Document:

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                                                                   Exhibit 10.37

                        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")

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:

<TABLE>
<S>                        <C>                             <C>                              <C>
DATE OF GRANT              ______________________          TOTAL EXERCISE PRICE             ____________________

TYPE OF OPTION             [ ] Incentive Stock Option      TOTAL NUMBER OF SHARES GRANTED   ____________________

                           [ ] Nonstatutory Stock Option   TERM/EXPIRATION DATE             [5 YEARS]

EXERCISE PRICE PER SHARE   [FMV ON GRANT DATE]
</TABLE>

Vesting Schedule:

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

<TABLE>
<CAPTION>
            VESTING DATE               % OF GRANT (OR # OF SHARES) VESTED
------------------------------------   ----------------------------------
<S>                                    <C>
One year anniversary of Grant Date     33.33% of Grant
Two year anniversary of Grant Date     66.66% of Grant
Three year anniversary of Grant Date   100% of Grant
</TABLE>

<PAGE>

PARTICIPANT                             AMERICAN RAILCAR INDUSTRIES, INC.

-------------------------------------   ----------------------------------------
                                        By

-------------------------------------   ----------------------------------------
Print Name                              Title

                                        2

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                        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.

                                        1

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     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

                                        2

<PAGE>

          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.

     13.  Confidentiality, Non-Compete and Non-Solicitation. Pursuant to the
          terms and conditions of the Plan, Participant has executed and
          delivered to the Company the Confidentiality, Non-Compete and
          Non-Solicitation Agreement attached hereto as Exhibit B.

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     14.  Participant Acknowledgement. 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 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.

                                        4

<PAGE>

                                    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.]

                                        5
<PAGE>

Submitted by:                           Accepted by:

PARTICIPANT                             AMERICAN RAILCAR INDUSTRIES, INC.

-------------------------------------   ----------------------------------------
                                        By

-------------------------------------   ----------------------------------------
Print Name                              Title

Address:                                Address:

                                        100 Clark St
                                        St. Charles, MO 63301
                                        Attention: President

                                        ----------------------------------------
                                        Date Received

                                        6

<PAGE>

                                    EXHIBIT B

                        CONFIDENTIALITY, NON-COMPETE AND

                           NON-SOLICITATION AGREEMENT

     This CONFIDENTIALITY, NON-COMPETE AND NON-SOLICITATION AGREEMENT
(hereinafter referred to as "Agreement") made as of the ______ day of
__________, 2006, between American Railcar Industries, Inc. a corporation
incorporated under the laws of the State of Delaware (hereinafter referred to as
"Company") and NAME: _____________________________ (hereinafter referred to as
"Employee").

     WHEREAS, as a condition and inducement of the Company's employment of,
participation in any equity incentive plans, or payment of any incentive owing
to, and transfer of confidential information to the Employee, the Company has
requested and the Employee has agreed to enter into this Agreement.

     NOW THEREFORE in consideration of the provisions contained herein including
the Company's employment of and transfer of confidential information to the
Employee, the Company and the Employee agree as follows:

     1.   DEFINITIONS

     (a) For purposes of this Agreement the terms:

          (i) "Affiliate" shall mean with respect to any specified Person,
          another Person which, directly or indirectly, controls, is controlled
          by, or is under common control with such specified Person;

          (ii) "Company" shall mean American railcar Industries, Inc. and/or any
          of its subsidiaries, parent or related corporations;

          (iii) "Confidential Information" shall mean all information disclosed
          or otherwise made available to the Employee by the Company,
          Affiliates, employees or representatives, about or relating to the
          Company's, or any of its Affiliates' plans, business or activities, or
          employees, including, but not limited to the information set forth in
          any business plan of the Company and information concerning
          advertising, marketing plans and strategies, finances or financial
          condition, accounting, methods, processes, trade secrets,

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          Intellectual Property, product and business plans, and current or
          potential customer, client, business partner or supplier lists and
          records, service charges, rates and fees, investments plans or
          projections, research in respect of acquired or potential target
          investments and communications and all Work Product;

          (iv) "Intellectual Property" shall mean all source-codes,
          object-codes, manuals and other documentation and materials (whether
          or not in written form) and all versions thereof, together with all
          other patents, licenses, trademarks, service marks, trade names
          (whether registered or unregistered), copyrights, proprietary computer
          software, proprietary inventions, proprietary technology, technical
          information, intellectual property, discoveries, designs, proprietary
          rights and non-public information, trade secrets, in each case,
          whether or not patentable;

          (v) "Person" an individual, corporation, partnership, trust or
          unincorporated organization, limited liability company, limited
          liability partnership, joint venture, joint stock company, any
          governmental agency or instrumentality or any other entity;

          (vi) "Work Product" shall mean all work product (tangible, recorded or
          otherwise, and without regard to the form or condition or state of
          completion) including, without limitation, Intellectual Property
          invented, created, assembled or developed in connection with, with
          respect to, for, or in relation to, the Company during the Employee's
          employment by the Company.

