<PAGE> 1
Filed pursuant to Rule 424(b)(5)
Registration No. 333-67307
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED DECEMBER 30, 1998)
$1,000,000,000
[DANA CORPORATION LOGO] DANA CORPORATION
$250,000,000 6 1/4% NOTES DUE 2004
$350,000,000 6 1/2% NOTES DUE 2009
$400,000,000 7% NOTES DUE 2029
----------------------
The 2004 notes will mature on March 1, 2004, and will bear interest at the
rate of 6 1/4% per year. The 2009 notes will mature on March 1, 2009, and will
bear interest at the rate of 6 1/2% per year. The 2029 notes will mature on
March 1, 2029, and will bear interest at the rate of 7% per year. Interest on
the notes is payable on March 1 and September 1 of each year, beginning
September 1, 1999. Dana may redeem the notes at any time prior to maturity, in
whole or in part, as further described in this prospectus supplement. The notes
will be represented by global securities registered in the name of a nominee of
The Depository Trust Company and will be issued in denominations of $1,000 and
integral multiples of $1,000.
The notes are unsecured and rank equally with all our other unsecured and
unsubordinated indebtedness. The notes will not be convertible into or
exchangeable for our common or preferred stock, will not be entitled to the
benefit of any sinking fund and will not be listed on any securities exchange.
----------------------
<TABLE>
<CAPTION>
PROCEEDS TO
PUBLIC OFFERING UNDERWRITING DANA, BEFORE
PRICE(1) DISCOUNT EXPENSES
--------------- ------------ ----------------
<S> <C> <C> <C>
Per 2004 Note...................................... 99.903% .600% 99.303%
Total.............................................. $249,757,500 $1,500,000 $248,257,500
Per 2009 Note...................................... 99.429% .650% 98.779%
Total.............................................. $348,001,500 $2,275,000 $345,726,500
Per 2029 Note...................................... 98.888% .875% 98.013%
Total.............................................. $395,552,000 $3,500,000 $392,052,000
Total......................................... $993,311,000 $7,275,000 $986,036,000
</TABLE>
(1) Plus accrued interest from March 3, 1999, if settlement occurs after
that date
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or determined if this
prospectus supplement or the accompanying prospectus is truthful or complete.
Any representation to the contrary is a criminal offense.
The notes will be ready for delivery in book entry form only through The
Depository Trust Company on or about March 3, 1999.
----------------------
MERRILL LYNCH & CO.
BT ALEX. BROWN
DEUTSCHE BANK SECURITIES
DONALDSON, LUFKIN & JENRETTE
FIRST CHICAGO CAPITAL MARKETS, INC.
A BANK ONE COMPANY
J.P. MORGAN & CO.
LEHMAN BROTHERS
MORGAN STANLEY DEAN WITTER
NATIONSBANC MONTGOMERY
SECURITIES LLC
SALOMON SMITH BARNEY
----------------------
THE DATE OF THIS PROSPECTUS SUPPLEMENT IS FEBRUARY 26, 1999.
<PAGE> 2
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
THE COMPANY................................................. S-3
USE OF PROCEEDS............................................. S-3
CAPITALIZATION.............................................. S-4
SELECTED FINANCIAL DATA..................................... S-5
BUSINESS.................................................... S-8
DESCRIPTION OF THE NOTES.................................... S-11
UNDERWRITING................................................ S-13
LEGAL MATTERS............................................... S-13
PROSPECTUS
ABOUT THIS PROSPECTUS....................................... 2
WHERE YOU CAN FIND MORE INFORMATION......................... 2
THE COMPANY................................................. 3
USE OF PROCEEDS............................................. 4
RATIO OF EARNINGS TO FIXED CHARGES.......................... 4
DESCRIPTION OF CAPITAL STOCK................................ 4
DESCRIPTION OF DEBT SECURITIES.............................. 7
PLAN OF DISTRIBUTION........................................ 14
LEGAL MATTERS............................................... 15
EXPERTS..................................................... 15
</TABLE>
----------------------
You should rely only on the information contained or incorporated by
reference in this prospectus supplement and the accompanying prospectus. We and
the underwriters have not authorized any other person to provide you with
different information. If anyone provides you with different or inconsistent
information, you should not rely on it. We and the underwriters are not making
an offer to sell these securities in any jurisdiction where the offer or sale is
not permitted. You should assume that the information appearing in this
prospectus supplement and the accompanying prospectus, as well as information we
previously filed with the Securities and Exchange Commission and incorporated by
reference, is accurate as of the date on the front cover of this prospectus
supplement only. Our business, financial condition, results of operations and
prospects may have changed since that date.
S-2
<PAGE> 3
THE COMPANY
Dana Corporation was founded in 1904 as the first supplier of universal
joints to the automotive industry. Today, we are one of the world's largest
independent suppliers to vehicle manufacturers and the related aftermarkets. We
supply the types of components and systems used on the vast majority of the
world's 700 million motor vehicles. References to Dana in this supplement
include our consolidated subsidiaries unless the context indicates otherwise.
To serve our global markets, we have seven strategic business
units -- Automotive Systems Group, Automotive Aftermarket Group, Engine Systems
Group, Heavy Truck Group, Off-Highway Systems Group, Industrial Group and
Leasing Services -- and regional administrative organizations in North America,
Europe, South America and Asia/Pacific.
Our core products and services, by type, are axle, engine, brake,
driveshaft, fluid system, structural, industrial, sealing, filtration and
leasing service.
In July 1998, we merged a subsidiary with Echlin Inc., another worldwide
supplier of automotive products. This merger helped our growth objectives in
several ways. First, we believe that Echlin's aftermarket brake parts have
above-industry growth prospects because of superior performance due to new
technology and materials. Second, our expanded portfolio of branded products is
important for our entry into emerging international markets. And, finally, we
can now integrate brake system components, vehicle fluid handling systems, and
electronic ignition and engine management systems with our drivetrain and engine
systems product lines.
In December 1998, we acquired the Glacier Vandervell bearings and the AE
Clevite North American aftermarket engine hard parts businesses from
Federal-Mogul Corporation. This acquisition added to our broad offering of
internal engine components.
These acquisitions were part of a series of steps we have taken in the past
two years to focus on and strengthen our core products and businesses. In this
period, we completed strategic acquisitions of operations with annualized sales
of over $5.3 billion. In addition to Echlin, Glacier Vandervell and AE Clevite,
we acquired the Clark-Hurth Components assets of Ingersoll-Rand Company, the
Sealed Power Division of SPX Corporation, and the heavy axle and brake business
of Eaton Corporation. We also completed significant restructuring and
rationalization, including the sale of our European distribution operations and
other operations not core to our business.
These steps have taken us closer to two goals which we have been pursuing
for some time. The first goal is to balance our sales to our original equipment
highway vehicle markets with those to our diversified (off-highway, industrial
and distribution) markets. In 1998, those sales were 56% and 44%, respectively.
The second goal is to balance our U.S. and international sales, including sales
of non-consolidated affiliates. In 1998, those sales were 59% and 41%,
respectively. We will continue to measure the performance of our operations,
review the structure of our organization and assess potential acquisitions,
divestitures, joint ventures and other business alliances that may fit with
these long term objectives.
USE OF PROCEEDS
We plan to use the net proceeds from the sale of the notes to refinance
interim financing arranged for the acquisition of the Glacier Vandervell
bearings and AE Clevite aftermarket engine hard parts businesses and to
refinance a portion of our other short-term debt. Currently the debt to be
refinanced has an average weighted interest rate of 5.41%. The interim financing
matures December 13, 1999.
S-3
<PAGE> 4
CAPITALIZATION
The first table below summarizes our capitalization as of December 31,
1998, and our capitalization as adjusted to give effect to the notes (after
discounts, commissions, fees and expenses of approximately $14.6 million). The
second table presents the same information with Dana Credit Corporation, or DCC,
a wholly-owned subsidiary, included on an equity basis. You should read this
information in conjunction with the "Selected Financial Data" section and the
financial statements and notes appearing elsewhere in this supplement or in the
documents that we have incorporated by reference.
DANA AND CONSOLIDATED SUBSIDIARIES
<TABLE>
<CAPTION>
DECEMBER 31, 1998
---------------------
ACTUAL PRO FORMA
-------- ---------
(IN MILLIONS)
<S> <C> <C>
Short-term debt............................................. $1,321.4 $ 336.0
-------- --------
Long-term debt:
Current portion of long-term debt......................... 376.7 376.7
Other long-term debt...................................... 1,717.9 1,717.9
Notes offered hereby...................................... -- 1,000.0
-------- --------
Total long-term debt................................... 2,094.6 3,094.6
-------- --------
Shareholders' equity........................................ 2,939.2 2,939.2
-------- --------
Total capitalization................................... $6,355.2 $6,369.8
======== ========
</TABLE>
DANA AND CONSOLIDATED SUBSIDIARIES
(INCLUDING DCC ON AN EQUITY BASIS)
<TABLE>
<CAPTION>
DECEMBER 31, 1998
---------------------
ACTUAL PRO FORMA
-------- ---------
(IN MILLIONS)
<S> <C> <C>
Notes payable, current:
Current portion of long-term debt......................... $ 225.8 $ 225.8
Other..................................................... 1,167.5 182.1
-------- --------
Total notes payable, current........................... 1,393.3 407.9
-------- --------
Long-term debt:
Medium term loans......................................... 745.0 745.0
Other long-term debt...................................... 401.9 401.9
Notes offered hereby...................................... -- 1,000.0
-------- --------
Total long-term debt................................... 1,146.9 2,146.9
-------- --------
Shareholders' equity........................................ 2,939.2 2,939.2
-------- --------
Total capitalization................................... $5,479.4 $5,494.0
======== ========
</TABLE>
S-4
<PAGE> 5
SELECTED FINANCIAL DATA
The first table below summarizes selected financial information for Dana
for the past five years. The second table presents the same information with DCC
included on an equity basis. You should read this information in conjunction
with the financial statements and notes appearing elsewhere in this supplement
or in the documents that we have incorporated by reference.
