UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549 
                                  FORM 10-K 
 X    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
      ACT OF 1934 (FEE REQUIRED) 
For the fiscal year ended February 28, 1998

                                      OR

___   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from __________________ to ______________________

Commission File No. 1-8862

                           MARK IV INDUSTRIES, INC.                        
---------------------------------------------------------------------------
            (Exact name of Registrant as specified in its charter)

         Delaware                                     23-1733979           
-------------------------------          -----------------------------------
(State or other jurisdiction of          (IRS employer Identification number)
 incorporation or organization)

501 John James Audubon Pkwy., P.O. Box 810, Amherst, NY        14226-0810  
-------------------------------------------------------        ----------
(Address of principal executive offices)                       (Zip Code)

     Registrant's telephone number, including area code:  (716) 689-4972 

     Securities registered pursuant to Section 12(b) of the Act:
 
                                                        Name of exchange on
            Title of Class                                which registered  
            --------------                                -----------------
         Common Stock, $.01 par value                  New York Stock Exchange

     Securities registered pursuant to Section 12(g) of the Act: None 

      Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.  Yes  X .  No    .
                                                    ---      ---
     Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.  X 
                             ---
      The aggregate market value of the voting stock of the Registrant held by
non-affiliates of the Registrant based on the closing price of the Common
Stock on May 19, 1998 on the New York Stock Exchange was $1,128,332,066.
 
      As of May 19, 1998, the number of outstanding shares of Registrant's
Common Stock, $.01 par value, was 59,144,317 shares. 
 
                     Documents Incorporated By Reference 
 
      Portions of the Registrant's definitive proxy statement to be filed
pursuant to Regulation 14A not later than 120 days after the end of the fiscal
year are incorporated by reference into Part III. 


<PAGE>2
       

                           MARK IV INDUSTRIES, INC.
                            INDEX TO ANNUAL REPORT
                                 ON FORM 10-K


PART I                                                               Page

Item 1:     Business. . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
Item 2:     Properties. . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Item 3:     Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . 19
Item 4:     Submission of Matters to a Vote
             of Security Holders. . . . . . . . . . . . . . . . . . . . . . 19


PART II

Item 5:     Market for the Company's Common Stock and
             Related Security Holder Matters. . . . . . . . . . . . . . . . 19
Item 6:     Selected Financial Data . . . . . . . . . . . . . . . . . . . . 20
Item 7:     Management's Discussion and Analysis
             of Financial Condition and Results 
             of Operations. . . . . . . . . . . . . . . . . . . . . . . . . 22
Item 8:     Financial Statements and Supplementary 
             Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Item 9:     Disagreement on Accounting and Financial 
             Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . 55


PART III

Item 10:    Directors and Executive Officers of the 
             Registrant . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Item 11:    Executive Compensation. . . . . . . . . . . . . . . . . . . . . 55
Item 12:    Security Ownership of Certain Beneficial
             Owners and Management. . . . . . . . . . . . . . . . . . . . . 55
Item 13:    Certain Relationships and Related 
             Transactions . . . . . . . . . . . . . . . . . . . . . . . . . 55


PART IV

Item 14:    Exhibits, Financial Statement Schedules and 
             Reports on Form 8-K. . . . . . . . . . . . . . . . . . . . . . 55
            Signatures. . . . . . . . . . . . . . . . . . . . . . . . . . . 62
            Exhibit Index . . . . . . . . . . . . . . . . . . . . . . . . . 63

<PAGE>3

                                    PART I

ITEM 1.  BUSINESS
------   --------

General
-------
      Mark IV Industries, Inc. ("Mark IV" or "the Company") is a diversified
manufacturer of a broad range of proprietary and other power and fluid
transfer products and systems which serve primarily industrial and automotive
markets.  Many of Mark IV's product groups have a significant, and in certain
instances the leading share of their respective markets.  Products
manufactured by Mark IV principally serve specialized needs in markets in
which relatively few manufacturers compete.  These products are sold primarily
directly, but also through independent distributors, to other manufacturers
and commercial users in the United States and Europe and, to a lesser extent,
in Canada, Latin America and the Far East.  Mark IV operates 71 manufacturing
facilities and 45 distribution and sales locations and employs approximately
17,000 people in 20 countries.

      Mark IV's business strategy is focused on building its worldwide
Automotive and Industrial business segments through internal growth and
selective strategic acquisitions, and the continuation of cost control and
quality improvement programs.  The Company's operating strategy emphasizes
establishing cooperative programs with customers to engineer, design and
develop higher value-added systems in addition to individual products, the
introduction of new, more cost effective and durable products and systems, and
management for continuous improvement.

      In furtherance of these strategies, over its last five fiscal years,
Mark IV has:  

      (i)   enhanced its ability to provide a broader range of products to its
            existing customers through its $286.3 million acquisition of
            Purolator Products Inc. ("Purolator"), a leading manufacturer of
            automotive and industrial filtration products and systems in late-
            fiscal 1995;
      (ii)  established a joint venture in Brazil and is in the process of
            establishing manufacturing facilities in Argentina and Brazil; 
      (iii) established distribution centers to serve markets in Latin America
            and the Pacific Rim, and acquired manufacturing and distribution
            facilities in Mexico; 
      (iv)  increased its industrial hose and couplings production capacity
            and strengthened its position in the hose and couplings products
            market through its $78 million acquisition of Imperial Eastman at
            the beginning of fiscal 1997;
      (v)   emphasized continuous product development, with a portion of its
            current sales arising from the introduction of new products or
            products which have been redesigned; 
      (vi)  initiated during fiscal 1997 a restructuring of the Company's
            manufacturing and distribution facilities to make them more
            focused and cost effective; and
      (vii) expanded its international presence and capabilities to include
            air handling systems in its existing automotive fuel and fluid
            handling business through its $60 million acquisition of LPI
            Systemes Moteurs S.A. ("LPI") in October 1997.

<PAGE>4



Recent Developments
-------------------

      In May 1998, the Company announced the completion of its 7.3 million
share repurchase program initiated in March 1997.  The stock was purchased at
an average price of $22.00 per share, for a total cost of $160.7 million, with
3.8 million shares being repurchased in the first quarter of fiscal 1999 at an
average cost of $21.00 per share.  Upon completion of the buyback program, the
Company's Board of Directors authorized the purchase of an additional ten
million shares, representing approximately 17 percent of the Company's current
shares outstanding.  Under the new authorization, the stock will be purchased
in the open market or through privately negotiated transactions, from time to
time, at prices the Company considers to be attractive.

      In October 1997, as a part of its strategy to pursue selective strategic
acquisitions and expand its international presence, the Company acquired LPI
for a cash purchase price of approximately $60 million.  LPI operates three
manufacturing facilities in France, and supplies plastic air admission
systems, which include air intake manifolds and cooling modules produced by
injection, welding and blow molding technologies, for the automotive OEM
markets.  The LPI acquisition enables the Company's Automotive segment to
expand its systems capabilities to include air handling systems in addition to
the segment's existing fuel and fluid handling capabilities.

      In October 1997, the Company completed the private placement of $275
million principal amount of its 4-3/4% Convertible Subordinated Notes due 2004
(and subsequently exchanged them for equivalent notes registered under the
Securities Act of 1933, as exchanged, the 4-3/4% Notes).  The 4-3/4% Notes are
convertible into the Company's Common Stock at a price of $32.8125 per share,
subject to anti-dilution adjustments.

      In August 1997, the company completed the private placement of $250
million principal amount of its 7-1/2% Senior Subordinated Notes due 2007 (and
subsequently exchanged them for equivalent notes registered under the
Securities Act of 1933, as exchanged, the 7-1/2% Notes) at a purchase price of
99.471% of their face amount.

      The Company used a portion of the net proceeds from the transactions
described above to reduce outstanding senior indebtedness under the Company's
Credit Agreement and domestic demand lines, and to refinance its $258 million
principal amount of 8-3/4% Senior Subordinated Notes due April 1, 2003 (the 8-
3/4% Notes).  During fiscal 1998, $184.9 million of the 8-3/4% Notes were
acquired in open-market purchases and the remaining $73.1 million of the 8-
3/4% Notes were called and redeemed on April 2, 1998.

      In the third quarter of fiscal 1997, the Company announced a major
restructuring program aimed at focusing its businesses into two primary
operating units--Industrial and Automotive--with dedicated managements, as
well as manufacturing and distribution facilities, while at the same time,
capitalizing on common technologies.  The restructuring resulted in a pre-tax
charge against earnings of $112.5 million in fiscal 1997, with $51.8 million
non-cash portion of the charge representing primarily asset write-offs and
pension benefits to be paid out of the Company's pension fund.  The Company
expects to complete the restructuring and to begin to realize net benefits
from the restructuring in the third quarter of fiscal 1999--about six months
behind the Company's original estimates.

<PAGE>5

     During fiscal 1997, as part of the Company's strategy to become more
focused within its Industrial business segment, the Company sold its
Professional Audio, Vapor Corporation, Interstate Highway Signs, and Eagle
Signal businesses and certain other non-operating assets.  At the beginning of
1998, the Company also sold its Gulton Data Systems and LFE Industrial Systems
businesses.  The total of all of these divestitures generated gross proceeds
of approximately $313 million.  


Segment Information
-------------------
     The Company classifies its operations into the following two business
segments:

      (i)   Mark IV Industrial, which includes the design, manufacture and
            distribution of power and fluid management systems and components
            for industrial OEM and distribution markets worldwide; and

      (ii)  Mark IV Automotive, which includes the design, manufacture and
            distribution of (a) power transmission, fuel, and fluid handling
            systems and components, and (b) filters and filtration systems,
            for the global automotive aftermarket and OEM (original equipment
            manufacturers) market.

      Financial information regarding the business segments is presented in
Note 13 to the Company's audited consolidated financial statements included
elsewhere herein.  A more detailed discussion concerning the make-up of the
Company's two business segments follows.  


MARK IV INDUSTRIAL

      Mark IV Industrial provides Power and Fluid Management components and
systems, Transportation and Other, and Specialty Filtration products to
customers around the world.  Representing 45% of Mark IV's total revenue base,
Mark IV Industrial's sales were approximately $1.0 billion in fiscal 1998. 
The Company's focus in this segment includes serving its customers better by
expanding product offerings and improving quality and delivery, while at the
same time enhancing the utilization of its resources.  The Company's efforts
in these areas are geared to position it as a significant supplier of
industrial products in targeted markets.

      Combining the strengths of its brands, including Dayco(R), Purolator(R),
Swan(R), Imperial Eastman(R), Facet(R), Mark IV IVHS, Luminator, F-P
Electronics, Caplugs(R) and Statham, Mark IV Industrial is organized into
three primary operating units: Dayco Industrial, Transportation and Other, and
Specialty Filtration.

Dayco Industrial

      Dayco Industrial's future growth is focused on two primary areas: Power
and Fluid Management.  Its Power Management systems and components are used in
the transmission of power - either mechanically or through the use of
hydraulics or fluid power, while its Fluid Management products are used in the
movement containment, processing, treatment or control of fluids.  The systems
and components in these areas primarily consist of a variety of belts,
tensioners and pulleys; and hoses, couplings and assemblies, which are
specially designed for a variety of industrial applications.

<PAGE>6

      During fiscal 1998, the Company completed its acquisitions of Imperial
Eastman Australia, Australian Hose Manufacturing and Rubicon Industrial,
adding about $21 million to its annual revenue base.  The addition of these
companies expanded the Company's industrial products lines, and increased the
group's penetration in Australia.

      In the Power and Fluid Management areas, the Company is focused on
developing and supplying its products to the following targeted industrial
markets: agriculture, petroleum and mining, chemical, construction, forest
products, and manufacturing.  In these markets, the Company's products are
supplied directly to industrial OEMs, and through established distribution and
retail networks

Power Management Systems and Components

      Dayco manufactures specific lines of hydraulic hoses and couplings for
use in the mining industry - a global industry encompassing both underground
and above-ground processes, with each using different products and standards.
Expanding its product offerings this year, Dayco introduced the Day Minemaster
hose.  The Minemaster hose is designed with thicker, more abrasion-resistant
covers, larger diameter wire reinforcement, and thicker tubes to overcome the
harsh mining environment.  The new Minemaster hose, coupled with Dayco's
existing Coalmaster hose, provides Dayco with complete hydraulic coverage in
the mining industry.

      In Dayco's power transmission product line, which supplies synchronous
drive belts, advances in rubber compounding, construction and design are
responsible for the belt's performance, design flexibility, while saving
space, weight, energy and cost.  In most instances, RPP Plus synchronous drive
belts will replace old-fashioned timing belt, roller chain and gear-driven
drives, in addition to providing high-torque, high-efficiency performance.  

Fluid Management Systems and Components

      The Dayco Poly-Chem Ultra hose was designed and manufactured especially
for the chemical industry.  The patented inside tube handles most common
industrial chemicals, while the high grade outside cover is abrasion
resistant, non-marking, and easy to clean.  The Poly-Chem Ultra can handle a
wide range of temperatures, comes in a variety of lengths, is extremely
flexible, safer and lighter than other chemical hoses in the same class.

      In the consumer products arena, Dayco Swan introduced the Hoserap - a
unique new hands-free garden hose currently being patented.  Sold with a
sprinkling attachment, this handy water dispensing product has a flexible coil
inside of the hose with a "Memory" that allows it to be wrapped around
stationary objects, such as posts or lawn furniture, for hands-free
sprinkling.

Manufacturing Update

      Dayco Industrial's manufacturing performance - and versatility - were
significantly enhanced during the year by the addition of manufacturing space
in Alliance, Nebraska; El Paso, Texas; and Manitowoc, Wisconsin.

<PAGE>7



      Expanding its rigid mandrel hose capability, approximately 90,000 square
feet of manufacturing space was added to Dayco's Alliance plant to produce
high-pressure spiral wire hose for agricultural, construction and mining
equipment.

      Now fully operational, Dayco opened a manufacturing facility in El Paso,
Texas, to provide hose and belt products to its floor care customers.  

      In Manitowoc, a new kind of hydraulic hose manufacturing process is now
on line, which is expected to improve efficiencies and reduce labor costs. 
Dayco's "hybrid" hoses are manufactured from a newly developed, high-tech
process which combines special rubber and plastic materials.  Using these
space age polymers has enabled Dayco/Eastman to offer new and innovative
product differentiations to the mature hose industry.

Technology

      Dayco Direct, a significant new improvement in customer communications
in the industry, offers up-to-the-minute information to Dayco customers. 
Using Dayco Direct, customers have direct access to the unit's order entry
system enabling them to place and track orders in real time, via the Internet.

      Another technological innovation is Dayco Industrial's Automation Link
(DIAL) - the division's new technology-enabled selling system.  DIAL allows
the Company's sales force to access customer information and sales records
from a laptop computer, check inventory, and quickly provide pricing
information.  The DIAL system improves communications, enables Dayco
representatives to make calculations without waiting for reports from a
central office and, ultimately, increases customers satisfaction by reducing
cycle time.

TRANSPORTATION AND OTHER

      The Company's Transportation businesses provide a variety of mass
transit and traffic management systems to the transportation and
infrastructure industries in North America, Europe and Asia.  The group
consists of Mark IV IVHS, Luminator Mass Transit, Luminator Aircraft and F-P
Electronics in North America, as well as SLE, LLE and F-P Electronics, in
Europe.  The product lines include intelligent vehicle highway systems, and
information display and lighting systems, which are sold to mass transit
agencies, transportation authorities, bus, rail and aircraft OEMs, state and
local municipalities, and the transportation aftermarket.

Intelligent Vehicle Highway Systems

      Growth in the Company's transportation business was led by Mark IV IVHS,
which supplies a variety of products, including transponders, readers and
antennas, to the electronic toll market.  To date, the largest project in this
market is with the Interagency Group, which represents eleven transportation
authorities in New York, New Jersey, Pennsylvania, Delaware and Maryland. 
Successful installations to date include the New York State Thruway, the New
York City MTA Bridges and Tunnels, and the Port Authority.  With significant
growth in the Interagency Group and expansion of the E-ZPass system, more than
50% of travelers on the bridges and tunnels of New York are currently using E-
ZPass.

<PAGE>8


      Shipments of similar products have commenced to ISHTA, the major toll
road authority in Illinois, under the name I-Pass(R), where daily toll
transactions are comparable in volume to the very busy New Jersey corridor. 
In Canada, Highway 407, the first all-electronic toll road, was opened during
the year, with Mark IV supplying both transponders and readers.  In addition,
orders have now been received for readers, transponders, and toll kits for the
Massachusetts Turnpike Authority.  In South Carolina, electronic toll
collection, using Mark IV equipment, began in early March on the Cross-Island
Parkway, Hilton Head Island.

      The Company's growth is driven not only by the success of the E-ZPass
system, but also by finding new applications for equipment developed for
electronic toll collection systems.  Mark IV transponders are now used at both
the Ambassador Bridge between Detroit, Michigan and Windsor, Ontario, and at
the Peace Bridge near Buffalo, New York, for customs clearance of trucks at
these border crossings.  A truck's manifest is stored in a transponder, and is
then transmitted to the border prior to crossing.  This allows the border
inspector to review the manifest, and either wave the truck on, or instruct it
to pull over for further inspection, expediting the truck traffic at these
heavily used border crossings.  Also, at Pearson International Airport in
Toronto, Ontario, Canada, our transponders are also used to control access to
secured areas of the airport.

Information Displays

      Mark IV is a leading worldwide supplier of electronic passenger
information displays for public transportation vehicles.  F-P Electronics
manufactures the Optima(tm) line of hybrid LED magnetic disc displays.  These
displays are incorporated into bus and rail destination signs by Luminator and
LLE.  

      In Europe, Mercedes-Benz has selected LLE's Optima designs for several
bus models, including the new Citaro.  As a result of this selection, and the
acceptance of this product by the market, LLE's manufacturing facilities will
soon be doubled in size to accommodate this growth.

Traffic Control Products

      SLE has made a significant addition to its product line with the
introduction of traffic preemption products in London, England.  These
products enable a traffic signal to hold on green for high priority vehicles,
such as ambulances and police cars.  

