 	 	 	 
	 	 	Personal goals for each Participant are to be developed jointly by the Participant and
his/her supervisor for the Fiscal Year.






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	 	Attainment of such goals and other performance criteria, both quantifiable and
non-quantifiable, may be used to arrive at an overall individual performance rating from 0%
to 100%. Such criteria shall be applied consistently to Participants with similar duties
pursuant to an evaluation process to be reviewed and approved by the Vice President,
Administration. Criteria that may be weighed in arriving at an individual performance
rating include, without limitation:







	 	•	 	Achievement of income goals by business unit
	 
	 	•	 	Development of subordinates
	 
	 	•	 	Successful development of new accounts/products
	 
	 	•	 	Improvement in product programs
	 
	 	•	 	Attainment of self-development objectives
	 
	 	•	 	Control or reduction of operating expenses by business unit
	 
	 	•	 	Safety record of Facility or Facilities
	 
	 	•	 	Quality Program Achievement





	 	 	 
	 

	 	The supervisor will assign a Personal Performance %, from 0% to 100%, reflecting the
Participant’s performance during such Fiscal Year. The Personal Performance %
recommendation of the supervisor shall be reviewed by the appropriate member of the
Management Committee, who shall recommend an appropriate Personal Performance % to the
Chief Executive Officer who shall approve the final Personal Performance % for each
Participant. The Chief Executive Officer reserves the right, in his sole discretion, to
accept the Personal Performance % recommendation for each Participant or to modify any
Personal Performance % for any Participant to achieve such dispersion of performance
ratings as the Chief Executive Office deems appropriate.
	 
	 	 
	VI.

	 	PERFORMANCE MEASURES, TARGETS AND PAYOUT RANGES
	 
	 	 
	 

	 	The financial performance measures, targets and payout ranges used for incentive purposes
shall be established by the Board of Directors based on the annual business plan. Those
measures, targets and payout ranges, as appropriate, shall be approved by






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	 	the Chief Executive Officer and the Board of Directors. The performance measures, targets
and payout ranges are defined in Exhibit A, B and C.
	 
	 	 
	VII.

	 	PARTICIPANT BONUS COMPOSITION
	 
	 	 
	 

	 	The composition of the bonuses are established by Management Level and communicated
individually to each Participant.
	 
	 	 
	VIII.

	 	COMPUTATION AND DISBURSEMENT OF FUNDS
	 
	 	 
	 

	 	As soon as practicable after the close of the Fiscal Year, the members of the Management
Committee will recommend a Personal Performance % for each Participant in his department to
the Chief Executive Officer and the Board of Directors. In addition, the Chief Financial
Officer of the Company shall calculate the financial performance measure and the proposed
payout under the Plan based upon the Chief Executive Officer’s determination of each
Participant’s Personal Performance % and the achievement of the financial performance
measure. The proposed payout shall be presented to the Board of Directors for final
approval. Once approved, payment of the Financial Awards shall be made as soon as
practicable after the completion of the annual audit.
	 
	 	 
	 

	 	If the Participant dies before receiving his/her award, the amount due will be paid to the
designated beneficiaries on file with the Company and, in the absence of such designation,
to the Participant’s estate.
	 
	 	 
	 

	 	All payment awards shall be reduced by amounts required to be withheld for taxes at the
time payments are made.
	 
	 	 
	IX.

	 	CHANGES TO TARGET
	 
	 	 
	 

	 	The Chairman of the Board of Directors, at any time prior to the final determination of
awards and in consultation with the Board of Directors, may consider changes to the
performance measures, targets, and payout ranges used for incentive purposes, such that if,
in the judgment of the Chairman of the Board of Directors, such change(s) is/are desirable
in the interests of equitable treatment of the Participants and the Company as a result of
extraordinary or non-recurring events, changes in applicable accounting rules or
principles, changes in the Company’s methods of accounting, changes in applicable law,
changes due to consolidation,






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	 	acquisitions, or reorganization. The Chief Executive Officer shall implement such
change(s) for immediate incorporation into the Plan.
	 
