Limited Liability Company Agreement

Exhibit 10.49 AXLE MANUFACTURING, LLC Limited Liability Company Agreement Organized Under the Delaware Limited
Liability Company Act THE INTERESTS DESCRIBED AND REPRESENTED BY THIS OPERATING AGREEMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE " 33 ACT" ) OR ANY APPLICABLE STATE SECURITIES LAWS (THE " STATE ACTS" ) AND ARE RESTRICTED SECURITIES AS THAT TERM IS DEFINED IN RULE 144 UNDER THE 33 ACT. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR QUALIFICATION UNDER THE 33 ACT AND APPLICABLE STATE ACTS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE 33 ACT AND APPLICABLE STATE ACTS, THE AVAILABILITY OF WHICH MUST BE ESTABLISHED TO THE SATISFACTION OF THE COMPANY.


ARTICLE I
ORGANIZATIONAL MATTERS; DEFINITIONS 1 1.1 Name 1 1.2 Effective Date; Term 1 1.3 Registered Office; Place of Business; Agent 1 1.4 Intent to Supersede Act 1 1.5 Definitions 1 1.6 Authorized Person 1 ARTICLE II
PURPOSE 2 2.1 Purpose 2 ARTICLE III
MEMBERS; RIGHTS OF AND LIMITATIONS ON MEMBERS 2 3.1 Members; Guarantee of Obligations 2 3.2 Limitations on Members 2 3.3 By-laws 3 3.4 Title to Property 3 3.5 Payments of Individual Obligations 3 3.6 Members May Compete 3 ARTICLE IV
BOARD OF DIRECTORS; EXECUTIVE COMMITTEE; RIGHTS, POWERS AND DUTIES; VOTING; OTHER MATTERS CONCERNING MEMBERS 4 4.1 Management of the Company 4 4.2 Board of Directors 4 4.3 Executive Committee 4 4.4 Executive Committee Voting; Meeting 5 4.5 Required Approvals of Executive Committee 6 4.6 Appointment of Officers; Delegation of Authority 7 4.7 Exculpation of Members and Representative 8 4.8 Resignation and Removal of Representative; Vacancies 8 4.9 Tax Elections; Tax Matters Member 8 ARTICLE V
RIGHTS, POWERS AND DUTIES OF OFFICERS 9 5.1 Officers 9 5.2 Rights and Responsibilities of Officers 9 5.3 Salaries 12 ARTICLE VI
BUY-SELL RIGHTS; CALL RIGHTS 12 6.1 Offer to Buy-Sell 12 6.2 Call Rights 13 ARTICLE VII
COMPANY CAPITAL; ADVANCES BY MEMBERS 14 7.1 Capital Contributions 14 7.2 Additional Capital Contributions 14 - i -


7.3 No Return of Contributions 14 7.4 No Partition of Company Property 14 ARTICLE VIII
FISCAL YEAR; ACCOUNTING; ALLOCATION OF PROFITS AND LOSSES; DISTRIBUTIONS 15 8.1 Fiscal Year 15 8.2 Method of Accounting 15 8.3 Maintenance of Capital Accounts 15 8.4 Allocation of Profits and Losses 15 8.5 Distribution of Net Cash Flow 16 8.6 Definition of Net Cash Flow 17 8.7 Liability of Member for Return of Distribution 17 ARTICLE IX
TRANSFER OF COMPANY INTERESTS 17 9.1 No Transfer of Company Interest 17 9.2 Compliance with Securities Act of 1933 18 9.3 Transfer of Interest to Affiliates 18 9.4 Transfer of Interest of Initial Member 18 9.5 Admission of Transferee as Substituted Member 18 9.6 Allocations and Distributions with Respect to Transferred Interests 19 ARTICLE X
WITHDRAWAL, BANKRUPTCY OR LIQUIDATION OF MEMBERS 19 10.1 Withdrawal of Member 19 10.2 Bankruptcy, Liquidation of a Member 19 10.3 Bankruptcy of Member 19 ARTICLE XI
TERMINATION, DISSOLUTION AND LIQUIDATION OF THE COMPANY 19 11.1 Events of Dissolution 19 11.2 Liquidation 20 11.3 Election of Liquidating Trustee 20 11.4 Statements 20 ARTICLE XII
AMENDMENT OF THE AGREEMENT 21 12.1 Ordinary Course Amendments 21 12.2 Other Amendments 21 ARTICLE XIII
TAX PROVISIONS 21 13.1 Allocations Required by Treasury Regulations 21 13.2 Rules of Application 23 13.3 Rules Concerning Calculations of Profits and Losses and Code Section 704(c) Tax Allocations 23 - ii -