Mass Transit and Aircraft Products

      Luminator Mass Transit has been selected to supply internal lighting
systems and external signs, over a three-year period, for the New York City
Transit Authority's new subway cars.  In addition, America's first Amtrak
high-speed passenger trains will feature Luminator(R) lighting fixtures in
every car.  Luminator designed a variety of fixtures to compliment these sleek
new cars to be built by Bombardier. 

      Luminator Aircraft has obtained a contract to supply passenger service
units on Boeing's 717 aircraft, as part of a joint development project between
Luminator, Drager of Germany, Fischer of Austria, and Boeing, Douglas Products
Division.  The new passenger service units will complement the other products
Luminator supplies on the 717, including entry, fluorescent aisle, and seat
marker lights, and exit signs.  Management believes this group has also
realized success in the aftermarket segment of the aircraft industry.

<PAGE>9

      In addition, Luminator Aircraft Products has entered into a joint
agreement with Ta Yih Industrial Co. Ltd. Of Taiwan to furnish Luminator's
night vision compatible interior and exterior lighting for Sikorsky military
and police helicopters in Taiwan.

Other Industrial Products

      Also included in this sector of the industrial business segment is the
Company's Protective Closures' Caplugs division, which manufactures, plastic,
metal, and vinyl caps, plugs, edge liners and protective netting sold to a
broad base of industrial and automotive OEM customers, and the Mokon division,
which produces circulating oil and water temperature control systems.  The
Company's Statham unit is a supplier of pressure measurement transducers for
use in commercial aviation, aerospace and corrosive process markets.  NRD is a
leading supplier of ionization elements used in smoke detectors, and also
manufactures self-energized, luminous exit signs, and static control devices
used mainly in the electronics and printing industries.  Kirkhof/Goodrich
manufacturers resistance welding products and transformers primarily for the
automotive industry.

SPECIALTY FILTRATION

      The Company's Specialty Filtration products include specialized
industrial fluid filters; heating and air conditioning filters for
residential, commercial and industrial users; and highly technical filters and
filtration systems.  These products are provided by the Company's Purolator
Filter Products, Facet International, and Purolator Products Air Filtration
operations.

Purolator Filter Products

      Through Purolator Filter Products, Mark IV Industrial provides
specialized industrial fluid filters for the aeropower, fluid processing, and
general industrial markets, as well as for government and military
applications.

      This unit has developed a sand control filtration technology for use in
the exploration and extraction of crude oil.  By controlling formation sand,
well life is enhanced and oil rigs can pump more crude oil, faster, and with
less downtime caused by clogging - a common problem of current sand control
filters.  To assure worldwide market penetration, Purolator Filter Products
entered into a strategic alliance with Halliburton, the world's leading
provider of oilfield products and services.  Under this agreement,
Halliburton, through its worldwide sales, is marketing PoroPlus(tm) screens,
the latest generation of sand control filters used in the oil and gas
industry.  The companies will share engineering, R&D, and manufacturing
resources to strengthen their alliance and develop new products for the
future.

Facet International

      Facet International designs, manufactures and sells filters, oil and
water separators, and refueling, filtration, anti-pollution, water recycling
systems, and bilge separators, for all types of liquids, gases, or liquid
gases, for aviation, marine, petrochemical, power generation and general
industrial markets.


<PAGE>10


      Facet is a worldwide provider of aviation refueling filtration and
separation systems with direct operations in ten countries.  The company has a
significant number of technical approvals throughout the world for its
commercial and military aviation products.  In addition, Facet International
recently developed a new type of bilge water separator to add to its already
wide range of marine products.


Purolator Products Air Filtration (PPAFC)

      Through PPAFC, Mark IV Industrial manufactures and distributes a broad
range of heating, ventilation and air conditioning (HVAC) filters and
filtration products for residential, commercial and industrial uses.  These
filters range from basic efficiency panel filters used in homes, to medium-and
high-efficiency products used in office buildings, hospitals and manufacturing
facilities.

      During fiscal 1998, PPAFC introduced the Purolator Filtration Systems'
new line of HVAC housing and equipment for new construction and retrofit
projects.  The line includes specialized equipment for technical environments,
such as contamination control and clean room applications.  The addition of
these products expands the Company's technical expertise and broadens its
product offerings.  Also during the year, two new products were added to
PPAFC's line of Defiant(R) medial products.  

      The Company has also expanded its high efficiency particulate air (HEPA)
filter line to include high temperature modes.  The expansion of the two
marketing lines of ULTRA-cell(R) and Micro-Air(R) allows Purolator to
participate in additional arenas such as the pharmaceutical and semiconductor
cleanroom industries.

      Also added were HEPA & American Society of Heating, Refrigeration, and
Air Conditioning Engineers (ASHRAE) filter housings for applications that have
been requested by the Company's customers.  The ASHRAE filter is a rigid box
design engineered to provide medium and high efficiency filtration combined
with a prolonged life cycle.  Its rugged design and construction makes this
filter effective in challenging applications where high humidity, turbulent
airflow, intermittent water exposure, and elevated operating temperatures
exist.

OUTLOOK

      Mark IV Industrial hopes to achieve growth in the coming decade by
developing and supplying products to its targeted markets.  Acquisitions and
strategic alliances created through collaborative engineering with customers
and specific product expertise, will provide additional areas of opportunity.

      In the global marketplace, demand is increasing for the systems and
components that Mark IV Industrial is strategically positioned to provide.  By
focusing on specific market segments where the Company has leadership
positions, and expanding our product offerings within these areas, as well as
in the geographic regions in which the Company participates, the Company will
continue to generate new growth opportunities.

<PAGE>11


     Mark IV Industrial is committed to satisfying the needs of its customers
by continuing to design, manufacture, and distribute its products in an
efficient and cost effective manner.  In addition Mark IV Industrial is
committed to expanding its product offerings - through product line
extensions, acquisitions and/or joint ventures - in order to expand its array
of power and fluid management, transportation systems and components and
specialty filtration products.

      In its targeted markets, growth is aimed primarily at strengthening Mark
IV Industrial's position in North America, Europe, Latin America and the
Asia/Pacific region.

      The Company is focused on allowing Mark IV Industrial to become a
dominant player in targeted industrial markets, while better serving its
customers.

MARK IV AUTOMOTIVE

      Mark IV Automotive designs, manufactures and sells a variety of high
quality automotive systems and components to the global automotive industry. 
Sales in this segment were approximately $1.2 billion in fiscal 1998,
representing 55% of Mark IV's total revenue in the year.  Approximately 62% of
the segment's sales were to OEM/OES customers, while the balance of the
Company's automotive products were sold to the aftermarket.

      Mark IV Automotive is focused on expanding its business to become a more
global supplier of safety, environmental and comfort related products to the
automotive industry.  During fiscal 1998, Mark IV Automotive's sales increased
7%, excluding results from newly acquired businesses, while strategic
acquisitions in Europe added approximately $94 million to its annual revenue
base.  In addition to adding to sales, the acquisitions of Mark IV Systemes
Moteurs (previously LPI), Nuova Eletta and M-Filter also provided the Company
with new products, technology and capacity.

AUTOMOTIVE OEM/OES

      Mark IV Automotive designs and supplies engineered systems and
components for the majority of automotive engine and platform manufacturers in
the world today, primarily serving OEMs in North America and Europe, and to a
lesser extent, in South America and Asia/Pacific.  

      In the automotive OEM market, the Company's emphasis is on providing
complete systems or subsystems to meet the needs of its customers.  Management
believes Mark IV Automotive is recognized as an innovator in its "systems"
orientation, which helps OEM customers to minimize their fixed expenses, and
allows the Company to increase its sales dollars per vehicle.  The Company's
efforts in this area over the past several years have been focused on
expanding its technological and engineering capabilities.  Today, Mark IV
Automotive is one of the world's leading automotive systems manufacturers in
the areas of power transmission, air intake, fuel, fluid handling and
filtration.


<PAGE>12
       

Technical Centers

      Mark IV Automotive has ten technical centers located in the U.S. and
Europe, each of which is dedicated to the development of products in its core
product areas.  Research and development activities and resources are
coordinated throughout these centers.  As a result, the Company is able to
avoid duplication and can capitalize on developments and improvements made in
its core technologies.

      Mark IV Automotive is customer oriented.  During fiscal 1998, the
company improved its organization structure in order to better serve its
customers' needs.  The biggest change can be found in the OEM/OES business,
where Mark IV Automotive now manufactures and distributes its automotive
systems and components through three new divisions:  the Engine Division,
Platform Division and Filter Division.

ENGINE DIVISION

The Engine Division includes systems and components which address customers'
Power Transmission and Air Intake needs.

Power Transmission Systems

      Mark IV Automotive is a leading manufacturer of accessory drive and
camshaft drive systems consisting of components such as belts, pulleys,
idlers, tensioners and dampers, as well as starter drives, for the global
automotive market.  The power transmission group is focused on providing fully
designed front end accessory drive systems, which offer customers increased
value and improved performance.

      During fiscal 1998, this group was successful in securing front-end
accessory drive business for future model years, from both North American and
European customers.  In addition, three new starter drive products for use in
heavy duty diesel engine applications were released during the year.  The
Company also received numerous top quality awards from customers, both
domestically and abroad.  Operationally, all of Mark IV automotive's power
transmission manufacturing facilities have received QS-9000 registration, and
are working toward receiving ISO-1400 certification for their environmental
control processes.

      Last year, a wholly-owned subsidiary, Dayco Argentina, S.A., was
established in Cordoba, Argentina, to provide camshaft and accessory drive
systems and components to the South American automotive OEM market and the
aftermarket.  With construction now complete and production scheduled to
commence during the second fiscal quarter of fiscal 1999, the Company will be
better positioned to serve its European OEM customers in that region,
including Fiat, Volkswagen, Renault and Peugeot.

Air Intake Systems

      New this past fiscal year, and also included in the Engine Division, are
air intake systems, which include a variety of high quality air intake
manifolds, engine cooling systems and components, ducts, thermostat housings,
brake fluid, surge and power steering tanks, and water pumps.

<PAGE>13

      Mark IV Automotive entered this market through the October 1997
acquisition of LPI (now known as Mark IV Systemes Moteurs), and the July 1997
acquisition of Nuova Eletta.  Mark IV Systemes Moteurs has three manufacturing
facilities and a technical center in France, while Nuova Eletta has a
production facility in Italy.  On a combined basis, these new operations
provide plastic air admissions systems, including air intake manifolds and
cooling modules produced by patented injection molding, welding, and blow
molding processes.

      The addition of Mark IV Systemes Moteurs significantly improves Mark IV
Automotive's competitive position and expands its product offerings.  Sold
primarily in Europe to leading automotive companies, including Peugeot,
Citroen, Renault, Ford, BMW, Porsche and Volkswagen--these new products will
now be marketed globally.  


PLATFORM DIVISION

      Mark IV Automotive's Platform Division provides systems and components
to meet its customers' Fluid Handling and Fuel Systems needs.

Fluid Handling Systems
      
      Mark IV Automotive is a world leader in the design and manufacture of
fluid handling systems.  The Company's fluid handling products consist of
hoses and hose assemblies for power steering, air conditioning, oil cooler and
other high-pressure applications, as well as radiator hose, heater hose and
other related hoses, couplings and assemblies.

      Almost 50% of vehicles produced in Europe today include both air
conditioning and power steering, while in the U.S., over 95% of all new
vehicles are comparably equipped.  The number of European cars which feature
these products is growing at a faster rate than the overall market,
representing a continuing growth opportunity for Mark IV Automotive in Europe.

      The Company's fluid handling unit is recognized as one of the few
suppliers in North America with vertically integrated hose and metal tubing
assembly operations.  This integrated capability results in optimal product 
solutions for customers, enabling them to depend on a single supplier for
complete design and manufacturing responsibility.

      The focus of the fluid handling group is to provide cost effective
system solutions that solve a variety of problems.  Mark IV Automotive's
products are expected to operate in extreme conditions, including a wide range
of temperatures, pressures, and corrosive environments, and to be able to
handle fluids ranging from gases to liquids.  These system requirements drive
the need for innovative research and development of new generation materials
and components, which are provided by the Company's technical centers in
Ocala, Florida, and Torino, Italy.  Mark IV Automotive has also been
successful in integrating innovative NVH (noise and vibration) solutions into
its fluid handling assemblies, generating several new NVH patents each year.

<PAGE>14

        
Fuel Systems

      Mark IV Automotive's fuel products include all systems and components
required for the safe transport of fuel--from the gas tank inlet into a
vehicle's gas tank, and from the tank into the engine.  Mark IV Automotive's
products vary from completed systems to individual components, including
tubes, hoses, couplings, fuel fillers, fuel pumps and other assemblies,
fittings, valves, canisters, filters and quick connectors.  These products are
currently manufactured in North America, Europe and South America, and are
sold to major OEM customers around the world.

      As automotive manufacturers continue to reduce their supply base, they
are placing increased responsibility for engineering and testing on their
suppliers, and sourcing complete systems rather than components.  In response,
Mark IV Automotive's fuel unit is focused on gaining competitive advantages by
expanding its global presence, remaining market driven, and establishing
alliances with customers, as well as other members of the automotive supply
community.  


FILTER DIVISION

      Mark IV Automotive is a leading manufacturer in a complete line of
automotive oil, air and fuel filters manufactured primarily in North America,
and distributed in North America, Europe, South America and the Asia/Pacific
region.

      On the OEM side of its business, new filter programs are in place which
are strengthening its position with customers.  All of the filters the Company
manufactures are OEM-approved, and 33% of them are sold to original equipment
service (OES) customers.  The Company is utilizing its research and
development capabilities, and working together with its customers to develop
new oil, cabin air, fuel and in-tank fuel filters.

      Expansion of the Company's filter business in Europe began in fiscal
1998 with the acquisition of M-Filter, a manufacturer of air and oil filters
located in Finland.  This acquisition provides Mark IV Automotive with its
first European filter manufacturing base.  In addition, the Company supplies
many of the filter needs of Renault, Toyota, Mazda, Subaru and Nissan.

      New product development is a key factor to ensuring the continued
success of Mark IV Automotive, and to meeting the demand for new technology
from the rapidly changing automotive market.  Mark IV Automotive's new TASO
(Take Apart Spin On) environmental oil filter -- with its permanent housing
and replaceable filter cartridge -- is "environmentally friendly" since the
filter element is designed to be incinerated after use.  The TASO is currently
being tested on a number of Chrysler leased vehicles.  Mark IV Automotive's
relationship with Chrysler, combined with its pro-active environmental stance,
led to Mark IV Automotive being selected to design and supply a similar
product for the Chrysler/BMW joint venture engine, to be manufactured in South
America and sold into Europe and North America.


<PAGE>15

        
AUTOMOTIVE AFTERMARKET

      In the automotive aftermarket, Mark IV Automotive provides an array of
automotive belts, hoses, filters and accessories to automotive warehouse
distributors, oil companies, quick lubes, original equipment service centers,
retail and auto parts chains, mass merchandisers, farm and fleet stores, and
hardware distributors.

      The belts and hoses manufactured and marketed primarily under the
company's Dayco(R) brand name, and the Company's Purolator(R) brand filters,
are widely recognized.  Through its restructuring activities, these two core
product lines have been integrated, streamlining the Company's sales and
marketing operations.

      In fiscal 1998 the Company opened a new, state-of-the-art, distribution
center in Fayetteville, North Carolina, to supply aftermarket products to
customers in the eastern portion of the U.S.  Reflecting a new approach to
aftermarket distribution, the 506,000 square foot Fayetteville center
consolidated four facilities into a single, more efficient operation that is
130,000 square feet smaller than the older facilities combined. 
Fayetteville's warehouse system is fully computerized and utilizes paperless
radio frequency (RF) equipment and bar coding technology, reducing costs,
shortening order turnaround time and improving accuracy.  

      The Company's European aftermarket sales organization was streamlined
during fiscal 1998, eliminating costs and improving customer service.  During
the year, the Company began selling its filter products to the Russian
marketplace, and is in the process of introducing belts and other products to
the region.  The Company also extended its range of timing belt kits -- which
include both a belt and a tensioner -- to its European customers.  

OUTLOOK

      Mark IV Automotive has experienced significant growth over the past
several years.  Increased capital spending has resulted in improved
productivity and competitiveness, which has helped support this segment's
sales growth.

      Continued growth in the Company's automotive business will be achieved
both internally, by increasing product content/dollar value per vehicle in
both existing and new markets, and externally, through acquisitions which
broaden product offerings in core technology areas and/or expand the company's
presence into new or developing geographic regions.  In addition, the Company
will continue to provide its customers with quality products and service,
while improving efficiencies and reducing costs.

      Mark IV Automotive's strength lies in its focus on the design,
development and manufacture of new or improved safety, environmental and
comfort related automotive products, predominantly for the OEM market.  The
company's technological capabilities, combined with increased investments in
research and development, will allow it to continue working with its customers
to provide solutions to today's automotive problems, and meet the needs of
tomorrow.


<PAGE>16


      The future of Mark IV Automotive will require an increased focus on the
OEM market, and leveraging its strength in this market to provide OEM-approved
products to its aftermarket customers.  During fiscal 1999, the Company will
work on strengthening its aftermarket operations.  This concentration,
combined with the Company's more streamlined operating structure and ongoing
rationalization activities, will help improve its position in today's global
automotive marketplace.


Marketing and Competition
------------------------- 
      Mark IV's products are marketed primarily in the United States and
Europe, and to a lesser extent in Canada, Latin America and the Far East.  The
Company uses its own sales engineers and other sales personnel, independent
distributors and sales representatives to market its products. 

      A majority of the Company's products have a significant and in many
instances the leading market share in their respective markets.  Most of the
markets for the Company's products are characterized by a limited number of
competitors; however, competition in certain of those markets is intense. 
Some of the Company's competitors are substantially larger than Mark IV and
have greater financial resources.  The Company competes on the basis of price,
quality, technical innovation and its ability to fill orders promptly, with
the relative importance of each factor depending on the market for the
particular product.  


Backlog
-------
      The Company does not believe that the backlog of orders for any of its
products is material to the Company as a whole.  


