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Note 11 - Financing Agreements | 6 Months Ended
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Jun. 30, 2024
Notes to Financial Statements |
Debt Disclosure [Text Block] | Note 11. Financing Agreements Long-term debt at —
| Interest Rate |  |  | June 30, 2024 |  |  | December 31, 2023 |
Senior Notes due April 15, 2025 | 5.750% | * |  | $ | 200 |  |  | $ | 200 |
Senior Notes due November 15, 2027 | 5.375% |  |  |  | 400 |  |  |  | 400 |
Senior Notes due June 15, 2028 | 5.625% |  |  |  | 400 |  |  |  | 400 |
Senior Euro Notes due July 15, 2029 | 3.000% |  |  |  | 348 |  |  |  | 359 |
Senior Notes due September 1, 2030 | 4.250% |  |  |  | 400 |  |  |  | 400 |
Senior Euro Notes due July 15, 2031 | 8.500% |  |  |  | 455 |  |  |  | 469 |
Senior Notes due February 15, 2032 | 4.500% |  |  |  | 350 |  |  |  | 350 |
Other indebtedness |  |  |  |  | 66 |  |  |  | 79 |
Debt issuance costs |  |  |  |  | (22 | ) |  |  | (24 | )
|  |  |  |  | 2,597 |  |  |  | 2,633 |
Less: Current portion of long-term debt |  |  |  |  | 211 |  |  |  | 35 |
Long-term debt, less debt issuance costs |  |  |  | $ | 2,386 |  |  | $ | 2,598 |
* | In conjunction with the issuance of the April 2025 Notes, we entered into 8-year fixed-to-fixed cross-currency swaps which have the effect of economically converting the April 2025 Notes to euro-denominated debt at a fixed rate of 3.850%. See Note 12 for additional information.
Interest on the senior notes is payable semi-annually. Other indebtedness includes borrowings from various financial institutions and finance lease obligations. Senior notes activity — On May 24, 2023, Dana Financing Luxembourg S.à.r.l. (Dana Financing), a wholly-owned subsidiary of Dana, completed the sale of €425 ($458 as of May 24, 2023) in senior unsecured notes ( July 2031 Notes) at 8.500%. The July 2031 Notes are fully and unconditionally guaranteed by Dana. The July 2031 Notes were issued through a private placement and will not be registered under the U.S. Securities Act of 1933, as amended (the Securities Act). The July 2031 Notes were offered only to qualified institutional buyers in reliance on Rule 144A under the Securities Act and, outside the United States, only to non-U.S. investors in reliance on Regulation S under the Securities Act. The July 2031 Notes rank equally with Dana's other unsecured senior notes. Interest on the notes is payable on January 15 and July 15 of each year, beginning on January 15, 2024. The July 2031 Notes will mature on July 15, 2031. Net proceeds of the offering totaled €419 ($451 as of May 24, 2023). Financing costs of €6 ($7 as of May 24, 2023) were recorded as deferred costs and are being amortized to interest expense over the life of the notes. The proceeds from the offering were used to redeem $200 of our April 2025 Notes and to make payments against borrowings on our Revolving Facility. On June 9, 2023 we redeemed $200 of our April 2025 Notes at a price equal to 100.00% plus accrued and unpaid interest. The $1 loss on extinguishment of debt is comprised of the write-off of previously deferred financing costs associated with the April 2025 Notes. Senior notes redemption provisions — We may redeem some or all of the senior notes at the following redemption prices (expressed as percentages of principal amount), plus accrued and unpaid interest to the redemption date, if redeemed during the 12-month period commencing on the anniversary date of the senior notes in the year set forth below:
|  | Redemption Price |
|  | April |  |  | November |  |  | June |  |  | July |  |  | September |  |  | July |  |  | February |
Year |  | 2025 Notes |  |  | 2027 Notes |  |  | 2028 Notes |  |  | 2029 Notes |  |  | 2030 Notes |  |  | 2031 Notes |  |  | 2032 Notes |
2023 |  |  |  |  |  |  | 101.344 | % |  |  | 102.813 | % |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
2024 |  |  | 100.000 | % |  |  | 100.000 | % |  |  | 101.406 | % |  |  | 101.500 | % |  |  |  |  |  |  |  |  |  |  |  |
2025 |  |  |  |  |  |  | 100.000 | % |  |  | 100.000 | % |  |  | 100.750 | % |  |  |  |  |  |  |  |  |  |  |  |
2026 |  |  |  |  |  |  | 100.000 | % |  |  | 100.000 | % |  |  | 100.000 | % |  |  | 102.125 | % |  |  | 104.250 | % |  |  |  |
2027 |  |  |  |  |  |  |  |  |  |  | 100.000 | % |  |  | 100.000 | % |  |  | 101.417 | % |  |  | 102.125 | % |  |  | 102.250 | %
2028 |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 100.000 | % |  |  | 100.708 | % |  |  | 100.000 | % |  |  | 101.500 | %
2029 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 100.000 | % |  |  | 100.000 | % |  |  | 100.750 | %
2030 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 100.000 | % |  |  | 100.000 | %
2031 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 100.000 | %
