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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(d)(4) OF THE
SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 13)
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DANA CORPORATION
(Name of Subject Company)
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DANA CORPORATION
(Name of Person(s) Filing Statement)
Common Stock, Par Value $1.00 Per Share
(including the Associated Series A Junior
Participating Preferred Stock Purchase Rights)
(Title of Class of Securities)
235811 10 6
(CUSIP Number of Class of Securities)
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Michael L. DeBacker, Esq.
Vice President, General Counsel and Secretary
Dana Corporation
4500 Dorr Street
Toledo, Ohio 43615
(419) 535-4500
(Name, Address and Telephone Number of Person Authorized to Receive Notice and
Communications on Behalf of the Person(s) Filing Statement)
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With copies to:
Adam O. Emmerich, Esq.
David C. Karp, Esq.
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
(212) 403-1000
[ ] Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.
The purpose of this amendment is to amend and supplement Items
8 and 9 in the Solicitation/Recommendation Statement on Schedule 14D-9
previously filed by Dana Corporation, a Virginia corporation, on July 22, 2003,
as thereafter amended, and to add an additional Exhibit and revise the Exhibit
Index accordingly.
Item 8. Additional Information to be Furnished.
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The "Litigation" section of Item 8 is hereby amended by adding the following
paragraphs to the end of such section:
On August 27, 2003, a consolidated and amended bill of
complaint was filed against the Company in the Circuit Court
for the City of Buena Vista, Virginia amending and
consolidating the purported shareholder derivative actions
originally filed by Adolph Feuerstein and Michael Martin
against the Company on July 10, 2003 and July 11, 2003,
respectively.
A copy of the consolidated and amended bill of complaint is
attached hereto as Exhibit (a)(23) and is incorporated herein
by reference. The foregoing description is qualified in its
entirety by reference to Exhibit (a)(23).
Item 9. Exhibits.
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Exhibit No. Description
(a) (23) Consolidated and amended bill of complaint filed in the
Circuit Court for the City of Buena Vista, Virginia.
(a) (24) Press release issued by Dana on September 8, 2003.
SIGNATURE
After due inquiry and to the best of my knowledge and belief,
I certify that the information set forth in this statement is true, complete and
correct.
DANA CORPORATION
By: /s/ Joseph M. Magliochetti
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Joseph M. Magliochetti
Chairman of the Board and
Chief Executive Officer
Dated: September 9, 2003
-2-
INDEX OF EXHIBITS
Exhibit No. Description
(a) (23) Consolidated and amended bill of complaint filed in the
Circuit Court for the City of Buena Vista, Virginia.
(a) (24) Press release issued by Dana on September 8, 2003.
-3-
Exhibit (a)(23)
IN THE CIRCUIT COURT FOR THE CITY OF BUENA VISTA
X
:
IN RE DANA CORPORATION :
SHAREHOLDER LITIGATION :
:
: CONSOLIDATED CIVIL ACTION
:
: Master File No. CH 03-000039-00
:
:
:
X
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CONSOLIDATED AND AMENDED BILL OF COMPLAINT FOR SHAREHOLDER
DERIVATIVE ACTION
Complainants Michael Martin and Adolph Feuerstein ("Complainants")
by their counsel, pursuant to the Stipulated Order of Consolidation, entered
August 27, 2003, upon knowledge with respect to themselves and their own acts,
and upon information and belief as to all other matters, hereby submit the
following as their Consolidated and Amended Bill of Complaint for Shareholder
Derivative Action:
SUMMARY OF THIS ACTION
1. On July 8, 2003, ArvinMeritor, Inc. ("ArvinMeritor"), a global supplier
of integrated systems, modules, components, and applications serving various
industries, announced a tender offer (the "Tender Offer") to acquire all of the
outstanding common stock of nominal defendant Dana Corporation ("Dana" or the
"Company") for $15 per share in cash, an aggregate price of approximately $2.5
billion for the common equity of the Company. ArvinMeritor intends to effectuate
the Tender Offer through its wholly-owned subsidiary, Delta Acquisition
Corporation ("Delta"), a Virginia corporation.
2. The Tender Offer represents a 55.7 percent premium over the closing
price of the Company's common stock on June 3, 2003, the last trading day before
ArvinMeritor first submitted a written proposal for a business combination to
Dana, and a 24.9 percent premium over the closing price of Dana's common stock
on July 7, 2003, the last trading day before ArvinMeritor and Delta commenced
their Tender Offer. ArvinMeritor seeks to acquire Dana through a transaction
that is non-coercive, non-discriminatory and entirely fair to Dana's
shareholders.
3. Since ArvinMeritor first contacted Dana, the Company has repeatedly
refused ArvinMeritor's proposals for a business combination and refused even to
negotiate with ArvinMeritor. Dana's Board of Directors (the "Individual
Defendants" identified in paragraphs 12 though 22) instead has embarked upon a
campaign to entrench itself and continues its control over Dana despite the
Individual Defendants' fiduciary duties to act in the best interests of the
Company and not their own.
4. Because ArvinMeritor's proposed acquisition of Dana (the "Proposed
Acquisition") offers substantial value to the Company's shareholders, the
Individual Defendants' continuous refusal to negotiate or even to discuss the
details of ArvinMeritor's proposal, their attempts to entrench themselves in
office, and their failure to disclose all material information concerning their
recommendation to shareholders to ignore the Tender Offer -- all at the expense
of Dana's shareholders -- constitute unreasonable responses to the Proposed
Acquisition, and violate the Individual Defendants' fiduciary duties to the
Company and its shareholders.
JURISDICTION AND VENUE
5. This Court has Jurisdiction over the Company because Dana is
incorporated under the laws of the Commonwealth of Virginia, and over the
Individual
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Defendants because, among other reasons, they are directors of a
Virginia corporation, and they are subject to jurisdiction under Virginia Code
ss. 8.01-328.1.
6. Venue is proper in this Court under Virginia Code ss. 8.01-262(3)
because Dana conducts business in Buena Vista, Virginia, at its office located
at 3200 Green Forest Avenue. This office, a division of Dana, manufactures
automotive and light truck axles. Upon information and belief, the office has
approximately 300 employees.
7. On or about July 8, 2003, ArvinMeritor and Delta filed against
defendants in this Court a Bill of Complaint for Injunctive and Declaratory
Relief (Buena Vista Cir. Ct. docket no. CH03-000037) alleging in four counts,
INTER ALIA, various breaches by defendants of their fiduciary duties. On or
about August 5, 2003, ArvinMeritor and Delta filed a First Amended and
Supplemental Bill of Complaint for Injunctive and Declaratory Relief The present
action is a related case.
