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<SEC-DOCUMENT>0000950127-07-000460.txt : 20070726
<SEC-HEADER>0000950127-07-000460.hdr.sgml : 20070726
<ACCEPTANCE-DATETIME>20070726131257
ACCESSION NUMBER:		0000950127-07-000460
CONFORMED SUBMISSION TYPE:	SC 13D/A
PUBLIC DOCUMENT COUNT:		2
FILED AS OF DATE:		20070726
DATE AS OF CHANGE:		20070726

SUBJECT COMPANY:	

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			DANA CORP
		CENTRAL INDEX KEY:			0000026780
		STANDARD INDUSTRIAL CLASSIFICATION:	MOTOR VEHICLE PARTS & ACCESSORIES [3714]
		IRS NUMBER:				344361040
		STATE OF INCORPORATION:			VA
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		SC 13D/A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	005-10058
		FILM NUMBER:		071001782

	BUSINESS ADDRESS:	
		STREET 1:		4500 DORR ST
		CITY:			TOLEDO
		STATE:			OH
		ZIP:			43615
		BUSINESS PHONE:		4195354500

	MAIL ADDRESS:	
		STREET 1:		PO BOX 1000
		CITY:			TOLEDO
		STATE:			OH
		ZIP:			43697

FILED BY:		

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			APPALOOSA MANAGEMENT LP
		CENTRAL INDEX KEY:			0001006438
		IRS NUMBER:				223220835
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		SC 13D/A

	BUSINESS ADDRESS:	
		STREET 1:		26 MAIN ST
		STREET 2:		1ST FLOOR
		CITY:			CHATHAM
		STATE:			NJ
		ZIP:			07928
		BUSINESS PHONE:		9737017000

	MAIL ADDRESS:	
		STREET 1:		26 MAIN ST
		STREET 2:		1ST FLOOR
		CITY:			CHATAM
		STATE:			NJ
		ZIP:			07928
</SEC-HEADER>
<DOCUMENT>
<TYPE>SC 13D/A
<SEQUENCE>1
<FILENAME>sc13da.txt
<DESCRIPTION>AMENDMENT NO. 4 TO SCHEDULE 13D
<TEXT>
================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   ----------

                                 SCHEDULE 13D/A
                                (Amendment No. 4)
                    Under the Securities Exchange Act of 1934

                                   ----------

                                DANA CORPORATION
                                (Name of Issuer)

                     Common Stock, $1.00 Par Value Per Share
                         (Title of Class of Securities)

                                    235811106
                                 (CUSIP Number)
                                 with copies to:
                                 --------------
                                   Ken Maiman
                            Appaloosa Management L.P.
                                 26 Main Street
                                Chatham, NJ 07928
                  (Name, Address and Telephone Number of Person
                 Authorized to Receive Notices of Communication)

                                  July 25, 2007
             (Date of Event Which Requires Filing of This Statement)

     If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box. [ ]

================================================================================
                                   Page 1 of 9
<PAGE>
- -------------------                                          -------------------
CUSIP No. 235811106                 13D
- -------------------                                          -------------------
- ------ -------------------------------------------------------------------------
  1    NAME OF REPORTING PERSONS
       Appaloosa Investment Limited Partnership I

