The acquisition is expected to be immediately accretive to Cendant earnings and is expected to close in early 2001.

For the twelve months ended September 30, 2000 Fairfield recorded revenues of approximately $560 million, an 18% increase over the comparable twelve months ended September 30, 1999. Net earnings for the twelve months ended September 30, 2000 rose over 20% to approximately $64 million as compared with $53 million in the prior period.

Cendant Chairman, President and CEO, Henry R. Silverman stated: "Fairfield is known throughout the resort industry for its strong management and outstanding sales and marketing capabilities. This acquisition will enable Cendant to expand our timeshare product offerings to our customers: timeshare developers. We can now offer Fairfield's proven systems along with Cendant's own core competencies in vacation exchange, travel agency, consulting and technology to current and prospective affiliates within the vacation ownership industry."

Stephen P. Holmes, Chairman, Cendant Travel Division, said: "Since we purchased RCI in 1996, timeshare has been an important core element in our Travel Division. Expanding our presence in this fast-growing industry with one of the recognized leaders will position us to accelerate the Travel Division's growth."

Berk stated: "This acquisition combines Cendant's infra-structure and global network systems with Fairfield's core competencies of sales and marketing, resort management, and consumer financing. Together we have all the components necessary to drive significant growth in the vacation ownership industry."

The definitive agreement provides that if Cendant elects to use its common stock as merger consideration, within a range of Cendant stock prices, the number of Cendant common shares to be issued per share of Fairfield Communities common stock will be increased to maintain the value of the consideration to be paid at $15 per share. Furthermore, if Cendant's stock price increases prior to closing of the transaction, the value of the consideration to be paid to Fairfield Communities shareholders will increase, but shall not exceed $16 per share.