<PAGE>
As filed with the Securities and Exchange Commission on March 18, 1998
Registration No. 333-42901
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------
POST-EFFECTIVE AMENDMENT NO. 1
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------
FAIRFIELD COMMUNITIES, INC.
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 71-0390438
(State of Incorporation) (IRS Employer
Identification Number)
11001 EXECUTIVE CENTER DRIVE
LITTLE ROCK, ARKANSAS 72211
(Address of Principal Executive Offices)
VACATION BREAK U.S.A., INC.
DIRECTORS' STOCK OPTION PLAN
VACATION BREAK U.S.A., INC.
1995 STOCK OPTION PLAN
(Full Title of the Plans)
MARCEL J. DUMENY, ESQ.
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
FAIRFIELD COMMUNITIES, INC.
11001 EXECUTIVE CENTER DRIVE
LITTLE ROCK, ARKANSAS 72211
(501) 228-2700
(Name, Address and Telephone Number of Agent for Service)
------------------
================================================================================
<PAGE>
EXPLANATORY NOTE
The information called for by Part I of Form S-8 is included in the
description of the Vacation Break U.S.A., Inc. Directors' Stock Option Plan, as
amended (the "Directors' Plan") and the description of the Vacation Break
U.S.A., Inc. 1995 Stock Option Plan, as amended (the "1995 Plan") to be
delivered to persons purchasing shares pursuant to the Directors' Plan or the
1995 Plan, respectively. Pursuant to the Note to Part I of Form S-8, that
information is not being filed with or included in this Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 8. EXHIBITS
Exhibits 4.4 and 4.5 are hereby amended and restated in their entirety.
4.1 Second Amended and Restated Certificate of Incorporation of the
Company (previously filed as Exhibit 3.8 to the Form 8-K filed by the
Company on September 1, 1992, SEC File No. 92-22-6962).
4.2 Certificate of Amendment to Amended and Restated Certificate of
Incorporation of the Company (previously filed as Exhibit 4.2 to the
Company's registration statement on Form S-8 , SEC File No. 333-
42901).
4.3 Fifth Amended and Restated Bylaws of the Company (previously filed as
Exhibit 3.(ii) to the Form 8-K filed by the Company on May 22, 1996,
SEC File No. 001-08096).
4.4 Vacation Break U.S.A., Inc. Directors' Stock Option Plan, as amended
(filed herewith).
4.5 Vacation Break U.S.A., Inc. 1995 Stock Option Plan, as amended (filed
herewith).
5.1 Opinion of Jones, Day, Reavis & Pogue (previously filed).
23.1 Consent of Ernst & Young LLP (filed herewith).
23.2 Consent of Coopers & Lybrand L.L.P. (filed herewith).
23.3 Consent of Jones, Day, Reavis & Pogue (included in Exhibit 5.1).
24.1 Power of Attorney (previously filed).
-2-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Post-Effective
Amendment No. 1 to the Registration Statement (Commission File No. 333-42901) to
be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Little Rock, State of Arkansas, on March 18, 1998.
FAIRFIELD COMMUNITIES, INC.
By: /s/ J.W. MCCONNELL
-------------------------------------
J. W. McConnell
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Post-
Effective Amendment No. 1 to the Registration Statement has been signed below by
the following persons in the capacities indicated on March 18, 1998.
<TABLE>
<CAPTION>
SIGNATURES TITLE
---------- -----
<S> <C>
/s/ J. W. MCCONNELL President and Chief Executive Officer; Director
- --------------------------------- (Principal Executive Officer)
J. W. McConnell
/s/ Robert W. Howeth* Senior Vice President and Chief Financial Officer
- --------------------------------- (Principal Financial Officer)
Robert W. Howeth
/s/ William G. Sell* Vice President/Controller
- --------------------------------- (Principal Accounting Officer)
William G. Sell
/s/ Les R. Baledge* Director
- ---------------------------------
Les R. Baledge
/s/Ernest D. Bennett, III* Director
- ---------------------------------
Ernest D. Bennett, III
/s/Philip L. Herrington* Director
- ---------------------------------
Philip L. Herrington
/s/ Gerald Johnston* Director
- ---------------------------------
Gerald Johnston
Director
- ---------------------------------
Bryan D. Langton
Director
- ---------------------------------
Charles D. Morgan
Director
- ---------------------------------
William C. Scott
</TABLE>
-3-
<PAGE>
Director
- ---------------------------------
Ralph P. Muller
*The undersigned, by signing his name hereto, does sign and execute this Post-
Effective Amendment No. 1 to the Registration Statement pursuant to the Powers
of Attorney executed on behalf of the above-named officers and directors and
previously filed with the Commission.
/s/ J. W. MCCONNELL
--------------------------------------
J.W. McConnell
-4-
<PAGE>
INDEX TO EXHIBITS
Exhibit No. Description
- ----------- -----------
4.1 Second Amended and Restated Certificate of Incorporation of the
Company (previously filed as Exhibit 3.8 to the Form 8-K filed by
the Company on September 1, 1992, SEC File No. 92-22-6962).
4.2 Certificate of Amendment to Amended and Restated Certificate of
Incorporation of the Company (previously filed as Exhibit 4.2 to
the Company's registration statement on Form S-8 , SEC File No.
333-42901).
4.3 Fifth Amended and Restated Bylaws of the Company (previously filed
as Exhibit 3.(ii) to the Form 8-K filed by the Company on May 22,
1996, SEC File No. 001-08096).
4.4 Vacation Break U.S.A., Inc. Directors' Stock Option Plan, as
amended (filed herewith).
4.5 Vacation Break U.S.A., Inc. 1995 Stock Option Plan, as amended
(filed herewith).
5.1 Opinion of Jones, Day, Reavis & Pogue (previously filed).
23.1 Consent of Ernst & Young LLP (filed herewith).
23.2 Consent of Coopers & Lybrand L.L.P. (filed herewith).
23.3 Consent of Jones, Day, Reavis & Pogue (included in Exhibit 5.1).
24.1 Power of Attorney (previously filed).
-5-
<PAGE>
Exhibit 4.4
-----------
VACATION BREAK U.S.A., INC.
------------------------------
DIRECTORS' STOCK OPTION PLAN
------------------------------
1. PURPOSE. The purpose of this Plan is to advance the interests of
-------
VACATION BREAK U.S.A., INC., a Florida corporation, by providing an additional
incentive to attract and retain nonemployee directors through the encouragement
of stock ownership in the Company by such persons.
2. DEFINITIONS. As used herein, the following terms shall have the
------------
meaning indicated:
(a) "Annual Meeting Date" shall mean the date of the annual meeting of
the Company's shareholders at which the Directors are elected.
(b) "Board" shall mean the Company's Board of Directors.
(c) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
(d) "Common Stock" shall mean the Company's Common Stock, par value
$.01 per share.
(e) "Company" shall refer to VACATION BREAK U.S.A., INC., a Florida
corporation.
(f) "Director" shall mean a member of the Board.
(g) "Eligible Director" means any person who is a member of the Board
and who is not an employee, full time or part time, of the Company or its
subsidiaries. For purposes of this Plan, a director who does not receive
regular compensation from the Company or its subsidiaries, other than
directors' fees and reimbursement for expenses, shall not be considered to
be an employee of the Company, even if such director is an officer of a
subsidiary of the Company.
(h) "Fair Market Value" of a Share on any date of reference shall mean
the "Closing Price" (as defined below) of the Common Stock on the business
day immediately preceding such date, unless the Board in its sole
discretion shall determine otherwise in a fair and uniform manner. For the
purpose of determining Fair Market Value, the "Closing Price" of the Common
Stock on any business day shall be (i) if the Common Stock is listed or
admitted for trading on any United States national securities exchange, or
if actual transactions are otherwise reported on a consolidated transaction
reporting system, the last reported sale price of Common Stock on such
exchange or reporting system, as reported in any newspaper of general
circulation, (ii) if the Common Stock is quoted on the National Association
of Securities Dealers Automated Quotations System ("NASDAQ"), or any
similar system of automated dissemination of quotations of securities
prices in common use, the last reported sale price of Common Stock on such
system or, if sales prices are not reported, the mean between the closing
high bid and low asked quotations for such day of Common Stock on such
system, as reported in any newspaper of general circulation or (iii) if
neither clause (i) or (ii) is applicable, the mean between the high bid and
low asked quotations for the Common Stock as reported by the National
Quotation Bureau, Incorporated if at least two securities dealers have
inserted both bid and asked quotations for Common Stock on at least five of
the ten preceding days.
(i) "Initial Grant Date" means the later of (i) March 25, 1996, and
(ii) the date on which a person is elected as a member of the Board.
(j) "Option" (when capitalized) shall mean any option granted under
this Plan.
-1-
<PAGE>
(k) "Option Agreement" shall mean the agreement between the Company
and the Optionee for the grant of an option.
(l) "Optionee" shall mean a person to whom a stock option is granted
under this Plan or any person who succeeds to the rights of such person
under this Plan by reason of the death of such person.
(m) "Parent" shall mean a "parent corporation" as defined in Section
425(e) and (g) of the Code.
(n) "Plan" shall mean this Directors' Stock Option Plan for the
Company.
(o) "Share(s)" shall mean a share or shares of the Common Stock.