DANA AND CONSOLIDATED SUBSIDIARIES
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
--------------------------------------------------------
1994 1995 1996 1997 1998
-------- --------- --------- --------- ---------
(IN MILLIONS, EXCEPT RATIOS)
<S> <C> <C> <C> <C> <C>
STATEMENT OF INCOME
Net sales.................................. $8,843.3 $10,471.7 $10,978.8 $11,911.0 $12,463.6
Revenue from lease financing and other
income................................... 138.4 200.4 203.6 491.4 375.1
-------- --------- --------- --------- ---------
Total revenue......................... 8,981.7 10,672.1 11,182.4 12,402.4 12,838.7
Cost of sales.............................. 7,195.2 8,682.5 9,158.1 10,067.0 10,449.1
Selling, general and administrative
expenses................................. 1,080.0 1,053.0 1,112.0 1,152.2 1,122.5
Restructuring and integration.............. -- -- -- 327.6 117.7
Merger expenses............................ -- -- -- -- 49.6
Interest expense........................... 136.9 190.8 203.5 251.4 279.6
-------- --------- --------- --------- ---------
Income before income taxes............ 569.6 745.8 708.8 604.2 820.2
Estimated taxes on income.................. 214.3 259.1 238.5 293.8 315.6
-------- --------- --------- --------- ---------
Income before minority interest and
equity in earnings (losses) of
affiliates.......................... 355.3 486.7 470.3 310.4 504.6
Minority interest.......................... (30.2) (40.4) (32.8) (22.4) (7.9)
Equity in earnings (losses) of
affiliates............................... 24.2 (3.5) 13.4 32.1 37.4
Effect of change in accounting for post-
employment benefits...................... 2.6 -- -- -- --
-------- --------- --------- --------- ---------
Net income............................ $ 351.9 $ 442.8 $ 450.9 $ 320.1 $ 534.1
======== ========= ========= ========= =========
BALANCE SHEET DATA
Cash and cash equivalents.................. $ 166.0 $ 120.1 $ 271.5 $ 422.7 $ 230.2
Total assets............................... 6,701.1 7,813.7 8,522.4 9,511.1 10,137.5
Total debt................................. 2,077.9 2,841.8 3,187.8 3,482.8 3,416.0
Deferred employee benefits................. 1,109.9 1,096.2 1,048.1 1,019.7 1,063.4
Shareholders' equity....................... 1,739.8 2,063.0 2,434.7 2,602.4 2,939.2
OTHER DATA
EBIT (1)................................... $ 706.5 $ 936.6 $ 912.3 $ 855.6 $ 1,099.8
Depreciation and amortization.............. 274.8 327.4 376.6 450.3 487.7
EBITDA(3).................................. 981.3 1,264.0 1,288.9 1,305.9 1,587.5
Capital expenditures....................... 412.8 513.7 469.0 579.1 661.4
Ratio of earnings to fixed charges (2)..... 4.4x 4.3x 3.9x 3.1x 3.6x
Ratio of EBITDA to interest expense(3)..... 7.2x 6.6x 6.3x 5.2x 5.7x
Total debt to EBITDA (3)................... 2.1x 2.2x 2.5x 2.7x 2.2x
Total debt to total capitalization (4)..... 55% 58% 57% 57% 54%
</TABLE>
- ---------------
Notes (1) through (4) are found starting on page S-6.
S-5
<PAGE> 6
DANA AND CONSOLIDATED SUBSIDIARIES
(INCLUDING DCC ON AN EQUITY BASIS)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
--------------------------------------------------------
1994 1995 1996 1997 1998
-------- --------- --------- --------- ---------
(IN MILLIONS, EXCEPT RATIOS)
<S> <C> <C> <C> <C> <C>
STATEMENT OF INCOME
Net sales.................................. $8,836.9 $10,470.3 $10,978.8 $11,911.0 $12,463.6
Other income (expense)..................... (1.1) 45.1 27.1 297.8 59.7
-------- --------- --------- --------- ---------
Total revenue......................... 8,835.8 10,515.4 11,005.9 12,208.8 12,523.3
Cost of sales.............................. 7,201.7 8,701.8 9,182.6 10,098.6 10,485.1
Selling, general and administrative
expenses................................. 998.3 970.7 1,025.0 1,041.5 984.2
Restructuring and integration.............. -- -- -- 327.6 117.7
Merger expenses............................ -- -- -- -- 49.6
Interest expense........................... 77.8 120.0 129.1 172.6 188.9
-------- --------- --------- --------- ---------
Income before income taxes............ 558.0 722.9 669.2 568.5 697.8
Estimated taxes on income.................. 211.8 258.8 226.7 286.1 277.7
-------- --------- --------- --------- ---------
Income before minority interest and
equity in earnings of affiliates.... 346.2 464.1 442.5 282.4 420.1
Minority interest.......................... (30.2) (40.4) (32.8) (22.4) (7.9)
Equity in earnings of affiliates........... 33.3 19.1 41.2 60.1 121.9
Effect of change in accounting for post-
employment benefits...................... 2.6 -- -- -- --
-------- --------- --------- --------- ---------
Net income............................ $ 351.9 $ 442.8 $ 450.9 $ 320.1 $ 534.1
======== ========= ========= ========= =========
BALANCE SHEET DATA
Cash and cash equivalents.................. $ 96.8 $ 108.4 $ 267.9 $ 410.3 $ 226.6
Total assets............................... 5,663.7 6,707.6 7,299.4 8,146.7 9,051.5
Total debt................................. 1,110.7 1,784.4 2,023.1 2,196.0 2,540.2
Deferred employee benefits and other
noncurrent liabilities................... 1,149.2 1,127.6 1,072.3 1,123.3 1,179.8
Shareholders' equity....................... 1,739.8 2,063.0 2,434.7 2,602.4 2,939.2
OTHER DATA
EBIT (1)................................... $ 635.8 $ 842.9 $ 798.3 $ 741.1 $ 886.7
Depreciation and amortization.............. 227.8 269.0 315.1 380.6 395.9
EBITDA(3).................................. 863.6 1,111.9 1,113.4 1,121.7 1,282.6
Capital expenditures....................... 353.8 442.3 396.5 517.6 552.8
Ratio of earnings to fixed charges (2)..... 5.8x 5.4x 4.7x 3.6x 4.3x
Ratio of EBITDA to interest expense(3)..... 11.1x 9.3x 8.6x 6.5x 6.8x
Total debt to EBITDA(3).................... 1.3x 1.6x 1.8x 2.0x 2.0x
Total debt to total capitalization (4)..... 39% 46% 45% 46% 46%
</TABLE>
- ---------------
(1) EBIT represents earnings before interest expense, estimated taxes on income,
minority interest, equity in earnings (losses) of affiliates and the effects
of changes in accounting principles, and is not intended to represent an
alternative to operating income (as defined in accordance with generally
accepted accounting principles, "GAAP") as an indicator of our operating
performance or as an alternative to cash flows from operating activities (as
determined in accordance with GAAP) as a measure of liquidity. We understand
that while EBIT is frequently used to analyze companies, EBIT as presented
here is not necessarily comparable to what other companies state as "EBIT"
because of potential inconsistencies in the method of calculation.
S-6
<PAGE> 7
(2) These ratios were computed by dividing earnings by fixed charges. For this
purpose, "earnings" consist of income from continuing operations before
taxes, distributed income of affiliates accounted for on the equity method
of accounting, fixed charges (excluding capitalized interest) and income of
majority-owned subsidiaries with fixed charges, and "fixed charges" consist
of interest on indebtedness and that portion of rental expense (one third)
which we believe to be representative of interest.
(3) EBITDA represents earnings before interest expense, estimated taxes on
income, minority interest, equity in earnings (losses) of affiliates and the
effects of changes in accounting principles plus depreciation and
amortization, and is not intended to represent an alternative to operating
income (as defined in accordance with GAAP) or as an alternative to cash
flows from operating activities (as determined in accordance with GAAP) as a
measure of liquidity. We believe that EBITDA divided by total interest
expense and total debt divided by EBITDA are meaningful measures of
performance because they are commonly used in our industry to analyze
operating performance, leverage and liquidity. We understand that while
EBITDA is frequently used to analyze companies, EBITDA as presented herein
is not necessarily comparable to what other companies state as "EBITDA"
because of potential inconsistencies in the method of calculation.
(4) Total debt to total capitalization represents (i) total debt, divided by
(ii) total debt plus shareholders' equity.
S-7
<PAGE> 8
BUSINESS
GLOBAL ORGANIZATION
We have organized our operations into seven market-focused Strategic
Business Units, or SBUs, as follows:
Automotive Systems Group -- This group serves the world's light truck and
passenger car markets with Spicer(R) light duty axles and driveshafts, Parish(R)
structural products (such as engine cradles and frames), transfer cases,
original equipment brakes and integrated modules and systems. The group has 82
facilities and 21,100 people in 20 countries. In 1998, its sales were $4.3
billion and its three largest customers were DaimlerChrysler AG, Ford Motor
Company and General Motors Corporation.
