<PAGE>

                                                                   EXHIBIT 10.18


                                November 3, 1999


Mr. Thomas W. Lattin
5911 Bermuda Dunes
Houston, TX  77069

Dear Tom:

     This letter agreement (the "Agreement") confirms the agreement that we have
reached regarding your resignation from your regular, full-time employment and
all offices you hold with Wyndham International, Inc. ("WII"), and its related
and affiliated entities (collectively, the "Companies").

     The purpose of this Agreement is to establish mutually agreeable
arrangements for ending your employment and structuring your continuing
relationship with the Companies following your resignation. This Agreement does
not constitute and should not be construed as an admission by the Companies that
they have in any way violated any legal obligation that they owe to you or to
any other person or as an admission by you that you have in any way violated any
legal obligation that you owe to the Companies or to any other person.  To the
contrary, the parties' willingness to enter into this Agreement demonstrates
that they are continuing to deal with each other fairly and in good faith.

     With those understandings and in exchange for the promises set forth below,
you and the Companies agree as follows:

  1. Resignation
     -----------

     You hereby resign as an employee of WII effective as of October 29, 1999
(the "Resignation Date").  You also hereby resign from your offices of Executive
Vice President of WII and any and all employment, offices and board of directors
seats that you may hold with any of the other Companies as of the Resignation
Date.  Said resignations are hereby accepted by the Companies.
<PAGE>

Mr. Thomas W. Lattin
November 3, 1999
Page 2


  2. Compensation and Benefits
     -------------------------

     (a) Vesting of Outstanding Options.  Effective as of June 30, 1999 (the
         ------------------------------
"Vesting Date"), all of your outstanding unvested options to purchase shares of
common stock of WII ("Shares") vested and remain fully exercisable following the
Resignation Date to the extent and upon the terms provided in the Employee Stock
Option or Incentive Plan or any other agreement or instrument attendant thereto
pursuant to which such options were granted.

     (b) Restricted Paired Units.  Effective as of the Vesting Date, the
         -----------------------
restrictions lapsed on the remaining restricted Paired Units previously granted
to you by Patriot American Hospitality, Inc. ("PAHI") and WII.

     (c) Severance.  WII  shall pay you severance in a gross amount equal to
         ---------
Five Hundred Twenty-Eight Thousand Four Hundred and Sixteen Dollars and 59/100
($528,416.59) (the "Severance Payment").  The Severance Payment shall be reduced
by applicable withholding and shall be payable by lump sum to you within five
(5) business days following the Effective Date (as defined in Section 14(d)
below) by check or wire transfer as directed by you.

     (d) Benefit Continuation.  You may continue to participate in WII's group
         --------------------
health and dental plans in which, and to the same extent as, you are currently
participating for up to one (1) year from the Resignation Date, with the cost of
the regular premium for such benefits shared in the same relative proportion by
you and WII as in effect for senior executives of WII on the Resignation Date;
provided that nothing in this Section 3(d) shall be construed to affect your or
--------
your dependents' rights thereafter to receive continuation coverage to the
extent authorized by and consistent with 29 U.S.C. (S) 1161 et seq. (commonly
known as "COBRA") and applicable group health and dental plan terms, entirely at
your or their own cost after your right to cost sharing under this Section 3(d)
ends.

     (e) Outplacement.  WII shall pay for the reasonable costs of executive
         ------------
outplacement services selected by you for use in connection with obtaining other
employment for up to six (6) months from the Resignation Date or through the
date you secure new employment, whichever occurs first.

     (f) Other Benefits.  Except as expressly provided above, your eligibility
         --------------
to participate in any of the Companies' respective employee benefit plans and
programs ceases on or after the Resignation Date in accordance with the terms
and conditions of each of those benefit plans and programs and your rights to
benefits under
<PAGE>

Mr. Thomas W. Lattin
November 3, 1999
Page 3


any of the employee benefit plans and programs, if any, are governed by the
terms and conditions of each of those employee benefit plans and programs.

