UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

SCHEDULE 14A

(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

 

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No.  )

 

Filed by the Registrant þ

 

Filed by a Party other than the Registrant o

 

Check the appropriate box:

 

o  Preliminary Proxy Statement

o  Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

þ  Definitive Proxy Statement

o  Definitive Additional Materials

o  Soliciting Material Pursuant to Section 240.14a-11c or Section 240.14a-12

 

DANA HOLDING CORPORATION

(Name of Registrant as Specified In Its Charter)

 

(Name of Person(s) Filing Proxy Statement)

 

Payment of Filing Fee (Check the appropriate box):

 

 

 

 

 

 

 

 

 

 

 

 

Dana Holding Corporation

 

Important Notice Regarding the Availability of Proxy

Materials for the Annual Meeting of

Shareholders to be Held on April 28, 2010

 

Proxy Statement and Notice of

2010 Annual Meeting of Shareholders

 

Our Proxy Statement and Annual Report

are Available at www.dana.com/2010proxy

 

Dana Holding Corporation

3939 Technology Drive

Maumee, Ohio 43537

 

March 26, 2010

 

Dear Fellow Shareholder:

 

It is our pleasure to invite you to attend the 2010 Annual Meeting of Shareholders of Dana Holding Corporation at 8:30 a.m., Eastern Time, on Wednesday, April 28, 2010 at The Westin Detroit Metropolitan Airport, 2501 Worldgateway Place, Romulus, Michigan 48242. Registration will begin at 7:30 a.m., Eastern Time. A map showing the location of the Annual Meeting is on the back cover of the accompanying proxy statement.

 

The annual report, which is included, summarizes Dana’s major developments and includes our consolidated financial statements.

 

Whether or not you plan to attend the 2010 Annual Meeting of Shareholders, please either sign and return the accompanying proxy card in the postage-paid envelope or instruct us by telephone or via the Internet indicating how you would like your shares voted. Instructions on how to vote your shares by telephone or via the Internet are on the proxy card enclosed with this proxy statement.

 

Sincerely,

 

 

John M. Devine

Executive Chairman

 

PROXY STATEMENT

 

Table of Contents

 

 

Dana Holding Corporation

Notice of Annual Meeting of Shareholders

April 28, 2010

 

 

 

 

We invite you to attend the Dana Holding Corporation 2010 Annual Meeting of Shareholders to:

 

1. Elect four Directors for a one-year term expiring in 2011 or upon the election and qualification of their successors;

 

2. Ratify the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2010; and

 

3. Transact any other business that is properly submitted before the Annual Meeting or any adjournments or postponements of the Annual Meeting.

 

In addition to the items above, the 4.0% Series A Preferred Convertible Holders (Series A Preferred Holders) will vote separately as a class to elect three Directors for a one-year term expiring in 2011 or upon the election and qualification of their successors.

 

The record date for the Annual Meeting is March 1, 2010 (the Record Date). Only shareholders of record at the close of business on the Record Date can vote at the Annual Meeting. Dana mailed this Notice of Annual Meeting to those shareholders. Action may be taken at the Annual Meeting on any of the foregoing proposals on the date specified above or any date or dates to which the Annual Meeting may be adjourned or postponed.

 

Dana will have a list of shareholders who can vote at the Annual Meeting available for inspection by shareholders at the Annual Meeting and, for 10 days prior to the Annual Meeting, during regular business hours at Dana’s Law Department, 3939 Technology Drive, Maumee, Ohio 43537.

 

If you plan to attend the Annual Meeting, but are not a shareholder of record because you hold your shares in street name, please bring evidence of your beneficial ownership of your shares (e.g., a copy of a recent brokerage statement showing the shares) with you to the Annual Meeting. You also must bring the proxy card your broker provided to you if you intend to vote at the meeting. See the “Questions and Answers” section of the proxy statement for a discussion of the difference between a shareholder of record and a street name holder.

Whether or not you plan to attend the Annual Meeting and whether you own a few or many shares of stock, the Board of Directors urges you to vote promptly. Registered holders may vote by signing, dating and returning the enclosed proxy card, by using the automated telephone voting system, or by using the Internet voting system. You will find instructions for voting by telephone and by the Internet on the proxy card and in the “Questions and Answers” section of the proxy statement.

 

By Order of the Board of Directors,

 

 

Marc S. Levin

Senior Vice President, General Counsel,

and Corporate Secretary

 

March 26, 2010

 

Dana Holding Corporation

 

3939 Technology Drive

Maumee, Ohio 43537

 

2010 PROXY STATEMENT

 

QUESTIONS AND ANSWERS

 

The Board of Directors is soliciting proxies to be used at the Annual Meeting of Shareholders to be held on Wednesday, April 28, 2010, beginning at 8:30 a.m., Eastern Time, at The Westin Detroit Metropolitan Airport, 2501 Worldgateway Place, Romulus, Michigan 48242. This proxy statement and the enclosed form of proxy are being made available to shareholders beginning March 26, 2010.

 

 

What is a proxy?

 

A proxy is your authorization for someone else to vote for you in the way that you want to vote. When you complete and submit a proxy card or use the automated telephone voting system or the Internet voting system, you are submitting a proxy. Dana’s Board of Directors is soliciting this proxy. All references in this proxy statement to “you” will mean you, the shareholder, and to “yours” will mean the shareholder’s or shareholders’, as appropriate.

 

 

What is a proxy statement?

 

A proxy statement is a document the United States Securities and Exchange Commission (the SEC) requires to explain the matters on which you are asked to vote on by proxy and to disclose certain related information. This proxy statement and the accompanying proxy card were first mailed to the shareholders on or about March 26, 2010.

 

 

What is the purpose of the Annual Meeting?

 

At our Annual Meeting, shareholders will act upon the matters outlined in the notice of meeting, including i) the election of directors; and ii) ratification of the selection of Dana’s independent registered public accounting firm. Also, management will report on the state of Dana and respond to questions from shareholders.

 

 

What is the record date and what does it mean?

 

The record date for the Annual Meeting is March 1, 2010. The record date was established by the Board of Directors as required by Delaware law. Holders of common stock and holders of 4.0% Series A Preferred Convertible Stock (Series A Preferred) and 4.0% Series B Preferred Convertible Stock (Series B Preferred, and together with Series A Preferred, Preferred Stock) at the close of business on the record date are entitled to receive notice of the meeting and to vote at the meeting and any adjournments or postponements of the meeting.

 

Who is entitled to vote at the Annual Meeting?

 

Holders of our common stock and holders of our Preferred Stock at the close of business on the record date may vote at the meeting.

 

On March 1, 2010, 139,563,578 shares of our common stock, 2,500,000 shares of Series A Preferred and 5,400,000 shares of Series B Preferred were outstanding, and accordingly, are eligible to be voted. Pursuant to our Restated Certificate of Incorporation, the holders of our Preferred Stock vote their Preferred Stock on an as-if-converted basis based on a conversion price of $11.93. As of March 1, 2010, the outstanding Series A Preferred was convertible into approximately 20,955,574 shares of common stock, and the outstanding Series B Preferred was convertible into approximately 45,264,040 shares of common stock.

 

 

What are the voting rights of the holders of common stock and Preferred Stock?

 

Each outstanding share of common stock will be entitled to one vote on each matter to be voted upon.

 

The number of votes for each share of Preferred Stock is calculated in accordance with Dana’s Restated Certificate of Incorporation. At this year’s meeting, each outstanding share of Preferred Stock will be entitled to approximately 8.382 votes on each matter to be voted upon. As a result, the holders of our Series A Preferred will have approximately 20,955,574 shares of common stock on an as-if-converted basis to vote and the holders of our Series B Preferred will have approximately 45,264,040 shares of common stock on an as-if-converted basis to vote. The holders of Preferred Stock are permitted to vote on this as-if-converted basis along with the holders of common stock for the election of directors, the ratification of the appointment of PricewaterhouseCoopers LLP as the independent registered accounting firm and for all other matters that properly come before the meeting.

 

 

Who elects the Series A Preferred Directors?

 

Our Restated Certificate of Incorporation and the Shareholders Agreement dated January 31, 2008 give the holders of our Series A Preferred the right to elect three directors at our Annual Meeting. Only the holders of our Series A Preferred will be entitled to vote to elect these three directors to our Board. Currently, Centerbridge Capital Partners, L.P. and certain of its affiliates (collectively, Centerbridge) are the only holders of our Series A Preferred.

 

 

What is the difference between a shareholder of record and a “street name” holder?

 

If your shares are registered directly in your name, you are considered the shareholder of record with respect to those shares.

 

If your shares are held in a stock brokerage account or by a bank or other nominee, then the brokerage firm, bank or other nominee is considered to be the shareholder of record with respect to those shares. However, you still are considered the beneficial owner of those shares, and your shares are said to be held in “street name.” Street name holders generally cannot vote their shares directly and must instead instruct the brokerage firm, bank or other nominee how to vote their shares. See “How do I vote my shares?” below.

 

 

How do I vote my shares?

 

If you are a shareholder of record as of March 1, 2010, as opposed to a street name holder, you will be able to vote in four ways: In person, by telephone, by the Internet, or by proxy card.

To vote by proxy card, sign, date and return the enclosed proxy card. To vote by using the automated telephone voting system or the Internet voting system, the instructions for shareholders of record are as follows:

 

TO VOTE BY TELEPHONE: 800-560-1965

 

 

(OR)

 

TO VOTE BY THE INTERNET: www.ematerials.com/dan

 

 

If you submit a proxy to Dana before the Annual Meeting, the persons named as proxies will vote your shares as you directed. If no instructions are specified, the proxy will be voted: i) ”FOR” all of the listed director nominees; and ii) ”FOR” ratification of PricewaterhouseCoopers LLP as the independent registered public accounting firm. In their discretion, the persons named as proxies are authorized to vote (i) for the election of a person to the Board of Directors if any nominee named becomes unable to serve as for good cause will not serve; (ii) for any additional nominee designated by the Board prior to the Annual Meeting; (iii) upon all matters incident to the conduct of the Annual Meeting; and (iv) upon any other business that may properly come before the meeting.