(p) "Subsidiary" shall mean any corporation (other than the Company)
in any unbroken chain of corporations beginning with the Company if, at the
time of the granting of the Option, each of the corporations other than the
last corporation in the unbroken chain owns stock possessing 50 percent or
more of the total combined voting power of all classes of stock in one of
the other corporations in such chain.
3. SHARES AND OPTIONS. Subject to Section 9 of this Plan, the Company
------------------
may grant to Optionees from time to time Options to purchase an aggregate of up
to forty thousand (40,000) shares from authorized and unissued Shares. If any
Option granted under the Plan shall terminate, expire, or be canceled or
surrendered as to any Shares, new Options may thereafter be granted covering
such Shares.
4. GRANTS OF OPTIONS.
-----------------
(a) On the Initial Grant Date, each Eligible Director shall receive
the grant of an Option to purchase 2,000 Shares.
(b) Each Eligible Director shall receive an annual grant of an Option
to purchase 2,000 Shares on each Annual Meeting Date, beginning with the
first Annual Meeting Date that occurs after December 31, 1996 and that is
after the Initial Grant Date for each such Eligible Director.
(c) Upon the grant of each Option, the Company and the Eligible
Director shall enter into an Option Agreement, which shall specify the
grant date and the exercise price and shall include or incorporate by
reference the substance of this Plan and such other provisions consistent
with this Plan as the Board may determine.
5. EXERCISE PRICE. The exercise price per Share of any Option shall be
--------------
the Fair Market Value of the Shares underlying such Option on the date such
Option is granted.
6. EXERCISE OF OPTIONS. An Option shall be deemed exercised when (i)
-------------------
the Company has received written notice of such exercise in accordance with the
terms of the Option, (ii) full payment of the aggregate exercise price of the
Shares as to which the Option is exercised has been made, and (iii) arrangements
that are satisfactory to the Board in its sole discretion have been made for the
Optionee's payment to the Company of the amount that is necessary for the
Company or Subsidiary employing the Optionee to withhold in accordance with
applicable Federal or State tax withholding requirements. The exercise price of
any Shares purchased shall be paid in cash, by certified or official bank check
or personal check, by money order, with Shares or by a combination of the above.
If the exercise price is paid in whole or in part with Shares, the value of the
Shares surrendered shall be their Fair Market Value on the date the Option is
exercised. No Optionee shall be deemed to be a holder of any Shares subject to
an Option unless and until a stock certificate or certificates for such Shares
are issued to such person(s) under the terms of the Plan. No adjustment shall be
made for dividends (ordinary or extraordinary, whether in cash, securities or
other property) or distributions or other rights for which the record date is
prior to the date such stock certificate is issued, except as expressly provided
in Section 9 hereof.
7. EXERCISE SCHEDULE FOR OPTIONS. Each Option granted hereunder shall
-----------------------------
not be exercisable until after six months following the date of grant of the
Option to the Eligible Director. Thereafter, such Option shall be exercisable in
full. The expiration date of an Option shall be 10 years from the date of grant
of the Option.
-2-
<PAGE>
8. TERMINATION OF OPTION PERIOD.
----------------------------
(a) The unexercised portion of any Option shall automatically and
without notice terminate and become null and void at the time of the
earliest to occur of the following:
(i) three months after the date on which the Optionee ceases to
be a Director for any reason other than by reason of (A) "Cause"
(which, for purposes of this Plan, shall mean the removal of the
Optionee as a Director by reason of any act of (1) fraud or
intentional misrepresentation, or (2) embezzlement, misappropriation,
or conversion of assets or opportunities of the Company or any
Subsidiary), or (B) death;
(ii) immediately upon the removal of the Optionee as a Director
for Cause;
(iii) one year after the date the Optionee ceases to be a
Director by reason of death of the Optionee;
(b) The Board in its sole discretion may, by giving written notice
("Cancellation Notice"), cancel any Option that remains unexercised on the
date of the consummation of any corporate transaction:
(i) if the shareholders of the Company shall approve a plan of
merger, consolidation, reorganization, liquidation or dissolution in
which the Company does not survive (unless the approved merger,
consolidation, reorganization, liquidation or dissolution is
subsequently abandoned); or
(ii) if the shareholders of the Company shall approve a plan for
the sale, lease, exchange or other disposition of all or substantially
all the property and assets of the Company (unless such plan is
subsequently abandoned).
Any Cancellation Notice shall be given a reasonable period of time prior to
the proposed date of such cancellation and may be given either before or
after shareholder approval of such corporate transaction.
9. ADJUSTMENT OF SHARES.
--------------------
(a) If at any time while the Plan is in effect or unexercised Options
are outstanding, there shall be any increase or decrease in the number of
issued and outstanding Shares through the declaration of a stock dividend
or through any recapitalization resulting in a stock split-up, combination
or exchange of Shares, then and in such event:
(i) appropriate adjustment shall be made in the maximum number
of Shares available for grant under the Plan, so that the same
percentage of the Company's issued and outstanding Shares shall
continue to be subject to being so optioned; and
(ii) appropriate adjustment shall be made in the number of
Shares and the exercise price per Share thereof then subject to any
outstanding Option, so that the same percentage of the Company's
issued and outstanding Shares shall remain subject to purchase at the
same aggregate exercise price.
(b) Subject to the specific terms of any Option, the Board may change
the terms of Options outstanding under this Plan, with respect to the
exercise price or the number of Shares subject to the Options, or both,
when, in the Board's sole discretion, such adjustments become appropriate
by reason of a corporate transaction described in Subsections 8(b)(i) or
(ii) hereof.
(c) Except as otherwise expressly provided herein, the issuance by the
Company of shares of its capital stock of any class, or securities
convertible into shares of capital stock of any class, either in connection
with a direct sale or upon the exercise of rights or warrants to subscribe
therefor, or upon conversion of shares or obligations of the Company
convertible into such shares or other securities, shall not affect, and no
adjustment by reason thereof shall be made with respect to, the number or
exercise price of the Shares then subject to outstanding Options granted
under the Plan.
-3-
<PAGE>
(d) Without limiting the generality of the foregoing, the existence of
outstanding Options granted under the Plan shall not affect in any manner
the right or power of the Company to make, authorize or consummate (i) any
or all adjustments, recapitalizations, reorganizations or other changes in
the Company's capital structure or its business; (ii) any merger or
consolidation of the Company; (iii) any issue by the Company of debt
securities, or preferred or preference stock that would rank above the
Shares subject to outstanding Options; (iv) the dissolution or liquidation
of the Company; (v) any sale, transfer or assignment of all or any part of
the assets or business of the Company; or (vi) any other corporate act or
proceeding, whether of a similar character or otherwise.
10. TRANSFERABILITY OF OPTIONS. Each Option shall provide that such
--------------------------
Option shall not be transferable by the Optionee otherwise than by will or the
laws of descent and distribution, and each Option shall be exercisable during
the Optionee's lifetime only by the Optionee.
11. ISSUANCE OF SHARES. As a condition of any sale or issuance of Shares
------------------
upon exercise of any Option, the Board may require such agreements or
undertakings, if any, as the Board may deem necessary or advisable to assure
compliance with any such law or regulation including, but not limited to, the
following:
(a) a representation and warranty by the Optionee to the Company, at
the time any Option is exercised, that he is acquiring the Shares to be
issued to him for investment and not with a view to, or for sale in
connection with, the distribution of any such Shares; and
(b) a representation, warranty and/or agreement to be bound by any
legends that are, in the opinion of the Board, necessary or appropriate to
comply with the provisions of any securities law deemed by the Board to be
applicable to the issuance of the Shares and are endorsed upon the Share
certificates.
12. ADMINISTRATION OF THE PLAN. The Plan shall be administered by the
--------------------------
Board, which shall have the authority to adopt such rules and regulations and to
make such determinations as are not inconsistent with the Plan and as are
necessary or desirable for the implementation and administration of the Plan.
13. INTERPRETATION. If any provision of the Plan should be held invalid
--------------
or illegal for any reason, such determination shall not affect the remaining
provisions hereof, but instead the Plan shall be construed and enforced as if
such provision had never been included in the Plan. The determinations and the
interpretation and construction of any provision of the Plan by the Board shall
be final and conclusive. This Plan shall be governed by the laws of the State of
Florida. Headings contained in this Plan are for convenience only and shall in
no manner be construed as part of this Plan. Any reference to the masculine,
feminine, or neuter gender shall be a reference to such other gender as is
appropriate.
14. TERM OF PLAN; AMENDMENT AND TERMINATION OF THE PLAN.
---------------------------------------------------
(a) This Plan shall become effective upon its adoption by the Board,
and shall continue in effect until all Options granted hereunder have
expired or been exercised, unless sooner terminated under the provisions
relating thereto. No Option shall be granted after 10 years from the date
of the Board's adoption of this Plan.
(b) The Board may from time to time amend the Plan or any Option;
provided, however, that, without approval by the Company's shareholders, no
such amendment shall (i) materially increase the benefits accruing to
participants under the Plan, (ii) materially increase the number of Shares
or other securities reserved for issuance upon the exercise of Options,
(iii) materially modify the requirements as to eligibility for
participation under the Plan or (iv) otherwise involve any other change or
modification requiring shareholder approval under Rule 16b-3 of the
Securities Act of 1933, as amended; and, provided, further, that, except to
the extent otherwise specifically provided in Section 8, no amendment or
suspension of the Plan or any Option issued hereunder shall substantially
impair any Option previously granted to any Optionee without the consent of
such Optionee.