Patents and Trademarks
---------------------- 
      Although a number of patents and trademarks have been issued to the
Company and its subsidiaries, the Company believes its competitive position is
more dependent on its technical knowledge and processes than on patent or
trademark protection.  The Company believes, however, that its trademarks and
tradenames used in connection with certain products may be significant to its
business. 


Research and Development
------------------------
      The Company is engaged in ongoing research and development in connection
with new and existing products and systems.  Research and development
expenditures are expensed as incurred, and amounted to $48.5 million; $44.5
million and $36.8 million for the Company's continuing operations in fiscal
1998, 1997 and 1996, respectively.  It is anticipated that such costs will
increase as a percentage of sales in fiscal 1999 as a result of a number of
new product and systems initiatives which the Company is pursuing, as well as
the introduction of new technology to the North American automotive OEM market
from recent acquisitions in Europe.


<PAGE>17

        
Raw Materials and Supplies
-------------------------- 
      The materials and supplies used to produce the Company's products are
generally obtained from a wide variety of suppliers, and the Company has not
experienced any shortages.  Although certain materials are readily available
from only a few suppliers, the Company does not anticipate any significant
difficulties in obtaining any of these raw materials in the foreseeable
future. 

Government Regulation
--------------------- 
      Certain of the Company's electrostatic control devices, smoke-detector
ionization elements and self-illuminating lights have radioactive components,
the production, storage and transportation of which are subject to federal,
state and local laws and regulations.  Federal and state regulations also
limit the amount of exposure the Company's employees may have to such
radioactive materials.  The Company has obtained the necessary licenses and
approvals required for its businesses and believes it is in material
compliance with all applicable regulations concerning radioactive materials
and employee safety. 

      A small portion of the Company's business is conducted pursuant to U.S.
Government contracts or sub-contracts.  Generally, government contracts and
sub-contracts contain provisions permitting termination at any time at the
convenience of the Government upon payment to the Company of costs incurred
plus a profit related to the work performed to the date of termination.
Substantially all of the Company's government contracts and sub-contracts
contain these provisions.  The Company, as a government contractor, is subject
to various statutes and regulations governing defense contracts. 

      Certain federal and state environmental superfund statutes generally
impose joint and several liability on present and former owners and operators,
transporters and generators for remediation of contaminated properties,
regardless of fault.  The Company has been designated as a potentially
responsible party under these statutes at a number of sites.  Based on the
facts currently known to the Company, management expects that the costs to the
Company of remedial actions at the sites where it has been named a potentially
responsible party, will not have a material adverse effect on the Company's
results of operations or financial condition.

      The Company's facilities are also subject to many other federal, state
and local requirements relating to the protection of the environment, and the
Company has made, and will continue to make, expenditures to comply with such
provisions.  The Company believes that its facilities are in material
compliance with these laws and regulations and does not believe that future
compliance with such laws and regulations will have a material adverse affect
on its results of operations or financial condition.

      The Company's operations are also governed by many other laws and
regulations, including those relating to workplace safety and worker health,
principally the "Occupational Safety and Health Act" and regulations
thereunder which, among other requirements, establish noise and dust
standards.  The Company believes that it is in material compliance with these
laws and regulations and does not believe that future compliance with such
laws and regulations will have a material adverse affect on its results of
operations or financial condition.


<PAGE>18

Employees
---------
      The Company currently employs approximately 17,000 persons, of whom
approximately 13,200 are production employees, with the remainder serving in
executive, administrative, engineering or sales capacities.  The Company
currently has approximately 2,500 North American production employees that are
covered by 11 collective bargaining agreements which expire at various times
through the year 2001.  The Company believes its relationship with its
employees is good. 


Other
-----
      Mark IV was incorporated in Delaware in 1970 and its executive offices
are at 501 John James Audubon Parkway, Amherst, New York 14226-0810.  Its
telephone number is (716) 689-4972. Information on Mark IV can be obtained on
the Company's website at http://www.mark-iv.com.


ITEM 2.  PROPERTIES 
-------  ----------
      The table below summarizes the approximate floor space of the Company's
corporate office and principal manufacturing facilities by business segment. 
 
                                                   Approximate Floor Space
                                                   -----------------------
                                               (In Thousands of Square Feet)
                                              Owned       Leased      Total
                                              -----       ------      -----

Corporate Office                                 -          32,400     32,400
Industrial     (1) (3)                        3,652,100    713,300  4,365,400
Automotive     (2) (3)                        3,435,000  1,075,000  4,510,000



(1)   Consisting of the following forty facilities:  
      North American facilities (approximately 3,594,500 square feet):
      Springfield, MO; Fort Scott, KS; Alliance, NE; Eldora, IA; McCook, NE;
      Davenport, IA; Bucyrus, OH; Buffalo, NY; Vero Beach, FL; Stillwell, OK;
      Tulsa, OK; Henderson, NC; Kenly, NC; Davenport, IA; Sacramento, CA;
      Newark, NJ; Greensboro, NC; Mexico City, Mexico; Plano, TX; Mississauga,
      Ontario, Canada (2); Cobourg, Ontario, Canada;  Grand Island, NY;
      Hudsonville, MI; Costa Mesa, CA; Manitowoc, WI (2); Barrie, Ontario,
      Canada; Red Wing, MN and El Paso, TX.

      International Facilities (approximately 770,900 square feet): 
      Halesowen, U.K.; Torino, Italy; Barcelona, Spain; Treforest, Wales, UK;
      Lacoruna, Spain; Rastatt, Germany; and Nice, France; Perth, Australia;
      Sydney, Australia; and Adelaide, Australia.

(2)   Consisting of the following thirty-one facilities: 
      North American facilities (approximately 2,836,400 square feet): 
      Walterboro, SC; Williston, SC; Ocala, FL; Ft. Worth, TX; Springdale, AR;
      Weston, Ontario, Canada; Easley, SC; Lexington, TN; Fayetteville, NC;
      Salt Lake City, UT; Mississauga, Ontario, Canada; Detroit, MI and Big
      Rapids, MI.


<PAGE>19


      International facilities (approximately 1,673,600 square feet): Torino,
      Italy (2); Baudour, Belgium; Chieti, Italy; Manopello, Italy; Varberg,
      Sweden; Ulricehamn, Sweden; Blidsberg, Sweden: Valperga, Italy;
      Follonica, Italy; Melbourne, Australia; Juatuba, Brazil; Cordoba,
      Argentinia; Orbey, France; Fraize, France; Chateauroux, France;
      Scarperio, Italy and Haapavefi, Finland; 

(3)   The Automotive amounts include approximately 350,000 square feet from
      facilities listed in footnote 1 above.  This amount represents a portion
      of Industrial manufacturing facilities which manufacture products the
      Company classifies in its Automotive segment.
       
      The Company also owns or leases various small production facilities,
sales offices, distribution and research centers which are not included in the
above list of properties. 

      The Company believes that its existing facilities have sufficient
capacity to meet its anticipated needs in each of its industry segments for 
the foreseeable future.  


ITEM 3.  LEGAL PROCEEDINGS
-------  -----------------
      One of the Company's subsidiaries has been named as a defendant in a
number of litigation actions related to product supplied to one of the
subsidiary's customers.  The parties seek damages related to alleged defects
in certain hose products manufactured by the subsidiary and included by the
customer in its retail gasoline fuel delivery systems.  The Company believes
it has good and valid defenses against the claims, and has submitted a
counter-claim against the customer.

      The Company is also involved in various other legal issues.  In the
opinion of the Company's management, the ultimate cost to resolve these
matters will not have a material adverse effect on the Company's financial
position, results of operations or cash flows.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
-------  ---------------------------------------------------
      Not applicable.

                                   PART II 

ITEM 5.  MARKET FOR THE COMPANY'S COMMON STOCK AND RELATED SECURITY HOLDER     
-------  -----------------------------------------------------------------
          MATTERS
          -------
      The Company's Common Stock is listed on the New York Stock Exchange
(Symbol: IV).  The following table sets forth, for the fiscal periods
indicated, the high and low closing sale prices per share of the Company's
Common Stock as reported by the New York Stock Exchange.  All amounts have
been adjusted for the 5% stock dividend declared in April 1998.

                                 Fiscal 1998                   Fiscal 1997  
                               -----------------          -----------------
                               Low         High             Low         High
                               ---         ----             ---         ----
   1st Quarter                $22.143     $25.000         $18.125    $21.125
   2nd Quarter                $23.250     $25.438         $19.550    $22.375
   3rd Quarter                $22.000     $28.000         $19.000    $22.625
   4th Quarter                $20.250     $23.500         $19.875    $22.500

<PAGE>20

      As of February 28, 1998, the approximate number of holders of record of
the Company's Common Stock was 2,100.
 
      The Company declared total cash dividends of $.17 and $.14 per share
during fiscal 1998 and 1997, respectively.


ITEM 6.  SELECTED FINANCIAL DATA
-------  -----------------------

<TABLE>
<cption>
                            FIVE YEAR SUMMARY OF OPERATIONS
                     (Amounts in thousands, except per share data)

                                  Fiscal Year Ended the Last Day of February,      
                                    
                            1998        1997        1996        1995         1994   
                            ----        ----        ----        ----         ----
         <S>                <C>         <C>          <C>         <C>          <C>
Income Statement Data:
                        
 Net sales from         
  continuing operations  $2,210,200  $2,076,000  $1,779,200  $1,306,400   $  958,900  
                         ==========  ==========  ==========  ==========   ==========
 Operating income (a)    $  238,300  $  223,200  $  188,300  $  135,500   $  104,100  
                         ==========  ==========  ==========  ==========   ==========
 Restructuring charge          -     $  112,500        -           -            -     
                         ==========  ==========  ==========  ==========   ==========
 Interest expense        $   61,600  $   59,000  $   52,600  $   46,300   $   43,100  
                         ==========  ==========  ==========  ==========   ==========
 Income from continuing 
   operations(b):       
   Before restructuring 
    charge               $  109,200   $ 100,200   $  82,800   $  55,000   $   38,200  
   Restructuring charge        -        (67,500)       -           -            -     
                         ----------   ---------   ---------   ---------   ----------
      Total continuing      109,200      32,700      82,800      55,000       38,200
 Income from discontinued----------   ---------   ---------   ---------   ----------
   operations (b):      
   Before divestitures         -          5,900       9,600      12,900       12,900  
   Gain on divestitures        -         17,500        -           -           -      
                         ----------   ---------   ---------   ---------   ----------
      Total discontinued       -         23,400       9,600      12,900       12,900
                         ----------   ---------   ---------   ---------   ----------
 Extraordinary items (b)    (10,600)       -           -         (1,100)     (21,700)
 Cumulative effect of   
  accounting change(b)         -           -           -           -         (26,000) 
                         ----------   ---------   ---------   ---------   ----------
     NET INCOME          $   98,600   $  56,100   $  92,400   $  66,800   $    3,400
                         ==========   =========   =========   =========   ==========
 Basic earnings       
  per share:                     
  Continuing operations:
   Before restructuring 
    charge                $    1.70   $    1.51    $    1.25   $   1.03    $     .78  
   Restructuring charge         -         (1.02)         -          -            -    
                          ---------   ---------    ---------   --------    ---------
      Total continuing         1.70         .49         1.25       1.03          .78
  Discontinued operations:---------   ---------    ---------   --------    ---------
    Before divestitures         -           .09          .15        .24          .26  
    Gain on divestitures        -           .26          -          -            -    
                          ---------   ---------    ---------   --------    ---------
      Total discontinued        -           .35          .15        .24          .26
                          ---------   ---------    ---------   --------    ---------
  Extraordinary items          (.16)        -            -         (.02)        (.44)
  Accounting change             -           -            -          -           (.53) 
                          ---------   ---------    ---------   --------    ---------
      NET INCOME          $    1.54   $     .84    $    1.40   $   1.25    $     .07
                          =========   =========    =========   ========    =========

</TABLE>

<PAGE>21
<TABLE>
<CAPTION>

                                 Fiscal Year Ended the Last Day of February,       
                                    
                             1998        1997       1996        1995       1994    
                             ----        ----       ----        ----       ----
     <S>                     <C>         <C>         <C>        <C>         <C>
 Diluted earnings 
  per share:                     
  Continuing operations:
   Before restructuring 
    charge                  $   1.66  $    1.50    $   1.24   $    .96    $    .72  
   Restructuring charge          -        (1.01)        -          -           -    
                            --------  ---------    --------   --------    --------
      Total continuing          1.66        .49        1.24        .96         .72
                            --------  ---------    --------   --------    --------
  Discontinued operations:
    Before divestitures          -          .09         .15        .21         .22  
    Gain on divestitures         -          .26         -          -           -    
                            --------   --------    --------   --------    --------
      Total discontinued         -          .35         .15        .21         .22
                            --------   --------    --------   --------    --------
  Extraordinary items           (.16)       -           -         (.02)       (.37)
  Accounting change              -          -           -          -          (.44) 
                            --------   --------    --------   --------     -------
      NET INCOME            $   1.50   $    .84    $   1.39   $   1.15     $   .13
                            ========   ========    ========   ========     =======
 Cash dividends paid    
  per share                 $    .17   $    .14    $    .11   $    .10     $   .08  
                            ========   ========    ========   ========     =======
 Weighted average       
  number of shares                     
  outstanding:      
    Basic                     64,100     66,300      66,200     53,600      49,100  
    Diluted                   67,400     66,700      66,600     60,700      58,700  

</TABLE>

<TABLE>
<CAPTION>

                                       As of the Last Day of February,           
                                    
                             1998       1997        1996        1995       1994    
                             ----       ----        ----        ----       ----
      <S>                     <C>       <C>         <C>        <C>          <C>
 Balance Sheet Data:
                        
  Working capital        $  458,400 $  364,600  $  404,900 $  379,700   $  312,800
                        
  Total assets           $2,420,500 $1,974,600  $2,013,100 $1,846,400   $1,282,300
                        
  Long-term debt         $  793,900 $  528,500  $  642,500 $  610,700   $  567,200
                        
  Stockholders' equity   $  752,000 $  758,400  $  725,500 $  635,500   $  345,400

<FN>
____________________________
(a)  Income from continuing operations before restructuring charge, interest expense   
      and taxes.
(b)  Net of related tax effects.

</FN>
</TABLE>



<PAGE>22



Item 7.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
-------      ---------------------------------------------------------------
             RESULTS OF OPERATIONS
             ---------------------

Liquidity and Capital Resources
-------------------------------

The Company's short-term capital needs are met by cash generated through
operations, and supplemented by borrowings under various credit facilities to
the extent required.  During fiscal 1998, net cash provided by earnings
(income from continuing operations before restructuring and non-cash items)
was $229.5 million, a 22% increase over the $187.6 million generated in fiscal
1997, which in turn represented an increase of $24.8 million (15%) over the
$162.8 million generated in fiscal 1996.  At February 28, 1998, the Company's
working capital investment was $458.4 million, a net increase of $93.8 million
(26%) in comparison to $364.6 million at February 28, 1997.  Approximately
$46.5 million of the increase was caused by the net effects of the purchase of
short-term investments with a portion of the proceeds from the Company's
issuance of 7-1/2% and 4-3/4% Notes ($119.6 million), partially offset by the
reclassification of the 8-3/4% Notes which were called and redeemed on April
2, 1998 ($73.1 million).  The remaining $47.3 million (13%) increase in the
Company's working capital investment over the prior year is primarily related
to operations acquired in fiscal 1998, and temporary working capital
requirements to support the transition resulting from the Company's
restructuring program.  Management anticipates its working capital investment
will be significantly reduced during fiscal 1999 as a result of the completion
of its restructuring program and the implementation of a new company-wide
incentive compensation plan which is focused on cash flow generation.  The
Company's working capital investment at February 28, 1997 represented a
decrease of $40.3 million (10%) in comparison to the total at February 29,
1996.

Capital expenditures related to continuing operations in fiscal 1998 were
$156.5 million, which exceeded depreciation and amortization expense of $79.9
million for the year, and reflects an increase of $47.3 million over fiscal
1997's capital expenditures.  The increased level of expenditures relates
primarily to the Company's restructuring efforts, and secondarily to new
facilities and equipment required to support new products and markets,
including increased business opportunities in Europe and South America. 
Capital expenditures related to continuing operations in fiscal 1997 were
$109.2 million, which exceeded depreciation and amortization expense of $69.0
million for the year, and reflects an increase of $18.7 million over fiscal
1996's expenditures of $90.5 million.  The increased level of expenditures in
fiscal 1997 relates to the Automotive segment, with new facilities and
equipment expenditures required to support new products and increased business
opportunities primarily in the U.S. and Italy, and also in its expansion
efforts in Brazil, Argentina and Australia.  Excluding the effects of Imperial
Eastman, capital expenditures in the Industrial segment in fiscal 1997 were up
slightly from the level incurred in fiscal 1996.  Management anticipates that
the Company's capital expenditure requirements will return to more normal
levels in fiscal 1999 (approximately $80.0 million) as the Company completes
its restructuring plan.  

Cash provided by earnings in fiscal 1998 was sufficient to fund the Company's
capital expenditure investments, as well as the cash expenditure requirements
of its restructuring efforts during the fiscal year.  Management believes that
cash generated from earnings will be more than sufficient to fund such needs
for the foreseeable future.  Management intends to utilize such excess, plus
funds generated as a result of the Company's anticipated reduction in its
working capital investment, to help fund the repurchase of its Common Stock,
acquisitions and debt reductions.


<PAGE>23



In addition to the capital expenditures identified above, other investment
activities of the Company during the past few years include the following:

-      In October 1997, the Company acquired the net assets of LPI Systemes
       Moteurs S.A. (LPI) for a net cash purchase price of approximately $60
       million.  LPI, based in France, manufactures plastic air admission
       systems which include air intake manifolds and cooling modules produced
       by injection molding, welding and blow molding technologies.  LPI is
       included in the Company's Automotive business segment.  The Company
       also made a number of smaller acquisitions in Europe and Australia
       during fiscal 1998 for a total cost of approximately $30.2 million.

