EXHIBIT 99
PRO FORMA FINANCIAL INFORMATION (UNAUDITED)
The following Unaudited Pro Forma Condensed Combined Balance Sheet gives effect
to the October 1, 2001 acquisition of Galileo International, Inc. ("Galileo").
The following Unaudited Pro Forma Condensed Combined Statements of Operations
gives effect to the acquisition of Galileo and the Company's March 1, 2001
acquisition of Avis Group Holdings, Inc. ("Avis"). Both transactions have been
accounted for under the purchase method of accounting.
Since the acquisition of Avis occurred on March 1, 2001, the financial position
of Avis is included in the Company's historical balance sheet as of September
30, 2001. The Unaudited Pro Forma Condensed Combined Balance Sheet assumes the
acquisition of Galileo occurred on September 30, 2001. The Unaudited Pro Forma
Condensed Combined Statements of Operations assume the acquisitions of Avis and
Galileo both occurred on January 1, 2000. The unaudited pro forma financial
information is based on the historical consolidated financial statements of the
Company, Avis and Galileo under the assumptions and adjustments set forth in the
accompanying explanatory notes.
The Unaudited Pro Forma Condensed Combined Statement of Operations for the year
ended December 31, 2000 also gives effect to various significant finance-related
activities that occurred during the first quarter of 2001, which comprise the
issuance of debt securities (net of debt retirements) and equity securities, the
conversion of PRIDES to CD common stock and the issuance of zero-coupon senior
convertible notes. The Unaudited Pro Forma Condensed Combined Statement of
Operations for the year ended December 31, 2000 assumes these financing
activities occurred on January 1, 2000.
For purposes of developing the Unaudited Pro Forma Condensed Combined Balance
Sheet, Galileo's assets and liabilities were recorded at their estimated fair
values and the excess purchase price was assigned to goodwill. These fair values
are based on preliminary estimates. Accordingly, the pro forma adjustments may
be subject to revision once appraisals, evaluations and other studies of the
fair value of Galileo's assets and liabilities are finalized. Pursuant to
Statement of Financial Accounting Standards ("SFAS") No. 142, "GOODWILL AND
OTHER INTANGIBLE ASSETS," the Company will not be amortizing goodwill and
certain other intangible assets arising from the acquisition of Galileo.
Since Avis was consolidated with the Company as of March 1, 2001, Avis' results
of operations between January 1, 2001 and February 28, 2001 were combined with
the Company's results of operations for the full nine months, which were then
added to Galileo's results of operations for the full nine months, subject to
certain pro forma adjustments, to provide the combined pro forma results of
operations. All intercompany transactions were eliminated on a pro forma basis.
Historically, Avis paid the Company for services the Company provided related to
call centers and information technology and for the use of the Company's
trademarks, and Avis paid Galileo for services Galileo provided related to
reservations for vehicle rentals.
The pro forma adjustments relating to the acquisition of Galileo reflect the
disbursement of a combination of CD common stock and cash aggregating $20.91 for
each share of Galileo common stock outstanding, the fair value of CD common
stock options exchanged with certain fully-vested Galileo stock options of
approximately $32 million and estimated transaction costs and expenses of
approximately $36 million. Approximately $1,482 million of the merger
consideration was funded through the issuance of CD common stock, with the
remainder being financed by available cash. In addition, Cendant repaid, from
available cash, $555 million of $586 million of Galileo's debt assumed.
In August 2000, Avis contributed its European vehicle management and leasing
business ("PHH Europe") to a newly formed joint venture in exchange for cash,
settlement of intercompany debt and a 20% interest in the venture (the "PHH
Europe Transaction"). The accompanying Supplemental Unaudited Pro Forma
Condensed Combined Statement of Operations of Avis for the year ended December
31, 2000 has been adjusted to reflect the PHH Europe Transaction.
The Company continues to review acquired operations, which may result in a plan
to realign or reorganize certain of those operations. The costs of implementing
such a plan, if it were to occur, have not been reflected in the accompanying
pro forma financial information. The impact of a potential realignment or
reorganization could increase or decrease the amount of goodwill and intangible
assets and any related amortization in the accompanying pro forma financial
information. Additionally, the Unaudited Pro Forma Condensed Combined Statement
of Operations excludes any benefits that might result from the acquisitions due
to synergies that may be derived or from the elimination of duplicate efforts.