(c) Notwithstanding anything else contained herein, the provisions of
this Plan which govern the number of Options to be awarded to nonemployee
directors, the exercise price per share under each such Option, when and
under what circumstances an Option will be granted and the period within
which each Option may be exercised, shall not be amended more than once
every six months (even with shareholder approval), other than to conform to
changes to the Code, or the rules promulgated thereunder, and under the
Employee Retirement Income
-4-
<PAGE>
Security Act of 1974, as amended, or the rules promulgated thereunder, or
with rules promulgated by the Securities and Exchange Commission.
(d) The Board, without further approval of the Company's shareholders,
may at any time terminate or suspend this Plan. Any such termination or
suspension of the Plan shall not affect Options already granted and such
Options shall remain in full force and effect as if this Plan had not been
terminated or suspended. No Option may be granted while the Plan is
suspended or after it is terminated. The rights and obligations under any
Option granted to any Optionee while this Plan is in effect shall not be
altered or impaired by the suspension or termination of this Plan without
the consent of such Optionee.
15. Reservation of Shares. The Company, during the term of the Plan, will
---------------------
at all times reserve and keep available a number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
-5-
<PAGE>
VACATION BREAK U.S.A., INC.
--------------------------------
AMENDED AND RESTATED DIRECTORS' STOCK OPTION PLAN
--------------------------------
1. PURPOSE. The purpose of this Plan is to advance the interests of
-------
VACATION BREAK U.S.A., INC., a Florida corporation, by providing an additional
incentive to attract and retain nonemployee directors through the encouragement
of stock ownership in the Company by such persons.
2. DEFINITIONS. As used herein, the following terms shall have the
------------
meaning indicated:
(a) "Annual Meeting Date" shall mean the date of the annual meeting of
the Company's shareholders at which the Directors are elected.
(b) "Board" shall mean the Company's Board of Directors.
(c) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
(d) "Common Stock" shall mean the Company's Common Stock, par value
$.01 per share.
(e) "Company" shall refer to VACATION BREAK U.S.A., INC., a Florida
corporation.
(f) "Director" shall mean a member of the Board.
(g) "Eligible Director" means any person who is a member of the Board
and who is not an employee, full time or part time, of the Company or its
subsidiaries. For purposes of this Plan, a director who does not receive
regular compensation from the Company or its subsidiaries, other than
directors' fees and reimbursement for expenses, shall not be considered to
be an employee of the Company, even if such director is an officer of a
subsidiary of the Company.
(h) "Fair Market Value" of a Share on any date of reference shall mean
the "Closing Price" (as defined below) of the Common Stock on the business
day immediately preceding such date, unless the Board in its sole
discretion shall determine otherwise in a fair and uniform manner. For the
purpose of determining Fair Market Value, the "Closing Price" of the Common
Stock on any business day shall be (i) if the Common Stock is listed or
admitted for trading on any United States national securities exchange, or
if actual transactions are otherwise reported on a consolidated transaction
reporting system, the last reported sale price of Common Stock on such
exchange or reporting system, as reported in any newspaper of general
circulation, (ii) if the Common Stock is quoted on the National Association
of Securities Dealers Automated Quotations System ("NASDAQ"), or any
similar system of automated dissemination of quotations of securities
prices in common use, the last reported sale price of Common Stock on such
system or, if sales prices are not reported, the mean between the closing
high bid and low asked quotations for such day of Common Stock on such
system, as reported in any newspaper of general circulation or (iii) if
neither clause (i) or (ii) is applicable, the mean between the high bid and
low asked quotations for the Common Stock as reported by the National
Quotation Bureau, Incorporated if at least two securities dealers have
inserted both bid and asked quotations for Common Stock on at least five of
the ten preceding days.
(i) "Initial Grant Date" means the later of (i) March 25, 1996, and
(ii) the date on which a person is elected as a member of the Board.
(j) "Option" (when capitalized) shall mean any option granted under
this Plan.
(k) "Option Agreement" shall mean the agreement between the Company
and the Optionee for the grant of an option.
-6-
<PAGE>
(l) "Optionee" shall mean a person to whom a stock option is granted
under this Plan or any person who succeeds to the rights of such person
under this Plan by reason of the death of such person.
(m) "Parent" shall mean a "parent corporation" as defined in Section
425(e) and (g) of the Code.
(n) "Plan" shall mean this Directors' Stock Option Plan for the
Company.
(o) "Share(s)" shall mean a share or shares of the Common Stock.
(p) "Subsidiary" shall mean any corporation (other than the Company)
in any unbroken chain of corporations beginning with the Company if, at the
time of the granting of the Option, each of the corporations other than the
last corporation in the unbroken chain owns stock possessing 50 percent or
more of the total combined voting power of all classes of stock in one of
the other corporations in such chain.
3. SHARES AND OPTIONS. Subject to Section 9 of this Plan, the Company
------------------
may grant to Optionees from time to time Options to purchase an aggregate of up
to one hundred thousand (100,000) shares from authorized and unissued Shares. If
any Option granted under the Plan shall terminate, expire, or be canceled or
surrendered as to any Shares, new Options may thereafter be granted covering
such Shares.
4. GRANTS OF OPTIONS.
-----------------
(a) On the Initial Grant Date, each Eligible Director shall receive
the grant of an Option to purchase 2,000 Shares.
(b) Each Eligible Director shall receive an annual grant of an Option
to purchase 2,000 Shares on each Annual Meeting Date, beginning with the
first Annual Meeting Date that occurs after December 31, 1996 and that is
after the Initial Grant Date for each such Eligible Director.
(c) Upon the grant of each Option, the Company and the Eligible
Director shall enter into an Option Agreement, which shall specify the
grant date and the exercise price and shall include or incorporate by
reference the substance of this Plan and such other provisions consistent
with this Plan as the Board may determine.
5. EXERCISE PRICE. The exercise price per Share of any Option shall be
--------------
the Fair Market Value of the Shares underlying such Option on the date such
Option is granted.
6. EXERCISE OF OPTIONS. An Option shall be deemed exercised when (i)
-------------------
the Company has received written notice of such exercise in accordance with the
terms of the Option, (ii) full payment of the aggregate exercise price of the
Shares as to which the Option is exercised has been made, and (iii) arrangements
that are satisfactory to the Board in its sole discretion have been made for the
Optionee's payment to the Company of the amount that is necessary for the
Company or Subsidiary employing the Optionee to withhold in accordance with
applicable Federal or State tax withholding requirements. The exercise price of
any Shares purchased shall be paid in cash, by certified or official bank check
or personal check, by money order, with Shares or by a combination of the above.
If the exercise price is paid in whole or in part with Shares, the value of the
Shares surrendered shall be their Fair Market Value on the date the Option is
exercised. No Optionee shall be deemed to be a holder of any Shares subject to
an Option unless and until a stock certificate or certificates for such Shares
are issued to such person(s) under the terms of the Plan. No adjustment shall be
made for dividends (ordinary or extraordinary, whether in cash, securities or
other property) or distributions or other rights for which the record date is
prior to the date such stock certificate is issued, except as expressly provided
in Section 9 hereof.
7. EXERCISE SCHEDULE FOR OPTIONS. Each Option granted hereunder shall
-----------------------------
not be exercisable until after six months following the date of grant of the
Option to the Eligible Director. Thereafter, such Option shall be exercisable in
full. The expiration date of an Option shall be 10 years from the date of grant
of the Option.
-7-
<PAGE>
8. TERMINATION OF OPTION PERIOD.
----------------------------
(a) The unexercised portion of any Option shall automatically and
without notice terminate and become null and void at the time of the
earliest to occur of the following:
(i) three months after the date on which the Optionee ceases to
be a Director for any reason other than by reason of (A) "Cause"
(which, for purposes of this Plan, shall mean the removal of the
Optionee as a Director by reason of any act of (1) fraud or
intentional misrepresentation, or (2) embezzlement, misappropriation,
or conversion of assets or opportunities of the Company or any
Subsidiary), or (B) death;
(ii) immediately upon the removal of the Optionee as a Director
for Cause;
(iii) one year after the date the Optionee ceases to be a
Director by reason of death of the Optionee;
(b) The Board in its sole discretion may, by giving written notice
("Cancellation Notice"), cancel any Option that remains unexercised on the
date of the consummation of any corporate transaction:
(i) if the shareholders of the Company shall approve a plan of
merger, consolidation, reorganization, liquidation or dissolution in
which the Company does not survive (unless the approved merger,
consolidation, reorganization, liquidation or dissolution is
subsequently abandoned); or
(ii) if the shareholders of the Company shall approve a plan for
the sale, lease, exchange or other disposition of all or substantially
all the property and assets of the Company (unless such plan is
subsequently abandoned).
Any Cancellation Notice shall be given a reasonable period of time prior to
the proposed date of such cancellation and may be given either before or
after shareholder approval of such corporate transaction.
9. ADJUSTMENT OF SHARES.
--------------------
(a) If at any time while the Plan is in effect or unexercised Options
are outstanding, there shall be any increase or decrease in the number of
issued and outstanding Shares through the declaration of a stock dividend
or through any recapitalization resulting in a stock split-up, combination
or exchange of Shares, then and in such event:
(i) appropriate adjustment shall be made in the maximum number
of Shares available for grant under the Plan, so that the same
percentage of the Company's issued and outstanding Shares shall
continue to be subject to being so optioned; and
(ii) appropriate adjustment shall be made in the number of
Shares and the exercise price per Share thereof then subject to any
outstanding Option, so that the same percentage of the Company's
issued and outstanding Shares shall remain subject to purchase at the
same aggregate exercise price.