     2.   CONFIDENTIALITY

     (a) The Employee shall not (either during the continuance of the Employee's
     employment by the Company or at any time thereafter) disclose any
     Confidential Information to any Person other than designated employees of
     the Company, and all such Confidential Information, either in electronic,
     printed or verbal form will remain the property of the Company and shall
     not be used by the Employee (either during the continuance of employment by
     the Company or at any time thereafter) for Employees own purpose or for any
     purpose other than those of the Company. The Employee agrees that the
     Company will retain proprietary rights in the Confidential Information and
     disclosure to or awareness by the Employee of the Confidential Information
     shall not be deemed to confer any rights whatsoever to the Employee in
     respect of any part of the Confidential Information.

                                        2

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     (b) The restrictions and covenants set forth in (a) above applicable to the
     Confidential Information shall not apply to any portion of the Confidential
     Information that the Employee can clearly demonstrate is at the time of
     disclosure or thereafter generally available to and known by the public
     (other than as a result of its disclosure by the Employee in breach of his
     obligations herein).

     (c) In the event that the Employee is (i) requested by interrogatory,
     subpoena, deposition, civil investigation demand or other similar legal
     process or (ii) required by applicable laws, rules or regulations, to
     disclose any Confidential Information, the Employee shall provide the
     Company with prompt written notice of any such request or requirement so
     that the Company may seek an appropriate protective order. If, failing the
     entry of a protective order, the Employee is, in the written opinion of its
     counsel, compelled to disclose Confidential Information, the Employee may
     disclose that portion of the Confidential Information which its counsel
     advises the Employee in such opinion that it is compelled to disclose. In
     any event, the Employee will not oppose, and shall assist, action by the
     Company in any such proceeding to obtain an appropriate protective order or
     other reliable assurance that confidential treatment will be accorded the
     Confidential Information.

     3.   NON-COMPETE

The Employee covenants and agrees with the Company that during the continuance
of employment, and for a period of one (1) year from the date on which Employee
ceases to be an employee of the Company as a result of either the Employee's
resignation or termination of employment by the Company for "Cause", as defined
herein, the Employee will not:

     (1) within the territory(ies) or region(s) for which the Employee is or was
     responsible when employed, (if the Employee was assigned to a territory or
     region) or,

     (2) (if the employee did not have responsibility for a territory or
     region), within fifty miles from the location at which the employee
     performed work on behalf of the Company,

either directly or indirectly, as principal, agent, owner, employee, partner,
investor, shareholder (other than solely as a holder of not more than 1% of the
issued and outstanding shares of any public corporation), consultant, advisor or
otherwise howsoever participate in, act for, or on behalf of, or for the benefit
of, own, operate, carry on or engage in the operation of or have any financial
interest in or provide, directly or indirectly, financial assistance to or lend
money to or guarantee the debts or obligations of, any Person carrying on or
engaged in any business that is competitive with or identical to the business
conducted by the Company in the United States of America (the "Business"). For
purposes of this Paragraph 3, any one of the following shall constitute "Cause":
(1) the Employee's material breach of this Agreement or Company policy; (2) the
Company's default in

                                        3

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performing its obligations under contracts with other persons or business
entities, or Company's suffering of economic harm, if directly caused by the
Employee; (3) the Employee's fraud with respect to the business or affairs of
the Company or if the Employee is convicted of committing a felony or any crime
involving moral turpitude; or (4) other misconduct by the Employee.

     4.   NON-SOLICITATION

     The Employee covenants and agrees with the Company that during the
     continuance of this employment, and for a period of one (1) year from the
     date on which he ceases to be an employee of the Company for any reason,
     the Employee shall not directly, or indirectly, for himself or for any
     other person or entity:

          (a) attempt to divert or, solicit, interfere with or endeavor to
          entice away from, or attempt to do any of the forgoing with respect
          to, the Company or its Affiliates, any customer, client or any Person
          in the habit of dealing with the Company or its Affiliates, with whom
          the Employee had contact with in a business capacity, was responsible
          for, or had knowledge of Confidential Information about, and the
          Employee shall refrain from committing any act which would in any
          manner jeopardize any relationship the Company has or may have with
          any customer, client or any person or entity;

          (b) interfere with, entice away, hire, encourage, or otherwise attempt
          to obtain the withdrawal of any employee of the Company or Affiliates
          in relation to the Business; or

          (c) advise any Person or entity not to do business with the Company or
          Affiliates in relation to the Business.

     5.   INJUNCTIVE RELIEF

Irreparable harm shall be presumed if the Employee breaches or threatens to
breach any agreement, covenant or provision of this Agreement, and under such
circumstances damages will be impossible to ascertain. Accordingly, the Employee
agrees that in the event of any breach or threatened breach of this Agreement,
the Company shall be entitled to an injunction and other equitable relief
without being required to show irreparable harm, without posting any bond or
security in connection therewith, and that any court of competent jurisdiction
may immediately enjoin any breach or threatened breach of this Agreement. The
equitable remedies contemplated hereby shall not be deemed to be exclusive
remedies for a breach of this Agreement but shall be in addition to all other
remedies available at law or equity.