The Company's management believes that the assumptions used provide a reasonable
basis on which to present the unaudited pro forma financial information. The
Company has completed other acquisitions and dispositions which are not
significant and, accordingly, have not been included in the accompanying
unaudited pro
1
<Page>
forma financial information. The unaudited pro forma financial information may
not be indicative of the financial position or results of operations that would
have occurred if the acquisitions of Avis and Galileo had been in effect on the
dates indicated or which might be obtained in the future.
The unaudited pro forma financial information should be read in conjunction with
the historical consolidated financial statements and accompanying notes thereto
for the Company, Avis and Galileo. Certain reclassifications have been made to
the historical amounts of Galileo to conform with the Company's classification.
2
<Page>
UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
AS OF SEPTEMBER 30, 2001
(in millions)
<Table>
<Caption>
PURCHASE
HISTORICAL HISTORICAL AND OTHER COMBINED
CENDANT GALILEO ADJUSTMENTS PRO FORMA
---------- ---------- ----------- ---------
ASSETS
Current assets
Cash and cash equivalents $ 3,201 $ 25 $ (931)(a)(b) 2,295
Receivables, net 1,196 215 -- 1,411
Stockholder litigation settlement trust 1,100 -- -- 1,100
Deferred income taxes 827 22 -- 849
Other current assets 1,087 33 -- 1,120
--------- -------- -------- -------
Total current assets 7,411 295 (931) 6,775
Property and equipment, net 1,654 392 26 (b) 2,072
Deferred income taxes 347 -- -- 347
Franchise agreements, net 1,653 -- -- 1,653
Goodwill, net 5,496 288 1,591 (b) 7,375
Other intangibles, net 782 394 50 (b) 1,226
Other assets 1,992 128 (50)(b) 2,070
--------- -------- -------- -------
Total assets exclusive of assets under programs 19,335 1,497 686 21,518
--------- -------- -------- -------
Assets under management and mortgage programs
Mortgage loans held for sale 826 -- -- 826
Relocation receivables 339 -- -- 339
Vehicle-related, net 8,166 -- -- 8,166
Timeshare receivables 280 -- -- 280
Mortgage servicing rights 1,949 -- -- 1,949
--------- -------- -------- -------
11,560 -- -- 11,560
--------- -------- -------- -------
TOTAL ASSETS $ 30,895 $ 1,497 $ 686 $33,078
========= ======== ======== =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and other current liabilities $ 2,703 $ 228 $ 150 (b) $ 3,081
Current portion of long-term debt 221 133 (121)(a) 233
Stockholder litigation settlement 2,850 -- -- 2,850
Deferred income 984 -- -- 984
Deferred income taxes -- -- (1)(b) (1)
--------- -------- -------- -------
Total current liabilities 6,758 361 28 7,147
Long-term debt, excluding Upper DECS 5,521 453 (434)(a) 5,540
Upper DECS 863 -- -- 863
Other liabilities 702 142 119 (b) 963
--------- -------- -------- -------
Total liabilities exclusive of liabilities under programs 13,844 956 (287) 14,513
--------- -------- -------- -------
Liabilities under management and mortgage programs
Debt 9,741 -- -- 9,741
Deferred income taxes 1,030 -- -- 1,030
--------- -------- -------- -------
10,771 -- -- 10,771
--------- -------- -------- -------
Mandatorily redeemable preferred interest in a subsidiary 375 -- -- 375
--------- -------- -------- -------
Stockholders' equity 5,905 541 973(c) 7,419
--------- -------- -------- -------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 30,895 $ 1,497 $ 686 $33,078
========= ======== ======== =======
</Table>
SEE ACCOMPANYING NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET.
3
<Page>
NOTES TO UNAUDITED PRO FORMA
CONDENSED COMBINED BALANCE SHEET
AS OF SEPTEMBER 30, 2001
(DOLLARS IN MILLIONS)
(a) Represents the repayment of a portion of the Galileo long-term debt
assumed ($555).