-      In March 1997, the Company announced its intention to acquire up to 7.3
       million shares of its Common Stock outstanding.  It is expected that
       such shares would be purchased in the open-market, or through privately
       negotiated transactions, at prices which the Company considers to be
       attractive.  Through February 28, 1998, the Company acquired
       approximately 3.5 million of such shares, at an average cost of $23.14
       per share, or a total cost of approximately $80.4 million.  Subsequent
       to the end of the fiscal year, the Company acquired an additional 3.8
       million of its shares at an average cost of $21.00 per share, or a
       total cost of approximately $80.3 million.  These purchases completed
       the Company's 7.3 million share repurchase program, at an average cost
       of $22.00 per share, or a total cost of approximately $160.7 million.

-      During fiscal 1997, the Company initiated a restructuring of its
       manufacturing and distribution facilities which is expected to improve
       customer service, reduce costs and dedicate its facilities to either
       the Automotive or Industrial business segments.  The restructuring
       resulted in a pre-tax charge against earnings of $112.5 million, with
       $51.8 million related to cash expenditures required to be made
       primarily over a two-year period.  The remaining $60.7 million non-cash
       portion of the charge represents primarily asset write-offs and pension
       benefits to be paid out of the Company's pension fund.  Although the
       Company has experienced a delay of approximately 6 months from its
       initial timeline for the completion of its restructuring plan, it has
       now completed a substantial portion of its restructuring program.  The
       Company expects to realize a net benefit from its restructuring
       activities beginning in the second half of fiscal 1999.

-      During fiscal 1997, as part of the Company's strategy to become more
       focused within its Industrial business segment, the Company sold its
       Professional Audio, Vapor Corporation, Interstate Highway Signs and
       Eagle Signal businesses and certain other non-operating assets.  In
       fiscal 1998, the Company sold its Gulton Data Systems and LFE
       Industrial Systems businesses.  The total of all of these divestitures
       generated gross proceeds of approximately $313 million.

-      At the beginning of fiscal 1997, the Company acquired the net assets of
       Imperial Eastman for a cash purchase price of approximately $78
       million.  Imperial Eastman is a manufacturer and marketer of a broad
       range of thermoplastic hydraulic and pneumatic hose assemblies, and
       steel and brass couplings, adapters and fittings for both high and low
       pressure applications.  Imperial Eastman is included in the Company's
       Industrial business segment.


<PAGE>24



-      During fiscal 1997, the Company acquired the net assets of Cinotto
       Tecnomeccanica S.p.A. (CTM) for a cash purchase price of approximately
       $17.2 million.  Near the end of fiscal 1996, the Company also acquired
       the net assets of FitzSimons Manufacturing Company (FitzSimons) for a
       cash purchase price of approximately $24.4 million.  Both of these
       acquisitions are a part of the Automotive business segment, and enabled
       the segment to extend its systems delivery capability in its fuel
       systems and power transmission businesses worldwide.

The Company's long-term capital needs are met by cash generated from earnings,
bank financing, and public debt and equity offerings.  Recent long-term
financing activities include the following:

-      In October 1997, the Company completed the private placement of $275
       million principal amount of its 4-3/4% Convertible Subordinated Notes
       due 2004 (and subsequently exchanged them for equivalent notes
       registered under the Securities Act of 1933, as exchanged, the 4-3/4%
       Notes).  The 4-3/4% Notes are convertible into the Company's Common
       Stock at a price of $32.8125 per share, subject to anti-dilution
       adjustments.  

-      In August 1997, the Company completed the private placement of $250
       million principal amount of its 7-1/2% Senior Subordinated Notes due
       2007 (and subsequently exchanged them for equivalent notes registered
       under the Securities Act of 1933, as exchanged, the 7-1/2% Notes) at a
       purchase price of 99.471% of their face amount.  

-      The Company used a portion of the net proceeds from the transactions
       described above to reduce outstanding senior indebtedness under the
       Company's Credit Agreement and domestic demand lines, and to refinance
       its $258 million principal amount of 8-3/4% Senior Subordinated Notes
       due April 1, 2003 (the 8-3/4% Notes).  During fiscal 1998, $184.9
       million of the 8-3/4% Notes were acquired in open-market purchases and
       the remaining $73.1 million of the 8-3/4% Notes were called and
       redeemed on April 2, 1998.

-      In March 1996, the Company entered into a $500 million, five-year non-
       amortizing revolving credit facility (the "Credit Agreement") with
       various financial institutions.  The proceeds of the initial borrowings
       under the Credit Agreement were used to repay amounts outstanding under
       the Company's previously existing credit agreements.  

-      In March 1996, the Company also completed the sale of $250 million
       principal amount of its 7-3/4% Senior Subordinated Notes due 2006 (the
       7-3/4% Notes).  The net proceeds from the sale of the 7-3/4% Notes were
       used to reduce outstanding indebtedness under the Credit Agreement.   

As of February 28, 1998, the Company had borrowing availability under its
Credit Agreement of $500 million and availability under its various other
domestic and foreign demand lines of credit of approximately $174 million.  



<PAGE>25


Foreign Currency
----------------

The Company does not hold or issue derivatives for trading purposes and is not
a party to leveraged derivatives transactions.  The Company's sales from
foreign locations and exports are significant; therefore, the Company does
enter into foreign currency forward contracts as a hedge for certain existing
or anticipated business transactions denominated in various foreign
currencies.  The maximum notional amount of foreign currency forward contracts
outstanding at any one time during fiscal 1998 was not significant.


Results of Operations
---------------------

The Company classifies its operations into the following two business
segments:

       (i)   Automotive, which includes the design, manufacture and
             distribution of (a) power transmission, fuel, and fluid handling
             systems and components, and (b) filters and filtration systems,
             for the global automotive aftermarket and OEM (original equipment
             manufacturers) market; and

       (ii)  Industrial, which includes the design, manufacture and
             distribution of power and fluid management systems and components
             for industrial OEM and distribution markets worldwide.

The results of operations of LPI, Imperial Eastman and the smaller
acquisitions have been included in the Company's results of operations from
their respective dates of acquisition, as reflected in the Company's audited
financial statements, including the segment information identified in Note 13
to such financial statements.  Results related to the Company's discontinued
operations have been excluded from the results of continuing operations for
all periods presented and discussed herein.

Net sales from continuing operations increased $134.2 million (7%) in fiscal
1998 in comparison to fiscal 1997.  Such sales were negatively effected by
approximately $60.0 million as a result of unfavorable foreign currency
exchange rate movements during fiscal 1998.  If exchange rates in fiscal 1998
had remained consistent with the rates in effect in fiscal 1997, net sales
from continuing operations in fiscal 1998 would have increased approximately
9% in comparison to fiscal 1997.  The increase in fiscal 1998's sales was
primarily attributable to internal sales growth, and to a lesser extent to the
inclusion of the results of operations of LPI and several smaller acquisitions
from their respective dates of acquisition.  

In the Company's Industrial segment, net sales in fiscal 1998 increased $36.2
million (4%) in comparison to fiscal 1997.  Excluding businesses divested in
fiscal 1997, net sales in fiscal 1998 increased approximately 8% in comparison
to fiscal 1997.  This increase was lead by internal growth in the segment's
general industrial and transportation sectors in the U.S., while the
Industrial segment's operations outside of the U.S. remained relatively flat,
year over year.

In the Company's Automotive segment, net sales in fiscal 1998 increased $98.0
million (9%) in comparison to fiscal 1997.  Excluding LPI and several smaller
acquisitions, the Automotive segment's net sales in fiscal 1998 increased
approximately 7% in comparison to fiscal 1997.  The internal growth in the
Automotive segment was primarily generated by the segment's Automotive OEM 



<PAGE>26

sector, with OEM growth in the U.S. leading the way.  The Company's negative
movements in foreign currency exchange rates during fiscal 1998 related
primarily to the Automotive segments OEM business.  In the Aftermarket sector,
internal sales increased nominally in fiscal 1998 in comparison to fiscal
1997, with a slight increase on the maintenance (filters) side offset by a
slight decrease in the traditional (belts and hose) side of the sector.

Net sales in fiscal 1997 increased approximately $300 million (16.7%) in
comparison to fiscal 1996, with approximately $190 million of the increase
generated by the Industrial segment (a 24.5% increase) and approximately $110
million generated by the Automotive segment (a 11% increase).  Reflecting the
effects of acquisitions during the periods, the increase on a pro forma basis
was approximately $140 million, with $75 million generated by the Automotive
segment and $65 million generated by the Industrial segment, with each segment
reflecting an increase of approximately 7% over fiscal 1996.

The pro forma sales increase in the Automotive segment for fiscal 1997 was led
by growth in markets outside of the U.S. of approximately 13%, with the
majority of the increase occurring in both the aftermarket and OEM markets in
Europe.  The segment's sales in the U.S. were up approximately 4%, with the
growth in the OEM market somewhat stronger than in the aftermarket.  The pro
forma sales increase in the Industrial segment for fiscal 1997 was led by
growth in the U.S. markets of approximately 8%, while the segment's sales
outside of the U.S. were up approximately 4%.

Cost of products sold as a percentage of consolidated net sales were 67.7%,
67.8%, and 67.7% in fiscal 1998, 1997 and 1996, respectively.  This consistent
level of costs indicates the negative pressures on the margins experienced by
both of the Company's business segments have been substantially offset by the
positive effects of the Company's cost control and cycle time reduction
programs.  Benefits anticipated from the Company's restructuring plan have
been substantially offset during the current year by operating inefficiencies
resulting from the transition of the manufacture of certain products from one
facility to another.  It is anticipated that the Company's current
restructuring program will have a net beneficial effect on the level of such
costs beginning in the second half of fiscal 1999.

Selling and administration costs as a percentage of consolidated net sales
were 15.7%, 16.0% and 16.3% in fiscal 1998, 1997 and 1996, respectively. The
reduced level of costs reflects operating efficiencies achieved from the
integration of the operations acquired and the reorganization of the Company's
business segments.  The lower level of costs also indicates the Company's
continued emphasis on cost control and cycle time reduction has been
successful in offsetting the impact of inflation on such costs.

Research and development costs increased by $4.0 million (9%) in fiscal 1998
in comparison to fiscal 1997, which in turn increased by $7.7 million (21%) in
comparison to fiscal 1996.  As a percentage of consolidated net sales, such
costs were approximately 2.2% in each of fiscal 1998, 1997 and 1996.  This
consistent level of investment reflects the Company's continuing emphasis on
new product development.  It is anticipated that such costs will increase as a
percentage of sales in fiscal 1999 as a result of a number of new product and
systems initiatives which the Company is pursuing, as well as the introduction
of new technology to the North American Automotive OEM market from recent
acquisitions in Europe.


<PAGE>27



Depreciation and amortization expense increased by $10.9 million (16%) in
fiscal 1998 in comparison to fiscal 1997, which in turn increased by $9.8
million (17%) in comparison to fiscal 1996.  The increases are attributable to
increased levels of capital equipment expenditures in the past two years to
support the Company's restructuring efforts as well as new facilities and
equipment required to support new products and markets and increased business
opportunities in Europe and South America.

The above mentioned items resulted in the following operating income (before
the restructuring charge) for each of the fiscal years presented (dollars in
millions):
                             1998                1997              1996
                       ----------------    ---------------    ---------------
                                 % of                % of               % of
                                Related            Related            Related
                       Amount    Sales     Amount   Sales     Amount   Sales 
                       ------   -------    ------  -------    ------  -------
OPERATING INCOME

Automotive             $132.7    11.0%     $122.1   11.0%     $ 110.6  11.0%
Industrial              121.4    12.1%      120.5   12.5%        95.1  12.3%
Total operating
 income before 
 corporate expenses     254.1    11.5%      242.6   11.7%       205.7  11.6%

Corporate expenses      (15.8)   (0.7)%     (19.4)  (0.9)%      (17.4) (1.0)%

Operating income       $238.3    10.8%     $223.2   10.8%      $188.3  10.6%
                       ======    =====     ======   =====      ======  =====

The $112.5 million restructuring charge recognized in fiscal 1997 relates to
the Company's decision to realign and refocus its operations.  The effect of
this charge, after taxes, reduced income from continuing operations by $67.5
million, or $1.01 per diluted share of Common Stock.

Interest expense in fiscal 1998 increased $2.6 million (4%) over fiscal 1997,
which in turn increased $6.4 million (12%) over fiscal 1996.  The increase is
primarily due to borrowings incurred to finance the Company's stock repurchase
program and the acquisition of LPI and several smaller acquisitions, as well
as to support higher working capital levels.  This increase was substantially
offset by the benefits of proceeds from asset divestitures and reduced rates
on the Company's domestic debt, primarily related to the issuance of the 7-
1/2% and 4-3/4% Notes to refinance higher rate debt.  The increase in fiscal
1997 is primarily the result of increased borrowings required to finance the
Imperial Eastman and FitzSimons acquisitions. 

The effective tax rate as a percentage of pre-tax accounting income for fiscal
1998 reflects an expense of 38.2%, compared to an expense of approximately
36.8% and 39% in fiscal 1997 and 1996, respectively.  The reason for the
fiscal 1997 rate differing from the other fiscal years is primarily due to the
restructuring charge which provided a slightly higher tax benefit than the 39%
blended rate on earnings before the restructuring charge.  Excluding the
effects of the restructuring charge, the Company's provision for income taxes
as a percentage of pre-tax accounting income for fiscal 1997 was approximately
39%.  The decrease in the effective tax rate in fiscal 1998 is primarily
related to the benefit of increased domestic income resulting from internal
growth that outpaced income growth in international locations with higher
statutory tax rates than in the U.S.  The higher rates in comparison to the
U.S. statutory tax rate are primarily the result of income in international
jurisdictions with higher statutory tax rates than in the U.S., and state and
local taxes.


<PAGE>28

Income from continuing operations in fiscal 1998 increased $9.0 million (9%)
over the comparable amount for fiscal 1997 (before the restructuring charge),
which in turn increased $17.4 million (21%) over fiscal 1996.  On a diluted
per share basis, such amount for fiscal 1998 represents an increase of $.16
(11%) over the comparable amount for fiscal 1997, which in turn increased $.26
(21%) over fiscal 1996. The unfavorable foreign currency exchange rate
movements had the effect of reducing diluted earnings per share by
approximately $.07 in fiscal 1998.

The Company's income from continuing operations in fiscal 1997 was made up of
the following elements (dollars in thousands, except per share amounts):

     Elements of the Company's income from
     continuing operations:
       Income before restructuring charge               $100,200
       Restructuring charge                              (67,500)
                                                        --------
         Income from continuing operations              $ 32,700
                                                        ========
     Diluted income per share from 
     continuing operations:
       Income before restructuring charge               $   1.50
       Restructuring charge                                (1.01)
                                                        --------
          Income from continuing operations             $    .49
                                                        ========

Year 2000 Issues
----------------

Mark IV has developed a formal plan, called Project 2000, to ensure that all
of its date-sensitive computer systems and other equipment utilized in its
various manufacturing, distribution and administration activities will be Year
2000 compliant and operational on a timely basis.

The plan addresses every Mark IV location throughout the world.  It also
includes a review of computer applications that directly connect elements of
the Company's business to its customers and suppliers, as well as an
assessment process to determine that all of its significant suppliers of
materials, components and services also will be Year 2000 compliant.

The Company's implementation of its Project 2000 plan involved capital
expenditures for computer software and hardware, and, in certain instances,
new or modified equipment.  In many cases, the investments made for new
systems and modifications not only provide for Year 2000 compliance, but also
enhance the Company's current processes.

The Company does not believe that the costs of achieving Year 2000 compliance
will significantly impact the results of its operations or financial position.


Impact of Inflation
-------------------

Although the Company has experienced delays in its ability to pass on certain
inflation related cost increases, the Company does not expect that such delays
or the overall impact of inflation will have a material impact on the
Company's operations.

<PAGE>29



Forward-Looking Information
---------------------------

This Management's Discussion and Analysis of Financial Condition and Results
of Operations and other sections of this Annual Report contain forward-looking
statements that are based on current expectations, estimates and projections
about the industries in which the Company operates, as well as management's
beliefs and assumptions.  Words such as "expects", "anticipates", "intends",
"plans", "believes", "seeks", "estimates", variations of such words and
similar expressions are intended to identify such forward-looking statements. 
These statements are not guarantees of future performance and involve certain
risks, uncertainties and assumptions ("Future Factors") which are difficult to
predict.  Therefore, actual outcomes and results may differ materially from
what is expressed or forecasted in such forward-looking statements.  The
Company undertakes no obligation to update publicly any forward-looking
statements, whether as a result of new information, future events or
otherwise.

The Future Factors that may affect the operations, performance and results of
the Company's businesses include the following:

       a.    general economic and competitive conditions in the markets and
             countries in which the Company operates, and the risks inherent
             in international operations and joint ventures;
       b.    the Company's ability to continue to control and reduce its costs
             of production;
       c.    the level of consumer demand for new vehicles equipped with the
             Company's products;
       d.    the level of consumer demand for the Company's aftermarket
             products, which varies based on such factors as the severity of
             winter weather, the age of automobiles in the Company's markets
             and the impact of improvements or changes in original equipment
             products; 
       e.    the effect of changes in the distribution channels for the
             Company's aftermarket and industrial products; and,
       f.    the strength of the U.S. dollar against currencies of other
             countries where the Company operates, as well as cross-currencies
             between the Company's operations outside of the U.S. and other
             countries with whom they transact business.

Should one or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary materially
from those described in the forward-looking statements.  The Company does not
intend to update forward-looking statements.



<PAGE>30




ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
-------  --------------------------------------------


                        Index to Financial Statements 

                                                                          Page
Report of Independent Accountants for 
   each of the three fiscal years in the 
   period ended February 28, 1998                                          31
 
Consolidated Balance Sheets at February 28, 1998 
 and 1997                                                                  32
 
Consolidated Statements of Income for each of 
  the three fiscal years in the period ended 
  February 28, 1998                                                        33

Consolidated Statements of Stockholders' Equity for
  each of the three fiscal years in the period
  ended February 28, 1998                                                  34

Consolidated Statements of Cash Flows 
  for each of the three fiscal years in 
  the period ended February 28, 1998                                       35
 
Notes to Consolidated Financial Statements                                 36






<PAGE>31











                       REPORT OF INDEPENDENT ACCOUNTANTS
                       ---------------------------------




To the Board of Directors and Stockholders
 of Mark IV Industries, Inc.