(b) Subject to the specific terms of any Option, the Board may change
the terms of Options outstanding under this Plan, with respect to the
exercise price or the number of Shares subject to the Options, or both,
when, in the Board's sole discretion, such adjustments become appropriate
by reason of a corporate transaction described in Subsections 8(b)(i) or
(ii) hereof.
(c) Except as otherwise expressly provided herein, the issuance by the
Company of shares of its capital stock of any class, or securities
convertible into shares of capital stock of any class, either in connection
with a direct sale or upon the exercise of rights or warrants to subscribe
therefor, or upon conversion of shares or obligations of the Company
convertible into such shares or other securities, shall not affect, and no
adjustment by reason thereof shall be made with respect to, the number or
exercise price of the Shares then subject to outstanding Options granted
under the Plan.
-8-
<PAGE>
(d) Without limiting the generality of the foregoing, the existence of
outstanding Options granted under the Plan shall not affect in any manner
the right or power of the Company to make, authorize or consummate (i) any
or all adjustments, recapitalizations, reorganizations or other changes in
the Company's capital structure or its business; (ii) any merger or
consolidation of the Company; (iii) any issue by the Company of debt
securities, or preferred or preference stock that would rank above the
Shares subject to outstanding Options; (iv) the dissolution or liquidation
of the Company; (v) any sale, transfer or assignment of all or any part of
the assets or business of the Company; or (vi) any other corporate act or
proceeding, whether of a similar character or otherwise.
10. TRANSFERABILITY OF OPTIONS. Each Option shall provide that such
--------------------------
Option shall not be transferable by the Optionee otherwise than by will or the
laws of descent and distribution, and each Option shall be exercisable during
the Optionee's lifetime only by the Optionee.
11. ISSUANCE OF SHARES. As a condition of any sale or issuance of Shares
------------------
upon exercise of any Option, the Board may require such agreements or
undertakings, if any, as the Board may deem necessary or advisable to assure
compliance with any such law or regulation including, but not limited to, the
following:
(a) a representation and warranty by the Optionee to the Company, at
the time any Option is exercised, that he is acquiring the Shares to be
issued to him for investment and not with a view to, or for sale in
connection with, the distribution of any such Shares; and
(b) a representation, warranty and/or agreement to be bound by any
legends that are, in the opinion of the Board, necessary or appropriate to
comply with the provisions of any securities law deemed by the Board to be
applicable to the issuance of the Shares and are endorsed upon the Share
certificates.
12. ADMINISTRATION OF THE PLAN. The Plan shall be administered by the
--------------------------
Board, which shall have the authority to adopt such rules and regulations and to
make such determinations as are not inconsistent with the Plan and as are
necessary or desirable for the implementation and administration of the Plan.
13. INTERPRETATION. If any provision of the Plan should be held invalid
--------------
or illegal for any reason, such determination shall not affect the remaining
provisions hereof, but instead the Plan shall be construed and enforced as if
such provision had never been included in the Plan. The determinations and the
interpretation and construction of any provision of the Plan by the Board shall
be final and conclusive. This Plan shall be governed by the laws of the State of
Florida. Headings contained in this Plan are for convenience only and shall in
no manner be construed as part of this Plan. Any reference to the masculine,
feminine, or neuter gender shall be a reference to such other gender as is
appropriate.
14. TERM OF PLAN; AMENDMENT AND TERMINATION OF THE PLAN.
---------------------------------------------------
(a) This Plan shall become effective upon its adoption by the Board,
and shall continue in effect until all Options granted hereunder have
expired or been exercised, unless sooner terminated under the provisions
relating thereto. No Option shall be granted after 10 years from the date
of the Board's adoption of this Plan.
(b) The Board may from time to time amend the Plan or any Option;
provided, however, that, without approval by the Company's shareholders, no
such amendment shall (i) materially increase the benefits accruing to
participants under the Plan, (ii) materially increase the number of Shares
or other securities reserved for issuance upon the exercise of Options,
(iii) materially modify the requirements as to eligibility for
participation under the Plan or (iv) otherwise involve any other change or
modification requiring shareholder approval under Rule 16b-3 of the
Securities Act of 1933, as amended; and, provided, further, that, except to
the extent otherwise specifically provided in Section 8, no amendment or
suspension of the Plan or any Option issued hereunder shall substantially
impair any Option previously granted to any Optionee without the consent of
such Optionee.
(c) Notwithstanding anything else contained herein, the provisions of
this Plan which govern the number of Options to be awarded to nonemployee
directors, the exercise price per share under each such Option, when and
under what circumstances an Option will be granted and the period within
which each Option may be exercised, shall not be amended more than once
every six months (even with shareholder approval), other than to conform to
changes to the Code, or the rules promulgated thereunder, and under the
Employee Retirement Income
-9-
<PAGE>
Security Act of 1974, as amended, or the rules promulgated thereunder, or
with rules promulgated by the Securities and Exchange Commission.
(d) The Board, without further approval of the Company's shareholders,
may at any time terminate or suspend this Plan. Any such termination or
suspension of the Plan shall not affect Options already granted and such
Options shall remain in full force and effect as if this Plan had not been
terminated or suspended. No Option may be granted while the Plan is
suspended or after it is terminated. The rights and obligations under any
Option granted to any Optionee while this Plan is in effect shall not be
altered or impaired by the suspension or termination of this Plan without
the consent of such Optionee.
15. Reservation of Shares. The Company, during the term of the Plan, will
---------------------
at all times reserve and keep available a number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
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<PAGE>
AMENDMENT NO. 1 TO
VACATION BREAK U.S.A., INC.
DIRECTORS' STOCK OPTION PLAN
-----------------------------------------
THIS AMENDMENT NO. 1 to the Vacation Break U.S.A., Inc. Directors' Stock
Option Plan (this "Amendment") is made as of the 19th day of December, 1997, by
Vacation Break U.S.A., Inc., a Florida corporation ("Vacation Break").
W I T N E S S E T H :
WHEREAS, effective as of May 15, 1996, the Board of Directors of Vacation
Break (the "Vacation Break Board") adopted the Vacation Break U.S.A., Inc.
Directors' Stock Option Plan (the "Plan");
WHEREAS, Vacation Break has entered into an Agreement and Plan of Merger,
dated as of August 8, 1997 (the "Merger Agreement"), among Fairfield
Communities, Inc., a Delaware corporation ("Fairfield"), FCVB Corp., a Florida
corporation and wholly owned subsidiary of Fairfield ("Merger Sub"), and
Vacation Break;
WHEREAS, pursuant to the Merger Agreement, among other things, (i) Merger
Sub will be merged with and into Vacation Break, with Vacation Break as the
surviving corporation (the "Merger"), (ii) each issued and outstanding share of
common stock, $.01 par value per share ("Vacation Break Common Stock"), of
Vacation Break will be converted into the right to receive .6075 (the "Exchange
Ratio") of a share of common stock, par value $.01 per share ("Fairfield Common
Stock"), of Fairfield, and (iii) Fairfield will assume each outstanding option
to purchase shares of Vacation Break Common Stock previously granted under the
Plan (each an "Option");
WHEREAS, each Option assumed by Fairfield will be deemed to constitute an
option to acquire Fairfield Common Stock on the terms and conditions described
in the Merger Agreement;
WHEREAS, the Vacation Break Board desires to amend the Plan in order to
adjust the terms of all outstanding Options granted under the Plan to provide
that, at the effective time of the Merger (the "Effective time"), each Option
outstanding immediately prior to the Effective Time will be deemed to constitute
an option to acquire Fairfield Common Stock on the terms and conditions
described in the Merger Agreement, and to provide for the other matters set
forth herein in order to give effect to the Merger;
NOW, THEREFORE, effective as of the Effective Time, the Plan is hereby
amended as follows, subject only to the condition that the Effective Time
occurs:
1. ASSUMED OPTIONS AND SHARES. Each Option assumed by Fairfield shall
--------------------------
constitute an option to acquire, on the same terms and conditions as were
applicable under such Option, the number of shares of Fairfield Common Stock
rounded up or down to the nearest whole share equal to the product of the
Exchange Ratio multiplied by the number of shares of Vacation Break Common Stock
subject to such Option immediately prior to the Effective Time, at a price per
share equal to the aggregate exercise price for the shares of Vacation Break
Common Stock subject to such Option divided by the number of shares of Fairfield
Common Stock deemed to be purchasable pursuant to such Option ("Assumed
Options"); provided that the conversion of any Option into an Assumed Option
with an exercise price less than $.01 per share of Fairfield Common Stock will
be subject to the Optionee's agreement that upon exercise, (x) to the extent
Fairfield is holding Fairfield Common Stock as treasury shares that are not
reserved for any other purpose, Fairfield shall issue the appropriate number of
such treasury shares to the Optionee and (x) to the extent that no such treasury
shares are available, such Optionee shall pay an exercise price of $.01 per
share of Fairfield Common Stock. Subject to the proviso contained in the
preceding sentence, shares of Fairfield Common will be made available for
issuance upon exercise of Assumed Options from authorized but unissued shares of
Fairfield Common Stock.