(b) Represents the excess of the purchase price over the preliminary estimate
of the fair value of the identifiable net assets acquired, calculated as
follows:
<Table>
Calculation of acquisition of goodwill
Cash consideration $ 358
Issuance of CD common stock 1,482
Fair value of CD common stock options issued in exchange for Galileo stock options 32
Transition costs and expenses (includes cash payments of $18) 36
----------
Total purchase price 1,908
----------
Preliminary estimate of fair value of identifiable net assets acquired
Historical book value of assets acquired net of liabilities assumed 541
Elimination of Galileo goodwill (288)
Preliminary estimate of fair value adjustments to identifiable intangible assets 50
Preliminary estimate of fair value adjustments to property and equipment 26
Preliminary estimate of fair value adjustments to other current liabilities (132)
Preliminary estimate of fair value adjustments to other assets ($50) and other liabilities ($119) (169)
Deferred tax liability on fair value adjustments and transaction costs and expenses 1
----------
Preliminary estimate of fair value of identifiable net assets acquired 29
----------
Acquisition goodwill $ 1,879
==========
Calculation of acquisition goodwill adjustment
Acquisition goodwill $ 1,879
Historical Galileo goodwill (288)
----------
Acquisition goodwill adjustment $ 1,591
==========
</Table>
(c) Represents the issuance of CD common stock in exchange for all outstanding
shares of Galileo common stock ($1,482) and the issuance of CD common
stock options in exchange for all outstanding Galileo stock options ($32),
partially offset by the elimination of Galileo equity balances ($541).
4
<Page>
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<Table>
<Caption>
HISTORICAL
AVIS AVIS GALILEO
HISTORICAL JAN 1-FEB 28, PURCHASE ADJUSTED HISTORICAL PURCHASE COMBINED
CENDANT 2001 ADJUSTMENTS CENDANT GALILEO ADJUSTMENTS PRO FORMA
---------- ------------- ----------- -------- ----------- ----------- ---------
REVENUES
Membership and service fees, net $3,803 $ 27 $ (34)(a) $3,796 $ -- $ -- $3,796
Vehicle-related 2,520 594 -- 3,114 -- -- 3,114
Global distribution services -- -- -- -- 1,244 (9)(f) 1,235
Other 47 20 -- (b) 67 65 -- 132
------ ----- ----- ------ ------ ----- ------
Net revenues 6,370 641 (34) 6,977 1,309 (9) 8,277
EXPENSES
Operating 2,101 174 (34)(a) 2,241 305 (9)(f) 2,537
Selling, general and administrative 1,351 115 -- 1,466 592 (39)(g) 2,019
Vehicle depreciation, lease charges
and interest, net 1,285 350 -- 1,635 -- -- 1,635
Non-vehicle depreciation and
amortization 347 23 2 (c) 372 179 (109)(g) 442
Other charges, net 299 -- -- 299 -- -- 299
Non-vehicle interest, net 176 12 1 (d) 189 26 (28)(h) 187
Other, net -- -- -- -- 5 -- 5
------ ----- ----- ------ ------ ----- ------
Total expenses 5,559 674 (31) 6,202 1,107 (185) 7,124
------ ----- ----- ------ ------ ----- ------
Net gain on dispositions of businesses 435 -- -- 435 -- -- 435
------ ----- ----- ------ ------ ----- ------
INCOME (LOSS) BEFORE INCOME TAXES,
MINORITY INTEREST AND EQUITY IN
HOMESTORE.COM 1,246 (33) (3) 1,210 202 176 1,588
Provision (benefit) for income
taxes 438 (10) (2)(e) 426 89 52(i) 567
Minority interest, net of tax 22 -- -- 22 -- -- 22
Losses related to equity in
Homestore.com, net of tax 56 -- -- 56 -- -- 56
------ ----- ----- ------ ------ ----- ------
INCOME (LOSS) BEFORE CUMULATIVE
EFFECT OF ACCOUNTING CHANGE $ 730 $ (23) $ (1) $ 706 $ 113 $ 124 $ 943
====== ===== ===== ====== ====== ===== ======
CD COMMON STOCK INCOME PER SHARE
INCOME BEFORE CUMULATIVE EFFECT OF
ACCOUNTING CHANGE
Basic $ 0.85 $0.83 $ 0.98
Diluted 0.81 0.78 0.93
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic 832 832 117(j) 949
Diluted 883 883 117(j) 1,000
MOVE.COM COMMON STOCK INCOME PER SHARE
INCOME BEFORE CUMULATIVE EFFECT OF
ACCOUNTING CHANGE
Basic $ 9.94 $9.94 $ 9.94
Diluted 9.81 9.81 9.81
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic 2 2 2
Diluted 2 2 2
</Table>
SEE ACCOMPANYING NOTES TO UNAUDITED PRO FORMA CONDENSED
COMBINED STATEMENT OF OPERATIONS.