THE PARTIES
8. Complainant Michael Martin, at all times relevant to this action, held
and still holds, shares of Dana. Complainant Martin will fairly and adequately
represent the interests of the Corporation in enforcing the rights of the
Corporation.
9. Complainant Adolph Feuerstein, at all times relevant to this action
held, and still holds, shares of Dana. Complainant Feuerstein will fairly and
adequately represent the interests of the Corporation in enforcing the rights of
the Corporation.
10. Nominal defendant Dana is a Virginia corporation with its principal
executive offices located at 4500 Dorr Street, Toledo, Ohio, 43615. Dana is a
global supplier of modules, systems, and components serving various industries.
As of April 25, 2003, Dana had approximately 148,620,000 shares of common stock
outstanding. Dana's shares trade on the New York Stock Exchange and the Pacific
Exchange. Upon information and belief, fewer than
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500 of Dana's employees are located in Virginia, with approximately 300 located
at the office in Buena Vista.
11. Upon information and belief, Dana does not own any real property in
Virginia.
12. Defendant Joseph M. Magliochetti ("Magliochetti") has been a director
of Dana since 1996, is Chairman of its Board of Directors, and is the Company's
Chief Executive Officer, President, and Chief Operating Officer.
13. Defendant Benjamin F. Bailar ("Bailar") has been a director of the
Company since 1980. In addition, defendant Bailar also has entanglements and
relationships with other board members which have prevented him, and are
preventing him from acting independently to fulfill his fiduciary duties owed to
Dana and its shareholders. For example, Bailar, along with Magliochetti,
Baillie, Carpenter, Clark, Hiner, Kelly, Priory and Senderos, Grise and Marks,
serves on the Board's finance committee, which is charged with overseeing Dana's
financial condition, liquidity and results of operations.
14. Defendant A. Charles Baillie ("Baillie") has been a director of the
Company since 1998. In addition, defendant Baillie has additional entanglements
and relationships with other board members which have prevented him, and are
preventing him from acting independently and fulfilling the fiduciary duties
owed to Dana and its shareholders, including:
a. Baillie, along with Priory (Chairman), Clark and Hiner, serves on
the Compensation Committee which establishes Magliochetti's
compensation and has overseen the granting of excessive stock
option compensation to the Company's Board and other executives.
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b. Baillie, along with Magliochetti, Bailar, Carpenter, Clark,
Hiner, Kelly, Priory and Senderos, Grise and Marks, serves on the
Board's Finance committee, which is charged with overseeing
Dana's financial condition, liquidity and results of operations.
c. Baillie, along with Magliochetti, Carpenter (Chairman), Senderos,
Grise and Marks, serves on the Board's Funds committee, which is
charged with overseeing Dana's pension funds and is responsible
for establishing the excessive pension benefits.
15. Defendant Edmund M. Carpenter ("Carpenter") has been a director of the
Company since 1991. In addition, defendant Carpenter also has long-standing
personal and professional entanglements and relationships with other board
members which have prevented him, and are preventing him from acting
independently and fulfilling the fiduciary duties owed to Dana and its
shareholders, including:
a. Carpenter, along with Magliochetti, Bailar, Baillie, Clark,
Hiner, Kelly, Priory and Senderos, Grise and Marks, serves on the
Board's Finance committee, which is charged with overseeing
Dana's financial condition, liquidity and results of operations.
b. Carpenter, along with Magilochetti, Baillie, Senderos, Grise and
Marks, serves on the Board's Funds committee (as its Chairman),
which is charged with overseeing Dana's pension funds and is
responsible for establishing the excessive pension benefits.
16. Defendant Eric Clark ("Clark") has been a director of the Company since
1994. In addition, defendant Clark also has long-standing personal and
professional
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entanglements and relationships with other board members which have prevented
him, and are preventing him from acting independently and fulfilling the
fiduciary duties owed to Dana and its shareholders, including:
a. Clark served as a member of the Dana Europe Advisory Board from
1991-1999. Clark, along with Priory (Chairman), Baillie and
Hiner, serves on the Compensation Committee which establishes
Magliochetti's compensation and has overseen the granting of
excessive stock option compensation to the Company's Board and
other executives.
b. Clark, along with Magliochetti, Bailar, Baillie, Carpenter,
Hiner, Kelly, Priory and Senderos, Grise and Marks, serves on the
Board's Finance committee, which is charged with overseeing
Dana's financial condition, liquidity and results of operations.
17. Defendant Glen H. Hiner ("Hiner") has been a director of the Company
since 1993. In addition, defendant Hiner also has long-standing personal and
professional entanglements and relationships with other board members which has
prevented him, and is preventing him from acting independently and fulfilling
the fiduciary duties owed to Dana and its shareholders, including:
a. Hiner, along with Priory (Chairman), Baillie and Clark, serves on
the Compensation Committee which establishes Magliochetti's
compensation and has overseen the granting of excessive stock
option compensation to the Company's Board and other executives.
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b. Hiner, along with Magliochetti, Bailar, Baillie, Carpenter,
Clark, Kelly, Priory and Senderos, Grise and Marks, serves on the
Board's Finance committee, which is charged with overseeing
Dana's financial condition, liquidity and results of operations.
18. Defendant James P. Kelly ("Kelley") has been a director of the Company
since 2002. In addition, defendant Kelley also has long-standing personal and
professional entanglements and relationships with other board members which have
prevented him, and are preventing him from acting independently and fulfilling
the fiduciary duties owed to Dana and its shareholders, including:
a. Kelley serves on the Bellsouth Corporation board of directors
along with Defendant Magliochetti.
b. Kelley, along with Magliochetti, Bailar, Baillie, Carpenter,
Clark, Hiner, Priory and Senderos, Grise and Marks, serves on the
Board's Finance committee, which is charged with overseeing
Dana's financial condition, liquidity and results of operations.
19. Defendant Marilyn R. Marks ("Marks") has been a director of the Company
since 1994. In addition, defendant Marks also has long-standing personal and
professional entanglements and relationships with other board members which have
prevented her, and are preventing her from acting independently and fulfilling
the fiduciary duties owed to Dana and its shareholders, including:
a. Marks served as Chairman of the Board of Dorsey Trailers, Inc.