       S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
- ------ -------------------------------------------------------------------------
  2    CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP                  (a) [ ]
                                                                         (b) [ ]
- ------ -------------------------------------------------------------------------
  3    SEC USE ONLY
- ------ -------------------------------------------------------------------------
  4    SOURCE OF FUNDS
       OO
- ------ -------------------------------------------------------------------------
  5    CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
       TO ITEM 2(d) or 2(e)                                                  [ ]
- ------ -------------------------------------------------------------------------
  6    CITIZENSHIP OR PLACE OF ORGANIZATION
       Delaware
- ------------------------ ------ ------------------------------------------------
NUMBER OF SHARES         7      SOLE VOTING POWER
BENEFICIALLY OWNED              0
BY EACH REPORTING        ------ ------------------------------------------------
PERSON WITH              8      SHARED VOTING POWER
                                11,992,500
                         ------ ------------------------------------------------
                         9      SOLE DISPOSITIVE POWER
                                0
                         ------ ------------------------------------------------
                         10     SHARED DISPOSITIVE POWER
                                11,992,500
- ------ -------------------------------------------------------------------------
  11   AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
       11,992,500
- ------ -------------------------------------------------------------------------
  12   CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
       CERTAIN SHARES                                                        [ ]
- ------ -------------------------------------------------------------------------
  13   PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
       7.98%
- ------ -------------------------------------------------------------------------
  14   TYPE OF REPORTING PERSON
       PN
- ------ -------------------------------------------------------------------------

                                   Page 2 of 9
<PAGE>
- -------------------                                          -------------------
CUSIP No. 235811106                 13D
- -------------------                                          -------------------

- ------ -------------------------------------------------------------------------
   1   NAME OF REPORTING PERSONS
       Palomino Fund Ltd.

       S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
- ------ -------------------------------------------------------------------------
   2   CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP                  (a) [ ]
                                                                         (b) [ ]
- ------ -------------------------------------------------------------------------
   3   SEC USE ONLY
- ------ -------------------------------------------------------------------------
   4   SOURCE OF FUNDS
       OO
- ------ -------------------------------------------------------------------------
   5   CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
       TO ITEM 2(d) or 2(e)                                                  [ ]
- ------ -------------------------------------------------------------------------
   6   CITIZENSHIP OR PLACE OF ORGANIZATION
       British Virgin Islands
- ------------------------ ------ ------------------------------------------------
NUMBER OF SHARES         7      SOLE VOTING POWER
BENEFICIALLY OWNED              0
BY EACH REPORTING        ------ ------------------------------------------------
PERSON WITH              8      SHARED VOTING POWER
                                10,507,500
                         ------ ------------------------------------------------
                         9      SOLE DISPOSITIVE POWER
                                0
                         ------ ------------------------------------------------
                         10     SHARED DISPOSITIVE POWER
                                10,507,500
- ------ -------------------------------------------------------------------------
  11   AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
       10,507,500
- ------ -------------------------------------------------------------------------
  12   CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
       CERTAIN SHARES                                                        [ ]
- ------ -------------------------------------------------------------------------
  13   PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
       7.00%
- ------ -------------------------------------------------------------------------
  14   TYPE OF REPORTING PERSON
       CO
- ------ -------------------------------------------------------------------------
                                   Page 3 of 9
<PAGE>
- -------------------                                          -------------------
CUSIP No. 235811106                 13D
- -------------------                                          -------------------
- ------ -------------------------------------------------------------------------
   1   NAME OF REPORTING PERSONS
       Appaloosa Management L.P.

       S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
- ------ -------------------------------------------------------------------------
   2   CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP                  (a) [ ]
                                                                         (b) [ ]
- ------ -------------------------------------------------------------------------
   3   SEC USE ONLY
- ------ -------------------------------------------------------------------------
   4   SOURCE OF FUNDS
       AF
- ------ -------------------------------------------------------------------------
   5   CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
       TO ITEM 2(d) or 2(e)                                                  [ ]
- ------ -------------------------------------------------------------------------
   6   CITIZENSHIP OR PLACE OF ORGANIZATION
       Delaware
- ------------------------ ------ ------------------------------------------------
NUMBER OF SHARES         7      SOLE VOTING POWER
BENEFICIALLY OWNED              0
BY EACH REPORTING        ------ ------------------------------------------------
PERSON WITH              8      SHARED VOTING POWER
                                22,500,000
                         ------ ------------------------------------------------
                         9      SOLE DISPOSITIVE POWER
                                0
                         ------ ------------------------------------------------
                         10     SHARED DISPOSITIVE POWER
                                22,500,000
- ------ -------------------------------------------------------------------------
  11   AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
       22,500,000
- ------ -------------------------------------------------------------------------
  12   CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
       CERTAIN SHARES                                                        [ ]
- ------ -------------------------------------------------------------------------
  13   PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
       14.98%
- ------ -------------------------------------------------------------------------
  14   TYPE OF REPORTING PERSON
       PN
- ------ -------------------------------------------------------------------------