ARTICLE XIV
ADDITIONAL COVENANTS; OTHER AGREEMENTS 25 14.1 Confidentiality; Trade Secrets; Use of Names, Etc 25 14.2 Supply Agreement 25 14.3 Marketing Agreement 25 14.4 Press Release 25 ARTICLE XV
INDEMNIFICATION 26 15.1 Indemnification as to Actions or Omissions in Company' s Business 26 15.2 Cross Indemnification 26 15.3 Procedure for Indemnification 26 15.4 Survival 27 ARTICLE XVI
DEFAULT AND REMEDIES 27 16.1 Defaults 27 16.2 Remedies 27 ARTICLE XVII
MISCELLANEOUS 28 17.1 Notices 28 17.2 Governing Law 28 17.3 Business Practices 28 17.4 Counterparts 28 17.5 Language Conventions; Captions 28 17.6 Entire Agreement 28 17.7 Provisions Severable 28 17.8 Binding Agreement 29 17.9 Further Action 29 17.10 Waivers 29 Schedule A, List of Members, Addresses, Etc.
Appendix A, Definitions
Exhibit A, Supply Agreement
Exhibit B, Marketing Agreement - iii -


AXLE MANUFACTURING, LLC Limited Liability Company Agreement This Limited Liability Company Agreement (this " Agreement" ) evidences the mutual agreement of the Members (as hereinafter defined) in consideration of their contributions and promises each to the others, for the purpose of forming a limited liability company pursuant to the Delaware Limited Liability Company Act, Del. Code Ann. title 6, a7a718-101 et. seq., as the same may be amended from time to time (the " Act" ). ARTICLE I
ORGANIZATIONAL MATTERS; DEFINITIONS 1.1 Name . The name of the limited liability company governed hereby (the " Company" ) is Axle Manufacturing, LLC. The Company may operate the business under one or more fictitious names. 1.2 Effective Date; Term . This Agreement shall become effective on June 28, 2007 (" Effective Date" ), and shall continue until terminated pursuant to the provisions of this Agreement. 1.3 Registered Office; Place of Business; Agent . The address of the registered office of the Company as required by a718-104 of the Act and the principal place of business of the Company (which need not be the same as the registered office) shall be as indicated on Schedule A attached hereto. The Company may change the location of the registered office, establish additional offices or places of business or enter into such contracts or hire such agents in such other locations, inside and outside of Delaware, as it deems necessary or desirable in the conduct of the business of the Company. The agent of the Company for service of process, as required by a718-104 of the Act, shall be The Corporation Trust Company, 1209 Orange Street, Wilmington, DE 19801. 1.4 Intent to Supersede Act . The Members intend that the terms of this Agreement control all the activities of the Company. Therefore, this Agreement supersedes all non-mandatory provisions of the Act. 1.5 Definitions . Capitalized terms used in this Agreement have the meanings as defined throughout the text of this Agreement or in Appendix A. A list of defined terms, including the section of this Agreement in which the term is defined, is contained in Appendix A. 1.6 Authorized Person . Robert J. Minkus is hereby designated an " authorized person" within the meaning of the Act, and is hereby authorized to execute, deliver and file the certificate of formation required by a718-201 of the Act (" Certificate" ) with the secretary of state of Delaware. Upon completing the foregoing duties, his powers as an " authorized person" shall cease, and any " authorized person" shall hereafter be designated by the Executive Committee.