("Dorsey") between 1987 and 2000 when Dorsey filed a voluntary
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petition for reorganization relief under Chapter 11 of the
Bankruptcy Code. Dana did substantial business with Dorsey.
n. Marks, along with Magliochetti, Bailar, Baillie, Carpenter,
Clark, Hiner, Kelly, Priory and Senderos, and Grise, serves on
the Board's Finance committee, which is charged with overseeing
Dana's financial condition, liquidity and results of operations.
c. Marks, along with Magliochetti, Carpenter (Chairman), Baillie,
Senderos, and Grise, serves on the Board's Funds committee, which
is charged with overseeing Dana's pension funds and is
responsible for establishing the excessive pension benefits.
20. Defendant Richard B. Priory ("Priory") has been a director of the
Company since 1996. In addition, defendant Priory also has long-standing
personal and professional entanglements and relationships with other board
members which have prevented him, and are preventing him from acting
independently and fulfilling the fiduciary duties owed to Dana and its
shareholders, including:
a. Priory, along with Magilochetti, is a member of the U.S. Business
Roundtable and its Policy Committee.
b. Priory, along with Baillie, Clark and Hiner, serves on the
Board's the Compensation Committee (as its Chairman) which
establishes Magliochetti's compensation and has overseen the
granting of excessive stock option compensation to the Company's
Board and other executives.
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c. Priory, along with Magliochetti, Bailar, Baillie, Carpenter,
Clark, Hiner, Kelly, Senderos, Grise and Marks, serves on the
Board's Finance committee, which is charged with overseeing
Dana's financial condition, liquidity and results of operations.
21. Defendant Fernando M. Senderos ("Senderos") has been a director of the
Company since 2000. In addition, defendant Senderos also has long-standing
personal and professional entanglements and relationships with other board
members which have prevented him, and are preventing him from acting
independently and fulfilling the fiduciary duties owed to Dana and its
shareholders, including:
a. Senderos, along with Magliochetti, Bailar, Baillie, Carpenter,
Clark, Hiner, Kelly, Priory, Grise and Marks, serves on the
Board's Finance committee, which is charged with overseeing
Dana's financial condition, liquidity and results of operations.
b. Senderos, along with Magliochetti, Carpenter (Chairman), Baillie,
Grise and Marks, serves on the Board's Funds committee, which is
charged with overseeing Dana's pension funds and is responsible
for establishing the excessive pension benefits.
22. Defendant Cheryl W. Grise ("Grise") has been a director of the Company
since 2002. In addition, defendant Grise also has long-standing personal and
professional entanglements and relationships with other board members which have
prevented her, and are preventing her from acting independently and fulfilling
the fiduciary duties owed to Dana and its shareholders, including:
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a. Grise has no equity interest in Dana and merely serves at the
favor of Magliochetti. Grise, along with Magilochetti, Bailar,
Baillie, Carpenter, Clark, Hiner, Kelly, Priory and Senderos, and
Marks, serves on the Board's Finance committee, which is charged
with overseeing Dana's financial condition, liquidity and results
of operations.
b. Grise, along with Magliochetti, Carpenter (Chairman), Baillie,
Senderos and Marks, serves on the Board's Funds committee, which
is charged with overseeing Dana's pension funds and is
responsible for establishing the excessive pension benefits.
23. By virtue of their positions as directors and/or officers of Dana and
their exercise of control over the business and corporate affairs of Dana, the
Individual Defendants have, and at all relevant times had, the power to control
and influence, and did control and influence and cause Dana to engage in the
practices complained of herein. Each Individual Defendant owed and owes Dana and
its common stockholders fiduciary duties and were and are required to:
a. Honestly communicate with Dana's shareholders in connection with
the ArvinMeritor tender offer;
b. Act in the best interests of Dana and prevent any abuse of
control by other top executives in the conduct of the business
and affairs of Dana;
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c. Govern Dana to utilize its resources in a manner to benefit the
Company and its public shareholders and not the personal
interests or preferences of defendants;
d. Refrain from entrenching themselves in power for their own
benefit and to the detriment of Dana's shareholders, adopting or
maintaining unreasonable defensive measures to entrench
themselves in their prestigious and lucrative positions with
Dana, or otherwise abusing their positions of control;
e. Not favor their own interests at the expense of Dana and/or its
public shareholders;
f. In good faith oversee, supervise and direct the business and
affairs of Dana and its executives in accordance with the
applicable laws;
g. Upon receiving notice of improper conduct to take steps to
correct or remedy that conduct; and
h. Exercise reasonable control and supervision over the officers and
employees of Dana.
24. By failing to act in good faith to consider the ArvinMeritor bid, the
Individual Defendants, as a matter of law, have breached their fiduciary duties
of good faith and fair dealing owed to Dana, Complainants and Dana's
shareholders.
FACTUAL BACKGROUND
DANA'S DETERIORATING FINANCIAL CONDITION
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25. Dana is a global supplier of modules, systems and components for light,
commercial and off-highway vehicle original equipment ("OE") manufacturers
globally and for related OE service and aftermarket customers.
26. Over the last several years, Dana has experienced substantial
mismanagement and its stock price has plummeted. In June 1999, Dana's stock was
trading at more than $54 per share. Over the next four years, Dana's stock lost
substantial value, closing at $9.63 on June 3, 2003, the last trading day before
ArvinMeritor first submitted its proposal to Dana.
27. Upon information and belief, due to its substantial financial
difficulties, Dana undertook a restructuring program nearly two years ago, in
September 2001. However, this restructuring plan has led only to plant closing
and to lost jobs for Dana employees, as Dana itself has acknowledged:
Among the elements of the restructuring are a workforce
reduction of more than 15 percent and the planned closure or
consolidation of more than 30 facilities. Through June 30,
[2002,] Dana had reduced its permanent workforce by
approximately 8 percent, closed 14 facilities, and announced
plans to close 14 others.
(Dana Corp., Press Release (July 17, 2002)).
Dana has reduced its permanent workforce by approximately 9
percent, closed 18 facilities, and announced plans to close
16 others from the inception of the restructuring plan
announced one year ago through Sept. 30, 2002.
(Dana Corp., Press Release (Oct. 25, 2002)).
28. Dana's dismal performance under the Individual Defendants' watch has
not improved. As of February 12, 2003, the Company closed 28 of its facilities
as part of its restructuring program. (Dana Corp., Press Release (Feb. 12,
2003)).
29. The ArvinMeritor Tender Offer would dramatically improve the situation
for Dana's shareholders. It represents a substantial improvement by offering a
55.7 percent
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premium over the closing price of the Company's common stock on June 2003, the
last trading day before ArvinMeritor first submitted its proposal to Dana.