 

You may revoke a proxy at any time before the proxy is exercised by:

 

 

If you hold your shares in “street name,” you must provide voting instructions for your shares in the manner prescribed by your brokerage firm, bank or other nominee. Your brokerage firm, bank or other nominee has enclosed or otherwise provided a voting instruction card for you to use in directing the brokerage firm, bank or other nominee how to vote your shares. If you hold your shares in street name and you want to vote in person at the Annual Meeting, you must obtain a legal proxy from your broker and present it at the Annual Meeting. You will also need to provide to us a brokerage statement if you intend to attend the Annual Meeting.

 

What is a quorum?

 

There were 205,783,192 shares of Dana’s common stock, including Preferred Stock on an as-if-converted basis for voting purposes, issued and outstanding on the Record Date. A majority of the issued and outstanding shares, on an as-if-converted basis, or 102,891,596 shares, present or represented by proxy, constitutes a quorum. A quorum must exist to conduct business at the Annual Meeting.

 

 

What vote is required?

 

Proposal I — Election of Directors:  If a quorum exists, the nominees for Director who receive the most votes will be elected. Votes withheld and broker non-votes (described below) and shares voting “abstain” have no effect on the outcome of the election of directors, because only a plurality of votes actually cast is needed to elect a Director.

 

Proposal II — Ratify the Appointment of the Independent Registered Public Accounting Firm:  If a quorum exists, the proposal to ratify the appointment of the independent registered public accounting firm must receive the affirmative vote of a majority of the shares present in person or represented by proxy at the Annual Meeting and entitled to vote on the proposal. Therefore, abstentions will have the same effect as voting “Against” the proposal. Brokers will have discretionary voting power to vote this proposal so we do not anticipate any broker non-votes (described below). Any shares not voted (whether by abstention or otherwise) will have the same effect as a vote “Against” the proposal.

 

If you hold your shares in street name and do not provide voting instructions to your broker, your shares will not be voted on any proposal on which your broker does not have discretionary authority to vote under the rules of the stock exchange or other organization of which it is a member. In this situation, a “broker non-vote” occurs. Shares that constitute broker non-votes will be counted as present at the Annual Meeting for the purpose of determining a quorum. If you do not provide voting instructions to your broker, under New York Stock Exchange Rules, your broker would have discretionary authority to vote your shares with respect to the ratification of the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm, but would not have discretionary power to vote your shares with respect to the election of Directors.

 

Dana will vote properly completed proxies it receives prior to the Annual Meeting in the way you direct. If you do not specify instructions, the shares represented by those properly completed proxies will be voted (i) to elect the nominees for Directors; and (ii) to ratify the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm. No other matters are currently scheduled to be presented at the Annual Meeting. In their discretion, the persons named as proxies are authorized to vote (i) for the election of a person to the Board of Directors if any nominee named becomes unable to serve as for good cause will not serve; (ii) for any additional nominee designated by the Board prior to the Annual Meeting; (iii) upon all matters incident to the conduct of the Annual Meeting; and (iv) upon any other business that may properly come before the meeting. An independent third party, Wells Fargo Bank, N.A., will act as the inspector of the Annual Meeting and the tabulator of votes.

 

 

Who pays for the costs of the Annual Meeting?

 

Dana pays the cost of preparing and printing the proxy statement and soliciting proxies. Dana will solicit proxies primarily by mail, but may also solicit proxies personally and by telephone, the Internet, facsimile or other means. Dana will use the services of D.F. King & Co., Inc., a proxy solicitation firm, at a cost of $9,500 plus out-of-pocket expenses and fees for any special services. Officers and regular employees of Dana and its subsidiaries may also solicit proxies, but they will not receive additional compensation for soliciting proxies. Dana also will reimburse banks, brokerage houses and other custodians, nominees and fiduciaries for their out-of-pocket expenses for forwarding solicitation materials to beneficial owners of Dana’s common stock and Preferred Stock.

 

How can shareholders nominate individuals for election as directors or propose other business to be considered by the shareholders at the 2011 Annual Meeting of Shareholders?

 

All shareholder nominations of individuals for election as directors or proposals of other items of business to be considered by shareholders at the 2011 Annual Meeting of Shareholders must comply with applicable laws and regulations, including SEC Rule 14a-8, as well as Dana’s Restated Certificate of Incorporation, Bylaws, and Shareholders Agreement, and must be submitted in writing to our Corporate Secretary, Dana Holding Corporation, 3939 Technology Drive, Maumee, Ohio 43537.

 

Under Dana’s bylaws, our shareholders must provide advance notice to Dana if they wish to nominate individuals for election as directors or propose an item of business to be considered by shareholders at the 2011 Annual Meeting of Shareholders. For the 2011 Annual Meeting of Shareholders, notice must be received by Dana’s Corporate Secretary no later than the close of business on January 28, 2011 and no earlier than the close of business on December 29, 2010.

 

If Dana moves the 2011 Annual Meeting of Shareholders to a date that is more than 30 days before or more than 70 days after the date which is the one year anniversary of this year’s Annual Meeting date (i.e., April 28, 2011), Dana must receive your notice no earlier than the close of business on the 120th day prior to the meeting date and no later than the close of business on the later of the 90th day prior to the meeting date or the 10th day following the day on which Dana first makes a public announcement of the meeting date. In no event will a public announcement of an adjournment or postponement of an annual meeting commence a new time period (or extend any time period) for the giving of a shareholder’s notice as described above.

 

If Dana increases the number of directors to be elected to the Board of Directors at the 2011 Annual Meeting of Shareholders and there is no public announcement naming all of the nominees for director or specifying the size of the increased Board of Directors at least 100 days prior to the one year anniversary of this year’s Annual Meeting date (i.e., April 28, 2011), then Dana will consider your notice timely (but only with respect to nominees for any new positions created by such increase) if Dana receives your notice no later than the close of business on the 10th day following the day on which Dana first makes the public announcement of the increase in the number of directors.

 

Notice Requirements to Nominate Individuals for Election to the Board of Directors

 

A shareholder’s notice to nominate individuals for election to the Board of Directors must provide: (A) all information relating to each individual that is required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required, in each case pursuant to and in accordance with Section 14(a) of the Securities Exchange Act of 1934, as amended (the Exchange Act) and the rules and regulations promulgated thereunder, and (B) such person’s written consent to being named in the proxy statement as a nominee and to serve as a director if elected.

 

Notice Requirements for Shareholder Proposals

 

A shareholder’s notice to propose other business to be considered by the 2011 Annual Meeting of Shareholders must provide a brief description of the business desired to be brought before the meeting, the text of the proposal or business (including the text of any resolutions proposed for consideration and in the event that such business includes a proposal to amend the Bylaws, the language of the proposed amendment), the reasons for conducting such business at the meeting and any material interest in such business of such shareholder and the beneficial owner, if any, on whose behalf the proposal is made.

 

Additional Notice Requirements — Shareholder/Beneficial Owner Disclosures

 

Any shareholder or beneficial owner, if any, on whose behalf the nomination or proposal is to be made at the 2011 Annual Meeting of Shareholders must provide (A) the name and address of the shareholder or beneficial owner, (B) the class or series and number of shares of capital stock of Dana which are owned beneficially and of record by the shareholder or beneficial owner, (C) a description of any agreement, arrangement or understanding with respect to the nomination or proposal between or among the shareholder and/or beneficial owner, any of their respective affiliates or associates, and any others acting in concert with any of the foregoing, (D) a description of any agreement, arrangement or understanding (including any derivative or short positions, profit interests, options, warrants, convertible securities, stock appreciation or similar rights, hedging transactions, and borrowed or loaned shares) that has been entered into as of the date of the shareholder’s

notice by, or on behalf of, the shareholder and beneficial owners, the effect or intent of which is to mitigate loss to, manage risk or benefit of share price changes for, or increase or decrease the voting power of, the shareholder or beneficial owner, whether or not such instrument or right will be subject to settlement in underlying shares of capital stock of Dana, with respect to shares of stock of Dana, (E) a representation that the shareholder is a holder of record of stock of Dana entitled to vote at the 2011 Annual Meeting of Shareholders and intends to appear in person or by proxy at the meeting to propose such business or nomination, (F) a representation whether the shareholder or the beneficial owner, if any, intends or is part of a group which intends (1) to deliver a proxy statement and/or form of proxy to holders of at least the percentage of Dana’s outstanding capital stock required to approve or adopt the proposal or elect the nominee and/or (2) otherwise to solicit proxies from shareholders in support of such proposal or nomination, and (G) any other information relating to the shareholder and beneficial owner, if any, required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for, as applicable, the proposal and/or for the election of directors in an election contest pursuant to and in accordance with Section 14(a) of the Exchange Act and the rules and regulations promulgated thereunder.

 

The notice requirements above will be deemed satisfied by a shareholder with respect to business other than a director nomination if the shareholder has notified Dana of his, her or its intention to present a proposal at the 2011 Annual Meeting of Shareholders in compliance with applicable rules and regulations promulgated under the Exchange Act and the shareholder’s proposal has been included in a proxy statement that has been prepared by Dana to solicit proxies for the 2011 Annual Meeting of Shareholders. For the 2011 Annual Meeting of Shareholders, notice must be received by Dana’s Corporate Secretary no later than the close of business on January 28, 2011 and no earlier than the close of business on December 29, 2010. Dana may require any proposed nominee to furnish such other information as it may reasonably require determining the eligibility of the proposed nominee to serve as a director of Dana.