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ARTICLE II
PURPOSE 2.1 Purpose . The purpose of the Company is to acquire or lease real property and the other assets for the purpose of constructing a facility (the " Facility" ) to manufacture and sell railcar axles (the " Business" ) and to operate the Business and to exercise all powers and engage in all activities incident thereto. Without limiting the foregoing, but subject to the provisions of this Agreement, the Company may enter into such arrangements, including the formation of subsidiaries and the transfer of its properties to such subsidiaries, in such form and manner as may be prudent and appropriate to acquire the Facility and conduct the Business. ARTICLE III
MEMBERS; RIGHTS OF AND LIMITATIONS ON MEMBERS 3.1 Members; Guarantee of Obligations . The initial Members are (i) ARI Component Venture LLC, a Delaware limited liability company (the " ARI Member" ) and wholly-owned subsidiary of American Railcar Industries, Inc., a Delaware corporation, and (ii) ASF-Keystone, Inc., a Delaware corporation (the " ASF Member" ) and wholly-owned subsidiary of Amsted Industries Incorporated, a Delaware corporation. The terms " ARI Member" and " ASF Member" shall include, respectively, any transferees of such Member (as defined below) pursuant to section 9.3 hereto. The names and addresses of the members of the Company (the " Members" ), as they may be from time to time, will be set forth on Schedule A, as amended from time to time. Schedule A also identifies the amount of each Member' s initial contribution to the capital of the Company, the number of Units credited to each Member and each Member' s Percentage Interest. Additional Members may be added upon approval of the Executive Committee. Any such new Members will be permitted, upon such approval, to purchase Units at an amount per Unit to be determined by the Executive Committee, provided, however, that the ownership of all such additional Members may not, individually or in the aggregate, reduce the collective percentage held by the ARI Member and the ASF Member (and their respective transferees) to less than 60% of the outstanding Units of the Company. American Railcar Industries, Inc. and Amsted Industries Incorporated hereby agree to absolutely and unconditionally guarantee the obligations, respectively, of the ARI Member and the ASF Member (and their respective transferees pursuant to section 9.3), pursuant to sections 6.1, 7.1 and 7.2 of this Agreement. To the maximum extent provided by law, such guarantee obligations shall not be reduced or modified by anything that would otherwise constitute a defense by a guarantor. The Executive Committee may require, at its discretion, as a condition to approval of an additional Member, a similar guaranty from the parent (if any) of the additional Member. 3.2 Limitations on Members . No Member may: (a) Sign for or bind the Company by virtue of being a Member, direct or bind the Company on environmental or other issues or hold itself out as an agent of another Member;

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(b) Have such Member' s Capital Contribution repaid except to the extent provided in this Agreement; (c) Except as permitted by this Agreement, withdraw from the Company; (d) Sell or assign such Member' s interest in the Company or constitute the purchaser or assignee thereunder a substituted Member, except as provided in Articles VI and IX hereof; (e) Except as permitted by this Agreement, have priority over any other Member, either as to the return of Capital Contributions or as to the allocation of Profits, Losses or the distribution of Net Cash Flow, provided that this limitation shall not apply to the repayment by the Company of loans (as distinguished from Capital Contributions) which a Member was permitted to make under this Agreement and has made to the Company; or (f) Have any preemptive or preferential right, including any such right with respect to (i) additional Capital Contributions; (ii) issuance or sale of Units, whether unissued or hereafter created; (iii) issuance of any obligations, evidences of indebtedness or other securities of the Company convertible into or exchangeable for, or carrying or accompanied by any rights to receive, purchase or subscribe to, any such unissued Units; (iv) issuance of any right of, subscription to or right to receive, or any warrant or option for the purchase of, any of the foregoing securities; or (v) issuance or sale of any other securities that may be issued or sold by the Company. 3.3 By-laws . The Company may adopt By-laws approved by the Executive Committee for the conduct of the Company' s business and regulation of its affairs that are not inconsistent with the Certificate or this Agreement. 3.4 Title to Property . All property owned by the Company shall be owned by the Company or a subsidiary as an entity, and no Member shall have any ownership interest in such property in its individual name or right. The Company shall hold all of its property in the name of the Company or a subsidiary and not in the name of any Member. Each Member' s interest in the Company shall be personal property for all purposes. 3.5 Payments of Individual Obligations . The Company' s credit and assets shall be used solely for the benefit of the Company, and no asset of the Company shall be transferred or encumbered for or in payment of any individual obligation of a Member. Notwithstanding the preceding, the Company shall reimburse a Member for legitimate expenses incurred on behalf of the Company, including a fair amount for the time of any employee or non-executive officer of a Member rendering services to the Company on a full-time or part-time basis. No reimbursement shall be due or payable with respect to the time of any executive officer of any Member. 3.6 Members May Compete . Members shall not in any way be prohibited from or restricted in engaging or owning an interest in any other business venture of any nature, including any venture which might be competitive with the business of the Company.