                                        4

<PAGE>

     6.   INVALIDITY

If any provision of this Agreement is held to be illegal, invalid, or
unenforceable under any present or future law, and if the rights or obligations
under this Agreement will not be materially and adversely affected thereby, (a)
such provision shall be fully severable; (b) this Agreement shall be construed
and enforced as if such illegal, invalid, or unenforceable provision had never
comprised a part hereof; (c) the remaining provisions of this Agreement shall
remain in full force and effect and shall not be affected by the illegal,
invalid, or unenforceable provision or by its severance from this Agreement; and
(d) in lieu of such illegal, invalid, or unenforceable provision, there shall be
added automatically as a part of this Agreement a legal, valid, and enforceable
provision as similar in terms to such illegal, invalid, or unenforceable
provision as may be possible.

     7.   ACKNOWLEDGEMENT

The Employee acknowledges reading and understanding the terms and conditions of
this Agreement, and that the Company has provided a reasonable opportunity for
the employee, if the Employee so chooses, to seek independent legal advice prior
to executing this Agreement.

     8.   GOVERNING LAW/JURISDICTION/SERVICE OF PROCESS

The validity, interpretation, performance, and enforcement of this Agreement
shall be governed by the laws of the State of New York without regard to the
conflict of laws. In any action between or among the parties arising out of this
Agreement, (i) each of the parties irrevocably consents to the exclusive
jurisdiction and venue of the federal and state courts located in the State of
New York; (ii) if any such action is commenced in a state court, then, subject
to applicable law, neither party shall object to the removal of such action to
any federal court located in the State of New York; (iii) each of the parties
irrevocably waives the right to trial by jury; and (iv) each of the parties
irrevocably consents to service of process by first class certified mail, return
receipt requested, postage prepaid, to the address of such party set forth in
the signature page hereto, unless a party notifies the other in writing of a
different address.

     9.   ENTIRE AGREEMENT/AMENDMENTS/WAIVERS/COUNTERPARTS/NOTICES

This Agreement shall constitute the entire agreement among the parties with
respect to the matters covered hereby and shall supersede all previous written,
oral or implied understandings among them with respect to such matters provided
however, that nothing herein shall limit the Employee's responsibilities or the
Company's rights under any business conduct policy. This Agreement or any of its
provisions shall not be amended, waived or otherwise modified except by a
writing executed by all of the parties hereto. No failure or delay by the
Company in exercising its rights and remedies

                                        5

<PAGE>

under or with respect to this Agreement shall operate as a waiver or bar any
further exercise of such rights and remedies. This Agreement may be executed in
any number of counterparts, each of which when executed shall be deemed to be an
original and all of which together shall be deemed to be one and the same
instrument. All notices hereunder shall be given in writing delivered to the
address of the recipient set forth on the signature page hereto.

     10.  MISCELLANEOUS

     (a) This Agreement does not alter, change or modify the employment-at-will
     relationship that exists between the Company and the Employee and nothing
     herein shall be construed as requiring cause for or advance notice of
     termination of employment.

     (b) This Agreement shall be binding upon and inure to the benefit of the
     parties and their successors and permitted assigns, as the case may be. The
     Company may assign this Agreement to any affiliate of the Company and to
     any successor or assign of all or a substantial portion of the Company's
     business. The Employee may not assign or transfer any of his rights or
     obligations under this Agreement.

          IN WITNESS WHEREOF the parties hereto have executed this
Confidentiality, Non-Compete and Non-Solicitation Agreement as of the date first
written above.

                                        ----------------------------------------
                                        Print Name

                                        ----------------------------------------
                                        Employee Signature

                                        Employee Address:

                                        ----------------------------------------

                                        ----------------------------------------

                                        AMERICAN RAILCAR INDUSTRIES, INC.

                                        ----------------------------------------
                                        Name: James J. Unger
                                        Title: President and Chief Executive
                                               Officer

                                        6<PAGE>

                                                                   EXHIBIT 10.38

                        AMERICAN RAILCAR INDUSTRIES, INC.

                          2005 Executive Incentive Plan

I.    PURPOSE

      The American Railcar Industries, Inc. 2005 Executive Incentive Plan has
      been established 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 and 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 of each
            Fiscal Year against which performance is measured under Section V
            below.

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<PAGE>

III.  EMPLOYEES COVERED BY THIS PLAN

      Those employees who are incumbents listed on Exhibit C or become employees
      in position levels as listed on Exhibit C (each a "Participant") and whom
      have a signed Confidentiality, Non-Compete and Non-Solicitation Agreement
      on file, 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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<PAGE>

      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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<PAGE>

      acquisitions, or reorganization. The Chief Executive Officer shall
      implement such changes(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 60
      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 so long as the Participant was
      in a bonus eligible position for at least 60 days.

XI.   FORFEITURE OF BONUS

      Except as provided in Section X, no Participant who ceases to be an
      employee of the Company prior to the payment date of the award shall be
      entitled to any Financial Award under this Plan for

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<PAGE>

      such Fiscal Year unless the Chief Executive Officer in consultation with
      the Board of Directors determines otherwise.

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

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      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:

Adopted by the Board of Directors on: December 23, 2005

Amended by Board of Directors on: February 28, 2006

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