 

Dana’s Bylaws specifying the advance notice and additional requirements for shareholder nomination and shareholder proposal requirements are available on Dana’s website at www.dana.com.

 

 

How many of Dana’s directors are independent?

 

Dana’s Board of Directors has determined that five of Dana’s seven current directors, or approximately 71%, are independent. For a discussion of the Board of Directors’ basis for this determination, see the section of this proxy statement entitled “Director Independence and Transactions of Directors with Dana.”

 

 

Does Dana have a Code of Ethics?

 

Yes, Dana has Standards of Business Conduct for Employees, which applies to employees and agents of Dana and its subsidiaries and affiliates, as well as Standards of Business Conduct for Members of the Board of Directors. The Standards for Business Conduct for Employees and Standards of Business Conduct for Members of the Board of Directors are available on Dana’s website at www.dana.com.

 

 

Is this year’s proxy statement available electronically?

 

Yes. You may view this proxy statement, and the proxy card as well as the 2009 annual report, electronically by going to our website at www.dana.com/2010proxy and clicking on the document you wish to view, either the proxy statement and proxy card or annual report.

 

 

A copy of Dana’s Annual Report on Form 10-K for the fiscal year ended December 31, 2009, as filed with the Securities and Exchange Commission, may be obtained without charge upon written request to the Corporate Secretary, Dana Holding Corporation, 3939 Technology Drive, Maumee, Ohio 43537.

 

Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to Be Held on April 28, 2010.

 

The proxy statement and Dana’s annual report to security holders are available on our website at www.dana.com/2010proxy.

 

Following are the names and ages of the executive officers of Dana, their positions with Dana and summaries of their backgrounds and business experience. For purposes of this Proxy Statement, we have identified our executive officers pursuant to Rules 3b-7 and 16a-1(f) of the Exchange Act. All executive officers are elected or appointed by the Board of Directors and hold office until the annual meeting of the Board of Directors following the annual meeting of shareholders in each year.

 

 

 

This section contains management’s discussion and analysis of Dana’s executive compensation programs, including the objectives of base salary, annual incentives, long term incentives and benefits provided to our executive management in 2009.

 

Objectives and Elements of Dana’s Compensation Program

 

The overall objectives of Dana’s executive compensation program are to attract, motivate, reward and retain talent. The unprecedented challenges of the 2009 economic crisis required Dana management and our Compensation Committee to design a unique compensation program for senior management in 2009 as detailed below. The overall goals of our compensation programs remained the same. We believe that in order to achieve our objectives, our compensation and benefits must be competitive with executive compensation arrangements generally provided to other executive officers at similar levels at other companies where we compete for talent. The various components of Dana’s executive compensation program are designed to:

 

 

The principal elements of our executive compensation are:

 

 

Certain executives, including some of our named executive officers, are also provided with executive employment agreements, supplemental executive retirement plans (SERPs), and change in control agreements, as described in the “Executive Agreements” section below.

 

Administration

 

The Compensation Committee of the Board of Directors assists the Board in fulfilling its obligations related to the compensation of Dana’s executive officers, and in general, with respect to compensation and benefits programs relating to all employees. Our current Compensation Committee consists of a chairman and independent directors who are appointed annually by the Board. Under its Charter, the Compensation Committee must have at least three members. All members must be non-management directors who meet applicable independence requirements under the Exchange Act, the SEC’s rules and regulations, the requirements of the New York Stock Exchange and our Standards of Director Independence. They must also qualify as “non-employee directors” within the meaning of Exchange Act Rule 16b-3 and as “outside directors” for purposes of Section 162(m) of the Internal Revenue Code.

 

The Compensation Committee members during 2009 were: Stephen J. Girsky (Chairman until his resignation from our Board in July 2009); Keith Wandell (Chairman and member since July 2009); Mark A. Schulz; Jerome B. York and David P. Trucano (since July 2009).

 

The Compensation Committee’s responsibilities include, but are not limited to, reviewing our executive compensation philosophy and strategy, participating in the performance evaluation process for our President and Chief Executive Officer (CEO), setting base salary and incentive opportunities for our Executive

Chairman, CEO and other senior executives, establishing the overarching pay philosophy for Dana’s management team, establishing incentive compensation and performance goals and objectives for our executive officers and other eligible executives and management, and determining whether performance objectives have been achieved. The Compensation Committee also recommends to the Board, employment, consulting and severance agreements for key senior executives designated by our CEO with the assistance of our Chief Administrative Officer (CAO). Our CEO and CAO are not members of the Compensation Committee, but review and prepare materials for the Committee and attend portions of committee meetings. Executive sessions are held without the participation of any member of executive management, including the named executive officers.

 

The Compensation Committee retained Frederic W. Cook & Co., Inc. (Cook) for 2009 as an independent advisor to the Compensation Committee to provide limited advice to the Compensation Committee since our management utilizes Towers Watson (formerly Towers Perrin) (Towers) for other compensation and benefits related services, as described below. Dana maintains no other relationship with Cook and Cook provides no additional services to Dana. Our management has also retained Towers for compensation matters related to the Board of Directors.

 

Our executive management as well as the Compensation Committee reviews competitive market data to assist in decision-making regarding Dana’s compensation and benefits programs. Both reviewed market pay data among comparably-sized general industrial companies, as provided by Towers. The market pay data were gathered from Towers’ 2009 U.S. CDB General Industry Executive Database which contains compensation data from over 750 participating companies in the U.S.. For international positions and for certain benefit reviews, we reviewed Global Total Compensation Measurement (TCM) prepared by Hewitt Associates (Hewitt) and Hewitt’s Benefit Index. We do not engage Hewitt for advice or recommendations on executive compensation. Hewitt’s TCM survey contains data for over 600 companies in various international locations. Hewitt’s Benefit Index is a comprehensive report that enables us to compare our benefits programs, grouped in five major benefit areas: retirement income, death, disability, health care, and time off with pay, to those of a group of other employers.

 

Throughout the year as executives were hired, promoted, or experienced job changes, Dana management and the Compensation Committee reviewed the positions based on survey pay data from Towers and, in some cases, Hewitt to establish an appropriate salary range. As part of our normal year-end review process, Dana management worked with Towers to perform an annual review of our competitiveness in relation to base pay, annual incentives and long-term incentives. The survey pay data is used to target market median levels of compensation and benefits in relation to base salary, annual and long term incentives. However, from time to time, Dana may choose to exceed the market median pay range to attract the right talent, but it is our general policy to target the 50th percentile. As we recruit from within and outside of the automotive industry, we use national survey pay data to determine our salary ranges.

 

Base Salaries

 

Base salaries are intended to be market-competitive and to provide a minimum level of guaranteed compensation. The base salaries of the executive officers, including our named executive officers, were determined when they first joined Dana, when they were promoted from within Dana or after other significant changes in an executive’s responsibilities. Dana’s philosophy is to target a range of +/-20% of the 50th percentile, utilizing Towers’ survey pay data. From time to time, when recruiting key talent from other established companies both within and outside of the automotive industry or promoting from within Dana, base salaries could exceed the range, based on the candidate’s current salary or other factors. Our Executive Chairman, CEO and CAO are responsible for making salary recommendations to the Compensation Committee for executive officers, other than with respect to their own salary.

 

During the fourth quarter of 2008, Dana amended and extended the executive employment agreements with Messrs. Devine and Marcin as well as Gary Convis, our Vice Chairman, since their agreements were set to expire during the first part of 2009. As disclosed in our 2009 Proxy Statement, the Compensation Committee retained Cook to assist in setting compensation for these three executives. Cook established a peer

group for the purpose of determining the appropriate pay levels for these three senior executives. The peer group analysis was used as a reference point against general industry market pay data and included a comprehensive executive pay analysis of American Axle & Manufacturing Holdings, Inc.; ArvinMeritor, Inc.; Autoliv, Inc.; BorgWarner Inc; Cummins Inc.; Eaton Corporation; Federal-Mogul Corporation; Lear Corporation; Magna International Inc.; Navistar International Corporation; Tenneco Inc.; TRW Automotive Holdings Corp.; and Visteon Corporation. These companies were selected by Cook and approved by the Compensation Committee since they are within a relevant size range to Dana and also compete in many of the same markets as Dana.

 

In May 2009, Dana entered into an executive employment agreement with Mr. Sweetnam to serve as Dana’s President and CEO succeeding Mr. Devine who had served as Chairman, Chief Executive Officer and President of Dana. Mr. Devine returned to his prior role as Executive Chairman. For a discussion of why Dana chose to split the roles of Executive Chairman and CEO see the “Selection of Chairman and Chief Executive Officer; Succession Planning” section below. In determining Mr. Sweetnam’s base compensation, the Board considered input from Towers, Cook and the most recent proxy statement data for the following companies: American Axle & Manufacturing Holdings, Inc.; TRW Automotive Holdings Corp.; Federal-Mogul Corporation; Visteon Corporation; Lear Corporation; Cummins Inc.; Navistar International Corporation; Eaton Corporation; ArvinMeritor, Inc.; BorgWarner Inc.; Tenneco Inc. and Autoliv, Inc. Again, these companies were utilized since they are within a relevant size range to Dana and also compete in many of the same markets as Dana.

 

During the fourth quarter of 2009, Dana amended and extended for another one-year term the executive employment agreement of Mr. Devine since his agreement was set to expire at the end of 2009. As part of his new agreement, Mr. Devine’s base salary was reduced to $1,000,000 consistent with his role as Executive Chairman rather than the dual position of Executive Chairman and CEO. Mr. Convis elected to retire as our Vice Chairman and resign as a member of our Board effective December 31, 2009. Mr. Convis and Dana subsequently entered into an agreement whereby he became a Senior Advisor to our President and CEO.