Automotive Aftermarket Group -- Created in 1998 as one of our strategic
initiatives to realign our operations following the Echlin merger, this group
sells hydraulic brake components and disc brakes for light vehicle applications,
external engine components for the vehicle maintenance and repair markets and a
complete line of filtration products for a variety of vehicle and industrial
equipment applications worldwide. In addition, it sells electrical, brake, power
transmission, steering and suspension systems components in the United Kingdom
and continental Europe. The group has 175 facilities and 27,000 people in 24
countries. In 1998, its sales were $2.8 billion and its three largest customers
were National Automotive Parts Association or NAPA, Carquest Corporation and Pep
Boys Manny Moe & Jack.
Engine Systems Group -- This group serves the automotive, heavy truck,
agricultural, construction, mining, aeronautical, marine, railway, motorcycle
and industrial markets (including nearly every major engine manufacturer in the
world and related aftermarkets) with Victor Reinz(R) sealing products, Perfect
Circle(R) engine parts, Sealed Power(R) piston rings, cylinder liners and
camshafts and Echlin fluid system products. The group has 116 facilities and
20,500 people in 19 countries. In 1998, its sales were $2.0 billion and its
three largest customers were Ford, General Motors and DaimlerChrysler.
Heavy Truck Group -- This group, a major global supplier to the medium and
heavy truck markets, produces Spicer(R) heavy axles and brakes, trailer
products, medium and heavy duty driveshafts and Chelsea(R) power take-off units
and commercial vehicle systems. It also assembles modules and systems for heavy
trucks. The group has 47 facilities and 6,500 people in 9 countries. In 1998,
its sales were $1.6 billion and its three largest customers were Mack Trucks,
Inc., PACCAR Inc and Navistar International Transportation Corp.
Off-Highway Systems Group -- This group produces Spicer(R) axles and
brakes, transaxles, power-shift transmissions, torque converters and electronic
controls and Gresen(R) hydraulic pumps, motors, valves, filters and electronic
components for the construction, agriculture, mining, specialty chassis, outdoor
power, materials handling, forestry and leisure utility equipment markets. The
group has 18 facilities and 4,500 people in 8 countries. In 1998, its sales were
nearly $900 million and its three largest customers were Agco Corporation,
Caterpillar Inc. and Case Corporation.
Industrial Group -- Our most diverse core business, this group sells
products and systems that drive and control motion, including Warner Electric(R)
clutches, brakes, linear actuators, motors and controls, Boston(R) hose
products, Weatherhead(R) couplings and a wide range of electric and electronic
sensors. The group serves worldwide markets for industrial machinery processing
equipment, machine tools and business machines, as well as the communication,
information processing, transportation, agriculture, construction, mining,
chemical, petroleum and automotive industries. It has 47 facilities and 6,000
people in 16 countries. In 1998, its sales were over $700 million and its three
largest customers were Ford, NAPA and Motion Industries, Inc.
Leasing Services -- Dana Credit Corporation and its subsidiaries provide
leasing services to selected markets in the U.S., Canada, the United Kingdom and
continental Europe. DCC's key products are middle ticket and capital markets
leasing and finance products and asset and real property management. In the
fourth quarter of 1998, DCC sold its Technology Leasing Group, which provided
lease financing for personal computers and small office equipment, to Heller
Financial, Inc.
S-8
<PAGE> 9
PRODUCTS
As a result of our internal development and acquisition activities in the
past several years, we now have ten core products and services. During the past
three years, our sales by core product were as follows:
<TABLE>
<CAPTION>
PERCENTAGE OF
CONSOLIDATED SALES
--------------------
TYPE OF PRODUCTS 1996 1997 1998
- ---------------- ---- ---- ----
<S> <C> <C> <C>
Axle.................................................... 24% 25% 32%
Engine.................................................. 10 10 10
Brake................................................... 9 10 10
Driveshaft.............................................. 9 9 9
Fluid System............................................ 6 7 7
Structural.............................................. 6 7 6
Industrial.............................................. 7 6 6
Sealing................................................. 5 5 5
Filtration.............................................. 4 4 4
--- --- ---
Subtotal...................................... 80% 83% 89%
Others.................................................. 20 17 11
--- --- ---
Total......................................... 100% 100% 100%
=== === ===
</TABLE>
We do not consider our leasing service revenue to be sales and none of our
other products are core or account for 10% of sales.
SELECTED INTERNATIONAL INFORMATION
Our international subsidiaries and affiliates manufacture and sell a number
of vehicular and industrial products which are similar to those that we produce
in the United States. Our Strategic Business Units operate globally, and we
support them with administrative organizations in North America, Europe, South
America and Asia/Pacific. These regional organizations facilitate financial and
statutory reporting and tax compliance on a worldwide basis. In 1998, our
international sales were $3.7 billion, international net income was $180.5
million and equity in earnings from international affiliates was $30.4 million.
COMPETITION
We compete worldwide with a number of other manufacturers and distributors
which produce and sell similar products. These competitors include
vertically-integrated units of our major OE (original equipment) customers and a
number of independent U.S. and non-U.S. suppliers. Our traditional U.S. OE
customers, facing substantial foreign competition in the past few years, have
expanded their worldwide sourcing of components in order to better compete with
lower cost imports. In addition, these customers have been shifting research and
development, design and validation responsibilities to their Tier 1 suppliers,
focusing on stronger relationships with fewer suppliers. We have established
operations throughout the world to enable us to meet these competitive
challenges and be a strong global supplier of our core products.
In the area of leasing services, we compete in selected niche markets with
various international, national and regional leasing and finance organizations.
CUSTOMERS
We have thousands of customers worldwide and enjoy long-standing business
relationships with many of them. Only two customers, Ford and DaimlerChrysler
(including their global subsidiaries and affiliates), accounted for more than
10% of our consolidated net sales in 1998. Our sales to Ford were 14% of our
consolidated sales in 1996, 15% in 1997 and 15% in 1998. Our sales to
DaimlerChrysler were 11%, 11%
S-9
<PAGE> 10
and 13% of our consolidated sales in those years. The loss of all or a
substantial portion of our sales to these customers, or to other major vehicle
manufacturers, would have a significant adverse effect on our financial results
until the lost sales volume could be replaced. There would be no assurance, in
such event, when or if the lost volume would be replaced.
RESEARCH AND DEVELOPMENT
Our objective is to provide our vehicular and industrial customers with
technologically advanced products and systems at competitive prices. To enhance
quality and reduce costs, we use statistical process control, cellular
manufacturing, flexible regional production and assembly, global sourcing and
extensive employee training.
In addition, we engage in ongoing engineering, research and development
activities to improve the reliability, performance and cost-effectiveness of
existing products and to design and develop new products for existing and new
applications. Our spending on engineering, research and development and quality
control programs was $212.0 million in 1996, $248.4 million in 1997 and $274.9
million in 1998. We currently have 70 technology centers dedicated to
engineering and product development activities throughout the world. Our
research and engineering people work closely with many of our OEM customers on
special product and system designs in order to promote efficiency, reduce
development costs and enhance customer relationships.
MANUFACTURING, FACILITIES AND EMPLOYMENT
As shown in the following table, we have over 500 manufacturing,
distribution and service branch or office facilities worldwide. We own the
majority of our manufacturing and larger distribution facilities for vehicular
and industrial products. We lease a few manufacturing facilities and most of our
smaller distribution outlets and financial services branches and offices.
<TABLE>
<CAPTION>
FACILITIES BY REGION AT DECEMBER 31, 1998
------------------------------------------------
NORTH SOUTH ASIA/
TYPE OF FACILITY AMERICA EUROPE AMERICA PACIFIC TOTAL
- ---------------- ------- ------ ------- ------- -----
<S> <C> <C> <C> <C> <C>
Manufacturing.................................... 189 79 37 7 312
Distribution..................................... 59 22 13 20 114
Service Branches, Offices........................ 55 10 6 8 79
--- --- -- -- ---
Total....................................... 303 111 56 35 505
=== === == == ===
</TABLE>
Worldwide, our employment is 86,400 people. Within the United States, we
have over 47,100 employees, of whom approximately 31% are unionized.
S-10
<PAGE> 11
DESCRIPTION OF THE NOTES
The notes will be unsecured general obligations of Dana, ranking on a
parity with all our other unsecured and unsubordinated indebtedness which may be
outstanding from time to time. The "Description of Debt Securities" section in
the accompanying prospectus (including the covenants and the discharge and
defeasance provisions of the Indenture described therein) will apply to the
notes offered in this supplement, except as otherwise provided below or in the
Indenture and the Second Supplemental Indenture dated February 26, 1999,
designating the notes.
GENERAL
The notes will be limited to $1,000,000,000 in aggregate principal amount.
The 2004 notes will be limited to $250,000,000 in aggregate principal amount,
will mature on March 1, 2004, and will bear interest at the rate of 6.25% per
annum. The 2009 notes will be limited to $350,000,000 in aggregate principal
amount, will mature on March 1, 2009, and will bear interest at the rate of
6.50% per annum. The 2029 notes will be limited to $400,000,000 in aggregate
principal amount, will mature on March 1, 2029, and will bear interest at the
rate of 7.00% per annum.
Interest on the notes will be computed on the basis of a 360-day year of
twelve 30-day months, from the date of issuance or the most recent date on which
interest has been paid or for which interest has been provided. Interest will be
payable semi-annually on March 1 and September 1, commencing September 1, 1999,
to the persons in whose names the notes are registered at the close of business
on February 15 or August 15, as the case may be, preceding such interest payment
date. We will pay interest on any overdue principal and (to the extent that
payment of such interest is enforceable under applicable law) on any overdue
installment of interest at a rate of 1.00% per annum above the coupon rate for
each note, compounded semi-annually.
