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FILED PURSUANT TO RULE 424(b)(3)
S.E.C. FILE NUMBER 333-23063
THIRD SUPPLEMENT TO PROSPECTUS
October 28, 1998
(TO PROSPECTUS DATED SEPTEMBER 18, 1997)
The Prospectus dated September 18, 1997, as supplemented through the date hereof
(the "Prospectus"), relating to the offer and sale, from time to time, by the
Selling Securityholders listed therein of up to $550,000,000 aggregate principal
amount of 3% Convertible Subordinated Notes Due February 15, 2002 (the "Notes")
of Cendant Corporation (the "Company") and up to 17,959,205 shares of common
stock, $.01 par value of the Company, issuable upon conversion of the Notes, is
hereby supplemented as follows:
We urge you to carefully read the "Risk Factor" section appearing on page S-7,
where we describe specific risks associated with the Notes.
The following entities are hereby named as Selling Securityholders as
contemplated on page 29 of the Prospectus:
PRINCIPAL AMOUNT NUMBER OF
OF NOTES COVERED SHARES COVERED
SELLING SECURITYHOLDER BY THIS PROSPECTUS BY THIS PROSPECTUS
________________________________ ____________________ ___________________
American Travellers Life
Insurance Co. $ 500,000 16,326
Convertible
c/o Conseco Capital Management
11825 N. Pennsylvania Street
Carmel, IN 46032
American Variable Insurance Growth- $ 12,000,000 391,836
c/o Capital Research & Management
Company
135 South State College Boulevard
Brea, CA 92821
Amerisure Companies/Michigan Mutual $ 1,375,000 44,897
Insurance Company
c/o Calamos Asset Management, Inc.
1111 E. Warrenville Road
Naperville, IL 60563
Amoco Corporation Master Trust for $ 1,860,000 60,734
Employee Pension Plans
c/o SSI Investment Management Inc.
357 N. Canon Drive
Beverly Hills, CA 90210
PRINCIPAL AMOUNT NUMBER OF
OF NOTES COVERED SHARES COVERED
SELLING SECURITYHOLDER BY THIS PROSPECTUS BY THIS PROSPECTUS
________________________________ ____________________ ___________________
Anchor Pathway Fund Growth -
Income $ 3,000,000 97,959
Series
c/o Capital Research & Management
Company
135 South State College Boulevard
Brea, CA 92821
Associated Electric & Gas Insurance $ 875,000 28,571
Services Limited
c/o Calamos Asset Management, Inc.
1111 E. Warrenville Road
Naperville, IL 60563
Beneficial Standard Life
Insurance Co. - $ 550,000 17,959
Convertible Fund
c/o Conseco Capital Management
11825 N. Pennsylvania Street
Carmel, IN 46032
BT Alex. Brown $ 425,000 13,877
130 Liberty Street, 24th Floor
New York, NY 10006
BT Holdings (New York) Inc. $ 9,000,000 293,877
130 Liberty Street, 24th Floor
New York, NY 10006
Charitable Sec. Fd. $ 1,527,000 49,861
c/o Key Asset Management, Inc.
127 Public Square, 10th Floor
Cleveland, OH 44114
City of Birmingham Retirement & Relief $ 1,400,000 45,714
System
c/o Calamos Asset Management, Inc.
1111 E. Warrenville Road
Naperville, IL 60563
Conseco Health Insurance Co.
- Convertible $ 500,000 16,326
c/o Conseco Capital Management
11825 N. Pennsylvania Street
Carmel, IN 46032
Credit Suiss First Boston Corporation $ 2,762,0001 90,187a
5 World Trade Center
New York, NY 10048
PRINCIPAL AMOUNT NUMBER OF
OF NOTES COVERED SHARES COVERED
SELLING SECURITYHOLDER BY THIS PROSPECTUS BY THIS PROSPECTUS
________________________________ ____________________ ___________________
Donaldson, Lufkin & Jenrette
Sec. Corp. $ 210,000 6,857
401 City Ave, Suite 210
Bala Cynwyd, PA 19520
Dorinco Reinsurance Company $ 1,000,000 32,653
c/o Calamos Asset Management, Inc.