 

Annual Incentive Program

 

In early 2009, the automotive industry experienced unprecedented uncertainty and volatility. In addition, the global economy was in the deepest recession since World War II. Based on these factors, and the inherent difficulty in setting performance goals in such an environment, Dana management elected to suspend its customary annual and long term incentive awards programs. Under normal circumstances, our annual incentive program includes target award opportunities established in the first quarter based on established financial metrics for the calendar year with any earned awards being paid in cash during the first quarter of the following year. During this economic crisis, Dana pursued aggressive cost cutting measures through, among other things, eliminated discretionary compensation reward programs globally such as merit increases and COLA programs, where permissible; implemented mandatory unpaid furloughs for salaried and hourly employees (including our entire US-based executive team); eliminated the company contribution under the U.S. 401(k) plan; continued restructuring and realignment of our businesses and continued implementation of our lean-based Dana Operating System (DOS) initiatives.

 

Dana at this time also prepared for an anticipated automotive and global economic recovery by recruiting new talent with proven track records from distinguished companies, focused on improving quality by making major strides in our corporate wide parts per million defective internal goals and further strengthened relationships with our key customers.

 

2009 Special Recognition Programs

 

In December 2009, Dana’s Board of Directors approved two special recognition programs on account of Dana’s 2009 financial and operational results. These one-time programs were a Lump Sum Recognition Payment and a Special Recognition Award.

Lump Sum Recognition Payment

 

Our Board of Directors believed it was appropriate to provide Dana employees, including our named executive officers, who forfeited their 2009 merit pay, participated in unpaid furloughs globally and forfeited contributions under the U.S. 401(k) program, with a one-time lump sum payment equal to 2% of their annual base salary. In many locations, this program included salaried, hourly and union-represented employees who in some cases voluntarily agreed to forego pay increases. While this Lump Sum Recognition Payment did not make up for all of the personal financial sacrifices made by our employees in 2009, it was an expression of appreciation for impacted employees.

 

Special Recognition Award

 

Based on 2009 financial and operational performance during an unprecedented economic period, the Board of Directors also believed it was appropriate to provide an award to employees who would have otherwise been eligible for our annual incentive program that was suspended for 2009. The Special Recognition Award was a one-time program budgeted at approximately 25% of the customary target annual incentive opportunity. Specifically, the Special Recognition Award was payable to incentive eligible employees, including our named executive officers, based on stronger than expected free cash flow and quality results which were both critical given our unprecedented challenges and highly volatile volume levels throughout 2009. The Board gave discretion to our CEO to make awards greater or less than 25% (subject to a zero sum for the group) in the event that individual achievement during 2009 warranted an increase or decrease in an award amount. With respect to our named executive officers, awards ranged from approximately 12.5% to 32% of the customary target annual incentive opportunity.

 

Long Term Incentive Awards and 2009 Long Term Incentive Program

 

Dana believes that long-term incentive awards serve an important role by balancing short term goals with long term shareholder value creation and minimize risk taking behaviors that could negatively affect long term results. All awards are made pursuant to the 2008 Dana Holding Corporation Omnibus Incentive Plan.

 

2009 Long Term Incentive Award

 

As stated above, 2009 provided unprecedented economic challenges, and in particular, unique volatility in the automotive industry. As a result of such uncertainty, we elected not to make our customary annual long-term incentive grants (2009 LTIP). In lieu of the customary 2009 LTIP, the Board of Directors approved a stock option grant in March 2009 for approximately 150 senior management employees who would have been participants in the 2009 LTIP, including many of our named executive officers (except Messrs. Devine, Sweetnam, Convis and Marcin). Messrs. Devine, Convis and Marcin did not receive this grant because they previously received a long term incentive grant in conjunction with their executive employment agreement extensions in October 2008. Mr. Sweetnam became our President and CEO after the grant was made. His specific long-term incentive grants are discussed below.

 

Our normal practice is to grant long term incentive awards based on a fair market value calculation using a Black-Scholes valuation. On account of both the volatility in the price of our common stock as well as the depressed market value of our common stock during the first quarter of 2009, it would have been imprudent to use this method to determine the size of the long term incentive grant as it would have resulted in an inordinately large number of shares being granted. Instead, Dana elected to grant stock options, valued at approximately 15% of the normal grant date fair value. Rather than using the value of the opportunity method described above that is based on a specific multiple of an executive’s base salary to calculate the number of options to grant, it was decided to vary the size of the award for key employees by the number of options granted rather than by value of the opportunity. These stock options, granted in March 2009, have a contractual term of 10 years and vest in one-third increments on each of the first three anniversaries of the grant date.

2008 Performance Share Award

 

As previously disclosed, Dana granted performance shares in 2008. These grants could be earned in 25% increments in 2008 and 2009 and the final 50% in 2010 based on meeting or exceeding certain financial performance metrics. The 2008 tranche was forfeited since we did not meet the performance metrics set by the Compensation Committee. The Compensation Committee set the 2009 tranche performance measure in 2009 based on achieving certain financial target performance goals, which were Adjusted EBITDA (50% weighted) and Free Cash Flow or “FCF” (50% weighted). “Adjusted EBITDA” is earnings before interest, taxes, depreciation, amortization, non-cash equity grant expense, restructuring expense and other nonrecurring items (gain/loss on debt extinguishment or divestitures, impairment, etc.). By using Adjusted EBITDA, which is a performance measure that excludes depreciation and amortization, the comparability of results is enhanced. Management also believes that Adjusted EBITDA is an important measure since the financial covenants of our primary debt agreements are Adjusted EBITDA-based. FCF is defined as cash provided by operations exclusive of any bankruptcy claim-related payments included therein, less capital spending. This measure is useful in evaluating the operational cash flow of Dana inclusive of the spending required to maintain the operations. Our Adjusted EBITDA target for the 2009 tranche was $295 million and FCF target was $1 million. The Board determined during the first quarter of 2010 that the 2009 tranche was earned at target-level based on meeting both targets. Messrs. Devine, Convis and Sweetnam did not participate in this program.

 

2008 Performance Share Award to Messrs. Devine, Convis and Marcin

 

As previously disclosed in our 2009 Proxy Statement, a separate performance share grant was made to Messrs. Devine, Convis and Marcin on October 31, 2008. The Compensation Committee set certain goals in 2008 to be met by these executives in order for any award to vest. Mr. Devine’s goals included, but were not limited to, succession planning (including hiring his successor as CEO and President), building management capability as Dana continued to restructure, achieving 2009 plan objectives and developing the next phase of Dana’s strategic plans to build shareholder value. Mr. Convis’ goals included, but were not limited to, exceeding plant conversion cost targets, inventory cost reduction, talent acquisition, customer relations and implementation of lean manufacturing systems and processes. Mr. Marcin’s goals included, but were not limited to succession planning (including hiring Mr. Devine’s successor as CEO and President), hiring remaining executive committee members, implementing cost reduction initiatives in response to the economic crisis, continuing employee restructuring activities and reducing human resources transaction costs by over $4 million annually.

 

Our Board determined each of these executives met his performance targets at target level and the performance shares vested on December 16, 2009 with the first one-third awarded on that date and the remaining portion of the award to be paid in equal increments on the second and third anniversaries of the award, respectively.

 

2009 Awards to Mr. Sweetnam

 

As noted above, Mr. Sweetnam was hired in July 2009 as our President and CEO. Mr. Sweetnam received a long term incentive grant consisting of stock options and restricted stock units as well as a cash payment to be used to buy Dana common stock as part of his negotiated executive employment agreement. Additional information regarding these awards is set forth in the “Executive Agreements” section below. These awards were made i) as an inducement to join Dana, ii) to make up for forfeited incentive awards from his prior employer and iii) in lieu of the existence of a 2009 long term incentive grant at Dana. Many factors were considered in determining the appropriate long term incentive grant for Mr. Sweetnam, including the potential future value of the award, encouraging him to forego outstanding compensation awards at his previous employer and his previous employer’s record of consistently paying incentive compensation in recent years.

 

Equity awards granted for each of our named executive officers are set forth in the “Grants of Plan-Based Awards” table below.

Equity-Based Grant Practices

 

Under our equity-based granting practices, Dana makes regular equity-based grants to eligible employees, including named executive officers, in the first quarter of the calendar year at a regularly scheduled meeting of the Compensation Committee. Under our current practice, the exercise price, in the case of stock options, is the closing price of our common stock on the New York Stock Exchange on the day of the grant. Dana also may award equity-based grants during the year to newly hired executive officers as part of their compensation package or to executives based on a promotion during the year. In the case of equity-based grants to newly hired employees who may be executive officers within the meaning of Section 162(m) of the Internal Revenue Code (Covered Employees), or officers subject to Section 16 of the Exchange Act (Section 16 Officers), including named executive officers, the grants are authorized by the Compensation Committee.

 

Mitigation of Potential Risk in Pay Programs

 

We have reviewed our compensation policies and practices and determined that none are reasonably likely to have a material adverse effect on Dana. In order to avoid excessive risk taking behaviors, Dana has put into place several mechanisms including but not limited to stock ownership guidelines, caps on annual incentive payouts, financial performance-based annual incentive programs, long term incentive awards (which are delivered primarily in the form of equity), policies regarding multiple types of awards, and a practice of using multiple metrics to determine annual and long term incentive payouts. Stock ownership guidelines, as discussed below, encourage our executives to maintain a certain level of company ownership, thus encouraging them to have an interest in the long term success of the company. Long term incentive awards such as restricted stock units or performance shares or equity acquired externally count toward our stock ownership guidelines. Annual incentive payouts are capped at 250% of target to avoid decisions that may lead to an exorbitant payout in one year to the detriment of performance in following years. In addition, our 2008 Omnibus Incentive Plan has a “clawback” provision related to payments made in the event of financial restatements.