We have audited the accompanying consolidated balance sheets of Mark IV
Industries, Inc. and Subsidiaries as of February 28, 1998 and 1997, and the
related consolidated statements of income, stockholders' equity and cash flows
for each of the three fiscal years in the period ended February 28, 1998. 
These financial statements are the responsibility of the Company's management. 
Our responsibility is to express an opinion on these financial statements
based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements are free of
material misstatement.  An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements.  An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation.  We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Mark IV
Industries, Inc. and Subsidiaries as of February 28, 1998 and 1997, and the
consolidated results of their operations and their cash flows for each of the
three fiscal years in the period ended February 28, 1998, in conformity with
generally accepted accounting principles.


                                             


                                             Coopers and Lybrand, LLP




Rochester, New York
March 18, 1998



<PAGE>32


                                 MARK IV INDUSTRIES, INC.
                                CONSOLIDATED BALANCE SHEETS
                                FEBRUARY 28, 1998 and 1997
                                  (Dollars in Thousands)
    


      ASSETS                                       1998             1997   

Current Assets:
  Cash and short-term investments               $  120,900       $    1,300
  Accounts receivable                              466,400          390,100
  Inventories                                      393,400          377,600
  Other current assets                             105,600           76,500
      Total current assets                       1,086,300          845,500
                                                             
Pension and other non-current assets               226,600          214,000
Property, plant and equipment, net                 668,400          553,300
Cost in excess of net assets acquired              439,200          361,800
                                                             
      TOTAL ASSETS                              $2,420,500       $1,974,600
                                                ==========       ========== 
   LIABILITIES & STOCKHOLDERS' EQUITY                        
                                                             
Current Liabilities:                                         
  Notes payable and current maturities          $  133,800       $   89,300
  8-3/4% Notes, called for redemption               73,100             -
  Accounts payable                                 222,400          188,400
  Compensation related liabilities                  75,500           89,300
  Accrued interest                                  28,600           20,400
  Other current liabilities                         94,500           93,500
      Total current liabilities                    627,900          480,900
                                                             
Long-Term Debt:                                              
  Senior debt                                       21,400           22,000
  Subordinated debt                                772,500          506,500
      Total long-term debt                         793,900          528,500

Other non-current liabilities                      246,700          206,800

Stockholders' Equity:
  Preferred stock - $.01 par value;
   Authorized 10 million shares;
   No issued shares                                   -               -
  Common stock - $.01 par value;                             
   Authorized 200 million shares;                            
   Issued 62.9 million shares in 1998 and                      
   66.3 million shares in 1997                         600              700
  Additional paid-in capital                       617,800          696,500
  Retained earnings                                167,100           79,300
  Foreign currency translation adjustment          (33,500)         (18,100)
     Total stockholders' equity                    752,000          758,400

     TOTAL LIABILITIES                                       
      & STOCKHOLDERS' EQUITY                    $2,420,500       $1,974,600
                                                ==========       ==========

The accompanying notes are an integral part of these financial statements.


<PAGE>33
<TABLE>
<CAPTION>

                                 MARK IV INDUSTRIES, INC. 
                            CONSOLIDATED STATEMENTS OF INCOME 
                 YEARS ENDED THE LAST DAY OF FEBRUARY 1998, 1997 and 1996
                       (Amounts in Thousands, Except Per Share Data)




                                                    1998         1997          1996   
                                                               
            <S>                                      <C>          <C>            <C>

Net sales from continuing operations             $2,210,200   $2,076,000    $1,779,200
Operating costs: 
  Cost of products sold                           1,497,000    1,408,100     1,205,100
  Selling and administration                        346,500      331,200       289,800
  Research and development                           48,500       44,500        36,800
  Depreciation and amortization                      79,900       69,000        59,200
  Restructuring charge                                 -         112,500          -   
     Total operating costs                        1,971,900    1,965,300     1,590,900
    Operating income                                238,300      110,700       188,300
Interest expense                                     61,600       59,000        52,600
  Income from continuing operations,
   before provision for taxes                       176,700       51,700       135,700
Provision for taxes                                  67,500       19,000        52,900
  Income from continuing operations                 109,200       32,700        82,800
Income from discontinued operations:
  Income from operations, net of taxes                 -           5,900         9,600
  Gain on divestitures, net of taxes                   -          17,500          -   
    Total income from discontinued operations          -          23,400         9,600
Extraordinary loss from early extinguishment 
 of debt, net of tax benefits                       (10,600)        -             -    
     NET INCOME                                  $   98,600   $   56,100    $   92,400
Net income per share of common stock:  
  Basic:
   Income from continuing operations             $     1.70   $      .49    $     1.25
   Income from discontinued operations                  -            .35           .15
   Extraordinary loss                                  (.16)          -            -   
     NET INCOME                                  $     1.54   $      .84    $     1.40
  Diluted:
   Income from continuing operations             $     1.66   $      .49    $     1.24
   Income from discontinued operations                  -            .35           .15
   Extraordinary loss                                  (.16)         -             -    
     NET INCOME                                  $     1.50   $      .84    $     1.39
Weighted average number of shares outstanding:
  Basic                                              64,100       66,300        66,200
  Diluted                                            67,400       66,700        66,600




The accompanying notes are an integral part of these financial statements.

</TABLE>



<PAGE>34

<TABLE>
<CAPTION>

                                 MARK IV INDUSTRIES, INC.
                      CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                 YEARS ENDED THE LAST DAY OF FEBRUARY 1998, 1997 AND 1996
                       (Dollars in Thousands, Except Per Share Data)


                                                                         Foreign
                                                Additional               Currency
                                     Common      Paid-in    Retained   Translation
                                     Stock       Capital    Earnings    Adjustment
                                     -----       -------    --------    ----------
         <S>                          <C>         <C>        <C>            <C>

Balance at February 28, 1995         $  600     $550,200    $ 90,800     $ (6,100)

  Net income for fiscal 1996                                  92,400
  Cash dividends of $.113 per share                           (7,500)
  Stock dividend of 5%                            66,000     (66,000)
  Restricted stock amortization                    1,300
  Stock options activity,
   including related tax benefits                    100
  Translation adjustment                                                    3,700 

Balance at February 29, 1996            600      617,600     109,700       (2,400)

  Net income for fiscal 1997                                  56,100
  Cash dividends of $.138 per share                           (9,100)
  Stock dividend of 5%                  100       77,300     (77,400)                      
  Restricted stock amortization                    1,300
  Stock options activity,
   including related tax benefits                    300 
  Translation adjustment                                                  (15,700)

Balance at February 28, 1997            700      696,500      79,300      (18,100)

  Net income for fiscal 1998                                  98,600
  Cash dividends of $.17 per share                           (10,800)
  Purchase and retirement of 
   3,474,420 shares of Common 
   Stock (average cost of 
   $23.14 per share)                   (100)     (80,300)
  Restricted stock amortization                    1,300 
  Stock options activity,
   including related tax benefits                    300
  Translation adjustment                                                  (15,400)

Balance at February 28, 1998         $  600     $617,800    $167,100     $(33,500)


The accompanying notes are an integral part of these financial statements.


</TABLE>


<PAGE>35
<TABLE>


                                 MARK IV INDUSTRIES, INC.
                           CONSOLIDATED STATEMENTS OF CASH FLOWS
                 YEARS ENDED THE LAST DAY OF FEBRUARY 1998, 1997 AND 1996
                                  (Dollars in Thousands)



                                               1998        1997          1996  
                                               ----        ----          ----

            <S>                                <C>          <C>           <C>

Cash flows from operating activities:
  Income from continuing operations          $109,200    $ 32,700      $ 82,800
  Items not affecting cash:                                 
   Depreciation and amortization               79,900      69,000        59,200
   Deferred income taxes                       54,300      23,200        25,700
   Pension income, net of other items         (13,900)     (4,800)       (4,900)
   Restructuring charge, net of tax              -         36,400          -
  Changes in assets and liabilities, net                   
   of effects of acquired and
   divested businesses:                     
    Accounts receivable                       (49,500)    (43,200)        5,900 
    Inventories                               (15,800)    (31,900)      (27,800)
    Other assets                               (8,000)    (20,700)      (17,900)
    Accounts payable and other liabilities    (45,800)     (1,200)      (26,800)
     Net cash provided by continuing
      operating activities                    110,400      59,500        96,200
     Net cash provided by (used in) 
      discontinued operations                    -          1,400        (2,100)
  Extraordinary items before deferred charges (11,700)       -             -   
    Net cash provided by operating activities  98,700      60,900        94,100

Cash flows from investing activities:                       
  Acquisitions                                (90,200)    (95,200)      (28,200)
  Divestitures and asset sales                 36,700     276,600         1,600
  Purchase of plant and equipment, net:
    Continuing operations                    (153,500)   (106,900)      (87,100)
    Discontinued operations                      -         (4,000)       (5,000)
     Net cash provided by (used in)
      investing activities                   (207,000)     70,500      (118,700)

Cash flows from financing activities:                       
  Credit agreement borrowings, net               -        (97,300)     (242,700)
  Issuance of subordinated debt, net of fees  515,400        -          243,900
  Retirement of subordinated debt            (184,900)       -             -
  Other changes in long-term debt, net          1,400     (16,700)        3,400
  Changes in short-term bank borrowings       (13,100)     (8,200)       27,500
  Common stock transactions                   (80,100)        300           100
  Cash dividends paid                         (10,800)     (9,100)       (7,500)
     Net cash provided by (used in)                                 
      financing activities                    227,900    (131,000)       24,700
     Net increase in cash and 
      short-term investments                  119,600         400           100
Cash and short-term investments:                            
  Beginning of the year                         1,300         900           800
  End of the year                            $120,900    $  1,300      $    900


The accompanying notes are an integral part of these financial statements.



</TABLE>




<PAGE>36


                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.  The Company and its Significant Accounting Policies

The Company

Mark IV Industries, Inc. and Subsidiaries (the Company) is a diversified
manufacturer of proprietary and other products, with operations primarily in
automotive and industrial power and fluid transfer and filtration businesses.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and
all of its subsidiaries.  All significant intercompany transactions have been
eliminated.  The consolidated financial statements have been prepared in
conformity with generally accepted accounting principles, which requires
management to make estimates and assumptions that affect the reported and
contingent amounts of assets and liabilities as of the date of such financial
statements, and the reported amounts of revenues and expenses during the
reporting periods.  It should be recognized that the actual results could
differ from those estimates.

Cash and Short-term Investments

Short-term investments consist of temporary bank deposits and money market
instruments with various financial institutions that have maturities not
exceeding April 2, 1998.  At February 28, 1998 these short-term investments
amounted to $119.6 million.  For purposes of cash flows, the Company considers
overnight investments as cash equivalents.  The Company paid interest of
approximately $58 million, $62 million and $64 million in fiscal 1998, 1997
and 1996, respectively. The Company paid income taxes of approximately $27
million, $26 million and $26 million in fiscal 1998, 1997 and 1996,
respectively.  

Concentrations of Credit Risk

Financial instruments which potentially subject the Company to concentrations
of credit risk consist principally of periodic temporary investments of excess
cash and trade receivables.  The Company places its temporary excess cash and
short-term investments in temporary bank deposits and high quality short-term
money market instruments through several high credit quality financial
institutions.  The credit risk associated with trade receivables is minimal
due to the Company's large customer base and ongoing control procedures which
monitor the credit worthiness of customers.  Historically, the Company has not
experienced significant losses on trade receivables.

Inventories

Inventories are stated at the lower of cost or market, with cost determined
primarily on the last-in, first-out (LIFO) method.




<PAGE>37





                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Property, Plant and Equipment

The Company provides for depreciation of plant and equipment primarily on the
straight-line method over its useful life.  The cost of property, plant and
equipment retired or otherwise disposed of, and the accumulated depreciation
thereon, are eliminated from the asset and related accumulated depreciation
accounts, and any resulting gain or loss is reflected in income.    

Cost in Excess of Net Assets Acquired

Cost in excess of net assets acquired (goodwill) is amortized on the straight-
line method over 40 years.  The Company continually evaluates the existence of
goodwill impairment on the basis of whether the goodwill is fully recoverable
from projected, undiscounted net cash flows of the related business.  

Foreign Currency

The assets and liabilities of the Company's international subsidiaries are
translated at year-end exchange rates, and resulting gains and losses are
accumulated as a separate component of stockholders' equity.  Foreign currency
transactions are included in income as realized.  The Company enters into
foreign currency forward contracts as a hedge for certain existing or
anticipated business transactions denominated in foreign currencies.  Gains or
losses on contracts related to existing business transactions are deferred and
recognized as the related transactions are completed, while those related to
anticipated transactions are recognized as of the balance sheet date.  The
Company does not hold or issue derivatives for trading purposes and is not a
party to leveraged derivatives transactions.

Earnings Per Share of Common Stock

The Company adopted Statement of Financial Accounting Standards No. 128 -
Earnings Per Share (SFAS No. 128) in the fourth quarter of fiscal 1998.  SFAS
No. 128 is intended to simplify the earnings per share computations and make
them more comparable from company to company.  All prior year earnings per
share amounts have been recalculated in accordance with the earnings per share
requirements under SFAS No. 128; however, such recalculation did not result in
any change to the Company's previously reported earnings per share for all
years presented. 

Basic earnings per share is calculated on the basis of the weighted average
number of shares outstanding, adjusted for subsequent stock distributions.
Diluted earnings per share, in addition to the weighted average determined for
basic earnings per share, includes common stock equivalents which would arise
from the exercise of stock options using the treasury stock method, and
assumes the conversion of the Company's 4-3/4% Convertible Subordinated Notes
for the period outstanding during fiscal 1998.


<PAGE>38
        

                           MARK IV INDUSTRIES, INC. 
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 


Stock-Based Compensation

In October 1995, the Financial Accounting Standards Board (the FASB) issued
Statement of Financial Accounting Standards No. 123 - Accounting for Stock-
Based Compensation (SFAS No. 123), which became effective for the Company's
fiscal year ended February 28, 1997.  SFAS No. 123 requires companies to
recognize compensation expense for grants of stock options, or provide pro
forma disclosures relative to what the effect of such accounting recognition
would have been.  The Company has chosen not to recognize compensation expense
for options granted under its Incentive Stock Option Plans, and the related
pro forma information has been presented in Note 12 to these consolidated
financial statements.  Tax benefits received by the Company upon the exercise
and subsequent sale of the options by its employees are recognized as an
increase in additional paid-in capital as they occur.

Reclassifications

Certain reclassifications of 1997 and 1996 financial statements and related
footnote amounts have been made to conform with the 1998 presentation.


2.     Restructuring

During fiscal 1997, the Company began to realign and refocus its operations,
including the closure of certain facilities with an aggregate of one million
square feet of manufacturing and distribution/warehousing space.  The
realignment will result in the termination of approximately 1,700 employees,
with a net reduction of approximately 1,000 employee positions.  As a part of
this realignment, facilities producing both automotive and industrial products
are being dedicated to one or the other of the Company's business segments. 
The restructuring is expected to be substantially completed by the middle of
fiscal 1999.  In this regard, the Company recognized a restructuring charge of
$112.5 million in fiscal 1997, and such amount has been identified separately
in the accompanying consolidated statements of income.  The primary elements
of the charge are as follows (dollars in thousands):


                                                Amounts
                                              Expended or        Balance
                                            Adjusted During    Remaining at
                                 Initial     the Fiscal Year   February 28, 
                                 Charge      1997      1998        1998   
                                 -------    -------    ------    ---------
Non-cash charges                $ 60,700   $(60,700)  $   -     $    -   
Facility closing and lease
 run-out costs                    24,700     (5,500)    (9,000)    10,200 
Employee termination  
 and other costs                  27,100    (13,100)    (6,100)     7,900
  Pre-tax charge                 112,500    (79,300)   (15,100)    18,100
Tax benefit                       45,000    (31,700)    (6,100)     7,200
  Net of tax charge             $ 67,500   $(47,600)  $ (9,000) $  10,900 


<PAGE>39


                           MARK IV INDUSTRIES, INC. 
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 


The non-cash charges included fixed asset impairments and amounts to be paid
to employees out of the Company's master defined benefit pension plan, as well
as the accelerated recognition of related unamortized pension costs.  The
employee termination and other costs include amounts to be paid directly by
the Company to employees of certain of the Company's manufacturing and
distribution facilities in the U.S. and Europe.  


3.  Acquisitions and Divestitures

In October 1997, the Company acquired the net assets of LPI Systemes Moteurs
S.A. (LPI) for a net cash purchase price of approximately $60 million.  LPI,
based in France, manufactures plastic air admission systems which include air
intake manifolds and cooling modules produced by injection molding, welding
and blow molding technologies.  LPI is included in the Company's Automotive
business segment.  The Company also made a number of smaller acquisitions in
Europe and Australia during fiscal 1998.

In fiscal 1997, the Company acquired the net assets of Imperial Eastman for a
cash purchase price of approximately $78 million.  Imperial Eastman is a
manufacturer and marketer of a broad range of thermoplastic hydraulic and
pneumatic hose assemblies and steel and brass couplings, adapters and fittings
for both high and low pressure applications.  Imperial Eastman is included in
the Company's Industrial business segment.

In fiscal 1996, the Company acquired the net assets of FitzSimons
Manufacturing Company (FitzSimons) for a cash purchase price of approximately
$24.4 million.  FitzSimons is a manufacturer of fuel system components for the
North American automobile and truck industries, and is included in the
Company's Automotive business segment.

In fiscal 1998, the Company sold its Data Systems and LFE Industrial Systems
businesses.  Such businesses were included in the results of operations of the
Company's Industrial segment through their respective disposal dates.

In fiscal 1997, the Company sold its Professional Audio business, as well as a
number of other non-core businesses.  The results of operations for such
divested businesses have been presented as discontinued operations in the
Company's consolidated statements of income through their respective disposal
dates.  




<PAGE>40

        

                           MARK IV INDUSTRIES, INC. 
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 


4.  Accounts Receivable and Inventories

Accounts receivable are reflected net of allowances for doubtful accounts of
$13.6 million and $14.7 million at February 28, 1998 and 1997, respectively.  