The notes will not be convertible into or exchangeable for our common or
preferred stock, will not be entitled to the benefit of any sinking fund and
will not be listed on any securities exchange.
BOOK-ENTRY SYSTEM, FORM AND DELIVERY
We will issue the notes in the form of one or more "global securities"
which will be registered in the name of a nominee of The Depository Trust
Company. For more detail on the global securities, see the "Description of Debt
Securities -- Global Securities" section in the accompanying prospectus. We will
issue the notes in denominations of U.S. $1,000 and integral multiples of U.S.
$1,000. The underwriters will pay for the notes in immediately available funds.
We will make all payments of principal and interest on the notes in immediately
available funds so long as the notes are maintained in book-entry form.
The Depository Trust Company will trade the notes in its "Same-Day Funds
Settlement System" and will require that any secondary trading activity in the
notes settle in immediately available funds. We can give no assurance as to the
effect, if any, of settlement in immediately available funds on trading activity
in the notes.
OPTIONAL REDEMPTION
We will have the right to redeem the notes at any time, in whole or in
part, upon at least 30 calendar days' notice by mail. We will pay a redemption
price equal to the sum of the principal amount of the notes being redeemed (plus
any interest that accrued before the redemption date) and any "make-whole
amount" (as described below) with respect to the notes. Interest installments on
a note specified to be due on or before such redemption date will be payable to
the holders of record on the relevant record date.
The make-whole amount means the amount by which (1) the aggregate present
value (as of the redemption date) of the principal being redeemed and the
remaining payments of interest (excluding the interest that accrued before the
redemption date) payable on that principal had the redemption not been made,
determined by discounting the principal and interest on a semi-annual basis at
the "reinvestment
S-11
<PAGE> 12
rate" (as described below) from the dates on which the principal and interest
would have been payable to the redemption date, exceeds (2) the aggregate
principal amount of the notes being redeemed.
The reinvestment rate is determined on the third business day before the
notice of redemption is given to participants and is equal to the "Treasury
Yield" plus 0.10% for the 2004 notes, 0.15% for the 2009 notes and 0.25% for the
2029 notes.
The Treasury Yield means the yield on Treasury securities at a constant
maturity corresponding to the remaining life to the stated maturity (as of the
redemption date, rounded to the nearest month) of the principal being redeemed.
The Treasury Yield will equal the arithmetic mean of the yields published in the
statistical release (identified below) under the heading "Week Ending" for "U.S.
Government Securities -- Treasury Constant Maturities" with a maturity equal to
such remaining life. If no published maturity exactly corresponds with such
remaining life, then we will interpolate or extrapolate the Treasury Yield on a
straight-line basis from the arithmetic mean of the yields for the next shortest
and next longest published maturities.
The statistical release is the release designated "H.15 (519)" or any
successor publication published weekly by the Board of Governors of the Federal
Reserve System which reports yields on actively traded United States government
securities adjusted to constant maturities. If no statistical release is
published at the time of any redemption of the notes or if the format or content
of the statistical release changes so as to preclude a determination of the
Treasury Yield in the above manner, we will designate a reasonably comparable
index. For calculating the reinvestment rate, we will use the most recent
statistical release published before the date of determination of the make-whole
amount.
If fewer than all the notes are to be redeemed, the Trustee will select the
particular notes or portions of the particular notes to be redeemed from the
outstanding notes not previously called by such method as it deems fair and
reasonable. The aggregate principal amounts to be redeemed must equal $1,000 or
any integral multiple thereof. The Trustee's selection must be made 30 to 60
days before the redemption date.
S-12
<PAGE> 13
UNDERWRITING
Subject to the Terms Agreement dated February 26, 1999, these underwriters
have agreed to purchase, and we have agreed to sell, the following principal
amounts of the notes:
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT PRINCIPAL AMOUNT PRINCIPAL AMOUNT
OF 2004 NOTES OF 2009 NOTES OF 2029 NOTES
UNDERWRITER ---------------- ---------------- ----------------
<S> <C> <C> <C>
Merrill Lynch, Pierce, Fenner & Smith
Incorporated.................... $103,750,000 $145,250,000 $166,000,000
BT Alex. Brown Incorporated.................. 16,250,000 22,750,000 26,000,000
Deutsche Bank Securities Inc................. 16,250,000 22,750,000 26,000,000
Donaldson, Lufkin & Jenrette Securities
Corporation................................ 16,250,000 22,750,000 26,000,000
First Chicago Capital Markets, Inc........... 16,250,000 22,750,000 26,000,000
J.P. Morgan Securities Inc. ................. 16,250,000 22,750,000 26,000,000
Lehman Brothers Inc.......................... 16,250,000 22,750,000 26,000,000
Morgan Stanley & Co. Incorporated............ 16,250,000 22,750,000 26,000,000
NationsBanc Montgomery Securities LLC........ 16,250,000 22,750,000 26,000,000
Salomon Smith Barney Inc..................... 16,250,000 22,750,000 26,000,000
------------ ------------ ------------
Total........................... $250,000,000 $350,000,000 $400,000,000
============ ============ ============
</TABLE>
The Terms Agreement provides that the underwriters' obligation to pay for
and accept delivery of the notes is subject to the approval of certain legal
matters by their counsel and to certain other conditions. The underwriters must
take and pay for all of the notes if any are taken.
The underwriters have advised us that they will initially offer the notes
to the public at the applicable public offering price set forth on the cover of
this prospectus supplement, and to certain dealers at such price less
concessions not in excess of .35% of the aggregate principal amount of the 2004
notes, .4% of the aggregate principal amount of the 2009 notes and .5% of the
aggregate principal amount of the 2029 notes. The underwriters may allow, and
such dealers may reallow, discounts not in excess of .25% of the aggregate
principal amount of each of the notes to certain other dealers. After the
initial public offering of the notes, the public offering price, concession and
discount may be changed.
We have agreed to indemnify the underwriters against certain liabilities,
including liabilities under the Securities Act of 1933, as amended.
We do not intend to list the notes on any national securities exchange, but
have been advised by the underwriters that they presently intend to make a
market in the notes as permitted by applicable laws and regulations. However,
the underwriters are not obligated to make a market in the notes, and they may
discontinue such market-making at any time at their sole discretion.
Accordingly, we can give no assurance as to the liquidity of or trading markets
for the notes. The underwriters do not intend to confirm sales to accounts over
which they exercise discretionary authority.
To facilitate the offering of the notes, the underwriters may (but are not
required to) engage in transactions that stabilize, maintain or otherwise affect
the note prices, including bidding for and purchasing the notes in the open
market. These activities may stabilize or maintain the market prices for the
notes above market levels. Such transactions, if commenced, may be discontinued
at any time.
All the underwriters or their affiliates provide investment banking and/or
commercial banking services to us from time to time. As stated in the "Use of
Proceeds" section, a portion of the net proceeds will be used to repay the
interim financing associated with the acquisition of the Glacier Vandervell
bearings and the AE Clevite aftermarket engine hard parts businesses. The
commercial banking affiliates of BT Alex. Brown Incorporated, Deutsche Bank
Securities Inc., First Chicago Capital Markets, Inc., NationsBanc Montgomery
Securities LLC and Salomon Smith Barney Inc. participated in providing the
interim financing and, accordingly, will each receive a portion of the net
proceeds from this offering.
LEGAL MATTERS
Certain legal matters in connection with the sale of the notes, including
with respect to their legality, will be passed upon for us by Rosenman & Colin
LLP, 575 Madison Avenue, New York, New York 10022 and for the underwriters by
Wachtell, Lipton, Rosen & Katz, 51 West 52nd Street, New York, New York 10019.
Wachtell, Lipton, Rosen & Katz performs legal services for us from time to time
as well.
S-13
<PAGE> 14
PROSPECTUS
DANA CORPORATION
4500 Dorr Street
Toledo, Ohio 43615
(419) 535-4500
$750,000,000
COMMON STOCK
DEBT SECURITIES
This prospectus also covers $250,000,000 of securities remaining available under
an earlier registration statement covering $600,000,000 of securities.
- --------------------------------------------------------------------------------
We will provide specific terms of these securities in supplements to this
prospectus.
You should read this prospectus and any supplements carefully before you invest.
- --------------------------------------------------------------------------------
The common stock is listed on the New York, Pacific and London Stock Exchanges
under the symbol "DCN."
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
This prospectus is dated December 30, 1998
<PAGE> 15
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission (the "SEC") using a "shelf" registration
process. Under this process, we may sell any combination of the securities
described in this prospectus in one or more offerings up to a total dollar
amount of $750,000,000. This prospectus provides you with a general description
of the securities we may offer. Each time we sell any of these securities, we
will provide a supplement to this prospectus that will contain specific
information about the terms of that offering. The supplement may also add,
update or change the information contained in this prospectus. You should read
this prospectus and the supplements together with the additional information
described under the heading "Where You Can Find More Information."
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. These filings are available to the public over the
Internet at the SEC's web site at http://www.sec.gov. You may also read and copy
any document we file at the SEC's Public Reference Rooms in Washington, D.C.,
New York, New York and Chicago, Illinois. The Public Reference Room in
Washington, D.C. is located at 450 Fifth Street, N.W. Please call the SEC at
1-800-SEC-0330 for further information on the Public Reference Rooms.