 

Dana believes it is important to align the interests of its senior officers with those of our shareholders through ongoing stock ownership. Dana adopted stock ownership guidelines to encourage senior officers to own a significant number of shares of Dana’s common stock. The stock ownership guidelines are calculated based on a multiple of the senior officer’s annual base salary. Dana encourages its senior officers to achieve the targeted stock ownership levels within 5 years of being promoted or named to the applicable senior officer position.

		Minimum Investment
Title		(Multiple of Base Salary)
Chief Executive Officer			5
Members of the Executive Committee			3
Vice Presidents			1

 

Employment Agreements

 

Dana determined it was necessary to offer executive employment agreements in certain limited circumstances to attract senior executives to Dana or encourage them to remain with Dana and forego retirement or other opportunities. As a result, Dana entered into executive employment agreements with Messrs. Devine, Sweetnam, Convis, Yost and Marcin on the terms further discussed under the “Executive Agreements” section below.

 

Severance Arrangements

 

Under limited circumstances, we offer severance benefit arrangements for senior executives in connection with their departure from Dana. These arrangements allow Dana and the former executive to agree upon the final terms of the executive’s service to Dana, providing both Dana and the former executive certainty as to their rights and obligations to each other, including restrictive covenants, non-compete agreements and

consulting services. Our former President, Heavy Vehicle Products Group, Mr. Stanage, entered into a severance agreement during 2009. The terms of Mr. Stanage’s agreement are further discussed under the “Executive Agreements” section below.

 

Severance Plan/Change in Control

 

Dana adopted an Executive Severance Plan (Executive Severance Plan) in 2008. Each of our current named executive officers (except Messrs. Devine, Convis and Marcin with respect to ‘change-in-control’ related payments) participates under the Executive Severance Plan. The Executive Severance Plan was adopted in order to provide severance pay to eligible executives whose employment is terminated (i) prior to or within a specified period of time following a change in control or (ii) for a reason other than cause, death, total disability or voluntary resignation. Dana believes that such a plan helps to attract and retain executives by reducing the personal uncertainty that arises from the possibility of a future business combination or restructuring. Moreover, the Executive Severance Plan is designed to offset the uncertainty of executives regarding their own futures if a change in control or termination actually occurs. Dana believes that the Executive Severance Plan helps to increase shareholder value by encouraging the executives to consider change in control transactions that are in the best interest of Dana and its shareholders, even if the transaction may ultimately result in their termination of employment.

 

The Executive Severance Plan included a conditional excise tax gross-up provision, such that if the executive incurred any excise tax by reason of his or her receipt excess parachute payment, as defined in Section 280G of the Internal Revenue Code (Section 280G), the executive would be entitled to a gross-up payment only if the aggregate excess parachute payments exceeded 120% of the respective 280G limit. The amount of the gross-up payment would place the executive in the same after-tax position he or she would have been in had no excise tax applied. Under the Executive Severance Plan, Dana is required to reduce the executive’s change in control benefits by up to 20% of the 280G limit if doing so would avoid imposition of the Section 280G excise tax for the executive.

 

In 2009, all of our named executive officers who were eligible for the change in control severance benefit voluntarily waived the excise tax gross up provision excluding Mr. Yost, whose severance benefit is outlined in his executive employment agreement. As a result, any eligible executive officers would receive the better of the following change in control payments on an after-tax basis: i) change in control payment less excise tax (paid by executive), if the payment is deemed to be an excess parachute payment, and less other applicable income taxes or ii) change in control payment reduced to an amount such that an excise tax payment is not in effect, less other applicable income tax. If the excess parachute amount is not triggered, the change in control payment is not affected by any excise tax.

 

For more information on the terms and conditions of the change in control payments to certain of Dana’s named executive officers under the Executive Severance Plan, see the section entitled “Potential Payments upon Termination or Change in Control.”

 

Perquisites and Other Benefits

 

Executive Perquisites Plan

 

We have adopted an Executive Perquisites Plan that provides for an annual cash allowance to eligible employees (including our named executive officers) in lieu of individual executive perquisites. We determined that it was in Dana’s best interest to provide a cash allowance, in lieu of administering perquisite benefits, as part of a competitive pay package, which assists in recruiting and retaining talented executives from other companies that offer similar benefits. A fixed cash allowance also reduces costs to Dana of administering the various components of a perquisites program. Our Executive Chairman receives $75,000 per year. Our CEO is entitled to $100,000 annually and the remaining named executive officers are entitled to $35,000 annually.

Aircraft Usage

 

Pursuant to Messrs. Devine’s and Convis’ 2009 executive employment agreements, Dana paid transportation expenses to their residences in California, including use of a private aircraft. These arrangements were made to encourage them to join Dana while their residence and family remained in California and in lieu of relocation and home purchase assistance. This benefit is treated as taxable compensation for which Dana reimburses each of Messrs. Devine and Convis for the amount of the tax obligation. Dana utilized a service through which it pre-purchased flight hours for both executives.

 

Messrs. Devine and Convis voluntarily discontinued use of the private aircraft in May 2009 and began flying commercial aircraft only. Further, Mr. Devine’s executive employment agreement effective January 1, 2010, allows for commercial aircraft reimbursement only. The benefit will continue to be taxable compensation for which Dana will reimburse Mr. Devine for the amount of the tax obligation.

 

The aggregate cost of this benefit for both Mr. Devine and Mr. Convis is described further under the “Summary Compensation Table” below.

 

Use of Corporate Housing

 

Through August 2009, Dana owned three houses located on our former corporate campus in Toledo that historically were used by executive management for temporary housing and as meeting venues. These properties were sold in September 2009. In order to accommodate our need for temporary housing and in lieu of renting commercial hotel rooms, Dana has entered into an agreement to rent space in the houses from the new owner. Currently, Messrs. Devine, Convis, Marcin and Sweetnam utilize these houses. In addition, other non-local executives have stayed at these facilities on an infrequent basis when working in Toledo in lieu of purchasing hotel rooms.

 

Automotive Transportation Service

 

We provide our Executive Vice President and Chief Financial Officer, Mr. Yost, with access to automotive transportation service between his home located in the Detroit metropolitan area and our corporate headquarters in Maumee. We provide this benefit to Mr. Yost in lieu of relocation to the Toledo area. In addition, this benefit allows Mr. Yost to more efficiently and effectively conduct company business and do it in a safer manner while commuting approximately three hours a day.

 

Relocation Assistance

 

On a limited basis, Dana offers relocation benefits to our employees and new hires. The benefits under this program generally include some or all of the following benefits as needed; pre-commitment visits, miscellaneous expense allowances, tax assistance, home sale assistance, home purchase closing costs, household goods shipping, and temporary living expenses. Dana provides relocation benefits to encourage employees to relocate, sell their homes, help ease and accelerate the transition time for the employee and the family, and help employees remain focused on the business of Dana rather than on personal relocation issues. Our CEO and President, Mr. Sweetnam, and our CAO, Mr. Marcin, utilized the relocation program during 2009.

 

For more information on the benefits provided to Messrs. Sweetnam and Marcin, see the “Summary Compensation Table” and related footnotes below.

 

Special Reimbursement

 

Mr. Wallace was a participant in his previous employer’s deferred compensation program. As an inducement to join Dana, we agreed to compensate Mr. Wallace for benefits he forfeited when he departed from his previous employer and in light of the fact that Dana does not have a deferred compensation program. Because some of these payments were considered immediately taxable to Mr. Wallace, Dana agreed to provide a tax gross up when negotiating Mr. Wallace’s pay package to join Dana.

For more information on the benefits provided to Mr. Wallace, see the “Summary Compensation Table” and related footnotes below.

 

Additional Benefits

 

Dana provides additional benefits to attract and retain employees and to encourage employees to save money for their retirement. Dana’s standard U.S. retirement benefit consisted of a basic contribution equal to 3% of base salary through March 2009 into our Savings Works 401(k) plan, which was subject to the IRS 402(g) contribution limit of $7,350 for any eligible employee. Given the unprecedented economic situation generally, and particularly in the automotive industry, Dana discontinued the company basic 401(k) contribution equal to 3% of base salary effective April 1, 2009. No additional make-up contributions were made beyond this level to named executive officers. All eligible employees are able to contribute to the Savings Works 401(k) plan on a before and after tax basis. In 2009, the Savings Works 401(k) plan did not offer a 401(k) company matching contribution and, therefore, none of our named executive officers or other participating employees received a 401(k) company matching contribution.

 

Effective January 1, 2010, Dana established a “safe harbor” 401(k) plan, the Dana Retirement Savings Plan (the Plan). Under the terms of the Plan, Dana matches 100% of the employee’s contributions up to 3% of compensation and 50% of the employee’s contributions from 3% to 5% of compensation. Overall, this arrangement provides a maximum match of 4% of an employee’s contribution to an employee who contributes 5% of pay.

 

For purposes of determining Dana’s matching contribution, the compensation under the Plan is limited to the annual IRS qualified plan limit in effect for calendar year 2010, or $245,000. In addition, the maximum combined contribution of pre-tax and Roth contributions for 2010 is $16,500 (plus a $5,500 catch-up contribution for participants reaching age 50 by the end of 2010). At this time, we do not provide our executives with an opportunity to increase deferrals or receive credit under a nonqualified 401(k) plan that allows for consideration of compensation above $245,000.

 

On a limited basis, Dana has agreed to provide Supplemental Executive Retirement Plans (SERPs) to certain executives as part of their initial terms of employment. In most cases, when a SERP benefit was offered, it was to replace the executive’s existing retirement benefit forfeited when the executive left an employer to join Dana. For more information regarding SERPs, see the narrative following the “Pension Benefits” table below.