2. EXERCISE OF ASSUMED OPTIONS. From and after the Effective Time the
---------------------------
Assumed Options shall be vested and fully exercisable in accordance with their
terms. A holder of an Assumed Option may exercise such Assumed Option in whole
or in part in accordance with its terms by delivering a properly executed notice
of exercise to Fairfield, together with the consideration therefor and the
federal withholding tax information required in accordance with the Plan.
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<PAGE>
3. TRANSFERABILITY OF ASSUMED OPTIONS. All restrictions or limitations
----------------------------------
on transfer and vesting with respect to Options awarded under the Plan, to the
extent that such restrictions or limitations shall not have already lapsed,
shall remain in full force and effect with respect to the Assumed Options.
4. ADMINISTRATION OF THE PLAN. The Plan as amended hereby (the "Amended
--------------------------
Plan") shall be administered by the Compensation Committee of the Board of
Directors of Fairfield (the "Compensation Committee") and the Board of Directors
of Fairfield (the "Fairfield Board"). The Compensation Committee and the
Fairfield Board shall have the full authority and discretion to administer the
Amended Plan and to take any action that is necessary or advisable in connection
with the administration of the Amended Plan, including without limitation the
authority and discretion to interpret and construe any provision of the Amended
Plan or of any agreement, notification or document evidencing the grant of an
Option or an Assumed Option. The interpretation and construction by the
Compensation Committee or the Fairfield Board, as applicable, of any such
provision or of any agreement, notification or document and any determination by
the Compensation Committee or the Fairfield Board pursuant to any provision of
the Amended Plan or of any such agreement, notification or document will be
final and conclusive; provided that if the Compensation Committee disagrees with
the Fairfield Board with respect to any such interpretation, instruction or
determination, the Fairfield Board's determination will be final and conclusive
except with respect to Assumed Options intended to comply with Section 162(m) of
the Code. In furtherance and without limiting the generality of the foregoing,
all power, authority and discretion to adjust, modify, amend, terminate or
otherwise change the terms of Options or the Plan formerly vested in the
Vacation Break Board or the stock option committee thereof appointed by the
Vacation Break Board pursuant to the Plan shall be vested in the Fairfield Board
and the Compensation Committee with respect to Assumed Options and the Amended
Plan.
5. CERTAIN DEFINITIONS AND INTERPRETIVE MATTERS.
--------------------------------------------
(a) In order to give effect to the Merger, the terms of the Merger
Agreement regarding Assumed Options, and this Amendment, for purposes of
the Amended Plan the following terms, when used in the sections of the Plan
indicated below, shall have the following meanings:
(i) "Company" shall mean Fairfield or Vacation Break when used
in Section 8(a)(i) and shall mean Fairfield when used in Sections 6,
8(b), 9, 11 and 14(b) of the Plan;
(ii) "Board" shall mean the Compensation Committee or the
Fairfield Board, as applicable, when used in Sections 6, 8(b), 9(b),
and 14(b) of the Plan;
(iii) "Option" shall mean "Assumed Option" when used in Sections
6, 8, 9, 10, 11 and 14(b) of the Plan.
(b) The terms and provisions of the Plan shall be liberally construed
to give effect to the Merger, the terms of the Merger Agreement regarding
Assumed Options and this Amendment.
(c) Except as amended or modified hereby or inconsistent with Section
5(b) of this Amendment, the terms and conditions of the Plan shall remain
in full force and effect.
EXECUTED as of December 18, 1997
VACATION BREAK USA, INC.
By: /s/ Ralph P. Muller
------------------------
Ralph P. Muller
Chairman of the Board and
Chief Executive Officer
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<PAGE>
Exhibit 4.5
-----------
VACATION BREAK U.S.A., INC.
-------------------------------
1995 STOCK OPTION PLAN
-------------------------------
1. PURPOSE. The purpose of this Plan is to advance the interests of
-------
VACATION BREAK U.S.A., INC., a Florida corporation (the "Company"), by providing
an additional incentive to attract and retain qualified and competent persons
who are key employees and directors of the Company, and upon whose efforts and
judgment the success of the Company is largely dependent, through the
encouragement of stock ownership in the Company by such persons.
2. DEFINITIONS. As used herein, the following terms shall have the
-----------
meaning indicated:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Committee" shall mean the stock option committee appointed by the
Board pursuant to Section 13 hereof or, if not appointed, the Board.
(c) "Common Stock" shall mean the Company's Common Stock, par value
$0.01 per share.
(d) "Director" shall mean a member of the Board.
(e) "Disinterested Person" shall mean a Director who is not, during
the one year prior to his or her service as an administrator of this Plan,
or during such service, granted or awarded equity securities pursuant to
this Plan or any other plan of the Company or any of its affiliates, except
that:
(i) participation in a formula plan meeting the conditions in
paragraph (c)(2)(ii) of Rule 16b-3 promulgated under the Securities
Exchange Act shall not disqualify a Director from being a
Disinterested Person;
(ii) participation in an ongoing securities acquisition plan
meeting the conditions in paragraph (d)(2)(i) of Rule 16b-3
promulgated under the Securities Exchange Act shall not disqualify a
Director from being a Disinterested Person; and
(iii) an election to receive an annual retainer fee in either
cash or an equivalent amount of securities, or partly in cash and
partly in securities, shall not disqualify a Director from being a
Disinterested Person.
(f) "Fair Market Value" of a Share on any date of reference shall be
the "Closing Price" (as defined below) of the Common Stock on the business
day immediately preceding such date, unless the Committee in its sole
discretion shall determine otherwise in a fair and uniform manner. For the
purpose of determining Fair Market Value, the "Closing Price" of the Common
Stock on any business day shall be (i) if the Common Stock is listed or
admitted for trading on any United States national securities exchange, or
if actual transactions are otherwise reported on a consolidated transaction
reporting system, the last reported sale price of Common Stock on such
exchange or reporting system, as reported in any newspaper of general
circulation, (ii) if the Common Stock is quoted on the National Association
of Securities Dealers Automated Quotations System ("NASDAQ"), or any
similar system of automated dissemination of quotations of securities
prices in common use, the mean between the closing high bid and low asked
quotations for such day of Common Stock on such system, or (iii) if neither
clause (i) or (ii) is applicable, the mean between the high bid and low
asked quotations for the Common Stock as reported by the National Quotation
Bureau, Incorporated if at least two securities dealers have inserted both
bid and asked quotations for Common Stock on at least five of the ten
preceding days.
<PAGE>
(g) "Incentive Stock Option" shall mean an incentive stock option as
defined in Section 422 of the Internal Revenue Code.
(h) "Internal Revenue Code" shall mean the Internal Revenue Code of
1986, as amended from time to time.
(i) "Non-Statutory Stock Option" shall mean an Option which is not an
Incentive Stock Option.
(j) "Officer" shall mean the Company's president, principal financial
officer, principal accounting officer and any other person who the Company
identifies as an "executive officer" for purposes of reports or proxy
materials filed by the Company pursuant to the Securities Exchange Act.
(k) "Option" (when capitalized) shall mean any option granted under
this Plan.
(l) "Optionee" shall mean a person to whom a stock option is granted
under this Plan or any person who succeeds to the rights of such person
under this Plan by reason of the death of such person.
(m) "Plan" shall mean this Stock Option Plan for the Company.
(n) "Securities Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended.
(o) "Share(s)" shall mean a share or shares of the Common Stock.
3. SHARES AND OPTIONS. The Company may grant to Optionees from time to
------------------
time Options to purchase an aggregate of up to Six Hundred Thousand (600,000)
Shares from Shares held in the Company's treasury or from authorized and
unissued Shares. If any Option granted under the Plan shall terminate, expire,
or be canceled or surrendered as to any Shares, new Options may thereafter be
granted covering such Shares. An Option granted hereunder shall be either an
Incentive Stock Option or a Non-Statutory Stock Option as deter- mined by the
Committee at the time of grant of such Option and shall clearly state whether it
is an Incentive Stock Option or Non- Statutory Stock Option. All Incentive
Stock Options shall be granted within ten years from the effective date of this
Plan.
4. DOLLAR LIMITATION. Options otherwise qualifying as Incentive Stock
-----------------
Options hereunder will not be treated as Incentive Stock Options only to the
extent that the aggregate fair market value (determined at the time the Option
is granted) of the Shares, with respect to which Options meeting the
requirements of Internal Revenue Code Section 422(b) are exercisable for the
first time by any individual during any calendar year (under all plans of the
Company), exceeds $100,000.
5. CONDITIONS FOR GRANT OF OPTIONS.
-------------------------------
(a) Each Option shall be evidenced by an option agreement that may
contain any term deemed necessary or desirable by the Committee, provided
such terms are not inconsistent with this Plan or any applicable law.
Optionees shall be those persons selected by the Committee from the class
of all regular employees of the Company (including Officers) and Directors
of the Company, as well as consultants and independent contractors. Any
person who files with the Committee, in a form satisfactory to the
Committee, a written waiver of eligibility to receive any Option under this
Plan shall not be eligible to receive any Option under this Plan for the
duration of such waiver.
(b) In granting Options, the Committee may take into consideration the
contribution the person has made to the success of the Company and such
other factors as the Committee shall determine. The Committee shall also
have the authority to consult with and receive recommendations from
officers and other personnel of the Company with regard to these matters.
The Committee may from time to time in granting Options under the Plan
prescribe such other terms and conditions concerning such Options as it
deems appropriate, including, without limitation, (i) prescribing the date
or dates on which the Option becomes exercisable, (ii) providing that the
Option rights accrue or become exercisable in installments over a period of
years, or upon the attainment of stated goals or both, or (iii) relating an
Option to the continued employment of the Optionee for a specified period
of time,
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<PAGE>
provided that such terms and conditions are not more favorable to an
Optionee than those expressly permitted herein.