Inventories consist of the following at February 28, 1998 and 1997 (dollars in
thousands):
                                                         1998         1997 
                                                         ----         ----
      Raw materials                                   $ 86,200     $ 87,200
      Work-in-process                                   73,000       68,700
      Finished goods                                   234,200      221,700
               Total                                  $393,400     $377,600


As a result of the fair value determination of inventories required by the
purchase method of accounting for acquired companies as of their acquisition
date, LIFO costs exceed historical FIFO costs by approximately $38.7 million
and $37.2 million at February 28, 1998 and 1997, respectively.   


5.  Property, Plant and Equipment

Property, plant and equipment are stated at cost and consist of the following
at February 28, 1998 and 1997 (dollars in thousands):


                                                         1998         1997 
                                                         ----         ----

   Land and land improvements                         $ 25,900     $ 25,000
   Buildings                                           179,900      146,800
   Machinery and equipment                             641,800      529,800
     Total property, plant and equipment               847,600      701,600
   Less accumulated depreciation                       179,200      148,300
     Property, plant and equipment, net               $668,400     $553,300


Depreciation expense related to continuing operations was approximately $65.6
million, $55.7 million and $46.8 million in fiscal 1998, 1997 and 1996,
respectively.  

6.  Cost in Excess of Net Assets Acquired 

Cost in excess of net assets acquired is presented net of accumulated
amortization of approximately $51.1 million and $41.2 million at February 28,
1998 and 1997, respectively.  Cost in excess of net assets acquired at
February 28, 1998 reflects an increase of approximately $90 million related to
the Company's acquisitions in fiscal 1998, as well as final purchase
accounting for the acquisition completed in fiscal 1997.  Amortization expense
related to continuing operations was approximately $10.8 million, $9.6 million
and $8.4 million in fiscal 1998, 1997 and 1996, respectively.  



<PAGE>41


                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


7.  Long-Term Debt

Long-term debt consists of the following at February 28, 1998 and 1997
(dollars in thousands):
                                                    1998              1997   
   Senior debt:                                     ----              ----
     Credit Agreement                            $     -           $     -   
     Other items                                     31,200            27,400
       Total senior debt                             31,200            27,400
     Less current maturities                         (9,800)           (5,400)
       Net senior debt                               21,400            22,000
   Subordinated debt:
     4-3/4% Convertible Subordinated Notes          275,000              -   
     7-1/2% Senior Subordinated Notes               248,800              -
     7-3/4% Senior Subordinated Notes               248,700           248,500
     8-3/4% Senior Subordinated Notes                73,100           258,000
       Total subordinated debt                      845,600           506,500
     Less current portion                           (73,100)             -   
       Net subordinated debt                        772,500           506,500
       Total long-term debt                         793,900           528,500
   Stockholders' equity                             752,000           758,400
       Total capitalization                      $1,545,900        $1,286,900
       Long-term debt as a percentage
        of total capitalization                       51.4%             41.1%

The Company's primary credit agreement (the Credit Agreement) provides for a
non-amortizing revolving credit facility through March 2001, with borrowing
availability of $400 million under a domestic facility (the Domestic Credit
Facility) and $100 million under a multi-currency facility (the Multi-Currency
Credit Facility).  The Multi-Currency Credit Facility permits borrowings to be
made in U.S. dollars as well as specified foreign currencies.  

Borrowings under the Domestic Credit Facility bear interest at an annual rate
equal to, at the Company's option, either (i) the greater of (a) the reference
rate of the agent acting on behalf of the various banks or (b) the Federal
Funds Rate plus 0.50% or (ii) LIBOR plus a margin (the Applicable Margin)
ranging from 0.225% to 0.35% depending upon the Company's consolidated
leverage ratio, as determined on a quarterly basis.  Borrowings under the
Multi-Currency Credit Facility bear interest at the LIBOR rate for the
currency of each loan plus the Applicable Margin.  The Company is also
required to pay a commitment fee at an annual rate ranging from 0.125% to
0.20% of the total borrowing availability under the Credit Agreement (the
Facility Fee Rate), determined on the basis of the same consolidated leverage
ratio.  Based upon the Company's consolidated leverage ratio as of February
28, 1998, the Applicable Margin and Facility Fee Rate are 0.225% and 0.15%,
respectively. 


<PAGE>42

        

                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



The Credit Agreement contains customary covenants, including those requiring
the maintenance of specified consolidated interest coverage and leverage
ratios and amounts of consolidated net worth.  Borrowings under the Credit
Agreement are guaranteed by the Company's significant domestic and
international subsidiaries and are collateralized by a pledge of the capital
stock of each of such subsidiaries.

In October 1997, the Company completed the private placement of $275 million
principal amount of its 4-3/4% Convertible Subordinated Notes due 2004 (and
subsequently exchanged them for equivalent notes registered under the
Securities Act of 1933, as exchanged, the 4-3/4% Notes).  The 4-3/4% Notes are
convertible into the Company's Common Stock at a price of $32.8125 per share,
subject to anti-dilution adjustments.  The 4-3/4% Notes are general unsecured
obligations of the Company and are subordinated in right of payment to all
existing and future senior indebtedness and senior subordinated notes.

In August 1997, the Company completed the private placement of $250 million
principal amount of its 7-1/2% Senior Subordinated Notes due 2007 (and
subsequently exchanged them for equivalent notes registered under the
Securities Act of 1933, as exchanged, the 7-1/2% Notes) at a purchase price of
99.471% of their face amount.  The 7-1/2% Notes are general unsecured
obligations of the Company and are subordinated in right of payment to all
existing and future senior indebtedness, and rank the same in right of payment
as the Company's 7-3/4% Senior Subordinated Notes.  

The 7-3/4% Notes are due 2006 and are general unsecured obligations of the
Company.  The 7-3/4% Notes are subordinated in right of payment to all
existing and future senior indebtedness, and rank the same in right of payment
as the Company's 7-1/2% Notes.  

The Company used a portion of the net proceeds from the transactions described
above to reduce outstanding senior indebtedness under the Company's Credit
Agreement and domestic demand lines, and to refinance $184.9 million of its
$258 million principal amount of 8-3/4% Senior Subordinated Notes due April 1,
2003 (the 8-3/4% Notes).  The Company recognized an extraordinary charge in
fiscal 1998 of $10.6 million, net of $6.5 million of tax benefits, for the
early extinguishment of debt.  The remaining $73.1 million principal amount of
the 8-3/4% Notes were called for redemption on April 2, 1998 at 104.375% of
principal amount and, as such have been classified as a current liability in
the accompanying consolidated balance sheet as of February 28, 1998.

Based on market quotes and interest rates currently available to the Company
for debt with similar terms and remaining maturities, the aggregate fair value
of total long-term debt at February 28, 1998 and 1997 was approximately $794
million and $526 million, respectively.

Annual maturities of long-term debt for the next five fiscal years are $82.9
million in fiscal 1999 and approximately $5.0 million in each of the years
thereafter.


<PAGE>43




                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

8.  Leases

The Company has operating leases which expire at various dates through 2010
with, in some instances, cost escalation and renewal privileges.  Total rental
expense under operating leases related to continuing operations was
approximately $14.8 million, $16.8 million and $16.5 million in fiscal 1998,
1997 and 1996, respectively.  Future minimum rental payments under operating
leases are approximately:  1999-$11.7 million; 2000-$10.0 million; 2001-$9.3
million; 2002-$8.5 million; 2003-$7.2 million; and 2004 and thereafter - $16.5
million. 


9.  Income Taxes

Income from continuing operations, before provision for taxes, and the related
provision for taxes for fiscal 1998, 1997 and 1996 consists of the following
(dollars in thousands):

                                           1998        1997       1996     
                                           ----        ----       ----
Income before provision for taxes:
   United States                         $109,500     $ 87,700   $ 71,900  
   International                           67,200       76,500     63,800  
   Restructuring charge                      -        (112,500)      -   
       Total                             $176,700     $ 51,700   $135,700  
 
Provision for taxes:
  Currently payable:
   United States                         $  1,500     $ 24,600   $ 13,700  
   International                           17,800       16,200     13,500  
   Restructuring related                   (6,100)     (31,700)      -   
       Total currently payable             13,200        9,100     27,200  
  Deferred:
   United States                           42,000       12,900     14,800  
   International                            6,200       10,300     10,900
   Restructuring related                    6,100      (13,300)      -   
       Total deferred                      54,300        9,900     25,700  
       Total provision for taxes         $ 67,500     $ 19,000   $ 52,900     


The provision for taxes on income from continuing operations for fiscal 1998,
1997, and 1996 differs from the amount computed using the United States
statutory income tax rate as follows (dollars in thousands):

                                            1998       1997       1996     
                                            ----       ----       ----
Expected tax at United States
 statutory income tax rate                $61,800    $18,100    $ 47,500
Permanent differences                       2,600      2,100       1,400
State and local income taxes                2,300     (1,300)      2,300
Foreign tax rate differences
 and other items, net                         800        100       1,700   
    Total provision for taxes             $67,500    $19,000    $ 52,900   




<PAGE>44


                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


The tax effects of temporary differences which give rise to a significant
portion of deferred tax assets (liabilities) consist of the following at
February 28, 1998 and 1997 (dollars in thousands):


                                                     1998         1997  
                                                     ----         ----
Current:
   Tax credit carryforwards                       $ 20,600      $ 12,000
   Insurance related liabilities                    10,200         6,000
   Restructuring liabilities                         6,600         8,300
   Compensation related liabilities                  6,600         6,200
   Other current items                               4,400         2,900 
     Net current asset                            $ 48,400      $ 35,400
Non-current:
   Fixed and intangible assets                    $(41,400)     $(36,000)
   Pension and postretirement related items        (18,200)      (12,000)
   Other non-current items                           3,200        23,100     
     Net non-current liability                    $(56,400)     $(24,900)


Based on the Company's history of prior operating earnings and its
expectations for the future, management of the Company has determined that it
is more likely than not that operating income will be sufficient to enable it
to realize its deferred tax assets, including tax credit carryforwards which
begin to expire in 2007.  The undistributed earnings of the Company's
international subsidiaries have been reinvested in each country, and are not
expected to be remitted back to the parent company.  


10.  Pension and Other Postretirement Benefit Plans

The Company has adopted SFAS No. 132 - Employers' Disclosures about Pensions
and Other Postretirement Benefits (SFAS No. 132).  SFAS No. 132 is intended to
standardize certain footnote disclosure requirements for pensions and other
retiree benefits.  Information concerning the Company's defined benefit
pension plans consists of the following (dollars in thousands):


                                           Defined Benefit Pension Plans
                                           -----------------------------
                                            1998        1997        1996
                                            ----        ----        ----
Change in Plan Assets:

  Fair value of plan assets at
   the beginning of the year             $ 418,000   $ 366,400   $ 335,400
  Acquisitions                                -         20,800        -
  Actual return on plan assets              95,000      57,300      67,200
  Benefits paid                            (41,600)    (26,500)    (36,200)
  Fair value of plan assets at
   the end of the year                   $ 471,400   $ 418,000   $ 366,400



<PAGE>45




                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


                                           Defined Benefit Pension Plans
                                           -----------------------------
                                            1998        1997        1996
                                            ----        ----        ----
Change in Benefit Obligations:

  Benefit obligations at the
   beginning of the year                 $(337,100)  $(303,100)  $(273,700)
  Acquisitions                                -        (24,500)       -
  Service cost                              (4,800)     (5,600)     (3,800)
  Interest cost                            (23,800)    (23,300)    (23,100)
  Curtailment losses                          (400)     (2,400)     (1,200)
  Special termination benefits                -        (16,000)       - 
  Change in the discount rate              (17,900)       -        (35,900)
  Other actuarial gains (losses)           (13,600)     11,300      (1,600)
  Benefits paid                             41,600      26,500      36,200
  Benefit obligations at the
   end of the year                       $(356,000)  $(337,100)  $(303,100)

Funded Status Reconciliation:

  Funded status                          $ 115,400   $  80,900   $  63,300
  Unrecognized actuarial losses             12,600      30,900      48,800
  Unrecognized prior service costs           1,700       1,100       7,500
  Prepaid benefit recognized in the
   consolidated balance sheet
   at the end of the year                $ 129,700   $ 112,900   $ 119,600

Components of Net Benefits Income
(Expense):
  Service cost                           $  (4,800)  $  (5,600)  $  (3,800)
  Interest cost                            (23,800)    (23,300)    (23,100)
  Expected return on plan assets            45,700      42,900      36,900 
  Curtailment losses                          (400)     (2,400)     (1,200)
  Special termination benefits                -        (16,000)       - 
  Amortization of unrecognized losses         -         (1,000)     (2,300)
  Net benefits income (expense) 
   for the year                          $  16,700   $  (5,400)  $   6,500 




<PAGE>46



                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Plan assets include Common Stock of the Company with a total market value of
$46.9 million as of February 28, 1998.  The special termination benefits of
$16.0 million in fiscal 1997 relate to the Company's restructuring plan, as
discussed in Note 2.

Information concerning the Company's other postretirement benefit plans
consists of the following (dollars in thousands):

                                          Other Postretirement Benefit Plans
                                          ----------------------------------
                                            1998        1997        1996
                                            ----        ----        ----
Change in Benefit Obligations:

  Benefit obligations at the
   beginning of the year                  $ (88,200)  $ (84,100)  $ (69,700)
  Acquisitions                                 -         (4,100)     (4,600)
  Service cost                                 (500)       (600)       (600)
  Interest cost                              (6,200)     (6,200)     (6,000)
  Curtailment gains                            -          2,900        -
  Change in the discount rate                (3,500)       -        (10,600)
  Other actuarial losses                     (7,300)     (5,100)     (1,000)
  Benefits paid                              10,100       9,000       8,400
  Benefit obligations at the
   end of the year                        $ (95,600)  $ (88,200)  $ (84,100)

Funded Status Reconciliation:

  Funded status                           $ (95,600)  $ (88,200)  $ (84,100)
  Unrecognized actuarial losses              29,300      18,300      13,800
  Unrecognized prior service costs             (900)       (300)       (300)
  Accrued liability recognized
   in the consolidated balance 
   sheet at the end of the year           $ (67,200)  $ (70,200)  $ (70,600)

Components of Net Benefits Expense:

  Service cost                            $    (500)  $    (600)  $    (600)
  Interest cost                              (6,200)     (6,200)     (6,000)
  Curtailment gains                            -          2,900        -
  Amortization of unrecognized losses          (600)       (100)       (100)
  Net benefits expense for the year       $  (7,300)  $  (4,000)  $  (6,700)

The weighted average actuarial assumptions utilized in determining the above
amounts for the defined benefit and other postretirement benefit plans as of
the end of the year were as follows:

   Expected return on plan assets            11.5%        11.5%        11.5%
   Discount rate                              7.0%         7.5%         7.5%
   Rate of compensation increase              4.0%         4.0%         4.0%



<PAGE>47

                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company's other postretirement benefit plans identified above provide
health and life insurance benefits to a number of existing retirees from
certain of its operations under the provisions of a number of different plans. 
Contributions currently required to be paid by the retirees towards the cost
of such plans range from zero to 100%.  The Company also has a number of
active employees who might receive such benefits upon their retirement. 
Relative to the above financial information, the actuarial valuations assume a
medical cost trend rate of 7% for fiscal 1999, decreasing by 1% per year to an
ultimate level of 4.5% in fiscal 2002.  In that regard, the impact of a 1%
change in the health care cost trend rate would change the benefit obligations
by $1.8 million and change the total service and interest cost components by
approximately $100,000.

The Company also has defined contribution pension plans for a significant
number of its employees in the United States, as well as for certain of its
employees outside of the United States.  The Company's contributions to these
plans are based on various percentages of compensation, and in some instances
are based upon the amount of the employees' contributions to the plans.  The
annual cost of these plans amounted to approximately $15.3 million, $16.9
million and $13.0 million in fiscal 1998, 1997 and 1996, respectively, the
substantial part of which was funded currently.

11.  Net Income Per Share

Following is a reconciliation of net income and weighted average common shares
outstanding for purposes of calculating basic and diluted net income per
share:

   Basic Net Income Per Share                  1998       1997      1996
   --------------------------                  ----       ----      ----

   Net income                                $ 98,600   $56,100    $92,400
   Weighted average 
    common shares outstanding                  64,100    66,300     66,200
   Basic net income per share                $   1.54   $   .84    $  1.40
 
   Diluted Net Income Per Share               
   ----------------------------
   Net income                                $ 98,600   $56,100    $92,400

   After-tax equivalent of interest
    expense on 4-3/4% convertible 
    subordinated notes                          2,700      -          -   
   Income for purposes of computing 
    diluted net income per share             $101,300   $56,100    $92,400

   Weighted average common 
    shares outstanding                         64,100    66,300     66,200
   Dilutive stock options                         500       400        400
   Weighted average assumed conversion of
    4-3/4% convertible subordinated notes       2,800      -          -   

   Weighted average common shares
    outstanding for purposes of computing 
    diluted net income per share               67,400    66,700     66,600

   Diluted net income per share              $   1.50   $   .84    $  1.39


<PAGE>48

                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



12.  Stockholders' Equity and Stock Options

The Company has a Shareholders' Rights Plan under which Rights were
distributed as a dividend at a rate of one Right for each share of Common
Stock held.  Each Right entitles the holder to buy one one-hundredth of a
newly-issued share of the Company's Series A Junior Participating Preferred
Stock at an exercise price of $80.00 per share.  If an acquiring person
beneficially owns 20% or more of the Company's Common Stock or the Company is
a party to a business combination which is not approved by the Company's Board
of Directors, each Right (other than those held by the acquiring person) will
entitle the holder to receive, upon exercise, shares of Common Stock of the
Company or of the surviving company with a value equal to two times the
exercise price of the Right.  