 

Adjustment of Performance-Based Compensation

 

In order to mitigate risk to Dana of paying either annual or long term incentives based on faulty financial results, we have a policy (Clawback Policy) regarding adjustment of performance-based compensation in the event of a restatement of our financial results that provides for the Compensation Committee to review all bonuses and other compensation paid or awarded to our executive officers based on the achievement of corporate performance goals during the period covered by a restatement. If the amount of such compensation paid or payable to any executive officer based on the originally reported financial results differs from the amount that would have been paid or payable based on the restated financial results, the Compensation Committee makes a recommendation to the independent members of the Board as to whether to seek recovery from the officer of any compensation exceeding that to which he or she would have been entitled based on the restated results or to pay to the officer additional amounts to which he or she would have been entitled based on the restated results, as the case may be.

 

Impact of Accounting and Tax Treatments

 

Deductibility of Executive Compensation

 

Our objective is to comply with Section 162(m) of the Internal Revenue Code (Code), unless the Compensation Committee determines that it is in Dana’s best interests in unique circumstances to provide compensation to a “covered employee” that is not tax-deductible. From time to time, the Compensation

Committee approves compensation that does not meet the Section 162(m) requirements in order to ensure competitive levels of compensation for our senior executives or to recognize unique contributions and accomplishments, as was the case in 2009 regarding the Board’s approval of a Special Recognition Award payable to the bonus eligible employees, including our named executive officers, based on stronger than expected free cash flow and quality results which were critical for Dana in 2009 given unprecedented challenges with unpredictable customer volume levels.

 

In addition, for 2009, a portion of the compensation shown in the Summary Compensation Table for Messrs. Devine, Sweetnam and Convis in excess of $1,000,000 was not deductible for federal income tax purposes.

 

Accounting for Stock-Based Compensation

 

We account for stock-based payments under our equity-based plans in accordance with the requirements of FASB ASC Topic 718 (formerly SFAS No. 123(R)). There is more information about this accounting treatment in Note 9 to our Consolidated Financial Statements in Dana’s Annual Report on Form 10-K for the year ended December 31, 2009.

 

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis (CD&A) with management. Based on this review and discussion, the Compensation Committee recommended to the Board of Directors that the CD&A be included in this Proxy Statement and incorporated by reference into our Annual Report on Form 10-K.

 

Compensation Committee

 

Keith E. Wandell, Chairman

Mark A. Schulz

David P. Trucano

Jerome B. York

 

March 2, 2010

The following table summarizes the compensation of our Executive Chairman, President and CEO, Executive Vice President and CFO and our three other most highly compensated executive officers serving at the end of the fiscal year ended December 31, 2009 as well as certain other former executive officers for which disclosure is required for the 2009 fiscal year (collectively, the named executive officers) for services rendered during the years in all capacities to Dana and our subsidiaries.

 

																										Change in
																										Pension
																										Value and
																										Nonqualified
																						Non-Equity				Deferred
														Stock				Option				Incentive Plan				Compensation				All Other
Name and						Salary				Bonus(7)				Awards				Awards				Compensation(10)				Earnings				Compensation				Total
Principal Position(1)		Year(6)				($)				($)				($)(8)				($)(9)				($)				($)				($)(11)(12)(13)				($)
John M. Devine(2)			2009				1,298,077				500,000				0				0				0				0				790,412				2,588,489
Executive Chairman			2008				916,667				1,500,000				950,000				5,092,000				0				0				1,208,078				9,666,745
James E. Sweetnam			2009				480,769				2,175,000	(14)			274,000				1,230,000				0				0				185,264				4,345,033
President and Chief Executive Officer
James A. Yost			2009				576,923				125,000				0				97,500				0				114,199	(17)			69,080				982,702
Executive Vice President and Chief Financial Officer			2008				365,909				651,440				1,092,725				1,197,014				0				66,282				172,880				3,546,250
Gary L. Convis(3)			2009				961,538				250,000				0				0				0				0				298,055				1,509,593
Vice Chairman			2008				850,000				1,515,356				285,000				3,581,022				0				0				1,311,671				7,543,049
Mark E. Wallace			2009				390,384				100,000				0				40,500				0				0				404,518				935,402
President — Heavy Vehicle Group
Robert H. Marcin			2009				519,231				225,000	(15)			0				0				0				0				92,151				836,382
Executive Vice President and Chief Administrative Officer			2008				458,333				125,000				681,250				1,771,897				0				0				82,364				3,118,844

 

SUMMARY COMPENSATION TABLE FOR FORMER EXECUTIVE OFFICERS

 

																										Change in
																										Pension
																										Value and
																										Nonqualified
																						Non-Equity				Deferred
														Stock				Option				Incentive Plan				Compensation				All Other
Name and						Salary				Bonus				Awards				Awards				Compensation(10)				Earnings				Compensation				Total
Principal Position(1)		Year(6)				($)				($)(7)				($)(8)				($)(9)				($)				($)				($)(11)(12)(13)				($)
Ralf Goettel(4)(5)			2009				461,280				495,991	(16)			0				13,500				0				47,923	(18)			41,548				1,060,242
Vice President — Global			2008				444,106				0				450,491				337,886				0				110,277				66,478				1,409,238
Engineering and Business			2007				445,446				0				0				0				1,333,127				25,995				35,289				1,839,857
Development — Sealing and Thermal Products
Nick L. Stanage(19)			2009				337,821				0				0				45,000				0				0				1,642,452				2,025,273
President — Heavy Vehicle Products			2008				410,167				0				543,837				350,623				0				84,597				96,397				1,485,621

 

Footnotes:

 

 

 

 

 

 

 

 

 

The following table contains information on grants of awards to named executive officers in the fiscal year ended December 31, 2009 under Dana’s Plan.

 

All Other

All Other

Stock

Option

Grant

Awards:

Awards:

Exercise

Date Fair

Estimated Future Payouts

Number of

Number of

or Base

Value of

Estimated Future Payouts Under

Under Equity Incentive Plan

Shares of

Securities

Price of

Stock and

Non-Equity Incentive Plan Awards(2)

Awards(3)(4)

Stock or

Underlying

Option

Option

Grant

Threshold

Target

Maximum

Threshold

Target

Maximum

Units

Options

Awards

Awards

Name

Date(1)

($)

($)

($)

(#)

(#)

(#)

(#)

(#)

($/Sh)(8)

($)(9)

John M. Devine(1)

—

James E. Sweetnam

—

7/1/09

200,000

(5)

274,000

7/1/09

1,500,000

(6)

1.37

1,230,000

James A. Yost

—

3/18/09

325,000

(7)

0.51

97,500

Gary L. Convis(1)

—

Mark E. Wallace

—

3/18/09

135,000

(7)

0.51

40,500

Robert H. Marcin(1)

—

Ralf Goettel

—

3/18/09

45,000

(7)

0.51

13,500

Nick L. Stanage

—

3/18/09

150,000

(7)

0.51

45,000

 

Footnotes:

 

 

2008 Dana Holding Corporation Omnibus Incentive Plan.  The 2008 Dana Holding Corporation Omnibus Incentive Plan (the Plan) is administered by the Compensation Committee. The Compensation Committee may grant stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards and other stock-based and non-stock based awards under the Plan.

The maximum number of shares of Dana’s common stock available under the Plan is 16,090,000 shares. Any shares related to awards that terminate or are forfeited are added back to the pool. The aggregate number of shares of common stock actually issued or transferred by Dana upon the exercise of incentive stock options may not exceed 4,000,000 shares. We have not granted any incentive stock options under the Plan. Further, no participant may be granted option rights or appreciation rights for more than 2,000,000 shares of common stock during any calendar year, subject to adjustments as provided in the Plan. In no event may any participant receive restricted shares, restricted stock units or performance shares in the aggregate for more than 1,000,000 shares of common stock during any calendar year, or receive an award of performance units having an aggregate maximum value as of their respective dates of grant in excess of $10,000,000. The maximum number of shares that may be granted under the Plan is subject to adjustment in the event of stock dividends, stock splits, combinations of shares, recapitalizations, mergers, consolidations, spin-offs, reorganizations, liquidations, issuances of rights or warrants, and similar events. No grants may be made under the Plan after December 25, 2017.

 

Under the Plan, the Board of Directors may also, in its discretion, authorize the granting to non-employee directors of option rights and appreciation rights and may also authorize the grant of other types of awards. Upon a change in control of Dana, except as otherwise provided in the terms of the award or as provided by the Compensation Committee, to the extent outstanding awards are not assumed, converted or replaced by the resulting entity, all outstanding awards that may be exercised will become fully exercisable, all restrictions with respect to outstanding awards will lapse and become fully vested and non-forfeitable, and any specified performance measures with respect to outstanding awards will be deemed to be satisfied at target levels.

 

The following table provides information on stock option, stock appreciation rights, restricted stock unit and performance share grants awarded pursuant to the Plan for each named executive officer and as outstanding as of December 31, 2009. Each outstanding award is shown separately. The market value of the stock awards is based on the closing market price of Dana common stock on December 31, 2009 of $10.84 per share.