THE INDIVIDUAL DEFENDANTS STONEWALL ARVINMERITOR
30. Despite the clear-cut, substantial economic benefits for Dana's
shareholders and Dana's significant financial struggles in the hands of its
current management, the Individual Defendants dismissed ArvinMeritor's proposal
without due and sufficient consideration. Such conduct violated the Individual
Defendants' fiduciary duties to act in the best interests of the Company and its
shareholders.
31. ArvinMeritor first conveyed its interest in acquiring Dana for $14 per
share in cash to Defendant Magliochetti, Dana's Chairman, Chief Executive
Officer, President, and Chief Operating Officer, during a telephone conversation
on June 4, 2003 (the "June 4, 2003 Conversation").
32. Defendant Magliochetti's reaction was immediate and adverse to Dana's
shareholders. f le refused to discuss ArvinMeritor's proposal. Instead, twice
during the June 4, 2003 Conversation, Defendant Magliochetti stated emphatically
that Dana was "not for sale."
33. This rejection of ArvinMeritor's proposal was not based on discussions
with the other Individual Defendants or any other employees or advisors of the
Company. As such, Defendant Magliochetti's rejection of ArvinMeritor's proposal
was uninformed and constituted a violation of his fiduciary duties to the
Company.
34. On June 4, 2003, Larry D. Yost, the Chairman and Chief Executive
Officer of ArvinMeritor, sent a letter to Defendant Magliochetti (the "June 4,
2003 Letter") memorializing ArvinMeritor's proposal of June 4, 2003. The letter
noted that the price offered by ArvinMeritor represented a premium of 45 percent
over the closing price of Dana's common stock on June 3, 2003.
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35. The June 4, 2003 Letter also noted that, as an alternative to the
proposal advanced earlier that day, ArvinMeritor was "prepared to consider a mix
of cash and stock consideration if it will facilitate a transaction." The June
4, 2003 Letter further stated that "[i]f you are willing to work with us to
consummate a transaction expeditiously, we may be prepared to analyze further
whether a higher value is warranted."
36. Mr. Yost also indicated in the June 4, 2003 Letter that "[i]f you or
any of your directors have any questions about our proposal, please feel free to
give me a call. I will make myself available at any time." In violation of their
fiduciary duties, however, none of the Individual Defendants have accepted Mr.
Yost's invitation to discuss the issues raised in his letter.
37. On June 12, 2003, Defendant Magliochetti telephoned Mr. Yost (the "June
12, 2003 Conversation") to express that Dana was not interested in a business
combination with ArvinMeritor. On June 12, 2003, Defendant Magliochetti also
sent a letter (the "June 12, 2003 Letter") to ArvinMeritor stating that Dana did
not have any interest in pursuing a sale transaction with ArvinMeritor. Upon
information and belief, the Individual Defendants failed to give ArvinMeritor's
offer due consideration, and in violation of their fiduciary duties, took action
to entrench themselves in office to retain substantial benefits and perquisites
such offices extended to them.
38. On June 16, 2003, Mr. Yost sent a letter to Defendant Magliochetti and
to Dana's Board (the "June 16, 2003 Letter") repeating ArvinMeritor's interest
in pursuing a transaction with Dana. In addition, Mr. Yost further explained the
significant benefits to both e companies shareholders of a merger between
ArvinMeritor and Dana. As the letter noted,
The combination of ArvinMeritor and Dana will create a
stronger Tier One supplier company providing numerous
technological and
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service benefits for our combined worldwide light vehicle,
commercial truck and aftermarket customers. This transaction will
bring together the right combination of innovation, capabilities
and resources to establish a more significant global enterprise.
Together, ArvinMeritor and Dana will become a true industry
leader with the strategic position that will allow us to better
serve our customers, employees and shareholders ....
In addition to the compelling strategic fit of our
respective product portfolios, a business combination of our
two companies will also create significant financial
benefits, including considerable sales, operating and cost
synergies beyond what either company could achieve on its
own. We believe these benefits will better position us to
compete and succeed in the increasingly competitive
automotive supply industry.
(June 16, 2003 Letter).
39. The June 16, 2003 Letter also stated that ArvinMeritor was "flexible in
considering a mix of cash and stock consideration if it will facilitate a
transaction," and again noted that ArvinMeritor "may be prepared to analyze
further whether a higher value is warranted." In further violation of their
fiduciary duties, the Individual Defendants refused to meet with ArvinMeritor or
even discuss ArvinMeritor's proposal.
40. The Individual Defendants' refusal to consider ArvinMeritor's proposal
or to attempt to negotiate the terms of the deal violates their fiduciary duties
to the Company. ArvinMeritor's proposal is available to all Dana shareholders,
for all outstanding shares. It is not "front-end loaded" or otherwise coercive
in nature, and ArvinMeritor has made clear that it intends to acquire any shares
not tendered in response to the Tender Offer for the same price of $15 per share
in cash in a second-step merger. The Tender Offer provides Dana shareholders
with the opportunity to realize a 55.7 percent premium over the closing price of
their shares on June 3, 2003, the last trading day before ArvinMeritor first
submitted its proposal in writing to Dana, and a 24.9 percent premium over the
closing price of their shares on July 7, 2003.
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41. Notwithstanding the fair and non-coercive nature of the Proposed
Acquisition, the substantial premium that ArvinMeritor is offering to Dana's
shareholders and Dana's impaired financial condition under its current
management, on June 19, 2003 -- only three days after ArvinMeritor sent its
second letter to Defendant Magliochetti -- ArvinMeritor received a letter from
Defendant Magliochetti (the "June 19, 2003 Letter") reiterating that Dana had no
interest in pursuing a sale transaction with ArvinMeritor.
42. In addition, despite ArvinMeritor's clear offer to negotiate the terms
of the proposed Acquisition, the June 19, 2003 Letter - like the June 12, 2003
Letter - conveyed an absolute refusal to meet with ArvinMeritor or even to
discuss ArvinMeritor's proposal with ArvinMeritor. Upon information and belief,
this knee-jerk reaction arises from the Individual Defendants' efforts to
entrench themselves at the expense and to the detriment of Dana's shareholders.
43. On or about July 8, 2003, frustrated by Dana's unwillingness to even
discuss a possible business combination at any price, Mr. Yost sent a letter to
defendant Magliochetti stating ArvinMeritor's willingness to increase its offer
to $15.00 per share in cash. Further, Yost stated that ArvinMeritor intended to
take its new $15.00 per share offer directly to Dana's public shareholders via a
tender offer, with the hope that Dana's shareholders would be permitted to
assess the desirability of ArvinMeritor's offer. Yost repeated that ArvinMeritor
would be willing to consider even greater consideration for Dana's shareholders
if Dana would merely enter into discussions with ArvinMeritor.
