Cendant Corp. has agreed to settle the common shareholder litigation arising from accounting irregularities discovered at its CUC International division in April 1998. The $2.8 billion settlement will result in an approximate $1.8 billion after-tax charge in the current quarter. The charge will be a non-cash item initially, and a liability will be recorded on the balance sheet. The liability will be reduced as cash payments are made to the plaintiffs. Payments will come from cash on hand, internally generated cash flow, and additional bank debt. No financial covenants in the company's bank credit facilities are expected to be violated. The exact timing of these payments is not certain because the decision may be appealed by certain litigants, but they