 

		Option Awards																	Stock Awards
																											Equity Incentive				Equity Incentive
		Number																									Plan Awards:				Plan Awards:
		of				Number of																	Market Value				Number of				Market or
		Securities				Securities													Number of				of Shares or				Unearned				Payout Value of
		Underlying				Underlying													Shares or				Units of				Shares,				Unearned Shares,
		Unexercised				Unexercised				Option									Units of Stock				Stock That				Units or Other				Units or Other
		Options				Options				Exercise				Option					That Have				Have Not				Rights That				Rights That
		(#)				(#)				Price				Expiration					Not Vested				Vested				Have Not				Have Not
Name		Exercisable				Unexercisable				($)				Date					(#)				($)				Vested (#)				Vested ($)
John M. Devine			533,333				266,667	(1)			12.75				2/4/18
			333,333				666,667	(2)			1.90				10/31/18					166,667	(10)			1,806,670				166,667	(14)			1,806,670
James E. Sweetnam							1,500,000	(3)			1.37				7/1/19					200,000	(11)			2,168,000
James A. Yost			85,781								12.25				5/13/18													31,225	(15)			338,479
			47,486				94,972	(4)			12.25				5/13/18
							325,000	(5)			.51				3/18/19
Gary L. Convis							0	(6)			10.06				3/28/18					0	(12)			35,924
			3,787				0	(7)			10.06				1/30/10
			255,633				511,267	(8)			10.00				4/16/18
			100,000				200,000	(2)			1.90				12/31/14
															10/31/18					50,000	(10)			542,000				50,000	(14)			542,000
Mark Wallace							135,000	(5)			.51				3/18/19
			12,833				25,667	(9)			2.09				11/3/18					5,000	(13)			54,200				8,500	(15)			92,140
Robert H. Marcin			127,808				255,616	(8)			10.00				4/16/18													28,125	(15)			304,875
			41,666				83,334	(2)			1.90				10/31/18					20,834	(10)			225,841				20,834	(14)			225,841
Ralf Goettel			25,714				51,429	(8)			10.00				4/16/18													16,895	(15)			183,142
							45,000	(5)			.51				3/18/19
Nick L. Stanage			26,683				0	(8)			10.00				4/30/10													0	(15)
							0	(5)			.51				3/18/19

 

Footnotes:

 

 

 

 

The following table provides information concerning the exercise of stock options and the vesting of performance shares and restricted stock units, during the fiscal year ended December 31, 2009, for each of the named executive officers. None of the named executive officers exercised any Dana stock options during 2009.

 

		Option Awards									Stock Awards
		Number of									Number of
		Shares									Shares
		Acquired				Value Realized					Acquired				Value Realized
		on Exercise				on Exercise					on Vesting				on Vesting
Name		(#)				($)					(#)				($)
John M. Devine												83,333	(1)			471,665	(5)
												83,333	(2)			783,330	(6)
James A. Yost												15,612	(9)			184,378	(10)
Gary L. Convis												1,656	(3)			811	(7)
												25,000	(1)			141,500	(5)
												25,000	(2)			235,000	(6)
Mark Wallace												5,000	(4)			30,300	(8)
												4,250	(9)			50,193	(10)
Robert H. Marcin												10,416	(1)			58,955	(5)
												10,416	(2)			97,910	(6)
												14,063	(9)			166,084	(10)
Ralf Goettel												8,447	(9)			99,759	(10)

 

Footnotes:

 

 

 

The following table contains information with respect to the plans that provide for payments or other benefits to our named executive officers at, following, or in connection with retirement. The number of years of credited service and the actuarial present values in the table are computed as of December 31, 2009, the pension plan measurement date used for reporting purposes with respect to our Consolidated Financial Statements in Dana’s Annual Report on Form 10-K for the year ended December 31, 2009. Messrs. Devine, Convis, Marcin, Sweetnam and Wallace do not participate in any pension or supplemental retirement plans.

 

				Number of				Present				Payments
				Years				Value of				During
				Credited				Accumulated				Last Fiscal
				Service				Benefit				Year
Name		Plan Name		(#)				($)				($)
James A. Yost		Supplemental Executive Retirement Plan			1.6137				180,481	(1)			0
Ralf Goettel		German Pension Benefit Obligation			16				620,615	(2)			0
Nick L. Stanage		Supplemental Executive Retirement Plan			4				1,047,750	(3)			0

 

Footnotes:

 

 

 

Pension and Retirement Plans

 

Mr. Yost is eligible to receive a non-qualified supplement retirement benefit under his supplemental executive retirement plan that was created when he became our Executive Vice President and Chief Financial Officer in May 2008. Under the terms of Mr. Yost’s supplemental executive retirement plan, Dana created a notional defined contribution account that is unfunded and subject to the claims of Dana’s general creditors. Dana credits Mr. Yost’s account as follows: (a) 20% of Mr. Yost’s annual base pay; and (b) 20% of Mr. Yost’s annual incentive plan award; less (c) the basic credit provided to Mr. Yost under Dana’s SavingsWorks (401(k)) plan (without regard to any matching contributions). Dana credits the accumulated balance in his account with an annualized return of 5% compounded annually. Once Mr. Yost satisfies a three-year vesting requirement, he will be eligible to receive the accumulated balance of his account when his employment with Dana ceases. Additionally, after three years of service with Dana, or when, if earlier, while employed by Dana, Mr. Yost: (a) dies; (b) becomes disabled; (c) is terminated without cause; or (d) resigns for good reason, Mr. Yost’s interest in his account will vest and the accumulated balance will be payable to him (or his beneficiary in the event of death) in a lump sum amount on his termination of employment.

 

Under the terms of Mr. Goettel’s German Pension Benefit Obligation Plan, if he continues employment with Dana to normal retirement age, as determined by German law, he will receive a retirement benefit of $1,644,796. If Mr. Goettel terminates his employment, either voluntarily or involuntarily, the contribution to his pension plan will be discontinued, but the benefit would be available to him at normal retirement age. If Mr. Goettel dies, his widow would be entitled to 100% of the pension value on the date of his death. If Mr. Goettel dies and he does not have a widow, his child would receive 50% of the pension value at the date of his death, if the child is under 18 years of age or under 27 years of age and attending an educational institute. If none of these situations is the case, the pension value remains with Dana.

 

Mr. Stanage had an individual supplemental executive retirement plan designed to provide him with certain non-qualified retirement benefits forfeited when he terminated his prior employment to join Dana. Under the terms of Mr. Stanage’s plan, if he continued employment with Dana to his normal retirement age

(age 62), he would have received a normal retirement benefit of $2,095,500 payable in a lump sum. If Mr. Stanage died, became disabled or was involuntarily terminated from employment by Dana for any reason other than “cause” (as defined in the plan) before he reached age 62, he (or his estate) would have been entitled to a portion of his normal retirement benefit (not exceeding 100%) equal to the greater of (i) his normal retirement benefit multiplied by a fraction, the numerator of which is his years of credited service (as shown in the above table) and the denominator of which is 15 and 4/12, or (ii) 50% of his normal retirement benefit. Mr. Stanage resigned from Dana on October 31, 2010 which was treated as an involuntarily termination. As discussed above in footnote 12 to the Summary Compensation Table, Mr. Stanage was eligible for a partial benefit of $1,047,750.

 

We entered into initial executive employment agreements with Messrs. Devine, Convis and Marcin in April 2008. As described above in the “Compensation Discussion and Analysis” section, we extended and amended these agreements by executing new executive employment agreements with Messrs. Convis, Devine and Marcin effective January 1, 2009. On January 1, 2010, Dana and Mr. Devine extended his executive employment agreement for an additional term; Mr. Convis elected to retire on December 31, 2009. We entered into an executive employment agreement with Mr. Sweetnam in July 2009 and Mr. Yost in May 2008.

 

John Devine

 

In connection with Mr. Devine’s appointment as Chairman, Chief Executive Officer and President, Dana executed an executive employment agreement effective January 1, 2009. Our Board of Directors approved the following compensation arrangement:

 

 

As described in the “Compensation Discussion and Analysis” section above, Dana executed a new executive employment agreement effective January 1, 2010. Our Board of Directors approved the following compensation arrangement:

 

 

Gary Convis

 

In connection with Mr. Convis’ appointment as Vice Chairman, Dana executed an executive employment agreement effective January 1, 2009. Our Board of Directors approved the following compensation arrangement:

 

 

 

As described in the “Compensation Discussion and Analysis” section above, Dana executed an agreement with Mr. Convis effective January 1, 2010. Our Board of Directors approved the following compensation arrangement:

 

 

Robert Marcin

 

Under the terms of his January 2009 executive employment agreement approved by our Board of Directors, Mr. Marcin is entitled to the following:

 

 

James Sweetnam

 

Under the terms of his July 2009 executive employment agreement approved by our Board of Directors, Mr. Sweetnam is entitled to the following:

 

 

 

James Yost

 

In connection with Mr. Yost’s appointment as Executive Vice President and Chief Financial Officer, Dana executed an executive employment agreement in May 2008 with Mr. Yost approved by the Board of Directors. Under the terms of the executive employment agreement, Mr. Yost is entitled to the following:

 

 

Mr. Yost’s executive employment agreement also provides for certain payments in the event that Mr. Yost’s position with Dana is involuntarily terminated by Dana without cause or he resigns for ‘good reason’.

 

As discussed in the “Compensation Discussion and Analysis” section above, Dana adopted an Executive Severance Plan that applies to certain senior executives, including our named executive officers. During 2008, Messrs. Devine, Convis and Marcin waived change in control payments they might be entitled to under the Executive Severance Plan described below. As discussed above under the caption “Executive Agreements”, these three executives were parties to executive employment agreements during 2009 with Dana containing the potential payments and benefits they are eligible for upon termination or change in control which are discussed below. Mr. Stanage entered into a severance agreement with us upon his departure from Dana in 2009.

 

Set forth below is a description of our Executive Severance Plan (applicable to eligible executive officers, including named executive officers, but excluding Messrs. Devine, Convis and Marcin as to “change in control” provisions) as well as a description of the severance agreement with Mr. Stanage. This is followed by tables relating to Messrs. Devine, Sweetnam, Yost, Marcin, Wallace and Goettel as well as a description of what compensation and benefits Mr. Convis was entitled to as a result of his retirement from Dana on December 31, 2009.