44. On or about July 9, 2003, ArvinMeritor issued a press release
publicly announcing its $15.00 per share offer for the first time. On July 10,
2003, ArvinMeritor commenced its offer.
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45. On July 18, 2003, eight days after the tender offer was commenced and
more than six weeks after ArvinMeritor first approached Dana, Dana's Board
formed a purported independent" committee for the purpose of reviewing and
discussing matters relevant to the Board's response to ArvinMeritor's offer (the
"Special Committee").
46. On July 22, 2003, Dana filed its Recommendation Statement on Schedule
14D-9 (the "Recommendation Statement") recommending that Dana shareholders
decline to tender their shares in response to the ArvinMeritor offer. In making
this recommendation, the Special Committee relied upon the opinion of Deutsche
Bank Securities Inc. ("Deutsche Bank"). Notably, Deutsche Bank presented its
analysis to ArvinMeritor earlier this year regarding a business combination with
Dana, supporting an offer price for Dana's shares of "less than or equal to the
[$15.00] offer price per share...."
47. In fact, Dana and the Individual Defendants have attempted to ensure
that Dana is not sold under any circumstances to ArvinMeritor. During a July 23,
2003 public earnings call, defendant Magliochetti announced that there was
effectively no price at which Dana would Consider a sale to ArvinMeritor. This
statement is also further evidence of the Individual Defendants' outright
refusal to even consider the proposal and/or tender offer.
48. On August 6, 2003, defendant Magliochetti announced that the Company,
definitively, had no intention of even investigating a possible transaction with
ArvinMeritor. During an automotive conference, Magliochetti told reporters that:
"We've responded to the offer that's been made, and from our vantage point, it's
concluded."
49. Despite the Individual Defendants' continuous rebuffs, ArvinMeritor, on
August 18, 2003, once again reiterated its willingness to discuss a negotiated
solution and once
17
again offered to discuss increasing the value to Dana's shareholders of the
Tender Offer, In a press release issued that day, ArvinMeritor stated that "if
Dana is willing to work with us to consummate a transaction, we will analyze
further whether a higher value is warranted. In addition, we are flexible in
considering a mix of cash and stock if it will facilitate a transaction."
(ArvinMeritor Press Release, dated August 18, 2003.)
THE INDIVIDUAL DEFENDANTS' CONFLICTS OF INTEREST
50. The Individual Defendants have a large financial stake in preventing
the Proposed Acquisition. Upon information and belief, Dana's directors awarded
themselves, as well as the Company's officers, significant numbers of stock
options in order to reap substantial personal gains at the expense of Dana's
shareholders. Due to the mismanagement of the Company by the Board and Dana's
officers, upon information and belief, the vast majority of those options are
currently "under water" - the price at which they may be exercised is higher
than Dana's stock price as of July 7, 2003 and the price per share of the Tender
Offer. The Individual Defendants, upon information and belief, are acting to
entrench themselves in an effort to hang on in the unfounded hope that, at some
point, their options will have value, or that they will have time to issue
themselves new options at a lower exercise price in order to enrich themselves.
The Individual Defendants and Dana's management, upon information and belief,
are not willing to relinquish control and the ability to issue themselves new
options, notwithstanding that relinquishing such control would be in the best
interests of those who own the Company - the shareholders.
51. ArvinMeritor cannot complete its acquisition of Dana unless the
Individual Defendants - voluntarily or by direction of the Court - remove or
render inapplicable antitakeover devices, including Dana's shareholder rights
plan (the "Poison Pill").
DANA'S POISON PILL
18
52. On April 25, 1996, the Company adopted its Poison Pill pursuant to a
Rights Agreement (the "Rights Agreement") with Chemical Mellon Shareholder
Services, L.L.C. (the predecessor in interest to Bank of New York). The term of
the Poison Pill extends until July 25, 2006,
53. On April 15, 1996, the Company's Board declared a dividend of one
preferred share purchase right (the "Right") for each outstanding share of
common stock, par value $1 per share, of the Company, The dividend became
payable on July 25, 1996 to the shareholders of record on that date.
54. The primary purpose of the Poison Pill is to allow the holders of the
Rights, under certain circumstances, to purchase shares of Dana's common stock
at a deep discount. In this way, the Poison Pill enables the holders of the
Rights to dilute the interests in Dana of a person or group of affiliated or
associated persons (an "Acquiring Person") who has acquired, obtained the right
to acquire, or commenced or announced an intention to commence a tender offer or
exchange offer for, 15 percent or more of the outstanding shares of Dana's
common stock.
55. Each Right entitles the holder, except for the Acquiring Person, to
purchase from the Company one one-thousandth of a share of the Company's Series
A Junior Participating Preferred Stock, no par value (the "Preferred Shares"),
at a price of $110 per one one-thousandth of a Preferred Share, subject to
adjustment (the "Purchase Price"). The Rights do not become exercisable, and
separate certificates representing the rights (the "Rights Certificates") are
not distributed, unless and until the earlier to occur of:
a. ten days after a public announcement or notice to the Company
that an Acquiring Person has acquired, or obtained the right to
19
acquire, beneficial ownership of 15 percent or more of the
outstanding shares of common stock of the Company; or
b. ten business days (or such later date as may be determined by
action of the Board prior to such time a person becomes an
Acquiring Person) after the commencement of, or the announcement
of an intention to make a tender offer or exchange offer for 15
percent or more of the outstanding shares of the Company's common
stock.
56. The Rights do not have any economic value until the occurrence of a
"Flip-In Event" or a "Flip-Over Event." A Flip-In Event occurs if and when a
holder of Dana stock becomes an Acquiring Person. At that point, all Rights
other than those held by the Acquiring Person "flip-in" and become discount
fights which entitle the holders to purchase Dana common stock at a steep
discount, thereby diluting the interests of the Acquiring Person. Specifically,
each right that "flips-in" becomes exercisable for shares of the Company's
common stock with a value equal to twice the Right's exercise price. Thus, for
the exercise price of $110, the holder of a Right other than an Acquiring Person
may purchase Dana common stock having a market value of $220 - a 50 percent
discount to market price.
