SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  ------------


                                    Form 8-K
              CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                                  ------------


                       December 7, 1999 (December 7, 1999)
               (Date of Report (date of earliest event reported))


                               Cendant Corporation
             (Exact name of Registrant as specified in its charter)


        Delaware                        1-10308                  06-0918165
(State or other jurisdiction     (Commission File No.)        (I.R.S. Employer
   of incorporation or                                   Identification Number)
      organization)

   9 West 57th Street
      New York, NY                                                  10019
 (Address of principal                                           (Zip Code)
  executive) office)




                                 (212) 413-1800
              (Registrant's telephone number, including area code)



                                      None
       (Former name, former address and former fiscal year, if applicable)



Item 5. Other Events Except as expressly indicated or unless the context otherwise requires, "Cendant", "we", "our", or "us" means Cendant Corporation, a Delaware Corporation, and its subsidiaries. Preliminary Agreement to Settle Common Stock Securities Class Action. On December 7, 1999, we announced that we reached a preliminary agreement to settle the principal securities class action pending against us in the U.S. District Court in Newark, New Jersey. Under the agreement, we would pay the class members $2.83 billion in cash. The class action was initiated following the discovery in April 1998 of accounting irregularities at former CUC International business units. We will continue to pursue our claims against CUC's former auditor, Ernst & Young LLP ("E&Y") in relation to the accounting irregularities of the former CUC business units, including claims for professional malpractice, breach of contract and breach of fiduciary duty, and claims seeking contribution from E&Y in connection with our settlement of the PRIDES litigation. As part of the settlement agreement with lead plaintiffs, the class they represent will receive 50% of any recovery by us from E&Y. With respect to the settlement, we will record a non-cash after-tax charge of approximately $1.8 billion, or $2.39 per share in the fourth quarter of 1999. Based upon the assumption that district court approval of a definitive settlement agreement will occur at the end of the first quarter of 2000, we currently estimate that the settlement may reduce 2000 earnings per share by between $0.12 and $0.16. The pro forma 12-month earnings impact, assuming the settlement occurred on January 1, 2000, is currently estimated at $0.15 to $0.21 cents per share. The impact on earnings per share will vary based on factors that include the following: o First, while we expect to resume share repurchase activity, our repurchase may not equal the $1 billion in stock we originally intended to acquire in the fourth quarter of 1999. o Second, the exact date on which we may make the actual settlement payment is uncertain, based on the date of final district court order and whether this order is appealed. From the date of the final district court order, we will accrue interest on the unpaid settlement amount. While any appeals are pending, we will deposit a letter or credit or similar security in the amount of the settlement. o Third, the timing and impact of any securities issued to ultimately finance the settlement payment will depend on market conditions at the time. o Fourth, while we expect to generate significant tax benefits form the ultimate settlement payment, these will only be recovered on a cash basis over time as we generate taxable income that can be offset against the loss generated by the settlement. Thus, we may only be able to recover the tax deduction over several years. The speed with which we can utilize the tax benefits will affect the EPS impact of the settlement. The proposed settlement will have no impact on the balance sheet, earnings or cash flow of our independent finance subsidiary, PHH Corporation. The proposed settlement resolves all class actions brought on behalf of purchasers of securities issued by CUC, HFS Incorporated or us, other than certain remaining claims relating to the FELINE PRIDES securities. The proposed settlement does not encompass all pending litigation asserting claims associated with the CUC accounting irregularities. However, in our opinion, the potential impact of all such unresolved litigation outside of the proposed settlement should not be material. The timing and manner of distribution of the settlement to members of the class will be subject to a plan of distribution to be developed by plaintiffs' counsel subject to approval by the Court. Questions concerning the terms of the settlement agreement should be directed to lead plaintiffs' counsel: Barrack, Rodos & Bacine, 3300 Two Commerce Sq., Philadelphia, PA 19103 (215) 963-0600 or Bernstein, Litowitz, Berger & Grossmann LLP, 1258 Avenue of the Americas, New York, NY 10019 (212) 554-1400. Corporate Governance Initiatives. We also announced that we are undertaking additional initiatives in the area of corporate governance, and we expect those initiatives to make an important contribution toward further building shareholder value. These actions include meeting a very strict definition of independence for a majority of our directors; continuing to maintain a compensation committee comprised of only independent directors; continuing to maintain an audit committee comprised of only independent directors and including at least one director with accounting or financial expertise; the establishment of a nominating committee comprised entirely of independent directors; requiring shareholder approval prior to any re-pricing of employee stock options; and asking shareholders to approve a motion by our next annual meeting to elect all directors on an annual basis. Reference is made to Exhibit 99.1 for the full text of the press release relating to the preliminary settlement, which is incorporated herein by reference in its entirety. Item 7. Exhibits Exhibit No. Description - -------- ---------------------------------------------------------------------- 99.1 Press Release: Cendant Reaches Preliminary Agreement to Settle Common Stock Securities Class Action for $2.83 Billion, dated December 7, 1999.

SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. CENDANT CORPORATION By: /s/ James E. Buckman James E. Buckman Vice Chairman and General Counsel Date: December 7, 1999

CENDANT CORPORATION CURRENT REPORT ON FORM 8-K Report Dated December 7, 1999 (December 7, 1999) EXHIBIT INDEX Exhibit No. Description - -------- ---------------------------------------------------------------------- 99.1 Press Release: Cendant Reaches Preliminary Agreement to Settle Common Stock Securities Class Action for $2.83 Billion, dated December 7, 1999.



EXHIBIT 99.1

                 Cendant Reaches Preliminary Agreement To Settle
             Common Stock Securities Class Action for $2.83 Billion

      Cendant to Record $1.8 Billion Non-Cash, After-Tax Charge in 4Q 1999

            Settlement Expected to Reduce 2000 EPS by $0.12 to $0.16

                   Cendant to Resume Share Repurchase Activity

               Company to Expand Corporate Governance Initiatives


Cendant  announced  today that it has reached a preliminary  agreement to settle
the  principal  securities  class  action  pending  against  Cendant in the U.S.
District Court in Newark, New Jersey. Under the agreement, Cendant would pay the
class members $2.83  billion in cash.  The class action was initiated  following
the  discovery  in  April  1998  of  accounting  irregularities  at  former  CUC
International (CUC) business units.

Cendant will continue to pursue its claims against CUC's former auditor, Ernst &
Young LLP (E&Y) in relation to the accounting  irregularities  of the former CUC
business  units,  including  claims  for  professional  malpractice,  breach  of
contract and breach of fiduciary duty, and claims seeking  contribution from E&Y
in connection with Cendant's settlement of the PRIDES litigation. As part of its
settlement agreement with lead plaintiffs, the class they represent will receive
50% of any recovery by Cendant from E&Y.

"By  eliminating  what  was  by  far  our  largest  remaining  uncertainty,  the
settlement  effectively  brings  closure to this most  unfortunate  event," said
Henry  R.  Silverman,  Cendant  Chairman,  President  and CEO.  "The  resolution
announced  today will  discharge  substantially  all of our remaining  financial
exposure  from the  former  CUC.  Further  action  lies in the hands of the U.S.
Attorney  and the SEC,  each of which we believe is  aggressively  pursuing  the
responsible  parties.  While we will continue to actively  cooperate,  we expect
that these  matters  will not affect the  Company or its  current  officers  and
directors.

"Cendant can again be valued based on the performance of our businesses, without
the overhang of this litigation,"  continued Silverman.  "This settlement allows
the fruits of our efforts to again  belong to our  shareholders,  customers  and
employees.

"The  structure  of  the  settlement  and  our  plans  to  finance  it  preserve
significant  flexibility for Cendant," concluded  Silverman.  "We will enter the
year 2000 with  significant  discretionary  cash and the financial  resources to
pursue  shareholder  value  wherever  it  lies.  Now that we have  reached  this
preliminary agreement, we will resume share repurchase activity."