Our common stock is listed on the New York Stock Exchange, 20 Broad Street,
New York, New York 10005; The Pacific Stock Exchange, 301 Pine Street, San
Francisco, California 94104; and The International (London) Stock Exchange,
London EC2N 1HP. Reports, proxy statements and other information concerning Dana
can be reviewed at these exchanges.
The SEC allows us to incorporate into this prospectus information that we
have filed with it or will file in the future. This means that we can disclose
important information to you by referring you to our SEC filings. Information
that we file later with the SEC will automatically update and supersede the
information in this prospectus. We are incorporating into this prospectus the
documents listed below and any future filings made with the SEC under Sections
13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934 until we have
sold all of the securities:
- Our Annual Report on Form 10-K for the year ended December 31, 1997
(except for the consolidated financial statements for the three years
then ended, which we are incorporating instead by reference to our
Current Report on Form 8-K filed on November 10, 1998);
- Our Quarterly Reports on Form 10-Q for the quarters ended March 31 and
June 30 (which contain information that has not been restated as a
result of our merger with Echlin Inc., effective as of July 9, 1998) and
September 30, 1998;
- Our Current Reports on Form 8-K, filed on May 4, July 9, September 3
(Form 8-K/A), September 18 and November 10, 1998;
- The description of our common stock contained in Form 8-A dated on or
about July 12, 1946, and all amendments thereto and reports filed for
the purposes of updating such description; and
- The description of our preferred share purchase rights contained in Form
8-A, dated May 1, 1996.
You may request a copy of these filings at no cost, by writing or
telephoning:
Martin J. Strobel
Secretary
Dana Corporation
P.O. Box 1000
Toledo, Ohio 43697
(419) 535-4500
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<PAGE> 16
As noted above, we have also filed a registration statement with the SEC
under the Securities Act of 1933 to register the securities covered by this
prospectus. You should read that registration statement for additional
information about Dana and the securities.
You should rely only on the information contained in this prospectus, any
supplement to it and the SEC filings that we have incorporated by reference. We
have not authorized anyone else to provide you with different information. We
are not offering the securities in any state where the offer is not permitted.
You should not assume that the information in this prospectus or any supplement
is accurate as of any date other than the date on the front of those documents.
THE COMPANY
Dana Corporation was founded in 1904 as the first supplier of universal
joints to the automotive industry. Today, we are an international leader in the
design, manufacture and marketing of a broad range of products for worldwide
vehicular and industrial markets. References to Dana in this prospectus include
our consolidated subsidiaries unless the context indicates otherwise.
In the vehicular market, we sell original equipment and aftermarket
components and assemblies for light, medium and heavy trucks, sport utility
vehicles, trailers, vans and automobiles. Our products include:
- drivetrain components, including axles, driveshafts and structural
components;
- engine parts, including gaskets and sealing systems, piston rings,
condensers, distributors, ignition coils, and filtration products;
- structural components, including vehicle frames, engine cradles and
rails;
- chassis products, including steering and suspension components;
- brake parts, including hydraulic brake master cylinders, new and
remanufactured brake shoes, drums, and disc pads; and
- other parts manufactured primarily for original equipment manufacturers,
including power steering pumps, coupled hose systems and heavy duty
windshield wiper systems.
In the industrial market, we sell products for off-highway vehicle and
stationary equipment applications. These include components for industrial power
transmission products (such as electrical and mechanical brakes and clutches,
drives and motion control devices) and components for fluid power systems (such
as pumps, cylinders and control valves).
In addition, through our subsidiary Dana Credit Corporation, we provide
leasing and financial services to selected markets in North America and Europe.
In July 1998, we merged one of our subsidiaries with Echlin Inc., another
worldwide supplier of automotive products. Before the merger, we had reported
sales of $8.3 billion for 1997. Because we are accounting for the merger as a
pooling of interests, we now report combined 1997 sales of $11.9 billion. Unless
otherwise indicated, the information in this prospectus describes the combined
entity.
The Echlin merger was one of a series of steps we have taken in the past
two years to focus on and strengthen our core products and businesses. During
that period, we completed strategic acquisitions of operations with annualized
sales of $4.9 billion, including the Clark-Hurth Components assets of Ingersoll-
Rand Company, the Sealed Power Division of SPX Corporation, the heavy axle and
brake business of Eaton Corporation, and Echlin. We also completed significant
restructuring and rationalization, including the sale of our European
distribution operations and other operations not core to our business.
These actions have helped us toward two goals which we have been pursuing
for some time. First, we have increased the portion of our sales represented by
non-highway vehicle production for original equipment manufacturers and are
closer to a balance between our sales to vehicle original equipment
manufacturers (now approximately 55%) and our sales to the distribution,
off-highway, service and
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<PAGE> 17
industrial markets (now approximately 45%). Second, we have improved the balance
between our U.S. and international sales and now obtain approximately 36% of our
sales (including exports) from customers outside the U.S.
We expect the Echlin merger to support our growth objectives in other
respects as well. With aftermarket brake parts, we believe we have a product
that has above-industry growth prospects because of superior performance (due to
new technology and materials) and a shorter product life than traditional brake
components. Our leading portfolio of branded products will be especially
important for our entry into emerging international markets. And, we can now
integrate brake system components, vehicle fluid handling systems and electronic
ignition and engine management systems with our drivetrain and engine systems
product lines.
To serve our global markets, we have seven strategic business
units -- Automotive Systems Group, Automotive Aftermarket Group, Engine Systems
Group, Heavy Truck Group, Off-Highway Systems Group, Industrial Group and Dana
Commercial Credit -- and regional administrative organizations in North America,
Europe, South America and Asia/Pacific.
USE OF PROCEEDS
We currently plan to issue unsecured senior debt in the public market in
the first quarter of 1999 and to use the net proceeds from the sale to refinance
bridge financing arranged for the acquisition of the Glacier Vandervell bearings
and AE Clevite aftermarket engine hard parts businesses and to refinance a
portion of our short term debt.
We plan to use the net proceeds from any other securities which we sell
under this prospectus for general corporate purposes, including working capital,
capital expenditures, acquisitions, and the repayment or refinancing of debt.
Each time we sell any of the securities, we will provide a supplement containing
information about how we intend to use the net proceeds from that particular
sale.
RATIO OF EARNINGS TO FIXED CHARGES
The following are our consolidated ratios of earnings to fixed charges for
the periods indicated:
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
YEAR ENDED DECEMBER 31 SEPTEMBER 30
------------------------------------ ------------
1993 1994 1995 1996 1997 1997 1998
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Consolidated ratio of earnings to fixed
charges.................................. 3.0x 4.4x 4.3x 3.9x 3.1x 3.1x 3.7x
</TABLE>
We computed these ratios by dividing our earnings by our fixed charges. For
this purpose, "earnings" means income from continuing operations before taxes,
distributed income of less than 50% owned affiliates, fixed charges (excluding
capitalized interest) and income of majority-owned subsidiaries with fixed
charges, and "fixed charges" means interest on indebtedness and that portion of
rental expense (one third) which we believe to be representative of interest.
DESCRIPTION OF CAPITAL STOCK
The following is a summary only. For more detailed information, see our
Restated Articles of Incorporation, By-Laws, and, with respect to the preferred
share purchase rights, our Rights Agreement. Copies of these documents have been
filed with the SEC.
COMMON STOCK
Under our Restated Articles of Incorporation, we are authorized to issue
350,000,000 shares of common stock with a $1 par value. Currently, we have
approximately 165,500,000 shares of common stock
4
<PAGE> 18
issued and outstanding, and approximately 15,200,000 shares reserved for
issuance under our various employee and director stock plans. The shares of
common stock currently outstanding are fully paid and non-assessable. Any shares
offered under a supplement to this prospectus will also be fully paid and
non-assessable upon our receipt of full consideration for the shares.
Our common stockholders are entitled to receive dividends in such amounts
per share as our Board of Directors may declare.
They are also entitled to one vote per share on all matters submitted to a
vote of the stockholders. The common stock is the only voting class of our
capital stock of which shares are currently issued and outstanding. As these
shares do not carry cumulative voting rights in electing directors, if there is
a quorum present or represented at a meeting at which directors are to be
elected, the holders of more than 50% of the shares voting will elect all of the
directors and the holders of less than 50% of the shares voting will not elect
any directors.
If Dana is liquidated or dissolved for any reason, our common stockholders
will receive equal shares of our assets which are available for distribution to
them after payment of all of our liabilities and any liquidation preferences
granted to our preferred stockholders.
Our common stock is not convertible, does not have any sinking fund,
preemptive or other subscription rights, and is not subject to redemption.
PREFERRED STOCK
Under our Restated Articles of Incorporation, we are authorized to issue up
to 5,000,000 shares of preferred stock. There is currently no preferred stock
outstanding.
Our Board of Directors has the authority:
- to issue preferred stock in one or more series;
- to fix the number of shares of each series, its particular designation,
its liquidation preference, and the rate of dividends to be paid; and
- to determine whether dividends will be cumulative, whether shares of the
series will have voting rights or be redeemable, and whether the
particular series will be entitled to a sinking fund or to conversion
rights.
If we issue preferred stock, the amount of funds available for the payment
of dividends on our common stock will be reduced by the dividend obligation that
the Board fixes for the preferred stock. Our preferred stockholders will also
have preferential treatment over our common stockholders in the event of Dana's
liquidation. When issuing preferred stock, our Board may grant voting rights to
the preferred stockholders which dilute the voting power of the common
stockholders.