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ARTICLE IV
BOARD OF DIRECTORS;
EXECUTIVE COMMITTEE;
RIGHTS, POWERS AND DUTIES; VOTING;
OTHER MATTERS CONCERNING MEMBERS 4.1 Management of the Company . The Members shall manage or cause to be managed the affairs of the Company in a prudent and businesslike manner. Members shall act through an Executive Committee (the " Executive Committee" ) for the ordinary course management of the Business, and the affairs and property of the Company, as further described below in section 4.3. Additionally, certain specified extraordinary actions may be taken by the Company only if approved by the Board of Directors, as further described in section 4.2. 4.2 Board of Directors . (a) Each Member shall have one seat on the Board of Directors upon becoming a Member, provided that as long as a Member holds at least 30% of the outstanding Units, such Member shall have two seats on the Board of Directors. (b) Except as otherwise expressly set forth in this Agreement, or required by the Act, the vote or consent by at least a majority of Board of Directors members shall be required for the Board of Directors to take any action required or allowed under the terms of this Agreement relating to the merger, sale or other transfer of ownership or change of control of the Company, including a sale of substantially all of the assets of the Company. (c) A majority of the Board members must be present to constitute a quorum. Any Member may participate in a meeting of the Board of Directors by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other and participation in the meeting by means of such equipment will constitute presence in person at such meeting. At any meeting of the Board of Directors, the Members shall appoint a person to act as secretary of the meeting, who shall promptly prepare and certify a minute of action taken at the meeting. The ARI Representative shall serve as chairman of each meeting of the Board of Directors during 2007 and every second year thereafter, and the ASF Representative shall serve as chairman of each meeting of the Board of Directors during 2008 and every second year thereafter. The chairman shall be responsible for the organization and conduct of the meeting in accordance with rules and procedures prescribed by the By-laws (if any). (d) For decisions regarding all matters other than those set forth in section 4.2(b) hereto, the Members shall act through the Executive Committee, as described in section 4.3. 4.3 Executive Committee . (a) The Executive Committee shall be comprised of two representatives (each, a " Representative" and together the " Representatives" ), one appointed by the ARI

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Member (the " ARI Representative" ) and one appointed by the ASF Member (the " ASF Representative" ). Either of the ARI Member or the ASF Member may designate its Representative, and remove and replace its Representative, immediately upon providing written notice thereof to the other Members and all Representatives. The initial ARI Representative will be James Unger, and the initial ASF Representative will be John Wories, Jr. No Representative shall be entitled to compensation for serving in such capacity, but shall receive reimbursement for his reasonable expenses. (b) The Representatives, acting as the Executive Committee, shall have full and complete authority, power and discretion to manage and control the Business, affairs and property of the Company, to make all decisions regarding those matters and to perform any and all other acts or activities customary or incident to the management of the Company' s business and objectives, within the terms of and limitations set forth by this Agreement. No one Representative may take or effect any action on behalf of the Company or otherwise bind the Company in the absence of a formal delegation of authority by the Executive Committee to such Representative, except as otherwise permitted by this Agreement. Unless authorized to do so by this Agreement or by the Executive Committee, no Member, Officer, attorney-in-fact, employee or other agent of the Company shall have any power or authority to bind the Company. 4.4 Executive Committee Voting; Meeting . (a) The approval of the Executive Committee of any action on behalf of the Company must be evidenced by a minute of a meeting of the Executive Committee properly noticed and held as provided in the by-laws or by a unanimous written consent signed by all Representatives. (b) The Executive Committee shall meet at least once each year in a location agreed upon by the ARI Member and the ASF Member. Either of the ARI Member and the ASF Member may call additional meetings of the Executive Committee at any time upon at least five but no more than 20 days written notice to the other Members and all Representatives. All Representatives must be present to constitute a quorum. Any Representative may participate in a meeting of the Executive Committee by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other and participation in the meeting by means of such equipment will constitute presence in person at such meeting. At any meeting of the Executive Committee, the Representatives shall appoint a person to act as secretary of the meeting, who shall promptly prepare and certify a minute of action taken at the meeting. The ARI Representative shall serve as chairman of each meeting of the Executive Committee during 2007 and every second year thereafter, and the ASF Representative shall serve as chairman of each meeting of the Executive Committee during 2008 and every second year thereafter. The chairman shall be responsible for the organization and conduct of the meeting in accordance with rules and procedures prescribed by the By-laws (if any).