1111 E. Warrenville Road
Naperville, IL 60563
EB Convertible Sec. Fd. $ 2,460,000 80,326
c/o Key Asset Management, Inc.
127 Public Square, 10th Floor
Cleveland, OH 44114
Endowments $ 800,000 26,122
c/o Capital Research & Management
Company
135 South State College Boulevard
Brea, CA 92821
Field Fdn of Illinois $ 50,000 1,632
c/o Key Asset Management, Inc.
127 Public Square, 10th Floor
Cleveland, OH 44114
Fundamental Investors, Inc. $ 7,900,000 257,959
c/o Capital Research & Management
Company
135 South State College Boulevard
Brea, CA 92821
GenCorp Fdn. $ 150,000 4,897
c/o Key Asset Management, Inc.
127 Public Square, 10th Floor
Cleveland, OH 44114
General Electric Mortgage Insurance $ 2,300,000 75,102
Company
c/o Key Asset Management, Inc.
127 Public Square, 10th Floor
Cleveland, OH 44114
General Electric Mortgage Insurance $ 3,500,000 114,285
Corporation
c/o Calamos Asset Management, Inc.
1111 E. Warrenville Road
Naperville, IL 60563
Genesee County Employees' Retirement $ 400,000 13,061
System
c/o Calamos Asset Management, Inc.
1111 E. Warrenville Road
Naperville, IL 60563
Goldman, Sachs & Co. $ 25,565,000a 834,775a
10 Hanover Sq., 12th Floor
New York, NY 10005
Great American Reserve Insurance Co. $ 500,000 16,326
Convertible Fund
c/o Conseco Capital Management
11825 N. Pennsylvania Street
Carmel, IN 46032
ING Baring Furman Selz $ 500,000 16,326
230 Park Avenue
New York, NY 10169
Jefferies & Co. $ 30,000 979
c/o SSI Investment Management Inc.
357 N. Canon Drive
Beverly Hills, CA 90210
Kapiolani Health $ 125,000 4,081
c/o SSI Investment Management Inc.
357 N. Canon Drive
Beverly Hills, CA 90210
Key Tr. Convertible Sec. Fd. $ 448,000 14,628
c/o Key Asset Management, Inc.
127 Public Square, 10th Floor
Cleveland, OH 44114
PRINCIPAL AMOUNT NUMBER OF
OF NOTES COVERED SHARES COVERED
SELLING SECURITYHOLDER BY THIS PROSPECTUS BY THIS PROSPECTUS
________________________________ ____________________ ___________________
Lutheran Brotherhood $ 2,000,000 65,306
MS 1010
625 Fourth Avenue South
Minneapolis, MN 55415
Merrill Lynch, Pierce Fenner
and Smith, Inc. $ 5,435,000a 177,469a
101 Hudson Street, 10th Floor
Jersey City, NJ 07302
Midwestern National Life of Ohio $ 200,000 6,530
c/o Conseco Capital Management
11825 N. Pennsylvania Street
Carmel, IN 46032
Morgan Stanley Dean Witter $ 13,101,000a 427,787a
1585 Broadway, 5th Floor
New York, NY 10036
Nomura International PLC London $ 5,000,000 163,265
Nomura House
1st Martins-Le-Grand
London ECIA 4NP
Pacific Life Insurance Company $ 11,500,000 375,510
700 Newport Center Dr.
Newport Beach, CA 92660
Parker Society/Convertible Fund $ 25,000 816
c/o Key Asset Management, Inc.
127 Public Square, 10th Floor
Cleveland, OH 44114
Pepperdine University Pool A#1 $ 275,000 8,979
c/o SSI Investment Management Inc.
357 N. Canon Drive
Beverly Hills, CA 90210
Physicians' Reciprocal Insurers
Account #7 $ 725,000 23,673
c/o Calamos Asset Management, Inc.