	 	 
	X.

	 	A Participant shall be entitled to payment of a partial Financial Award if, prior to the end
of such Fiscal Year, a Participant:







	 	•	 	Dies
	 
	 	•	 	Retires (is eligible to immediately receive retirement benefits under a Company
sponsored retirement plan)
	 
	 	•	 	Becomes permanently disabled
	 
	 	•	 	Transfers to a position with a salary grade not eligible for
participation in the Plan
	 
	 	•	 	Enters military service
	 
	 	•	 	Takes an approved leave of absence
	 
	 	•	 	Is appointed or elected to public office
	 
	 	•	 	Is terminated due to position elimination





	 	 	 
	 

	 	provided that the Participant was an active employee for a minimum of 30 consecutive
calendar days during such Fiscal Year. Such partial awards shall be paid at the time when
payments of awards for such Fiscal Year are made to active Participants.
	 
	 	 
	 

	 	Participants hired, or who otherwise become eligible to participate hereunder, during the
course of a Fiscal Year and who are employed through the end of such Fiscal Year shall be
eligible for a pro-rated award based on their Base Salary during such Fiscal Year and
length of eligible service prior to the end of the Fiscal Year.
	 
	 	 
	XI.

	 	FORFEITURE OF BONUS
	 
	 	 
	 

	 	Except as provided in Section X, no Participant who ceases to be an employee of the Company
prior to the end of a Fiscal Year shall be entitled to any Financial Award under this Plan
for such Fiscal Year unless the Chief Executive Officer determines otherwise.






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	 	Participants who cease to be an employee of the company between the end of a prior Fiscal
Year and the payment date of awards for such prior Fiscal Year shall be entitled to awards
earned during such prior Fiscal Year.
	 
	 	 
	XII.

	 	ADMINISTRATION
	 
	 	 
	 

	 	This Plan shall be administered by the Sr. Director of Human Resources of American Railcar
Industries, Inc., subject to the control and supervision of the Chief Executive Officer and
the Board of Directors of American Railcar Industries, Inc.
	 
	 	 
	 

	 	In the event of a claim or dispute brought forth by a Participant, the decision of the
Chief Executive Officer as to the facts in the case and the meaning and intent of any
provision of the Plan, or its application, shall be final and conclusive.
	 
	 	 
	XIII.

	 	NO EMPLOYMENT CONTRACT; FUTURE PLANS
	 
	 	 
	 

	 	Participation in this Plan shall not confer upon any Participant any right to continue in
the employ of the Company nor interfere in any way with the right of the Company to
terminate any Participant’s employment at any time. The Company is under no obligation to
continue the Plan in future Fiscal Years.
	 
	 	 
	XIV.

	 	AMENDMENT OR TERMINATION
	 
	 	 
	 

	 	The Board of Directors of the Company may at any time, or from time to time, (a) amend,
alter or modify the provisions of this Plan, (b) terminate this Plan, or (c) terminate the
participation of an employee or group of employees in this Plan; provided, however, that in
the event of the termination of this Plan or a termination of participation, the Company
shall provide the partial awards to the affected Participant(s) for the portion of the
Fiscal Year during which such employee(s) were Participants in this Plan, in a manner in
which the Company, in its sole judgment, determines to be equitable to such Participants
and the Board of Directors of the Company.
	 
	 	 
	XV.

	 	GENERAL PROVISIONS






	 	 	 
	A.

	 	No right under the Plan shall be assignable, either voluntarily or
involuntarily by way of encumbrance, pledge, attachment,






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	 	level or charge of any nature (except as may be required by state or federal law).
	 
	 	 
	B.

	 	Nothing in the Plan shall require the Company to segregate or set aside any
funds or other property for the purpose of paying any portion of an award. No
Participant, beneficiary or other person shall have any right, title or interest in
any amount awarded under the Plan prior to the close of the Fiscal Year, or in any
property of the company or its subsidiaries.






	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 
	 	 
	 
	 	 
	Final Approval Date
	 	Chief Executive Officer







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