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4.5 Required Approvals of Executive Committee . In furtherance of section 4.3(b) and not by way of limitation, the Company may take any of the following actions with the unanimous approval of the Executive Committee, and only with such unanimous approval: (a) Sell, transfer, exchange, grant perpetual licenses, or otherwise dispose of all or substantially all the Company' s assets (including those in any Facility), including goodwill, in a single or series of transactions, or merge, consolidate, liquidate, dissolve or reorganize the Company or any of its subsidiaries; (b) Admit any additional Members to the Company; (c) Acquire substantially all of the assets of, or any equity interest in, any Person, except for any subsidiary that is substantially wholly-owned; (d) Acquire or lease any real property as a location for the Facility and to serve as the primary business address of the Business; (e) Approve the budget for construction of the Facility and procurement of equipment to be used by the Business; (f) Take any action outside the ordinary course of business of the Company, or change the nature or character (including without limitation through expansion or contraction) of the Business; (g) Issue bonds, debentures, negotiable obligations or other similar instruments of debt, obtain any loan from any Person (except for trade payables) including loans from a Member, issue any securities or debt convertible into securities of the Company, guarantee any obligations of any third parties (other than Affiliates of the Company in the ordinary course of business) or assign the assets of the Company in trust for creditors or on the assignee' s promise to pay the debts of the Company; (h) Enter into or approve any transaction between the Company and any of the Members or their respective Affiliates; (i) Approve and amend by-laws pursuant to section 3.3; (j) Retain cash in the Company pursuant to section 8.6(d); (k) Admit any assignee of a Member' s interest in the Company (other than an Affiliate) as a substituted Member pursuant to section 9.5; (l) Approve the annual Budget for the Company; (m) Expend during any Fiscal Year or commit in such Fiscal Year to spend (whether during that or a future Fiscal Year) any amount for operations or capital improvements in excess of the aggregate approved expenditures set forth

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in the Budget, or expend during any Fiscal Year or commit in such Fiscal Year to spend (whether during that or a future Fiscal Year) more than 110% of the expenditures set forth in the Budget for such Fiscal Year in any one category or for any one capital project; (n) Commence any litigation, confess a judgment or settle any claim against or by or on behalf of the Company or submit a claim or liability of the Company to arbitration; (o) Approve the distributions as required by this Agreement and determine or change the frequency of distributions pursuant to section 8.5; (p) Subject to section 7.2, authorize or require contributions to capital in excess of those listed on Schedule A (prior to any amendment thereof), or approve the terms of any loan from a Member or its Affiliate, other than loans permitted by section 16.2(b); and (q) Establish all environmental policies and procedures. (r) Subject to section 2.1, determine the production levels and related matters with respect to the Facility; (s) Waive an opinion concerning compliance with or exemption from securities laws pursuant to section 9.2; (t) Establish procedures for the establishment of and withdrawal from bank accounts; (u) Appoint or change the auditors for the Company; (v) Establish or change the accounting methods used by the Company; (w) Select one or more Approved Banks; an " Approved Bank" shall be any bank or trust company established under the laws of the United States of America or any state thereof that has a combined capital and surplus and undivided profits (less any undivided losses) of not less than U.S.$10,000,000,000; (x) Hire or fire any Officer; and (y) Undertake any of the actions listed in the foregoing clauses (a) - (y) through or on behalf of a subsidiary of the Company. 4.6 Appointment of Officers; Delegation of Authority . In connection with the management of the Business and affairs of the Company, the Executive Committee shall have the responsibility and authority to hire and fire Officers of the Company and its subsidiaries (which Officers may be current employees of a Member or their respective Affiliates, and may be " seconded" or " leased" to the Company or its subsidiaries on a full or part time basis), and