57. If and when Dana engages in a merger or a sale of 50 percent or more of
its assets (a "Flip-Over Event"), the Rights then "flip-over." Following a
Flip-Over Event, each holder of the Rights - other than the Acquiring Person -
will be entitled to receive shares of the acquiring company. In particular, upon
exercising the Rights at their then-current exercise price, the holders will be
entitled to receive that number of shares of common stock of the acquiring
company with a market value, at the time of such event, of twice the exercise
price of the Right.
20
In this way, the Company's shareholders come to significantly dilute the
percentage of the acquiror's stock that the acquiror's original stockholders
held.
58. The Individual Defendants have the authority to redeem the Rights, at a
redemption price of $0.01 per Right, at any time before an Acquiring Person
acquires beneficial ownership of 15 percent or more of the Company's outstanding
common stock.
59. The existence of the Rights effectively preclude ArvinMeritor from
consummating the Tender Offer, regardless of the extent to which Dana's
shareholders wish to sell their shares pursuant to the Tender Offer. Unless the
Individual Defendants redeem the Rights, ArvinMeritor's acceptance of shares
tendered pursuant to its Tender Offer (i) will result in it becoming an
Acquiring Person, (ii) will make the Rights exercisable for shares of Dana's
common stock at a discount of 50 percent of their market value, (iii) will make
the Tender Offer economically infeasible for ArvinMeritor to accomplish, and
(iv) will deprive Dana's shareholders of the ability to benefit from the
Proposed Acquisition.
60. The Individual Defendants' failure to redeem the Rights and thus
maintain themselves in office constitute violations of their fiduciary duties.
THE INDIVIDUAL DEFENDANTS' INADEQUATE DISCLOSURES CONCERNING THE TENDER OFFER
61. In addition to denying Dana's public shareholders the right to even
consider ArvinMeritor's lucrative offer, the Individual Defendants have failed
to provide the Company's public shareholders with full and fair information
concerning the ArvinMeritor offer, In a Schedule 14D9 filed on or about July 22,
2003, and subsequent amendments thereto, in connection with the Tender Offer the
Individual Defendants have failed to provide the following material information:
a. any description of the financial analyses, presentations, and/or
opinions of Deutsche Bank, Credit Suisse First Boston and
21
Goldman Sachs, the three investment banks/financial advisors that
Dana retained to assess the adequacy of ArvinMeritor's offer;
b. the ranges of fair value for the Company calculated by the three
investment banks/financial advisors;
c. the amount and nature of the compensation that is being paid to
each of Dana's investment banks/financial advisors; and
d. any description of the "strategic alternatives" Dana is
purportedly considering to ArvinMeritor's offer.
DERIVATIVE CLAIM FOR BREACH OF FIDUCIARY DUTY
62. Complainants repeat and reallege each and every paragraph set forth
above as if set forth fully herein.
63. Complainants bring this claim derivatively in the right and for the
benefit of Dana to redress injuries suffered and to be suffered by the Company
as a direct result of the violations of fiduciary duties by the Individual
Defendants. In particular, Complainants seek redress for the injuries suffered
and to be suffered by the Company by virtue of, inter alia, the actions
undertaken and measures approved and or endorsed by the Individual Defendants
which were and are motivated solely or primarily for purposes of entrenchment.
64. Complainants have not made any demand on the present Board of'
Directors of the Company to institute this action because such demand would be
futile and is thereby excused for the following reasons:
a. The Individual Defendants are not disinterested with respect to
their refusal to disable the Poison Pill, and their summary,
uninformed rejections of the ArvinMeritor offers were undertaken
unlawfully, in bad faith and with the primary purpose and effect
of
22
entrenchment. The design and effect of the Individual Defendants'
conduct and its timing, demonstrate that a basic motive of taking
these actions and implementing these measures was to secure the
Individual Defendants in their positions and emoluments within
the Company. The Individual Defendants' summary, uninformed
rejections of the recent premium offer have clear anti-takeover
purposes and consequences. Under the circumstances, the
Individual Defendants - in approving and implementing these steps
- have acted with a sole or primary motive to perpetuate
themselves in their positions of control within the corporate
structure and to benefit themselves and other members of Dana's
executive management with whom they are closely allied.
b. The Individual Defendants are further interested in these
transactions because each receives substantial salaries, bonuses,
payments, benefits, and/or other emoluments by virtue of service
on the Board. The Individual Defendants have thus benefitted and
will continue to benefit from the wrongs herein alleged and have
acted to preserve their positions of dominance and control and
the perquisites thereof, and are incapable of exercising
independent business judgment in deciding whether to bring this
action.
c. In addition to being self-interested, the Individual Defendants -
in taking the actions and approving the measures described above
- fundamentally failed to exercise sound and proper business
23
judgment. The Individual Defendants, inter alia, have failed to
exercise due care in formulating and approving their conduct in a
manner not in the best interests of the Company and its public
shareholders.
d. The Individual Defendants are not acting in the best interests of
the Company but, in entrenching management, are acting, and
continue to act out of personal friendship for each other without
regard for the consequences of their conduct on the Company.
e. As a result of the acts and conduct described above, the
Individual Defendants are not fully informing themselves, are not
acting in good faith and have deliberately and/or recklessly
breached their fiduciary and other common law duties which they
owe to the Company. Among other things, the unlawful failure to
consider ArvinMeritor's offer with due care and simultaneous
decision to maintain the Poison Pill, have the effect of
entrenching the Individual Defendants in their corporate offices
against any real or perceived threat to their control and
represents an ill-considered, hasty reaction which did not
satisfy the directors' duty to obtain adequate information before
rejecting a BONA FIDE acquisition proposal. Defendants are
manipulating Dana's corporate machinery and abusing their
positions of control for purposes of securing their positions and
control.
24
65. By virtue of the acts and conduct alleged herein, the Individual
Defendants are carrying out a preconceived plan and scheme to entrench
themselves in office, and to protect and advance their own personal financial
interests at the expense of Dana and its shareholders. Their actions are grossly
disproportionate to any real or apparent threat.
66. By reason of the foregoing, Dana has sustained and will continue to
sustain irreparable harm and has no adequate remedy at law.
DECLARATORY JUDGMENT PURSUANT TO VA. CODE ANN. ss. 8.01-184
67. Complainants repeat and reallege each and every paragraph set forth
above as if set forth fully herein.
68. The Individual Defendants' persistent effort to entrench themselves in
office for their own interests and their disregard of Dana's shareholders'
preference for the Tender Offer and Proposed Merger gives rise to an actual
controversy between the parties.
69. Dana's Board of Directors owe fiduciary duties to Dana's shareholders,
including Complainants, and to no other constituencies.
70. ArvinMeritor's Tender Offer does not pose any threat to Dana or Dana's
shareholders.