 

Executive Severance Plan

 

Change in Control.  All eligible executive officers, except our CEO, who incur a qualifying termination will be entitled to receive two years of salary and twice his or her target bonus for the year in which termination occurs. Our CEO is entitled to receive three years of salary and three times his target bonus for the year in which termination occurs. In addition, each named executive officer will be entitled to: (1) the full amount of any earned but unpaid base salary through the date of termination plus a cash payment for all unused vacation time accrued as of the termination date; (2) a pro rata portion of his or her annual bonus for the year in which termination occurs; (3) all equity awards held by a terminated eligible employee all of which vest in full and become fully exercisable as of the termination date; (4) any actual award credited to an eligible employee in connection with Dana’s performance awards all of which vest in full as of date of termination; (5) medical insurance, prescription drug and dental insurance plans as well as basic life insurance at the same cost structure available to active employees; (6) the employee assistance program; (7) reasonable costs of outplacement services not to exceed $25,000 ($50,000 for our CEO). The period of coverage for medical insurance, prescription drug and dental insurance plans as well as basic life insurance is two years (three years for our CEO). Notwithstanding the foregoing, the coverage period will terminate earlier if the executive receives similar coverage from a subsequent employer.

 

Each executive is also entitled to receive reimbursement for all costs incurred in procuring health and dental care coverage for such employee and his or her eligible dependents under COBRA after the health benefits described above conclude.

 

Our Executive Severance Plan included a conditional excise tax gross-up provision such that if the executive incurred any excise tax by reason of his or her receipt of any payment that constituted an excess parachute payment, as defined in Section 280G of the Internal Revenue Code, the executive would be entitled to a gross-up payment only if the aggregate excess parachute payments exceeded 120% of the respective 280G limit. The amount of the gross-up payment would place the executive in the same after-tax position he or she would have been in had no excise tax applied. Under the plan, Dana is required to reduce the executive’s change in control benefits by up to 20% of the 280G limit if doing so avoids imposition of the 280G excise tax for the executive.

 

In 2009, executives who were eligible for the change in control benefit voluntarily waived the excise tax gross up provision. All named executive officers who were eligible for the benefit voluntarily waived the gross up provision with the exception of Mr. Yost whose terms of employment include this benefit. As a result, any eligible executive officers (other than Mr. Yost) would receive the better of the following change in control payments on an after-tax basis: i) change in control payment less excise tax (paid by executive), if the payment is deemed to be an excess parachute payment, and less other applicable income taxes or ii) change in

control payment reduced to an amount such that an excise tax payment is not in effect, less other applicable income taxes. If the excess parachute amount is not triggered, the change in control payment is not affected by any excise tax.

 

Regular Severance Pay.  In the event any eligible executive officer, except our CEO, is involuntarily terminated by Dana without cause and such termination occurs prior to a change in control date, Dana will pay the executive an amount based on his or her annual base salary in effect on the date of termination for a period of 12 months. Our CEO is entitled to receive an amount based on his annual base salary in effect on the date of termination for a period of 24 months. The Executive Severance Plan contains an offset provision to prevent executives with severance provisions under an employment agreement from receiving double benefits.

 

Additionally, the executive, except our CEO, for a period of 12 months beginning on the employment termination date will continue to participate in or receive reimbursement for (i) medical insurance, prescription drug and dental insurance plans as well as basic life insurance; (ii) the employee assistance program; and (iii) reasonable costs of outplacement services, subject to a maximum amount of $25,000. Our CEO will continue to participate in or receive reimbursement for (i) medical insurance, prescription drug and dental insurance plans as well as basic life insurance; (ii) the employee assistance program; and (iii) reasonable costs of outplacement services, subject to a maximum amount of $50,000 for a period of 24 months beginning on the employment termination date.

 

Severance Agreement with Nick Stanage

 

In connection with his departure, Dana entered into a separation agreement in July 2009 with Nick Stanage, our former President — Heavy Vehicle Products. Under the separation agreement, Mr. Stanage worked on such ongoing and transition matters assigned to him prior to his last day of employment on October 31, 2009. Mr. Stanage continued to receive his: (i) current base compensation; (ii) perquisite allowance; (iii) accrued unused vacation; and (iv) group health insurance through October 31, 2009. In addition, Mr. Stanage was entitled to a lump sum payment equal to 12 months of his base compensation ($425,000) with all deductions required by law. Mr. Stanage also receives 18 months of subsidized COBRA. Dana agreed to reimburse Mr. Stanage, up to $2,000, for legal services to negotiate his separation agreement. He was entitled to outplacement services at a cost of $25,000 paid directly to Mr. Stanage in cash. In addition, Mr. Stanage received a lump sum payment of $75,000 to satisfy any claims he may have or may otherwise assert. As discussed above in footnote 12 to the Summary Compensation Table, Mr. Stanage was eligible for a partial benefit of $1,047,750 under his supplemental executive retirement plan. Mr. Stanage provided a general release to Dana for any claims he might have against Dana, and he is subject to certain non-compete, confidentiality and non-disclosure obligations.

 

Retirement of Gary Convis

 

As discussed above, Mr. Convis retired as our Vice Chairman on December 31, 2009 and became a Senior Advisor to the company. Mr. Convis reached retirement age under our Omnibus Incentive Plan and as a result, the long-term incentive grants he received as an employee continue to vest according to the normal vesting schedule pursuant to his 2009 executive employment agreement. These long-term incentive grants include a total of 1,066,900 stock options (766,900 at an exercise price of $10.00 and 300,000 at an exercise price of $1.90), 50,000 performance shares and 50,000 restricted stock units valued at a total of $4,410,196 based on the closing price of our common stock on December 31, 2009. Mr. Convis also resigned from the Board of Directors of Dana effective December 31, 2009. As a result, he forfeited all unvested long-term incentive awards provided for Board service and had 30 days to exercise any vested stock options. At the time of his resignation, Mr. Convis forfeited 29,315 stock options and 3,314 restricted stock units valued at a total of $58,790 based on the closing price of our common stock on December 31, 2009. He held 3,787 vested stock options valued at $2,954 based on the closing price of our common stock on December 31, 2009.

The following tables set forth the potential payments which would have been due to our named executive officers upon termination or a change of control as of December 31, 2009.

 

John Devine

 

The following table describes potential termination and change in control payments to Mr. Devine, Dana’s Executive Chairman, under a variety of circumstances pursuant to his January 2010 Executive Employment Agreement:

 

						Change in																Voluntary				Voluntary
		Change in				Control and												Termination				Termination				Termination
		Control and				Not												Without				with Good				w/o Good
Pay Element		Terminated				Terminated				Death				Disability				Cause				Reason				Reason
Cash Compensation
Base Salary		$	1,350,000	(1)		$	0			$	0			$	0			$	1,350,000	(1)		$	1,350,000	(1)		$	0
Annual Incentive Award(2)		$	0			$	0			$	0			$	0			$	0			$	0			$	0
Long term Incentive
Stock Options		$	8,940,000	(3)		$	8,940,000	(3)		$	8,940,000	(3)		$	8,940,000	(3)		$	8,940,000	(4)		$	8,940,000	(4)		$	8,940,000	(4)
Restricted Stock Units		$	1,806,670	(5)		$	1,806,670	(5)		$	1,806,670	(5)		$	1,806,670	(5)		$	1,806,670	(6)		$	1,806,670	(6)		$	1,806,670	(6)
Performance Shares		$	1,806,670	(7)		$	1,806,670	(7)		$	1,806,670	(7)		$	1,806,670	(7)		$	1,806,670	(8)		$	1,806,670	(8)		$	1,806,670	(8)
Benefits and Perquisites
Health Insurance(9)		$	0			$	0			$	0			$	0			$	0			$	0			$	0
Life Insurance Benefits										$	1,350,000	(10)
Accrued Vacation(11)		$	112,500			$	0			$	112,500			$	112,500			$	112,500			$	112,500			$	112,500
Other
Outplacement		$	0			$	0			$	0			$	0			$	50,000	(12)		$	0			$	0
Total		$	14,015,840			$	12,553,340			$	14,015,840			$	12,665,840			$	14,065,840			$	14,015,840			$	12,665,840

 

Footnotes:

 

 

 

James Sweetnam

 

The following table describes potential termination and change in control payments to Mr. Sweetnam, Dana’s President and Chief Executive Officer, under a variety of circumstances pursuant to his July 2009 Executive Employment Agreement:

 

						Change in																Voluntary				Voluntary
		Change in				Control and												Termination				Termination				Termination
		Control and				Not												without				with Good				w/o Good
Pay Element		Terminated(1)				Terminated				Death				Disability				Cause				Reason				Reason
Cash Compensation
Base Salary		$	0			$	0			$	0			$	0			$	2,000,000	(8)		$	2,000,000	(8)		$	0
Sign-on Bonus		$	1,000,000															$	1,000,000			$	1,000,000
Annual Incentive Award(2)		$	0			$	0			$	0			$	0			$	0			$	0			$	0
Separation Payment		$	5,840,000	(3)
Long term Incentive
Stock Options		$	14,205,000	(4)		$	14,205,000	(4)		$	14,205,000	(4)		$	14,205,000	(4)		$	14,205,000	(4)		$	14,205,000	(4)		$	0	(9)
Restricted Stock Units		$	2,168,000	(5)		$	2,168,000	(5)		$	650,400	(6)		$	650,400	(6)		$	2,168,000	(5)		$	2,168,000	(5)		$	0	(9)
Benefits and Perquisites
Health Insurance		$	41,981	(10)		$	0			$	0			$	0			$	27,987	(11)		$	27,987	(11)		$	0
Life Insurance Benefits										$	1,000,000	(12)
Continuation of Life Insurance Benefits(16)		$	6,408			$	0			$	0			$	0			$	4,272			$	4,272			$	0
Supplemental Benefit		$	733,333	(14)		$	0			$	183,333	(15)		$	183,333	(15)		$	733,333	(14)		$	733,333	(14)		$	0
Accrued Vacation(7)		$	83,333			$	0			$	83,333			$	83,333			$	83,333			$	83,333			$	83,333
Other
Outplacement		$	50,000			$	0			$	0			$	0			$	50,000	(13)		$	50,000	(13)		$	0
Total		$	24,128,055			$	16,373,000			$	16,122,066			$	15,122,066			$	20,271,925			$	20,271,925			$	83,333