Cendant Announces that Holders Retained Virtually all of its Zero-Coupon Convertible Debentures

Cendant Corporation (NYSE: CD) today announced that virtually all holders of its $1.0 billion outstanding Zero-Coupon Convertible Debentures due May 2021 have retained the debentures, as investors declined to exercise their rights to “put” the debentures to Cendant.

Cendant`s Chairman, President and CEO, Henry R. Silverman stated: “We believe the decision by virtually all the holders to retain the debentures is a result of the strength of Cendant’s business model and the potential for future stock appreciation. As we continue to execute our plan to achieve increased earnings, we expect that our investors will be rewarded by a multiple that is more closely aligned with the marketplace.”

Additionally, the Company confirmed the amended terms of the debentures that remain outstanding. Cendant will pay cash interest of 3% per annum beginning May 5, 2002 and continuing through May 4, 2003, as well as provide an additional option for these holders to require Cendant to repurchase the debentures at par on May 4, 2003.

As previously announced, the interest payments will be made on November 4, 2002 and May 5, 2003 to holders of record at the close of business on October 4, 2002 and April 4, 2003, respectively. The specific terms of the payments and the additional put option were set forth in a supplemental indenture filed with the Securities and Exchange Commission on Form 8-K. The Form 8-K also includes a summary of certain U.S. federal income tax consequences of the proposed amendments to the terms of the debentures.

The terms of Cendant`s other outstanding securities, including its Zero-Coupon Senior Convertible Contingent Debt Securities due February 2021, are unchanged.