At any time prior to July 15, 2024, we may redeem up to 40% of the aggregate principal amount of the July 2029 Notes in an amount not to exceed the amount of proceeds of one or more equity offerings, at a price equal to 103.000% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, provided that at least 50% of the aggregate principal amount of the July 2029 Notes remain outstanding after the redemption. Prior to July 15, 2024, we may also redeem some or all of the July 2029 Notes at a redemption price equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date plus a “make-whole” premium. We have not separated the make-whole premium from the underlying debt instrument to account for it as a derivative instrument as the economic characteristics and the risks of this embedded derivative are clearly and closely related to the economic characteristics and risks of the underlying debt. Prior to May 1, 2026, we may redeem some or all of the September 2030 Notes at a redemption price equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date plus a “make-whole” premium. We have not separated the make-whole premium from the underlying debt instrument to account for it as a derivative instrument as the economic characteristics and the risks of this embedded derivative are clearly and closely related to the economic characteristics and risks of the underlying debt. At any time prior to July 15, 2026, we may redeem up to 40% of the aggregate principal amount of the July 2031 Notes in an amount not to exceed the amount of proceeds of one or more equity offerings, at a price equal to 108.500% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, provided that at least 50% of the aggregate principal amount of the July 2031 Notes remain outstanding after the redemption. Prior to July 15, 2026, we may also redeem some or all of the July 2031 Notes at a redemption price equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date plus a “make-whole” premium. We have not separated the make-whole premium from the underlying debt instrument to account for it as a derivative instrument as the economic characteristics and the risks of this embedded derivative are clearly and closely related to the economic characteristics and risks of the underlying debt. At any time prior to February 15, 2025, we may redeem up to 40% of the aggregate principal amount of the February 2032 Notes in an amount not to exceed the amount of proceeds of one or more equity offerings, at a price equal to 104.500% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, provided that at least 50% of the aggregate principal amount of the February 2032 Notes remains outstanding after the redemption. Prior to February 15, 2027, we may redeem some or all of the February 2032 Notes at a redemption price equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date plus a “make-whole” premium. We have not separated the make-whole premium from the underlying debt instrument to account for it as a derivative instrument as the economic characteristics and the risks of this embedded derivative are clearly and closely related to the economic characteristics and risks of the underlying debt. Credit agreement — On March 14, 2023, we amended our credit and guaranty agreement, extending its maturity to March 14, 2028. We recorded deferred fees of $2 related to the amendment. The deferred fees are being amortized over the life of the Revolving Facility. Deferred financing costs on our Revolving Facility are included in other noncurrent assets. The Revolving Facility is guaranteed by all of our wholly-owned domestic subsidiaries subject to certain exceptions (the guarantors) and are secured by a first-priority lien on substantially all of the assets of Dana and the guarantors, subject to certain exceptions. Advances under the Revolving Facility bear interest at a floating rate based on, at our option, the base rate or the Term Secured Overnight Financing Rate ("SOFR") (each as described in the credit agreement) plus a margin as set forth below:
|  | Margin |
Total Net Leverage Ratio |  | Base Rate |  |  | SOFR Rate |
Less than or equal to 1.00:1.00 |  |  | 0.25 | % |  |  | 1.25 | %
Greater than 1.00:1.00 but less than or equal to 2.00:1.00 |  |  | 0.50 | % |  |  | 1.50 | %
Greater than 2.00:1.00 |  |  | 0.75 | % |  |  | 1.75 | %
Commitment fees are applied based on the average daily unused portion of the available amounts under the Revolving Facility as set forth below:
Total Net Leverage Ratio |  | Commitment Fee |
Less than or equal to 1.00:1.00 |  |  | 0.250 | %
Greater than 1.00:1.00 but less than or equal to 2.00:1.00 |  |  | 0.375 | %
Greater than 2.00:1.00 |  |  | 0.500 | %
Up to $275 of the Revolving Facility may be applied to letters of credit, which reduces availability. We pay a fee for issued and undrawn letters of credit in an amount per annum equal to the applicable margin for SOFR rate advances based on a quarterly average availability under issued and undrawn letters of credit under the Revolving Facility and a per annum fronting fee of 0.125%, payable quarterly. At June 30, 2024, we had no outstanding borrowings under the Revolving Facility and had utilized $9 for letters of credit. We had availability at June 30, 2024 under the Revolving Facility of $1,141 after deducting the outstanding letters of credit. Debt covenants — At June 30, 2024, we were in compliance with the covenants of our financing agreements. Under the Revolving Facility and the senior notes, we are required to comply with certain incurrence-based covenants customary for facilities of these types and, in the case of the Revolving Facility, a maintenance covenant tested on the last day of each fiscal quarter requiring us to maintain a first lien net leverage ratio not to exceed 2.00 to 1.00.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481544/470-10-50-6 Reference 2: 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