71. Dana's directors have engaged in persistent efforts to entrench
themselves, including:
a. their refusal to negotiate with ArvinMeritor to obtain a higher
offering price for their shareholders;
b. their refusal to redeem the Poison Pill;
c. their disregard for shareholder-proposed corporate governance
measures;
25
d. their misuse of Dana's funds to ensure that they remain
directors; and
e. their efforts are not proportionate to any possible threat the
offer may pose, nor within the range of reasonable responses to
the Tender Offer, foreclose effective shareholder action and are
in breach of defendants' fiduciary duties.
72. Complainants seek a declaration that the directors of Dana have
breached their fiduciary duties owed to the Complainants and Dana.
INJUNCTIVE RELIEF PURSUANT TO VA. CODE ANN. ss. 8.01-620
73. Complainants repeat and reallege each and every paragraph set forth
above as if set forth fully herein.
74. Complainants will suffer irreparable harm if the Court does not enjoin
the defendants from their persistent pattern of complicity of interest and
entrenchment in office by disenfranchising their shareholders. Dana's directors
have already engaged in wasteful activities for which neither Complainants nor
any other Dana shareholder will have an adequate remedy at law, including but
not limited to:
a. refusing to negotiate with ArvinMeritor to obtain a higher
offering price for their shareholders;
b. refusing to redeem the Poison Pill; and
c. misusing Dana's funds to ensure that they remain directors.
75. Complainants seek an order enjoining Dana's board of directors from
taking any actions to thwart or interfere with the Tender Offer or Proposed
Merger, so that the shareholders of Dana can decide for themselves whether to
accept ArvinMeritor's offer to purchase their shares of Dana stock.
26
DERIVATIVE CLAIM FOR BREACH OF FIDUCIARY DUTY - UNLAWFUL ENTRENCHMENT
76. Complainants repeat and reallege each and every paragraph set forth
above as if set forth fully herein.
77. Complainants bring this Claim derivatively in the right and for the
benefit of Dana to redress injuries suffered and to be suffered by the Company
as a direct result of the violations of fiduciary duties by the Individual
Defendants. In particular, Complainants seek redress in this Claim for the
injuries suffered and to be suffered by the Company by virtue of, INTER ALIA,
the actions undertaken and measures approved by defendants which were and are
motivated solely or primarily for purposes of entrenchment.
78. In addition to being self-interested, the Individual Defendants - in
taking the actions and approving the measures described above - fundamentally
failed to exercise sound and proper business judgment. Defendants, INTER ALIA,
failed to exercise due care and to act in the best interests of the Company in
formulating and approving their conduct in a manner not in the best interests of
the Company and its public shareholders.
79. As a result of the acts and conduct described above, the Individual
Defendants are not fully informing themselves, are not acting in good faith and
have deliberately and/or recklessly breached their fiduciary and other common
law duties which they owe to the Company. Among other things, the defendants'
unlawful failure to consider ArvinMeritor's offer with due care and simultaneous
decision to maintain the Poison Pill, have the effect of entrenching the
Individual Defendants in their corporate offices against any real or perceived
threat to their control and represents an ill-considered, hasty reaction which
did not satisfy the directors' duty to obtain adequate information before
rejecting a bona fide acquisition proposal.
27
Defendants are manipulating Dana's corporate machinery as set forth herein and
abusing their positions of control for purposes of securing their positions of
control.
80. To the extent that the conduct of the Individual Defendants is based
upon what they perceive to be a threat by a third-party to take over Dana, the
Individual Defendants have a heightened fiduciary duty to act in the best
interest of the Company's public stockholders and to act reasonably with regard
to any such perceived threat. They have recklessly and in bad faith violated
such duties.
81. By virtue of the acts and conduct alleged herein, the Individual
Defendants are carrying out a preconceived plan and scheme to entrench
themselves in office, to thwart a fair and open auction of the Company that
would maximize shareholder value, and to protect and advance their own personal
financial interests at the expense of Dana and its shareholders, acting grossly
disproportionately to any real or apparent threat.
82. By reason of the foregoing, Dana has sustained and will continue to
sustain irreparable harm and has no adequate remedy at law.
DERIVATIVE CLAIM FOR BREACH OF FIDUCIARY DUTY OF CANDOR
83. Complainants repeat and reallege each and every paragraph set forth
above as if set forth fully herein.
84. The fiduciary duty of candor requires disclosure of all information in
defendants' possession germane to the transaction at issue. Directors are
under a fiduciary duty to disclose fully and fairly all material information
within the Board's control when it seeks or recommends shareholder action.
85. As set forth above, the Schedule 14D-9 and the amendments thereto fail
to disclose material information concerning the financial analyses and opinions
of any of the three investment banks retained by Dana to assess the adequacy of
ArvinMeritor's offer. Moreover,
28
the Schedule 14D-9 touts the fact that Dana's Board has considered, and is
considering "strategic alternatives," but does not include any description of
any of these so-called alternatives to a merger with ArvinMeritor.
86. Defendants, in breach of their fiduciary duty of candor, have stranded
Dana's shareholders without information necessary to make an informed decision
concerning the fairness and adequacy of the Tender Offer.
87. As a result of the Individual Defendants' unlawful conduct,
Complainants and the other Dana shareholders have been injured and have no
adequate remedy at law.
DERIVATIVE CLAIM FOR ABUSE OF CONTROL
88. Complainants repeat and reallege each and every paragraph set forth
above as if set forth fully herein.
89. Defendant Magliochetti, as Chairman of the Dana Board and the Company's
Chief Executive Officer, President, and Chief Operating Officer, abused his
control of Dana. The other Dana directors deliberately refused to exercise
independent or effective oversight of Dana or its executives, and therefore
deliberately pursued the improper course of (i) refusing to respond in good
faith to ArvinMeritor regarding its BONA FIDE offers for the Company, (ii)
entrenching themselves as managers and/or directors of the Company, and (iii)
attempting to protect their own personal interests at the expense of Dana and
its public shareholders.
90. This conduct by defendants amounted to an abuse of their abilities to
control Dana, in violation of their obligations to Dana and Dana's public
shareholders.
91. By reason of the foregoing, Complainants, as shareholders and
representatives of Dana seek relief for Dana which has sustained, and will
continue to sustain irreparable harm and has no adequate remedy at law.
DERIVATIVE CLAIM FOR WASTE OF CORPORATE ASSETS
29
92. Complainants repeat and reallege each and every paragraph set forth
above as if set forth fully herein.