(c) The Options granted to employees under this Plan shall be in
addition to regular salaries, pension, life insurance or other benefits
related to their employment with the Company. Neither the Plan nor any
Option granted under the Plan shall confer upon any person any right to
employment or continuance of employment by the Company.
(d) Notwithstanding any other provision of this Plan, and in addition
to any other requirements of this Plan, Options may not be granted to a
Director or Officer unless the grant of such Options is authorized by, and
all of the terms of such Options are determined by, a Committee that is
appointed in accordance with Section 13 of this Plan and all of whose
members are Disinterested Persons.
(e) Notwithstanding any other provision of this Plan, no Options may
be granted to Ralph P. Muller, the Company's Chairman of the Board and
Chief Executive Officer, under this Plan.
6. OPTION PRICE. The option price per Share of any Option shall be any
------------
price determined by the Committee but shall not be less than the par value per
Share; provided, however, that in no event shall the option price per Share of
any Incentive Stock Option be less than the Fair Market Value of the Shares
underlying such Option on the date such Option is granted.
7. EXERCISE OF OPTIONS. An Option shall be deemed exercised when (i) the
-------------------
Company has received written notice of such exercise in accordance with the
terms of the Option, (ii) full payment of the aggregate option price of the
Shares as to which the Option is exercised has been made, and (iii) arrangements
that are satisfactory to the Committee in its sole discretion have been made for
the Optionee's payment to the Company of the amount that is necessary for the
Company employing the Optionee to withhold in accordance with applicable Federal
or state tax withholding requirements. Unless further limited by the Committee
in any Option, the option price of any Shares purchased shall be paid in cash,
by certified or official bank check, by money order, with Shares or by a
combination of the above; provided further, however, that the Committee in its
sole discretion may accept a personal check in full or partial payment of any
Shares. If the exercise price is paid in whole or in part with Shares, the
value of the Shares surrendered shall be their Fair Market Value on the date the
Option is exercised. The Company in its sole discretion may, on an individual
basis or pursuant to a general program established by the Committee in
connection with this Plan, lend money to an Optionee to exercise all or a
portion of an Option granted hereunder. If the exercise price is paid in whole
or part with an Optionee's promissory note, such note shall (i) provide for full
recourse to the maker, (ii) be collateralized by the pledge of the Shares that
the Optionee purchases upon exercise of such Option, (iii) bear interest at a
rate no less than the rate of interest payable by the Company to its principal
lender, and (iv) contain such other terms as the Committee in its sole
discretion shall require. No Optionee shall be deemed to be a holder of any
Shares subject to an Option unless and until a stock certificate or certificates
for such Shares are issued to such person(s) under the terms of this Plan. No
adjustment shall be made for dividends (ordinary or extraordinary, whether in
cash, securities or other property) or distributions or other rights for which
the record date is prior to the date such stock certificate is issued, except as
expressly provided in Section 10 hereof.
8. EXERCISABILITY OF OPTIONS. Any Option shall become exercisable in such
-------------------------
amounts, at such intervals and upon such terms as the Committee shall provide in
such Option, except as otherwise provided in this Section 8.
(a) The expiration date of an Option shall be determined by the
Committee at the time of grant, but in no event shall an Option be
exercisable after the expiration of ten years from the date of grant of the
Option.
(b) Unless otherwise provided in any Option, each outstanding Option
shall become immediately fully exercisable:
(i) if there occurs any transaction (which shall include a
series of transactions occurring within 60 days or occurring pursuant
to a plan), that has the result that share- holders of the Company
immediately before such transaction cease to own at least 51 percent
of the voting stock of the Company or of any entity that results from
the participation of the Company in a reorganization, consolidation,
merger, liquidation or any other form of corporate transaction;
-15-
<PAGE>
(ii) if the shareholders of the Company shall approve a plan of
merger, consolidation, reorganization, liquidation or dissolution in
which the Company does not survive (unless the approved merger,
consolidation, reorganization, liquidation or dissolution is
subsequently abandoned); or
(iii) the shareholders of the Company shall approve a plan for
the sale, lease, exchange or other disposition of all or substantially
all the property and assets of the Company (unless such plan is
subsequently abandoned).
(c) The Committee may in its sole discretion accelerate the date on
which any Option may be exercised and may accelerate the vesting of any
Shares subject to any Option or previously acquired by the exercise of any
Option.
(d) Options granted to Officers and Directors shall not be exercisable
until the expiration of a period of at least six months following the date
of grant.
9. TERMINATION OF OPTION PERIOD.
----------------------------
(a) Unless otherwise determined by the Committee in its sole
discretion upon the grant of any Non-Statutory Stock Option, the
unexercised portion of any Option shall automatically and without notice
terminate and become null and void at the time of the earliest to occur of
the following:
(i) three months after the date on which the Optionee's
employment is terminated or, in the case of a Non-Statutory Stock
Option, and unless the Committee shall otherwise determine in writing
in its sole discretion, the date on which the Optionee's employment is
terminated, either case for any reason other than by reason of (A)
Cause, which, solely for purposes of this Plan, shall mean the
termination of the Optionee's employment by reason of the Optionee's
wilful misconduct or gross negligence, (B) a mental or physical
disability as determined by a medical doctor satisfactory to the
Committee, or (C) death;
(ii) immediately upon the termination of the Optionee's
employment for Cause;
(iii) one year after the date on which the Optionee's employment
is terminated by reason of a mental or physical disability (within the
meaning of Internal Revenue Code Section 22(e)) as determined by a
medical doctor satisfactory to the Committee; or
(iv) (A) twelve months after the date of termination of the
Optionee's employment by reason of death of the employee, or (B) three
months after the date on which the Optionee shall die if such death
shall occur during the one year period specified in Sub- section
9(a)(iii) hereof.
(b) The Committee in its sole discretion may by giving written notice
("cancellation notice") cancel, effective upon the date of the consummation
of any corporate transaction described in Subsections 8(b)(ii) or (iii)
hereof, any Option that remains unexercised on such date. Such
cancellation notice shall be given a reasonable period of time prior to the
proposed date of such cancellation and may be given either before or after
approval of such corporate transaction.
10. ADJUSTMENT OF SHARES.
--------------------
(a) If at any time while the Plan is in effect or unexercised Options
are outstanding, there shall be any increase or decrease in the number of
issued and outstanding Shares through the declaration of a stock dividend
or through any recapitalization resulting in a stock split-up, combination
or exchange of Shares, then and in such event:
(i) appropriate adjustment shall be made in the maximum number
of Shares available for grant under the Plan, so that the same
percentage of the Company's issued and outstanding Shares shall
continue to be subject to being so optioned; and
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<PAGE>
(ii) appropriate adjustment shall be made in the number of
Shares and the exercise price per Share thereof then subject to any
outstanding Option, so that the same percentage of the Company's
issued and outstanding Shares shall remain subject to purchase at the
same aggregate exercise price.
(b) Subject to the specific terms of any Option, the Committee may
change the terms of Options outstanding under this Plan, with respect to
the option price or the number of Shares subject to the Options, or both,
when, in the Committee's sole discretion, such adjustments become
appropriate by reason of a corporate transaction described in Subsections
8(b)(ii) or (iii) hereof.
(c) Except as otherwise expressly provided herein, the issuance by the
Company of shares of its capital stock of any class, or securities
convertible into shares of capital stock of any class, either in connection
with direct sale or upon the exercise of rights or warrants to subscribe
therefor, or upon conversion of shares or obligations of the Company
convertible into such shares or other securities, shall not affect, and no
adjustment by reason thereof shall be made with respect to the number of or
exercise price of Shares then subject to outstanding Options granted under
the Plan.
(d) Without limiting the generality of the foregoing, the existence of
outstanding Options granted under the Plan shall not affect in any manner
the right or power of the Company to make, authorize or consummate (i) any
or all adjustments, recapitalizations, reorganizations or other changes in
the Company's capital structure or its business; (ii) any merger or
consolidation of the Company; (iii) any issue by the Company of debt
securities, or preferred or preference stock that would rank above the
Shares subject to outstanding Options; (iv) the dissolution or liquidation
of the Company; (v) any sale, transfer or assignment of all or any part of
the assets or business of the Company; or (vi) any other corporate act or
proceeding, whether of a similar character or otherwise.
11. TRANSFERABILITY OF OPTIONS. Each Option shall provide that such
--------------------------
Option shall not be transferable by the Optionee other- wise than by will or the
laws of descent and distribution, and each Option shall be exercisable during
the Optionee's lifetime only by the Optionee.
12. ISSUANCE OF SHARES. As a condition of any sale or issuance of Shares
------------------
upon exercise of any Option, the Committee may require such agreements or
undertakings, if any, as the Committee may deem necessary or advisable to assure
compliance with any such law or regulation including, but not limited to, the
following:
(a) a representation and warranty by the Optionee to the Company, at
the time any Option is exercised, that he is acquiring the Shares to be
issued to him for investment and not with a view to, or for sale in
connection with, the distribution of any such Shares; and
(b) a representation, warranty and/or agreement to be bound by any
legends that are, in the opinion of the Committee, necessary or appropriate
to comply with the provisions of any securities law deemed by the Committee
to be applicable to the issuance of the Shares and are endorsed upon the
Share certificates.