5
<Page>
NOTES TO UNAUDITED PRO FORMA
CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001
(DOLLARS IN MILLIONS)
THE FOLLOWING PRO FORMA ADJUSTMENTS RELATE TO THE ACQUISITION OF AVIS.
(a) Represents the elimination of amounts paid by Avis to the Company for
services provided related to call centers and information technology and
for the use of trademarks.
(b) Represents the elimination of the Company's earnings attributable to its
investment in Avis for which the combined effect is zero.
(c) Represents the amortization of goodwill generated on the excess of the
purchase price over the preliminary estimate of fair value of identifiable
net assets acquired on a straight-line basis over 40 years, partially
offset by the reversal of Avis' amortization of pre-acquisition goodwill
and other identifiable intangibles resulting from the allocation of the
purchase price on a straight-line basis over 20 years.
(d) Represents interest expense on debt issued to finance a portion of the
purchase price ($7), partially offset by the amortization of the fair
value adjustment on acquired debt ($4) and the reversal of Avis'
amortization of debt-related costs ($2).
(e) Represents the income tax effect of the purchase adjustments at an
estimated statutory rate of 38.5% (not including adjustments for
non-deductible goodwill).
THE FOLLOWING PRO FORMA ADJUSTMENTS RELATE TO THE ACQUISITION OF GALILEO.
(f) Represents the elimination of amounts paid by Avis to Galileo for services
provided related to reservations for vehicle rentals.
(g) Represents the (i) amortization of estimated identifiable intangibles on a
straight-line basis ($10) and (ii) depreciation and amortization of the
estimated value of property and equipment ($60), net of the reversal of
Galileo's (i) amortization of pre-acquisition goodwill ($41), (ii)
amortization of other intangible assets ($31), (iii) depreciation and
amortization of property and equipment ($107) and (iv) amortization of
other assets ($39).
(h) Represents interest expense relating to the Galileo long-term debt that
was repaid at closing.
(i) Represents the income tax effect of the purchase adjustments at an
estimated statutory rate of 38.5% (not including adjustments for
non-deductible goodwill).
(j) Represents the issuance of 117 million shares of CD common stock used to
fund a portion of the purchase price.
6
<Page>
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2000
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<Table>
<Caption>
AVIS OTHER GALILEO
HISTORICAL ADJUSTED PURCHASE PRO FORMA ADJUSTED HISTORICAL PURCHASE COMBINED
CENDANT AVIS(*) ADJUSTMENTS ADJUSTMENTS CENDANT GALILEO ADJUSTMENTS PRO FORMA
--------- -------- ----------- ----------- -------- ---------- ----------- ---------
REVENUES
Membership and service
fees, net $ 4,512 $ 155 $(173)(a) $ -- $ 4,494 $ -- $ -- $ 4,494
Vehicle-related -- 3,783 -- -- 3,783 -- -- 3,783
Global distribution services -- -- -- -- -- 1,561 (13)(k) 1,548
Other 147 151 (39)(b) -- 259 82 -- 341
------- ------ ----- ----- ------- ------ ----- --------
Net revenues 4,659 4,089 (212) -- 8,536 1,643 (13) 10,166
EXPENSES
Operating 1,426 966 (173)(a) -- 2,219 368 (13)(k) 2,574
Vehicle depreciation, lease
charges and interest, net -- 1,671 -- -- 1,671 -- -- 1,671
Selling, general and
administrative 1,508 637 -- -- 2,145 701 (40)(l) 2,806
Non-vehicle depreciation
and amortization 352 74 16(c) -- 442 218 (123)(l) 537
Other charges, net 111 -- -- -- 111 28 -- 139
Non-vehicle interest, net 148 482 6(d) 54(g,i) 690 45 (47)(m) 688
Other, net -- -- -- -- -- 17 -- 17
------- ------ ----- ----- ------- ------ ----- --------
Total expenses 3,545 3,830 (151) 54 7,278 1,377 (223) 8,432
------- ------ ----- ----- ------- ------ ----- --------
Net loss on dispositions of
businesses (8) -- (35)(e) -- (43) -- -- (43)
------- ------ ----- ----- ------- ------ ----- --------