                                   Page 4 of 9
<PAGE>
- -------------------                                          -------------------
CUSIP No. 235811106                 13D
- -------------------                                          -------------------
- ------ -------------------------------------------------------------------------
   1   NAME OF REPORTING PERSONS
       Appaloosa Partners Inc.

       S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
- ------ -------------------------------------------------------------------------
   2   CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP                  (a) [ ]
                                                                         (b) [ ]
- ------ -------------------------------------------------------------------------
   3   SEC USE ONLY
- ------ -------------------------------------------------------------------------
   4   SOURCE OF FUNDS
       AF
- ------ -------------------------------------------------------------------------
   5   CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
       TO ITEM 2(d) or 2(e)                                                  [ ]
- ------ -------------------------------------------------------------------------
   6   CITIZENSHIP OR PLACE OF ORGANIZATION
       Delaware
- ------------------------ ------ ------------------------------------------------
NUMBER OF SHARES         7      SOLE VOTING POWER
BENEFICIALLY OWNED              0
BY EACH REPORTING        ------ ------------------------------------------------
PERSON WITH              8      SHARED VOTING POWER
                                22,500,000
                         ------ ------------------------------------------------
                         9      SOLE DISPOSITIVE POWER
                                0
                         ------ ------------------------------------------------
                         10     SHARED DISPOSITIVE POWER
                                22,500,000
- ------ -------------------------------------------------------------------------
  11   AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
       22,500,000
- ------ -------------------------------------------------------------------------
  12   CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
       CERTAIN SHARES                                                        [ ]
- ------ -------------------------------------------------------------------------
  13   PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
       14.98%
- ------ -------------------------------------------------------------------------
  14   TYPE OF REPORTING PERSON
       CO
- ------ -------------------------------------------------------------------------

                                   Page 5 of 9
<PAGE>
- -------------------                                          -------------------
CUSIP No. 235811106                 13D
- -------------------                                          -------------------

- ------ -------------------------------------------------------------------------
   1   NAME OF REPORTING PERSONS
       David A. Tepper

       S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
- ------ -------------------------------------------------------------------------
   2   CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP                  (a) [ ]
                                                                         (b) [ ]
- ------ -------------------------------------------------------------------------
   3   SEC USE ONLY
- ------ -------------------------------------------------------------------------
   4   SOURCE OF FUNDS
       AF
- ------ -------------------------------------------------------------------------
   5   CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
       TO ITEM 2(d) or 2(e)                                                  [ ]
- ------ -------------------------------------------------------------------------
   6   CITIZENSHIP OR PLACE OF ORGANIZATION
       United States of America
- ------------------------ ------ ------------------------------------------------
NUMBER OF SHARES         7      SOLE VOTING POWER
BENEFICIALLY OWNED              0
BY EACH REPORTING        ------ ------------------------------------------------
PERSON WITH              8      SHARED VOTING POWER
                                22,500,000
                         ------ ------------------------------------------------
                         9      SOLE DISPOSITIVE POWER
                                0
                         ------ ------------------------------------------------
                         10     SHARED DISPOSITIVE POWER
                                22,500,000
- ------ -------------------------------------------------------------------------
  11   AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
       22,500,000
- ------ -------------------------------------------------------------------------
  12   CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
       CERTAIN SHARES                                                        [ ]
- ------ -------------------------------------------------------------------------
  13   PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
       14.98%
- ------ -------------------------------------------------------------------------
  14   TYPE OF REPORTING PERSON
       IN
- ------ -------------------------------------------------------------------------

                                   Page 6 of 9
<PAGE>
     This Amendment No. 4 (this "Amendment") to the Schedule 13D filed on June
22, 2007 by the Reporting Persons, as amended by Amendment No. 1 thereto filed
on June 29, 2007, by Amendment No. 2 thereto filed on July 19, 2007 and by
Amendment No. 3 thereto filed on July 23, 2007 (as so amended, the "Schedule
13D") relates to the Common Stock of the Issuer and is being filed to amend the
Schedule 13D as specifically set forth below.