  4. Release of Claims
     -----------------

     (a) Release by Mr. Lattin.  You voluntarily and irrevocably release and
         ---------------------
discharge the Companies, their related or affiliated entities, and their
respective predecessors, successors, and assigns, and the current and former
officers, directors, shareholders, employees, and agents of each of the
foregoing (any and all of which are referred to as "Releasees") generally from
all charges, complaints, claims, promises, agreements, causes of action,
damages, and debts that relate in any manner to your employment with or services
for the Companies or the termination thereof, known or unknown ("Claims"), which
you have, claim to have, ever had, or ever claimed to have had against any of
the Releasees through the date on which you execute this Agreement.  This
general release of Claims includes, without implication of limitation, all
Claims for or related to: the Employment Agreement; the compensation provided to
you by the Companies; your resignations as described in Section 1; wrongful or
constructive discharge; breach of contract; breach of any implied covenant of
good faith and fair dealing; tortious interference with advantageous relations;
intentional or negligent misrepresentation, fraud or deceit; infliction of
emotional distress, and unlawful retaliation or discrimination under the common
law or any federal, state or local statute or law (including, without
implication of limitation, the Employee Retirement Income Security Act,  Title
VII of the Civil Rights Act of 1964, the American with Disabilities Act, the Age
Discrimination in Employment Act, Tex. Lab. Code (S)(S) 21.001, et seq., and
Tex. Hum. Res. Code (S)(S) 121.001, et seq.).  You also waive any Claim for
reinstatement, severance, incentive or retention pay (except as expressly
provided in this Agreement), attorney's fees, or costs, relating to the above
waived claims.

     You agree that you will not hereafter pursue any Claim against any Releasee
by filing a lawsuit in any local, state or federal court for or on account of
anything which has occurred up to the present time as a result of your
employment, and you shall not seek reinstatement with, or damages of any nature,
severance, incentive or retention pay, attorney's fees, or costs from the
Companies or any of the other Releasees; provided, however, that nothing in this
                                         --------
general release shall be construed to bar or limit your rights, if any, to
indemnification subject to and in accordance with the terms of the By-Laws of
WII and the Indemnification Agreement, dated as of May 23, 1998, by and among
you, WII and PAHI (the "Indemnification Agreement"), or to enforce your rights
under this Agreement.

     (b) Release by the Companies.  The Companies, on behalf of themselves and
         ------------------------
their respective predecessors, successors, assigns, directors (but only in
<PAGE>

Mr. Thomas W. Lattin
November 3, 1999
Page 4


their capacities as directors of the Companies) and officers (but only in their
capacities as officers of the Companies) voluntarily and irrevocably release and
discharge you and your successors, assigns, heirs and survivors from any and all
charges, complaints, claims, promises, agreements, causes of action, damages and
debts, (including attorney's fees and costs actually incurred) which any of them
have, claim to have, ever had or ever claimed to have had against you through
the date hereof, known or unknown, which relate to good faith acts or omissions
by you during the course of your employment undertaken or not undertaken in the
reasonable belief that such acts or omissions were in the best interests of the
Companies.

  The Companies further represent that they do not have any knowledge at this
time of any acts or omissions by you that would give rise claims not otherwise
released in the previous paragraph.

  5. Employment Agreement
     --------------------

     This Agreement supersedes all provisions of any employment agreements,
express or implied, you have entered into with any of the Companies, except that
Paragraphs 4, 5, 13 and 15 of that certain Executive Employment Agreement, dated
as of April 14, 1997, by and between PAHI and you (the "Employment Agreement")
are incorporated herein by reference and shall continue to bind you in
accordance with their respective terms.  For purposes of Paragraph 5 of the
Employment Agreement, you acknowledge that the termination of your employment
shall not be deemed to be "solely by reason of the expiration of the Period of
Employment without extension."