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delegate to Officers limited power and authority (except with respect to the matters reserved for decision by the Executive Committee under section 4.5 or elsewhere in this Agreement), to do all things and on such terms as they, in their reasonable discretion and subject to the terms of this Agreement, deem necessary or appropriate to conduct the Business and to exercise all powers and to effectuate the purpose set forth in section 2.1. Without limiting the generality of the foregoing, the Executive Committee has delegated to the Officers responsibility for, and hereby mandates that the Officers shall cause the Company to take, the actions set forth in section 5.2 4.7 Exculpation of Members and Representative . In carrying out their duties hereunder, the Members and Representatives shall not be liable to the Company or to any other Member for their good faith actions, or failure to act, or for any errors of judgment, or for any act or omission believed in good faith to be within the scope of authority conferred by this Agreement, but only for their own fraud, bad faith, willful misconduct or gross negligence in the performance of their obligations under this Agreement. 4.8 Resignation and Removal of Representative; Vacancies . (a) Any Representative of the Company may resign at any time by giving written notice to the Members and the other Representatives. The resignation of any Representative shall take effect upon receipt of notice thereof or at such later date specified in such notice; and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. (b) No Representative may be removed except by the Member that appointed him. 4.9 Tax Elections; Tax Matters Member . The ARI Member will be the " Tax Matters Member" and shall make and determine all elections with respect to the Internal Revenue Code of 1986, as amended from time to time (the " Code" ) and Treasury Regulations (" Treasury Regulations" or " Treas. Reg." ) issued thereunder. The Tax Matters Member shall be the " tax matters partner" (as defined in Code Section 6231) and is authorized and required to represent the Company (at the Company' s expense) in connection with all examinations of the Company' s affairs by tax authorities and to take all necessary actions in connection therewith, including granting powers of attorney, and to expend Company funds for professional services and costs associated therewith. The Tax Matters Member shall provide all notices and perform all acts required of a tax matters partner under Subchapter C of Chapter 63 of the Code. The Tax Matters Member shall cause the Company to prepare all income and other tax returns of the Company and all subsidiaries, in accordance with this Agreement, and shall cause the same to be filed in a timely manner. The Tax Matters Member shall cause Schedule K-1 to be delivered no later than 90 days after the end of the Fiscal Year. The Tax Matters Member is authorized to take any action that it determines to be necessary to comply with the requirements of Code Sections 1441, 1442, 1445 or 1446 with respect to withholding certain amounts with respect to payments or distributions to a Member who is not a U.S. person (as defined in Code Section 7701) or withholding of certain amounts with respect to the sale of a " United States real property interest" (as defined in Code Section 897) or with respect to any withholding requirements of foreign law applicable to income or distributions from any subsidiary of the Company.

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Notwithstanding anything to the contrary contained herein, the ARI Member, in its capacity as the Tax Matters Member, shall not take any of the following actions without first obtaining the prior written consent of the other Members: (1) Extend the statute of limitations for assessing or computing any tax liability against the Company (or the amount or character of any Company tax item); (2) Settle any audit with the Internal Revenue Service (" IRS" ) concerning the adjustment or readjustment of any Company tax item; (3) File a request for an administrative adjustment with the IRS at any time or file a petition for judicial review with respect to any IRS adjustment; (4) Initiate or settle any judicial review or action concerning the amount or character of any Company tax item; or (5) Take any other action which would have the affect of finally resolving a tax matter affecting the rights of the Company and its Members. The Tax Matters Member shall keep the Members and Representatives advised of any dispute the Company may have with any federal, state or local taxing authority and shall afford the Members the right to participate directly in negotiations with any such taxing authority in an effort to resolve any such dispute. Notwithstanding anything to the contrary in this Agreement, at least 30 days before making or changing any election pursuant to the Code, the Treasury Regulations or any IRS ...