13. ADMINISTRATION OF THE PLAN.
--------------------------
(a) The Plan shall be administered by the Committee, which shall
consist of not less than two Directors, each of whom shall be Disinterested
Persons to the extent required by Section 5(d) hereof. The Committee shall
have all of the powers of the Board with respect to the Plan. Any member
of the Committee may be removed at any time, with or without cause, by
resolution of the Board and any vacancy occurring in the membership of the
Committee may be filled by appointment by the Board.
(b) The Committee, from time to time, may adopt rules and regulations
for carrying out the purposes of the Plan. The Committee's determinations
and its interpretation and construction of any provision of the Plan shall
be final and conclusive.
(c) Any and all decisions or determinations of the Committee shall be
made either (i) by a majority vote of the members of the Committee at a
meeting or (ii) without a meeting by the unanimous written approval of the
members of the Committee.
-17-
<PAGE>
14. INCENTIVE OPTIONS FOR 10% SHAREHOLDERS. Notwithstanding any other
--------------------------------------
provisions of the Plan to the contrary, an Incentive Stock Option shall not be
granted to any person owning directly or indirectly (through attribution under
Section 424(d) of the Internal Revenue Code) at the date of grant, stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Company (or of its subsidiary (as defined in Section 424 of the
Internal Revenue Code) at the date of grant) unless the option price of such
Option is at least 110% of the Fair Market Value of the Shares subject to such
Option on the date the Option is granted, and such Option by its terms is not
exercisable after the expiration of five years from the date such Option is
granted.
15. INTERPRETATION.
--------------
(a) The Plan shall be administered and interpreted so that all
Incentive Stock Options granted under the Plan will qualify as Incentive
Stock Options under section 422 of the Internal Revenue Code. If any
provision of the Plan should be held invalid for the granting of Incentive
Stock Options or illegal for any reason, such determination shall not
affect the remaining provisions hereof, but instead the Plan shall be
construed and enforced as if such provision had never been included in the
Plan.
(b) This Plan shall be governed by the laws of the State of Florida.
(c) Headings contained in this Plan are for convenience only and shall
in no manner be construed as part of this Plan.
(d) Any reference to the masculine, feminine, or neuter gender shall
be a reference to such other gender as is appropriate.
16. AMENDMENT AND DISCONTINUATION OF THE PLAN. Either the Board or the
-----------------------------------------
Committee may from time to time amend the Plan or any Option; provided, however,
that, except to the extent provided in Section 10, no such amendment may,
without approval by the shareholders of the Company, (a) materially increase the
benefits accruing to participants under the Plan, (b) materially increase the
number of securities which may be issued under the Plan, or (c) materially
modify the requirements as to eligibility for participation in the Plan; and
provided further, that, except to the extent provided in Section 9, no amendment
or suspension of the Plan or any Option issued hereunder shall substantially
impair any Option previously granted to any Optionee without the consent of such
Optionee.
17. EFFECTIVE DATE AND TERMINATION DATE. The effective date of the Plan
-----------------------------------
is the date on which the Board adopts this Plan, and the Plan shall terminate on
the 10th anniversary of the effective date.
-18-
<PAGE>
AMENDMENT TO VACATION BREAK U.S.A., INC.
1995 STOCK OPTION PLAN
THIS AMENDMENT to the Vacation Break U.S.A., Inc. 1995 Stock Option Plan is
made as of this 8th day of August, 1996 by Vacation Break U.S.A., Inc.
W I T N E S S E T H
WHEREAS, effective as of June 14, 1995, VACATION BREAK U.S.A., INC. (the
"Company") adopted the VACATION BREAK U.S.A., INC. 1995 STOCK OPTION PLAN (the
"Plan"); and
WHEREAS, the Board of Directors of the Company (the "Board") desires to
amend the Plan in order to provide for, among other things, certain changes in
the manner in which options may be exercised by optionees;
WHEREAS, approval of the Company's shareholders is not required in order to
make said amendments to the Plan;
NOW, THEREFORE, effective as of August 8, 1996, the Plan is hereby amended
as follows:
1. OPERATIVE AMENDMENTS.
--------------------
(a) Section 7 of the Plan is hereby deleted in its entirety and the
following shall be inserted as new Section 7 of the Plan:
2. EXERCISE OF OPTIONS.
-------------------
(a) An Option shall be deemed exercised when (i) the Company has
received written notice of such exercise in accordance with the terms
of the Option, (ii) full payment of the aggregate option price of the
Shares as to which the Option is exercised has been made, and (iii)
arrangements that are satisfactory to the Committee in its sole
discretion have been made for the Optionee's payment to the Company of
the amount that is necessary for the Company employing the Optionee to
withhold in accordance with applicable Federal or state tax
withholding requirements.
(b) Unless further limited by the Committee in any Option, the option
price of any Shares purchased shall be paid in cash, by certified or
official bank check, by money order, with Shares or by a combination
of the above; provided further, however, that the Committee in its
sole discretion may accept a personal check in full or partial payment
of any Shares. If the exercise price is paid in whole or in part with
Shares, the value of the Shares surrendered shall be their Fair Market
Value on the date the Option is exercised. In addition, full payment
for any Shares purchased may be effected through a broker-dealer sale
and remittance procedure pursuant to which the Optionee shall
concurrently provide irrevocable written instructions (i) to the
Company designated brokerage firm to effect the immediate sale of the
purchased Shares and remit to the Company, out of the sale proceeds
available on the settlement date, sufficient funds to satisfy in full
the aggregate option price payable for the purchased Shares plus all
applicable Federal, state and local income and employment taxes
required to be withheld in connection with such purchase and (ii) to
the Company to deliver the certificates for the purchased Shares
directly to such brokerage firm in order to complete the sale
transaction. Additionally, the Company in its sole discretion may, on
an individual basis or pursuant to a general program established by
the Committee in connection with this Plan, lend money to an Optionee
to exercise all or a portion of an Option granted hereunder. If the
exercise price is paid in whole or part with an Optionee's promissory
note, such note shall (i) provide for full recourse to the maker,
(ii) be collateralized by the pledge of the Shares that the Optionee
purchases upon exercise of such Option, (iii) bear interest at a rate
no less than the rate of interest payable by the Company to its
principal lender, and (iv) contain such other terms as the Committee
in its sole discretion shall require.
(c) No Optionee shall be deemed to be a holder of any Shares subject
to an Option unless and until a stock certificate or certificates for
such Shares are issued to such person(s) under the terms of this Plan.
-19-
<PAGE>
No adjustment shall be made for dividends (ordinary or extraordinary,
whether in cash, securities or other property) or distributions or
other rights for which the record date is prior to the date such stock
certificate is issued, except as expressly provided in Section 10
hereof.
(d) Section 9(a) of the Plan is hereby deleted in its entirety and the
following shall be inserted as new Section 9(a) of the Plan:
3. TERMINATION OF OPTION PERIOD.
----------------------------
(a) The unexercised portion of any Option shall automatically and
without notice terminate and become null and void at the time of the
earliest to occur of the following:
(i) three months after the date on which the Optionee's
employment is terminated for any reason other than by reason of
(A) Cause, which, solely for purposes of this Plan, shall mean
the termination of the Optionee's employment by reason of the
Optionee's wilful misconduct or gross negligence, (B) a mental or
physical disability as determined by a medical doctor
satisfactory to the Committee, or (C) death;
(ii) immediately upon the termination of the Optionee's
employment for Cause;
(iii) twelve months after the date on which the Optionee's
employment is terminated by reason of a mental or physical
disability (within the meaning of Section 22(e) of the Code) as
determined by a medical doctor satisfactory to the Committee;
(iv) (A) twelve months after the date of termination of the
Optionee's employment by reason of death of the employee, or (B)
three months after the date on which the Optionee shall die if
such death shall occur during the one year period specified in
Subsection 9(a)(iii) hereof.
4. OTHER TERMS AND PROVISIONS. Except as otherwise specifically
--------------------------
amended hereunder, all other terms and conditions of the Plan shall
remain in full force and effect. Unless otherwise expressly stated
herein to the contrary, all capitalized terms used herein shall have
the meanings ascribed to them in the Plan.
-20-
<PAGE>
AMENDMENT NO. 1 TO
VACATION BREAK U.S.A. INC.'S
1995 STOCK OPTION PLAN
THIS AMENDMENT is made as of the 8th day of May., 1997 with respect to the
1995 Stock Option Plan (the "Option Plan") of Vacation Break U.S.A., Inc. (the
"Company").
TERMS
WHEREAS, the Board of Directors of the Company believes it is to be in the
best interests of the Company and its shareholders to increase the number of
shares of Company common stock available for issuance under the Option Plan from
600,000 to 830,000 in order to provide additional incentives to designated
employees of the Company;
NOW, THEREFORE, effective as of the date first set forth above, the Option
Plan is hereby amended as follows:
ARTICLE I.
1.1 AMENDMENT TO SECTION 3. Section 3 of the Option Plan is hereby
----------------------
amended in its entirety and replaced by the following.