Income before income taxes,
minority interest and equity
in Homestore.com 1,106 259 (96) (54) 1,215 266 210 1,691
Provision for income taxes 362 117 (30)(f) (20)(f) 429 117 61(n) 607
Minority interest, net of tax 84 7 -- (66)(h) 25 -- -- 25
------- ------ ----- ----- ------- ------ ----- --------
Income before extraordinary
loss and cumulative effect
of accounting change $ 660 $ 135 $ (66) $ 32 $ 761 $ 149 $ 149 $ 1,059
======= ====== ===== ===== ======= ====== ===== ========
CD COMMON STOCK INCOME PER
SHARE INCOME BEFORE
EXTRAORDINARY LOSS AND
CUMULATIVE EFFECT OF
ACCOUNTING CHANGE
Basic $ 0.92 $ 0.92 $ 1.12
Diluted 0.89 0.90 1.09
WEIGHTED AVERAGE SHARES
OUTSTANDING
Basic 724 107(j) 831 117(o) 948
Diluted 762 107(j) 869 117(o) 986
MOVE.COM COMMON STOCK LOSS
PER SHARE LOSS BEFORE
EXTRAORDINARY LOSS AND
CUMULATIVE EFFECT OF
ACCOUNTING CHANGE
Basic $ (1.76) $ (1.76) $ (1.76)
Diluted (1.76) (1.76) $ (1.76)
WEIGHTED AVERAGE SHARES
OUTSTANDING
Basic 3 3 3
Diluted 3 3 3
</Table>
- ----------
(*) See Supplemental Unaudited Condensed Combined Statement of Operations and
Notes included herein.
SEE ACCOMPANYING NOTES TO UNAUDITED PRO FORMA CONDENSED
COMBINED STATEMENT OF OPERATIONS.
7
<Page>
NOTES TO UNAUDITED PRO FORMA
CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2000
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
THE FOLLOWING PRO FORMA ADJUSTMENTS RELATE TO THE ACQUISITION OF AVIS AND THE
FINANCING ACTIVITIES.
(a) Represents the elimination of amounts paid by Avis to the Company for
services provided related to call centers and information technology and
for the use of trademarks.
(b) Represents the elimination of the Company's earnings attributable to its
investment in Avis.
(c) Represents the amortization of goodwill generated on the excess of fair
value over the net assets acquired on a straight-line basis over 40 years,
net of the reversal of Avis' amortization of pre-acquisition goodwill and
other identifiable intangibles resulting from the allocation of purchase
price on a straight-line basis over 20 years.
(d) Represents interest expense on debt issued to finance the acquisition of
Avis ($44), net of amortization of the fair value adjustment on acquired
debt ($25) and the reversal of Avis' amortization of debt related costs
($13).
(e) Represents the reversal of a gain of $35 million recorded by the Company,
which represents the recognition of a portion of its previously recorded
deferred gain from the 1999 sale of its fleet business due to the
disposition of PHH Europe by Avis in August 2000.
(f) Represents the income tax effect of the purchase adjustments and other pro
forma adjustments at an estimated statutory rate of 37.5% (not including
adjustments for non-deductible goodwill), except Note (e) above where the
tax effect was approximately 2%, which represented the rate at which taxes
were provided on the related gain.
(g) Represents interest expense relating to the issuance of the zero-coupon
senior convertible notes, medium-term notes, borrowing under a $650
million term loan agreement and the repayment of an existing term loan,
net of interest expense allocated to the acquisition of Avis (See Note (d)
above).
(h) Represents the reduction in preferred stock dividends resulting from the
conversion of the PRIDES to CD common stock.
(i) No adjustment has been made to reduce interest expense for interest income
on the incremental cash of $1,587 raised through the Financing Activities.
Assuming the incremental cash was invested at 5%, which represents the
Company's current rate for cash investments, interest expense would have
been reduced by $79. Additionally, income before extraordinary loss and
cumulative effect of accounting change and income per share before
extraordinary loss and cumulative effect of accounting change would have
improved by $49 and $0.06, respectively.