In March 1997, the Company announced its intention to acquire up to 7.3
million shares of its Common Stock outstanding.  It is expected that such
shares would be purchased in the open-market, or through privately negotiated
transactions, at prices which the Company considers to be attractive.  Through
February 28, 1998, the Company had acquired and retired approximately 3.5
million of such shares, at an average cost of $23.14 per share, or a total
cost of approximately $80.4 million.  The Company is also authorized to issue
10 million shares of Preferred Stock, and there are no shares outstanding at
the present time.  

Under the Company's Restricted Stock Plan, there are approximately 346,000
restricted shares outstanding under various awards as of February 28, 1998. 
Approximately 276,000 shares remain available for issuance under the Plan as
of that date.  The fair market value of restricted stock awards as of the date
of grant is recognized as it is earned over the restriction period (normally 5
years), with approximately $1.3 million recognized as expense in each of
fiscal 1998, 1997 and 1996.  

The Company's qualified Incentive Stock Option Plans provide for granting
options to key employees to allow them to purchase the Company's Common Stock
at an exercise price equal to 100% of the market price on the date of grant. 
The options may be exercised in cumulative annual increments of 25% commencing
one year after the date of grant, and have a maximum duration of ten years. 
There were approximately 3.2 million and 3.5 million shares reserved for the
future granting of options as of February 28, 1998 and 1997, respectively.  
                                       


<PAGE>49


                                   MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



The following table summarizes the status of all of the Company's stock option
transactions for fiscal 1998, 1997 and 1996 (share amounts in thousands):
  
                            1998               1997                1996       
                      ------------------  -----------------   ---------------

                                Weighted           Weighted           Weighted
                                Average            Average            Average
                      Option    Option    Option   Option     Option  Option
                      Shares     Price    Shares    Price     Shares   Price 
                      ------     -----    ------   ------     ------   -----
Balance at 
 beginning
 of year               1,421      $15.11    1,841   $14.08     1,500   $11.90
Activity during                           
 the year:              
  Granted                357      $22.26      -        -         712   $17.02
  Exercised             (136)     $12.89     (410)  $10.45      (338)  $10.68
  Canceled                (4)     $16.62      (10)  $16.15       (33)  $13.35
Balance at                                
 end of year:      
  Outstanding          1,638      $16.85    1,421   $15.11     1,841   $14.08
  Exercisable            850      $14.80      684   $13.60       649   $10.13

At February 28, 1998, approximately 660,000 of the options outstanding have a
weighted average remaining life of approximately 6 years, and are exercisable
at prices ranging primarily from $10.25 to $16.75 per share.  The remaining
978,000 options outstanding have a weighted average remaining life of
approximately 8 years and are exercisable at prices ranging from $16.25 to
$22.25 per share.  The 357,000 and 712,000 options granted during fiscal 1998
and 1996, respectively, had a weighted average fair value of approximately
$11.00 per share for Corporate Officers and $6.00 per share for other
employees.  For purposes of estimating such fair value, the Company utilized
the Black-Scholes option pricing model, and the following valuation
assumptions:
                                                                           
                          Options Granted to          Options Granted to  
                         Corporate Officers             Other Employees
                         -------------------          -------------------
                          1998         1996           1998           1996   
                          ----         ----           ----           ----
Pricing 
 volatility factor      30.5%         33.3%          24.0%           26.7%
Option 
 expiration term      10 years       10 years       4 years         4 years
Risk-free interest
 rate range          6.3% to 6.9%  5.9% to 6.9%    6.6% to 6.9%   5.5% to 6.9%
Annual dividend
 yield                   .7%           .6%             .7%            .6%


<PAGE>50


                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company applies APB Opinion No. 25 in accounting for its stock options
and, accordingly, no compensation cost has been recognized for stock options
in the accompanying consolidated financial statements.  If the Company had
recognized compensation expense for the options based upon the values
identified above, earnings for fiscal 1998, 1997 and 1996 would have changed
as follows (amounts in thousands, except per share data):

                                             Pro Forma Earnings (Unaudited)
                                             ------------------------------
                                              1998        1997       1996
                                              ----        ----       ----
Net income, as reported                     $ 98,600    $ 56,100   $ 92,400
Compensation expense related 
 to options granted                           (2,200)     (1,300)      (600)
Tax benefit of compensation expense              800         500        200
  Net income, as adjusted                   $ 97,200    $ 55,300   $ 92,000

Basic net income per share, as reported     $   1.54    $    .84   $   1.40
Basic net income per share, as adjusted     $   1.52    $    .83   $   1.39

Diluted net income per share, as reported   $   1.50    $    .84   $   1.39
Diluted net income per share, as adjusted   $   1.48    $    .83   $   1.38

13.  Industry Segments and Geographic Areas 

The Company classifies its operations into the following two business
segments:

       (i)   Automotive, which includes the design, manufacture and
             distribution of (a) power transmission, fuel and fluid handling
             systems and components, and (b) filters and filtration systems,
             for the global automotive aftermarket and OEM (original equipment
             manufacturers) market; and
       (ii)  Industrial, which includes the design, manufacture and
             distribution of power and fluid management systems and components
             for industrial OEM and distribution markets worldwide.

Information concerning the Company's business segments for fiscal 1998, 1997
and 1996 is as follows (dollars in thousands):

                                              1998        1997        1996     
NET SALES TO CUSTOMERS                        ----        ----        ----
 Automotive                                $1,209,700  $1,111,700  $1,004,300
 Industrial                                 1,000,500     964,300     774,900
   Total related to                                     
    continuing operations                  $2,210,200  $2,076,000  $1,779,200
                                                         
OPERATING INCOME                                         
 Automotive                                $  132,700  $  122,100  $  110,600
 Industrial                                   121,400     120,500      95,100
 Restructuring charge                            -       (112,500)       -   
   Total operating income                     254,100     130,100     205,700
 General corporate expense                    (15,800)    (19,400)    (17,400)
 Interest expense                             (61,600)    (59,000)    (52,600)
   Income from continuing                              
    operations before 
    provision for taxes                    $  176,700  $   51,700  $  135,700


<PAGE>51

                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                              1998        1997        1996
                                              ----        ----        ----
IDENTIFIABLE ASSETS                       
 Automotive                                $1,377,700  $1,107,900  $1,030,000
 Industrial                                   896,800     833,900     684,100
 General corporate                            146,000      32,800      29,600
   Total related to                                    
    continuing operations                   2,420,500   1,974,600   1,743,700
 Discontinued operations                         -           -        269,400
   Total identifiable assets               $2,420,500  $1,974,600  $2,013,100

DEPRECIATION AND AMORTIZATION                            
 Automotive                                $   47,200  $   38,900  $   33,100
 Industrial                                    29,000      26,400      22,500
 General corporate                              3,700       3,700       3,600
   Total related to                                    
    continuing operations                  $   79,900  $   69,000  $   59,200

CAPITAL OUTLAYS                                          
 Automotive                                $   92,600  $   68,300  $   57,600
 Industrial                                    63,900      40,900      32,900
   Total related to
    continuing operations                  $  156,500  $  109,200  $   90,500 

The Company's operations outside of the United States are located primarily in
Europe, and to a lesser extent in Canada, Latin America and the Far East. 
Information concerning the Company's operations by geographic area for fiscal
1998, 1997 and 1996 is as follows (dollars in thousands):
                                                  
                                             1998         1997         1996  
NET SALES FROM                               ----         ----         ----
 CONTINUING OPERATIONS
  United States                           $1,571,900   $1,496,400   $1,271,300
  International                              638,300      579,600      507,900
    Total related to 
     continuing operations                $2,210,200   $2,076,000   $1,779,200

OPERATING INCOME FROM                            
 CONTINUING OPERATIONS
  United States                           $  174,100   $  166,400   $  138,200
  International                               80,000       76,200       67,500
  Restructuring charge                          -        (112,500)        -   
    Total related to
     continuing operations                $  254,100   $  130,100   $  205,700
                                                
IDENTIFIABLE ASSETS                             
  United States                           $1,697,700   $1,438,600   $1,259,800
  International                              722,800      536,000      483,900
    Total related to
     continuing operations                 2,420,500    1,974,600    1,743,700
  Discontinued operations                       -            -         269,400
    Total identifiable assets             $2,420,500   $1,974,600   $2,013,100


 <PAGE>52

                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


The net sales to customers reflect the sales of the continuing operating units
in each geographic area to unaffiliated customers.  Export sales of continuing
operating units from the United States to unaffiliated customers were $97.1
million, $95.4 million, and $91.6 million in fiscal 1998, 1997 and 1996,
respectively.  Inter-segment sales are not material.  Sales between geographic
areas are accounted for at prices which are competitive with prices charged to
unaffiliated customers.

14.  Legal and Environmental Matters

One of the Company's subsidiaries has been named as a defendant in a number of
litigation actions related to product supplied to one of the subsidiary's
customers.  The parties seek damages related to alleged defects in certain
hose products manufactured by the subsidiary and included by the customer in
its retail gasoline fuel delivery systems.  The Company believes it has good
and valid defenses against the claims, and has submitted a counter-claim
against the customer.  

The Company is also involved in various other legal and environmental-related
issues.  The Company believes that it has adequately provided for costs to be
expended in the future relative to its existing environmental related
obligations, the reserves for which have not been discounted to their present
value.  In the opinion of the Company's management, the ultimate cost to
resolve these matters will not have a material adverse effect on the Company's
financial position, results of operations or cash flows.



<PAGE>53

        
                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


15.    Quarterly Financial Data and Information (Unaudited)

The following table sets forth the Company's unaudited results of operations
for each of the fiscal quarters in the years ended February 28, 1998 and 1997 
(amounts in thousands, except per share data):

                           First     Second     Third     Fourth      Total
                          Quarter    Quarter   Quarter    Quarter     Year 
                          -------    -------   -------    -------     -----
Fiscal 1998
-----------
Continuing operations:
 Net sales               $560,100   $531,100   $564,100  $554,900  $2,210,200

 Gross profit (a)        $183,300   $173,500   $182,500  $173,900  $  713,200

 Operating income        $ 63,600   $ 60,500   $ 60,800  $ 53,400  $  238,300
 Interest expense         (14,300)   (15,600)   (16,800)  (14,900)    (61,600)
 Provision for taxes      (19,200)   (17,400)   (16,700)  (14,200)    (67,500)
    Total continuing       30,100     27,500     27,300    24,300     109,200
 Extraordinary loss          -          -       (10,600)     -        (10,600)
    Net income           $ 30,100   $ 27,500   $ 16,700  $ 24,300  $   98,600

Basic earnings 
 per share:
  Continuing operations  $    .46   $    .43   $    .43  $    .38  $     1.70
  Extraordinary loss          -          -         (.16)      -          (.16)
    Net income           $    .46   $    .43   $    .27  $    .38  $     1.54

Diluted earnings
 per share: (b)
  Continuing operations  $    .46   $    .43   $    .42  $    .36  $     1.66
  Extraordinary loss          -          -         (.16)      -          (.16)
    Net income           $    .46   $    .43   $    .26  $    .36  $     1.50

Fiscal 1997
-----------
Continuing operations:
 Net sales               $540,900   $494,300   $521,600  $519,200  $2,076,000

 Gross profit (a)        $175,800   $161,100   $170,400  $160,600  $  667,900

 Operating income before
  restructuring charge   $ 59,700   $ 55,100   $ 55,800  $ 52,600  $  223,200
 Restructuring charge        -          -      (112,500)     -       (112,500)
  Operating income (loss)  59,700     55,100    (56,700)   52,600     110,700

 Interest expense         (14,900)   (15,400)   (14,500)  (14,200)    (59,000)
 Provision for taxes      (17,500)   (15,500)    28,900   (14,900)    (19,000)
    Total continuing       27,300     24,200    (42,300)   23,500      32,700
Discontinued operations     1,200      2,600     13,600     6,000      23,400
    Net income (loss)    $ 28,500   $ 26,800   $(28,700) $ 29,500  $   56,100



<PAGE>54
                           MARK IV INDUSTRIES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



                           First     Second     Third     Fourth      Total
                          Quarter    Quarter   Quarter    Quarter     Year 
                          -------    -------   -------    -------     -----
Fiscal 1997
-----------
Basic earnings
 per share:
 Continuing operations:
  Before restructuring 
   charge                $    .41    $   .37   $    .38  $    .35   $   1.51
  Restructuring charge        -          -        (1.02)      -        (1.02)
    Total continuing          .41        .37       (.64)      .35        .49
 Discontinued operations      .02        .04        .20       .09        .35
    Net income (loss)    $    .43    $   .41   $   (.44) $    .44   $    .84

Diluted earnings
 per share:
 Continuing operations:
  Before restructuring 
   charge                $    .41    $   .36   $    .38  $    .35   $   1.50
  Restructuring charge        -          -        (1.01)      -        (1.01)
    Total continuing          .41        .36       (.63)      .35        .49
 Discontinued operations      .02        .04        .20       .09        .35
    Net income (loss)    $    .43    $   .40   $   (.43) $    .44   $    .84

___________________________________

(a)  Excludes depreciation expense.
(b)  The sum of quarterly amounts do not equal the fiscal year amount due to   
     the weighted effect of stock repurchases during the year.



<PAGE>55


ITEM 9.  DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
-------  ----------------------------------------------------
       None.

                                   PART III 

Items 10-13
----------- 
       The information required for Items 10, 11, 12 and 13 is incorporated
herein by reference to the information set forth in the definitive Proxy
Statement for the Company's 1998 Annual Meeting of Stockholders which will be
filed with the Securities and Exchange Commission not later than 120 days
after February 28, 1998.


                                    PART IV


ITEM 14.EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
-------- ---------------------------------------------------------------
                                                                         Page
(a)  (1)  Financial Statements                                           ----
          --------------------
          Report of Independent Accountants for 
           each of the three fiscal years in the 
           period ended February 28, 1998                                  31
  
         Consolidated Balance Sheets at February 28, 1998
          and 1997                                                         32

         Consolidated Statements of Income for each of 
          the three fiscal years in the period ended 
          February 28, 1998                                                33

         Consolidated Statements of Stockholders' Equity for
          each of the three fiscal years in the period
          ended February 28, 1998                                          34

         Consolidated Statements of Cash Flows 
          for each of the three fiscal years in 
          the period ended February 28, 1998                               35

         Notes to Consolidated Financial Statements                        36

     (2)  Financial Statement Schedule 
          -----------------------------
         Report of Independent Accountants 
          for each of the three fiscal years in the 
          period ended February 28, 1998                                   60

     II.  Valuation and Qualifying Accounts                                61

          All other schedules and statements have been omitted as the required
          information is inapplicable or is presented in the financial
          statements or notes thereto. 


<PAGE>56


(b)  Reports on Form 8-K
     -------------------
     None

(c)  Exhibits 
     --------

     2.1     Agreement and Plan of Merger dated as of October 3, 1994 by and
             among Mark IV Industries, Inc., Mark IV Acquisition Corp., and
             Purolator Products Company, incorporated by reference to exhibit
             (c)(1) to Schedule 14D-1 (Tender Offer) dated October 7, 1994,
             as filed with the SEC on such date (incorporated by reference to
             the exhibit (c)(1) to Schedule 14D-1 (Tender Offer) dated
             October 7, 1994, as filed with the SEC on such date).
 
     2.2     Offer to Purchase by and among Mark IV Industries, Inc., Mark IV
             Acquisition corp., and Purolator Products Company, as revised,
             incorporated by reference to exhibit (a)(1) to Amendment No. 1
             to Schedule 14D-1 (Tender Offer) dated October 11, 1994, as
             filed with the SEC on such date.

     3.1     Certificate of Incorporation, as amended (incorporated by
             reference to Exhibit 28.1 to the Company's Registration
             Statement No. 33-45215 on Form S-3, as filed with the SEC on
             January 24, 1993).

     4.1     Specimen Common Stock Certificate (incorporated by reference to
             Exhibit 4.1 to the Company's Quarterly Report on Form 10-Q dated
             July 1, 1997).

     4.2     By-Laws of the Registrant (incorporated by reference to Exhibit
             4.12 To Amendment No. 1 to the Registrant's Registration
             Statement No. 33-41553 on Form S-3, dated August 6, 1991).

     4.3     Conformed copy of the Indenture, dated as of March 15, 1993,
             between Mark IV Industries, Inc. and Citibank, N.A.; including
             the form of Senior Subordinated Notes due April 1, 2003
             (incorporated by reference to Exhibit 4.1 to the Company's
             Current Report on Form 8-K dated March 29, 1993). 

     4.4     Conformed copy of the Indenture, dated as of March 11, 1996,
             between Mark IV Industries, Inc. and Fleet National Bank as
             Trustee; including the form of Senior Subordinated Notes due
             April 1, 2006 (incorporated by reference to Exhibit 4.1 to the
             Company's Current Report on Form 8-K dated March 6, 1996). 

     4.5     Conformed copy of the Indenture, dated as of August 11, 1997,
             between Mark IV Industries, Inc, as issuer and Marine Midland
             Bank, as trustee; including the form of Senior Subordinated
             Notes due September 1, 2007 (incorporated by reference to
             Exhibit 4.1 to the Company's Current Report on Form 8-K dated
             August 25, 1997). 

     4.6     Conformed copy of the Indenture, dated as of October 29, 1997,
             between Mark IV Industries, Inc., as issuer and The Bank of New
             York, as trustee; including the form of Convertible Subordinated
             Notes due November 1, 2004 (incorporated by reference to Exhibit
             4.1 to the Company's Current Report on Form 8-K dated November
             6, 1997). 

<PAGE>57

          Executive Compensation Plans and Arrangements (10.1 -10.21)
          ----------------------------------------------------------

     10.1    Employment Agreement dated March 1, 1995 between the Company and
             Sal Alfiero (incorporated by reference to Exhibit 10.1 to the
             Company's Annual Report or Form 10-K for the fiscal year ended
             February 28, 1995).

     10.2    Employment Agreement dated March 1, 1995 between the Company and
             Gerald S. Lippes (incorporated by reference to Exhibit 10.3 to
             the Company's Annual Report or Form 10-K for the fiscal year
             ended February 28, 1995).

     10.3    Employment Agreement dated March 1, 1995 between the Company and
             William P. Montague (incorporated by reference to Exhibit 10.4
             to the Company's Annual Report or Form 10-K for the fiscal year
             ended February 28, 1995).