SHARES AND OPTIONS. The Company may grant to Optionees from time to
------------------
time Options to purchase an aggregate of up to Eight Hundred and Thirty thousand
(830,000) Shares from Shares held in the Company's treasury or from authorized
and unissued Shares. If any Option granted under the Plan shall terminate,
expire, or be canceled or surrendered as to any Shares, new Options may
thereafter be granted covering such Shares. An Option granted hereunder shall
be either an Incentive Stock Option or a Non-Statutory Stock Option as
determined by the Committee at the time of grant of such Option and shall
clearly state whether it is an Incentive Stock Option or Non-Statutory Stock
Option. All Incentive Stock Options shall be granted within ten years from the
effective date of this Plan.
ARTICLE II
2.1 EFFECT OF AMENDMENT. Except as expressly provided in Article I of
-------------------
this Amendment, nothing shall affect or be deemed to affect any provisions of
the Option Plan.
2.2 GOVERNING LAW. This Amendment shall be governed by and construed in
-------------
accordance with the internal laws of the State of Florida without giving effect
to principles of conflicts of laws.
BY ORDER OF THE BOARD OF DIRECTORS
-21-
<PAGE>
AMENDMENT NO. 2 TO
VACATION BREAK U.S.A., INC.
1995 STOCK OPTION PLAN
----------------------------------
THIS AMENDMENT NO. 2 to the Vacation Break U.S.A., Inc. 1995 Stock Option
Plan (this "Amendment") is made as of the 19th day of December, 1997, by
Vacation Break U.S.A., Inc., a Florida corporation ("Vacation Break").
W I T N E S S E T H :
WHEREAS, effective as of December 27, 1995, the Board of Directors of
Vacation Break (the "Vacation Break Board") adopted the Vacation Break U.S.A.,
Inc. 1995 Stock Option Plan, which the Vacation Break Board amended by an
amendment (as so amended, the "Plan");
WHEREAS, Vacation Break has entered into an Agreement and Plan of Merger,
dated as of August 8, 1997 (the "Merger Agreement"), among Fairfield
Communities, Inc., a Delaware corporation ("Fairfield"), FCVB Corp., a Florida
corporation and wholly owned subsidiary of Fairfield ("Merger Sub"), and
Vacation Break;
WHEREAS, pursuant to the Merger Agreement, among other things, (i) Merger
Sub will be merged with and into Vacation Break, with Vacation Break as the
surviving corporation (the "Merger"), (ii) each issued and outstanding share of
common stock, $.01 par value per share ("Vacation Break Common Stock"), of
Vacation Break will be converted into the right to receive .6075 (the "Exchange
Ratio") of a share of common stock, par value $.01 per share ("Fairfield Common
Stock"), of Fairfield, and (iii) Fairfield will assume each outstanding option
to purchase shares of Vacation Break Common Stock previously granted under the
Plan (each an "Option");
WHEREAS, each Option assumed by Fairfield will be deemed to constitute an
option to acquire Fairfield Common Stock on the terms and conditions described
in the Merger Agreement;
WHEREAS, the Vacation Break Board desires to amend the Plan in order to
adjust the terms of all outstanding Options granted under the Plan to provide
that, at the effective time of the Merger (the "Effective time"), each Option
outstanding immediately prior to the Effective Time will be deemed to constitute
an option to acquire Fairfield Common Stock on the terms and conditions
described in the Merger Agreement, and to provide for the other matters set
forth herein in order to give effect to the Merger;
NOW, THEREFORE, effective as of the Effective Time, the Plan is hereby
amended as follows, subject only to the condition that the Effective Time
occurs:
1. ASSUMED OPTIONS AND SHARES. Each Option assumed by Fairfield shall
--------------------------
constitute an option to acquire, on the same terms and conditions as were
applicable under such Option, the number of shares of Fairfield Common Stock
rounded up or down to the nearest whole share equal to the product of the
Exchange Ratio multiplied by the number of shares of Vacation Break Common Stock
subject to such Option immediately prior to the Effective Time, at a price per
share equal to the aggregate exercise price for the shares of Vacation Break
Common Stock subject to such Option divided by the number of shares of Fairfield
Common Stock deemed to be purchasable pursuant to such Option ("Assumed
Options"); provided that the conversion of any Option into an Assumed Option
with an exercise price less than $.01 per share of Fairfield Common Stock will
be subject to the Optionee's agreement that upon exercise, (x) to the extent
Fairfield is holding Fairfield Common Stock as treasury shares that are not
reserved for any other purpose, Fairfield shall issue the appropriate number of
such treasury shares to the Optionee and (x) to the extent that no such treasury
shares are available, such Optionee shall pay an exercise price of $.01 per
share of Fairfield Common Stock. Subject to the proviso contained in the
preceding sentence, shares of Fairfield Common will be made available for
issuance upon exercise of Assumed Options from authorized but unissued shares of
Fairfield Common Stock.
2. EXERCISE OF ASSUMED OPTIONS. From and after the Effective Time the
---------------------------
Assumed Options shall be vested and fully exercisable in accordance with their
terms. A holder of an Assumed Option may exercise such Assumed Option in whole
or in part in accordance with its terms by delivering a properly executed notice
of exercise to Fairfield, together with the consideration therefor and the
federal withholding tax information required in accordance with the Plan.
-22-
<PAGE>
3. TRANSFERABILITY OF ASSUMED OPTIONS. All restrictions or limitations
----------------------------------
on transfer and vesting with respect to Options awarded under the Plan, to the
extent that such restrictions or limitations shall not have already lapsed,
shall remain in full force and effect with respect to the Assumed Options.
4. ADMINISTRATION OF THE PLAN. The Plan as amended hereby (the "Amended
--------------------------
Plan") shall be administered by the Compensation Committee of the Board of
Directors of Fairfield (the "Compensation Committee") and the Board of Directors
of Fairfield (the "Fairfield Board"). The Compensation Committee and the
Fairfield Board shall have the full authority and discretion to administer the
Amended Plan and to take any action that is necessary or advisable in connection
with the administration of the Amended Plan, including without limitation the
authority and discretion to interpret and construe any provision of the Amended
Plan or of any agreement, notification or document evidencing the grant of an
Option or an Assumed Option. The interpretation and construction by the
Compensation Committee or the Fairfield Board, as applicable, of any such
provision or of any agreement, notification or document and any determination by
the Compensation Committee or the Fairfield Board pursuant to any provision of
the Amended Plan or of any such agreement, notification or document will be
final and conclusive; provided that if the Compensation Committee disagrees with
the Fairfield Board with respect to any such interpretation, instruction or
determination, the Fairfield Board's determination will be final and conclusive
except with respect to Assumed Options intended to comply with Section 162(m) of
the Code. In furtherance and without limiting the generality of the foregoing,
all power, authority and discretion to adjust, modify, amend, terminate or
otherwise change the terms of Options or the Plan formerly vested in the
Vacation Break Board or the stock option committee thereof appointed by the
Vacation Break Board pursuant to the Plan shall be vested in the Fairfield Board
and the Compensation Committee with respect to Assumed Options and the Amended
Plan.
5. CERTAIN DEFINITIONS AND INTERPRETIVE MATTERS.
--------------------------------------------
(a) In order to give effect to the Merger, the terms of the Merger
Agreement regarding Assumed Options, and this Amendment, for purposes of
the Amended Plan the following terms, when used in the sections of the Plan
indicated below, shall have the following meanings:
(i) "Company" shall mean Fairfield when used in Sections 7, 8,
9 and 10 of the Plan; provided, however, that references to
termination of employment shall mean termination of employment with
Vacation Break;
(ii) "Committee" shall mean the Compensation Committee or the
Fairfield Board, as applicable, when used in Sections 7, 8, 9, 10 and
16 of the Plan;
(iii) "Option" shall mean "Assumed Option" when used in Sections
7, 8, 9 and 10 of the Plan.
(b) The terms and provisions of the Plan shall be liberally construed
to give effect to the Merger, the terms of the Merger Agreement regarding
Assumed Options and this Amendment.
(c) Except as amended or modified hereby or inconsistent with Section
5(b) of this Amendment, the terms and conditions of the Plan shall remain
in full force and effect.
EXECUTED as of December 18, 1997
VACATION BREAK USA, INC.
By: /s/ Ralph P. Muller
-----------------------------------
Ralph P. Muller
Chairman of the Board and
Chief Executive Officer
-23-
<PAGE>
EXHIBIT 23.1
------------
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Post-Effective Amendment No.1 Form S-8 No. 333-42901) for the registration of
425,127 shares of Fairfield Communities, Inc. common stock pertaining to the
Vacation Break U.S.A., Inc. Directors' Stock Option Plan and Vacation Break
U.S.A., Inc. 1995 Stock Option Plan of our report dated February 2, 1998, with
respect to the consolidated financial statements incorporated by reference in
its Annual Report (Form 10-K) for the year ended December 31, 1997 and the
related financial statement schedule included therein, filed with the Securities
and Exchange Commission.
Ernst & Young LLP
Little Rock, Arkansas
March 12, 1998
<PAGE>
EXHIBIT 23.2
------------
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this registration statement on
Form S-8 (SEC Registration No. 333-42901) of our report dated March 14, 1997,
except for Notes 22 and 24, as to which the date is October 9, 1997, on our
audits of the consolidated financial statements of Vacation Break U.S.A.,
Inc. as of December 31, 1996, and for the two years in the period ended
December 31, 1996, appearing in the registration statement on Form S-4 (SEC
Registration No. 333-39615) of Fairfield Communities, Inc. filed with the
Securities and Exchange Commission pursuant to the Securities Act of 1933.
Coopers & Lybrand L.L.P.
Ft. Lauderdale, Florida
March 12, 1998