     The information set forth in the Exhibits to this Amendment is hereby
expressly incorporated herein by reference, and the responses to each item of
this Amendment are qualified in their entirety by the provisions of such
Exhibits. Unless otherwise indicated, all capitalized terms shall have the
meanings ascribed to them in the Schedule 13D, and unless otherwise amended
hereby, all information previously filed remains in effect.

ITEM 4. IS AMENDED BY ADDING THE FOLLOWING:

     On July 25, 2007, AMLP sent a letter to the Board again requesting that the
Board reconsider its pursuit of the proposed transaction with Centerbridge
Capital Partners, L.P. ("Centerbridge"), which is described in the Issuer's
current report on Form 8-K filed on July 5, 2007 (the "Proposed Centerbridge
Transaction"), as modified by the terms described in the Issuer's Omnibus Reply
to Objections to the Issuer's motion before the bankruptcy court, seeking
approval of, among other things, the terms under which Centerbridge is willing
to invest in a plan of reorganization of the Company (the "Modified Centerbridge
Investment Terms").

     In the July 25 letter, AMLP (i) stated its belief that a plan of
reorganization based upon the Modified Centerbridge Investment Terms, which was
submitted by Centerbridge largely as a counter to the enhancements proposed and
committed to by AMLP, still falls short of providing a construct for a
reorganization that is in the best interests of all stakeholders, and (ii)
committed to make several improvements to the Modified Centerbridge Investment
Terms. The foregoing summary of AMLP's July 25th letter to the Board is
qualified in its entirety by reference to the July 25th letter, a copy of which
is filed with this Amendment No. 4 as Exhibit 5 to the Schedule 13D.

     While the Reporting Persons do not have any current plans or proposals,
except as otherwise described in the Schedule 13D, which relate to or would
result in any transaction, event or action enumerated in paragraphs (a) through
(j) of Item 4 of the form of Schedule 13D promulgated under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), each of the Reporting
Persons reserves the right, in light of its or his ongoing evaluation of the
Issuer's financial condition, business, operations and prospects, the market
price of the Common Stock, conditions in the securities markets generally,
general economic and industry conditions, its or his business objectives and
other relevant factors, to change its or his plans and intentions at any time,
as it or he deems appropriate. In particular, and without limiting the
generality of the foregoing, but subject to the terms of applicable court
orders, restrictions and agreements and to any limitations imposed by applicable
law, including the Exchange Act, each of the Reporting Persons (and their
respective affiliates) may (i) purchase additional shares of Common Stock or
other securities of or claims against the Issuer, (ii) sell or transfer shares
of Common Stock or other securities or claims beneficially owned by it or him
from time to time in public or private

                                   Page 7 of 9
<PAGE>
transactions and (iii) cause any of the Reporting Persons to distribute in kind
to their respective stockholders, partners or members, as the case may be,
shares of Common Stock or other securities or claims owned by such Reporting
Persons. The Reporting Persons may seek the views of, hold discussions with, or
respond to inquiries from members of the Issuer's management or Board of
Directors or other persons including other stockholders, or holders of claims in
the Issuer's bankruptcy proceedings, regarding the Issuer's affairs,
restructuring or other strategic matters.

ITEM 7.  MATERIAL TO BE FILED AS EXHIBITS

     Item 7 of the Schedule 13D is supplemented as follows:

EXHIBIT NO.    DESCRIPTION
- -----------    -----------------------------------------------------------------
   5           Letter from Appaloosa Management L.P. to the Board of Directors
               of Dana Corporation, dated July 25, 2007.