JUNIOR PARTICIPATING PREFERRED STOCK AND PREFERRED SHARE PURCHASE RIGHTS
In connection with our Rights Agreement, dated April 25, 1996, our Board
authorized the creation of a Series A junior participating preferred stock.
The number of shares constituting this series of junior preferred stock is
1,000,000. Shares of this series are issuable only upon the exercise of
preferred share purchase rights, in the amount of one purchase right for each
share of our common stock. Subject to the provisions of the Rights Agreement,
until the earlier of July 25, 2006, or the redemption of the purchase rights,
the holder of each purchase right is entitled to buy one 1/1000th of a share of
the junior preferred stock at an exercise price of $110, subject to adjustment.
The purchase rights are redeemable at a price of $0.01 each at any time before
any person or entity acquires beneficial ownership of 15% or more of our
outstanding common stock. If any person (or entity) announces that he (or it)
has acquired beneficial ownership of 15% or more of our common stock or
commences, or announces an intention to commence, an offer which would result in
his (or its) beneficially owning 15% or more of our common stock, separate
certificates for the purchase rights will be
5
<PAGE> 19
mailed to our common stockholders and the purchase rights will become
exercisable and transferable apart from the common stock.
If, without the approval of our Board, Dana is acquired in a merger or
similar transaction or 50% of our assets or earning power are transferred to
another company, the holder of each purchase right may purchase a number of
shares of the acquiring company's common stock with a market price equal to
twice the current exercise price of the purchase right. If 15% (but less than
50%) of our common stock is acquired by any person or entity, our Board may
exchange each purchase right for one share of our common stock. In these
situations, the purchase rights owned by any person or entity holding 15% or
more of our common stock become void and cannot be exercised.
If issued, the junior preferred stock will be entitled to a cumulative
preferential quarterly dividend per share equal to the greater of $10 or 100
times the dividend declared on shares of our common stock. The junior preferred
stock is redeemable in whole at our option at a cash price per share of the
greater of $100 or 100 times the current market price (as defined in the Rights
Agreement) of our common stock. If Dana is liquidated, the junior preferred
stockholders will be entitled to receive an amount equal to accrued and unpaid
dividends plus an amount per share equal to the greater of $100 or 100 times the
payment made per share to our common stockholders. Each share of junior
preferred stock will be entitled to 100 votes, voting together with the common
stockholders on all matters submitted to the vote of stockholders. In the event
of any merger, consolidation or other transaction in which common stock is
exchanged, the holder of each share of junior preferred stock will be entitled
to receive 100 times the amount and type of consideration paid per share of our
common stock. The rights of the junior preferred stockholders as to dividends
and liquidations, their voting rights, and their rights in the event of mergers
and consolidations, are protected by customary anti-dilution provisions.
The purchase rights have anti-takeover effects. Among other things, they
may cause substantial dilution to a person or group that attempts to acquire
Dana on terms not approved by our Board, except pursuant to an offer conditioned
on a substantial number of purchase rights being acquired. The purchase rights
should not interfere with any merger or other business combination approved by
our Board before any person or entity has acquired ownership of 15% or more of
our common stock.
VIRGINIA LAW
Dana Corporation is a Virginia corporation and is subject to Article 14
(the "Affiliated Transactions Statute") and Article 14.1 (the "Control Share
Statute") of the Virginia Stock Corporation Act.
Pursuant to the Affiliated Transactions Statute, a Virginia corporation may
not engage in an affiliated transaction with a 10% stockholder or his affiliates
for three years following the 10% acquisition unless the transaction is approved
by a majority of the disinterested directors of the corporation and two-thirds
of the shares not owned by the 10% holder. An affiliated transaction means one
of the following transactions that has not been approved previously by the
corporation's board of directors: a merger, a share exchange, a sale of assets
with a fair market value in excess of 5% of the corporation's consolidated net
worth, a dissolution of the corporation and certain securities transactions. The
10% holder may effect an affiliated transaction after the three-year period only
if (i) the transaction is approved by two-thirds of the shares not owned by such
holder or a majority of the disinterested directors or (ii) the aggregate
consideration to be paid in the transaction meets certain fair price criteria. A
corporation may opt out of this provision by an amendment to its articles of
incorporation or by-laws approved by the majority of the outstanding shares of
stock not owned by the 10% holder. Dana has not opted out of this provision.
Pursuant to the Control Share Statute, if a person acquires shares entitled
to vote on the election of directors within one of the ranges set by the statute
(20% or more and less than one-third, one-third or more but less than a
majority, or a majority), that person automatically loses the right to vote the
shares that fall within such range. The affected person can demand a meeting of
stockholders to vote on whether his disqualified shares will have voting rights.
The voting rights of the disqualified shares can be restored by the affirmative
vote of a majority of "disinterested shares" at such a stockholders meeting.
"Disinterested shares" means all outstanding shares except those held by the
affected person and by the
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<PAGE> 20
corporation's officers and employee-directors. A corporation can opt out of the
Control Share Statute by amendment to its articles or by-laws, and Dana has done
so.
DESCRIPTION OF DEBT SECURITIES
The following is a summary of the material terms under which we expect to
offer our debt securities. The terms of the particular debt securities offered
by any supplement will be contained in that supplement.
GENERAL
The debt securities will be issued under the Indenture for Senior
Securities dated as of December 15, 1997, between Dana and Citibank, N.A., the
Trustee, any supplements to that indenture, and any succeeding indenture(s) and
supplement(s) between Dana and Citibank, N.A. The terms of the debt securities
will include those stated in the applicable indenture and supplement and those
made a part of the indenture by reference to the Trust Indenture Act of 1939.
The indenture provides for the issuance of our debt securities in an
unlimited amount from time to time in one or more series. The indenture does not
limit the amount of debt, either secured or unsecured, which we may issue under
the indenture or otherwise.
The prospectus supplement relating to any particular debt securities
offered will describe the following terms:
- the title of the securities;
- the price (expressed as a percentage of the aggregate principal amount)
at which the securities will be issued;
- any limit upon the aggregate principal amount of the securities;
- the date(s) on which the securities will mature and any provisions for
extending such date(s);
- the rate(s) (which may be fixed or variable) per annum at which the
securities will bear interest (if any), or the manner in which such
rate(s) will be determined;
- the date(s) from which any interest will accrue and on which such
interest will be payable, and any regular record dates for determining
the holders to whom such interest will be payable;
- the place(s) where the principal of and any premium and interest on the
securities will be payable;
- any obligation or right which we may have to redeem, repurchase or repay
any or all of the securities under any sinking fund or like provisions,
at our option or that of the holders, and the price(s) at which,
period(s) within which, and terms upon which the securities will be
redeemed, repurchased or repaid under such obligation;
- the denominations in which the securities will be issued (if other than
U.S. $1,000 and any integral multiple thereof);
- the currency or composite currency in which payment of the principal of
and any premium and interest on the securities will be payable (if other
than United States currency);
- whether the securities will be issued in the form of one or more
permanent global securities (as defined below) and, if so, the identity
of the depository for the same;
- the portion of the principal amount of the securities which will be
payable upon declaration of the acceleration of its maturity (if other
than the principal amount);
- any additions to or changes in the covenants or events of default set
forth below which will apply to the securities;
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<PAGE> 21
- any conversion or exchange provisions; and
- any other terms of the securities (which terms will be consistent with
the applicable indenture).
Unless otherwise set forth in the applicable prospectus supplement, the
debt securities will be issued only in fully registered form without coupons, in
denominations of U.S. $1,000 or any integral multiple thereof (or comparable
integral multiples in foreign currency). If the securities are offered or
payable in any foreign currency, the supplement will contain relevant
information about the foreign currency units, restrictions, elections, tax
consequences, and any other special information about the securities.
If the debt securities are issued at a discount from their principal
amount, the supplement will describe any relevant federal income tax or other
special considerations.
Unless otherwise set forth in the supplement, the principal of and any
premium and interest on the debt securities will be payable, and the exchange
and transfer of the securities will be registerable, at the office of the
Trustee or any other office or agency which we maintain for such purpose,
subject to any limitations in the indenture. No service charge will be made for
any registration of transfer or exchange of the securities, but we may require
payment of a sum sufficient to cover any tax or other governmental charge
imposed in connection with the transfer or exchange.
RANKING
We currently intend to issue the debt securities as unsecured and
unsubordinated debt ranking "pari passu" (of the same ranking or priority) with
all other unsecured and unsubordinated debt of Dana.
If we decide to issue any or all of the securities as subordinated debt
securities, the prospectus supplement will set forth the terms of any indenture
that may apply and the rights of the holders of such subordinated debt
securities.
CONVERSION AND EXCHANGE
If the debt securities are convertible into or exchangeable for common
stock, preferred stock, property or cash, the prospectus supplement will set
forth the terms of conversion or exchange, including whether such conversion or
exchange is mandatory or at our option or that of the holders. If applicable,
the supplement will also set forth the factors and time for calculating the
number of shares of common stock or preferred stock to be received by the
holders of the debt securities upon conversion or exchange.
GLOBAL SECURITIES
We may issue any or all of the debt securities in the form of "global
securities" (securities in which designated participants have beneficial
ownership interests but which are held and registered in the name of a
depository or its nominee).
While the identity of the depository and the specific terms of the
depository arrangement for any series of debt securities will be described in
the prospectus supplement, we anticipate that the following provisions will
apply to all depository arrangements.
Upon the issuance of a global security, the depository or nominee will
credit the principal amount of the debt securities represented by the global
security on its book-entry registration and transfer system. Such accounts will
be designated by the underwriters or agents or by Dana if we are offering the
debt securities directly.