(j) Represents the issuance of CD common stock of 61 million shares and 46
million shares relating to the conversion of PRIDES to CD common stock and
the issuance of CD common stock, respectively.
THE FOLLOWING PRO FORMA ADJUSTMENTS RELATE TO THE ACQUISITION OF GALILEO.
(k) Represents the elimination of amounts paid by Avis to Galileo for services
provided related to reservations for vehicle rentals.
(l) Represents the (i) amortization of estimated identifiable intangibles on a
straight-line basis over 25 years ($13) and (ii) depreciation and
amortization of the estimated value of property and equipment ($82), net
of the reversal of Galileo's (i) amortization of pre-acquisition goodwill
($47), (ii) amortization of other intangibles assets ($39), (iii)
depreciation and amortization of property and equipment ($132) and (iv)
amortization of other assets ($40).
(m) Represents interest expense relating to the Galileo long-term debt that
was repaid at closing.
(n) Represents the income tax effect of the purchase adjustments at an
estimated statutory rate of 37.5% (not including adjustments for
non-deductible goodwill).
(o) Represents the issuance of 117 million shares of CD common stock used to
fund a portion of the purchase price.
8
<Page>
SUPPLEMENTAL UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2000
(IN MILLIONS)
The unaudited pro forma financial data presented below was prepared to reflect
the historical consolidated financial statements of Avis, excluding the PHH
Europe Transaction. Avis will receive an annual license fee in connection with
the PHH Europe Transaction from the joint venture for the license of the PHH
fleet management technology, PHH interactive. Avis utilized the proceeds of the
PHH Europe Transaction to reduce Avis' indebtedness and to pay transaction
costs.
<Table>
<Caption>
HISTORICAL SALE OF PRO FORMA ADJUSTED
AVIS PHH EUROPE (a) ADJUSTMENTS AVIS
------------ -------------- ----------- ------------
REVENUES
Service fees, net $ 241 $ (86) $ -- $ 155
Vehicle rental 2,467 -- -- 2,467
Vehicle leasing and other fees 1,389 (73) -- 1,316
Other 146 -- 5(b) 151
------------ -------------- ----------- ------------
Net revenues 4,243 (159) 5 4,089
EXPENSES
Operating 966 -- -- 966
Vehicle depreciation and lease charges 1,695 (24) -- 1,671
Selling, general and administrative 693 (56) -- 637
Interest, net 577 (37) (58)(c) 482
Depreciation and amortization 89 (12) (3)(d) 74
------------ -------------- ----------- ------------
Total expenses 4,020 (129) (61) 3,830
INCOME (LOSS) BEFORE INCOME TAXES AND MINORITY INTEREST 223 (30) 66 259
Provision (benefit) for income taxes 95 (3) 25(e) 117
Minority interest 7 -- -- 7
------------ ----------- ---------- ------------
INCOME (LOSS) BEFORE EXTRAORDINARY LOSS AND
CUMULATIVE EFFECT OF ACCOUNTING CHANGE $ 121 $ (27) $ 41 $ 135
============ =========== ========== ============
</Table>
SEE ACCOMPANYING NOTES TO SUPPLEMENTAL UNAUDITED PRO FORMA CONDENSED
COMBINED STATEMENT OF OPERATIONS.
9
<Page>
NOTES TO SUPPLEMENTAL UNAUDITED PRO FORMA
CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2000
(DOLLARS IN MILLIONS)
(a) Represents adjustments to pro forma the results of operations of PHH
Europe, assuming that the PHH Europe Transaction occurred on January 1,
2000.
(b) Represents fleet management technology fee income and the equity in the
earnings of the joint venture formed pursuant to the PHH Europe
Transaction, net of the amortization of the excess of cost over the assets
acquired.
(c) Represents a reduction in interest expense resulting from the retirement
of acquisition debt and revolving credit facilities related to the
application of proceeds of $1,053 from the PHH Europe Transaction.
(d) Represents a decrease in amortization expense relating to goodwill
generated from the PHH Europe Transaction, net of the reversal of PHH
Europe goodwill.
(e) Represents the income tax effect of the pro forma adjustments at an
estimated statutory rate of 39% (not including adjustments for
non-deductible goodwill).
10