1111 E. Warrenville Road
Naperville, IL 60563
Potlach-First Trust Co of St. Paul $ 825,000 26,938
c/o Key Asset Management, Inc.
127 Public Square, 10th Floor
Cleveland, OH 44114
Southern Farm Bureau Life Insurance $ 250,000 8,163
Company
c/o Calamos Asset Management, Inc.
1111 E. Warrenville Road
Naperville, IL 60563
PRINCIPAL AMOUNT NUMBER OF
OF NOTES COVERED SHARES COVERED
SELLING SECURITYHOLDER BY THIS PROSPECTUS BY THIS PROSPECTUS
________________________________ ____________________ ___________________
SPT $ 900,000 29,387
c/o Calamos Asset Management, Inc.
1111 E. Warrenville Road
Naperville, IL 60563
Tracor, Inc. Employees
Retirement Plan $ 210,000 6,857
c/o SSI Investment Management Inc.
357 N. Canon Drive
Beverly Hills, CA 90210
University of So. Florida Fdn. $ 150,000 4,897
c/o Key Asset Management, Inc.
127 Public Square, 10th Floor
Cleveland, OH 44114
Victory Convertible Sec Fd. $ 250,000 8,163
c/o Key Asset Management, Inc.
127 Public Square, 10th Floor
Cleveland, OH 44114
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a Principal Amount of Notes and Number of Shares represented in this Supplement
by this Selling Securityholder is in addition to those Notes and Shares set
forth with respect to this Selling Securityholder in the Prospectus, as
supplemented through the date hereof.
RISK FACTOR
You should carefully read the following risk factor before purchasing any Notes.
Discovery of Accounting Irregularities and Related Litigation and SEC
Investigation
On April 15, 1998, we announced that in the course of transferring
responsibility for the Company's accounting functions from the former CUC
International Inc. ("CUC") personnel to former HFS Incorporated ("HFS")
accounting personnel and preparing for the reporting of first quarter 1998
financial results, we discovered accounting irregularities in certain CUC
business units. As a result, upon discovering such accounting irregularities in
certain former CUC business units, the Audit Committee of our Board of Directors
and its counsel, assisted by auditors, immediately began an intensive
investigation that resulted, in part, in us restating our previously reported
financial results for 1997, 1996 and 1995. Our restated net income (loss)
totaled $(217.2) million, $330.0 million and $229.8 million in 1997, 1996 and
1995, respectively ($(0.27), $0.41 and $0.31 per diluted share, respectively).
We originally reported corresponding net income of $55.4 million, $423.6 million
and $302.8 million in 1997, 1996 and 1995, repectively ($0.06, $0.52 and $0.42
per diluted share, respectively).
As a result of these accounting irregularities, numerous purported class
action lawsuits, two purported derivative lawsuits and an individual lawsuit
have been filed against us and, among others, HFS, and certain current and
former officers and directors of us and HFS, asserting various claims under the
federal securities laws and certain state statutory and common laws, including
claims that our previously issued financial statements allegedly were false and
misleading and that we allegedly know or should have known that they caused the
price of our securities to be artificially inflated. In addition, the staff of
the SEC and the United States Attorney for the District of New Jersey are
conducting investigations relating to the accounting issues. The SEC Staff has
advised the Company that its inquiry should not be construed as an indication by
the SEC or its staff that any violations of law have occurred. Please see the
Company's Form 10-K/A for the fiscal year ending December 31, 1997 for
additional information regarding this litigation.
We do not believe that it is feasible to predict or determine the final
outcome of these proceedings or to estimate the amounts or potential range of
loss with respect to the resolution of these proceedings. In addition, the
timing of the final resolution of the proceedings is uncertain. The possible
outcome or resolution of the proceedings could include a judgment against us or
a settlement and could require substantial payments by us. Our management
believes that an adverse outcome with respect to such proceedings could have a
material impact on our financial condition, results of operations and cash
flows.