Ownership of beneficial interests in the global security will be limited to
the designated participants and persons that may hold interests through such
participants. Such ownership will be shown on, and the transfer of that
ownership will be effected only through, records maintained by the depository or
nominee (with respect to interests of the participants) and records of the
participants (with respect to interests of persons other than the participants).
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The laws of some states may require that certain purchasers of securities
take physical delivery of the securities in definitive form (that is, in the
form of certificates registered in their names), and such laws may impair the
ability to transfer beneficial interests in a global security.
So long as either the depository or the nominee is the registered owner of
the global security, it will be considered the sole owner or holder of the debt
securities represented by the global security for all purposes under the
applicable indenture.
Except as provided below, owners of beneficial interests in the global
security will not be entitled to have the debt securities registered in their
names, will not receive or be entitled to receive physical delivery of
securities in definitive form, and will not be considered the owners or holders
of the securities under the applicable indenture.
The principal of and any premium and interest on the debt securities
registered in the name of the depository or the nominee will be paid to it as
the registered owner of the global security. Dana, the Trustee, the paying
agent(s) and the registrar(s) for the debt securities will have no
responsibility or liability for the records relating to or the payments made on
account of persons with beneficial ownership interests in the global security
(including maintaining or reviewing any records relating to such interests).
We expect that the depository or the nominee, upon receipt of any payment
of the principal of or any premium and interest with respect to the debt
securities, will credit the participants' accounts immediately with payments in
amounts proportionate to their respective beneficial interests in the principal
amount of the global security, as shown on the depository's or nominee's
records. We also expect that payments by participants to owners of beneficial
interests in the global security held through such participants will be governed
by standing instructions and customary practices (as is now the case with
securities held for the accounts of customers registered in "street name") and
will be the responsibility of such participants.
If the depository is at any time unwilling or unable to continue as
depository and we do not appoint a successor depository within 90 days, we will
issue the debt securities in definitive form in exchange for the global security
representing them. Further, if we so specify, an owner of a beneficial interest
in the global security may receive the debt securities in definitive form, on
terms acceptable to us and to the depository or nominee. In such case, the owner
of the beneficial interest will be entitled to physical delivery in definitive
form of debt securities equal in principal amount to its beneficial interest and
to have such securities registered in its name. The debt securities will be
issued in denominations of U.S. $1,000 and integral multiples thereof, unless we
specify otherwise.
COVENANTS
Limitations on Liens
Except with respect to indebtedness between us and any of our "restricted
subsidiaries," we covenant not to incur or guarantee (or to permit our
"restricted subsidiaries" to incur or guarantee) any "secured debt" without
equally and ratably securing the debt securities offered by this prospectus.
Unless designated as "unrestricted," all of our subsidiaries are "restricted
subsidiaries." Currently, there are no "unrestricted" subsidiaries.
"Secured debt" means indebtedness which is secured by:
- a lien on our "principal property" or that of a restricted subsidiary;
- a lien on the stock or indebtedness of a restricted subsidiary; or
- a restricted subsidiary's guarantee of our indebtedness.
"Principal property" means any real property currently owned or hereafter
acquired by us or any restricted subsidiary, including buildings and
improvements (other than any pollution control, cogeneration and small power
production facilities), which has a book value in excess of 2% of our
"consolidated net tangible assets" (that is, the total assets, less applicable
reserves and other properly deductible items, on
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our balance sheet for the most recent fiscal quarter, less all current
liabilities and goodwill, trade names, patents, organization expenses and other
like intangibles).
This covenant is not applicable to:
- secured debt existing at the date of the indenture;
- liens on real or personal property acquired, constructed or improved by
us or a restricted subsidiary after the date of the indenture which are
created contemporaneously with, or within 12 months after, the
acquisition, construction or improvement to secure all or any part of
the purchase price of the property or the cost of the construction or
improvement;
- mortgages on our property or that of a restricted subsidiary created
within 12 months of the completion of construction or improvement of any
new plant(s) on such property to secure the cost of the construction or
improvement;
- liens on property existing when we or a restricted subsidiary acquired
it;
- liens on the outstanding shares or indebtedness of a corporation
existing when that corporation becomes our subsidiary;
- liens on stock (except stock of our subsidiaries) acquired after the
date of the indenture if the aggregate cost of the acquisition does not
exceed 15% of our consolidated net tangible assets (as defined above);
- liens securing indebtedness of a successor corporation to us to the
extent permitted by the indenture;
- liens securing indebtedness of a restricted subsidiary when it became
such;
- liens securing indebtedness of any entity outstanding when it merged
with, or substantially all of its properties were acquired by, us or a
restricted subsidiary;
- liens created, incurred or assumed in connection with an industrial
revenue bond, pollution control bond or similar financing arrangement
between us or a restricted subsidiary and any federal, state or
municipal government or other governmental body or quasi-governmental
agency;
- liens in connection with government or other contracts to secure
progress or advance payments;
- liens in connection with taxes or legal proceedings to the extent such
taxes or proceedings are being contested or appealed in good faith or
are incurred for the purpose of obtaining a stay or discharge in the
course of such proceedings;
- liens consisting of mechanics' or materialmen's or similar liens
incurred in the ordinary course of business and easements, rights of
way, zoning restrictions, restrictions on the use of real property and
defects and irregularities in title thereto;
- liens made in connection with or to secure payment of workers'
compensation, unemployment insurance, or social security obligations;
- liens in connection with any "sale and leaseback transaction" (an
arrangement with any person or entity providing for the leasing by us or
a restricted subsidiary of any principal property, whereby we or the
subsidiary has or will sell or transfer such property to such person or
entity, excluding arrangements involving a lease for a term (including
renewal rights) of not more than three years) which is not subject to
the limitations described below under "Limitations on Sale and
Leaseback";
- mortgages to secure debt of a restricted subsidiary to us or to another
restricted subsidiary; and
- extensions, renewals or replacements of the foregoing permitted liens to
the extent of the original amounts of such liens.
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In addition, we and our restricted subsidiaries may secure debt which would
not otherwise be permitted or excepted without equally and ratably securing the
debt securities offered hereunder, if the sum of such secured debt plus the
aggregate value of any sale and leaseback transactions subject to the
limitations described below does not exceed 15% of our consolidated net tangible
assets (as defined above).
Limitations on Sale and Leaseback
We covenant not to engage in any sale and leaseback transactions involving
any principal property which we or any restricted subsidiary own currently or
acquire hereafter, or to permit any restricted subsidiary which has been in
operation for more than 180 days to do so, unless:
- we or the subsidiary would be entitled to incur secured debt on such
principal property equal to the amount realizable upon such sale or
transfer as if such amount were secured by a mortgage, without equally
and ratably securing the debt securities offered hereunder; or
- an amount equal to the greater of the net proceeds of the sale or the
fair value of the principal property is applied within 180 days either
to (a) the retirement of any indebtedness which under generally accepted
accounting principles would appear as debt on our consolidated balance
sheet and which matures by its terms or at the option of the obligor
more than 12 months from the date of the determination thereof, or (b)
the purchase of other principal property having a value at least equal
to the greater of such amounts; or
- the sale and leaseback transaction involves an industrial revenue bond,
pollution control bond or other similar financing arrangement between us
or any restricted subsidiary and any federal, state or municipal
government or other governmental or quasi-governmental body or agency.
Payment of Taxes
We covenant to pay, before they become delinquent:
- all taxes and other government charges levied on us or any of our
subsidiaries or on our income, profits or property or that of any of our
subsidiaries; and
- all lawful claims for labor, material and supplies which, if unpaid,
might become a lien and have a material adverse effect on us and our
subsidiaries taken as a whole.
However, we will not be required to pay taxes, assessments or charges if
the amount, applicability or validity of the same is being contested in good
faith by appropriate proceedings.
Existence
We covenant to do all things necessary to keep our existence, rights and
franchises in full force and effect, and to cause our subsidiaries to do the
same. However, neither we nor any of our subsidiaries will be required to
preserve any right or franchise (or, in the case of a subsidiary, its existence)
if we determine that the same is no longer desirable in the conduct of our
business and that the loss or termination of the same will not result in a
material adverse effect upon us and our subsidiaries taken as a whole.
Compliance with Laws
We covenant that we will comply with all applicable federal, state, local
and foreign laws, rules, regulations and ordinances, and will cause our
subsidiaries to do the same, in each case to the extent that the failure to so
comply would have a material adverse effect upon us and our subsidiaries taken
as a whole.
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EVENTS OF DEFAULT
Unless otherwise set forth in the applicable prospectus supplement, the
following will be events of default under the indenture with respect to any
series of debt securities:
- a default for 30 days in the payment of any interest on the securities
when due;
- the failure to pay the principal of or any premium on the securities
when due;
- the failure to deposit any mandatory sinking fund installment with
respect to the securities when due;
- the failure to observe or perform any other covenant in the indenture
applicable to the securities (other than a covenant included in the
indenture for the benefit of another series of debt securities)
continuing 60 days after notice from the Trustee;
- our default on other indebtedness of over $100 million, after the
applicable grace period, which results in such indebtedness becoming due
prior to its maturity;
- certain events of bankruptcy, insolvency or reorganization; and
- any other event of default specified in the supplement.