                                   Page 8 of 9
<PAGE>
                                    SIGNATURE

     After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.

Dated: July 26, 2007


                                                APPALOOSA INVESTMENT LIMITED
                                                PARTNERSHIP I

                                                By: APPALOOSA MANAGEMENT L.P.,
                                                    Its General Partner

                                                By: APPALOOSA PARTNERS INC.,
                                                    Its General Partner


                                                By: /s/ David A. Tepper
                                                    ----------------------------
                                                Name:  David A. Tepper
                                                Title: President

                                                PALOMINO FUND LTD.

                                                By: APPALOOSA MANAGEMENT L.P.,
                                                    Its Investment Adviser

                                                By: APPALOOSA PARTNERS INC.,
                                                    Its General Partner


                                                By: /s/ David A. Tepper
                                                    ----------------------------
                                                Name:  David A. Tepper
                                                Title: President

                                                APPALOOSA MANAGEMENT L.P.

                                                By: APPALOOSA PARTNERS INC.,
                                                    Its General Partner


                                                By: /s/ David A. Tepper
                                                    ----------------------------
                                                Name:  David A. Tepper
                                                Title: President

                                                APPALOOSA PARTNERS INC.


                                                By: /s/ David A. Tepper
                                                    ----------------------------
                                                Name:  David A. Tepper
                                                Title: President


                                                /s/ David A. Tepper
                                                --------------------------------
                                                David A. Tepper

                                   Page 9 of 9
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>2
<FILENAME>ex99.txt
<DESCRIPTION>LETTER TO BOARD OF DIRECTORS
<TEXT>
                            Appaloosa Management L.P.
                                 26 Main Street
                                Chatham, NJ 07928

July 25, 2007

TO: THE BOARD OF DIRECTORS OF DANA CORPORATION
4500 Dorr Street
Toledo, Ohio 43615

Ladies and Gentlemen:

Earlier today, the Company filed with the Bankruptcy Court its Omnibus Reply to
Objections to its Motion seeking approval of, among other things, the terms
under which Centerbridge Capital Partners, L.P. is willing to invest in a plan
of reorganization of the Company. In its Reply, the Company sets forth certain
modifications to Centerbridge's originally publicized investment terms (the
"Modified Centerbridge Investment Terms").

We believe that the Modified Centerbridge Investment Terms continue to fall
short of providing a fair and adequate recovery to stakeholders. We believe that
such deficiencies are the product of, among other things, a flawed market test
being performed by the Company, which lacks sufficient openness and
transparency, and that unfair and inadequate recoveries will be the inevitable
conclusions of the Company's reorganization efforts. In this regard, it is
obvious that the Modified Centerbridge Investment Terms have been submitted
largely as a counter to our enhancements over Centerbridge's original proposal
that we previously committed to you. We believe the conclusion that stakeholders
would benefit substantially from an open and transparent marketing process
(which is currently lacking) cannot be reasonably disputed.

Furthermore, we are in receipt of your letter to us, dated July 18, 2007,
refusing to take any actions with respect to Dana's "poison pill." We believe
such refusal to modify the poison pill as we previously requested in our letter
to you, dated June 28, 2007, has a further chilling effect on the ability of
stakeholders to formulate competitive alternative proposals for a plan of
reorganization with market terms. We hereby reiterate our request, again without
conceding that the poison pill was, in fact, properly extended without
Bankruptcy Court approval, that you modify Dana's rights plan as set forth in
our June 28, 2007 letter, a copy of which is attached hereto.