The Company also announced that it is undertaking  additional initiatives in the
area of  corporate  governance,  and it  expects  those  initiatives  to make an
important  contribution toward further building shareholder value. These actions
include meeting a very strict  definition of independence  for a majority of the
Company's directors;  continuing to maintain a compensation  committee comprised
of only  independent  directors;  continuing  to  maintain  an  audit  committee
comprised of at least three  independent  directors  and  including at least one
director  with  accounting  or  financial  expertise;  the  establishment  of  a
nominating  committee  comprised  entirely of independent  directors;  requiring
shareholder  approval prior to any  re-pricing of employee  stock  options;  and
asking  shareholders to approve a motion by the Company's next annual meeting to
elect all directors on an annual basis.

The Company has engaged Chase Securities and Goldman Sachs as financial advisors
in  connection  with the  funding of the  settlement.  Bank of America  provided
credit advisory services to Cendant in connection with the settlement.

With respect to the settlement,  Cendant will record a non-cash after-tax charge
of approximately $1.8 billion, or $2.39 per share in the fourth quarter of 1999.

Based upon the assumption  that district  court approval of the settlement  will
occur at the end of the first quarter of 2000, the Company  currently  estimates
that the  settlement  may reduce 2000  earnings  per share by between  $0.12 and
$0.16. The pro forma 12-month earnings impact,  assuming the settlement occurred
on January 1, 2000, is currently estimated at $0.15 to $0.21 cents per share.

The impact on earnings per share in 2000 will vary based on factors that include
the following:

o    First, while the Company expects to resume share repurchase  activity,  its
     repurchases  may not equal the $1 billion in stock the  Company  originally
     intended to acquire in the fourth quarter of 1999.

o    Second,  the exact date on which  Cendant  may make the  actual  settlement
     payment is uncertain,  based on the date of final  district court order and
     whether this order is appealed.  From the date of the final  district court
     order,  Cendant will accrue interest on the unpaid settlement amount. While
     any appeals are pending, Cendant will deposit a letter of credit or similar
     security in the amount of the settlement.

o    Third, the timing and impact of any securities issued to ultimately finance
     the settlement payment will depend on market conditions at the time.

o    Fourth, while Cendant expects to generate significant tax benefits from its
     ultimate settlement  payment,  these will only be recovered on a cash basis
     over time as Cendant  generates  taxable  income that can be offset against
     the loss  generated by the  settlement.  Thus,  Cendant may only be able to
     recover its tax deduction over several  years.  The speed with which it can
     utilize the tax benefits will affect the EPS impact of the settlement.

The proposed  settlement  will have no impact on the balance sheet,  earnings or
cash flow of Cendant's independent finance subsidiary, PHH Corporation.

The  proposed  settlement  resolves  all  class  actions  brought  on  behalf of
purchasers of securities issued by CUC, HFS Incorporated or Cendant,  other than
certain  remaining  claims  relating to FELINE PRIDES  securities.  The proposed
settlement does not encompass all pending litigation asserting claims associated
with the CUC accounting irregularities.  However, in the opinion of the Company,
the potential impact of all such unresolved  litigation  outside of the proposed
settlement is not material.

The timing and manner of  distribution of the settlement to members of the class
will be subject to a plan of distribution to be developed by plaintiffs' counsel
subject  to  approval  by the  Court.  Questions  concerning  the  terms  of the
settlement  agreement should be directed to lead plaintiffs'  counsel:  Barrack,
Rodos & Bacine, 3300 Two Commerce Sq., Philadelphia,  PA 19103 (215) 963-0600 or
Bernstein,  Litowitz,  Berger & Grossmann LLP, 1285 Avenue of the Americas,  New
York, NY 10019 (212) 554-1400.

Statements   about  future   results   made  in  this  release  may   constitute
forward-looking   statements  within  the  meaning  of  the  Private  Securities
Litigation   Reform  Act  of  1995.   These  statements  are  based  on  current
expectations  and the current  economic  environment.  The Company cautions that
these statements are not guarantees of future performance. They involve a number
of risks and  uncertainties  that are difficult to predict including the outcome
of litigation.  Actual results could differ  materially  from those expressed or
implied  in the  forward-looking  statements.  Important  assumptions  and other
important  factors that could cause  actual  results to differ  materially  from
those in the  forward-looking  statements  are specified in the  Company's  Form
10-K/A  for the year  ended  December  31,  1998,  including  completion  of the
settlement of the class action litigation.