The indenture provides that, upon the occurrence of an event of default
(after expiration of any applicable grace period), the Trustee or the holders of
25% of the aggregate principal amount of the outstanding debt securities of any
series may declare the principal amount of and any accrued but unpaid interest
on such securities immediately due and payable. A bankruptcy default accelerates
the maturity of the securities automatically. After any such acceleration, the
holders of a majority of the aggregate principal amount of the outstanding debt
securities may rescind and annul such declaration before a judgment or decree
for payment of money has been obtained if we pay all amounts that would have
been due.
The indenture provides that within 90 days after the occurrence of an event
of default with respect to any series of debt securities, the Trustee will
notify the holders of the securities of all uncured and unwaived defaults known
to it (including events which, after notice or lapse of time, will become events
of default). However, except in the case of default in the payment of the
principal of, any premium or interest on, or any mandatory sinking fund
installment on, such debt securities, the Trustee will be protected in
withholding such notice if it determines in good faith that doing so is in the
best interest of such holders.
The indenture provides that the holders of a majority of the aggregate
principal amount of any series of outstanding debt securities will have the
right to direct the time, method and place for conducting any proceeding for any
remedy available to the Trustee, or exercising any power or trust conferred on
the Trustee, in accordance with applicable law and the provisions of the
indenture.
If an event of default is continuing, the Trustee will exercise its rights
and powers under the indenture and use the same degree of skill and care in such
exercise as a prudent person would use under the circumstances in the conduct of
his own affairs. However, the Trustee will not be obligated to exercise its
rights or powers under the indenture at the request of the holders of the debt
securities unless they have offered the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which it may incur in compliance
with such request.
Unless otherwise provided in the indenture, the holders of a majority of
the aggregate principal amount of the outstanding debt securities, acting on
behalf of all holders of such securities, may waive:
- any past default under the indenture (except a default in the payment of
the principal of or any premium or interest on the debt securities); or
- our compliance with certain restrictive provisions of the indenture.
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Under the indenture, we will be required to furnish the Trustee with an
annual statement about our performance of certain of our obligations under the
indenture and any default in such performance.
MERGER
The indenture provides that we may consolidate with, or sell, lease or
convey all or substantially all of our assets to, or merge into any other
corporation, without the consent of the holders of the debt securities, provided
that:
- the successor corporation is organized and existing under the laws of
the United States or a State and expressly assumes the due and punctual
payment of the principal of and any premium and interest on the
securities according to their terms and the due and punctual performance
and observance of the covenants and conditions of the indenture to be
performed by us; and
- after giving effect to the transaction, no event of default will have
occurred and be continuing.
Except as set forth in this prospectus or in any prospectus supplement, the
indenture will not contain any covenants or other provisions designed to afford
the holders of the debt securities protection in the event of a takeover,
recapitalization or highly leveraged transaction involving Dana.
MODIFICATION OF THE INDENTURE
We and the Trustee may amend or modify the indenture from time to time for
administrative convenience or necessity, provided that the changes do not
materially adversely affect the rights of the holders of the debt securities.
Moreover, with the consent of the holders of a majority in aggregate
principal amount of the outstanding debt securities, we and the Trustee may
amend or modify the indenture so as to affect the rights of such holders, except
that, without the consent of the holder of each security affected by such
amendment, no amendment or modification may:
- extend the time of maturity of the principal of or any installment of
interest on the securities;
- reduce the principal of or any premium or rate of interest on the
securities; or
- reduce the percentage in principal amount of outstanding debt securities
the consent of whose holders is required to waive compliance with
certain provisions of the indenture or to waive certain events of
default and their consequences.
DISCHARGE AND DEFEASANCE
We may satisfy and discharge our obligations under the indenture (other
than our obligation to pay the principal of and any premium and interest on the
debt securities and certain other specified obligations) if we:
- irrevocably deposit with the Trustee, as trust funds, the amount (in
money or U.S. government obligations maturing as to principal and
interest) sufficient to pay the principal of and any premium and
interest on the securities and any mandatory sinking fund obligations
with respect thereto on the stated maturity date of such payments or on
any redemption date; and
- comply with any additional conditions specified to be applicable with
respect to the defeasance of such securities.
The terms of any series of debt securities may also provide for legal
defeasance pursuant to the indenture. In such case, if we:
- irrevocably deposit money or U.S. government obligations as described
above,
- make a request to the Trustee to be discharged from our obligations on
such securities, and
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- comply with any additional conditions specified to be applicable with
respect to the legal defeasance of such securities,
then we will be deemed to have paid and discharged the entire indebtedness on
all such outstanding securities under the indenture and our obligation to pay
the principal of and any premium and interest on such securities will be
completely discharged and the holders of the securities will be entitled only to
payment out of the money or U.S. government obligations deposited with the
Trustee, unless our obligations are revived and reinstated because the Trustee
is unable to apply such trust fund due to any legal proceeding, order or
judgment.
PLAN OF DISTRIBUTION
We may offer the securities directly to purchasers, to or through
underwriters, through dealers or agents, or through a combination of such
methods.
If underwriters are used, we will execute an underwriting agreement with
them and will set out their names and the terms of the transaction (including
any underwriting discounts and other terms for compensation of the underwriters
and any dealers) in the prospectus supplement. If an underwriting syndicate is
used, the managing underwriter(s) will be set forth on the cover of the
supplement. In this event, the securities will be acquired by the underwriters
for their own accounts and may be resold from time to time in one or more
transactions, including negotiated transactions, at a fixed public offering
price or at varying prices determined at the time of sale. Any initial public
offering price and any discounts or concessions allowed or reallowed or paid to
dealers may be changed from time to time.
If dealers are used in an offering of the securities, we will sell the
securities to them as principals. The dealers then may resell the securities to
the public at varying prices which they determine at the time of resale. The
names of the dealers and the terms of the transaction will be set forth in the
prospectus supplement.
If agents are used in an offering of the securities, the names of the
agents and the terms of the agency will be set forth in the supplement. Unless
otherwise indicated in the supplement, the agents will act on a best-efforts
basis for the period of their appointment.
Dealers and agents named in a supplement may be deemed to be underwriters
(within the meaning of the Securities Act) of the securities described therein.
Underwriters, dealers and agents, may be entitled to indemnification by us
against certain liabilities (including liabilities under the Securities Act)
under the underwriting or other agreements with us.
We may solicit offers to purchase the securities from, and sell the
securities directly to, institutional investors or others who may be deemed to
be underwriters within the meaning of the Securities Act with respect to any
resales of the securities. The terms of any such offer will be set forth in the
prospectus supplement.
Certain underwriters, dealers or agents and their associates may engage in
transactions with, and perform services for, us in the ordinary course of
business, including refinancing of our indebtedness.
If so indicated in the supplement, we may authorize underwriters or other
persons acting as our agents to solicit offers by certain institutions to
purchase the securities from us pursuant to contracts providing for payment and
delivery on a future date. Institutions with which such contracts may be made
include commercial and savings banks, insurance companies, pension funds,
investment companies, educational and charitable institutions and others, but in
all cases we must approve such institutions. The obligations of any purchaser
under any such contract will be subject to the condition that the purchase of
the securities will not, at the time of delivery, be prohibited under the laws
of any jurisdiction to which such purchaser is subject. The underwriters and
such other agents will not have any responsibility for the validity or
performance of such contracts.
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To facilitate an offering of a series of the securities, some persons
participating in the offering may engage in transactions that stabilize,
maintain or otherwise affect the price of the securities. This may include
over-allotments or short sales of the securities, which involves the sale by
persons participating in the offering of more securities than we have sold to
them. In such circumstances, such persons would cover such over-allotments or
short positions by purchasing in the open market or by exercising their over-
allotment options. In addition, such persons may stabilize or maintain the price
of the securities by bidding for or purchasing them in the open market or by
imposing penalty bids, whereby selling concessions allowed to dealers
participating in any such offering may be reclaimed if securities they sell are
repurchased in connection with stabilization transactions. The effect of these
transactions may be to stabilize or maintain the market price of the securities
at a level above that which might otherwise prevail in the open market. Such
transactions, if commenced, may be discontinued at any time.
LEGAL MATTERS
Rosenman & Colin LLP of New York, New York and Hunton & Williams of
Richmond, Virginia may provide legal advice or opinions relating to the
securities. Robert L. Kohl, a member of Rosenman & Colin LLP, owns approximately
1,100 shares of our common stock.
Wachtell, Lipton, Rosen & Katz of New York, counsel for the underwriters,
and other counsel for the underwriters or agents who are identified in any
supplement may also provide legal advice or opinions relating to the securities.
Wachtell, Lipton, Rosen & Katz performs legal services for us from time to time.
EXPERTS
The financial statements for the three years ended December 31, 1997,
incorporated in this prospectus by reference to the Current Report on Form 8-K
filed on November 10, 1998, have been so incorporated in reliance upon the
report of PricewaterhouseCoopers LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.
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$1,000,000,000
[DANA CORPORATION LOGO]
DANA CORPORATION
$250,000,000 6 1/4% NOTES DUE 2004
$350,000,000 6 1/2% NOTES DUE 2009
$400,000,000 7% NOTES DUE 2029
-----------------------------------------
PROSPECTUS SUPPLEMENT
-----------------------------------------
MERRILL LYNCH & CO.
BT ALEX. BROWN
DEUTSCHE BANK SECURITIES
DONALDSON, LUFKIN & JENRETTE
FIRST CHICAGO CAPITAL MARKETS, INC.
A BANK ONE COMPANY
J.P. MORGAN & CO.
LEHMAN BROTHERS
MORGAN STANLEY DEAN WITTER
NATIONSBANC MONTGOMERY SECURITIES LLC
SALOMON SMITH BARNEY
FEBRUARY 26, 1999
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