  6. Return of Property
     ------------------

  All documents, records, material and all copies of any of the foregoing
pertaining to Confidential Information (as defined in Paragraph 4 of the
Employment Agreement), and all software, equipment, and other supplies, whether
or not pertaining to Confidential Information, that have come into your
possession or been produced by you in connection with your employment
("Property") have been and remain the sole property of the Companies.  You shall
return all Property to the Companies on or before the Resignation Date.  In no
event should this provision be construed to require you to return to the Company
any document or other materials concerning your remuneration and benefits during
your employment with the Companies.
<PAGE>

Mr. Thomas W. Lattin
November 3, 1999
Page 5


  7. Nondisparagement
     ----------------

  You agree not to take any action or make any statement, written or oral,
which disparages or criticizes the Companies or their respective officers,
directors, agents, or management and business practices, or which disrupts or
impairs the Companies' normal operations.  The Companies, on behalf of
themselves, agree (a) not to take any action or make any statement, written or
oral, which disparages or criticizes you or your management and business
practices, and (b) to instruct their respective directors and officers not to
take any action or make any statement, written or oral, which disparages or
criticizes you or your management and business practices.  The provisions of
this Section 7 shall not apply to any truthful statement required to be made by
you or the Companies, as the case may be, in any legal proceeding or
governmental or regulatory investigation.

  8. Additional Representations, Warranties and Covenants
     ----------------------------------------------------

     (a)   As a material inducement to the Companies to enter into this
Agreement, you represent, warrant and covenant as follows:

     (i)   You have not assigned to any third party any Claim released by this
     Agreement.

     (ii)  You have not heretofore filed with any agency or court any Claim
     released by this Agreement.

     (b)   As a material inducement to you to enter into this Agreement, the
Companies represent, warrant and covenant as follows:

     (i)   The Companies have not assigned to any third party any claim against
     you released by this Agreement; and

     (ii)  The Companies have not heretofore filed with any agency or court any
     claim against you released by this Agreement.
<PAGE>

Mr. Thomas W. Lattin
November 3, 1999
Page 6


  9.  Further Assurances
      ------------------

  Upon the terms and subject to the conditions herein provided, each of the
parties hereto agrees to use its reasonable efforts to take, or cause to be
taken, all action and to do, or cause to be done, all things necessary, proper
or advisable under applicable laws and regulations to consummate and make
effective the transactions contemplated by this Agreement, subject, in the case
of the Companies, to the provisions of any credit agreement or financing
agreement or other contract or agreement by which any of the Companies may be
bound.

  10. Exclusivity
      -----------

  This Agreement sets forth all the consideration to which you are entitled
from the Companies by reason of your resignation and your duties for the
Companies while employed, and you agree that you shall not be entitled to or
eligible for any payments or benefits under any other Company severance, bonus,
retention or incentive policy, arrangement or plan.

  11. Tax Matters
      -----------

  All payments and other consideration provided to you pursuant to this
Agreement shall be subject to any deductions, withholding or tax reporting that
the Companies reasonably determine to be required for tax purposes.  You and the
Companies understand that there may be tax consequences under Section 280G and
4999 of the Internal Revenue Code with respect to the payments and benefits to
you hereunder.   The Companies agree to review and discuss with you such tax
consequences, but you understand and agree that none of the Companies hereby are
making any commitment of contractual significance to provide any other payments
to you as a result of such tax consequences.

  12. Arbitration of Disputes
      -----------------------

  Any controversy or claim arising out of or relating to this Agreement or
the breach thereof shall, to the fullest extent permitted by law, be settled by
arbitration in accordance with Paragraph 15 of the Employment Agreement.  This
Section 12 shall be specifically enforceable. Notwithstanding the foregoing,
this Section 12 shall not preclude either party from pursuing a court action for
the sole purpose of obtaining a temporary restraining order or a preliminary
injunction in circumstances in which such relief is appropriate; provided that
                                                                 --------
any other relief shall be pursued through an arbitration proceeding pursuant to
this Section 12.
<PAGE>

Mr. Thomas W. Lattin
November 3, 1999
Page 7


  13. Consent to Jurisdiction
      -----------------------

  To the extent that any court action is permitted consistent with or to
enforce Section 12 of this Agreement, the parties hereby consent to the
jurisdiction of the state and federal courts in or for Dallas, Texas.
Accordingly, with respect to any such court action, you and the Companies (a)
submit to the personal jurisdiction of such courts; (b) consent to service of
process; and (c) waive any other requirement (whether imposed by statute, rule
of court, or otherwise) with respect to personal jurisdiction or service of
process.

