Fairholme Funds, Inc. December 2018 Dividend Distributions

MIAMI–(BUSINESS WIRE)–FAIRHOLME FUNDS, INC.:

THE FAIRHOLME FUND (FAIRX)

On December 14, 2018, the Fairholme Fund (NASDAQ: FAIRX) distributed an
Ordinary Income dividend of $0.33731 per share to shareholders of record
as of December 13, 2018. The Fairholme Fund’s Net Asset Value (“NAV”)
was reduced by the total amount of the distribution.

The Record Date, Ex-Dividend Date, Payable Date, and Cents-Per-Share are
as follows:

Distribution Type   Record Date   Ex-Dividend Date   Payable Date  

Estimated Cents-
Per-Share

Ordinary Income   December 13, 2018   December 14, 2018   December 14, 2018   $0.33731
Total               $0.33731

THE FAIRHOLME FOCUSED INCOME FUND (FOCIX)

On December 14, 2018, the Fairholme Focused Income Fund (NASDAQ: FOCIX)
distributed an Ordinary Income dividend of $0.05324 per share to
shareholders of record as of December 13, 2018. The Fairholme Focused
Income Fund’s Net Asset Value (“NAV”) was reduced by the total amount of
the distribution.

The Record Date, Ex-Dividend Date, Payable Date, and Cents-Per-Share are
as follows:

Distribution Type   Record Date   Ex-Dividend Date   Payable Date  

Estimated
Cents-Per-Share

Ordinary Income   December 13, 2018   December 14, 2018   December 14, 2018   $0.05324
Total               $0.05324

THE FAIRHOLME ALLOCATION FUND (FAAFX)

On December 14, 2018, the Fairholme Allocation Fund (NASDAQ: FAAFX)
distributed an Ordinary Income dividend of $0.07387 per share to
shareholders of record as of December 13, 2018. The Fairholme
Allocation Fund’s Net Asset Value (“NAV”) was reduced by the total
amount of the distribution.

The Record Date, Ex-Dividend Date, Payable Date, and Cents-Per-Share are
as follows:

Distribution Type   Record Date   Ex-Dividend Date   Payable Date  

Estimated Cents-
Per-Share

Ordinary Income   December 13, 2018   December 14, 2018   December 14, 2018   $0.07387
Total               $0.07387

Past performance is not a guarantee of future results.

Investing in the Funds involves risks including loss of principal.
The Funds’ investment objectives, risks, charges, and expenses should be
considered carefully before investing. The
prospectus
contains this and other important information about the Funds, and it
may be obtained by calling Shareholder Services at (866) 202-2263 or
visiting our website
www.fairholmefunds.com.
Read it carefully before investing.

The Fairholme Fund is non-diversified, which means that The Fairholme
Fund invests in a smaller number of securities when compared to more
diversified funds. Therefore, The Fairholme Fund is exposed to greater
individual stock volatility than a diversified fund. The Fairholme Fund
also invests in foreign securities which involve greater volatility and
political, economic and currency risks and differences in accounting
methods. The Fairholme Fund may also invest in “special situations” to
achieve its objectives. These strategies may involve greater risks than
other fund strategies.

The Fairholme Focused Income Fund (the “Income Fund”) is a
non-diversified mutual fund, which means that the Income Fund invests in
a smaller number of securities when compared to more diversified funds.
This strategy exposes the Income Fund and its shareholders to greater
risk of loss from adverse developments affecting portfolio companies.
The Income Fund’s investments are also subject to interest rate risk,
which is the risk that the value of a security will decline because of a
change in general interest rates. Investments subject to interest rate
risk will usually decrease in value when interest rates rise and rise in
value when interest rates decline. Also, securities with long maturities
typically experience a more pronounced change in value when interest
rates change. Debt securities are subject to credit risk (potential
default by the issuer). The Income Fund may invest without limit in
lower-rated securities. Compared to higher-rated fixed income
securities, lower-rated debt may entail greater risk of default and
market volatility.

The Fairholme Allocation Fund (the “Allocation Fund”) is a
non-diversified mutual fund, which means that the Allocation Fund can
invest in a smaller number of securities when compared to more
diversified funds. The Allocation Fund may invest in lower-rated
securities, which may have greater market risk. This strategy exposes
The Allocation Fund and its shareholders to greater risk of loss from
adverse developments affecting portfolio companies. The allocation of
investments among the different asset classes, such as equity or
fixed-income asset classes, may have a more significant effect on The
Allocation Fund’s net asset value when one of these classes is
performing more poorly than others.

Contacts

Fairholme Funds, Inc.
Jodi Lin, 305-358-3000