     10.4    Employment Agreement dated March 1, 1995 between the Company and
             Frederic L. Cook (incorporated by reference to Exhibit 10.5 to
             the Company's Annual Report or Form 10-K for the fiscal year
             ended February 28, 1995).

     10.5    Employment Agreement dated March 1, 1995 between the Company and
             John J. Byrne (incorporated by reference to Exhibit 10.6 to the
             Company's Annual Report or Form 10-K for the fiscal year ended
             February 28, 1995).

     10.6    Employment Agreement dated March 1, 1995 between the Company and
             Richard L. Grenolds (incorporated by reference to Exhibit 10.7
             to the Company's Annual Report or Form 10-K for the fiscal year
             ended February 28, 1995).

     10.7    Employment Agreement dated March 1, 1995 between the Company and
             Douglas J. Fiegel (incorporated by reference to Exhibit 10.8 to
             the Company's Annual Report or Form 10-K for the fiscal year
             ended February 28, 1995).

     10.8    Employment Agreement dated January 1, 1995 between the Company,
             Dayco Products, Inc. ("Dayco") and Bruce A. McNiel (incorporated
             by reference to Exhibit 10.9 to the Company's Annual Report or
             Form 10-K for the fiscal year ended February 28, 1995).

     10.9    Employment Agreement dated January 1, 1995 between the Company,
             Dayco, Dayco Europe, A.B. and Kurt J. Johansson (incorporated by
             reference to Exhibit 10.10 to the Company's Annual Report or
             Form 10-K for the fiscal year ended February 28, 1995).

     10.10   Employment Agreement dated January 1, 1995 between the Company,
             Dayco and Patricia Richert (incorporated by reference to Exhibit
             10.11 to the Company's Annual Report or Form 10-K for the fiscal
             year ended February 28, 1995).

     10.11   Amendment and Restatement of Mark IV Industries, Inc. and
             Subsidiaries Incentive Stock Option Plan, as of February 8, 1988
             (incorporated by reference to Exhibit 10.13.1 to the Company's
             Registration Statement No. 33-42307 on Form S-8 dated August 19,
             1991).


<PAGE>58

     10.12   Amendment and Restatement of the Mark IV Industries, Inc. and
             Subsidiaries 1992 Incentive Stock Option Plan Effective March
             30, 1994 (incorporated by reference to Exhibit 10.4 to the
             Company's Annual Report on Form 10-K for the fiscal year ended
             February 28, 1994).

     10.13*  Mark IV Industries, Inc. and Subsidiaries 1996 Incentive Stock
             Option Plan effective April 24, 1996. 

     10.14   Amendment and Restatement of the Mark IV Industries, Inc. 1992
             Restricted Stock Plan Effective March 1, 1995 (incorporated by
             reference to Exhibit 10.1 to the Company's Annual Report or Form
             10-K for the fiscal year ended February 28, 1995).
 
     10.15*  Amendment and Restatement of the Mark IV Industries, Inc.
             Executive Bonus Plan effective March 1, 1995.

     10.16   First Amendment and Restatement of the Mark IV Industries, Inc.
             Enhanced Executive Incentive Plan (incorporated by reference to
             Exhibit 10.16 to the Company's Annual Report on Form 10-K dated
             February 29, 1992).

     10.17   Third Amendment and Restatement of the Non-Qualified Plan of
             Deferred Compensation of Mark IV Industries, Inc. Effective
             September 1, 1993 (incorporated by reference to the Company's
             Annual Report on Form 10-K for the fiscal year ended February
             28, 1994).

     10.18   First Amendment and Restatement of the Non-Qualified Plan of
             Deferred Compensation for Non-Employee Directors of Mark IV
             Industries, Inc. Effective December 1, 1993 (incorporated by
             reference to the Company's Annual Report on Form 10-K for the
             fiscal year ended February 28, 1994).

     10.19   First Amendment and Restatement of the Non-qualified Plan of
             Deferred Incentive Compensation for Executives of Certain
             Operating Divisions and Subsidiaries of Mark IV Industries, Inc.
             Effective November 30, 1993 (incorporated by reference to
             Exhibit 10.19 to the Company's Annual Report or Form 10-K for
             the fiscal year ended February 28, 1995).

     10.20   Short Term Incentive Bonus Plan of Dayco Products, Inc. dated
             March 30, 1994 (incorporated by reference to Exhibit 10.20 to
             the Company's Annual Report or Form 10-K for the fiscal year
             ended February 28, 1995).

     10.21   Executive Loan Program (Incorporated by reference to Exhibit
             10.20 to the Company's Annual Report on Form 10-K for the Fiscal
             year ended February 28, 1997).


<PAGE>59



                        Other Material Contract Exhibits


     10.22   Conformed copy of the Credit Agreement, dated as of March 8,
             1996, among the Registrant and Dayco PTI S.p.A., as Borrowers,
             certain other subsidiaries of the Registrant, as Guarantors,
             various banks and financial institutions, Chemical Bank, as
             Administrator and Bid Agent, Bank of America National Trust and
             Savings Association, as Documentation Agent, and BA Securities,
             Inc. and Chemical Securities, Inc. as Arrangers (incorporated by
             reference to Exhibit 10.1 to the Registrant's Current Report on
             Form 8-K dated March 6, 1996).

     21*     Subsidiaries of the Registrant.

     23*     Consent of Independent Accountants.

     27*     Financial Data Schedule.

______________________

*  Filed herewith by direct transmission pursuant to the EDGAR program.



<PAGE>60







                      REPORT OF INDEPENDENT ACCOUNTANTS 
                      ---------------------------------


 

 
To the Board of Directors and Stockholders 
 of Mark IV Industries, Inc. 
 
 
Our report on the consolidated financial statements of Mark IV Industries,
Inc. and Subsidiaries as of February 28, 1998 and 1997 and for each of the
three fiscal years in the period ended February 28, 1998, is included in Item
8 of this Form 10-K.  In connection with our audits of such financial
statements, we have also audited the related financial statement schedule
listed in Item 14 of this Form 10-K. 
 
In our opinion, the financial statement schedule referred to above, when
considered in relation to the basic consolidated financial statements taken as
a whole, presents fairly, in all material respects, the information required
to be included therein.  
 
 
 
                                       COOPERS & LYBRAND L.L.P.
 
 
 
 
 
 
Rochester, New York 
March 18, 1998


<PAGE>61

<TABLE>
<CAPTION>

                                            MARK IV INDUSTRIES, INC.
                                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

                                              Additions
                                               Charged       Deductions
                                Beginning     (Credited)      Accounts                          Ending
Classifications                  Balance      to Expense     Charged Off         Other(a)       Balance

    <S>                             <C>          <C>            <C>                  <C>           <C>
 
Year ended February 28, 1998
---------------------------- 
Allowance for doubtful 
 accounts                      $ 14,700,000   $  3,300,000    $ (4,400,000)   $    -          $ 13,600,000


 
Year ended February 28, 1997
----------------------------
Allowance for doubtful
 accounts                      $ 16,700,000   $  4,800,000    $ (4,700,000)   $ (2,100,000)   $ 14,700,000


Year ended February 29, 1996
---------------------------- 
Allowance for doubtful
 accounts                      $ 18,600,000   $  2,700,000    $ (5,400,000)   $    800,000    $ 16,700,000


</TABLE>

<TABLE>
<CAPTION>



(a)  Represents the following
                                                                 February       February         February       
                                                                 28, 1998       28, 1997         28, 1996
                                                                 --------       --------         --------

                            <S>                                    <C>            <C>              <C>

          Reserve at date of acquisition of subsidiary         $   200,000     $   500,000      $  100,000
                                                            
          Reclassification from other reserves                        -            200,000         200,000      
          Reserves of discontinued operations disposed                -         (2,400,000)           -   
          Foreign currency translation adjustment                 (200,000)       (400,000)        500,000
                                                               $      -        $(2,100,000      $  800,000

 
</TABLE>


<PAGE>62


                                  SIGNATURES


     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized. 
 
                                      MARK IV INDUSTRIES, INC.



                                      By: /s/ Sal H. Alfiero             
                                          ------------------
                                          Sal H. Alfiero, Chairman of the
                                          Board and Chief Executive Officer
Dated:  May 28, 1998     
        ------------

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
Annual Report on Form 10-K has been signed below by the following persons in
the capacities and on the date indicated. 

 
     Signature                             Title                     Date

 
/s/ Sal H. Alfiero                  Chairman of the Board        May 28, 1998
-------------------------            and Chief Executive Officer ------------
    Sal H. Alfiero                   


 
/s/ William P. Montague             President, Director          May 28, 1998
-------------------------                                        ------------
    William P. Montague


 
/s/ John J. Byrne                   Vice President and           May 28, 1998
-------------------------            Chief Financial Officer     ------------
    John J. Byrne                    


 
/s/ Richard L. Grenolds             Vice President and           May 28, 1998
-------------------------            Chief Accounting Officer    ------------
    Richard L. Grenolds              



/s/ Gerald S. Lippes                Secretary and Director       May 28, 1998
-------------------------                                        ------------
    Gerald S. Lippes 


 
/s/ Clement R. Arrison              Director                     May 28, 1998
-------------------------                                        ------------
    Clement R. Arrison



<PAGE>63

  

                                   Exhibit Index
                                   -------------


     2.1     Agreement and Plan of Merger dated as of October 3, 1994 by and
             among Mark IV Industries, Inc., Mark IV Acquisition Corp., and
             Purolator Products Company, incorporated by reference to exhibit
             (c)(1) to Schedule 14D-1 (Tender Offer) dated October 7, 1994,
             as filed with the SEC on such date (incorporated by reference to
             the exhibit (c)(1) to Schedule 14D-1 (Tender Offer) dated
             October 7, 1994, as filed with the SEC on such date).
 
     2.2     Offer to Purchase by and among Mark IV Industries, Inc., Mark IV
             Acquisition corp., and Purolator Products Company, as revised,
             incorporated by reference to exhibit (a)(1) to Amendment No. 1
             to Schedule 14D-1 (Tender Offer) dated October 11, 1994, as
             filed with the SEC on such date.

     3.1     Certificate of Incorporation, as amended (incorporated by
             reference to Exhibit 28.1 to the Company's Registration
             Statement No. 33-45215 on Form S-3, as filed with the SEC on
             January 24, 1993).

     4.1     Specimen Common Stock Certificate (incorporated by reference to
             Exhibit 4.1 to the Company's Quarterly Report on Form 10-Q dated
             July 1, 1997).

     4.2     By-Laws of the Registrant (incorporated by reference to Exhibit
             4.12 To Amendment No. 1 to the Registrant's Registration
             Statement No. 33-41553 on Form S-3, dated August 6, 1991).

     4.3     Conformed copy of the Indenture, dated as of March 15, 1993,
             between Mark IV Industries, Inc. and Citibank, N.A.; including
             the form of Senior Subordinated Notes due April 1, 2003
             (incorporated by reference to Exhibit 4.1 to the Company's
             Current Report on Form 8-K dated March 29, 1993). 

     4.4     Conformed copy of the Indenture, dated as of March 11, 1996,
             between Mark IV Industries, Inc. and Fleet National Bank as
             Trustee; including the form of Senior Subordinated Notes due
             April 1, 2006 (incorporated by reference to Exhibit 4.1 to the
             Company's Current Report on Form 8-K dated March 6, 1996). 

     4.5     Conformed copy of the Indenture, dated as of August 11, 1997,
             between Mark IV Industries, Inc, as issuer and Marine Midland
             Bank, as trustee; including the form of Senior Subordinated
             Notes due September 1, 2007 (incorporated by reference to
             Exhibit 4.1 to the Company's Current Report on Form 8-K dated
             August 25, 1997). 

     4.6     Conformed copy of the Indenture, dated as of October 29, 1997,
             between Mark IV Industries, Inc., as issuer and The Bank of New
             York, as trustee; including the form of Convertible Subordinated
             Notes due November 1, 2004 (incorporated by reference to Exhibit
             4.1 to the Company's Current Report on Form 8-K dated November
             6, 1997). 


<PAGE>64



          Executive Compensation Plans and Arrangements (10.1 -10.21)
          ----------------------------------------------------------

     10.1    Employment Agreement dated March 1, 1995 between the Company and
             Sal Alfiero (incorporated by reference to Exhibit 10.1 to the
             Company's Annual Report or Form 10-K for the fiscal year ended
             February 28, 1995).

     10.2    Employment Agreement dated March 1, 1995 between the Company and
             Gerald S. Lippes (incorporated by reference to Exhibit 10.3 to
             the Company's Annual Report or Form 10-K for the fiscal year
             ended February 28, 1995).

     10.3    Employment Agreement dated March 1, 1995 between the Company and
             William P. Montague (incorporated by reference to Exhibit 10.4
             to the Company's Annual Report or Form 10-K for the fiscal year
             ended February 28, 1995).

     10.4    Employment Agreement dated March 1, 1995 between the Company and
             Frederic L. Cook (incorporated by reference to Exhibit 10.5 to
             the Company's Annual Report or Form 10-K for the fiscal year
             ended February 28, 1995).

     10.5    Employment Agreement dated March 1, 1995 between the Company and
             John J. Byrne (incorporated by reference to Exhibit 10.6 to the
             Company's Annual Report or Form 10-K for the fiscal year ended
             February 28, 1995).

     10.6    Employment Agreement dated March 1, 1995 between the Company and
             Richard L. Grenolds (incorporated by reference to Exhibit 10.7
             to the Company's Annual Report or Form 10-K for the fiscal year
             ended February 28, 1995).

     10.7    Employment Agreement dated March 1, 1995 between the Company and
             Douglas J. Fiegel (incorporated by reference to Exhibit 10.8 to
             the Company's Annual Report or Form 10-K for the fiscal year
             ended February 28, 1995).

     10.8    Employment Agreement dated January 1, 1995 between the Company,
             Dayco Products, Inc. ("Dayco") and Bruce A. McNiel (incorporated
             by reference to Exhibit 10.9 to the Company's Annual Report or
             Form 10-K for the fiscal year ended February 28, 1995).

     10.9    Employment Agreement dated January 1, 1995 between the Company,
             Dayco, Dayco Europe, A.B. and Kurt J. Johansson (incorporated by
             reference to Exhibit 10.10 to the Company's Annual Report or
             Form 10-K for the fiscal year ended February 28, 1995).

     10.10   Employment Agreement dated January 1, 1995 between the Company,
             Dayco and Patricia Richert (incorporated by reference to Exhibit
             10.11 to the Company's Annual Report or Form 10-K for the fiscal
             year ended February 28, 1995).

     10.11   Amendment and Restatement of Mark IV Industries, Inc. and
             Subsidiaries Incentive Stock Option Plan, as of February 8, 1988
             (incorporated by reference to Exhibit 10.13.1 to the Company's
             Registration Statement No. 33-42307 on Form S-8 dated August 19,
             1991).



<PAGE>65

     10.12   Amendment and Restatement of the Mark IV Industries, Inc. and
             Subsidiaries 1992 Incentive Stock Option Plan Effective March
             30, 1994 (incorporated by reference to Exhibit 10.4 to the
             Company's Annual Report on Form 10-K for the fiscal year ended
             February 28, 1994).

     10.13*  Mark IV Industries, Inc. and Subsidiaries 1996 Incentive Stock
             Option Plan effective April 24, 1996. 

     10.14   Amendment and Restatement of the Mark IV Industries, Inc. 1992
             Restricted Stock Plan Effective March 1, 1995 (incorporated by
             reference to Exhibit 10.1 to the Company's Annual Report or Form
             10-K for the fiscal year ended February 28, 1995).
 
     10.15*  Amendment and Restatement of the Mark IV Industries, Inc.
             Executive Bonus Plan effective March 1, 1995.

     10.16   First Amendment and Restatement of the Mark IV Industries, Inc.
             Enhanced Executive Incentive Plan (incorporated by reference to
             Exhibit 10.16 to the Company's Annual Report on Form 10-K dated
             February 29, 1992).

     10.17   Third Amendment and Restatement of the Non-Qualified Plan of
             Deferred Compensation of Mark IV Industries, Inc. Effective
             September 1, 1993 (incorporated by reference to the Company's
             Annual Report on Form 10-K for the fiscal year ended February
             28, 1994).

     10.18   First Amendment and Restatement of the Non-Qualified Plan of
             Deferred Compensation for Non-Employee Directors of Mark IV
             Industries, Inc. Effective December 1, 1993 (incorporated by
             reference to the Company's Annual Report on Form 10-K for the
             fiscal year ended February 28, 1994).

     10.19   First Amendment and Restatement of the Non-qualified Plan of
             Deferred Incentive Compensation for Executives of Certain
             Operating Divisions and Subsidiaries of Mark IV Industries, Inc.
             Effective November 30, 1993 (incorporated by reference to
             Exhibit 10.19 to the Company's Annual Report or Form 10-K for
             the fiscal year ended February 28, 1995).

     10.20   Short Term Incentive Bonus Plan of Dayco Products, Inc. dated
             March 30, 1994 (incorporated by reference to Exhibit 10.20 to
             the Company's Annual Report or Form 10-K for the fiscal year
             ended February 28, 1995).

     10.21   Executive Loan Program (Incorporated by reference to Exhibit
             10.20 to the Company's Annual Report on Form 10-K for the Fiscal
             year ended February 28, 1997).



<PAGE>66




        
                       Other Material Contract Exhibits
                       --------------------------------

     10.22   Conformed copy of the Credit Agreement, dated as of March 8,
             1996, among the Registrant and Dayco PTI S.p.A., as Borrowers,
             certain other subsidiaries of the Registrant, as Guarantors,
             various banks and financial institutions, Chemical Bank, as
             Administrator and Bid Agent, Bank of America National Trust and
             Savings Association, as Documentation Agent, and BA Securities,
             Inc. and Chemical Securities, Inc. as Arrangers (incorporated by
             reference to Exhibit 10.1 to the Registrant's Current Report on
             Form 8-K dated March 6, 1996).

     21*     Subsidiaries of the Registrant.

     23*     Consent of Independent Accountants.

     27*     Financial Data Schedule.

______________________

*  Filed herewith by direct transmission pursuant to the EDGAR program.