In light of our conclusion that a plan of reorganization based upon the Modified
Centerbridge Investment Terms falls far short of providing a construct for a
reorganization that is in the best interest of all stakeholders, we are prepared
to further demonstrate the relative ease upon which we are able to offer
enhancements to such proposal. Accordingly, in addition to the July 18th
Enhancements, Appaloosa now commits and agrees to make the following additional
changes to the Modified Centerbridge Investment Terms:

     (1)  Appaloosa adopts and agrees to each of the Modified Centerbridge
Investment Terms (all as set forth on Schedule 1 annexed hereto), except (a) for
the collar mechanism set
<PAGE>
forth therein (unless and until Appaloosa receives a satisfactory explanation of
how the mechanism operates), and (b) to the extent otherwise inconsistent with
the terms set forth herein.

     (2)  In lieu of the limited Rule 144A Offering contemplated by the Modified
Centerbridge Investment Terms, which Appaloosa contends is discriminatory in its
treatment of stakeholders, the right to purchase the Series B Preferred at par
will be offered to all holders of allowed unsecured claims on a pro rata basis
(the "Series B Rights Offering"). Any shares of Series B Preferred not purchased
under the Series B Preferred Rights Offering will be purchased at par by
Appaloosa and certain other entities (the "Standby Purchasers") who shall
receive a guaranteed minimum of 10% of the Series B Preferred and a commitment
fee of $10.0 million (2.0%) as consideration for their agreement to perform the
foregoing standby purchaser obligations.

     (3)  The Approval Rights (as defined in the Centerbridge Investment Terms)
shall be subject to being over-ridden by a 2/3s vote of the common shareholders
(not counting any shares held by Appaloosa). A special shareholder meeting may
be called upon the giving of notice by 20% or more of the issued and outstanding
shares of common stock.

     (4)  The initial Board of Directors shall be selected as follows:

          (A)  Appaloosa shall select 3 directors;

          (B)  The UCC shall select 3 directors;

          (C)  One director shall be the CEO;

          (D)  One director shall be the new Executive Chairman (selected as
     described below); and

          (E)  One director shall be selected by the Standby Purchasers other
     than Appaloosa.

     (5)  Not less than 2/3s of the New Board shall be "independent" as defined
under the NYSE rules and shall also be independent from Appaloosa.

     (6)  The initial Executive Chairman of the Board shall be selected by a
selection committee comprised of one Appaloosa representative, one UCC
representative and one representative of the Standby Purchasers (other than
Appaloosa). The Executive Chairman shall be approved by a majority vote of the
Selection Committee (such majority to include the Appaloosa representative). Any
successor Executive Chairman shall be selected by the Nominating and Governance
Committee of the Board, subject (but only for so long as Appaloosa retains the
voting rights set forth in paragraph (8) below) to the approval of Appaloosa.

                                       2
<PAGE>
     (7)  The Executive Chairman shall be a full-time employee of the Company
with his or her principal office in the Company's world headquarters in Toledo,
Ohio and shall devote substantially all of his or her business activity to the
business affairs of the Company.

          The Executive Chairman shall cause the Company to and the Company
shall be obligated to meaningfully consult with the representatives of Appaloosa
with respect to the annual budget and material modifications thereto prior to
the time it is submitted to the Board for approval.

          The employment agreements entered into by the Company with the
Executive Chairman and the Chief Executive Officer shall provide that (i) upon
any termination of employment, the Executive Chairman and/or the Chief Executive
Officer shall resign as a director (and the employment agreements shall require
delivery at the time such agreements are entered into of an executed irrevocable
resignation that becomes effective upon such termination) and (ii) the right to
receive any payments or other benefits upon termination of employment shall be
conditioned upon such resignation. If for any reason the Executive Chairman or
the Chief Executive Officer does not resign or the irrevocable resignation is
determined to be ineffective, then the Series A Preferred Stock Holders may
remove the Executive Chairman and/or Chief Executive Officer as a director,
subject to applicable law.

     (8)  For so long as Appaloosa shall beneficially own not less than $150
million of the Series A Preferred or until the fourth anniversary of the
Effective Date, whichever comes first, the Series A Preferred shall vote
separately as a class to elect the Series A Preferred directors and shall have
the right to remove and replace the Series A Directors; thereafter, the Series A
Preferred shall vote together with the common on an as converted basis.

