Exhibit 10a

 

 

DESCRIPTION OF PERFORMANCE GOALS

ESTABLISHED IN CONNECTION WITH 2008-2010 CASH PERFORMANCE PLAN UNDER THE 2007
LONG-TERM INCENTIVE PLAN

 

The Compensation and Management Development Committee of the Board of Directors
of ArvinMeritor, Inc. (“ArvinMeritor”), established a cash performance plan for
the three-year performance period ending September 30, 2010, under Section 13 of
the 2007 Long-Term Incentive Plan, as amended. Performance goals are based on
ArvinMeritor’s return on invested capital (“ROIC”), defined to mean the sum of
ArvinMeritor’s net income for the three years in the performance cycle (before
cumulative effect of accounting changes, gains and losses on sale of businesses,
minority interest, tax-effected interest expense and tax effected restructuring
expense) divided by the sum of the average invested capital (total debt,
including preferred capital securities, minority interests and shareowners’
equity), for the three fiscal years in the performance period.

 

The Compensation Committee also established target awards, stated as dollar
amounts, for each participant. Participants can earn from 0% to 200% of his
target award, based on actual ROIC against specified levels. Payouts are also
multiplied by the percentage change in the price of ArvinMeritor common stock
over the three-year performance period, which may increase the payment finally
awarded up to a maximum of 200% of the original amount or reduce it down to a
minimum of 50% of the original amount. The following chart summarizes the
potential payouts at different levels of performance:

 

 

 

 

Performance Level

 

 

 

ROIC

 

Percentage of Target Award Earned

and Paid Out

Range of Possible Percentages Earned After Giving Effect to Stock Price
Multiplier

Threshold for Payout

8.0%

25%

12.5 – 50%

Target Payout

10.5%

100%

50 – 200%

Maximum Payout

13.0%

200%

100 – 400%