93. As a result of allowing consideration of the foregoing compensation
arrangements and related-party transactions to guide their judgments, and by
failing to property to consider the interests of the Company and its public
shareholders, defendants have caused Dana to waste valuable corporate assets.
94. By reason of the foregoing, Complainants, as shareholders and
representatives of Dana, seek relief for Dana which has sustained, and will
continue to sustain irreparable harm and has no adequate remedy at law.
DERIVATIVE CLAIM FOR UNJUST ENRICHMENT
95. Complainants repeat and reallege each and every paragraph set forth
above as if set forth fully herein.
96. As a result of the tortious conduct described above, certain of
defendants will be and have been unjustly enriched at the expense of Dana. In
particular, Defendant Magliochetti (and other executives of Dana) has been
unjustly enriched by receipt of excessive salaries, bonuses, termination
benefits and/or related-party payments by Dana.
97. Defendants should be required to disgorge any and all gain which they
will unjustly obtain at the expense of Dana and a constructive trust for the
benefit of Dana should be imposed thereon.
98. By reason of the foregoing, Complainants, as shareholders and
representatives of Dana, seek relief for Dana which has sustained, and will
continue to sustain irreparable harm and has no adequate remedy at law.
WHEREFORE, Complainants respectfully demand judgment as follows:
30
A. Declaring that the Individual Defendants have violated their
fiduciary duties to the Company;
B. Enjoining the Individual Defendants from abusing the corporate
machinery of the Company for the purpose of entrenching
themselves in office;
C. Ordering the Individual Defendants, jointly and severally, to
account to the Company for all damages suffered and to be
suffered by them as a result of the acts and transactions alleged
herein;
D. Ordering that the Individual Defendants disgorge any and all gain
which they have unjustly obtained, or will unjustly obtain, at
the expense of Dana and that a constructive trust for the benefit
of Dana be imposed thereon;
E. Enjoining the Individual Defendants from adopting any further
measure that has the effect of improperly impeding, thwarting,
frustrating or interfering with the Proposed Acquisition or
Tender Offer in a manner inconsistent with their fiduciary
duties;
F. Enjoining the Individual Defendants from taking any action to
delay, impede, postpone or thwart the voting or other rights of
Dana's shareholders;
G. Awarding Complainants their costs and disbursements in this
action, including reasonable attorneys' and experts' fees; and
H. Granting Complainants such other and further relief as this Court
may deem just and proper.
31
Respectfully Submitted,
MICHAEL MARTIN
ADOLPH FEUERSTEIN
By Counsel
/s/ Garret M. Smith
------------------------------------------
Garrett M. Smith (Virginia Bar # 34162)
MICHIE, HAMLETT, LOWRY, RASMUSSEN
& TWEEL, P.C.
500 Court Square, Suite 300
P.O. Box 298
Charlottesville, VA 22902
Telephone: (434) 951-7222
Facsimile: (434) 951-7242
CAULEY GELLER BOWMAN
& RUDMAN LLP
Samuel H. Rudman
200 Broadhollow Road, Suite 406
Melville, NY 11747
Telephone: (631) 367-7100
Facsimile: (631) 367-1173
MILBERG WEISS BERSHAD HYNES
& LERACH, LLP
Steven G. Schulman
Seth D. Rigrodsky
One Pennsylvania Plaza
New York, NY 10119-0165
Telephone: (212) 594-5300
SCHIFFRIN & BARROWAY LLP
Patricia C. Weiser
Three Bala Plaza East
Suite 400
Bala Cynwyd, PA 19004
Telephone: (610) 667-7706
Dated: Charlottesville, Virginia
August 27, 2003
137674
32
Exhibit (a) (24)
CONTACT: Michelle Hards
(419) 535-4636
michelle.hards@dana.com
DANA CORPORATION COMMENTS ON FEDERAL TRADE COMMISSION DECISION
TO EXTEND PROBE INTO ANTITRUST CONCERNS OVER ARVINMERITOR OFFER
TOLEDO, Ohio, September 8, 2003 - Dana Corporation (NYSE: DCN) issued the
following statement today in connection with a Federal Trade Commission (FTC)
request for additional information from ArvinMeritor, Inc. (NYSE: ARM) and Dana
relating to ArvinMeritor's unsolicited tender offer for all outstanding Dana
shares.
The "second request" seeks information regarding a dozen product areas where
there is material competitive overlap between ArvinMeritor and Dana, including
medium- and heavy-duty axles; axle components and systems; foundation, S-cam,
and disc brakes; driveshafts; and air and oil filters.
"From the outset, we said that ArvinMeritor's tender offer raises serious
antitrust issues and was likely to attract intensive scrutiny from government
regulatory authorities," said Dana Chairman and CEO Joe Magliochetti. "Dana and
ArvinMeritor are currently the only substantial North American producers of
axles, driveshafts, and foundation brakes for medium- and heavy-duty trucks,
with combined market shares ranging from 80 percent to 100 percent.
"Despite ArvinMeritor's attempt to downplay the antitrust concerns, the serious
nature of the antitrust obstacles is underscored by the FTC's action today,
which implicates fundamental elements of the tender offer," he added.
"ArvinMeritor has recently spoken of the potential for significant divestitures
of the combined company's commercial vehicle axle assets and other businesses in
response to regulatory concerns. Even if deemed acceptable by the FTC, these
actions would appear to limit opportunities for synergies and would result in a
very different company from the one proposed in ArvinMeritor's offer," Mr.
Magliochetti said. "Based on this and many other factors, our shareholders are
understandably questioning the strategic logic, as well as the financial logic,
of the offer. We expect that ArvinMeritor's shareholders would share those
concerns."
Dana's shareholders, and its customers, suppliers, and employees, are strongly
advised to read carefully Dana's solicitation/recommendation statement regarding
ArvinMeritor's tender offer, because it contains important information. Copies
of the solicitation/recommendation statement and the related amendments, which
have been filed by Dana with the Securities and Exchange Commission, are
available at no charge at the SEC's web site at www.sec.gov, or at the Dana web
-----------
site at www.dana.com, and also by directing requests to Dana's Investor
------------
Relations Department.
Dana is a global leader in the design, engineering, and manufacture of
value-added products and systems for automotive, commercial, and off-highway
vehicle manufacturers and their related aftermarkets. The company employs
approximately 60,000 people worldwide. Founded in 1904 and based in Toledo,
Ohio, Dana operates hundreds of technology, manufacturing, and customer service
facilities in 30 countries. The company reported 2002 sales of $9.5 billion.
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