Notwithstanding our full commitment to pursue an alternative to the Modified
Centerbridge Investment Terms as outlined above, we continue to believe that
such transaction, even as improved by us, remains fundamentally unfair to
existing stakeholders. Accordingly, we remain prepared to continue to explore
with the Company a transaction bases upon the "Term Sheet for Plan of
Reorganization for Dana Corporation" attached to our July 18th Letter.

                                       3
<PAGE>
We continue to believe that the situation requires your immediate attention and
consideration and await your response. We are available to meet with the Board
and its representatives at your earliest convenience to discuss more fully the
matters set forth herein and to work toward an amicable, appropriate conclusion
to Dana's chapter 11 case.

Sincerely,

APPALOOSA MANAGEMENT L.P.


- ------------------------
David Tepper
President

                                       4
<PAGE>
                                   SCHEDULE 1

o    Appendix R to the Union Settlement Agreement now: (i) provides that the
     counsel for the Creditors' Committee will be co-counsel with the Debtors in
     any mediation/arbitration proceeding; (ii) establishes an objective
     standard by which the mediator/arbitrator is to determine whether the
     Unions acted reasonably in withholding their consent to an alternative
     transaction; (iii) identifies an arbitrator that is acceptable to the
     Debtors, the Unions and the Creditors' Committee; and (iv) limits the
     Union's due diligence and the arbitration period to four weeks in the
     aggregate;

o    There will be $250 million (rather than $300 million) of Series A Preferred
     Shares and $500 million (rather than $450 million) of Series B Preferred
     Shares;

o    The $500 million of Series B Preferred will be offered to qualified
     investors (holders of at least $25 million in the aggregate of claims and
     who are "qualified institutional buyers" as defined in Rule 144A
     promulgated under the Securities Act as of (i) for bonds, 10 days after the
     date that this Motion is approved and (ii) for trade creditors, at later
     dates);

o    The Debtors are committed to address the concerns raised by the Creditors'
     Committee on behalf of creditors who are not qualified investors in the
     plan of reorganization;

o    The Series A Preferred is pari passu to the Series B Preferred;

o    The lock-up period for all of the Series B Preferred and that portion of
     the Series A Preferred not subject to the three-year lock-up period
     increases from 2 months to 6 months;

o    The market pricing for the Preferred Stock remains the market pricing set
     forth in the Motion subject to a collar based on a total enterprise value
     range between $3,150,000,000 and $3,500,000,000;

o    The commitment fee payable to Centerbridge on the Series B-1 Preferred
     Stock would be reduced from 1.75% to 1% (but would remain 1.75% if the
     Debtors pursue a transaction other than an alternative minority
     investment);

o    The consent rights of Centerbridge are non-transferable and are limited to
     three years (12 months for dividends and the issuance of senior or pari
     passu securities) or up until it holds less than 50% of the
     then-outstanding Series A Preferred, whichever comes first;

o    The Unions will receive $60 million in cash to their VEBAs in lieu of the
     $80 million stock contribution;

o    The Debtors agree not to oppose, and Centerbridge and the Unions will
     support, an application of counsel to the Ad Hoc Committee under section
     503(b) of the Bankruptcy Code for reasonable fees up to a cap of $5
     million;

                                       5
<PAGE>
o    Any plan of reorganization will be proposed to take advantage of the tax
     benefits available under Internal Revenue Code Section 382(l)(6) rather
     than Section 382(l)(5);

o    Miller Buckfire's fees shall be determined in an amount reasonably
     satisfactory to Miller Buckfire, the Ad Hoc Committee of Bondholders and
     the Creditors' Committee; and

o    Any order approving the Motion shall provide for a process and schedule
     that are acceptable to the Debtors and the Creditors' Committee for
     interested parties to submit competing offers.

                                       6
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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