  14. Notices, Acknowledgments and Other Terms
      ----------------------------------------

      (a) You are advised to consult with an attorney before signing this
Agreement.

      (b) You acknowledge and agree that the Companies' promises in this
Agreement constitute consideration in addition to anything of value to which you
are otherwise entitled by reason of the termination of your employment.

      (c) By signing this Agreement, you acknowledge that you are doing so
voluntarily and knowingly, fully intending to be bound by this Agreement.  You
also acknowledge that you are not relying on any representations by us or any
other representative of the Companies concerning the meaning of any aspect of
this Agreement. You understand that this Agreement shall not in any way be
construed as an admission by the Companies of any liability or any act of
wrongdoing whatsoever by the Companies against you and that the Companies
specifically disclaim any liability or wrongdoing whatsoever against you on the
part of themselves and their respective officers, directors, shareholders,
employees and agents.  You understand that if you do not to enter into this
Agreement and bring any claims against the Companies, the Companies will dispute
the merits of those claims and contend that they acted lawfully and for good
business reasons with respect to you.

      (d) You acknowledge that you have been given the opportunity, if you so
desired, to consider this Agreement for twenty-one (21) days before executing
it.  If not signed by you and returned to the General Counsel of WII so that it
is received by close of business on the twenty-second (22nd) day after your
receipt of the Agreement, this Agreement will not be valid.  In addition, if you
breach any of the conditions of the Agreement within the twenty-one (21) day
period, the offer of this Agreement will be withdrawn and your execution of the
Agreement will not be valid.  In the event that you execute and return this
Agreement within twenty-one (21) days or less of the date of its delivery to
you, you acknowledge that such decision was entirely voluntary and that you
<PAGE>

Mr. Thomas W. Lattin
November 3, 1999
Page 8


had the opportunity to consider this letter agreement for the entire twenty-one
(21) day period. The Companies acknowledge that for a period of seven (7) days
from the date of the execution of this Agreement, you shall retain the right to
revoke this Agreement by written notice delivered to the General Counsel of WII
before the end of such period, and that this Agreement shall not become
effective or enforceable until the expiration of such revocation period (the
"Effective Date").

     (e) In the event of any dispute, this Agreement will be construed as a
whole, will be interpreted in accordance with its fair meaning, and will not be
construed strictly for or against either you or the Companies.

     (f) The law of the State of Texas will govern any dispute about this
Agreement, including any interpretation or enforcement of this Agreement.

     (g) In the event that any provision or portion of a provision of this
Agreement shall be determined to be illegal, invalid or unenforceable, the
remainder of this Agreement shall be enforced to the fullest extent possible and
the illegal, invalid or unenforceable provision or portion of a provision will
be amended by a court of competent jurisdiction to reflect the parties' intent
if possible.  If such amendment is not possible, the illegal, invalid or
unenforceable provision or portion of a provision will be severed from the
remainder of this Agreement and the remainder of this Agreement shall be
enforced to the fullest extent possible  as if such illegal, invalid or
unenforceable provision or portion of a provision was not included.

     (h) This Agreement may be modified only by a written agreement signed by
you and authorized representatives of the Companies.

     (i) This Agreement constitutes the entire agreement between the parties
with respect to the subject matter hereof and supersedes all prior agreements
between the parties with respect to any related subject matter; provided that
                                                                --------
the Indemnification Agreement shall remain in full force and effect in
accordance with its terms.

     (j) This Agreement shall be binding upon each of the parties and upon their
respective heirs, administrators, representatives, executors, successors and
assigns, and shall inure to the benefit of each party and to their heirs,
administrators, representatives, executors, successors, and assigns.
<PAGE>

Mr. Thomas W. Lattin
November 3, 1999
Page 9

     If you agree to these terms, please sign and date below and return this
Agreement to the General Counsel of WII.


                                        Sincerely,


                                        WYNDHAM INTERNATIONAL, INC.


                                        By:
                                           ------------------------------------
                                           James D. Carreker
                                           Chairman and Chief Executive Officer



Accepted and agreed to:


-----------------------------------     ---------------------------------------
Thomas W. Lattin                        Date